Hunt v. Washington State Apple Advertising Commission
North Carolina required all apples containers to display only the applicable USDA grade or no grade at all. Washington developed its own grading standard for apples with more stringent requirements. Thus all of Washington's apples were prohibited from North Carolina without repackaging specially for the state.
Trial court found that the North Carolina statute was facially neutral but actually discriminated against Washington growers and dealers in favor of their local counterparts. It found this discrimination was not justified by trying to eliminate deception and confusion for apples and so enjoined enforcement of the regulation.
Did the North Carolina statute discriminate against interstate commerce without justification?
When a state statute conflicts with the Commerce Clause's overriding requirement of a national "common market," the competing national and local interests must be balanced.
The statute burdens and discriminates against out-of-state commerce in multiple ways. It raises costs of doing business in state, strips away Washington's advantage of its more extensive regulations, and has a leveling effect which insidiously operates to local apple producers' advantage.
There were indications that the law was motivated by a discriminatory purpose, but it is not necessary to show an economic protection motive to resolve the case. Even trying to protect consumers from fraud, the state must still show that it is justified both in terms of the local benefits and the unavailability of nondiscriminatory alternatives adequate to preserve the local interests. North Carolina has not sustained its burden on either score.
The state does very little to eliminate deception and confusion because it still allows apple containers to have no grades at all. It also does apply at the retail level, only to wholesalers who purchase closed containers of apples. There are also alternatives. North Carolina could just allow state grades in addition to the USDA grade.
Yes, the North Carolina statute discriminated against interstate commerce without justification. Affirmed.