Allgeyer v. Louisiana
163 U.S. 578 (1897)
- Louisiana had a Statute (Article 236) that said that foreign (or out-of-state) corporations couldn’t do business in Louisiana without having a known place of business within the State for service of process.
- Louisiana said they had the authority to enact this law based on their police powers.
- Allgeyer bought insurance from a New York insurer (Atlantic Mutual), thereby violating the law. When Louisiana levied a fine, Allgeyer sued, saying that Article 236 was an unconstitutional violation of the 14th Amendment’s Due Process Clause.
- Allgeyer argued that they should be granted the economic freedom to enter into contracts with anyone they chose to. (aka economic liberty)
- The US Supreme Court found for Allgeyer.
- The US Supreme Court found that Louisiana violated Allegeyer’s economic liberty.
- The Court noted that Allgeyer had entered into the contract with the insurer in New York to insure their Louisiana property. Atlantic Mutual was not bound in anyway by Louisiana law, so Article 236 impermissibly interfered with Atlantic Mutual’s right to contract.
- Which in turn interfered with Allgeyer’s right to contract.