Commerce has always been one of the most debated topics before the Supreme Court. Although it seems clearly defined in Article 1, Section 8 of the Constitution, the authority of regulating commerce is continually challenged. The stream of commerce doctrine, the opinion in United States v. E.C. Knight Company (1895), and the opinion in Stafford v. Wallace (1922) are examples of how the court has tried to rectify the arguments over commerce, but to no avail.
The stream of commerce doctrine stems from Justice Holmes" opinion in the Swift and Company v. United States (1905) case. In this case, Swift and Company argued that stockyards were not a part of interstate commerce, but rather a matter to be regulated solely by the states. However, the Supreme Court ruled unanimously that the sale of meat started at the very first transaction when the cattle left the range and didn't end until it reached its final destination. This meant that the stockyard was part of the stream of the sale, therefore regulated by the federal government and was subject to the regulations in the Sherman Antitrust Act.
Ten years before the stream of commerce doctrine, the Supreme Court decided the case of United States v. E.C. Knight Company (1895) that helped define the direct and indirect effects doctrine. In this case, the American Sugar Refining Company wanted to purchase the E.C. Knight Company. However, the purchase of this sugar refinery would give American Sugar control over 98% of the sugar refineries. The federal government sued under the Sherman Antitrust Act, but was not successful in stopping the sale. In the opinion of the court, Justice Fuller wrote that "there was nothing in the proofs to indicate any intention to put a restraint upon trade or commerce" and therefore America Sugar had not violated the Sherman Antitrust Act. The court decided that the monopoly that American Sugar acquired only had an indirect effect, opposed to a direct effect, on interstate commerce and so was not under federal regulation.
