American Insurance Ass'n v. Garamendi

src: img.washingtonpost.com

American Insurance Association v. Garamendi, 539 U.S. 396 (2003), was a case in which the Supreme Court of the United States invalidated a California law that required any insurance company wishing to do business in the state to publish information regarding insurance policies held by persons in Europe from 1920 through 1945.

Video American Insurance Ass'n v. Garamendi

Background

The Holocaust Victim Insurance Relief Act (HVIRA) was enacted in 1999 by the California State Legislature in "an attempt to facilitate Holocaust-era insurance claims by California residents." The law required that insurance companies in California that sold policies to people in Europe between 1920 and 1945 to go public with the records of their work during that time, "including the names of policy owners and the status of the policies." American Insurance, along with several other insurance companies and trade associations filed suit claiming that the State of California could not constitutionally create the HVIRA. Rather, it was the federal government's duty to regulate commerce and foreign affairs. The District Court ruled in favor of the plaintiffs, however the 9th Circuit Court of Appeals reversed the decision.

Maps American Insurance Ass'n v. Garamendi

Question before the Supreme Court

Does the HVIRA "interfere with the federal government's sovereignty over foreign affairs established by Article 1 of the Constitution?"

src: i2.wp.com

Decision of the Court

In a 5-4 decision in favor of American Insurance Association, Justice Souter wrote the majority opinion for the Supreme Court. The Court held that California's HVIRA "interfere with the president's ability to conduct the nation's foreign policy and is therefore preempted."