source: Caselaw Access Project

author: Justice Stevens

license: Public Domain

text:
    ASPEN SKIING CO. v. ASPEN HIGHLANDS SKIING CORP.
    No. 84-510.
    Argued March 27, 1985
    Decided June 19, 1985

      Stevens, J., delivered the opinion of the Court, in which all other Members joined, except White, J., who took no part in the decision of the case.

      Richard, M. Cooper argued the cause for petitioner. With him on the briefs were Edward Bennett Williams, Harold Ungar, David G. Palmer, and William W. Maywhort.

      Tucker K. Trautman argued the cause for respondent. With him on the brief were John H. Evans, Owen C. Rouse, and John H. Shenefield.

         Robert E. Cooper and Theodore B. Olson filed a brief for American Airlines, Inc., as amicus curiae urging reversal.

   Justice Stevens

delivered the opinion of the Court.

In a private treble-damages action, the jury found that petitioner Aspen Skiing Company (Ski Co.) had monopolized the market for downhill skiing services in Aspen, Colorado. The question presented is whether that finding is erroneous as a matter of law because it rests on an assumption that a firm with monopoly power has a duty to cooperate with its smaller rivals in a marketing arrangement in order to avoid violating §2 of the Sherman Act.

Aspen is a destination ski resort with a reputation for “super powder,” “a wide range of runs,” and an “active night life,” including “some of the best restaurants in North America.” Tr. 765-767. Between 1945 and 1960, private investors independently developed three major facilities for downhill skiing: Aspen Mountain (Ajax), Aspen Highlands (Highlands), and Buttermilk. A fourth mountain, Snow-mass, opened in 1967.

The development of any major additional facilities is hindered by practical considerations and regulatory obstacles. The identification of appropriate topographical conditions for a new site and substantial financing are both essential. Most of the terrain in the vicinity of Aspen that is suitable for downhill skiing cannot be used for that purpose without the approval of the United States Forest Service. That approval is contingent, in part, on environmental concerns. Moreover, the county government must also approve the project, and in recent years it has followed a policy of limiting growth.

Between 1958 and 1964, three independent companies operated Ajax, Highlands, and Buttermilk. In the early years, each company offered its own day or half-day tickets for use of its mountain. Id., at 152. In 1962, however, the three competitors also introduced an interchangeable ticket. Id., at 1634. The 6-day, all-Aspen ticket provided convenience to the vast majority of skiers who visited the resort for weekly periods, but preferred to remain flexible about what mountain they might ski each day during the visit. App. 92. It also emphasized the unusual variety in ski mountains available in Aspen.

As initially designed, the all-Aspen ticket program consisted of booklets containing six coupons, each redeemable for a daily lift ticket at Ajax, Highlands, or Buttermilk. The price of the booklet was often discounted from the price of six daily tickets, but all six coupons had to be used within a limited period of time — seven days, for example. The revenues from the sale of the 3-area coupon books were distributed in accordance with the number of coupons collected at each mountain. Tr. 153, 1634-1638.

In 1964, Buttermilk was purchased by Ski Co., but the interchangeable ticket program continued. In most seasons after it acquired Buttermilk, Ski Co. offered 2-area, 6- or 7-day tickets featuring Ajax and Buttermilk in competition with the 3-area, 6-coupon booklet. Although it sold briskly, the all-Aspen ticket did not sell as well as Ski Co.’s multiarea ticket until Ski Co. opened Snowmass in 1967. Thereafter, the all-Aspen coupon booklet began to outsell Ski Co.’s ticket featuring only its mountains. Record Ex. LL; Tr. 1646, 1675-1676.

In the 1971-1972 season, the coupon booklets were discontinued and an “around the neck” all-Aspen ticket was developed. This refinement on the interchangeable ticket was advantageous to the skier, who no longer found it necessary to visit the ticket window every morning before gaining access to the slopes. Lift operators at Highlands monitored usage of the ticket in the 1971-1972 season by recording the ticket numbers of persons going onto the slopes of that mountain. Highlands officials periodically met with Ski Co. officials to review the figures recorded at Highlands, and to distribute revenues based on that count. Id., at 1622, 1639.

There was some concern that usage of the all-Aspen ticket should be monitored by a more scientific method than the one used in the 1971-1972 season. After a one-season absence, the 4-area ticket returned in the 1973-1974 season with a new method of allocating revenues based on usage. Like the 1971-1972 ticket, the 1973-1974 4-area ticket consisted of a badge worn around the skier’s neck. Lift operators punched the ticket when the skier first sought access to the mountain each day. A random-sample survey was commissioned to determine how many skiers with the 4-area ticket used each mountain, and the parties allocated revenues from the ticket sales in accordance with the survey’s results.

In the next four seasons, Ski Co. and Highlands used such surveys to allocate the revenues from the 4-area, 6-day ticket. Highlands’ share of the revenues from the ticket was 17.5% in 1973-1974, 18.5% in 1974-1975, 16.8% in 1975-1976, and 13.2% in 1976-1977. During these four seasons, Ski Co. did not offer its own 3-area, multiday ticket in competition with the all-Aspen ticket. By 1977, multiarea tickets accounted for nearly 35% of the total market. Id., at 614, 1367. Holders of multiarea passes also accounted for additional daily ticket sales to persons skiing with them.

Between 1962 and 1977, Ski Co. and Highlands had independently offered various mixes of 1-day, 3-day, and 6-day passes at their own mountains. In every season except one, however, they had also offered some form of all-Aspen, 6-day ticket, and divided the revenues from those sales on the basis of usage. Nevertheless, for the 1977-1978 season, Ski Co. offered to continue the all-Aspen ticket only if Highlands would accept a 13.2% fixed share of the ticket’s revenues.

Although that had been Highlands’ share of the ticket revenues in 1976-1977, Highlands contended that that season was an inaccurate measure of its market performance since it had been marked by unfavorable weather and an unusually low number of visiting skiers. Moreover, Highlands wanted to continue to divide revenues on the basis of actual usage, as that method of distribution allowed it to compete for the daily loyalties of the skiers who had purchased the tickets. Tr. 172. Fearing that the alternative might be no interchangeable ticket at all, and hoping to persuade Ski Co. to reinstate the usage division of revenues, Highlands eventually accepted a fixed percentage of 15% for the 1977-1978 season. Ibid. No survey was made during that season of actual usage of the 4-area ticket at the two competitors’ mountains.

In the 1970’s the management of Ski Co. increasingly expressed their dislike for the all-Aspen ticket. They complained that a coupon method of monitoring usage was administratively cumbersome. They doubted the accuracy of the survey and decried the “appearance, deportment, [and] attitude” of the college students who were conducting it. Id., at 1627. See also id., at 398, 405-407, 959. In addition, Ski Co.’s president had expressed the view that the 4-area ticket was siphoning off revenues that could be recaptured by Ski Co. if the ticket was discontinued. Id., at 586-587, 950, 960. In fact, Ski Co. had reinstated its 3-area, 6-day ticket during the 1977-1978 season, but that ticket had been outsold by the 4-area, 6-day ticket nearly two to one. Id., at 613-614.

In March 1978, the Ski Co. management recommended to the board of directors that the 4-area ticket be discontinued for the 1978-1979 season. The board decided to offer Highlands a 4-area ticket provided that Highlands would agree to receive a 12.5% fixed percentage of the revenue — considerably below Highlands’ historical average based on usage. Id., at 396, 585-586. Later in the 1978-1979 season, a member of Ski Co.’s board of directors candidly informed a Highlands official that he had advocated making Highlands “an offer that [it] could not accept.” Id., at 361.

Finding the proposal unacceptable, Highlands suggested a distribution of the revenues based on usage to be monitored by coupons, electronic counting, or random sample surveys. Id., at 188. If Ski Co. was concerned about who was to conduct the survey, Highlands proposed to hire disinterested ticket counters at its own expense — “somebody like Price Waterhouse” — to count or survey usage of the 4-area ticket at Highlands. Id,., at 191. Ski Co. refused to consider any counterproposals, and Highlands finally rejected the offer of the fixed percentage.

As far as Ski Co. was concerned, the all-Aspen ticket was dead. In its place Ski Co. offered the 3-area, 6-day ticket featuring only its mountains. In an effort to promote this ticket, Ski Co. embarked on a national advertising campaign that strongly implied to people who were unfamiliar with Aspen that Ajax, Buttermilk, and Snowmass were the only ski mountains in the area. For example, Ski Co. had a sign changed in the Aspen Airways waiting room at Stapleton Airport in Denver. The old sign had a picture of the four mountains in Aspen touting “Four Big Mountains” whereas the new sign retained the picture but referred only to three. Id., at 844, 847, 858-859.

Ski Co. took additional actions that made it extremely difficult for Highlands to market its own multiarea package to replace the joint offering. Ski Co. discontinued the 3-day, 3-area pass for the 1978-1979 season, and also refused to sell Highlands any lift tickets, either at the tour operator’s discount or at retail. Id., at 327. Highlands finally developed an alternative product, the “Adventure Pack,” which consisted of a 3-day pass at Highlands and three vouchers, each equal to the price of a daily lift ticket at a Ski Co. mountain. The vouchers were guaranteed by funds on deposit in an Aspen bank, and were redeemed by Aspen merchants at full value. Id., at 329-334. Ski Co., however, refused to accept them.

Later, Highlands redesigned the Adventure Pack to contain American Express Traveler’s Checks or money orders instead of vouchers. Ski Co. eventually accepted these negotiable instruments in exchange for daily lift tickets. Id., at 505, 507, 549. Despite some strengths of the product, the Adventure Pack met considerable resistance from tour operators and consumers who had grown accustomed to the convenience and flexibility provided by the all-Aspen ticket. Id., at 784-785, 1041.

Without a convenient all-Aspen ticket, Highlands basically “becomes a day ski area in a destination resort.” Id., at 1425. Highlands’ share of the market for downhill skiing services in Aspen declined steadily after the 4-area ticket based on usage was abolished in 1977: from 20.5% in 1976-1977, to 15.7% in 1977-1978, to 13.1% in 1978-1979, to 12.5% in 1979-1980, to 11% in 1980-1981. Record Ex. No. 97, App. 188. Highlands’ revenues from associated skiing services like the ski school, ski rentals, amateur racing events, and restaurant facilities declined sharply as' well.

