Tyson v. Banton
"Tyson v. Banton" is a significant Supreme Court case from the 1920s that revolved around the regulation of theater ticket resales in New York. The case emerged after the New York State legislature enacted a statute aimed at protecting consumers from excessive ticket prices. The Supreme Court, in a narrow 5-4 decision, ruled that the law infringed upon the freedom of enterprise guaranteed by the Fourteenth Amendment. Justice George Sutherland, writing for the majority, argued that the government could only exercise its regulatory powers over businesses deemed to be of "public interest," a standard he believed theater ticket sales did not meet due to their limited audience.
In contrast, the dissenting justices contended that the state should have the authority to regulate all private businesses to safeguard the welfare of citizens. This case highlighted the ongoing debate about the extent of state regulation versus individual business freedoms in the United States. Notably, the perspectives expressed in "Tyson v. Banton" would evolve over the following years, as seen in the later case of "Nebbia v. New York," where the court's stance on regulation broadened. The decision reflects the complex interplay between government oversight and economic liberties during a pivotal era in American legal history.
Tyson v. Banton
Date: February 28, 1927
Citation: 273 U.S. 418
Issue: Regulation of business
Significance: Reaffirming that the states could regulate only “business affected with a public interest,” the Supreme Court overturned a law restricting ticket scalping.
During the 1920’s the New York State legislature passed a statute to protect the public against excessive charges in the resale of theater tickets. By a 5-4 vote, the Supreme Court ruled that the law violated a substantive freedom of enterprise, which was protected by the Fourteenth Amendment. Justice George Sutherland’s opinion for the majority was based on the theory that government could use its police power only to regulate those businesses that were “affected with a public interest.” Using the narrow definition of such businesses in Wolff Packing Co. v. Court of Industrial Relations (1923), Sutherland observed that only a small percentage of the public went to theaters and that the business of selling theater tickets was not an essential service in the economy. The dissenters rejected the idea that only some businesses were of interest to the public, and they argued that state legislatures should be able to use their police powers to regulate any private business to promote the welfare of their citizens. In 1934 the majority of the justices would accept the view of the dissenters in the landmark case of Nebbia v. New York.
