Brown v. Hovatter

PUBLISHED

UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT

CHARLES BROWN; JOSEPH B. 
JENKINS, III; BRIAN CHISHOLM; GAIL
MANUEL,
Plaintiffs-Appellants,
v.
DAVID HOVATTER; FAYE PETERSON;
MICHAEL RUCK, SR.; GLADYS
SEWELL; DONALD V. BORGWARDT;  No. 08-1121
MARSHALL JONES, JR.; MICHAEL
KRUGER; BRIAN HAIGHT; ROBERT
BRADSHAW; JEFFREY POPE; VERNON
STRAYHORN, SR., in their official
capacities as members of the
Maryland State Board of
Morticians,
Defendants-Appellees.

2 BROWN v. HOVATTER

CHARLES BROWN; JOSEPH B. 
JENKINS, III; BRIAN CHISHOLM; GAIL
MANUEL,
Plaintiffs-Appellees,
v.
DAVID HOVATTER; FAYE PETERSON;
MICHAEL RUCK, SR .; GLADYS
SEWELL; MARSHALL JONES, JR.;  No. 08-1125
MICHAEL KRUGER; DONALD V.
BORGWARDT; ROBERT BRADSHAW;
JEFFREY POPE; BRIAN HAIGHT;
VERNON STRAYHORN, SR., in their
official capacities as members of
the Maryland State Board of
Morticians,
Defendants-Appellants.

Appeals from the United States District Court
for the District of Maryland, at Baltimore.
Richard D. Bennett, District Judge.
(1:06-cv-00524-RDB)

Argued: January 27, 2009

Decided: March 27, 2009

Before NIEMEYER, TRAXLER, and SHEDD,
Circuit Judges.

Affirmed in part and reversed in part by published opinion.
Judge Niemeyer wrote the opinion, in which Judge Traxler
joined. Judge Shedd wrote a separate concurring opinion.
 BROWN v. HOVATTER 3
COUNSEL

ARGUED: Clark Neily, INSTITUTE FOR JUSTICE, Arling-
ton, Virginia, for Appellants/Cross-Appellees. Steven Mar-
shall Sullivan, OFFICE OF THE ATTORNEY GENERAL
OF MARYLAND, Baltimore, Maryland, for Appellees/Cross-
Appellants. ON BRIEF: William H. Mellor, Jeffrey T.
Rowes, INSTITUTE FOR JUSTICE, Arlington, Virginia, for
Appellants/Cross-Appellees. Douglas F. Gansler, Attorney
General of Maryland, Kathleen A. Ellis, Assistant Attorney
General, Grant D. Gerber, Assistant Attorney General,
OFFICE OF THE ATTORNEY GENERAL OF MARY-
LAND, Baltimore, Maryland, for Appellees/Cross-
Appellants.

OPINION

NIEMEYER, Circuit Judge:

Charles Brown, Joseph Jenkins, Brian Chisholm, and Gail
Manuel, who refer to themselves as "funeral and cemetery
entrepreneurs," commenced this action to strike down as
unconstitutional the Maryland Morticians and Funeral Direc-
tors Act (the "Morticians Act"), Md. Health Occ. Code § 7-
101 et seq. They contend that the Act, insofar as it prohibits
corporate ownership of mortician’s licenses and funeral
establishments (except for 58 corporations grandfathered into
the Act in 1945) and unlicensed individual ownership of
funeral establishments (except for surviving spouses and
executors of licensed morticians), violates the Equal Protec-
tion Clause, the Due Process Clause, and the dormant Com-
merce Clause of the U.S. Constitution. They argue:
"Effectively shielded from most out-of-state competition,
Maryland funeral industry members profit handsomely from
the most blatantly anti-competitive funeral regulation in the
nation, [effectively] add[ing] nearly $800 to the cost of a
4 BROWN v. HOVATTER
funeral in Maryland." (Internal quotation marks and record
references omitted). They claim that they are unable to partic-
ipate equitably in Maryland’s funeral industry because of
Maryland’s anticompetitive restrictions on funeral establish-
ment ownership.

The district court, ruling on motions for summary judg-
ment, concluded that the Morticians Act did not violate either
the Equal Protection Clause or the Due Process Clause, but
that it did violate the dormant Commerce Clause. In support
of its dormant Commerce Clause ruling, the court said that the
Act’s "corporate [ownership] prohibition severely limits the
ability of out-of-state businesses from opening a funeral home
in Maryland." The parties filed cross-appeals.