HH HH

In 1979, Highlands filed a complaint in the United States District Court for the District of Colorado naming Ski Co. as a defendant. Among various claims, the complaint alleged that Ski Co. had monopolized the market for downhill skiing services at Aspen in violation of § 2 of the Sherman Act, and prayed for treble damages. The case was tried to a jury which rendered a verdict finding Ski Co. guilty of the §2 violation and calculating Highlands’ actual damages at $2.5 million. App. 187-190.

In her instructions to the jury, the District Judge explained that the offense of monopolization under §2 of the Sherman Act has two elements: (1) the possession of monopoly power in a relevant market, and (2) the willful acquisition, maintenance, or use of that power by anticompetitive or exclusionary means or for anticompetitive or exclusionary purposes. Tr. 2310. Although the first element was vigorously disputed at the trial and in the Court of Appeals, in this Court Ski Co. does not challenge the jury’s special verdict finding that it possessed monopoly power. Nor does Ski Co. criticize the trial court’s instructions to the jury concerning the second element of the § 2 offense.

On this element, the jury was instructed that it had to consider whether “Aspen Skiing Corporation willfully acquired, maintained, or used that power by anti-competitive or exclusionary means or for anti-competitive or exclusionary purposes.” App. 181. The instructions elaborated:

“In considering whether the means or purposes were anti-competitive or exclusionary, you must draw a distinction here between practices which tend to exclude or restrict competition on the one hand and the success of a business which reflects only a superior product, a well-run business, or luck, on the other. The line between legitimately gained monopoly, its proper use and maintenance, and improper conduct has been described in various ways. It has been said that obtaining or maintaining monopoly power cannot represent monopolization if the power was gained and maintained by conduct that was honestly industrial. Or it is said that monopoly power which is thrust upon a firm due to its superior business ability and efficiency does not constitute monopolization.
“For example, a firm that has lawfully acquired a monopoly position is not barred from taking advantage of scale economies by constructing a large and efficient factory. These benefits are a consequence of size and not an exercise of monopoly power. Nor is a corporation which possesses monopoly power under a duty to cooperate with its business rivals. Also a company which possesses monopoly power and which refuses to enter into a joint operating agreement with a competitor or otherwise refuses to deal with a competitor in some manner does not violate Section 2 if valid business reasons exist for that refusal.
“In other words, if there were legitimate business reasons for the refusal, then the defendant, even if he is found to possess monopoly power in a relevant market, has not violated the law. We are concerned with conduct which unnecessarily excludes or handicaps competitors. This is conduct which does not benefit consumers by making a better product or service available — or in other ways — and instead has the effect of impairing competition.
“To sum up, you must determine whether Aspen Skiing Corporation gained, maintained, or used monopoly power in a relevant market by arrangements and policies which rather than being a consequence of a superior product, superior business sense, or historic element, were designed primarily to further any domination of the relevant market or sub-market.” Id., at 181-182.

The jury answered a specific interrogatory finding the second element of the offense as defined in these instructions.

Ski Co. filed a motion for judgment notwithstanding the verdict, contending that the evidence was insufficient to support a § 2 violation as a matter of law. In support of that motion, Ski Co. incorporated the arguments that it had advanced in support of its motion for a directed verdict, at which time it had primarily contested the sufficiency of the evidence on the issue of monopoly power. Counsel had, however, in the course of the argument at that time, stated: “Now, we also think, Judge, that there clearly cannot be a requirement of cooperation between competitors.” Tr. 1452. The District Court denied Ski Co.’s motion and entered a judgment awarding Highlands treble damages of $7,500,000, costs, and attorney’s fees. App. 191-192.

The Court of Appeals affirmed in all respects. 738 F. 2d 1509 (CA10 1984). The court advanced two reasons for rejecting Ski Co.’s argument that “‘there was insufficient evidence to present a jury issue of monopolization because, as a matter of law, the conduct at issue was pro-competitive conduct that a monopolist could lawfully engage in.’” First, relying on United States v. Terminal Railroad Assn. of St. Louis, 224 U. S. 383 (1912), the Court of Appeals held that the multiday, multiarea ticket could be characterized as an “essential facility” that Ski Co. had a duty to market jointly with Highlands. 738 F. 2d, at 1520-1521. Second, it held that there was sufficient evidence to support a finding that Ski Co.’s intent in refusing to market the 4-area ticket, “considered together with its other conduct,” was to create or maintain a monopoly. Id., at 1522.

In its review of the evidence on the question of intent, the Court of Appeals considered the record “as a whole” and concluded that it was not necessary for Highlands to prove that each allegedly anticompetitive act was itself sufficient to demonstrate an abuse of monopoly power. Id., at 1522, n. 18. The court noted that by “refusing to cooperate” with Highlands, Ski Co. “became the only business in Aspen that could offer a multi-day multi-mountain skiing experience”; that the refusal to offer a 4-mountain ticket resulted in “skiers’ frustration over its unavailability”; that there was apparently no valid business reason for refusing to accept the coupons in Highlands’ Adventure Pack; and that after Highlands had modified its Adventure Pack to meet Ski Co.’s objections, Ski Co. had increased its single ticket price to $22 “thereby mhking it unprofitable ... to market [the] Adventure Pack.” Id., at 1521-1522. In reviewing Ski Co.’s argument that it was entitled to a directed verdict, the Court of Appeals assumed that the jury had resolved all contested questions of fact in Highlands’ favor.

HH HH HH

In this Court, Ski Co. contends that even a firm with monopoly power has no duty to engage in joint marketing with a competitor, that a violation of §2 cannot be established without evidence of substantial exclusionary conduct, and that none of its activities can be characterized as exclusionary. It also contends that the Court of Appeals incorrectly relied on the “essential facilities” doctrine and that an “anti-competitive intent” does not transform nonexclusionary conduct into monopolization. In response, Highlands submits that, given the evidence in the record, it is not necessary to rely on the “essential facilities” doctrine in order to affirm the judgment. Tr. of Oral Arg. 34.

“The central messagé of the Sherman Act is that a business entity must find new customers and higher profits through internal expansion — that is, by competing successfully rather than by arranging treaties with its competitors.” United States v. Citizens & Southern National Bank, 422 U. S. 86, 116 (1975). Ski Co., therefore, is surely correct in submitting that even a firm with monopoly power has no general duty to engage in a joint marketing program with a competitor. Ski Co. is quite wrong, however, in suggesting that the judgment in this case rests on any such proposition of law. For the trial court unambiguously instructed the jury that a firm possessing monopoly power has no duty to cooperate with its business rivals. Supra, at 596-597.

The absence of an unqualified duty to cooperate does not mean that every time a firm declines to participate in a particular cooperative venture, that decision may not have evi-dentiary significance, or that it may not give rise to liability in certain circumstances. The absence of a duty to transact business with another firm is, in some respects, merely the counterpart of the independent businessman’s cherished right to select his customers and his associates. The high value that we have placed on the right to refuse to deal with other firms does not mean that the right is unqualified.

In Lorain Journal Co. v. United States, 342 U. S. 143 (1951), we squarely held that this right was not unqualified. Between 1933 and 1948 the publisher of the Lorain Journal, a newspaper, was the only local business disseminating news and advertising in that Ohio town. In 1948, a small radio station was established in a nearby community. In an effort to destroy its small competitor, and thereby regain its “pre-1948 substantial monopoly over the mass dissemination of all news and advertising,” the Journal refused to sell advertising to persons that patronized the radio station. Id., at 153.

In holding that this conduct violated §2 of the Sherman Act, the Court dispatched the same argument raised by the monopolist here:

“The publisher claims a right as a private business concern to select its customers and to refuse to accept advertisements from whomever it pleases. We do not dispute that general right. ‘But the word “right” is one of the most deceptive of pitfalls; it is so easy to slip from a qualified meaning in the premise to an unqualified one in the conclusion. Most rights are qualified.’ Ameri can Bank & Trust Co. v. Federal Bank, 256 U. S. 350, 358. The right claimed by the publisher is neither absolute nor exempt from regulation. Its exercise as a purposeful means of monopolizing interstate commerce is prohibited by the Sherman Act. The operator of the radio station, equally with the publisher of the newspaper, is entitled to the protection of that Act. ‘In the absence of any purpose to create or maintain a monopoly, the act does not restrict the long recognized right of trader or manufacturer engaged in an entirely private business, freely to exercise his own independent discretion as to parties with whom he will deal.’ (Emphasis supplied.) United States v. Colgate & Co., 250 U. S. 300, 307. See Associated Press v. United States, 326 U. S. 1, 15; United States v. Bausch & Bomb Co., 321 U. S. 707, 721-723.” 342 U. S., at 155.

The Court approved the entry of an injunction ordering the Journal to print the advertisements of the customers of its small competitor.

In Lorain Journal, the violation of § 2 was an “attempt to monopolize,” rather than monopolization, but the question of intent is relevant to both offenses. In the former case it is necessary to prove a “specific intent” to accomplish the forbidden objective — as Judge Hand explained, “an intent which goes beyond the mere intent to do the act.” United States v. Aluminum Co. of America, 148 F. 2d 416, 432 (CA2 1945). In the latter case evidence of intent is merely relevant to the question whether the challenged conduct is fairly characterized as “exclusionary” or “anticompetitive” — to use the words in the trial court’s instructions — or “predatory,” to use a word that scholars seem to favor. Whichever label is used, there is agreement on the proposition that “no monopolist monopolizes unconscious of what he is doing.” As Judge Bork stated more recently: “Improper exclusion (exclusion not the result of superior efficiency) is always deliberately intended.”

The qualification on the right of a monopolist to deal with whom he pleases is not so narrow that it encompasses no more than the circumstances of Lorain Journal. In the actual case that we must decide, the monopolist did not merely reject a novel offer to participate in a cooperative venture that had been proposed by a competitor. Rather, the monopolist elected to make an important change in a pattern of distribution that had originated in a competitive market and had persisted for several years. The all-Aspen, 6-day ticket with revenues allocated on the basis of usage was first developed when three independent companies operated three different ski mountains in the Aspen area. Supra, at 589, and n. 7. It continued to provide a desirable option for skiers when the market was enlarged to include four mountains, and when the character of the market was changed by Ski Co.’s acquisition of monopoly power. Moreover, since the record discloses that interchangeable tickets are used in other multimountain areas which apparently are competitive, it seems appropriate to infer that such tickets satisfy consumer demand in free competitive markets.

