Osborn v. President of the Bank of the United States

9 U.S. 738 · Supreme Court of the United States · 1824

Facts

Ohio imposed a tax on the Bank of the United States, and state officers, including Auditor Ralph Osborn and John L. Harper, seized $100,000 from the Bank's branch. The Bank sought an injunction and restitution of the seized funds, which were subsequently held by state treasurers Currie and Sullivan.

Procedural history

The Bank of the United States filed an original bill in the Circuit Court for the District of Ohio, seeking an injunction against Ralph Osborn, Auditor of Ohio, to restrain him from executing a state law taxing the Bank. An amended and supplemental bill was later filed, adding other parties involved in the collection and holding of the money, including Currie, Sullivan, and Harper. The Circuit Court issued a decree against the defendants, ordering restitution of the seized money and interest. The defendants (appellants) then appealed this decree to the Supreme Court.

Issue

1. Does the Bank of the United States have the right to sue in federal courts? 2. Can federal courts enjoin state officers from executing an unconstitutional state law and order restitution of funds seized under it, without violating the Eleventh Amendment? 3. Is the Ohio law taxing the Bank of the United States constitutional?

Holding

1. Yes, the Bank has the right to sue in federal courts. 2. Yes, federal courts can enjoin state officers and order restitution, as such suits are against the officers as individuals, not the state. 3. No, the Ohio law taxing the Bank is unconstitutional, reaffirming *McCulloch v. Maryland*. The decree for restitution was affirmed, but reversed for interest on the seized coin.

Rule

Federal courts have jurisdiction over cases where a federal question forms an 'ingredient' of the original cause. The Eleventh Amendment does not bar suits against state officers acting under an unconstitutional state law. States cannot tax federal instrumentalities like the Bank of the United States.

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Case brief last reviewed . Prepared by CaseReader from the published opinion.