Amicus Curiae Brief — Caldwell v. Sioux Falls Stock Yards Co.

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GTi AA Bh me Sk OED Pe Rnd

IN THE

Supreme Court of the United States

October Term 1915.

No. 860.

Caldwell v. Sioux Falls Stock Yards Company.

No. 900.

Herrick v. Halsey and Company.

No. 941

Hall, etc., v. The Geiger Jones Company.

No. 942.

Hall, etc., v. Coultrap.

No. 943.

Hall, ete., et al v. Rose, et al.

#

Appeals from the Districts Courts of the United States _

of Michigan, South Dakota and Ohio.

MOTION FOR LEAVE TO FILE BRIEF

AMICI CURIAE.

Come now Grant Fellows, attorney general of Michi-

gan, George Cosson, attorney general of Iowa, and Ed- é

ward C. Turner, attorney general of Ohio, as a duly ap- ©

pointed committee of the National Association of At-

*

torneys General and respectfully seek permission to file

a brief in the above entitled causes as amici curiae.

Said causes involve the constitutionality of the so-

called Blue Sky Laws of Ohio, Michigan and South

Dakota.

More than twenty states have enacted similar legis-

islation.

After the Federal Distriet Courts of Towa and Michi-

gan had declared the original Blue Sky Laws of Iowa

and Michigan unconstitutional, ‘the National Associa-

tion of Attorneys General appointed a committee to

draft a model law. This committee which was composed

of Attorneys General Moose of Arkansas, Fellows of

Michigan, and Cosson of Iowa, reported a model Blue

Sky Law to the National Association of Attorneys Gen-

eral on December 28, 1914. This model has been fol-

lowed in the laws adopted by a number of the states, in-

eluding Michigan and South Dakota.

All of said legislation seeks to protect the citizens

of the various states from fraud in the sale of alleged

securities.

As the decision in any one of the above entitled causes

will in all probability be determinative of the validity

of similar laws in other states, we respectfully suggest

that this committee, appointed for the purpose by Hon-

orable James P. Tuttle, attorney general of New Hamp-

shire, president of the National Association of Attorneys

General, be granted permission to file a brief discussing

the general principles underlying this class of legislation.

GRANT FELLOWS,

Attorney General of Michigan.

GEORGE COSSON,

Attorney General of Iowa.

EDWARD C. TURNER,

Attorney General of Ohio.

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WO 1A satin bay dom “ FTA niles

IN THE

Supreme Court of the United States

OCTOBER TERM, A. D. 1915

SIOUX FALLS STOCK YARDS COM-

PANY, a Corporation, WILLIAM MOR-

LEY and HARKY MORLEY,

Plointif—fs ane Re xpondents,

Vs.

CLARENCE €(. CALDWELL, as Attorney

General for the State of South Dakota

and Ex-Officio Member of the State Se-

curities Commission of the State of

South Dakota; HARRY O'BRIEN, as

Insurance Commissioner of the State of

South Dakota, and Ex-Officio Member

of the State Securities Commission of

the State of South Dakota; JOSEPH L.

WINGFIELD, as Public Examiner of

the State of South Dakota and Ex-Of-

ficio Member of the State Securities

Commission, and DAN E. HANSON, as

State’s Attorney of Turner County,

South Dakota,

Defendants and Appellants.

Appeal From the District Court of the United States,

District of South Dakota, Eastern Division.

MOTION TO ADVANCE

Now come the appellants, and move the Court to ad-

vance the above entitled cause for hearing and argument

to an early date convenient to the Court.

In support of the motion to advance appellants re-

spectfully show to the Court:

This action was brought by respondents in the

United States District Court for the District of South

Dakota for the purpose of obtaining a permanent in-

junction against said appellants restraining said ap-

ee Dek ks Bed a

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pellants from instituting criminal actions against re-

spondents for violation of Chapter 275, of the Session

Laws of the State of South Dakota for the vear 1915.

An application was made by respondents to the Judge

of said Court for a temporary or interlocutory injunction

during the pendency of said action. A hearing was had

upon the application of respondents for such interlocu-

tory injunction under the provisions of Section 266, of

the Act of Congress entitled “An act to codify, revise and

amend the laws relating to the Judiciary,” approved

March 3, 1911’, as amended by Act of March 4, 1918

(37 Stat. L. 1013). The Judge of the District Court

called to his assistance to hear and determine the appli-

cation, two other Judges, as provided by said. statute,

namely, United States Circuit Court Judge Walter HI.

Sanborn, and United States District Judge Thos. ©.

