When one legal right infringes upon another legal right who wins? Lower courts may make a decision only to be appealed to the Supreme Court. And no matter what the lower courts have decided the Supreme Court can overrule their decision. This was the first case to establish that supremacy.
What's at Stake
Interstate Commerce, Intrastate Commerce, Federal Supremacy v. State’s Rights
Who was Gibbons?
Thomas Gibbons was a commercial steamboat operator sailing within the waters of New York.
Who was Ogden?
Aaron Ogden was also a commercial steamboat operator but was sailing between New York and New Jersey.
Both Gibbons and Ogden had separate shipping businesses with a port in New York. Ogden purchased a franchise license from Robert Livingston and Robert Fulton who were granted a 20-year monopoly from New York state to navigate waters in and around New York.Gibbons, on the other hand, obtained his license from the United States federal government to operate between New York and New Jersey.
Ogden sued Gibbons saying that he, Ogden, had a legitimate franchise operation that excluded any competition. The New York courts agreed. Gibbons counter-sued saying that his federal license superseded Ogden’s state license. The case wound up in the US Supreme Court.
Chief Justice John Marshal split the difference. While Congress can regulate interstate commerce (commercial trade between states) it cannot regulate intrastate commerce (commercial trade within only one state).
But the Court’s ruling extended to all interstate commerce whether it occurred on a stagecoach, boat, train or within a factory itself making a product for transportation between states.
So, this decision established for the first time the legality of the Constitution’s Supremacy Clause to control interstate commerce as well as affirming the states’ rights to control their own internal commerce.
Unanimous decision 6-0 in favor of Aaron Ogden.
The original agreement between New York and Misters Livingston and Fulton was based on those two inventing a commercial grade steamship that would travel no less than 4 mph. Later in life Fulton was also involved in building a submarine and a steel-hulled war ship and designed a system of inland waterways using canals. Livingston was the first Chancellor of the state of New York and was part of the Committee-of-Five which first outlined, and then reviewed, Thomas Jefferson ‘s first draft of the Declaration of Independence.