For the reasons that follow, we affirm the district court’s
conclusions with respect to the Equal Protection Clause and
the Due Process Clause for substantially the same reasons
given by the district court. And because Maryland’s licensing
requirements do not unjustifiably burden interstate commerce,
we reverse the district court’s dormant Commerce Clause rul-
ing. At bottom, we conclude that the Morticians Act is consti-
tutional as to each of the plaintiffs’ challenges.

I

The Morticians Act requires individuals who wish to "prac-
tice mortuary science in [Maryland]," to be licensed by the
Maryland State Board of Morticians. Md. Health Occ. Code
§ 7-301(a). To qualify for a license, an individual must be of
good moral character; must have completed an apprentice-
ship; must have a specified educational background; and must
have passed national and Maryland examinations. Id. § 7-
303(b).

The Act also requires any individual who owns a "funeral
establishment" to license the establishment, i.e., "building,
structure, or premises from which the business of practicing
 BROWN v. HOVATTER 5
mortuary science is conducted." Id. §§ 7-310, 7-101(h). Unli-
censed individuals may not own a funeral establishment,
except for spouses and executors of deceased licensed indi-
viduals. Id. §§ 7-310(c)(2), 7-308, 7-308.1.

Corporations, except those grandfathered in as of 1945,
may not be licensed as morticians or funeral directors, id. § 7-
309, and may not own a funeral establishment, see id. § 7-
310. Under the grandfather clause, enacted in 1945, a corpora-
tion, that held a license on June 1, 1945, that has been contin-
ually renewed, may own and operate a funeral establishment
and continue to do so as long as the corporation exists, pro-
vided that "any practice of mortuary science that is conducted
for the corporation is practiced by a licensed individual." Id.
§ 7-309(b), (d). The parties agree that there are 58 corpora-
tions grandfathered under § 7-309(b), that are licensed to
engage in the business or profession of "funeral directing or
embalming," allowing them to own and operate funeral estab-
lishments, and the stock of these corporations is freely trans-
ferable by its owners. Currently, the stock of 3 of the 58
corporations remains in the hands of the original owners, and
the stock of 30 of those corporations is held by out-of-state
public corporations and national chains. The plaintiffs claim
that it can cost up to $250,000 to purchase the stock of a cor-
poration grandfathered to hold a license.

The four plaintiffs wish to own and operate funeral estab-
lishments through the corporate form without being individu-
ally licensed. Brown is a Maryland resident who owns a
cemetery in Hagerstown, Maryland, and who built a funeral
home that is now operated by his son. Because Brown is not
licensed under the Morticians Act, he cannot own the funeral
home he built, but he would like to do so through a corpora-
tion.

Jenkins is a Maryland resident who is licensed as a morti-
cian. He is the supervising mortician of a funeral establish-
ment in Prince George’s County, Maryland, which was built
6 BROWN v. HOVATTER
by his family. He indicates that he would like to own his own
funeral establishment through a corporation. He asserts that
he cannot afford to buy the stock of a grandfathered corpora-
tion that owns a license because the going rate is "up to
$250,000."

Chisholm is a former Maryland resident who now resides
in Florida. He is licensed by Maryland as a mortician and
owns a licensed funeral establishment in Timonium, Mary-
land. Since relocating to Florida in 2005, he states that his
business has been operated by a "subcontractor . . . as the
supervising mortician." He would like to expand his funeral
business in Maryland as an "ordinary business corporation."

Manuel is a Maryland resident who, through a corporation,
owns a cemetery in Waldorf, Maryland. Although she is not
a licensed mortician, Manuel would like to own and operate,
through a corporation, a funeral establishment on the grounds
of her cemetery because "owning a business through a corpo-
ration is the best way to operate." She states, however, that
her plans cannot include paying the "exorbitant price, as much
as $250,000," for the stock of a grandfathered corporation.

In short, each of the plaintiffs wants to engage in the prac-
tice of mortuary science through a corporation, and two wish
to do so without becoming individually licensed. Therefore
each is challenging Maryland’s right to bar corporations from
being licensed as morticians and owning licensed funeral
establishments and to require the owner of a funeral establish-
ment to be a "licensed individual."