Munger, and an order was made in said cause by the

said Judges, which granted the application of respondent

for an interlocutory injunction, and which restrained ap-

pellants from instituting and prosecuting any actions,

civil or criminal, against respondents under the afore-

said act of the Legislature of the State of South Dakota.

for alleged violations thereof, and from taking any pro-

ceedings for the enforcement of said act, against the said

respondents. From this interlocutory order of injune-

tion appellants have appealed to the Supreme Court of

the United States.

The South Dakota act in question (Session Laws of

1915, page 657) is popularly known as a “Blue Sky

Law.” It was passed at the 1915 session of the Legisla-

ture of South Dakota, was approved March 15, 1915, and

went into effect on July 1, 1915. This act creates “A

State Securities Commission’ to consist of the Public

Examiner, the Attorney General and Commissioner of

Insurance. It requires every person, corporation, co-

partnership, company or association, except those ex-

empted under the provisions of the act, before selling,

offering for sale, taking subscriptions for or negotiating

for the sale in any manner whatsoever, in the State of

South Dakota, any stocks, bonds. investnents, contracts

or other securities, of its own issue, to make application

for a license or permit, and submit certain information

and data prescribed by this statute to the said State Se-

—

AN arian

Soe imtin MORNE ite vt ae were al OP he ate ie ie

curities Commission, and to pay a filing fee prescribed

by this statute. The said State Securities Commission

shall hear such application, and if in the opinion of such

Commission the sale of such contracts, stock, bonds or

other securities would work a fraud upon the purchaser,

the Commission is authorized to disapprove the sale of

same. Lf, however, said Commission shall not find that

the proposed plan of business, or the proposed contracts,

stocks, bonds or other securities are fraudulent, or are

of such a nature that the sale of such contracts, stocks,

bonds er other securities would in the opinion of the

Commission work a fraud upen the purchaser thereof,

then it is authorized to approve the sale of the same in

the State of South Dakota, and issue its certificate to

that effect. It is made unlawful for any investment

company or dealer or representative thereof, to sell, take

subscriptions for or negotiate for the sale in any manner

whatever in South Dakota, any stocks, bonds, investment

contracts or other securities, unless and until the said

Commission has approved thereof and issued its certi-

ficaie in accordance with the provisions of the statnte:

Penalties by fine and imprisonment in the county jail are

prescribed for violations of the aet.

Respondent's Bill of Complaint and Application

shows that the complaint, the Sioux Falls Stock Yards

Company, is a corporation of the state of Colorado, and

that the complainants, William Morley and Harry Mor-

ley, are residents and citizens of the State of Towa. That

during the year 1915, beth before and after July Ist, of

that year, the Sienx Falls Stock Yards Company was en-

eaged in the business of building and constructing a

stock yards in the City of Sioux Falls, Minnehaha coun-

ty, South Dakota, and was engaged at such time in sell-

ing certain of its capital stock for the purpose of raising

sufticient capital to complete the construction of its said

stock yards in the City of Sioux Falls. That the com-

plaints, William Morley and Harry Morley were at such

times engaged in the business of selling the stock of the

Sioux Falls Stock Yards Company within the state of

South Dakota. That in October, 1915, the defendant,

Dan FE. Hanson, as State's Attorney of the County of

Turner, and State of South Dakota, at the instigation

and request of the other defendants as members of the

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State Securities Commission, caused to be instituted

against the complainants criminal proceedings for the

Violation of the provisions of said Chapter 275, Session

Laws of South Dakota for the year 1915, and that the

defendants intend and will continue to prosecute the

complainants for violations of said statute so long as

complainants sell or offer for sale any stock of the Sioux

Falls Stock Yards Company within the state of South

Dakota. The complainants desire to continue the sale

of the securities and stocks of the said Sioux Falls Stock

Yards Company within the State of South Dakota, and

that the business of said corporation cannot be promoted

Without the continued sale of its stock. That the acts

of defendants under said chapter 275 are depriving com-

plainants of the right to sell the capital stock of said

Sioux Falls Stock Yards Company within the State of

South Dakota, and deprives them of their property with-

out due process of law in violation of Section 1 of Article

14 of the Constitution of the United States and Section

2 of Article 6, Constitution of the State of South Da-

kota; that there is thereby denied to the complainants

the equal protection of the laws as guaranteed to them

by the Fourteenth amendment to the Federal Constitu-

tion; that the law imposes a burden upon and practically,

prohibits interstate commerce, contrary to Section & of

Article 1, of the Constitution of the United States, and

said statutes attempt to vest and delegate to the said

State Securities Commission judicial powers unauthor-

ized by law.

