Can Congress delegate broad legislative powers to the President to regulate intrastate commerce under the guise of economic recovery?

A.L.A. Schechter Poultry Corporation and Schechter Live Poultry Market operated wholesale poultry slaughterhouses in Brooklyn, New York. They purchased live poultry from out-of-state sources, slaughtered it, and sold it to local retailers. The companies were convicted of violating the 'Live Poultry Code,' which was established under the National Industrial Recovery Act. This code regulated various aspects of the poultry industry, including employee hours and wages, as well as sales practices.

The specific violations charged against the Schechters included infractions related to employee wages and hours. Additionally, they were accused of violating the code's provision on 'straight killing,' a practice where entire coops of chickens were sold rather than allowing customers to select individual birds. These violations formed the basis of the legal case against the Schechter companies.

The government charged the defendants with multiple counts of violating the Live Poultry Code and conspiracy in the U.S. District Court for the Eastern District of New York. The District Court convicted the defendants on all 19 counts. The defendants appealed to the Circuit Court of Appeals, which affirmed the convictions on 16 code violation counts and the conspiracy count, but reversed on two counts related to minimum wages and maximum hours. Following this decision, both the defendants and the government sought review by the Supreme Court through writs of certiorari, which the Court granted.

(Hughes, C.J.)

No. Congress cannot delegate broad legislative powers to the President to regulate intrastate commerce under the guise of economic recovery. The National Industrial Recovery Act unconstitutionally delegated legislative power to the President by providing no clear standards or limitations on the authority to approve or prescribe codes of fair competition. Such broad delegation violates the separation of powers doctrine, which requires Congress to set clear guidelines and boundaries when granting regulatory authority to the executive branch. Furthermore, the Act exceeded Congress's power under the Commerce Clause by attempting to control intrastate transactions that only indirectly affected interstate commerce. The Constitution grants Congress the power to regulate interstate commerce, but this power does not extend to purely local activities with merely indirect effects on interstate trade. A clear distinction exists between direct and indirect effects on interstate commerce, and federal regulatory power under the Commerce Clause is limited to activities with a direct impact. Local activities such as poultry slaughtering and sales, which have only an indirect effect on interstate commerce, fall outside the scope of federal regulatory authority. This interpretation preserves the balance of power between federal and state governments, ensuring that Congress does not encroach upon areas traditionally regulated by the states under the guise of economic regulation.

Concurrence (Cardozo, J.) The delegated power of legislation in the code was unconfined and vagrant, amounting to a 'roving commission' that is unconstitutional. The regulation of wages and hours in intrastate transactions exceeds the federal government's power under the Commerce Clause. This decision reinforces the importance of maintaining clear boundaries between legislative and executive powers, and limits the reach of federal authority in regulating intrastate commerce.

Concurrence (Stone, J.) Concurred with the majority opinion without providing a separate written opinion.