Nebbia v. New York 291 U.S. 502 (1934)

• Author: Harry N. Schneiber
• Pages: 1788-1789

Page 1788

Both the desperate economic conditions in the American dairy industry and the legal responses to the dairy crisis, during the depression years 1929?1933, exemplified the dilemmas that the Great Depression posed for American law. Vast, unmarketable surpluses of fluid milk and other dairy products, widespread mortgage foreclosures in dairy centers of rural America, and wild swings in dairy prices and consumption, all spelled extreme distress for the industry and its marketing institutions.

Among the states that responded with new legislation was New York, whose dairy industry constituted about half the value of its farm income and served the great urban concentration of population in the city of New York and its metropolitan area. In framing a program to deal with the crisis, New York's lawmakers knew they were forced to walk through a constitutional minefield. Despite provisions of the 1933 federal AGRICULTURAL ADJUSTMENT ACT intended to give the states some latitude in control of dairy commerce involving interstate milksheds, federal district courts around the country had struck down state laws seeking to control interstate movements of fluid milk or the terms on which it could be marketed. In addition, even laws seeking to regulate only in-state production and distribution were challenged as invalid under the AFFECTED WITH A PUBLIC INTEREST rule; indeed, in numerous previous decisions the Supreme Court had in obiter dicta listed dairies among the enterprises that clearly were "ordinary" or "purely private" businesses, not affected with a public interest and therefore not subject to price regulation. In NEW STATE ICE CO. V. LIEBMANN (1932), for example, the Court had denied the legislature of Oklahoma authority to regulate ice manufacturing and selling on the ground that it was "a business as essentially private in its nature as the business of the grocer, the dairyman, the butcher, the baker, the shoemaker, or the tailor."

Mindful of this background, the New York legislature conducted a lengthy investigation of the fluid milk industry and its travails. In addition to making a record, thereby, as to the condition of the farmers and distribution system, the price collapse and its consequences, and the extensive effects of the crisis on the state's economy, when the legislature drafted a new Milk Control Law in March 1933, it explicitly denominated it as emergency legislation and provided for its termination one...