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Most of the cases I studied in law school reside in the cobwebs of my memory like dusty books on a long forgotten shelf. Gibbons v. Ogden, however, is not one of them. Justice Marshall's landmark Supreme Court decision striking down state laws that restrict trade among the states remains eerily fresh. Little did I know that Cornelius Vanderbilt played a major role in the events that led to that 1824 decision.
Thomas Gibbons needed a captain for his steamboats running between New York and Brunswick, N.J. Vanderbilt, a tall, gruff, muscular sailor with experience in those waters, filled the bill. Despite earning $3,000 a year from his own sailing vessels, Vanderbilt knew the future lay with steamships. He sold his boats for $7,000 and went to work for Gibbons.
There was one small problem: the New York State Legislature had given a monopoly on steamboat navigation in New York waters to Robert Fulton and Robert Livingston and threatened to confiscate any ships violating the law. Vanderbilt ignored the law and steamed into various piers in New York, always a step ahead of the authorities. Aaron Ogden, Livingston's successor, sued Gibbons. Gibbons retained the greatest lawyer of the time, Daniel Webster, who argued that the power to regulate commerce was the exclusive province of the Constitution. Supreme Court Chief Justice Marshall agreed: "The acts of the Legislature of the State of New York, granting to Robert R. Livingston and Robert Fulton the exclusive navigation of all the waters within the jurisdiction of that State, with boats moved by fire or steam, for a term of years, are repugnant to that clause of the constitution of the United States, which authorizes Congress to regulate commerce. . ."
Gibbons extended his Union Line with more steamboats and Vanderbilt now pressed the charge by cutting fares. Ogden couldn't compete. He was ruined; his financial resources exhausted by the litigation, and he ended up in debtors prison.
Vanderbilt's star was rising. He not only commanded Gibbons' largest ship, the Thistle, he set the schedules, established fares, managed the operation, hired employees, arranged for advertising and had other Union Line captains reported to him. The waters of New York were his domain from the start.
Vanderbilt was born on Staten Island on May 27, 1794. His father, a farmer and occasional sailor, conceived the idea of a regular boat service between Staten Island and Manhattan. When his brother Jacob died, eleven-year-old Vanderbilt quit school and went to work for his father.
His father was inept, so in 1810 Vanderbilt decided to go on his own. He either borrowed $100 from his mother or got the money by clearing some land for his father and bought his own boat. Myth suggests that a year later he paid his mother back, plus $1,000 for having faith in him. The truth is more likely that he repaid the $100 with a portion of his profits. By the end of the War of 1812, Vanderbilt controlled most of the ferry traffic in New York waters.
He had also fallen in love with his first cousin, Sophia Johnson. Brushing aside his stunned parents' objections, Vanderbilt and Sophia were married on December 19, 1813. They would go on to have 13 children, 10 daughters and three sons, much to Vanderbilt's chagrin because of too many females and three boys he found deficient in all respects.
Plunging every penny he earned into building up a fleet of sailboats plying the Hudson River, Vanderbilt became what his biographer Edward J. Renehan, Jr. called "a purely economic man of the type . . . of [an] Ebenezer Scrooge." His commercial life took precedence over everything else.
In 1826, Gibbons died and his son, William, took over the shipping line. Three years later, without consulting Vanderbilt and without offering Vanderbilt an opportunity to buy the Union Line, William Gibbons placed it for sale on the open market and ultimately sold it to the Stevens family. Vanderbilt . . .