Extraterritoriality and political heterogeneity in American federalism.

Author:Rosen, Mark D.


It is commonly understood that as a matter of federal law, states may have divergent substantive policies with respect to those matters that are not violative of the United States Constitution. Such diversity among polities is one of the frequently heralded benefits of our federal system. (1) As a practical matter, however, what degree of political heterogeneity among states is possible vis-a-vis substantive policies that are not unconstitutional? In short, what is the degree of legal pluralism that our Constitution's federal regime permits?

The answer to the question turns in large part on whether states, if they so choose, can regulate their citizens even when they are out of their Home States. (2) If they cannot, citizens can bypass their Home States' laws by simply traveling to a more legally permissive state to do there what is prohibited at home. Such "travel-evasion," which in effect gives citizens the power to choose which state's laws are to govern them on an issue-by-issue basis, can cripple the ability of states to accomplish constitutional objectives. Consider, for example, how travel-evasion can frustrate legislation banning assisted suicide: the state's interests that drive such a law are undermined if one of its sick citizens takes a bus to a jurisdiction that allows her to end her life. As this Article explains, such travel-evasion may have the systemic effect of creating a "race-to-the-bottom" to the lowest common denominator of regulation, thereby undercutting the degree of political heterogeneity possible among states in our federal system among policies that are not foreclosed to states by the United States Constitution. On the other hand, a Home State's direction of its citizens' out-of-state activities can run up against the interests of the Host State, and, for many other reasons, may threaten to undermine our federal system. How the interests of the Host State, Home State, and the federal system are to be accommodated is the subject of this Article.

There are many constitutionally legitimate state goals that can be frustrated if citizens can free themselves of their Home State's legal requirements merely by crossing a border. For example, those states that require motorcyclists to wear helmets typically do so to protect both their citizens' health and the state's coffers (since badly injured people require medical assistance, may become public charges, etc.). Of course, the state's interests are no less implicated if one of its bareheaded citizens is injured while motorcycling in a sister jurisdiction without helmet laws. So can a state require that its citizens wear helmets when riding motorcycles wherever they might be? Consider as well:

* A state may ban gambling altogether for moral reasons, to prevent the costs imposed on gamblers' families, or to reduce the creation of public charges. (3) Since such policy goals are undermined regardless of where the citizen's gambling occurs, can a Home State ban its citizens from gambling not only at home but also in all other states. (4)

* Many states have refused to accept the battered spouse defense for wives that kill their battering husbands (and vice versa). Is a Home State that does not accept the defense without recourse if a battered husband kills his wife while the couple is on vacation in a Host State that accepts the defense? (5)

* A Home State may prohibit discrimination on the basis of sexual orientation to protect gay men and lesbians and to counteract homophobia by requiring interaction between heterosexuals and homosexuals. Can the Home State apply its regulations to a citizen who runs a business in a state that does not have such an anti-discrimination law? (6)

* It is constitutional for states to enact parental notification laws that protect the interests of the pregnant minor's parents by providing them the "opportunity to consult with [their daughter] in private, and to discuss the consequences of her decision in the context of the values and moral or religious principles of their family." (7) What, if anything, can the Home State do to keep its policy from being skirted by the minor crossing the border? (8)

In fact, a broad array of state laws can be circumvented through travel--laws running the gamut from citizen welfare and the integrity of government to the conduct of business. This Article explores the circumstances under which states can counter such "travel-evasion" to ensure the efficacy of policies that they are constitutionally permitted to pursue. It suggests that to a large degree they can. For instance, this Article will show that states can regulate

extraterritorially to counter all the above-mentioned kinds of travel-evasion. (9)