The hearing for the interlocutory injunction was

had upon the Bill of Complaint, which constituted the

showing and application for the complainants. The ap-

pellants conceded the correctness of the facts alleged by

complainants but contended that same did not constitute

grounds for an injunction, thus in effee¢t demurring to

the application of complainants. The Covrt rendered no

formal opinion but in the interlocutory injunction Order

hereinbefore described, made a finding that Chapter 275,

Session Laws of South Dakota for the vear 1915, was

violative of the Constitution of the United States, basing

such finding in the order upon the decisions in Alabama

& No. Transportation Co. vs. Doyle, 210 Fed. 173, Win.

R. Compton Co, vs. Allen et al, 216 Federal 537, and

Bracey vs. Darst. 218 Federal 482. The issue upen the

appeal to this Court as made by the pleadings and record

and the decision of the lower Court, is as to the consti

tionality under the Federal Constitution of the said

South Dakota Statute.

As reason why it is especially urgent and desirable

that the cause in this Court be advanced to an early

hearing, appellants enumerate the following:

1. That the issues and questions invelyed in’ this

appeal are matters of public concern to all the people of

South Dakota in that they involve the validity of the

statute regularly passed and approved, and designed .ty

protect the public against fraud,

2. That public officers of the state are charged with

the administration and enforcement of this statute, and

such administration and enforcement is) seriously em-

barrassed by the question as to the validity of such stat-

utes raised by the decision of the Federal District Court.

3. That such officers are compelled to take the risk

of enforcing an invalid statute, or of allowing a valid

statute to remain ignored and uninforced until its: va-

lidity is determined,

4. That such officers believing in the validity and

constitutjonality of the statute are insisting upen its en-

forcement except as they have been restrained by the

Court as to the complaints in this case.

>. That investment companies and persons dealing

in stocks, bonds and other securities within the State of

South Dakota, are being compelled to submit to the

provisions of a statute which may be determined to he

unconstitutional and void, or to determine for themselves

at their peril that same iy unconstitutional and void, and

take the risk of subjecting themselves to the penalties

provided therein.

6. That the situation during the pendency of this

appeal, and until the validity and constitutionality of

said statute is finally determined, is such as will likely

create a multiplicity of suits because of the uncertainty

with reference to the validity of the law.

7. That the business of dealing in stocks, bonds and

securities of investment companies is very extensive

threnghout the state of South Dakota; that the number

of people engaged in selling stocks and securities of in-

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vestment companies is large, all of whom will be directly

affected in the determination of the question of the va-

lidity of such law. That the business of selling such

stocks and securities reaches throughout the entire state

in all sections thereof, and extends to all classes of peo-

ple, and the administration of the law affects the entire

people of the state.

8. That more than twenty states of the United

States have passed blue sky laws in some form. That the

question as to the power of the states to protect its peo-

ple from fraud in the sale of stocks and securities under

these laws is a new question but one of the greatest im-

portance to the people throughout all of these various

states. That the demand and need for legislation alone

this line is shown by the passage of laws to this end in

sO many states. That it is important and urgent in

order to protect the public from fraud that the scope of

the authority of the states under the Federal Constitu-

tion to legislate along these lines. be determined to the

end that power and valid legislation may be secured as

far as possible from the states, and to the end that the

people, through Congress may supply the needed legist-

tion along these lines where the power to legislate is

denied the states.

WHEREFORE, Appellants respectfully submit their

Motion together with the foregoing reasons in) suppert

thereof,

CLARENCE C. CALDWELL,

Attorney General,

BYRON S. PAYNE,

Asst. Attorney General,

Solicitors for Appellants.

The plaintiffs and respondents in the above entitled

action hereby join in the foregoing motion to advance,

and respectfully ask that said motion be granted. and

they hereby waive all notice of hearing of the same.

R. J. GAMBLE, FE. E. WAGNER, and

GEORGE J. DANFORTH,

Solicitors for Respondents

4

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560 OCTOBER TERM, 1916.

Argument for Appellees. 242 U.S.

constitutional and its effect, if the business be continued in disre-

gard of it, will be to visit him with repeated criminal prosecutions

involving heavy fines and imprisonment, the remedy at law is not

adequate.

A suit to enjoin state officials from instituting criminal proceedings in

enforcement of such a statute is not a suit against the State.

Reversed. For decree below see 230 Fed. Rep. 236, note.

