Nebbia v. New York - Significance

Ever since the Munn v. Illinois decision in 1877, the Court had distinguished between public enterprise, which the state may regulate, and private enterprise, which it may not. With Nebbia, the Court did away with this distinction once and for all.

In 1933, in the midst of the Great Depression, New York State created a Milk Board, whose job it was to set minimum and maximum retail prices for milk prices. The board fixed nine cents as the price to be charged for a quart of milk. The purpose of this price fixing was to ease the economic hardship being experienced both by retailers and their customers.

Leo Nebbia was the proprietor of a small grocery store in Rochester, New York. He sold two quarts of milk and a 5-cent loaf of bread for 18 cents, as a result of which he was charged with violating the Milk Control Act. After successive appeals to the county court and the New York Court of Appeals failed, Nebbia appealed to the U.S. Supreme Court.