at different banks in the United States to be applied by the agents representing the lottery company to the prompt payment of prizes. These tickets were the subject of traffic; they could have been sold; and the holder was assured that the company would pay to him the amount of the prize drawn. That the holder might not have been able to enforce his claim in the courts of any country making the drawing of lotteries illegal, and forbidding the circulation of lottery tickets, did not change the fact that the tickets issued by the foreign company represented so much money payable to the person holding them and who might draw the prizes affixed to them. Even if a holder. did not draw a prize, the tickets, before the drawing, had a money value in the market among those who chose to sell or buy lottery tickets. In short, a lottery ticket is a subject of traffic, and is so designated in the act of 1895. (28 Stat. at L. 933, U. S. Comp. Stat. 1901, p. 3179.) That fact is not without significance in view of what the court has said. That act, counsel for the accused well remarks, was intended to supplement the provisions of prior acts, excluding lottery tickets from the mails, and prohibiting the importation of lottery matter from abroad, and to prohibit the act of causing lottery tickets to be carried, and lottery advertisements to be transferred from one State to another by any means or method.' We are of opinion that lottery tickets are subjects of traffic, and therefore are subjects of commerce, and the regulation of the carriage of such tickets from State to State, at least by independent carriers, is a regulation of commerce among the several States."21

§ 296. Bearing of the Lottery Decision on Insurance.

6

The holding by the court that lottery tickets are articles of commerce and may become articles of interstate commerce, has

21 In the minority opinion it is urged that the same reasoning which had been applied to hold bills of exchange and policies of insurance not to be articles of commerce was applicable to lottery tickets. "The lottery tickets," says Chief Justice Fuller, speaking for the minority, "purports to create

undoubtedly increased the possibility that, should a federal law be enacted in regulation of insurance companies doing business in more than one State, it will be sustained by the Supreme Court. Certainly there are very great points of similarity between a policy of insurance and a lottery ticket. Like the insurance policy, the lottery ticket is a promise to pay upon the happening of a certain contingency. Lottery tickets, to be sure, do indeed freely pass from hand to hand by sale or exchange, but, though not so readily, insurance policies are also at times sold and exchanged. Furthermore, as has been already observed, should the constitutionality of a federal law in regulation of insurance be involved, it would receive the benefit of every rational doubt.

§ 297. Commerce Does not Include the Production of the Commodities Transported.

In a series of most important decisions it has been held that commerce does not begin until the goods intended for purchase, sale, or exchange in another State have begun their trip thither. That is to say, they must at least have been placed in the hands

contractual relations, and to furnish the means of enforcing a contract right. This is true of insurance policies, and both are contingent in nature. . If a lottery ticket is not an article of commerce, how can it become so when placed in an envelope or box or other covering, and transported by an express company? To say that the mere carrying of an article which is not an article of commerce in and of itself nevertheless becomes such the moment it is to be transported from one State to another, is to transform a noncommercial article into a commercial one simply because it is transported. I cannot conceive that any such result can properly follow. It would be to say that everything is an article of commerce the moment it is taken to be transported from place to place, and of interstate commerce if from State to State. An invitation to dine, or to take a drive, or a note of introduction, all become articles of commerce under the ruling in this case, by being deposited with an express company for transportation. This in effect breaks down all the difference between that which is, and that which is not, an article of commerce, and the necessary consequence is to take from the States all jurisdiction over the subject so far as interstate communication is concerned. It is a long step in the direction of wiping out all traces of state lines, and the creation of a centralized government."

of the agents who are to transport them. The mere fact that goods are manufactured to be transported and sold in another or other States, or that they have been segregated in the place where produced, for that purpose, is not sufficient to make them. articles of interstate commerce. In some way they must have advanced some distance upon their way outside of the State of production. It is clear, therefore, that the whole process of manufacture or production is definitely excluded from the operation of the commerce clause. "Commerce succeeds to manufacture,

and is not a part of it." 22

This subject will receive especial treatment in Chapter XLIII in which will be considered the extent of the legislative powers of the Federal Government under the commerce clause and, especially, the discussion arising under the Anti-Trust Act of 1890.

§ 298. Intent to Export not Controlling.

The fact that goods are manufactured for export does not render their manufacture an element in the interstate or foreign commercial transaction.

