Shreveport Rate Cases
The Shreveport Rate Cases refer to two significant legal decisions involving the railroads, specifically Houston, East, and West Texas Railway Co. v. United States and Texas and Pacific Railway Co. v. United States. These cases arose from a dispute concerning the rate structures set by Texas railroads, which charged lower rates for intrastate shipments than for interstate shipments, a practice authorized by the state railroad commission. However, the Interstate Commerce Commission (ICC) intervened, claiming that these intrastate rates negatively impacted interstate commerce. The railroads contended that Congress lacked the authority to regulate intrastate rates based on the Constitution’s commerce clause. Ultimately, the Supreme Court ruled by a 7-2 vote in favor of the ICC, determining that the intertwined nature of intrastate and interstate commerce justified federal regulation. This ruling not only upheld the ICC's authority but also set a precedent for the regulation of transportation rates across state lines, emphasizing the federal government's role in overseeing commerce. Justice Charles Evans Hughes wrote the majority opinion, marking an important moment in U.S. legal history regarding commerce regulation.
Shreveport Rate Cases
Date: June 8, 1914
Citation: 234 U.S. 342
Issue: Regulation of commerce
Significance: The Supreme Court, in these railroad cases, strengthened the Interstate Commerce Commission (ICC) during the early twentieth century.
Two cases, Houston, East, and West Texas Railway Co. v. United States and Texas and Pacific Railway Co. v. United States, were decided together and are known as the Shreveport Rate Cases. A state railroad commission had authorized Texas railroads to charge significantly lower rates for intrastate versus interstate rail shipments. The Interstate Commerce Commission (ICC) issued an order that overruled that state railroad commission’s authorization. The railroads argued that Congress lacked the right to set rates for intrastate transport under the Constitution’s commerce clause, but the Supreme Court found that intrastate and interstate commerce were so intertwined that the Texas intrastate rates had a harmful effect on interstate commerce. By a 7-2 vote, the Supreme Court upheld the ICC order, significantly strengthening the ICC. Justice Charles Evans Hughes wrote the opinion for the majority.
