Under the commerce clause, Congress has power to deal with acts
not in themselves interstate commerce, but which obstruct or
otherwise injuriously affect it. P. 250 U. S.
Bills of lading in interstate commerce are instrumentalities of
that commerce, subject to the authority of Congress under the
commerce clause. P. 250 U. S.
Judicial notice will be taken of the importance of bills of
lading in interstate commerce. Id.
Congress has power to prohibit and punish the forgery and
utterance of bills of lading for fictitious shipments in interstate
commerce as a means of protecting and sustaining that commerce. P.
250 U. S.
256 F. 388 reversed.
The case is stated in the opinion.
Page 250 U. S. 200
MR. CHIEF JUSTICE WHITE delivered the opinion of the Court.
The twenty-four counts of the indictment in this case were
concerned with the commission of acts defined as criminal and
punished by the forty-first section of the Act of August 29, 1916,
entitled, "An act relating to bills of lading in interstate and
foreign commerce." 39 Stat. 538.
In the first count, it was charged that the accused, in
violation of the section, on or about the 14th day of August, 1917,
in Cincinnati, Ohio,
"did . . . feloniously, and with intent to defraud, falsely
make, forge, and counterfeit, and aid and assist in feloniously
making, forging, and counterfeiting a certain bill of lading
purporting to represent goods received at Fountaintown, in the
State of Indiana, for shipment to Cincinnati, in the State of Ohio,
and to utter and publish and aid and assist in uttering and
publishing such falsely made, forged, and counterfeited bill of
lading, then and there knowing the same to be falsely made, forged,
and counterfeited. . . ."
A copy of the fabricated bill of lading was reproduced in the
count. It was negotiable in form, following the standard approved
by the Interstate Commerce Commission (Order No. 787, June 27,
1908). The bill acknowledged the receipt by the Cincinnati,
Hamilton & Dayton Railway Company of corn in bulk at a
designated place in Indiana, shipped to Cincinnati to the order of
the shipper, and with directions to notify a person named. It
contained all the
Page 250 U. S. 201
earmarks which would have been found in a genuine bill of
The second count charged the knowing, willful, and felonious
uttering of the bill of lading, and, with criminal intent and
knowledge, obtaining money on it from the Second National Bank of
Cincinnati by using it as collateral.
These first two counts are types of the remaining twenty-two,
except that the latter dealt with eleven other bills of lading, as
to each of which there were two counts, charging in the exact words
used in the first and second counts, on the one hand the felonious
fabricating and uttering of a bill of lading, and on the other hand
the uttering and obtaining on the same bill of money from the
Second National Bank of Cincinnati.
There was a motion to quash all the counts based upon alleged
defects in pleading with which we are not concerned, and, by
demurrer, the failure of the indictment to charge an offense was
asserted on these grounds:
"First. That said Act of Congress . . . approved August 29,
1916, is unconstitutional and void, especially § 41 of said act
insofar as it attempts to make it a crime and punish any person who
forges or counterfeits a bill of lading where no shipment from one
state to another is made or intended."
"Second. That said act can only apply to bills of lading
representing actual shipments of merchandise or commerce between
the states. If it is intended to apply to wholly fictitious
shipments, it is unconstitutional and void so far as said
fictitious shipments are concerned, because the power of Congress
to legislate upon this subject matter is based wholly and solely
upon the commercial clause of the Constitution, and if there is no
commerce, there is no jurisdiction."
The demurrer was sustained, and all the counts in the indictment
were dismissed. The court said:
Page 250 U. S. 202
"It was agreed in the argument and assumed in the briefs of
counsel that the so-called bills of lading were fictitious in that
there was no actual consignor or consignee and that they did not
relate to any shipment or attempted shipment of corn whatsoever.
This fact so agreed upon in open court is to be read into the
Dealing with the case thus made, the court observed:
"These bogus bills of lading were nothing but pieces of paper,
fraudulently inscribed to represent a real contract between real
people and the actual receipt of goods for interstate shipment. . .
. That they were inscribed so as to purport to relate to interstate
shipments was nothing else than a fraud upon such persons as
innocently took them, as collateral or otherwise. The execution of
them and their use for obtaining money under false pretenses was
nothing other than a crime of a kind cognizable by the criminal
legislation of the states, and a matter with which the Congress, in
the exercise of its power to regulate commerce, is not
And, upon these premises, after reviewing what were deemed to be
the controlling authorities, it was concluded that the case
"must be decided in favor of the defendants, and the holding
made that the Congress has not the power, under the commerce
clause, to prescribe a punishment under the circumstances of this
case, and if the Congress has sought to do so, the attempt is
futile, because without authority."
Despite the hypothetical form in which this conclusion is
expressed, the context of the opinion makes it certain that,
reading the facts charged in the indictment in the light of the
admissions made at the argument, the court construed the section of
the statute as embracing such acts and decided that, as thus
construed, it was void for repugnancy to the Constitution.
