The Privileges and Immunities Clause
Privileges and Immunities Clause:
The Dormant Commerce Clause is not the only Constitutional limit on a state’s ability to pass law affecting out-of-staters. The Privileges and Immunities Clause of Article IV ensures that an out-of-state citizen enjoys the same privileges as a citizen of the state in which he happens to find himself. The negative implications of the Commerce Clause, discussed in Subject 3, prevent states from acting in such a way as to burden interstate commerce. The Privileges and Immunities Clause of Article IV (“PIC4”) protects citizens from discrimination regarding “fundamental rights.” So who are these “citizens” and what are these “fundamental rights?”
In Paul v. Virginia, 75 U.S. 168, 180 (1868), the Court pointed out that “it was the object of the clause in question to place the citizens of each State upon the same footing with citizens of other States, so far as the advantages resulting from citizenship in those States are concerned” The Court went on to say that “Special privileges enjoyed by citizens in their own States are not secured in other States by this provision.” Paul at 181. The Court found that a “corporation” was not a “citizen” within the meaning of the PIC4, but rather a grant of special privileges by the home state. So it was established early on that while the protection afforded by the Commerce Clause was wide-reaching insofar as it applies to corporations and other entities as well as individuals, the PIC4 protection would extend only to individual persons.
We are provided further elaboration on the meaning of “citizens” for PIC4 purposes in Supreme Court of Virginia v. Friedman, 487 U.S. 59 (1988). Virginia Supreme Court Rules permitted qualified attorneys admitted to practice in another state reciprocity admission to the Virginia Bar (referred to as admission “on motion”) provided, among other things, that the applicant was a permanent resident of Virginia. In finding the requirement violated the PIC4, the Court said that “for analytic purposes citizenship and residency are essentially interchangeable.” Friedman at 64, citing United Building & Construction Trades Council v. Camden, 465 U.S. 208, 216 (1984).
So Paul and Friedman provide us with some understanding of who is protected under the PIC4. Individual persons are to be afforded the same privileges and rights as the individuals who are citizens, or residents, of the state in question. As the Court put it in Toomer v. Witsell, 334 U.S. 385, 395 (1948), “It was designed to insure to a citizen of State A who ventures into State B the same privileges which the citizens of State B enjoy”
EXAMPLE: In an effort to strengthen the local economy, Nevada passes a law requiring that state residents comprise at least 25% of the labor on all state-funded construction projects. Because the right to be employed is a fundamental right, and non-Nevada residents are being discriminated against by this statute, there is the risk of running afoul of the PIC4.
EXAMPLE: Tired of corporations changing the feel of small-town main streets with their corporate logos, Midstate passes a law preventing the display of corporate logos larger than 2 feet high on storefronts. Businesses incorporated under the laws of Midstate are automatically exempt from the limitation and may display whatever signs they like. Whatever other issues such a law might raise, there is no PIC4 issue, as the right to display a corporate logo is not a fundamental right, and even if it were corporations are not protected under the PIC4.
In the examples above, it was assumed that the right to employment is fundamental while the right to display a corporate logo is not. The Court in Baldwin v. Fish and Game Commission of Montana, 436 U.S. 371, 388 (1978) refused to “decide the full range of activities that are sufficient to the livelihood of the Nation that the States may not interfere with a nonresident’s participation therein without similarly interfering with a resident’s participation.” But, the court did point out that the case, which involved the issuance of elk hunting licenses, did not involve an individual being “deprived of a means of a livelihood by the system or of access to any part of the State to which they seek to travel.” The Court also distinguished the case before it from Toomer, in which the cost of fishing licenses involved commercial enterprises.
A common refrain runs through Baldwin, Toomer, and Friedman: Commercial activity is “fundamental” within the meaning of the PIC4, while merely recreational activity is not. In other words, the PIC4 will protect citizens of a state against discrimination when there is some commercial activity involved. Further, the mention of “travel” in Baldwin hints at our second area of protection under the PIC4: Civil liberties. So, commercial activities and civil liberties are the two categories of PIC4 protection, and this protection is afforded to individual person only, not corporations or other entities.
EXAMPLE: Forest Gump is a Georgia resident seeking to fish off the coast of South Carolina. (Bubba-Gump Shrimp didn’t do as well as he had planned, and he is now working on his own.) For various reasons, Gump refuses to move away from his native Georgia. However, the best shrimping around, he’s been told, is in South Carolina. He packs up his boat and goes to South Carolina, stopping to get a proper license to avoid doing any wrong. His friend in the army had told him he got a license in South Carolina for $150, and Gump factors this price into his budget. Upon arrival, however, he is told that $150 is the resident fee for a license, and that the law is that nonresidents must pay $2500. Poor Gump is so disappointed that he leaves his boat at the dock and runs all the way home. Because the law discriminates against Gump in his ability to earn a livelihood by shrimping, it is invalid under the PIC4.
EXAMPLE: While running home Gump gets it in his head to just keep on running, as so he does. Somewhere in South Dakota he comes to a gate across the road and a sign that reads “State Residents Only.” Good-natured fellow that he is, Gump turns around and starts back in the other direction, even though this means he’ll never see that other ocean. Because the right to travel freely is fundamental, the PIC4 means that a state cannot restrict access in this way, unless it is similarly restricted from access by state residents.
Now that we know what “citizens” are protected in their “fundamental rights” we are ready to engage in “a two-step inquiry.
So we must ask ourselves two question in carrying out a PIC4 analysis. (1) Does the law discriminate against citizens of another state in regards to a fundamental right? (2) If so, is the discrimination closely related to the advancement of a substantial state interest? Unless (2) can be answered in the affirmative, the law will be invalid under the PIC4.
The following flowchart summarizes what you have learned in this chapter:
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