Grosjean v. American Press Co., Inc., 297 U.S. 233, February 10, 1936

SUTHERLAND, J.:

I.      THE FACTS

The case of Grosjean v. American Press Co., Inc., 297 U.S. 233, February 10, 1936, involved a Louisiana law that imposed on publishing companies a license tax of 2% of the gross receipts for the privilege of engaging in advertising in newspapers, magazines or periodicals if their circulation is more than 20,000 copies per week. Nine Louisiana-based publishers of newspapers, with circulations of more than 20,000 copies per week each, filed a suit to enjoin the enforcement against them of the said provision. They assailed the validity of the act on the ground, inter alia, that it abridges the freedom of the press in contravention of the due process clause contained in the Fourteenth Amendment of the U.S. Constitution.

II.    THE ISSUE

Did the assailed Louisiana law abridge the freedom of the press in contravention of the due process clause contained in the Fourteenth Amendment?

III.   THE RULING

[The Court voted unanimously to AFFIRM the decree of the District Court for the Eastern District of Louisiana permanently enjoining the enforcement of the Louisiana state tax on newspapers.]

A unanimous U.S. Supreme Court held that “the act imposing the tax in question is unconstitutional under the due process of law clause because it abridges the freedom of the press,” thus:

The tax imposed is designated a “license tax for the privilege of engaging in such business” -- that is to say, the business of selling, or making any charge for, advertising. As applied to appellees, it is a tax of two percent on the gross receipts derived from advertisements carried in their newspapers when, and only when, the newspapers of each enjoy a circulation of more than 20,000 copies per week. It thus operates as a restraint in a double sense. First, its effect is to curtail the amount of revenue realized from advertising, and, second, its direct tendency is to restrict circulation. This is plain enough when we consider that, if it were increased to a high degree, as it could be if valid, it well might result in destroying both advertising and circulation. (Citation omitted.)

           

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xxx. The tax here involved is bad not because it takes money from the pockets of the appellees. If that were all, a wholly different question would be presented. It is bad because, in the light of its history and of its present setting, it is seen to be a deliberate and calculated device in the guise of a tax to limit the circulation of information to which the public is entitled in virtue of the constitutional guaranties. A free press stands as one of the great interpreters between the government and the people. To allow it to be fettered is to fetter ourselves.