22 U. S. v. E. C. Knight Co., 156 U. S. 1; 15 Sup. Ct. Rep. 249; 39 L. ed. 325. In Kidd v. Pearson (128 U. S. 1; 9 Sup. Ct. Rep. 6; 32 L. ed. 346) the court say: "No distinction is more popular to the common mind, or more clearly expressed in economic and political literature, than that between manufacture and commerce. Manufacture is transformation - the fashioning of raw materials into a change of form for use. The functions of commerce are different. The buying and selling and the transportation incidental thereto constitute commerce; and the regulation of commerce in the constitutional sense embraces the regulation at least of such transportation. If it be held that the term includes the regulation of all such manufactures as are intended to be the subject of commercial transactions in the future, it is impossible to deny that it would also include all productive industries that contemplate the same thing. The result would be that Congress would be invested, to the exclusion of the States, with the power to regulate not only manufactures but also agriculture, horticulture, stock raising, domestic fisheries, mining-in short, every branch of human industry. For is there one of them that does not contemplate, more or less clearly, an interstate or foreign market? Does not the wheat grower of the Northwest or the cotton planter of the South, plant, cultivate and harvest his crop with an eye on the prices at Liverpool, New York and Chicago? The power being vested in Congress and denied to the States, it would follow as an inevitable

This principle is clearly laid down in Coe v. Errol.23 In this case the court held that certain logs cut in New Hampshire and hauled to a river town for transportation to the State of Maine, but not yet actually started upon their final way to that State, had not become articles of interstate commerce. The court say:

"Does the owner's state of mind in relation to the goods, that is, his intent to export them, and his partial preparation to do so, exempt them [as articles of interstate commerce] from taxation? . . . There must be a point of time when they ceased to be governed exclusively by the domestic law and begin to be governed and protected by the national law of commercial regulation, and that moment seems to us to be a legitimate one for this purpose, in which they commence their final movement from the State of their origin, to that of their destination."

§ 299. Interstate Commerce Includes the Sale of the Articles Imported.

It has been seen that interstate commerce does not begin until, by some definite act, the goods have started upon their trip outside the State of origin. As to the termination of interstate transportation it has been established that this does not occur until the goods transported have reached their destination, been delivered, and, either sold or taken out of their original packages in which shipped, and thus commingled with the other goods of the State.

The right to import including the right of the importer to sell the goods imported, and the right to engage in interstate and foreign commerce being a federal right, the States have no more constitutional power to restrain or regulate the sale of imported commodities by the importer than they have to prevent or regulate their being brought within the State.

This principle was first clearly declared by Marshall in Brown v. Maryland.24 "Sale," declared the Chief Justice, "is the

result that the duty would devolve on Congress to regulate all of these delicate, multiform and vital interests interests which in their nature are and must be local in all the details of their successful management." 23 116 U. S. 517; 6 Sup. Ct. Rep. 475; 29 L. ed. 715.

24 12 Wh. 419; 6 L. ed. 678.

.

object of importation, and is an essential ingredient of that intercourse of which importation constitutes a part. Congress has a right not only to authorize importation, but to authorize the importer to sell."

The case of Brown v. Maryland had to deal with foreign commerce and it seemed for a number of years that its application would be limited to that commerce. Indeed, that this was so was intimated as late as 1886 in Robbins v. Taxing District.25 But in Bowman v. Northwestern Railroad,26 decided in 1887, the reasoning indicated that the doctrine would be applied to interstate commerce, and in Leisy v. Hardin,27 decided in 1890, this was squarely declared and has since been repeatedly affirmed.

The fact that the right to engage in commerce carries with it the right to sell the goods transported, does not, it has been held, exclude the right of the State to tax goods brought from another State still unsold, and still in their original packages, provided such goods be not discriminated against because of their having been brought into the State from another State. As to imports from foreign countries, however, the rule is that until sale in the original package, or until the breaking of the package, no state tax may be imposed. This prohibition is, however, not drawn from the commerce clause but from the express provision of the Constitution that "No State shall, without the consent of Congress, lay any impost or duty on imports or exports (Art. I, Sec. X)."

This branch of the subject will be more fully discussed elsewhere in this treatise.

§ 300. The Original Package Doctrine.

From the foregoing sections it has appeared that the State's authority over articles brought in from the other States does not attach, except for purposes of taxation, until the articles so brought in have been sold. It will also have appeared, however, from the quotations which have been made, that this rule is 25 120 U. S. 489; 7 Sup. Ct. Rep. 592; 30 L. ed. 694. 26 125 U. S. 465; 8 Sup. Ct. Rep. 689; 31 L. ed. 700. 27 135 U. S. 100; 10 Sup. Ct. Rep. 681; 34 L. ed. 128.