December 31, 2004

Memorial Concepts Online sells an oak coffin for about $2,000, compared to an average of around $4,000 at funeral homes in Oklahoma, where the company is based. By separating the purchase of caskets from the purchase of funeral services, Memorial Concepts can offer substantial savings, not to mention a shopping environment free of hovering morticians. But in Oklahoma, which allows caskets to be sold only by licensed funeral directors, such competition is illegal.

Kim Powers and Dennis Bridges, the founders of Memorial Concepts, are fighting to overturn Oklahoma's casket cartel, arguing that it violates their rights to due process, equal protection, and economic liberty under the 14th Amendment. Last August the U.S. Court of Appeals for the 10th Circuit rejected their arguments in a decision Powers and Bridges have asked the Supreme Court to review.

Since the 10th Circuit's ruling conflicts with a 2002 decision by the U.S. Court of Appeals for the 6th Circuit that overturned similar restrictions on casket sales in Tennessee, there's a good chance the Supreme Court will intervene. If it does, the case could help re-establish the principle that people have a right to pursue a livelihood without arbitrary interference by the government.

The 10th Circuit did not pretend Oklahoma's rules for selling caskets make sense. "As a result of the substantial mis-fit between the education and training required for licensure and the education and training required to sell caskets in Oklahoma," it noted, "people who only wish to sell caskets...are required to spend years of their lives equipping themselves with knowledge and training which is not directly relevant to selling caskets."

Qualifying as a funeral director in Oklahoma requires two years of college courses, graduation from a mortuary science program, a one-year apprenticeship that includes the embalming of at least 25 bodies, and two exams. After all that, the applicant is deemed qualified to sell boxes.

The state also mandates that caskets be sold from a "funeral establishment" that includes a "preparation room" for embalming, a "selection room" for displaying casket options, and "adequate areas for public viewing of dead human remains." These requirements leave no room for an online business such as Memorial Concepts that sells caskets directly to the public and never handles bodies.

As the 10th Circuit noted, the Oklahoma State Board of Embalmers and Funeral Directors "concedes that its licensure requirements do not perfectly match its asserted consumer-protection goal." Rather than accepting the idea that fewer choices and higher prices are good for consumers, the court ruled that even if the whole point of the regulations was to protect funeral homes from competition, that would be OK.

To survive a challenge under the 14th Amendment's Due Process and Equal Protection clauses, a regulation has to be "rationally related to a legitimate government purpose." But if, as the 10th Circuit ruled, "intrastate economic protectionism constitutes a legitimate state interest," there's little doubt that Oklahoma's restrictions on casket sales satisfy this test.

"While baseball may be the national pastime of the citizenry," the court wrote, "dishing out special economic benefits to certain in-state industries remains the favored pastime of state and local governments." Such protectionism may be unfair and inefficient, the court said, but that doesn't make it unconstitutional.

The upshot of this argument is that almost anything goes when it comes to rigging the game in favor of special interests. "The 10th Circuit gave a judicial green light to unlimited backroom deals and cronyism by legislators," says Chip Mellor, president of the Institute for Justice, which represents Powers and Bridges.

If it hears Powers and Bridges' appeal, the Supreme Court will have an opportunity to explicitly reject the idea that protecting certain businesses from competition represents a "legitimate state interest." More important, it will have an opportunity to revisit the part of the 14th Amendment that says "no State shall make or enforce any law which shall abridge the privileges or immunities of citizens of the United States."

Those "privileges or immunities" originally were understood to include the ability to make an honest living free of official harassment, which is all that Powers and Bridges want to do. But in an 1873 decision upholding a slaughterhouse monopoly granted by Louisiana, the Supreme Court essentially read the Privileges or Immunities Clause out of the Constitution. Now it has a chance to correct that error and restore to Americans some of their lost liberty.

Jacob Sullum is a senior editor at Reason and the author of Saying Yes: In Defense of Drug Use (Tarcher/Putnam).

© Copyright 2004 by Creators Syndicate Inc.