THE case is stated in the opinion.

Mr. Clarence C. Caldwell, Attorney General of the State

of South Dakota, with whom Mr. Byron S. Payne, <As-

sistant Attorney General of the State of South Dakota,

was on the brief, for appellants.

Mr. George J. Danforth, with whom Mr. Hugh S. Gamble,

Mr. Frank McLaughlin and Mr. Edward E. Wagner were

on the brief, for appellees:

The act denies to the appellees due process of law, in

violation of the Fourteenth Amendment and the South

Dakota constitution, § 2, Article 6.

A complete analysis of its provisions shows that this

is not a law to prevent fraud in the sale of stocks and

bonds. It is a law designed for the sole purpose of regu-

lating the control of the sale of stocks and bonds to a point

of absolute prohibition. The stocks and bonds that are

sold under the permit given by the commission are no

more protected against the fraud and deceit of the agent

in selling them than are those that are sold without a

permit. The law is purely an attempt to regulate profit

and loss and to try to guarantee the citizens of South

Dakota against a possible mistake in judgment. It is

simply an effort to prevent the citizens of this State from

entering into a legitimate enterprise for gain, if they so

desire, and to guard their pocketbooks. The law does not

provide any penalty for fraud, but simply contains a

prohibition against and provides a penalty for tendering

for sale an article of commerce, however honestly it may

PRRs sci snes no nttnen wiv co Pee any a AB AA 2D

CALDWELL ». SIOUX FALLS STOC ‘KK YARDS CO. 561

242 U.S. Argument for Appellees.

be tendered. Herein lies the vice of the statute, and

herein does it differ from all laws regulating commercial

transactions, which have been upheld by the court under

the guise of police regulations.

The State Securities Commission is not merely an ad-

ministrative board vested with certain discretionary

powers, but is rather a court before which evidence must

be taken, examined and weighed, and with authority

greater than was ever conferred upon any judicial tribunal

in this country.

The very right to make a contract is taken away from

the individual unless the individual or corporation or asso-

ciation receives the stamp of approval of the commission

upon the contract.

For a century or more the business of trading in horses

has been recognized as a line of business in which fraud

was frequently practiced. There would be just as much

sense in having the State Securities Commission put its

stamp of approval upon every horse trade as there would q

be to have it set up its judgment against the skilled in- ;

vestor, simply because an occasional person has lost his

money by reason of a stock transaction. Ex parte Hawley,

22 8. Dak. 23. ;

The act is an unlawful interference with interstate com- ;

merce. Catlin & Powell v. Schuppert, 110 N. W. Rep. 818;

Hatch v. Reardon, 204 U. 8. 152 ; International Textbook

Co. v. Pigg; 217 U.S. 91.

The statute denies to the appellees the equal protection

of the law. It exempts state and national banks and loan

associations and certain other classes.

The act attempts to delegate both legislative and judi-

cial power to the State Securities Commission, and is not

an inspection law. Phenix Insurance Co. y. Perkins, 101

N. W. Rep. 1110; Stour Falls v. Kirby, 6 S. Dak. 62;

Hewitt v. Board of Medical Examiners, 84 Pac. Rep. 39;

Mathews v. Murphy, 63 8. W. Rep. 785.

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PE NEL Fs LOGIN

562 OCTOBER TERM, 1916.

Opinion of the Court. 242 U.S.

In the case at bar, the law distinctly provides that all

that is necessary for the Securities Commission to find is

that in its opinion the sale of stocks, bonds, ete., might

work fraud upon the purchaser. A pure and absolute

discretionary power is given to the commission. First,

as to the granting of the permit, and, Second, as to the

revocation of the permit after it is granted. There is no

standard fixed to guide the commission in granting the

permit, nor is there any standard prescribed as the reason

for the revocation of the permit.

Mr. George Cosson, Attorney General of the State of

Iowa, and Mr. Walter C. Owen, Attorney General of the

State of Wisconsin, by leave of court, filed a brief as amici

curie on behalf of the National Association of Attorneys

General of the United States.

Mr. Justice McKenna delivered the opinion of the

court.

This case was argued and submitted with Nos. 438, 439

and 440, just decided, ante, 539, and with No. 413, post,

568, which concerns a statute of Michigan of like kind, the

opinion in which is to follow. It involves the same general

questions as those cases and is presented to review a decree

of the District Court enjoining appellants from enforeing a

statute of the State of South Dakota relating to the sale of

securities. The act ($ 23) makes violations of its provi-

sions a misdemeanor and criminal prosecutions under the

act were the particular actions of the officers of the State

that the appellees prayed to be enjoined.

