Gibbons v. Ogden
Which branch of government has authority to preside over interstate commerce? The 1824 Supreme Court case Gibbons v. Ogden established that the federal government, not states, has that power.
The federal government’s authority to regulate interstate business transactions, including shipping, is clearly spelled out in the Interstate Commerce Clause of the Constitution but this was the first opportunity for the Supreme Court to test and establish the law.
The Gibbons v. Ogden case arose from a dispute over right to navigate waterways between states, which the state of New York had given to one company, owned by Robert Fulton and Robert Livingston, upon development of the commercial steamship in 1803. They had a similar arrangement in Louisiana. The men then sold franchises to others, including New Jersey governor Aaron Ogden and business partner Thomas Gibbons.
When the Ogden-Gibbons steamship business fell apart, Gibbons continued to ply the route between New Jersey and New York. Ogden got an injunction from the New York Chancery Court, ordering Gibbons to stop. Gibbons attorney, Daniel Webster, argued before the New York Court of Errors that the federal government had sole purview over interstate commerce and shipping, which if successful, would have voided the injunction and allowed Gibbons to continue doing business. But the New York courts sided with Ogden.
When the case was appealed to the U.S. Supreme Court, Gibbons ultimately prevailed. The court agreed with the argument that the federal government alone had authority to control interstate shipping.