Ski Co.’s decision to terminate the all-Aspen ticket was thus a decision by a monopolist to make an important change in the character of the market. Such a decision is not necessarily anticompetitive, and Ski Co. contends that neither its decision, nor the conduct in which it engaged to implement that decision, can fairly be characterized as exclusionary in this case. It recognizes, however, that as the case is presented to us, we must interpret the entire record in the light most favorable, to Highlands and give to it the benefit of all inferences which the evidence fairly supports, even though contrary inferences might reasonably be drawn. Continental Ore Co. v. Union Carbide & Carbon Corp., 370 U. S. 690; 696 (1962).

Moreover, we must assume that the jury followed the court’s instructions. The jury must, therefore, have drawn a distinction “between practices which tend to exclude or restrict competition on the one hand, and the success of a business which reflects only a superior product, a well-run business, or luck, on the other.” Supra, at 596. Since the jury was unambiguously instructed that Ski Co.’s refusal to deal with Highlands “does not violate Section 2 if valid business reasons exist for that refusal,” supra, at 597, we must assume that the jury concluded that there were no valid business reasons for the refusal. The question then is whether that conclusion finds support in the record.

I — I

The question whether Ski Co.’s conduct may properly be characterized as exclusionary cannot be answered by simply considering its effect on Highlands. In addition, it is relevant to consider its impact on consumers and whether it has impaired competition in an unnecessarily restrictive way. If a firm has been “attempting to exclude rivals on some basis other than efficiency,” it is fair to characterize its behavior as predatory. It is, accordingly, appropriate to examine the effect of the challenged pattern of conduct on consumers, on Ski Co.’s smaller rival, and on Ski Co. itself.

Superior Quality of the All-Aspen Ticket

The average Aspen visitor “is a well-educated, relatively affluent, experienced skier who has skied a number of times in the past. . . .” Tr. 764. Over 80% of the skiers visiting the resort each year have been there before — 40% of these repeat visitors havé skied Aspen at least five times. Id., at 768. Over the years, they developed a strong demand for the 6-day, all-Aspen ticket in its various refinements. Most experienced skiers quite logically prefer to purchase their tickets at once for the whole period that they will spend at the resort; they can then spend more time on the slopes and enjoying aprés-ski amenities and less time standing in ticket lines. The 4-area attribute of the ticket allowed the skier to purchase his 6-day ticket in advance while reserving the right to decide in his own time and for his own reasons which mountain he would ski on each day. It provided convenience and flexibility, and expanded the vistas and the number of challenging runs available to him during the week’s vacation.

While the 3-area, 6-day ticket offered by Ski Co. possessed some of these attributes, the evidence supports a conclusion that consumers were adversely affected by the elimination of the 4-area ticket. In the first place, the actual record of competition between a 3-area ticket and the all-Aspen ticket in the years after 1967 indicated that skiers demonstrably preferred four mountains to three. Supra, at 589-590, 592. Highlands’ expert marketing witness testified that many of the skiers who come to Aspen want to ski the four mountains, and the abolition of the 4-area pass made it more difficult to satisfy that ambition. Tr. 775. A consumer survey undertaken in the 1979-1980 season indicated that 53.7% of the respondents wanted to ski Highlands, but would not; 39.9% said that they would not be skiing at the mountain of their choice because their ticket would not permit it. Record Ex. No. 75, pp. 36-37.

Expert testimony and anecdotal evidence supported these statistical measures of consumer preference. A maj or wholesale tour operator asserted that he would not even consider marketing a 3-area ticket if a 4-area ticket were available. During the 1977-1978 and 1978-1979 seasons, people with Ski Co.’s 3-area ticket came to Highlands “on a very regular basis” and attempted to board the lifts or join the ski school. Highlands officials were left to explain to angry skiers that they could only ski at Highlands or join its ski school by paying for a 1-day lift ticket. Even for the affluent, this was an irritating situation because it left the skier the option of either wasting 1 day of the 6-day, 3-area pass or obtaining a refund which could take all morning and entailed the forfeit of the 6-day discount. An active officer in the Atlanta Ski Club testified that the elimination of the 4-area pass “infuriated” him. Tr. 978.

Highlands’ Ability to Compete

The adverse impact of Ski Co.’s pattern of conduct on Highlands is not disputed in this Court. Expert testimony described the extent of its pecuniary injury. The evidence concerning its attempt to develop a substitute product either by buying Ski Co.’s daily tickets in bulk, or by marketing its own Adventure Pack, demonstrates that it tried to protect itself from the loss of its share of the patrons of the all-Aspen ticket. The development of a new distribution system for providing the experience that skiers had learned to expect in Aspen proved to be prohibitively expensive. As a result, Highlands’ share of the relevant market steadily declined after the 4-area ticket was terminated. The size of the damages award also confirms the substantial character of the effect of Ski Co.’s conduct upon Highlands.

Ski Co.’s Business Justification

Perhaps most significant, however, is the evidence relating to Ski Co. itself, for Ski Co. did not persuade the jury that its conduct was justified by any normal business purpose. Ski Co. was apparently willing to forgo daily ticket sales both to skiers who sought to exchange the coupons contained in Highlands’ Adventure Pack, and to those who would have purchased Ski Co. daily lift tickets from Highlands if Highlands had been permitted to purchase them in bulk. The jury may well have concluded that Ski Co. elected to forgo these short-run benefits because it was more interested in reducing competition in the Aspen market over the long-run by harming its smaller competitor.

That conclusion is strongly supported by Ski Co.’s failure to offer any efficiency justification whatever for its pattern of conduct. In defending the decision to terminate the jointly offered ticket, Ski Co. claimed that usage could not be properly monitored. The evidence, however, established that Ski Co. itself monitored the use of the 3-area passes based on a count taken by lift operators, and distributed the revenues among its mountains on that basis. Ski Co. contended that coupons were administratively cumbersome, and that the survey takers had been disruptive and their work inaccurate. Coupons, however, were no more burdensome than the credit cards accepted at Ski Co. ticket windows. Tr. 330-331. Moreover, in other markets Ski Co. itself participated in interchangeable lift tickets using coupons, n. 30, supra. As for the survey, its own manager testified that the problems were much overemphasized by Ski Co. officials, and were mostly resolved as they arose. Tr. 663-667, 673. Ski Co.’s explanation for the rejection of Highlands’ offer to hire — at its own expense — a reputable national accounting firm to audit usage of the 4-area tickets at Highlands’ mountain, was that there was no way to “control” the audit. Id., at 598.

In the end, Ski Co. was pressed to justify its pattern of conduct on a desire to disassociate itself from — what it considered — the inferior skiing services offered at Highlands. Id., at 401, 422. The all-Aspen ticket based on usage, however, allowed consumers to make their own choice on these matters of quality. Ski Co.’s purported concern for the relative quality of Highlands’ product was supported in the record by little more than vague insinuations, and was sharply contested by numerous witnesses. Moreover, Ski Co. admitted that it was willing to associate with what it considered to be inferior products in other markets. Id., at 964.

Although Ski Co.’s pattern of conduct may not have been as “‘bold, relentless, and predatory’” as the publisher’s actions in Lorain Journal, the record in this case comfortably supports an inference that the monopolist made a deliberate effort to discourage its customers from doing business with its smaller rival. The sale of its 3-area, 6-day ticket, particularly when it was discounted below the daily ticket price, deterred the ticket holders from skiing at Highlands. The refusal to accept the Adventure Pack coupons in exchange for daily tickets was apparently motivated entirely by a decision to avoid providing any benefit to Highlands even though accepting the coupons would have entailed no cost to Ski Co. itself, would have provided it with immediate benefits, and would have satisfied its potential customers. Thus the evidence supports an inference that Ski Co. was not motivated by efficiency concerns and that it was willing to sacrifice short-run benefits and consumer goodwill in exchange for a perceived long-run impact on its smaller rival.

Because we are satisfied that the evidence in the record, construed most favorably in support of Highlands’ position, is adequate to support the verdict under the instructions given by the trial court, the jugment of the Court of Appeals is

Affirmed.

Justice White took no part in the decision of this case.

       The statute provides, in relevant part:
      “Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a felony . . . .” 15 U. S. C. §2.

       Ski Co. developed Ajax in 1946. The runs are quite steep and primarily designed for expert or advanced intermediate skiers. The base area of Ajax is located within the village of Aspen.

       In 1957, the United States Forest Service suggested that Ajax “was getting crowded, and. . . that a ski area ought to be started at Highlands.” Tr. 150. Whipple V. N. Jones, who owned an Aspen lodge at the time, discussed the project with Ski Co. officials, but they expressed little interest, telling him that they had “plenty of problems at Aspen now, and we don’t think we want to expand skiing in Aspen.” Id., at 150-151. Jones went ahead with the project on his own, and laid out a well-balanced set of ski runs: 25% beginner, 50% intermediate, 25% advanced. The base area of Highlands Mountain is located lVz miles from the village of Aspen. Id., at 154. Respondent Aspen Highlands Skiing Corporation provides the downhill skiing services at Highlands Mountain. Throughout this opinion we refer to both the respondent and its mountain as Highlands.

       In 1958, Friedl Pfeiffer and Arthur Pfister began developing the ranches they owned at the base of Buttermilk Mountain into a third ski area. Pfeiffer, a former Olympian, was the director of the ski school for Ski Co., and the runs he laid out were primarily for beginners and intermediate skiers. More advanced runs have since been developed. The base area of Buttermilk is located approximately 27i miles from the village of Aspen. Id., at 152, 1471-1472, 1526; Deposition of Paul Nitze 6-7.

       In the early 1960’s William Janss, a former ski racer, and his associates had acquired three ranches in the Snowmass Valley, and had secured Forest Service permits for a ski area. The developer sold the company holding the permits to Ski Co. to allow it to develop a downhill skiing facility for the project, leaving him to develop the land at the base of the site. A fairly balanced mountain was developed with a mixture of beginner, intermediate, and advanced runs. Id., at 14-16; Tr. 1475-1476. The base area of Snowmass is eight miles from the village of Aspen.

         Id., at 378-379, 638, 2040-2051, 2069-2070, 2078-2082.

       Friedl Pfeiffer, one of the developers of Buttermilk, initiated the idea of an all-Aspen ticket at a luncheon with the owner of Highlands and the President of Ski Co. Pfeiffer, a native of Austria, informed his competitors that “ ‘[i]n St. Anton, we have a mountain that has three different lift companies — lifts owned by three different lift companies. . . . We sell a ticket that is interchangeable.’ It was good on any of those lifts; and he said, ‘I think we should do the same thing here.’” Id., at 153.