The plaintiffs commenced this action against the Maryland
State Board of Morticians and Funeral Directors ("Maryland")
to declare the restrictions unconstitutional and to enjoin their
enforcement. In their complaint, the plaintiffs allege that they
have been denied equal protection of the law, in violation of
the Equal Protection Clause of the Fourteenth Amendment,
because there is no rational reason why they are not permitted
 BROWN v. HOVATTER 7
to own funeral homes either through a corporate form when
grandfathered corporations can do so or as unlicensed individ-
uals when surviving spouses and executors can do so. They
also contend that the Morticians Act denies them the right "to
earn an honest living in the occupation of their choice by
imposing restrictions on the ownership of funeral homes that
are not rationally related to any legitimate public purpose," in
violation of the Due Process Clause of the Fourteenth Amend-
ment. Finally, they allege that but for Maryland’s restrictions
on corporate and unlicensed individual ownership of funeral
homes, persons and companies outside of the State "would
pursue funeral home business opportunities in Maryland that
they are not currently pursuing because of the restriction[s].
This substantial barrier to entry into the Maryland funeral
home industry imposes an undue burden on interstate com-
merce in comparison with the legitimate local interests pro-
tected by the law, which in fact are none" and that therefore
the restrictions on corporate and unlicensed individual owner-
ship violate the dormant Commerce Clause.

On cross-motions for summary judgment, the district court
rejected the plaintiffs’ challenges to the Morticians Act under
the Equal Protection and Due Process Clauses, concluding
that "the Maryland General Assembly could have rationally
determined that the public’s health, safety and welfare are fur-
thered by requiring that a licensed mortician own the funeral
home where mortuary science is practiced." The court, how-
ever, sustained the plaintiffs’ challenge to the Act’s corporate
ownership prohibition under the dormant Commerce Clause,
concluding that it is "a protectionist piece of legislation" that
is "clearly anti-competitive." The court reasoned:

The corporate prohibition severely limits the ability
of out-of-state businesses from opening a funeral
home in Maryland. Even if one of the fifty-eight
licenses does become available, a prospective out-of-
state purchaser must pay an inflated price for the
license. The undisputed record in this case indicates
8 BROWN v. HOVATTER
that these burdens are intolerable and clearly exces-
sive in relation to any benefits proffered by [Mary-
land].

The district court also held that the Morticians Act’s require-
ment that funeral establishments be owned by licensed indi-
viduals was not properly challenged under the dormant
Commerce Clause and that Maryland could require corpora-
tions wishing to own funeral establishments to be themselves
owned by licensed funeral directors or morticians.

The plaintiffs appeal from the portion of the district court’s
judgment upholding the Maryland Morticians Act against
equal protection and due process challenges, as well as the
court’s refusal to consider the licensed individual ownership
requirement under the dormant Commerce Clause. And Mary-
land appeals from the portion of the judgment ruling that the
corporate ownership restriction of the Morticians Act violates
the dormant Commerce Clause. Because the district court
struck down the Morticians Act under the dormant Commerce
Clause, we begin our analysis by addressing that issue.

II

The plaintiffs claim the following to support their argument
that the Morticians Act’s restrictions on corporate and unli-
censed individual ownership of funeral establishments violate
the dormant Commerce Clause: (1) that as a result of the
restrictions, "the rate of out-of-state investment in the Mary-
land funeral industry is significantly lower than it would be
absent the challenged restrictions"; (2) that the restrictions
effectively exclude out-of-state funeral industry entrepreneurs
"from the Maryland funeral market, despite their strong desire
to enter it," because "the only practical way for out-of-state
investors to own funeral homes in Maryland is through corpo-
rate ownership"; and (3) that "Maryland funeral industry
insiders fought indefatigably for over a decade to prevent the
General Assembly from eliminating these restrictions that
 BROWN v. HOVATTER 9
suppress competition and supply the industry [in Maryland]
with windfall profits." They conclude that in these ways the
restrictions "impose significant burdens on interstate com-
merce without any countervailing public benefits," in viola-
tion of the dormant Commerce Clause.

Maryland responds that the restrictions on corporate and
unlicensed individual ownership do not burden interstate
commerce, "even if [they] result[ ] in greater costs or ineffi-
ciencies for certain companies." It notes that "differences
between Maryland’s concededly ‘even handed’ and nondis-
criminatory corporate licensure statute and the laws of other
states are to be expected, and should not be mistaken for a
‘burden’ on interstate commerce." Maryland argues that the
restrictions on funeral establishment ownership are rationally
justified because the use of corporations "causes such busi-
ness to be owned by people who do not know anything about"
the business and because the restrictions foster a greater
degree of accountability to regulators. It claims that the Mary-
land General Assembly had a rational basis for believing that
"limiting funeral home licenses to licensed individuals would
foster a greater degree of accountability to regulators than
would the continued licensing of corporations, which are
inherently designed to limit the personal responsibility of
owners. That rational legislative judgment could reasonably
be expected to yield putative benefits by allowing the [Morti-
cians’] Board to better ‘protect the health and welfare of the
public.’" (Quoting Md. Health Occ. Code § 7-103).

