GIBBONS
V. OGDEN
In Gibbons v. Ogden (1824), the Supreme Court defined Congress’s constitutional power to regulate interstate commerce. Rival steamboat ferries were operating between New Jersey and New York. Aaron Ogden operated his ferry under a state monopoly granted by the New York state legislature. Thomas Gibbons, formerly Ogden’s partner, secured a federal license to operate under the Federal Coasting Act of 1793 and competed with him.
Ogden sued Gibbons in New York,
asking the court to restrain Gibbons from operating his boats. Ogden’s lawyer
contended that states often passed laws on issues regarding interstate matters
and that states should have fully concurrent power with Congress on issues
concerning interstate commerce. The monopoly, therefore, should be upheld.
Gibbons’s lawyer, Daniel Webster, argued that Congress had exclusive national power over interstate commerce according to Article I, Section 8 of the Constitution and that to argue otherwise would result in confusing and contradictory local regulatory policies.
The New York court confirmed Ogden’s monopoly and ordered Gibbons to stop his service. Gibbons then appealed to the U.S. Supreme Court.
Chief Justice John Marshall delivered the Supreme Court’s opinion, stating that Gibbons’s federal license was valid. National law had to be considered superior to state law when the two conflicted. If state powers were broad and Congress’s narrow, it would leave the Constitution “a magnificent structure, indeed, to look at, but totally unfit for use.” Marshall’s interpretation rested on the federal government’s constitutional power to regulate interstate commerce, which Marshall defined broadly as intercourse; in other words, commerce did not simply mean buying and selling commodities, but also navigation and other forms of business interaction. Thus Gibbons became the basis in later years for Congress’s regulation of all interstate communication, from navigation to radio and television.
http://www.landmarkcases.org/gibbons/background3.html