Ashwander v. Tennessee Valley Auth.
| Ashwander v. Tennessee Valley Authority | |
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| Argued December 19, 1935 Decided February 17, 1936 |
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| Full case name | Ashwander v. Tennessee Valley Authority |
| Citations | 297 U.S. 288 (more) |
| Prior history | Certiorari to the Circuit Court of Appeals for the Fifth Circuit, 78 F.2d 578 |
| Holding | |
| Congress did not abuse its power with the Tennessee Valley Authority, a government corporation established as part of the New Deal to improve the economy of the state. | |
| Court membership | |
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| Case opinions | |
| Plurality | Hughes |
| Concurrence | Brandeis, joined by Cardozo, Roberts, Stone |
| Concur/dissent | McReynolds |
Ashwander v. Tennessee Valley Authority, 297 U.S. 288 (1936), was a United States Supreme Court case that provided the first elaboration of the doctrine of "Constitutional avoidance".
In Ashwander, the Supreme Court faced a challenge to the constitutionality of a congressional program of development of the Wilson Dam. The plaintiffs, of the Alabama Power Company, had unsuccessfully protested to the corporation about its contracts with the Tennessee Valley Authority ("TVA"). Plaintiffs then brought suit against the corporation, the TVA, and others alleging breach of contract and advancing a broad constitutional challenge to the governmental program. In December 1934, Federal Judge William Irwin Grubb held that the government had no right to engage in the power business except to dispose of a surplus incidental to the exercise of some other Constitutional function. While he did not directly rule that the TVA was unconstitutional, he issued an injunction that caused Senator George Norris, prime sponsor of the New Deal's power program, to declare: "The effect of the injunction is practically to nullify the whole TVA Act." In July 1935, the injunction was overturned by the 5th Federal Circuit Court in New Orleans. When the matter reached the Supreme Court, the plurality did not reach the broadest constitutional questions presented by plaintiffs, but instead upheld Congress's constitutional authority to dispose of electric energy generated at the dam and validated the contracts.
At the outset, the plurality rejected the government's argument that the preferred stockholders did not have standing to bring the suit because the government program was directly competing with a private company. The plurality then considered the scope of the constitutional issue presented. The plurality found the scope "limited to the validity of the contract" between the parties, rather than extending to the broad challenge to the validity of the entire TVA program. Although the plurality refused to issue an advisory opinion on plaintiffs' broader hypothetical and contingent constitutional claims, it did review the constitutionality of the legislation insofar as the plaintiffs had presented facts of a legitimate "case or controversy."
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