The question of extraterritorial regulation to counter travel-evasion is of more than just theoretical interest. Pennsylvania recently prosecuted an adult who helped a pregnant minor travel out of the state to avoid the parental notification requirements of her Home State, (10) and a few years ago the United States House of Representatives approved a bill that would have made an adult's assistance to such pregnant minors a federal crime. (11) Consider as well Wisconsin's recent efforts to put small Wisconsin dairy farms on an even playing ground with large Wisconsin farms. Purchasers of raw milk paid premiums to large Wisconsin dairy farms in excess of the economic savings that attended the purchase of milk from large farms. To deprive large Wisconsin farms of financial benefits that were not the result of economic efficiencies and thereby engender fairer competition, Wisconsin prohibited premiums to the extent they exceeded the real economic savings of purchasing milk from large farms. The large Wisconsin farms and milk purchasers then engaged in classic travel-evasion: with the express purpose of avoiding the Wisconsin law, they restructured the sales so they technically occurred in Illinois, which did not have such a restriction on premiums. Wisconsin in turn sought to apply its prohibition extraterritorially to such Illinois sales. (12)

These examples notwithstanding, few states have tried to frustrate travel-evasion by regulating their citizens' out-of-state activities. There is evidence that this paucity of examples is attributable to a perception among the states that they are without power to regulate extraterritorially. (13) Indeed, the House Bill was condemned in the popular press on such a ground, (14) and Wisconsin's effort was struck down under the Dormant Commerce Clause by a federal court of appeals. (15) This Article will suggest that such criticism is misplaced, (16) and that the court's analysis was erroneous. (17) I hope in this Article to correct the misperception of state incapacity to regulate extraterritorially, so as to allow states to consider this form of regulation on its merits. (18)

Courts and commentators have asserted several doctrinal objections to state efforts to regulate their citizens' out-of-state conduct. The first claim is that states simply do not have the power to regulate conduct occurring outside their borders. Language from the United States Supreme Court case Bigelow v. Virginia (19) has been said to support this view. (20) The Court in Bigelow stated that a "State does not acquire power or supervision over the internal affairs of another State merely because the welfare and health of its own citizens may be affected when they travel to that State." (21) Similarly, the Arizona Court of Appeals recently held that "`[l]aws have no force of themselves beyond the jurisdiction of the state which enacts them, and can have extraterritorial effect only by the comity of other states.'" (22) Much Dormant Commerce Clause jurisprudence seems to take a similar approach, as such caselaw announces that states may not enact "extraterritorial legislation" that "`directly regulates transactions which take place across state lines.'" (23) This Article will show that these lines of caselaw do not undermine the well-established and normatively sound jurisprudence that states have inherent power to regulate their citizens' extraterritorial conduct.

A second possible objection to extraterritorial regulation is that even if Home States have some extraterritorial powers with respect to their citizens, they do not have the power to prohibit them from engaging in activities in Host States that are permissible for the Host States' citizens. Professor Seth Kreimer has advanced this view, relying in part on the above-mentioned case of Bigelow to argue that the "tradition of American federalism stands squarely against efforts by states to punish their citizens for conduct that is protected in the sister state where it Occurs." (24) Professors Rollin Perkins and Ronald Boyce have proffered comparable arguments. (25) Professor Lea Brilmayer has come to a similar conclusion, arguing that with regard to issues about which there are sharp moral disagreements among states, such as abortion and the right to die, "the structure of our federal system clearly compels the priority of the territorial state, and ... this priority typically invalidates the residence state's claim to regulate." (26)

This Article argues against the positions advanced by Professors Kreimer, Perkins, Boyce, and Brilmayer, as well as the other objections to extraterritorial regulation that have been propounded. (27) It shows that our country's federal union imposes far more modest limitations on states' inherent powers to regulate the extraterritorial conduct of their citizens. The Constitution creates a national union, to be sure, but it is a union of meaningfully empowered states. Meaningful empowerment means that states can take reasonable steps, including extraterritorial regulation, to ensure the efficacy of heterogeneous policies that themselves are not unconstitutional. The political heterogeneity that extraterritorial regulation permits is an affirmative good in a...

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