The Commerce Clause states, "The Congress shall have
Power . . . To regulate Commerce . . . among the several
States," U.S. Const. art. I, § 8, cl. 3, and it is well-established
that this affirmative grant of authority implies a "negative" or
"dormant" constraint on the power of the States to enact legis-
lation that interferes with or burdens interstate commerce. See
Dennis v. Higgins, 498 U.S. 439, 447 (1991) ("It is also clear,
however, that the Commerce Clause does more than confer
power on the Federal Government; it is also a substantive
10 BROWN v. HOVATTER
restriction on permissible state regulation of interstate com-
merce" (internal quotation marks and citation omitted));
Healy v. Beer Inst., 491 U.S. 324, 326 n.1 (1989) ("This Court
long has recognized that this affirmative grant of authority to
Congress also encompasses an implicit or ‘dormant’ limita-
tion on the authority of the States to enact legislation affecting
interstate commerce"). As the Supreme Court recently
observed, "The modern law of what has come to be called the
dormant Commerce Clause is driven by concern about eco-
nomic protectionism—that is, regulatory measures designed
to benefit in-state economic interests by burdening out-of-
state competitors." Dep’t of Revenue of Ky. v. Davis, 128 S.
Ct. 1801, 1808 (2008) (internal quotation marks and citation
omitted). The dormant Commerce Clause walks a narrow path
leading courts to "rebuff[ ] attempts of states to advance their
own commercial interests by curtailing the movement of arti-
cles of commerce, either into or out of the state, while gener-
ally supporting their right to impose even burdensome
regulations in the interest of local health and safety." H.P.
Hood & Sons, Inc. v. Du Mond, 336 U.S. 525, 535 (1949).
Thus, not all economic harms or anticompetitive choices are
remedied through the application of the dormant Commerce
Clause, but rather only those that unjustifiably burden inter-
state commerce.

The analysis for determining whether a state law violates
the dormant Commerce Clause proceeds on two tiers. On the
first tier, it inquires whether the state law discriminates
against interstate commerce. Unless discrimination is demon-
strably justified by a factor unrelated to economic protection-
ism, a "discriminatory law is virtually per se invalid." Davis,
128 S. Ct. at 1808 (internal quotation marks and citation omit-
ted); see also Yamaha Motor Corp., U.S.A. v. Jim’s Motorcy-
cle, Inc., 401 F.3d 560, 567 (4th Cir. 2005). If there is no
discrimination, a court will consider on the second tier
whether the state laws "unjustifiably . . . burden the interstate
flow of articles of commerce." Oregon Waste Sys., Inc. v.
Dep’t of Envtl. Quality of Oregon, 511 U.S. 93, 98 (1994); see
 BROWN v. HOVATTER 11
also Yamaha, 401 F.3d at 567. In addressing whether a state
law unjustifiably burdens interstate commerce, the courts gen-
erally apply the so-called Pike test, under which the chal-
lenged law "will be upheld unless the burden imposed on
[interstate] commerce is clearly excessive in relation to the
putative local benefits." Pike v. Bruce Church, Inc., 397 U.S.
137, 142 (1970).

In this case, no contention is made that the Morticians Act
discriminates against interstate commerce, and the district
court concluded that there was no evidence of any discrimina-
tory purpose. Rather, the issue presented is whether the corpo-
rate and individual licensure restrictions in the Morticians Act
burden interstate commerce, and, if so, whether the burden is
"clearly excessive" and not justified by putative local benefits.
We begin that inquiry by identifying the commerce implicated
and how the Morticians Act purportedly burdens it.

The Morticians Act regulates the practice of mortuary sci-
ence in Maryland, which includes the operation of funeral
establishments, the preparation of dead bodies for disposition,
and the arrangement for final disposition of dead bodies. See
Md. Health Occ. Code §§ 7-301(a), 7-302, 7-101(p),(q). The
practice of mortuary science is inherently a local profession,
typically used by relatives to have the bodies of dead family
members prepared for burial or other disposition and to pro-
vide a facility for visitation, mourning, and services. Indeed,
other than providing out-of-state caskets, which are not in any
way regulated by the Morticians Act, the service provided
through the practice of mortuary science begins and ends
within the State.

In licensing the profession and the establishments at which
it is practiced, the Maryland Morticians Act does not purport
to regulate activity outside of Maryland, and it focuses only
on the services provided in Maryland at a funeral establish-
ment in Maryland. Importantly, the regulation does not
address, nor thereby affect, the flow of any goods or articles
12 BROWN v. HOVATTER
of commerce across state lines. The regulation concerns itself
only with the provision of services from a physical establish-
ment in the State. Thus, the Morticians Act purports to regu-
late an industry that is inherently local, not interstate, in
nature.