         Id., at 167. Highlands’ share of the total market during those seasons, as measured in skier visits was 15.8% in 1973-1974, 17.1% in 1974-1975, 17.4% in 1975-1976, and 20.5% in 1976-1977. Record Ex. No. 97, App. 183.

       In 1975, the Colorado Attorney General filed a complaint against Ski Co. and Highlands alleging, in part, that the negotiations over the 4-area ticket had provided them with a forum for price fixing in violation of § 1 of the Sherman Act and that they had attempted to monopolize the market for downhill skiing services in Aspen in violation of § 2. Record Ex. X. In 1977, the case was settled by a consent decree that permitted the parties to continue to offer the 4-area ticket provided that they set their own ticket prices unilaterally before negotiating its terms. Tr. 229-281.

       About 15-20% of each company’s ticket revenues were derived from sales to tour operators at a wholesale discount of 10-15%, while 80-85% of the ticket revenues were derived from sales to skiers in Aspen. Id., at 623, 1772.

       The 1976-1977 season was “a no snow year.” There were less than half as many skier visits (529,800) in that season as in either 1975-1976 (1,238,500) or 1977-1978 (1,273,400). Record Ex. No. 97, App. 183. In addition, Highlands opened earlier than Ski Co.’s mountains and its patrons skied off all the good snow. Ski Co. waited until January and had a better base for the rest of the season. Tr. 228.

       Ski Co. circulated another advertisement to national magazines labeled “Aspen, More Mountains, More Fun.” App. 184. The advertisement depicted the four mountains of Aspen, but labeled only Ajax, Buttermilk, and Snowmass. Buttermilk’s label is erroneously placed directly over Highlands Mountain. Tr. 860, 1803.

       Highlands’ owner explained that there was a key difference between the 3-day, 3-area ticket and the 6-day, 3-area ticket: “with the three day ticket, a person could ski on the . . . Aspen Skiing Corporation mountains for three days and then there would be three days in which he could ski on our mountain; but with the six-day ticket, we are absolutely locked out of those people.” Id., at 245. As a result of “tremendous consumer demand” for a 3-day ticket, Ski Co. reinstated it late in the 1978-1979 season, but without publicity or a discount off the daily rate. Id., at 622.

       In the 1977-1978 negotiations, Ski Co. previously had refused to consider the sale of any tickets to Highlands, noting that it was “obviously not interested in helping sell” a package competitive with the 3-area ticket. Record Ex. No. 16; Tr. 269-270. Later, in the 1978-1979 negotiations, Ski Co.’s vice president of finance told a Highlands official that “[w]e will not have anything to do with a four-area ticket sponsored by the Aspen Highlands Skiing Corporation.” Id., at 335. When the Highlands official inquired why Ski Co. was taking this position considering that Highlands was willing to pay full retail value for the daily lift tickets, the Ski Co. official answered tersely: “we will not support our competition.” Ibid.

       Of course, there was nothing to identify Highlands as the source of these instruments, unless someone saw the skier “taking it out of an Adventure Pack envelope.” Id., at 505. For the 1981-1982 season, Ski Co. set its single ticket price at $22 and discounted the 3-area, 6-day ticket to $114. According to Highlands, this price structure made the Adventure Pack unprofitable. Id., at 535.

       In these seasons, Buttermilk Mountain, in particular, substantially increased its market share at the expense of Highlands. Record Ex. BB; Tr. 1806.

       See Record Ex. No. 91; Tr. 488, 571-572, 692-694, 698, 701-702. Highlands’ ski school had an outstanding reputation, and its share of the ski school market had always outperformed Highlands’ share of the downhill skiing market. Id., at 1822. Even some Ski Co. officials had sent their children to ski school at Highlands. Id., at 560-570, 588. After the elimination of the 4-area ticket, however, families or groups purchasing 3-area tickets were reluctant to enroll a beginner among them in the Highlands ski school when the more experienced skiers would have to leave to ski at Ajax, Buttermilk, or Snowmass. Id., at 571.

       Highlands also alleged that Ski Co. had conspired with various third parties in violation of § 1 of the Sherman Act. The District Court allowed this claim to go to the jury which rendered a verdict in Ski Co.’s favor. App. 189.

       In United States v. Grinnell Corp., 384 U. S. 563, 570-571 (1966), we explained:
      “The offense of monopoly under § 2 of the Sherman Act has two elements: (1) the possession of monopoly power in the relevant market and (2) the willful acquisition or maintenance of that power as distinguished from growth or development as a consequence of a superior product, business acumen, or historic accident.”

       The jury found that the relevant product market was “[djownhill skiing at destination ski resorts,” that the “Aspen area” was a relevant geographic submarket, and that during the years 1977-1981, Ski Co. possessed monopoly power, defined as the power to control prices in the relevant market or to exclude competitors. See App. 187-188.

       It answered this interrogatory affirmatively:
      “Willful Acquisition, Maintenance or Use of Monopoly Power: Do you find by a preponderance of the evidence that the defendants willfully acquired, maintained or used monopoly power by anticompetitive or exclusionary means or for anticompetitive or exclusionary purposes, rather than primarily as a consequence of a superior product, superior business sense, or historic accident?” Id., at 189.

       Counsel also appears to have argued that Ski Co. was under a legal obligation to refuse to participate in any joint marketing arrangement with Highlands:
      “Aspen Skiing Corporation is required to compete. It is required to make independent decisions. It is required to price its own product. It is required to make its own determination of the ticket that it chooses to offer and the tickets that it chooses not to offer.” Tr. 1454.
      In this Court, Ski Co. does not question the validity of the joint marketing arrangement under § 1 of the Sherman Act. Thus, we have no occasion to consider the circumstances that might permit such combinations in the skiing industry. See generally National Collegiate Athletic Assn. v. Board of Regents of Univ. of Okla., 468 U. S. 85, 113-115 (1984); Broadcast Music, Inc., v. Columbia Broadcasting System, Inc., 441 U. S. 1, 18-23 (1979); Continental T. V., Inc. v. GTE Sylvania, Inc., 433 U. S. 36, 51-57 (1977).

       The District Court also entered an injunction requiring the parties to offer jointly a 4-area, 6-out-of-7-day coupon booklet substantially identical to the “Ski the Summit” booklet accepted by Ski Co. at its Breckenridge resort in Summit County, Colorado. See n. 30, infra. See also supra, at 589. The injunction was initially for a 3-year period, but was later extended through the 1984-1985 season by stipulation of the parties. Highlands represents that “it will not seek an extension of the injunction.” Brief for Respondent 1, n. 1. No question is raised concerning the character of the injunctive relief ordered by the District Court.

       788 F. 2d, at 1516-1517 (quoting Ski Co.’s brief below).

       See Continental Ore Co. v. Union Carbide & Carbon Corp., 370 U. S. 690, 699 (1962); Associated Press v. United States, 326 U. S. 1, 14 (1945).

       Highlands also contends that Ski Co.’s present contentions were not properly raised in the District Court. In that court, Ski Co. primarily questioned whether the evidence supported a finding that it possessed monopoly power in a properly defined market. In this Court, on the other hand, Ski Co.’s entire argument relates to the question whether it misused that power. Nevertheless, we agree with the Court of Appeals’ conclusion, 738 F. 2d, at 1517-1518, that Ski Co.’s motion for a directed verdict did raise the question whether the judgment improperly rested on an assumption that § 2 required a monopolist to cooperate with its rivals.

       Under § 1 of the Sherman Act, a business “generally has a right to deal, or refuse to deal, with whomever it likes, as long as it does so independently.” Monsanto Co. v. Spray-Rite Service Corp., 465 U. S. 752, 761 (1984); United States v. Colgate & Co., 250 U. S. 300, 307 (1919).

       “In order to fall within § 2, the monopolist must have both the power to monopolize, and the intent to monopolize. To read the passage as demanding any ‘specific,’ intent, makes nonsense of it, for no monopolist monopolizes unconscious of what he is doing. So here, ‘Alcoa’ meant to keep, and did keep, that complete and exclusive hold upon the ingot market with which it started. That was to ‘monopolize’ that market, however innocently it otherwise proceeded.” United States v. Aluminum Co. of America, 148 F. 2d, at 432.

       R. Bork, The Antitrust Paradox 160 (1978) (hereinafter Bork).

       Ski Co. itself participates in interchangeable ticket programs in at least two other markets. For example, since 1970, Ski Co. has operated the Breckenridge resort in Summit County, Colorado. Breckenridge participates in the “Ski the Summit” 4-area interchangeable coupon booklet which allows the skier to ski at any of the four mountains in the region: Breckenridge, Copper Mountain, Keystone, and Arapahoe Basin. Tr. 188, 590, 966, 1070-1081. In the 1979-1980 season Keystone and Arapahoe Basin — which are jointly operated — had about 40% of the Summit County market, and the other two ski mountains each had a market share of about 30%. Id., at 1100. During the relevant period of time, Ski Co. also operated Blackcomb Mountain, northeast of Vancouver, British Columbia, which has an interchangeable ticket arrangement with nearby Whistler Mountain, an independently operated facility. Id., at 369, 873-874. Interchangeable lift tickets apparently are also available in some European skiing areas. See n. 7, supra; Tr. 720.

       “In any business, patterns of distribution develop over time; these may reasonably be thought to be more efficient than alternative patterns of distribution that do not develop. The patterns that do develop and persist we may call the optimal patterns. By disturbing optimal distribution patterns one rival can impose costs upon another, that is, force the other to accept higher costs.” Bork 156.
      In § 1 cases where this Court has applied the per se approach to invalidity to concerted refusals to deal, “the boycott often cut off access to a supply, facility or market necessary to enable the boycotted firm to compete, . . . and frequently the boycotting firms possessed a dominant position in the relevant market.” Northwest Wholesale Stationers, Inc. v. Pacific Stationery & Printing Co., ante, at 294.

       «Thus, ‘exclusionary’ comprehends at the most behavior that not only (1) tends to impair the opportunities of rivals, but also (2) either does not further competition on the merits or does so in an unnecessarily restrictive way.” 3 P. Areeda & D. Turner, Antitrust Law 78 (1978).

       Bork 138.

