In his majority opinion for the Court, Associate Justice Harlan F. Stone wrote that economic regulations were "presumptively constitutional" under a deferential standard of review known as the "rational basis test".
The case is most notable for Footnote Four, in which Stone wrote that the Court would exercise a stricter standard of review when a law appears on its face to violate a provision of the United States Constitution, restricts the political process in a way that could impede the repeal of an undesirable law, or discriminates against "discrete and insular" minorities.
Footnote Four would influence later Supreme Court decisions, and the higher standard of review is now known as "strict scrutiny".
The defendant, a company that traded in a form of filled milk consisting of condensed skim milk and coconut oil (which the company labeled "Milnot" or "Milnut"), argued that the law was unconstitutional because of both the Commerce Clause and the Due Process Clause.
In its previous term, the Court had dramatically increased the number of activities considered to be in or to affect interstate commerce.
It had also altered its settled jurisprudence in the area of substantive due process, the doctrine dealing with rights not specifically enumerated in the Constitution.
Justice Harlan Stone, writing for the Court, held that the law was "presumptively constitutional" properly within legislative discretion.
Stone said that legislation aimed at "discrete and insular minorities" without the normal protections of the political process would be one exception to the presumption of constitutionality and justify a heightened standard of judicial review.
It recapitulated common law jurisprudence by which evidence of fraud or other significant legal defects in the transaction, such as self-dealing or other impropriety, may justify overturning a rule.
Nor need we enquire whether similar considerations enter into the review of statutes directed at particular religious, Pierce v. Society of Sisters, 268 U.S. 510, 45 S.Ct.
Nixon v. Herndon, supra; Nixon v. Condon, supra; whether prejudice against discrete and insular minorities may be a special condition, which tends seriously to curtail the operation of those political processes ordinarily to be relied upon to protect minorities, and which may call for a correspondingly more searching judicial inquiry.
734, decided February 14, 1938, note 2, and cases cited.In keeping with the New Deal Revolution, Carolene Products applies the "rational basis test" to economic legislation.
An extremely low standard of judicial review, there is a presumption that the legislation in question is constitutional and the challenging party must show that the law fails the test.
Some argue that the "most famous footnote" was in fact written by not Stone but his law clerk, Louis Lusky.
[4] In fact, the cited work above, while quite useful on the origin and growth of the footnote, does not claim that the law clerk was the author, and it implies the opposite, based on letters between the justices.
In his later work, Our Nine Tribunes: The Supreme Court in Modern America, however, Lusky includes facsimiles of the original drafts of the footnote, the first of which is in his own hand.