After a consideration of the pleadings and argument the

court, consisting of three judges, expressed the view that

the statute violated the Constitution of the United States,

and cited in confirmation Alabama & N.O. Transportation

Co. v. Doyle, 210 Fed. Rep. 173; Wm. R. Compton Co. v.

CALDWELL »v. SIOUX FALLS STOCK YARDs CO. 563

242 U.S. Opinion of the Court.

Allen, 216 Fed. Rep. 537, and Bracey v. Darst, 218 Fed.

Rep. 482.

The court decreed that the appellants be enjoined from

instituting and prosecuting any actions, civil or criminal,

against complainants (appellees) under the statute for

alleged violations thereof, and from taking any proceed-

ings for its enforcement except such as might be deemed

proper by them in the criminal actions already pending.

The Sioux Falls Stock Yards Company is a Colorado

corporation, having its principal place of business at the

City of Denver, and the Morleys are residents and citizens

of Iowa.

The Stock Yards Company was at the times mentioned

in the bill engaged in building and constructing a stock

yard in Sioux Falls, South Dakota, and in selling a certain

amount of its capital stock for raising sufficient capital for

that purpose. The Morleys, at such time, were engaged in

the buying and selling of stock and especially in selling the

stock of the Stock Yards Company to various farmers and

other purchasers, such sales being necessary to complete

the construction of the stock yard and also necessary to

enable the Morleys to earn a livelihood.

Six informations were filed against appellees at the

instigation of appellants for violations of the statute and

it is alleged that appellees will be prosecuted immediately

under such informations and will be further prosecuted.

The statute, it is alleged, is an infraction of the Four-

teenth Amendment of the Constitution of the United

States and imposes a burden upon and practically amounts

to a prohibition of interstate commerce and hence offends

the commerce clause of the Constitution of the United

States; and “that it attempts to vest in and delegate to

the said so-called State Securities Commission judicial

powers unauthorized by law.”

Against the bill appellants urge, besides asserting the

validity of the statute, three defenses: (1) That com-

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So ates eee D TR RS

504 OCTOBER TERM, 1916.

Opinion of the Court. 242 U.S.

plainants have a plain, speedy and adequate remedy at

law; (2) the suit is one against the State; (3) that the plea

of the unconstitutionality of the statute was made in the

criminal actions.

The three defenses are without merit. Six informations

have already been filed against appellees and as many

more may be brought as there may be violations of the

statute, and a conviction of each may bear a fine of $1000

or imprisonment, or both.

The suit manifestly is not one against the State, and

the decree appealed from does not enjoin criminal actions

commenced before the filing of the bill. We therefore

pass to the merits.

A summary of the statute is all that is necessary. Its

purpose as declared in its title is to prevent fraud in the

sale and disposition of stocks, bonds or other securities

sold or offered for sale within the State. It creates a com-

mission called the State Securities Commission, of which

the appellants—except Hanson, who is prosecuting attor-

ney of Turner County—are members.

Those dealing in securities—and they may be persons,

corporations, co-partnerships, companies or associations,

incorporated or unincorporated—shall be known, it is

provided, ‘‘as a domestic investment company.”’ Those

resident of or organized in any other State, Territory or

government shall be known ‘‘as a foreign investment

company.”

Certain securities are exempt from the provisions of the

act and information as to those to which it applies must

be furnished to the commission as follows: If the securities

are of the dealer’s own issue a statement must be filed with

the commission showing in full detail (1) the plan upon

which it proposes to transact business, (2) a copy of all

contracts, stocks and bonds which it proposes to make with

or sell to contributors or customers, together with a copy

of its prospectus and of the proposed advertisements of its

<a

_ euamaaammenemrsss ————

CALDWELL v. SIOUX FALLS STOCK YARDS CO. 505

242 U.S. Opinion of the Court.

securities; which statement shall also show its name and

location and main office; (3) the names and addresses of

its officers and an itemized account of its financial condi-

tion and the amount of its assets and liabilities; (4) such

other information as the commission may require; (5) if a

foreign corporation, a copy of the law under which it was

incorporated; (6) a copy of its charter and certain other

papers relating to its constitution and organization. A

filing fee is provided for of not less than $10 nor more than

$100. The described papers are to be verified and, if of

record, certified to. Ifa foreign corporation, the applicant

must file its irrevocable consent to suits against it by serv-

ice of summons upon the public examiner.

