Kent Chandler, in His Official Capacity as Chairman and Commissioner of Kentucky Public Service Commission, et al. v. Foresight Coal Sales, LLC

The dormant Commerce Clause is meant to prevent economic isolation among the States. But just how far does that go? The Sixth Circuit held that a Kentucky law likely violates the doctrine. The law directs a state agency not to consider any jurisdiction’s coal-severance tax in assessing the reasonableness of a utility company’s fuel costs (which the agency does to help ensure customers pay a fair price). In the lower court’s view, the law discriminates against interstate commerce at least in its practical effect and purpose. The court did not say whether it thought the law also discriminates on its face. So the case presents the overarching question: does the law discriminate against interstate commerce in violation of the dormant Commerce Clause? But the lower court’s holdings also present three subsidiary, more specific questions on the scope of the dormant Commerce Clause. First, does a law discriminate against interstate commerce in practical effect when there has been no showing of any burden on interstate commerce beyond a de minimis one? Second, can a law so discriminate when it only offsets a state-imposed disadvantage, does so equally for all States imposing that disadvantage, and does not affect any out-of-state business’s earned or natural advantage? And third, does discriminatory purpose matter in determining whether a law violates the dormant Commerce Clause and, if so, does the law here have such a purpose?