## Facts

- H.P. Hood & Sons, Inc., a Massachusetts milk distributor, operated three licensed milk-receiving plants in New York and shipped most milk acquired there to the Boston market.
- Hood applied to New York’s Commissioner of Agriculture and Markets for a license to open a fourth milk-receiving station in Greenwich, New York.
- New York law required a license for milk-receiving plants and allowed denial if issuance would not be in the “public interest,” would cause “destructive competition,” or would unduly hamper competition in local markets.
- After hearings, the Commissioner denied the license, finding the new plant would reduce milk available for local markets and create destructive competition in a market “already adequately served.”
- The denial was not based on sanitary, health, safety, or product-quality concerns.
- The New York Court of Appeals upheld the denial against a Commerce Clause challenge.
- The U.S. Supreme Court granted review.

## Issues

1. Whether New York violated the Commerce Clause by denying a milk-receiving plant license to prevent “destructive competition” and preserve local milk supplies, thereby restricting an interstate enterprise for local economic protection.

## Decision

- The Supreme Court reversed the New York Court of Appeals.
- The Court held that New York’s denial, as applied, violated the Commerce Clause because its practical effect was to hamper and curtail interstate commerce to insulate the local market from competition.
- The Court rejected New York’s claim that federal agricultural marketing policy authorized the protectionist restraint.
- Dissenting Justices would have deferred to the state’s economic judgment and viewed the licensing criteria as nondiscriminatory on their face.

## Legal Principles

- A state may not promote local economic advantages by curtailing the volume of interstate commerce.
- Even when a statute is framed in neutral terms (e.g., “public interest” or “destructive competition”), it is unconstitutional as applied if its purpose or practical effect is economic protectionism that restrains interstate trade.
- State police-power regulation of milk (sanitation, quality, health, safety) is permissible, but those regulatory forms cannot be used to suppress competition in interstate commerce.
- A state cannot justify protectionist restraints by invoking compatibility with federal agricultural marketing law when the state action conflicts with the federal aim of facilitating interstate marketing.
- Existing, unrestricted access to operate other facilities does not validate a state’s deliberate restriction of additional interstate operations to protect local markets.

## Conclusion

New York’s license denial was unconstitutional because it used state licensing authority to limit an out-of-state distributor’s access to local milk for interstate shipment in order to protect local economic interests, a restraint the Commerce Clause forbids.


H.P. Hood & Sons, Inc. v. Du Mond, 336 U.S. 525 (1949)