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Ford Motor Co. v. Texas Dept. of Transportation

Texas Motor Vehicle Commission Code '5.02C(c)'s incidental regulation of Internet activities does not violate the commerce clause, the First Amendment or the equal protection clause.

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Appeal from the United States District Court or the Western District of Texas

This case involves Ford Motor Company’s (“Ford”) attempt to market preowned vehicles in Texas via their internet site known as The Showroom. On November 2, 1999, the Texas Motor Vehicle Division (“the State”) filed an administrative complaint against Ford with the Texas Motor Vehicle Board. In the complaint, the State alleged that Ford violated the Texas Motor Vehicle Commission Code (“the Code”), Tex. Rev. Civ. Stat. art. 4413(36), �� 4.01, .06(a)(3), (6) & 5.02C(c), as well as Tex. Transp. Code � 503.021, by selling used vehicles to Texas consumers without a dealer’s license. Section 4.01(a) of the Code makes it unlawful to “engage in business as, serve in the capacity of, or act as a[n] [automobile] dealer . . . without first obtaining a license.”*fn1 Ford is ineligible under Texas law to receive a license because � 5.02C(c) provides that:

(c) Except as provided by this section, a manufacturer or distributor may not directly or indirectly:

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