At the outset, confusion in considering the issue may result
unless obscurity begotten by the form in which the
Page 250 U. S. 203
contention is stated be dispelled. Thus, both in the pleadings
and in the contention as summarized by the court below, it is
insisted that, as there was and could be no commerce in a
fraudulent and fictitious bill of lading, therefore the power of
Congress to regulate commerce could not embrace such pretended
bill. But this mistakenly assumes that the power of Congress is to
be necessarily tested by the intrinsic existence of commerce in the
particular subject dealt with, instead of by the relation of that
subject to commerce and its effect upon it. We say mistakenly
assumes because we think it clear that, if the proposition were
sustained, it would destroy the power of Congress to regulate, as
obviously that power, if it is to exist, must include the authority
to deal with obstructions to interstate commerce (In re
Debs, 158 U. S. 564
with a host of other acts which, because of their relation to and
influence upon interstate commerce, come within the power of
Congress to regulate although they are not interstate commerce in
and of themselves. It would be superfluous to refer to the
authorities which from the foundation of the government have
measured the exertion by Congress of its power to regulate commerce
by the principle just stated, since the doctrine is elementary, and
is but an expression of the text of the Constitution. Art. I, § 8,
cl. 18. A case dealing with a somewhat different exercise of power,
but affording a good illustration of the application of the
principle to the subject in hand, is First National Bank v.
Union Trust Co., 244 U. S. 416
Although some of the forms of expression used in the opinion
below might serve to indicate that the error just referred to had
found lodgment in the mind of the court, the context of the opinion
makes it certain that such was not the case, since the court left
no obscurity in its statement of the issue which it decided,
"They [the fictitious bills of lading] did not affect commerce
directly or indirectly. They did not obstruct or interfere
Page 250 U. S. 204
with it in any manner, and had nothing whatever to do with it or
with any existing instrumentality of it."
This statement not only clearly and accurately shows the
question decided, but also with precision and directness points out
the single and simple question which we must consider and dispose
of in order to determine whether the court below erred in holding
that the authority of Congress to regulate commerce did not embrace
the power to forbid and punish the fraudulent fabrication and use
of fictitious interstate bills of lading.
That bills of lading for the movement of interstate commerce are
instrumentalities of that commerce which Congress under its power
to regulate commerce has the authority to deal with and provide for
is too clear for anything but statement, as manifested not only by
that which is concluded by prior decisions, but also by the
exertion of the power by Congress. Nothing could better illustrate
this latter view than do the general provisions of the act, the
forty-first section of which is before us. See also
June 29, 1906, c. 3591, § 7, 34 Stat. 584, 593; Act of June 18,
1910, 36 Stat. 546, c. 309, § 7; Almy v.
24 How. 169; Thames & Mersey
Marine Ins. Co. v. United States, 237 U. S.
, 237 U. S. 26
Atchison, Topeka & Santa Fe Ry. Co. v. Harold,
241 U. S. 371
241 U. S. 378
Luckenbach v. McCahan Sugar Refining Co., 248 U.
; Missouri, Kansas & Texas Ry. Co. v.
Sealy, 248 U. S. 363
That, as instrumentalities of interstate commerce, bills of lading
are the efficient means of credit resorted to for the purpose of
securing and fructifying the flow of a vast volume of interstate
commerce upon which the commercial intercourse of the country, both
domestic and foreign, largely depends, is a matter of common
knowledge as to the course of business of which we may take
judicial notice. Indeed, that such bills of lading and the faith
and credit given to their genuineness and the value they represent
are the producing and sustaining causes of the enormous number
Page 250 U. S. 205
of transactions in domestic and foreign exchange is also so
certain and well known that we may notice it without proof.
With this situation in mind, the question therefore is: was the
court below right in holding that Congress had no power to prohibit
and punish the fraudulent making of spurious interstate bills of
lading as a means of protecting and sustaining the vast volume of
interstate commerce operating and moving in reliance upon genuine
bills? To state the question is to manifest the error which the
court committed, unless that view is overcome by the reasoning by
which the conclusion below was sought to be sustained. What was
that reasoning? That the bills were but
"pieces of paper fraudulently inscribed . . . , and did not
affect commerce directly or indirectly . . . and had nothing
whatever to do with it or any existing instrumentality of it."
But this rests upon the unsustainable assumption that the
undoubted power which existed to regulate the instrumentality, the
genuine bill, did not give any power to prevent the fraudulent and
spurious imitation. It proceeds further, as we have already shown,
upon the erroneous theory that the credit and confidence which
sustains interstate commerce would not be impaired or weakened by
the unrestrained right to fabricate and circulate spurious bills of
lading apparently concerning such commerce. Nor is the situation
helped by saying that, as the manufacture and use of the spurious
interstate commerce bills of lading were local, therefore the power
to deal with them was exclusively local, since the proposition
disregards the fact that the spurious bills were in the form of
interstate commerce bills which, in and of themselves, involved the
potentiality of fraud as far-reaching and all-embracing as the flow
of the channels of interstate commerce in which it was contemplated
the fraudulent bills would circulate. As the power to regulate the
instrumentality was coextensive with interstate commerce,
Page 250 U. S. 206
so it must be, if the authority to regulate is not to be denied,
that the right to exert such authority for the purpose of guarding
against the injury which would result from the making and use of
spurious imitations of the instrumentality must be equally
We fail to understand the danger to the powers of government of
the several states which it is suggested must arise from sustaining
the validity of the provisions of the act of Congress in question.
On the contrary, we are of opinion that to deny the power asserted
would be to depart from the text of the Constitution and to
overthrow principles of interpretation which, as we have seen, have
been settled since McCulloch v.
4 Wheat. 316, and which in application
have never been deviated from.
This conclusion remains unshaken despite an examination of the
decided cases cited by the court below in its opinion or which were
pressed upon our attention in argument, since, in our judgment,
they all but express the general principles of interpretation which
we have applied and which are decisive against the contention of
want of power in Congress which was upheld below and is here
It follows that the judgment below was wrong. It must therefore
be reversed, and the case be remanded for further proceedings in
conformity with this opinion.
And it is so ordered.
MR. JUSTICE PITNEY dissents.