Moreover, the Morticians Act does not treat persons from
out-of-state any differently than persons in-state. Any person
—out-of-state or in-state—may obtain a license to practice
mortuary science and own and operate a funeral establishment
in Maryland, and there is no limit on the number of licenses
that the State may issue. Likewise, with respect to the 58
grandfathered corporations owning licenses, any person or
corporation, out-of-state or in-state, may own the stock.
Indeed, over one-half of the grandfathered corporations are
owned by publicly-held out-of-state corporations.

In sum, any individual may practice mortuary science in
Maryland, own a funeral establishment in Maryland, or own
the stock of a grandfathered corporation holding a Maryland
license to operate a funeral establishment. The only restric-
tions that are imposed by the Morticians Act relate to profes-
sional education, experience, and accountability. Thus, entry
into the Maryland funeral services market is limited only by
the choices of the individual as to how best to allocate his or
her time and resources.

The dormant Commerce Clause is implicated by burdens
placed on the flow of interstate commerce—the flow of goods,
materials, and other articles of commerce across state lines.
See Oregon Waste Sys., 511 U.S. at 98 (stating that the dor-
mant Commerce Clause "denies the States the power unjusti-
fiably to discriminate against or burden the interstate flow of
articles of commerce"); Hughes v. Alexandria Scrap Corp.,
426 U.S. 794, 803 (1976) (noting that it is "well established
by the history of the Commerce Clause, that this Nation is a
common market in which state lines cannot be made barriers
to the free flow of both raw materials and finished goods in
 BROWN v. HOVATTER 13
response to the economic laws of supply and demand"). And
it is a trade barrier to the free flow of goods, materials, and
other articles of commerce across state lines that violates the
dormant Commerce Clause. The Clause does not purport to
restrict or limit intrastate commerce, nor protect the partici-
pants in intrastate or interstate markets, nor the participants’
chosen way of doing business. See Exxon Corp. v. Governor
of Md., 437 U.S. 117, 127 (1978) ("We cannot . . . accept
appellants’ underlying notion that the Commerce Clause pro-
tects the particular structure or methods of operation in a retail
market" or "particular interstate firms").

Yet, it is precisely the particular structure or methods of
operation in the Maryland retail market for funeral services
about which the plaintiffs in this case complain, not about a
burden on the flow of articles of commerce across state lines.
Their complaints about the regulation center around either the
inconveniences presented to them personally or the restric-
tions on how they would prefer to run their businesses when
operating in Maryland.

They assert that corporate ownership of funeral establish-
ments would facilitate financing, would protect them from
personal liability, and would enable them to pass the business
on to others, particularly family members. In addition, they
state that operating through a corporation would simply be a
preferable way of doing business. Brown states, "I want to
own and operate a funeral establishment on the grounds of
Rest Haven Cemetery, but I do not want to become a licensed
mortician." Jenkins states, "It is no coincidence that the larg-
est funeral establishments in Maryland . . . are set up through
the 58 special corporate licenses under the ‘grandfather’
clause. I simply want to be able to do what the law allows
those businesses and businesspeople to do." Chisholm, who is
a mortician licensed in Maryland but who lives in Florida,
states, "[T]he challenges of running a Maryland business from
Florida, particularly with respect to financing and liability,
make corporate ownership essential if I am to expand Chis-
14 BROWN v. HOVATTER
holm Funeral Services according to my plans." And Manuel
states: "Neither my husband nor I want to devote the time and
money to becoming licensed funeral directors or morticians.
. . . Ideally, we want to own and operate our proposed funeral
home as an ordinary business corporation . . . [but] [o]ur plans
do not allow us to pay the exorbitant price, as much as
$250,000, that one of these ‘grandfather’ corporations cost."

In short, the plaintiffs are challenging the way Maryland
authorizes them to do business within the State in a profession
regulated by the State. Their complaints do not involve bur-
dens placed on the interstate movement of goods, materials,
or other articles of commerce, and the matters of which they
complain—the manner of professional practice in Maryland—
are not matters protected by the dormant Commerce Clause.
As the Supreme Court stated in Exxon, "We cannot . . . accept
appellants’ underlying notion that the Commerce Clause pro-
tects the particular structure or methods of operation in a retail
market. . . . [T]he Clause protects the interstate market, not
particular interstate firms, from prohibitive or burdensome
regulations." Exxon, 437 U.S. at 127-28.

