Osborn v. Bank of the United States

9 Wheat. (22 U.S.) 738 (1824), argued 10–11 March 1824, decided 19 March 1824 by vote of 6 to 1; Marshall for the Court, Johnson in dissent. Originating in a challenge to the constitutionality of the Bank of the United States, Osborn produced an elaborate statement by Chief Justice John Marshall concerning the jurisdiction of federal courts. In 1819 Ohio imposed a prohibitive tax on branches of the Bank of the United States. Defying a federal injunction against its collection (see Injunctions and Equitable Remedies), Ralph Osborn, the state auditor, ordered his agents to seize the money and deposit it in the state treasury. The bank sued Osborn in federal circuit court for return of the money and prevailed. On appeal by Osborn, the Supreme Court affirmed the judgment; its decision in McCulloch v. Maryland (1819) had upheld the constitutionality of the bank and inhibited the states' power to tax federal instrumentalities.

At issue in Osborn was an unconstitutional state tax levied on a federal corporation. The Constitution extends federal judicial power to all cases “arising under” the Constitution, laws, and treaties of the United States. Marshall, however, used the case to proclaim federal jurisdiction over every case involving the bank, even those seemingly raising only questions of state law. Basing federal jurisdiction on the bare possibility of federal question, Marshall generously construed congressional power to confer jurisdiction, a proposition that Justice William Johnson, writing in dissent, thought risked federalizing too many questions. A further jurisdictional issue concerned the Eleventh Amendment, which restricted suits against states. Although Osborn was acting on behalf of his state, the Court held that he could not assert its immunity from suit, a proposition later reaffirmed in Ex parte Young (1908).

See also Federal Questions; Judicial Power and Jurisdiction; Lower Federal Courts; State Sovereignty and States' Rights.

— John V. Orth

Osborn v. Bank of the United States, (9 Wheaton 738 [1824]), a Supreme Court decision upholding a circuit court ruling against the taxing by a state of branches of the second Bank of the United States. In February 1819, the Ohio legislature levied a tax of $50,000 on each state branch of the second bank. Chief Justice John Marshall's opinion, following the precedent of McCulloch v. Maryland (1819), held the Ohio law unconstitutional. Despite passing a law withdrawing the protection of state laws from the Bank of the United States, the Ohio legislature made no attempt to nullify the Supreme Court decision.

Bibliography

White, G. Edward. The Marshall Court and Cultural Change, 1815–1835. New York: Macmillan, 1988.

Osborn v. Bank of the United States
Supreme Court of the United States
Argued March 10, 1824 Decided March 19, 1824
Full case name	Ralph Osborn and others, Appellants v. The President, Directors, and Company of the Bank of the United States, Respondents
Citations	22 U.S. 738 (more) 22 U.S. (9 Wheat.) 738; 6 L. Ed. 204; 1824 U.S. LEXIS 409
Prior history	Appeal from the Circuit Court of Ohio
Holding
Eleventh Amendment is inapplicable in suits in which a state is not a party of record, even when a party is acting as a state official[1]
Court membership
Chief Justice John Marshall Associate Justices Bushrod Washington · William Johnson Thomas Todd · Gabriel Duvall Joseph Story · Smith Thompson
Case opinions
Majority	Marshall, joined by Washington, Todd, Duvall, Story, Thompson
Dissent	Johnson
Laws applied
U.S. Const. amend. XI

Osborn v. Bank of the United States, 22 U.S. 738 (1824), was case set in the Banking Crisis of 1819, during which many banks, including the Bank of the United States, demanded repayment for loans which they had issued on credit that they did not have. This led to an economic downturn and a shortage of money. In 1819, Ohio passed a law which put a tax on the Bank of the United States, the theory being that if a bank were taxed it would allow the state government to receive and distribute the scarce money. On September 17, 1819, Ohio Auditor Ralph Osborn was given permission to seize $100,000 from a branch of the Bank of the United States. However, his agents mistakenly took $120,000, the extra $20,000 of which he promptly returned. The bank chose to sue Osborn for the return of the additional $100,000, and a federal court ruled that Osborn violated a court order prohibiting the taxing of the bank. Osborn argued that he had never been properly served with this order, but still had to return the money. A problem arose when Osborn could only pay back $98,000, as the other $2,000 had been used to pay the salary of Osborn's tax agents. In 1824, the Supreme Court of the United States ruled in favor of the Bank of the United States, ordering the return of the disputed $2,000.

See also

• List of United States Supreme Court cases, volume 22

External links

• Osborn v. Bank of the United States, 22 U.S. 738 (1824) (opinion full text).

Notes

1. ^ Richard H. Fallon, Jr., et al., Hart and Wechsler's The Federal Courts and the Federal System (Foundation Press, Fifth Edition, 2003), Pg 992.

This article related to the Supreme Court of the United States is a stub. You can help Wikipedia by expanding it. v • d • e

This entry is from Wikipedia, the leading user-contributed encyclopedia. It may not have been reviewed by professional editors (see full disclaimer)