The commission is authorized to require further infor-

mation than that mentioned above and to make an

appraisal of the property of the applicant at the expense of

the applicant.

If the commission find from the statements filed and the

reports of the investigations conducted by it that the

securities or investment contracts offered for sale would

in its opinion work a fraud upon the purchaser, the com-

mission shall disapprove of their sale and notify the com-

pany by registered mail of its findings and disapproval,

and it shall be unlawful for the company to sell such

securities and they shall not be sold in the State. If, how-

ever, the proposed plan of business and the securities are

not of that character their sale shall be approved and a

certificate issued of permission to sell.

The person who is authorized to sell the securities

designated in the act is termed a “dealer” in them, and

he shall not sell or offer them for sale until he shall have

filed a list of the same in the office of the commission. The

term “dealer,” it is provided, shall not include an owner

nor issuer of securities when the sale of them is not made

in the course of continued and successive transactions of

2 similar nature, nor one who in a trust capacity created

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566 OCTOBER TERM, 1916.

Opinion of the Court. 242 U.S.

by law lawfully sells securities ‘‘impressed with such

trust.”” A ‘‘dealer”’ is required to furnish practically the

same information as that required of corporations. <All

authorized agents of a ‘“‘dealer’’ or investment company

shall be registered with the commission and if the ‘‘dealer”

be a nonresident or a corporation other than a domestic

corporation he shall at the time he registers with the com-

mission file with it a written, duly authenticated appoint-

ment of the public examiner of the State as his or its agent

in the State upon whom process or pleadings may be

served for or on behalf of the ‘‘dealer,’”’ which appointment

shall be irrevocable. Upon compliance with the terms of

the act the commission shall issue to such “‘dealer’’ a

license which shall be good until revoked by the commis-

sion for good cause upon notice to the “‘dealer” and after a

hearing duly had.

There is a provision for keeping accounts, payment of

fines and other details, and it is provided that if, after

permission has been issued authorizing the sale of the

designated securities it shall be made to appear to the

commission from an examination of an investment com-

pany that the further sale of the securities would work a

fraud upon the purchaser, the commission may make an

order revoking the license of the company and, pending

the hearing, suspend the right of the company.

It is unlawful for a dealer or investment company to sell

or offer for sale securities other than those approved by the

commission or to transact business on any other plan than

that set forth in the statements and papers required to be

filed with the commission; or to circulate advertisements

or other documents in the State differing in any way from

the copy filed with the commission; or until the same has

been approved by the commission. And no dealer shall

sell or offer for sale securities of an investment com-

pany until such company has complied with the act.

He may, however, if such investment company has not

CALDWELL v. SIOUX FALLS STOCK YARDS CO. 567

242 U.S. Opinion of the Court.

itself complied with the act, make application for a

license.

Records of the commission shall be publie records and

they shall be so arranged and preserved as to facilitate

their examination, except that the commission may in its

discretion withhold information relating to the private

affairs of persons or corporations when in its judgment the

same shall not be required for the public welfare, or any

information relative to any matter that may be at issue

in any court, unless upon an order of the court. Except as

so provided the commission may furnish to those who may

apply therefor any information regarding any investment

company or its affairs.

Annual statements are required to be filed by invest-

ment companies, domestic or foreign, in such form and

containing such information as the commission may de-

mand; and failure to do so forfeits its permit.

The Supreme Court of the State upon petition of any

person aggrieved may review by certiorari any final order

or determination of the commission. The issue of the writ

shall not, however, unless specifically ordered by the

court, operate as a stay of proceedings.

Violations of the act are made misdemeanors punishable

by a fine of not more than $1000 or imprisonment for not

more than one year, or both fine and imprisonment. And

it is provided that if any section of the act be declared un-

constitutional or unauthorized the other sections shall not

be vacated thereby.

The statute of South Dakota differs in some details

from the statute of Ohio, but in its purpose and general

provisions it is the same. There is urged against it, as was

urged against the Ohio statute, that it violates the Four-

teenth Amendment and the commerce clause of the Con-

stitution of the United States. The argument to support

these contentions, while affluent in citation of cases, is

not so circumstantial as that which is presented against

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ELIE AE LES Re DE

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58 OCTOBER TERM, 1916.

Syllabus. 242 U.S.

the Michigan statute. Therefore, we shall rest this case

upon our opinion in Nos. 438, 439 and 440, reserving to the

Michigan case our reply to the more specific objections.

Decree reversed and cause remanded for further proceedings

in conformity with this opinion.

Mr. Justice McREYNOLDs dissents.