Louis Liggett Co v. Baldridge

• Decision Date: 19 November 1928
• Docket Number: No. 34,34
• Citation: 49 S.Ct. 57,278 U.S. 105,73 L.Ed. 204
• Parties: LOUIS K. LIGGETT CO. v. BALDRIDGE, Atty. Gen. of Pennsylvania, et al
• Court: U.S. Supreme Court

278 U.S. 105

49 S.Ct. 57

73 L.Ed. 204

LOUIS K. LIGGETT CO.

v BALDRIDGE, Atty. Gen. of Pennsylvania, et al.

No. 34.

Argued Oct. 8, 1928.

Decided Nov. 19, 1928.

Messrs. Owen J. Roberts, of Philadelphia, Pa., and Roy M. Sterne, of New York City, for appellant.

Messrs. Paul C. Wanger, of Philadelphia, Pa., and Thos. J. Baldrige, of Harrisburg, Pa., for appellees.

[Argument of Counsel from pages 106-107 intentionally omitted] Mr. Justice SUTHERLAND delivered the opinion of the Court.

This appeal brings here for consideration a challenge to the constitutionality of an act of the Pennsylvania Legislature approved May 13, 1927, Pa. St. Supp. 1928, §§ 9377as-1, 9377a-2, a copy of which will be found in the margin.¹ The act provides that every pharmacy or drug store shall be owned only by a licensed pharmacist, and, in the case of corporations, associations and co- partnerships, requires that all the partners or members thereof shall be licensed pharmacists, with the exception that such corporations as are already organized and existing and duly authorized and empowered to do business in the state and own and conduct drug stores or pharmacies, and associations and partnerships, which, at the time of the passage of the act, still own and conduct drug stores or pharmacies, may continue to own and conduct the same.

The appellant is a Massachusetts corporation authorized to do business in Pennsylvania. At the time of the passage of the act, appellant was empowered to own and conduct and owned and thereafter continued to own and operate a number of pharmacies or drug stores at various places within the latter state. After the passage of the act, appellant purchased and took possession of two addi- tional drug stores in that state and carried on and continues and intends to continue a carry on a retail drug business therein under the title of 'drug store' or 'pharmacy,' including the compounding, dispensing, preparation and sale at retail of drugs, medicines, etc. The business was and is carried on through pharmacists employed by appellant and duly registered in accordance with the statutes of the state. All of the members (stockholders) of the appellant corporation are not registered pharmacists, and, in accordance with the provisions of the act, the Pennsylvania State Board of Pharmacy has refused to grant appellant a permit to carry on the business. It further appears that the state Attorney General and the district attorney of the proper county have threatened and intend to and will prosecute appellant for its violation of the act, the penalties for which are severe and cumulative. Suit was brought to enjoin these officers from putting into effect their threats, upon the ground that the act in question contravenes the due process and equal protection clauses of the Fourteenth Amendment. It is clear from the pleadings and the record, and it is conceded, that if the act be unconstitutional as claimed, appellant is entitled to the relief prayed. Terrace v. Thompson, 263 U. S. 197, 215, 44 S. Ct. 15, 68 L. Ed. 255; Ex parte Young, 209 U. S. 123, 28 S. Ct. 441, 52 L. Ed. 714, 13 L. R. A. (N. S.) 932, 14 Ann. Cas. 764.

The court below, composed of three judges, heard the case upon the pleadings, affidavits and an agreed statement of facts, and rendered a decree denying a preliminary injunction and, upon the agreed submission of the case, a final decree dismissing the bill for want of equity. (D. C.) 22 F.(2d) 993. The statute was held constitutional upon the ground that there was a substantial relation to the public interest in the ownership of a drug store where prescriptions were compounded. In support of this conclusion, the court said that medicines must be in the store before they can be dispensed; that what is there is dic- tated not by the judgment of the pharmacist buy by those who have the financial control of the business; that the Legislature may have thought that a corporate owner in purchasing drugs might give greater regard to price than the quality, and that if such was the thought of the Legislature the court would not undertake to say that it was without a valid connection with the public interest and so unreasonable as to render the statute invalid.

