Carter v. Carter Coal Co.

Petitioner
James Walter Carter
Respondent
Carter Coal Co.
Petitioner's Claim
That the Bituminous Coal Conservation Act of 1935, part of President FranklinRoosevelt's New Deal, was an unconstitutional intrusion of the federal government into rights reserved for the states under the Tenth Amendment.
Chief Lawyers for Petitioner
Frederick H. Wood, William D. Whitney, Richard H. Wilmer
Chief Lawyer for Respondent
Karl J. Hardy
Justices for the Court
Pierce Butler, Charles Evans Hughes, James Clark McReynolds, Owen Josephus Roberts, George Sutherland (writing for the Court), Willis Van Devanter
Justices Dissenting
Louis D. Brandeis, Benjamin N. Cardozo, Harlan Fiske Stone
Place
Washington, D.C.
Date of Decision
18 March 1936
Decision
By a vote of 6-3, the Court struck down the act, holding that the Commerce Clause of Article II of the Constitution does not grant Congress the right to regulate commercial activities and labor relations.
Significance
Carter marked the last time the Supreme Court would use the Tenth Amendment to override the Commerce Clause.
In the midst of the Great Depression, President Franklin Roosevelt developedplans for the New Deal, a series of programs designed to curb the disastrouseffects of the economic depression that enveloped the country. As a part of the New Deal, Congress passed the Bituminous Coal Conservation Act of 1935, and it was legislation meant to control overproduction and self-defeating competition between coal mining companies. The philosophical heart of the act--asof the entire New Deal plan--was the belief that the Commerce Clause of Article II of the Constitution empowered Congress with the authority to regulate most aspects of American industry.
James Walter Carter, a shareholder in the Carter Coal Company, filed suit inthe Supreme Court of the District of Columbia seeking an injunction to prevent the company from complying with the coal act. After James Carter's suit wasdismissed, he filed an appeal with the U.S. Court for the District of Columbia. While that appeal was still pending, he also petitioned the U.S. SupremeCourt for review of the trial court's dismissal. In the U.S. Supreme Court, his suit was combined with several others challenging the coal act.
Citing States' Rights, Court Stymies New Deal Legislation
Justice Sutherland wrote the opinion of the Court, which paid scant attentionto the dire conditions then extant in the coal mining business. Instead, itconcentrated on an argument that had dogged the nation since its foundation:the competition between states' rights and federal power.

The ruling and firmly established principle is that the powers which general government may exercise are only those specifically enumerated in the Constitution, and such implied powers as are necessary and proper to carry into effect the enumerated powers. Whether the end sought to be attained by an act of Congressis legitimate is wholly a matter of constitutional power and not at all of legislative discretion.

According to the Court, the commerce power, which the president and Congresssaw as the constitutional rationale for the coal act, did not apply. As it had done many times before, the Court distinguished direct effects on interstate commerce, which Congress could control, from indirect ones, which it couldnot. Here, the effects were deemed indirect because coal mining was "manufacturing" which took place in a set location, not commerce or trade which crossed state lines. If there was to be regulation of coal mining, therefore, the Constitution mandated that it take place at the state level. The coal act wasstruck down.
Since 1933, when Roosevelt took office, the Supreme Court had developed a record of opposing most New Deal legislation that came before it. In frustration, Roosevelt developed a plan for "packing" the Court with justices who wouldbe more amenable to his economic plan for rescuing the country. The plan ultimately failed, but the composition of the Court began to change nonetheless.In 1937, one of the ultra-conservative "Four Horsemen" (named for the Biblical Four Horsemen of the Apocalypse that brought destruction to the land), holdovers from the preceding Taft Court, Justice Van Devanter, announced his retirement, opening up the first of seven vacancies Roosevelt was to fill over the next few years. And in the spring of 1937, Justice Roberts switched his voting posture toward the New Deal. Starting with National Labor Relations Board v. Jones & Laughlin Steel Corp. (1937), the Court abandoned its embrace of states' rights and the Tenth Amendment, and took up the Commerce Clause and the New Deal agenda.
Related Cases

• Schechter Poultry Corp. v. United States, 295 U.S. 495 (1935).
  
• National Labor Relations Board v. Jones & Laughlin Steel Corp., 301 U.S. 1 (1937).

The Bituminous Coal Conservation Act
Bituminous coal, or soft coal, has a lower carbon content than anthracite, orhard coal. The latter, the highest grade of coal, is used for domestic heating; bituminous coal is good only for industrial heating and for coke.
The Bituminous Coal Conservation Act of 1935 was designed to achieve a variety of purposes that included the stabilizing of the coal-mining industry; thepromotion of interstate commerce in coal; the marketing of bituminous coal bycooperative enterprises; the tax guidelines on the sale of such coal; the identification of the production, sale, and use of bituminous coal with a national public interest; and the conservation of bituminous coal.
These justifications were enumerated in section 1 of the act. Section 2 established a National Bituminous Coal Commission within the Department of the Interior; section 3 presented the conditions governing the coal tax; and section4 established guidelines for a nationwide "Bituminous Coal Code" and made anumber of labor provisions. Under the Coal Code, prices could be fixed at certain minimums, and all coal mines throughout the United States would be required to abide by these prices.