In Exxon, a Maryland statute provided that producers or
refiners of petroleum products, such as Exxon and Shell,
could not operate retail service stations within Maryland.
Exxon and other petroleum producers and refiners challenged
the statute on constitutional grounds, including the dormant
Commerce Clause, pointing to evidence that the statute’s
divesture requirements would cause at least three refiners to
stop selling gasoline in Maryland, depriving consumers of
competition and even certain special services. The Supreme
Court rejected the argument, noting that "interstate commerce
is not subjected to an impermissible burden simply because an
otherwise valid regulation causes some business to shift from
one interstate supplier to another," even if it will "change the
market structure by weakening independent refiners." Exxon,
437 U.S. at 127. The Court explained:
 BROWN v. HOVATTER 15
[T]he Clause protects the interstate market, not par-
ticular interstate firms, from prohibitive or burden-
some regulations. It may be true that the consuming
public will be injured by the loss of the high-volume,
low-priced stations operated by the independent
refiners, but again that argument relates to the wis-
dom of the statute, not to its burden on commerce.

Id. at 127-28.

Likewise in the case before us, the Morticians Act "does
not prohibit the flow of interstate goods, place added costs
upon them, or distinguish between in-state and out-of-state
companies in the retail market." Exxon, 437 U.S. at 126. In
fact, large funeral home conglomerates have a presence in the
Maryland funeral services market, albeit not as large as they
would like. But the fact that the burden of this permissible
state regulation falls on corporations that may have interstate
operations "does not, by itself, establish a [violation of the
dormant Commerce Clause]." Id.

Further, just like the oil companies in Exxon, the plaintiffs
complain that the Morticians Act hurts Maryland consumers
and drives up the costs of funerals. The burden of this regula-
tion, however, falls on Maryland consumers, not on interstate
commerce, and a complaint about this burden "relates to the
wisdom of the [Maryland] statute, not to its burden on [inter-
state] commerce." Exxon, 436 U.S. at 128 (emphasis added).

The plaintiffs rely heavily on our decision in Yamaha
Motor Corp., U.S.A. v. Jim’s Motorcycle, Inc., 401 F.3d 560
(4th Cir. 2005), to support their claim that the Morticians Act
violates the dormant Commerce Clause. They assert that
Yamaha, which struck down a Virginia statute under the dor-
mant Commerce Clause, is "directly on-point and provided
the legal basis for the district court’s commerce clause ruling"
in this case.
16 BROWN v. HOVATTER
In Yamaha, the Virginia statute at issue provided protection
to existing motorcycle dealers in Virginia against the creation
of new dealerships by motorcycle manufacturers and distribu-
tors such as Yamaha and Harley-Davidson, by giving the
existing dealers the right to protest the creation of a new
dealership through a process that "could take years to
resolve," even if the protest were "frivolous." Yamaha, 401
F.3d at 571 (internal quotation marks and citation omitted).
Moreover, a dealer could protest the appointment of a new
dealer even if the new dealership were across the State, some
500 miles away and indisputably outside of the relevant mar-
ket of the protesting dealer for selling motorcycles. Id.
Yamaha, an out-of-state manufacturer and distributor of
motorcycles, challenged the statute under the dormant Com-
merce Clause, arguing that the Virginia statute created an
unjustifiable burden on interstate commerce by burdening
Yamaha’s ability to distribute motorcycles in Virginia. Agree-
ing with Yamaha’s claim, we concluded that the Virginia stat-
ute did indeed "create[ ] a significant barrier to market entry
. . . because of the virtual certainty of a protest whenever a
manufacturer attempts to authorize a new dealership." Id.
(internal quotation marks and citations omitted). Because the
delay in costs in the face of increasing demand in Virginia for
motorcycles caused Yamaha and Harley-Davidson to forego
establishing new dealers, we concluded that the Virginia stat-
ute imposed "heavy burdens predominantly on out-of-state
interests" and thus "unduly burden[ed] commerce." Id. at 573.

Thus, Yamaha invalidated a statute that was aimed at the
interstate flow of motorcycles into Virginia. Unlike in
Yamaha, however, the Maryland Morticians Act is not aimed
at any interstate flow of goods, materials, or articles of com-
merce. The Morticians Act is a local regulation of a localized
profession where services are performed for clients entirely in
Maryland. Rather than aiming at the interstate flow of com-
merce, the Morticians Act is aimed at making morticians and
funeral directors in Maryland directly accountable to clients
who come to them in Maryland to provide funeral services at
 BROWN v. HOVATTER 17
their funeral establishments in Maryland. Yamaha does not
advance the plaintiffs’ argument that the Morticians Act
imposes an unjustified burden on interstate commerce.