That appellant's business is a property right (Duplex Co. v. Deering, 254 U. S. 443, 465, 41 S. Ct. 172, 65 L. Ed. 349, 16 A. L. R. 196; Truax v. Corrigan, 257 U. S. 312, 327, 42 S. Ct. 124, 66 L. Ed. 254, 27 A. L. R. 375), and as such entitled to protection against state legislation in contravention of the federal Constitution, is, of course, clear. That a corporation is a 'person' within the meaning of the due process and equal protection clauses of the Fourteenth Amendment, and that a foreign corporation permitted to do business in a state may not be subjected to state statutes in conflict with the federal Constitution, is equally well settled. Kentucky Co. v. Paramount Exch., 262 U. S. 544, 550, 43 S. Ct. 636, 67 L. Ed. 1112; Power Co. v. Saunders, 274 U. S. 490, 493, 496, 497, 47 S. Ct. 678, 71 L. Ed. 1165; Frost Trucking Co. v. R. R. Com., 271 U. S. 583, 594 et seq., 46 S. Ct. 605, 70 L. Ed. 1101, 47 A. L. R. 457. And, unless justified as a valid exercise of the police power, the act assailed must be declared unconstitutional because the enforcement thereof will deprive appellant of its property without due process of law.

The act is sought to be sustained specifically upon the ground that it is reasonably calculated to promote the public health; and the determination we are called upon to make is whether the act has a real and substantial relation to that end or is a clear and arbitrary invasion of appellant's property rights guaranteed by the Constitution. See Adair v. United States, 208 U. S. 161, 173, 174, 28 S. Ct. 277, 52 L. Ed. 436, 13 Ann. Cas. 764; Mugler v. Kansas, 123 U. S. 623, 661, 8 S. Ct. 273, 31 L. Ed. 205. The police power may be exerted in the form of state legislation where otherwise the effect may be to invade rights guaranteed by the Fourteenth Amendment only when such legislation bears a real and substantial relation to the public health, safety, morals, or some other phase of the general welfare. Here the pertinent question is: What is the effect of mere ownership of a drug store in respect of the public health?

A state undoubtedly may regulate the prescription, compounding of prescriptions, purchase and sale of medicines, by appropriate legislation to the extent reasonably necessary to protect the public health. And this the Pennsylvania Legislature sought to do by various statutory provisions in force long before the enactment of the statute under review. Briefly stated, these provisions are: No one but a licensed physician may practice medicine or prescribe remedies for sickness;² no one but a registered pharmacist lawfully may have charge of a drug store;³ every drug store must itself be registered, and this can only be done where the management is in charge of a registered pharmacist;⁴ stringent provision is made to prevent the possession or sale of any impure drug or any below the standard, strength, quality and purity as determined by the recognized pharmacopoeia of the United States;⁵ none but a registered pharmacist is permitted to compound physician's prescriptions;⁶ and finally, the supervision of the foregoing matters and the enforcement of the laws in respect thereof are in the hands of the State Board of Pharmacy, which is given broad powers for these purposes.

It therefore, will be seen that without violating laws, the validity of which is conceded, the owner of a drug store, whether a registered pharmacist or not, cannot purchase or dispense impure or inferior medicines; he cannot unless he be a licensed physician, prescribe for the sick; he cannot unless be he a registered pharmacist, have charge of a drug store or compound a prescription. Thus, it would seem, every point at which the public health is likely to be injuriously affected by the act of the owner in buying, compounding, or selling drugs and medicines is amply safeguarded.

The act under review does not deal with any of the things covered by the prior statutes above enumerated. It deals in terms only with ownership. It plainly forbids the exercise of an ordinary property right and, on its face, denies what the Constitution guarantees. A state cannot, 'under the...