       Highlands’ expert marketing witness testified that visitors to the Aspen resort “are looking for a variety of skiing experiences, partly because they are going to be there for a week and they are going to get bored if they ski in one area for very long; and also they come with people of varying skills. They need some variety of slopes so that if they want to go out and ski the difficult areas, their spouses or their buddies who are just starting out skiing can go on the bunny hill or the not-so-difficult slopes.” Tr. 765. The owner of a condominium management company added: “The guest is coming for a first-class destination ski experience, and part of that, I think, is the expectation of perhaps having available to him the ability to ski all of what is there; i. e., four mountains vs. three mountains. It helps enhance the quality of the vacation experience. ” Id., at 720. See also id., at 685.

       “Our philosophy is that ... to offer [Aspen] as a premier ski resort, our clients should be offered all of the terrain. Therefore, we would never consciously consider offering a three-mountain ticket if there were a four-mountain ticket available.” Id., at 1026.

         Id., at 356, 492, 572, 679, 1001-1002. For example, the marketing director of Highlands’ ski school reported that one frustrated consumer was a dentist from “the Des Moines area [who] came out with two of his children, and he had been told by our base lift operator that he could not board. He became somewhat irate and she had referred him to my office, which is right there on the ski slopes. He came into my office and started out, “Well, I want to go skiing here, and I don’t understand why I can’t.’ When we got the situation slowed down and explained that there were two different tickets, well, what came out is irritation occurred because he had intended when he came to Aspen to be able to ski all areas . . . .” Id., at 356.

       The refund policy was cumbersome, and poorly publicized. Id., at 994, 1044, 1053.

       In considering the competitive effect of Ski Co.’s refusal to deal or cooperate with Highlands, it is not irrelevant to note that similar conduct carried out by the concerted action of three independent rivals with a similar share of the market would constitute a per se violation of § 1 of the Sherman Act. See Northwest Wholesale Stationers, Inc. v. Pacific Stationery & Printing Co., ante, at 294. Cf. Lorain Journal Co. v. United States, 342 U. S. 143, 154 (1951).

       "The law can usefully attack this form of predation only when there is evidence of specific intent to drive others from the market by means other than superior efficiency and when the predator has overwhelming market size, perhaps 80 or 90 percent. Proof of specific intent to engage in predation may be in the form of statements made by the officers or agents of the company, evidence that the conduct was used threateningly and did not continue when a rival capitulated, or evidence that the conduct was not related to any apparent efficiency. These matters are not so difficult of proof as to render the test overly hard to meet.” Bork 157 (emphasis added).

       Under the Ski Co. system, each skier’s ticket, whether a daily or weekly ticket, is punched before he goes out on the slopes for the day. Revenues are distributed between the mountains on the basis of this count. Tr. 650-651. Ski Co.’s vice president for finance testified that Ski Co. “would never consider” a system like that for monitoring usage on a 4-area ticket: “it’s fine to approximate within your own company.” Id., at 599. The United States Forest Service, however, required the submission of financial information on a mountain-by-mountain basis as a condition of the permits issued for each mountain. Id., at 643,945. A lift operator at Ajax conceded that the survey count during the years of the 4-area ticket was “generally pretty close” to the count made by Ski Co.’s staff. Id., at 1627.

         Lorain Journal Co. v. United States, 342 U. S., at 149 (quoting opinion below, 92 F. Supp. 794, 796 (ND Ohio 1950)).

       “[w]hy didn’t they buy an individual daily lift ticket at Aspen Highlands? . . . For those who had bought six-day tickets, I think despite the fact that they are all relatively affluent — a lot of them are relatively affluent when they go to Aspen — they are all sort of managerial types and they seem to be pretty cautious. Certainly the comments that I have had from individual skiers and from the tour operators, club people that I have talked to — they are pretty careful with their money and they would feel— these are the people who will buy the six-day, three-area ticket that giving up one of those days and going over to ski at Aspen Highlands would mean spending extra money.” Tr. 777.

       The Ski Co. advertising that conveyed the impression that there were only three skiing mountains in Aspen, supra, at 593, and n. 12, is consistent with this conclusion, even though this evidence would not be sufficient in itself to sustain the judgment.

       Given our conclusion that the evidence amply supports the verdict under the instructions as given by the trial court, we find it unnecessary to consider the possible relevance of the “essential facilities” doctrine, or the somewhat hypothetical question whether nonexclusionary conduct could ever constitute an abuse of monopoly power if motivated by an anticompet-itive purpose. If, as we have assumed, no monopolist monopolizes unconscious of what he is doing, that case is unlikely to arise.


author: Chief Justice Burger Justice Brennan, Justice Stevens,

text:
    HOOPER et al. v. BERNALILLO COUNTY ASSESSOR
    No. 84-231.
    Argued February 20, 1985
    Decided June 24, 1985

      Burger, C. J., delivered the opinion of the Court, in which Brennan, White, Marshall, and Blackmun, JJ., joined. Brennan, J., filed a concurring opinion, post, p. 624. Stevens, J., filed a dissenting opinion, in which Rehnquist and O’Connor, JJ., joined, post, p. 624. Powell, J., took no part in the decision of the case.

      Alvin D. Hooper, pro se, argued the cause for appellants. With him on the briefs was Harold L. Folley.

      H. Bartow Farr III argued the cause for appellee. With him on the brief was Kenneth Hunt.

         David Greer filed a brief for the American Legion et al. as amici curiae urging affirmance.

        Paul Bardacke, Attorney General, and Bridget A. Jacober, Special Assistant Attorney General, filed a brief for the State of New Mexico as amicus curiae.

   Chief Justice Burger

delivered the opinion of the Court.

We noted probable jurisdiction to decide whether a New Mexico statute that grants a tax exemption limited to those Vietnam veterans who resided in the State before May 8, 1976, violates the Equal Protection Clause of the Fourteenth Amendment.

I

Pursuant to Art. VIII, § 5, of the New Mexico Constitution, the New Mexico State Legislature has granted annual property tax exemptions to residents who served in the Armed Forces. As applied to Vietnam veterans currently residing in New Mexico, § 7-37-5 of the New Mexico Statutes exempts $2,000 of the taxable value of property for any honorably discharged Vietnam veteran who served on active duty during the Vietnam War for at least 90 continuous days, N. M. Stat. Ann. §§7-37-5(0(1) and (2) (1983), and who was a New Mexico resident before May 8, 1976, § 7-37-5(C)(3)(d).

Appellants, Alvin D. Hooper and his wife Mary, established residence in New Mexico on August 17, 1981. During the Vietnam War, Alvin Hooper had served for over 90 continuous days as a member of the United States Army; Hooper was honorably discharged in September 1965. For the 1983 tax year, the Hoopers applied for the $2,000 veterans’ tax exemption with respect to their jointly held real property in Bernalillo County. Appellee, the Bernalillo County Assessor, denied the claim because Hooper had not been a state resident before May 8, 1975.

Appellants challenged § 7-37-5(C)(3)(d) as violative of their right to equal protection of the law and their constitutional right to migrate to New Mexico. After a hearing, the Ber-nalillo County Valuation Board rejected appellants’ constitutional challenge and upheld the Assessor’s denial of the tax exemption.

The New Mexico Court of Appeals affirmed. 101 N. M. 172, 679 P. 2d 840, cert. denied, 101 N. M. 77, 678 P. 2d 705 (1984). The court, noting that the statute did not affect “such fundamental interests as voting, welfare benefits, or public medical assistance,” concluded that the statute did not unconstitutionally burden an exercise of the right to travel. Id., at 175, 679 P. 2d, at 843. The court held that the statute was consistent with the Equal Protection Clause because it “reflects legitimate state purposes” and “bears a reasonable relationship to those purposes.” Ibid. The court reasoned that “[a] state’s interest in expressing gratitude and rewarding its pwn citizens for honorable military service is a rational basis for veterans’ preferences,” and that the state legislature is “entitled to limit the period of time within which [veterans] may choose to establish residency.” Id., at 176, 679 P. 2d at 844.

We noted probable jurisdiction. 469 U. S. 878 (1984). We reverse.

II

The New Mexico veterans’ tax exemption differs from the durational residence requirements the Court examined in Sosna v. Iowa, 419 U. S. 393 (1975); Memorial Hospital v. Maricopa County, 415 U. S. 250 (1974); Dunn v. Blumstein, 405 U. S. 330 (1972); and Shapiro v. Thompson, 394 U. S. 618 (1969). The statutes at issue in those cases conditioned eligibility for certain benefits, otherwise available on an equal basis to all residents, on a new resident’s living in the State for a fixed minimum period. The durational ^residence requirements purported to assure that only persons who had established bona fide residence received the benefits provided residents of the States.

The New Mexico statute does not impose any threshold waiting period on those resident veterans seeking the tax exemption; resident veterans are entitled to the exemption provided they satisfy the statute’s other criteria. Nor does the statute purport to establish a test of the bona fides of state residence. Instead, the tax exemption contains a fixed-date residence requirement. The statute thus divides resident Vietnam veterans into two groups: resident veterans who resided in the State before May 8, 1976, qualify for the exemption; resident veterans who established residence after that date do not. Like the Alaska dividend distribution law examined in Zobel v. Williams, 457 U. S. 55 (1982), the tax exemption statute thus creates “fixed, permanent distinctions between . . . classes of concededly bona fide residents” based on when they arrived in the State. Id., at 59.

Appellants established residence in New Mexico several months after the 1981 amendment set the eligibility date as May 8, 1975. Appellants have no quarrel with the legislature’s changing the eligibility date after veterans have chosen to reside in New Mexico, for the enactment date is irrelevant to qualification for the tax exemption. Appellants instead challenge the distinction made by the State within the class of Vietnam veterans who currently are bona fide residents. Their challenge is that the exemption is accorded to those resident Vietnam veterans who resided in the State sometime before May 8, 1976, but not to those Vietnam veterans who have arrived since then.

When a state distributes benefits unequally, the distinctions it makes are subject to scrutiny under the Equal Protection Clause of the Fourteenth Amendment. Generally, a law will survive that scrutiny if the distinction rationally furthers a legitimate state purpose. Appellants claim that the distinction made by the New Mexico statute should be subjected to the higher level of scrutiny applied to the durational residence requirements in Memorial Hospital v. Maricopa County, supra, and Shapiro v. Thompson, supra. Alternatively, appellants claim that the statute cannot withstand the minimum rationality inquiry applied to the Alaska dividend distribution law in Zobel v. Williams, supra. Ap-pellee, on the other hand, asserts that the statute need only satisfy the latter standard of review. As in Zobel, if the statutory scheme cannot pass even the minimum rationality test, our inquiry ends.