Because the Morticians Act does not place a barrier or bur-
den on the flow of interstate commerce, it does not violate the
dormant Commerce Clause. But even if it was considered to
place an incidental burden on commerce, that incidental bur-
den would not be excessive in light of the putative benefits
from the Act’s regulation.

While Maryland does not have extensive records explain-
ing the purpose of the Act, the Supreme Court has recognized
that promoting familiarity between an owner and his business
in a licensed and regulated industry is a legitimate local inter-
est. See North Dakota State Bd. of Pharmacy v. Snyder’s
Drug Stores, Inc., 414 U.S. 156, 166-67 (1973); see also
Goldfarb v. Supreme Court of Va., 766 F.2d 859, 862 (4th
Cir. 1985) (recognizing that a state law exempting from
examination lawyers licensed out of state who moved into
Virginia to practice full time provides a putative local benefit
because "the full-time practice requirement promotes famil-
iarity with Virginia law among attorneys who have not passed
the state bar examination"); id. (recognizing the "broad power
[of States] to establish standards for licensing practitioners
and regulating the practice of professions" (internal quotation
marks and citation omitted)). More broadly, a State "has a
substantial interest in preventing the corporate form from
becoming a shield for unfair business dealing." CTS Corp. v.
Dynamics Corp. of Am., 481 U.S. 69, 93 (1987). The district
court recognized that these very principles apply in this case
to support "the notion that ownership of corporations may be
limited in highly skilled occupations where licensing is
required, such as mortuary science."

Maryland asserts that "limiting funeral home licenses to
licensed individuals [will] foster a greater degree of account-
ability to regulators than would the continued licensing of
18 BROWN v. HOVATTER
corporations, which are inherently designed to limit the per-
sonal responsibility of owners. That rational legislative judg-
ment could reasonably be expected to yield putative benefits
by allowing the [Morticians’] Board to better ‘protect the
health and welfare of the public.’" (Quoting Md. Health Occ.
Code § 7-103). And the State’s position is indeed advanced
by the complaint in this case and the affidavits of the plain-
tiffs where they assert that they desire to use the corporate
form because they "want to be insulated from personal liabil-
ity for . . . negligence." This is precisely the kind of personal
responsibility that the Morticians Act wishes to maintain.
Indeed, the Maryland State Board of Morticians expressed
this concern, claiming that unlicensed individuals and corpo-
rations would be less accountable. Thus, the Morticians Act
provides individual liability and therefore more direct
accountability for owners of funeral establishments while the
plaintiffs desire less individual liability. This is the type of
legislative decisionmaking into which courts should avoid
inserting themselves. See, e.g., Powers v. Harris, 379 F.3d
1208, 1222 (10th Cir. 2004) ("While the creation of such a
libertarian paradise may be a worthy goal, Plaintiffs must turn
to the . . . electorate for its institution, not us").

In short, we conclude that the Morticians Act’s incidental
burden on interstate commerce is not excessive and is justi-
fied by the very real benefits of protecting the public health,
safety, and welfare by encouraging familiarity of the owner of
a funeral business with the day-to-day workings of that busi-
ness and creating accountability to regulators and to clients.
Accordingly, we reverse the district court’s conclusion that
the Act violates the dormant Commerce Clause.

III

In addressing plaintiffs’ Due Process and Equal Protection
Clause arguments, we agree with the district court’s reasoning
rejecting these arguments. Because the Morticians Act is an
economic regulation, we may not strike it down unless it is
 BROWN v. HOVATTER 19
"wholly arbitrary, without any basis in reason." Guardian
Plans Inc. v. Teague, 870 F.2d 123, 126 (4th Cir. 1989) (inter-
nal quotation marks and citation omitted). In other words, to
survive such challenges, the Act need only be "rationally
related to a legitimate state interest." Id.

Our court has already recognized that a State has a "legiti-
mate interest in protecting the health, safety and welfare of its
citizens through regulation of the funeral profession." Guard-
ian Plans, 870 F.2d at 126. A State’s legislature may "ratio-
nally determine[ ] that keeping the arrangement of funerals in
the hands of licensed funeral professionals would benefit the
public by ensuring competence in funeral arrangement. Our
inquiry [under the Equal Protection and Due Process Clauses]
ends here." Id.

