Panama Refining Co. v. Ryan

In the case Panama Refining Co. v. Ryan (293 U.S. 388), the Supreme Court of the United States on January7, 1935 ruled unconstitutional the Roosevelt Administration's prohibition of interstate and foreign trade in petroleum goods produced in excess of state quotas - the "hot oil" orders adopted under the 1933 National Industrial Recovery Act.

The ruling was the first of several which overturned key elements of the Administration's New Deal legislative program. The relevant section 9(c) of the NIRA was found to be an unconstitutional delegation of legislative power in that it permitted Presidential interdiction of trade without defining criteria for the application of the proposed restriction.

The finding thus differed from later Court rulings which argued that Federal government action affecting intrastate production breached the Commerce Clause of the Constitution: in Panama v. Ryan it was paradoxically the omission of Congressional guidance on state petroleum production ceilings which occasioned the adverse ruling.