Ill

The New Mexico Court of Appeals accepted two justifications for the distinction made by the Vietnam veterans’ tax exemption statute: the exemption encourages veterans to settle in the State and it serves as an expression of the State’s appreciation to its “own citizens for honorable military service.” 101 N. M., at 176, 679 P. 2d, at 844. Before this Court, the latter purpose has been refined as assisting “veterans who, as [New Mexico] citizens, were dependent on [the State] during a time of upheaval in their lives.” Brief for Appellee 22. This rationale assumes that the State accepted a special responsibility toward those veterans who “picked up or laid down the burdens of war” as state residents.

A

The distinction New Mexico makes between veterans who established residence before May 8, 1976, and those veterans who arrived in the State thereafter bears no rational relationship to one of the State’s objectives — encouraging Vietnam veterans to move to New Mexico. The legislature set this eligibility date long after the triggering event occurred. See n. 2, supra. The legislature cannot plausibly encourage veterans to move to the State by passing such retroactive legislation. It is possible that some Vietnam veterans, at least since 1981, might have been discouraged from settling in New Mexico given the State’s exclusion of new resident veterans from a benefit available only to those veterans who resided in the State before May 8, 1976. “The separation of residents into classes hardly seems a likely way to persuade new [residents] that the State welcomes them and wants them to stay.” Zobel v. Williams, 457 U. S., at 62, n. 9.

B

The second purpose of the statute — rewarding veterans who resided in the State before May 8, 1976, for their military service — was primarily relied upon by the New Mexico Court of Appeals to support the statute’s distinction between resident veterans. One component of this rationale is, of course, plainly legitimate; only recently we observed that “[o]ur country has a longstanding policy of compensating veterans for their past contributions by providing them with numerous advantages.” Regan v. Taxation With Representation of Wash., 461 U. S. 540, 551 (1983) (footnote omitted); see Personnel Administrator of Mass. v. Feeney, 442 U. S. 256, 279, n. 25 (1979). And as Judge Friendly has noted, the various preferences for veterans are grounded in a “[djesire to compensate in some measure for the disruption of a way of life . . . and to express gratitude . . . .” Russell v. Hodges, 470 F. 2d 212, 218 (CA2 1972). See Regan v. Taxation With Representation of Wash., supra, at 551.

Consistent with this policy, the State may award certain benefits to all its bona fide veterans, because it then is making neither an invidious nor irrational distinction among its residents. Resident veterans, as a group, may well deserve preferential treatment, and such differential treatment visa-vis non-veterans does not offend the Equal Protection Clause. See, e. g., Personnel Administrator of Mass. v. Feeney, supra; see also Johnson v. Robison, 415 U. S. 361 (1974).

The New Mexico statute, however, does not simply distinguish between resident veterans and non-veteran residents; it confers a benefit only on “established” resident veterans, i. e., those who resided in the State before May 8,1976. Ap-pellee and the State justify this distinction on the basis that those veterans who left their homes in New Mexico to fight in Vietnam, as well as those who settled in the State within the few years after thé war ended, deserve to be treated differently from veterans who make New Mexico their home after May 8, 1976. The legislature is said to have decided it owed a special responsibility to these “established” veterans.

Appellee and the State’s evaluation of this legislative judgment may be questioned on its own terms. Those who serve in the military during wartime inevitably have their lives disrupted; but it is difficult to grasp how New Mexico residents serving in the military suffered more than residents of other States who served, so that the latter would not deserve the benefits a State bestows for national military service. Moreover, the legislature provided this economic boon years after the dislocation occurred. Established state residents, by this time, presumably had become resettled in the community and the modest tax exemption hardly bears directly on the transition to civilian life long after the war’s end. Finally, the benefit of the tax exemption continues for the recipient’s life. The annual exemption, which will benefit this limited group of resident veterans long after the wartime disruption dissipated, is a continuing bounty for one group of residents rather than simply an attempt to ease the veteran’s return to civilian life.

Even assuming that the State may legitimately grant benefits on the basis of a coincidence between military service and past residence, the New Mexico statute’s distinction between resident veterans is not rationally related to the State’s asserted legislative goal. The statute is not written to require any connection between the veteran’s prior residence and military service. Indeed, the veteran who resided in New Mexico as an infant long ago would immediately qualify for the exemption upon settling in the State at any time in the future regardless of where he resided before, during, or after military service.

C

Stripped of its asserted justifications, the New Mexico statute suffers from the same constitutional flaw as the Alaska statute in Zobel. The New Mexico statute, by singling out previous residents for the tax exemption, rewards only those citizens for their “past contributions” toward our Nation’s military effort in Vietnam. Zobel teaches that such an objective is “not a legitimate state purpose.” 457 U. S., at 63. The State may not favor established residents over new residents based on the view that the State may take care of “its own,” if such is defined by prior residence. Newcomers, by establishing bona fide residence in the State, become the State’s “own” and may not be discriminated against solely on the basis of their arrival in the State after May 8, 1976. See, e. g., Vlandis v. Kline, 412 U. S. 441, 449-450, and n. 6 (1973); Shapiro v. Thompson, 394 U. S., at 632-633; Passenger Cases, 7 How. 283, 492 (1849) (Taney, C. J., dissenting).

The New Mexico statute creates two tiers of resident Vietnam veterans, identifying resident veterans who settled in the State after May 8, 1976, as in a sense “second-class citizens.” This discrimination on the basis of residence is not supported by any identifiable state interest; the statute is not written to benefit only those residents who suffered dislocation within the State’s borders by reason of military service. Zobel made clear that the Constitution will not tolerate a state benefit program that “creates fixed, permanent distinctions . . . between . . . classes of concededly bona fide residents, based on how long they have been in the State.” 457 U. S., at 59. Neither the Equal Protection Clause, nor this Court’s precedents, permit the State to prefer established resident veterans over newcomers in the retroactive apportionment of an economic benefit.

D

We decline appellants’ request to rule on the severability of the unconstitutional aspect of the New Mexico veterans’ tax exemption statute. If the fixed-date residence requirement, § 7-37-5(C)(3)(d), were excised from the statute, the exemption would be available to all current resident veterans who served the requisite 90 days during the Vietnam War and received honorable discharges. It is for the New Mexico courts to decide, as a matter of state law, whether the state legislature would have enacted the statute without the invalid portion. See, e. g., Zobel v. Williams, supra, at 64-65; Champlin Refining Co. v. Corporation Comm’n of Oklahoma, 286 U. S, 210, 234 (1932); State v. Spearman, 84 N. M. 366, 368, 503 P. 2d 649, 651 (App. 1972).

IV

We hold that the New Mexico veterans’ tax exemption statute violates ’the guarantees of the Equal Protection Clause of the Fourteenth Amendment. Accordingly, the judgment of the New Mexico Court of Appeals is reversed, and the case is remanded for proceedings not inconsistent with this opinion.

Reversed and remanded.

Justice Powell took no part in the decision of the case.

Justice Brennan,

concurring.

I join the Court’s opinion for the reasons stated therein and in my concurring opinion in Zobel v. Williams, 457 U. S. 55, 65 (1982).

Justice Stevens,

with whom Justice Rehnquist and Justice O’Connor join,

dissenting.

Vietnam veterans are, of course, a distinct minority of the population of New Mexico. The majority has decided to provide them with a special benefit that is not available to the average citizen. In my opinion, there can be no question about the constitutionality of that decision, and I believe it is equally clear that there is nothing invidious in the way the State has defined the class of veterans eligible for the benefit. The validity of the classification is unaffected by the form of the benefit or the date of enactment of the statute. It does not violate the Equal Protection Clause of the Fourteenth Amendment.

I

The New Mexico legislation that is challenged in this case provides a $2,000 property tax exemption to Vietnam veterans (or their unmarried surviving spouses) if the veteran was, among other requirements, a New Mexico resident prior, to May 8, 1976. N. M. Stat. Ann. §7-37^5(0 (1983). This 'legislation is consistent wdth the Equal Protection Clause if “the distinction it makes rationally furthers a legitimate state purpose.” Zobel v. Williams, 457 U. S. 55, 60 (1982).

Arguably, this statute raises two questions under the Equal Protection Clause: (1) is there a rational justification for treating the eligible veterans more favorably than the average citizen; and (2) if so, is there any rational justification for not offering the benefit to all veterans who then lived, or might thereafter live, in New Mexico?

The justification for providing a special benefit for veterans, as opposed to nonveterans, has been recognized throughout the history of our country. It merits restatement. First, the simple interest in expressing the majority’s gratitude for services that often entail hardship, hazard, and separation from family and friends, and that may be vital to the continued security of our Nation, is itself an adequate justification for providing veterans with a tangible token of appreciation. Second, recognition of the fact that military service typically disrupts the normal progress of civilian employment justifies additional tangible benefits — employment preferences, educational opportunities, subsidized loans, tax exemptions, or cash bonuses — to help overcome the adverse consequences of service and to facilitate the reentry into civilian society. A policy of providing special benefits for veterans’ past contributions has “always been deemed to be legitimate.”

The historic justification would support a state decision to provide a benefit for all Vietnam veterans. This case, however, involves a challenge to a decision to provide a benefit for some, but not all, veterans residing in New Mexico. What is the justification for placing any limit on the class of eligible veterans? The most obvious answer is that the State’s resources are not infinite. The need to budget for the future is itself a valid reason for concluding that a limit should be placed on the size of the class of potential beneficiaries. And surely that limit may be defined in a way that is intended to direct finite state resources to those who may have a special need.

In this case, New Mexico’s legislation reflects, not only an expression of gratitude, but also an attempt to ameliorate the hardship Vietnam veterans experienced upon seeking to integrate or reintegrate themselves into New Mexican society. The transition from military to civilian life has always been a difficult one. That transition is furthered by a state decision to provide a benefit for those veterans who once had roots in the State and had returned, or decided to settle in the State, after their military service ended. New Mexico’s modest monetary benefit can be reasonably understood as both a tangible and symbolic “welcome home” to veterans returning to New Mexico from the Far East as well as to those deciding to establish their domiciles in the State for the first time. The legislation simply reflects and recognizes the State’s felt obligation to facilitate the difficult transition of veterans from the battlefields of Asia to civilian life in New Mexico.

