New State Ice Co. v. Liebmann - 285 U.S. 262, 52 S. Ct. 371 (1932)

Rule:

A regulation which has the effect of denying or unreasonably curtailing the common right to engage in a lawful private business cannot be upheld consistently with the Fourteenth Amendment. Under that amendment, nothing is more clearly settled than that it is beyond the power of a state, under the guise of protecting the public, arbitrarily to interfere with private business or prohibit lawful occupations or impose unreasonable and unnecessary restrictions upon them. 

Facts:

Appellant ice company brought a bill in equity to enjoin appellee competitor from engaging in the ice business in a particular place without having first procured a license. The ice company was licensed by the state, whose legislature had determined that the manufacture, sale, and distribution of ice was a public business. The district court dismissed the ice company's bill, and the United States Court of Appeals for the Tenth Circuit issued a decree sustaining the dismissal. The ice company appealed the decision. Appellant contended that its license or permit was a property right protected by the Fourteenth Amendment, and that the act providing for the license was presumptively valid. The Court affirmed the Court of Appeals' decree affirming the District Court's dismissal of the ice company's bill in equity.

Issue:

Did the trial court err in dismissing the bill for want of equity, on the ground that the regulation was violative of the Fourteenth Amendment?

Answer:

No.

Conclusion:

The United States Supreme Court stated that a regulation which had the effect of denying or unreasonably curtailing the common right to engage in a lawful private business, such as that under review, could not be upheld consistently with the Fourteenth Amendment, and that there was nothing in the product that the Court could perceive on which to rest a distinction, in respect of this attempted control, from other products in common use which entered into free competition. The Court noted that such unreasonable or arbitrary interference or restrictions could not be saved from the condemnation of the Fourteenth Amendment merely by calling them experimental legislation.