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Argument for Appellees.

commerce may to some extent be affected. Gibbons v. Ogden, 9 Wheat. 1; Gilman v. Philadelphia, 3 Wall. 713; Sherlock v. Alling, 93 U. S. 99; Escanaba Co. v. Chicago, 107 U. S. 678; Barbier v. Connolly, 113 U. S. 27; Walling v. Michigan, 116 U. S. 446; Philadelphia etc., S. S. Co. v. Penna., 122 U. S. 326; In Re Rahrer, 140 U. S. 545; Leloup v. Mobile, 127 U. S. 640; Hebe Co. v. Calvert, 246 Fed. 711; Missouri ex rel. Barrett v. Kansas National Gas Co., 265 U. S. 298; State v. Leary, 125 Atl. (R. I.) 353.

On various phases of legislation which have been declared within the reserved powers of States, and not a regulation of interstate commerce, see especially International Textbook Co. v. District of Columbia, 35 App. D. C. 307; Chicago R. I. & P. R. Co. v. Arkansas, 219 U.S. 453; Hennington v. Georgia, 163 U. S. 299; Nashville C. & St. L. R. Co. v. Alabama, 128 U. S. 96; United States v. Hart, Pet. C. C. 390; New Mex. ex rel. v. Denver & R. G. R. Co., 203 U. S. 38; Compagnie Francaise, Etc. v. Louisiana State Board, 186 U. S. 380; Hebe Co. v. Calvert, supra; Hendrick v. Maryland, 235 U. S. 610; Kane v. New Jersey, 242 U. S. 160; N. Y., N. H. & H. R. Co. v. New York, 165 U. S. 628; Sherlock v. Alling, 93 U. S. 99; Erie R. Co. v. Williams, 233 U. S. 685; Lakeshore & M. S. R. Co. v. Ohio, 173 U. S. 285; Texas Transport & T. Co. v. New Orleans, 264 U. S. 150; New York ex rel. Pa. Ry. Co. v. Knight, 192 U. S. 21.

The situation presented by the case at bar is not dissimilar in principle to those cases where persons engaged in interstate transportation are required by the provisions of state statutes to be examined and licensed. Smith v. Alabama, 124 U. S. 465. A presumption should be indulged in that a statute was enacted in good faith. The declared purpose of the act is to be accepted as true unless incompatible with its meaning and effect. Flint v. StoneTracey Co., 220 U: S. 107. It will be contended, that Argument for Appellees.

268 U.S.

the real purpose of the ordinance is to discriminate against non-resident manufacturers in favor of local business. There is nothing in the language to justify such a contention, nor is there any allegation in the bill upon which to base such a claim. It is not alleged or claimed that the ordinance is administered with an unequal hand, so as practically to make discriminations against non-resident manufacturers. See Yick Wo v. Hopkins, 118 U. S. 356. The declared purpose is to prevent the perpetration of fraud upon the citizens of Portland by fraudulent or irresponsible solicitors. It does not discriminate against goods, nor interfere in any way with the free intercourse in goods of a sister state, nor, except in an indirect and incidental manner, with the contract for the sale of such goods. It is aimed solely, at fraudulent practices of such a nature that they are necessarily of a local and not of a national character.

It would seem not only within the power of the State, but its positive duty, to devise some method for reaching the evils of a system so freighted with opportunities for fraudulent practices. The system is enlarging in its scope from year to year. The tendency, today, is to eliminate the middle man entirely. This may be well enough, but the system has built up an immense business in soliciting which is practically the only business of that character which is unregulated and unrestricted. For years individuals, engaged in soliciting for non-resident principals, have successfully hidden behind the provisions of the federal Constitution, and it has prevented legislation designed to reach solicitors of local concerns because of the inequality of such a measure. It is said in Plumley v. Massachusetts, 155 U. S. 461: “ The Constitution of the United States does not secure to anyone the privilege of defrauding the public.” Preventive measures are of infinitely greater benefit to society than an uncertain criminal or civil process, after the damage is done.


Argument for Appellees.

Standard Home Co. v. Davis, 217 Fed. 904; Freund, Police Power, § 272, p. 260; see Crossman v. Lurman, 192 U. S. 189; Savage v. Jones, 225 U. S. 501; Hall v. Geiger-Jones Co., 242 U. S. 539; Merrick v. Halsey & Co., 242 U. S. 568; Caldwell v. Sioux Falls Stock Yards Co., 242 U. S. 559.