Of course, the legislature might have crafted a more elaborate set of eligibility criteria, but since exclusion from the favored class merely places the ineligible veteran in the same class as the majority of the citizenry, there is no constitutional objection to the use of a simple, easily administered standard. The statutory requirement of residence before May 8,1976, is not a perfect proxy for identifying those Vietnam veterans seeking admission or readmission into New Mexican society, but “rational distinctions may be made with substantially less than mathematical exactitude.” New Orleans v. Dukes, 427 U. S. 297, 303 (1976).

HH HH

In my opinion, the validity of the State’s classification is not undermined by the fact that it takes the form of a modest annual tax exemption instead of a cash payment or gold medal. It is true that the continuing character of the exemption differentiates the eligible veteran from the rest of the citizenry over an extended period of time, but I fail to see how that fact bears on the rationality of the classification. If New Mexico had awarded gold medallions to all of its resident veterans on May 1, 1976, I believe it would be absurd for a veteran arriving in the State in 1981 to claim that he or she had a constitutional right either to a comparable medal or to have all other medal recipients return them to the State.

In like manner, New Mexico by this legislation has provided, in effect, a modest annuity for veterans who own real property. Again, it is surely rational'for the State to provide this form of assistance rather than a lump-sum cash bonus. To begin with, a one-time cash bonus would concentrate the fiscal burden of the veterans benefit in one budget year, perhaps preventing New Mexico from awarding any meaningful veterans benefit at all. Rather than providing a trivial token of esteem, the State may have decided to provide an annual and therefore recurring benefit which would, over time, amount to a more significant recognition of service to. returning veterans. The perennial character of its tax exemption may have been especially important in the minds of New Mexico’s legislators if their objective was to provide a symbolic expression of New Mexico’s invitation to rejoin the community on a long-term basis: The recurring form of the benefit provided symbolic reassurance of state support year after year. In so doing, the State might sensibly have expected to instill in returning Vietnam veterans a sense of security and peace of mind after the tumult of that conflict.

For these reasons, New Mexico’s statute is not at all like the Alaska dividend program struck down in Zobel v. Williams, 457 U. S. 55 (1982). The dividend program involved in Zobel created “an ever-increasing number of perpetual classes of concededly bona fide residents, based on how long they have been in the State.” Id., at 59. Every recent arrival was treated less favorably than those who had arrived earlier. The vast majority of dividend recipients were thus treated more favorably than the newly arrived minority. In this case, in contrast, the alleged victim of the discrimination is being treated exactly like the vast majority of New Mexico’s residents. In Zobel, the program had no rational justification other than a purpose to allocate a cash surplus among the majority of the citizenry on the basis of the duration of their residence in the State. In this case, the duration of the veteran’s residence is irrelevant and the distribution to the members of the favored class is supported by a legitimate state interest. There is a world of difference between a decision to provide benefits to some, but not all, veterans and a decision to divide the entire population into a multitude of classes differentiated only by length of residence. The State’s refusal to provide appellant with a veteran’s benefit has not branded him with any badge of inferiority. He has not been treated as a “second class citizen” in any sense. Rather, he has merely received precisely the same treatment as the vast majority of the residents of New Mexico.

f — I HH HH

The Court finds constitutionally significant the fact that the May 8, 1976, cut-off date was not enacted until 1983, and in its understanding of the application of the statute to a veteran who had merely resided in New Mexico as an infant. See ante, at 622. Neither point is valid.

Tellingly, the initial version of New Mexico’s property tax exemption for Vietnam-era veterans — which was enacted in 1973 — had an effective date of January 1, 1975. Even if the Court’s concern with “retroactive apportionment of an economic benefit,” ante, at 623, were valid — and the constitutional defect in retroactivity is never explained — the originating legislation simply was not retroactive. Thus, the Court’s point at best is limited to the state legislature’s decision on two subsequent occasions to liberalize the statutory requirements by extending the cut-off date for eligibility. But the Court does not — and cannot — explain why New Mexico’s belated recognition that its veterans’ assistance program was incomplete renders it ipso facto unconstitutional.

Even if New Mexico’s action were wholly retroactive I would find no constitutional defect. The New Mexico Legislature could reasonably conclude that for many Vietnam veterans the transition from military service to civilian life in New Mexico was still incomplete. New Mexico could further reasonably conclude that some assistance, at once tangible and symbolic, was required to complete the task. I do not think it unconstitutional for New Mexico to presume that Vietnam veterans who arrived in that State more than a year after the end of the Vietnam epoch had successfully readjusted to civilian life in a sister State prior to migrating to New Mexico. Under this view, appellant simply was not in New Mexico when the conditions justifying the assistance were deemed to exist. The late-arriving Vietnam veteran is treated as well as the overwhelming majority of immigrants to the State; until today’s decision, I would not have thought that the Constitution required New Mexico to do more.

In an attempt to highlight the asserted irrationality of the New Mexico statute, the Court asserts that an unquantifiable few late-in-coming Vietnam veterans might qualify for the property tax exemption:

“[T]he veteran who resided in New Mexico as an infant long ago would immediately qualify for the exemption upon settling in the State at any time in the future regardless of where he resided before, during, or after military service.” Ante, at 622.

The New Mexico Court of Appeals, however, did not adopt this construction of the statute: it did not reach this state-law question because appellant did not have standing to raise it. There is thus nothing in the record to support the Court’s assumption that if a veteran who resided in New Mexico as an infant should now return to the State, he or she would qualify for the tax exemption. It hardly befits a federal court that is committed to a policy of avoiding constitutional questions whenever possible to volunteer an unnecessary interpretation of a state statute in order to create a constitutional infirmity. But there is a more fundamental defect in the Court’s argument — indeed, in its entire analysis.

Even if there are a few isolated cases in which the general classification produces an arbitrary result, that is surely not a sufficient reason for concluding that the entire statute is unconstitutional:

"The mere fact that an otherwise valid general classification appears arbitrary in an isolated case is not a sufficient reason for invalidating the entire rule. Nor, indeed, is it a sufficient reason for concluding that the application of a valid rule in a hard case constitutes a violation of equal protection principles. We cannot test the conformance of rules to the principle of equality simply by reference to exceptional cases.” Caban v. Mohammed, 441 U. S. 380, 411-412 (1979) (Stevens, J., dissenting) (footnotes omitted).

See also Vance v. Bradley, 440 U. S. 93, 108 (1979); Califano v. Jobst, 434 U. S. 47, 56-58 (1977); Dandridge v. Williams, 397 U. S. 471, 485 (1970).

New Mexico has elected to express its gratitude to the veterans of the Vietnam conflict by providing a modest tax exemption for those who resided in the State before May 8, 1976. Those veterans who arrived thereafter are treated exactly like the nonveterans who constitute the majority of the State’s population. In my opinion, there is no substance to the claim that this classification violates the principle of equality embodied in the Equal Protection Clause of the Fourteenth Amendment to the Constitution.

Accordingly, I respectfully dissent.

       Section 7-37-5 also provides the $2,000 property tax exemption, under substantially similar conditions, to certain resident veterans of World War I, World War II, and the Korean War. The one variable is the eligibility date: World War I veterans must have been residents of New Mexico before January 1, 1984; World War II veterans must have been residents before January 1, 1947; and Korean War veterans must have been residents before February 1, 1966. N. M. Stat. Ann. §§ 7-37-5(C)(3)(a), (b), and (c) (1983).

       The initial statute extending an exemption to Vietnam veterans required that the veteran have been a New Mexico resident before “entering the armed services from New Mexico” and also that the veteran have been “awarded a Vietnam campaign medal for services in Vietnam” during a prescribed period. 1973 N. M. Laws, Ch. 258, p. 1052. In 1975, the state legislature eliminated the medal requirement but retained the condition that the veteran have entered the Armed Forces from the State. 1975 N. M. Laws, Ch. 3, p. 11.
      In 1981, the legislature dropped the requirement that the veteran have entered the military from New Mexico. The new statute extended the tax exemption to any Vietnam veteran who “was a New Mexico resident prior to . . . May 8, 1975.” 1981 N. M. Laws, Ch. 187, p. 1078. In 1988, the statute was amended to provide the exemption to any Vietnam veteran “who was a New Mexico resident prior to . . . May 8, 1976.” 1988 N. M. Laws, Ch. 330, p. 2112.

       The state legislature changed the eligibility date to May 8, 1976, after appellants had commenced administrative proceedings to challenge the denial of the exemption. The Board’s decision relied on the amended 1976 date. Before the New Mexico Court of Appeals, appellee conceded that this date was inapplicable to the 1983 tax year because the legislature intended that it apply starting with the 1984 tax year. Accordingly, appellants’ claimed exemption should have been denied on the basis of the 1975 eligibility date. Presumably because this discrepancy had no bearing on the constitutional issue, the Court of Appeals did not mention this point. For the sake of clarity, we analyze the statute using the 1976 eligibility date.

       In the durational residence cases, the Court reviewed state laws which established waiting periods on access to divorce courts, Sosna v. Iowa; eligibility for free nonemergency medical care, Memorial Hospital v. Maricopa County; qualification for voting rights, Dunn v. Blumstein; and receipt of welfare assistance, Shapiro v. Thompson.

       This eligibility date has a curious background, which is not explained simply as “one year [after] the final U. S. troop withdrawal [from Vietnam].” 101 N. M. 172,176, 679 P. 2d 840, 844, cert. denied, 101N. M. 77, 678 P. 2d 705 (1984). On January 27, 1973, the United States and other participants in the conflict signed the Vietnam cease-fire agreement in Paris, France. Agreement on Ending the War and Restoring Peace in Viet-Nam, Jan. 27, 1973, [1973] 24 U. S. T. 1, T. I. A. S. No. 7542. The last American troops were withdrawn from Vietnam on March 29, 1973.
      By Proclamation, President Ford designated May 7,1975, as the last day of the “Vietnam era.” Proclamation No. 4373, 3A CFR 48 (1976). The Federal Government uses this date to determine eligibility for veterans’ benefits for those persons who served in the Armed Forces during the Vietnam War. See 38 U. S. C. § 101(29), which defines the “Vietnam era” as that period beginning August 5,1964, and ending May 7,1975. In 1981, the New Mexico State Legislature adopted this date to determine eligibility for the Vietnam veterans’ tax exemption. In 1983, the state legislature changed the date to May 8, 1976, presumably to extend a “grace period” to veterans choosing to reside in New Mexico. See n. 2, supra.