Moreover, there is a rational basis to restrict corporate and
unlicensed individual ownership of professional businesses.
See North Dakota Pharmacy Bd., 414 U.S. at 166-67. In
North Dakota Pharmacy Board, the North Dakota legislature
required that in order to obtain a permit to operate a phar-
macy, the applicant had to be a registered pharmacist in good
standing or a corporation or association, the majority of
whose stock must be owned by registered pharmacists in good
standing who are active in the day-to-day affairs of the corpo-
ration or association. In upholding those restrictions on corpo-
rate ownership, the Supreme Court explained that a rational
relationship exists between restricting corporate ownership
and the professions, quoting with approval Justice Holmes’
dissenting opinion in Louis K. Liggett Co. v. Baldridge, 278
U.S. 105, 114-15 (1928) (Holmes, J. dissenting):

"A standing criticism of the use of corporations in
business is that it causes such business to be owned
by people who do not know anything about it. Argu-
ment has not been supposed to be necessary in order
to show that the divorce between the power of con-
trol and knowledge is an evil. The selling of drugs
20 BROWN v. HOVATTER
and poisons calls for knowledge in a high degree,
and [the State] after enacting a series of other safe-
guards has provided that in that matter the divorce
shall not be allowed. Of course, notwithstanding the
requirement that in corporations hereafter formed all
the stockholders shall be licensed pharmacists, it still
would be possible for a stockholder to content him-
self with drawing dividends and to take no hand in
the company’s affairs. But obviously he would be
more likely to observe the business with an intelli-
gent eye than a casual investor who looked only to
the standing of the stock in the market. The Constitu-
tion does not make it a condition of preventive legis-
lation that it should work a perfect cure. It is enough
if the questioned act has a manifest tendency to cure
or at least to make the evil less."

North Dakota State Bd., 414 U.S. at 166-67. The same ratio-
nality exists for upholding the restrictions on corporate and
unlicensed individual ownership in the Morticians Act.

The rationality of restricting corporate ownership in the
Morticians Act is not undermined by exemptions contained in
the Act, so long as the exemptions too are rationally based.
See Goldfarb, 766 F.2d at 862-63 (finding rational an exemp-
tion from a state bar exam for out-of-state lawyers who
moved to Virginia to practice full time even though bar appli-
cants generally must take the bar exam before being licensed).

In the Morticians Act, corporations that historically held
licenses in the funeral business were allowed to continue to
hold licenses because the General Assembly wanted to protect
reliance interests of family members. For a similar reason,
spouses of deceased licensees are exempted from being
licensed to allow the spouse, who presumably was already
involved in the affairs of the business, to continue the busi-
ness. The Act also provides an exemption for executors of
licensees, allowing the temporary operation of the funeral
 BROWN v. HOVATTER 21
establishment to wind down the affairs of the business. The
fact that the General Assembly created these rational exemp-
tions does not undermine the overall rationality of the Morti-
cians Act based on its relationship to a legitimate government
purpose. See Goldfarb, 766 F.2d at 862-63.

The plaintiffs’ position boils down to a disagreement with
the General Assembly’s judgment in refusing to authorize a
different structure for practicing mortuary science in Mary-
land. This disagreement, however, is not a basis on which to
render the Morticians Act unconstitutional.

[A] law may exact a needless, wasteful requirement
in many cases. But it is for the legislature, not the
courts, to balance the advantages and disadvantages
of the . . . requirement.

***

[T]he law need not be in every respect logically con-
sistent with its aims to be constitutional. It is enough
that there is an evil at hand for correction, and that
it might be thought that the particular legislative
measure was a rational way to correct it.

The day is gone when this Court uses the Due Pro-
cess Clause of the Fourteenth Amendment to strike
down state laws, regulatory of business and indus-
trial conditions, because they may be unwise,
improvident, or out of harmony with a particular
school of thought. . . . For protection against abuses
by legislatures the people must resort to the polls,
not to the courts.

Williamson v. Lee Optical of Okla., Inc., 348 U.S. 483, 487-
88 (1955) (internal quotation marks and citations omitted).
22 BROWN v. HOVATTER
IV

We conclude that the Morticians Act does not violate the
dormant Commerce Clause, and accordingly we reverse the
district court’s judgment in that regard. We also conclude that
the Act does not violate either the Equal Protection Clause or
the Due Process Clause, and accordingly we affirm the district
court in that regard.

The judgment of the district court is therefore

AFFIRMED IN PART AND REVERSED IN PART.

SHEDD, Circuit Judge, concurring:

I concur in the judgment reached by the majority. As to the
dormant Commerce Clause issue, I concur to the extent that
we find "that the Morticians Act’s incidental burden on inter-
state commerce is not excessive and is justified by the very
real benefits of protecting the public health, safety, and wel-
fare by encouraging familiarity of the owner of a funeral busi-
ness with the day-to-day workings of that business and
creating accountability to regulators and to clients." See
Majority Op. at 18.