We conclude from these cases that, in the absence of national legislation, a state statute, or municipal ordinance, designed to prevent fraudulent practices or fraudulent representations, is a valid exercise of the police power of the State in the interests of the local welfare, notwithstanding that the articles affected are articles of commerce and that interstate commerce is indirectly affected or burdened thereby. The fraud which the ordinance in question seeks to prevent is essentially a local matter and even though the act of soliciting may be an incident of interstate commerce, the indirect burden placed thereon by the ordinance does not contravene the Commerce Clause. The provisions of the ordinance are reasonably adaptable to accomplish the purpose intended—correction of this evil. The requirement of a bond insures the continuance in business of persons of character and responsibility only. The ordinance should be an assistance to commerce rather than a hindrance or burden, by eliminating the dishonest solicitor. The ordinance has to do with conduct not directly connected with any subject of commerce. There is nothing new in the principle that the personnel of business may be regulated on the basis of character and conduct. Gundling v. Chicago, 177 U. S. 183; Bratton v. Chandler, 260 U. S. 110. We have found but one case construing a statute in any degree similar to the ordinance in question. Musco v. United Surety Co., 196 N. Y. 459. This ordinanoe is not distinguishable in principle from the law of Georgia which was the subject of the decision in Western Union Telegraph Co. v. James, 162 U. S. 650.

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The ordinance does not violate the Fourteenth Amendment. Merrick v. Halsey & Co., 242 U. S. 568.

Mr. David Paine filed a brief as amicus curiae, by special leave of Court.

Messrs. James W. Bayard and Ralph B. Evans filed a brief as amici curiae, by special leave of Court.

MR. JUSTICE McREYNOLDS delivered the opinion of the Court.

Appellant is an Illinois corporation engaged in manufacturing silk hosiery at Indianapolis, Ind., and selling it throughout the United States to consumers only. It employs duly accredited representatives in many States who go from house to house soliciting and accepting orders. When a willing purchaser is found the solicitor fills out and signs in duplicate a so-called “order blank.” This obligates appellant to make delivery of the specified goods and, among other things, states

The mills require a deposit of $1.00 (or other specified sum] on each box listed below. Your hosiery will be mailed you by Parcel Post c. o. d., direct from the Post Office branch in our mills. Pay the balance to the post

As the entire business of the Real Silk Hosiery Mills is conducted on the Parcel Post c. o. d. basis, our representatives cannot accept your order unless the deposit is made. We do not accept full payment in advance. Do not pay more than printed deposit.”

One of the copies is left with the purchaser; the other is first sent to the local sales manager and then forwarded to the mills at Indianapolis. In response thereto the goods are packed and shipped by Parcel Post c. o. d. direct to the purchaser. The solicitor retains the cash deposit, and this constitutes his entire compensation.

The appellant employs two thousand representatives who solicit in most of the important cities and towns



Opinion of the Court.

throughout the Union, and has built up a very large business—$10,000,000 per annum. Twenty operate in Portland, Ore.

May 16, 1923, that City passed an ordinance which requires that every person who goes from place to place taking orders for goods for future delivery and receives payment or any deposit of money in advance shall secure a license and file a bond. The license fee is $12.50 quarterly for each person on foot and $25 if he uses a vehicle. The bond must be in the penal sum of $500 and conditioned to make final delivery of ordered goods, &c.

By a bill filed in the United States District Court for Oregon appellant challenged the ordinance and asked that its enforcement be restrained upon the ground, among others; that it interferes with and burdens interstate commerce and is repugnant to Art. I, § 8, Federal Constitution. The trial court upheld the enactment and sustained a motion to dismiss the bill. This was affirmed by the Circuit Court of Appeals. 297 Fed. 897.

Considering former opinions of this court we cannot doubt that the ordinance materially burdens interstate commerce and conflicts with the Commerce Clause. Robbins v. Shelby Taxing District, 120 U. S. 489, 497; Brennan v. Titusville, 153 U. S. 289; Rearick v. Pennsylvania, 203 U. S. 507; Crenshaw v. Arkansas, 227 U.S. 389; Texas Transport Co. v. New Orleans, 264 U. S. 150; Alpha Portland Cement Co. v. Commonwealth of Massachusetts, 268 U. S. 203.

“The negotiation of sales of goods which are in another State, for the purpose of introducing them into the State in which the negotiation is made, is interstate commerce. Manifestly, no license fee could have been required of appellant's solicitors if they had travelled at its expense and received their compensation by direct remittances from it. And we are unable to see that the burden on interstate

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