       The New Mexico Court of Appeals considered whether the veterans’ tax exemption law violated appellants’ constitutional right to travel. Despite disagreement over its source in the Constitution, compare Zobel v. Williams, 457 U. S. 55, 65 (1982) (Brennan, J., concurring), with id., at 71 (O’Connor, J., concurring in judgment), the Court has long held that the right to travel, “when applied to residency requirements, protects new residents of a State from being disadvantaged because of their recent migration or from otherwise being treated differently from longer term residents.” Id., at 60, n. 6; see, e. g., Memorial Hospital v. Maricopa County, 415 U. S. 250, 261 (1974); Shapiro v. Thompson, 394 U. S. 618, 629-631 (1969).
      As we noted in Zobel, “Might to travel cases have examined, in equal protection terms, state distinctions between newcomers and longer term residents.” 457 U. S., at 60, n. 6. This case involves a distinction between residents based on when they first established residence in the State. Following Zobel, we subject this case to equal protection analysis.

       The State of New Mexico, as amicus curiae, observes that the statute’s purpose “is to reward persons who served in periods of armed conflict as residents of New Mexico or who established residency in New Mexico shortly thereafter.” Brief for State of New Mexico as Amicus Curiae 5.

       Although neither appellee nor the State of New Mexico presses the point, the statute could conceivably influence certain veterans, having already moved to New Mexico, to remain there so as to secure the tax benefit. Similarly, the statute could plausibly encourage certain veterans, who had once resided in New Mexico prior to May 8,1976, to return to the State. This selective incentive, however, would encounter the same constitutional barrier faced by the statute’s distinction between past and newly arrived residents. See infra.

       A state objective to inhibit migration into the State would encounter “insurmountable constitutional difficulties.” Zobel, supra, at 62, n. 9. See Shapiro v. Thompson, supra, at 629.

       For a compilation of the variety of state veterans’ preference statutes, see House Committee on Veterans’ Affairs, State Veterans’ Laws, 98th Cong., 2d Sess., 1-306 (Comm. Print No. 47, 1984).

       Veterans’ benefit statutes, which condition eligibility on state residence at the time of induction into the military, have survived challenges under the Equal Protection Clause before Zobel was decided. See, e. g., Langston v. Levitt, 425 F. Supp. 642 (SDNY 1977); August v. Bronstein,
        369 F. Supp. 190 (SDNY), summarily aff’d, 417 U. S. 901 (1974); Leech v. Veterans’ Bonus Division Appeals, 179 Conn. 311, 426 A. 2d 289 (1979).
      The Court’s summary affirmance in August v. Bronstein may not be read as an adoption of the reasoning of the judgment under review. Zobel v. Williams, 457 U. S., at 64, n. 13; Fusari v. Steinberg, 419 U. S. 379, 391 (1975) (concurring opinion). Indeed, the Second Circuit recently has ruled that such a statute could not pass muster under the Equal Protection Clause in light of the Court’s holding in Zobel. Soto-Lopez v. New York City Civil Service Comm’n, 755 F. 2d 266 (1985), appeal docketed, No. 84-1803. Given the circumstances presented in this ease, we need not consider here the constitutionality of these statutes.

       Compare the New Mexico open-ended prior-residence requirement with the specific criteria of Ill. Rev. Stat. Ch. 12672, ¶ 57.52 (1983); Ky. Rev. Stat. §40.005 (1980); and Pa. Stat. Ann., Tit. 51, §§20122, 20123 (1976 and Supp. 1984-1985) (Purdon).
      We also note that the New Mexico statute differs from the local “bounty” laws enacted during the Civil War era, through which States paid residents cash bonuses for enlisting. See generally E. Murdock, Patriotism Unlimited, 1862-1865, pp. 16-41 (1967).

       In Zobel v. Williams, the Court held that an Alaska statute that used length of state residence to calculate distribution of dividends from the State’s oil reserves violated the Equal Protection Clause. We made clear that the statute’s only conceivable purpose — “to reward citizens for past contributions” — is “not a legitimate state purpose.” 457 U. S., at 63; see id., at 68 (Brennan, J., concurring).

       Concurring in Zobel, Justice Brennan noted that the Citizenship Clause of the Fourteenth Amendment “does not provide for, and does not allow for, degrees of citizenship based on length of residenee. And the Equal Protection Clause would not tolerate such distinctions.” Id., at 69 (footnote omitted).

       Approximately 55,000 Vietnam veterans reside in New Mexico. U. S. Dept, of Commerce, Bureau of the Census, Statistical Abstract of the United States 1985, p. 346 (105th ed. 1984) (estimate as of 1983), accounting for little more than 3.9% of the population. See id., at 11. Veterans as a whole comprise less than 11.6% of New Mexico’s residents. See id., at 11, 346.

       The legislation is the product of four separate enactments. See ante, at 614-615, n. 2. In 1973, the New Mexico Legislature decided to grant a $2,000 property tax exemption to Vietnam veterans who had entered the Armed Forces from New Mexico and had been awarded a campaign medal for service in Vietnam. 1973 N. M. Laws, ch. 258, p. 1052. On three occasions after the original benefit was authorized, the New Mexico Legislature decided to enlarge the class of eligible beneficiaries. In 1975, it eliminated the requirement of a campaign medal 'for service in Vietnam, 1975 N. M. Laws, ch. 3, p. 11, and in 1981, it eliminated the requirement of residence at the time of enlistment and substituted a requirement of residence prior to May 8,1975,1981N. M. Laws, ch. 187, p. 1078, the last day of the “Vietnam era” as proclaimed by President Ford. Presidential Proclamation No. 4373, 3A CFR 48 (1975). In 1983, it extended eligibility to veterans who had been residents before May 8, 1976. 1983 N. M. Laws, eh. 330, p. 2112.

       “Veterans have ‘been obliged to drop their own affairs to take up the burdens of the nation,’ Boone v. Lightner, 319 U. S. 561, 575 (1943), ‘ “subjecting themselves to the mental and physical hazards as well as the economic and family detriments which are peculiar to military service and which do not exist in normal civil life.” ’ Johnson v. Robison, 415 U. S. 361, 380 (1974) (emphasis deleted). Our country has a longstanding policy of compensating veterans for their past contributions by providing them with numerous advantages. This policy has ‘always been deemed to be legitimate.’ Personnel Administrator of Mass. v. Feeney, 442 U. S. 256, 279, n. 25 (1979).” Regan v. Taxation with Representation of Wash., 461 U. S. 540, 550-551 (1983) (footnote omitted).

       Although the Court’s opinion is ambiguous on this point, see ante, at 620, I do not understand it to invalidate laws limiting benefits to veterans who resided in the State immediately prior to induction.

       After World War II, for example, the legislature decided to extend a property tax exemption to veterans of that war because it felt unable to finance a lump-sum cash bonus. For the background of this decision, see Albuquerque Journal, Mar. 10, 1947, p. 2, col. 4; id., Feb. 25, 1947, p. 1, col. 3; id., Jan. 19,1947, p. 4, cols. 4-5; id., Jan. 8,1947, p. 1, cols. 2-3; id., Jan. 5, 1947, p. 10, col. 2.

       The Court, however, makes the following remarkable statement:
      “The New Mexico statute, by singling out previous residents for the tax exemption, rewards only those citizens for their ‘past contributions’ toward our nation’s military effort in Vietnam. Zobel teaches that such an objective is ‘not a legitimate state purpose.’ 457 U. S., at 63.” Ante, at 622-623.
      Of course, what Zobel taught was that “past contributions” amounting to nothing more than residence in the State do not justify discrimination in favor of long-time residents; Zobel surely did not imply that past contributions to the Nation’s military effort would not justify a special reward, as the Court implicitly acknowledges when it recognizes as legitimate this Nation’s “ ‘longstanding policy of compensating veterans for their past contributions by providing them with numerous advantages.’ ” Ante, at 620 (quoting Regan v. Taxation With Representation of Wash., 461 U. S., at 551).

       See ante, at 621.

       Indeed, the New Mexico Legislature frequently extended the property tax exemption to veterans on a prospective basis. See 1933 N. M. Laws, ch. 44, p. 47 (approved Mar. 1, 1933, and applicable to all veterans of World War I resident as of Jan. 1,1934); 1923 N. M. Laws, ch. 130, p. 193 (approved Mar. 12, 1923, and applicable to all resident veterans). Other legislation was retroactive only by a few months. See 1947 N. M. Laws, ch. 79, p. 116 (approved Mar. 13, 1947, and applicable to all veterans of World War II resident as of Jan. 1, 1947). But see 1957 N. M. Laws, ch. 169, p. 256 (approved Mar. 28, 1957, and applicable to all Korean conflict veterans resident as of Jan. 1, 1955).

       The 1983 law was captioned as an amendment “to enlarge the period during which a Vietnam veteran may qualify for an exemption from property taxes.” 1983 N. M. Laws, ch. 330, p. 2111.

       Nor would I hold unconstitutional a provision in a State’s veterans’ assistance law which excluded veterans who had already received benefits in another State. New Mexico’s limitation of eligibility to Vietnam veterans taking up residence in the State prior to May 8, 1976, may in purpose and in practice have served to prevent “double-dipping” of just this kind.

       The State Court of Appeals wrote:
      “Hooper points out that the statute is undear as to whether the requirement at issue is a continuous residency requirement and that a veteran with only one day of New Mexico residency, immediately followed by an extended period of nonresidency prior to May 8,1976, might qualify for the exemption where Alvin D. Hooper does not.
      “Such arguments are not, standing alone, sufficient to allow this court to consider the issues raised. The exemption was not denied on either ground raised in support of this position. Hooper does not have standing to challenge the statute on the due process grounds of vagueness raised, and we decline to issue an advisory opinion on the matter. Advance Loan Co. v. Kovach, 79 N. M. 609, 445 P. 2d 386 (1968); Asplund v. Alarid, 29 N. M. 129, 219 P. 786 (1923).” 101 N. M. 172, 177, 679 P. 2d 840, 845 (1984).

       1 also discern no substance to appellants’ claim that the statutory classification violates the Due Process Clause of the Fourteenth Amendment. I further note that appellants’ jurisdictional statement raised no claim that New Mexico’s statute violates the Privileges and Immunities Clause of Article IV of the Constitution.