North Dakota State Board of Pharmacy v. Snyder's Drug Stores, Inc.

Supreme Court of the United States · 1973 · Federal Courts

Federal CourtsFinalityDue Process28 U.S.C. § 1257final judgmentstate-court reviewsubstantive due processeconomic regulation

Facts

North Dakota required that an applicant for a pharmacy permit be either a registered pharmacist or a corporation or association whose majority stock was owned by registered pharmacists in good standing who were actively and regularly employed in and responsible for management, supervision, and operation of the pharmacy. Snyder's Drug Stores, Inc. did not meet that ownership requirement because all of its common stock was owned by Red Owl Stores, and it was not shown whether any Red Owl shareholders were registered pharmacists in good standing in North Dakota. The Board denied the permit without an evidentiary hearing because Snyder's application showed it could not qualify under the ownership requirement. The state supreme court held the statute unconstitutional under Liggett and remanded for consideration of other state-law licensing issues, including structural and safety standards.

Issue

Whether the North Dakota Supreme Court's remand order was a final judgment reviewable under 28 U.S.C. § 1257, and whether North Dakota's requirement that a majority of the stock of a corporation operating a pharmacy be owned by registered pharmacists violates the Due Process Clause of the Fourteenth Amendment.

Rule

A state-court judgment is final under 28 U.S.C. § 1257 when the federal issue is conclusively resolved and delaying review would likely prevent any later review of that issue. Under modern due process doctrine, courts do not invalidate state economic and business regulations as unwise or unnecessary so long as they do not violate a specific federal constitutional prohibition or valid federal law; Liggett v. Baldridge is overruled.

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The Supreme Court of Ohio held that an Ohio statute requiring funeral-home corporations to be majority-owned by licensed funeral directors violates the Fourteenth Amendment. It remanded to the state licensing board to decide only whether Lakefront Memorial Services met unrelated fire-code and recordkeeping requirements, expressly instructing the board not to revisit the constitutional issue.

If the licensing board seeks immediate U.S. Supreme Court review under 28 U.S.C. § 1257, what is the best argument that the state judgment is final?

Explanation. A state-court judgment may be final for § 1257 purposes even though further proceedings remain when the federal issue has been definitively decided and delaying review would likely foreclose later review of that issue. Here, the remand is limited to unrelated state-law matters, and the constitutional question has been removed from further proceedings. If the applicant loses on fire-code or recordkeeping grounds, any later judgment rests on an independent state ground; if the applicant wins, the federal issue disappears from the case. That practical unavailability of later review is what makes the judgment effectively final. (Derived from North Dakota State Board of Pharmacy v. Snyder's Drug Stores, Inc. (1973).)