103 F.Supp. 569 (D.D.C. 1952), Civ. A. 1550-52, Youngstown Sheet & Tube Co. v. Sawyer

Docket Nº:Civ. A. 1550-52
Citation:103 F.Supp. 569
Party Name:Youngstown Sheet & Tube Co. v. Sawyer
Case Date:April 29, 1952
Court:United States District Courts, District of Columbia

Page 569

103 F.Supp. 569 (D.D.C. 1952)



SAWYER, Secretary of Commerce and nine other cases.

Civil Actions Nos. 1550-52, 1635-52, 1539-52, 1647-52, 1732-52, 1700-52, 1549-52, 1581-52, 1624-52, 1625-52.

United States District Court, District of Columbia.

April 29, 1952

Judgment Affirmed 72 S.Ct. 863.

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[Copyrighted Material Omitted]

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John J. Wilson, John C. Gall, Washington, D.C., and J. E. Bennett, Youngstown, Ohio, for plaintiffs The Youngstown Sheet and Tube Co. and The Youngstown Metal Products Co.

Hogan & Hartson, by Edmund L. Jones and Howard Boyd, Washington, D.C., Gall, Lane & Howe, by John C. Gall, Washington, D.C., Jones, Day, Cockley & Reavis, by Luther Day and T. F. patton, all of Cleveland, ohio, for plaintiff Republic Steel Corporation.

James C. Peacock, Washington, D.C., Randolph W. Childs, and Edgar S. McKaig, Philadelphia, Pa., for plaintiff E. J. Lavino & Company.

Breed, Abbott & Morgan, New York City, by Joseph P. Tumulty, Jr., Washington, D.C., and Charles H. Tuttle, New York City, for plaintiff Armco Steel Corporation.

Cravath, Swaine & Moore, by Bruce Bromley, New York City, Wilmer & Broun, by E. Fontaine Broun, Washington, D.C., for Bethlehem Steel Co.

Jones, Day, Cockley & Reavis, Cleveland, Ohio, by Sturgis Warner, Washington, D.C., H. Parker Sharp, Reed, Smith, Shaw & McClay, by John C. Bane, Jr., and Walter T. McGough, all of Pittsburgh, Pa., for plaintiff Jones & Laughlin Steel Corporation.

Davis, Polk, Wardwell, Sunderland & Kiendl, by John W. Davis and Theodore Kiendl, New York City, Covington & Burling, by John Lord O'Brian and Howard C. Westwood, Washington, D.C., and Roger M. Blough, Pittsburgh, Pa., for plaintiff United States Steel Co.

Holmes Baldridge, Asst. Atty. Gen., of the United States, Marvin C. Taylor and Samuel D. Slade, Attorneys, Dept. of Justice, Washington, D.C., for defendant.

PINE, District Judge.

By Executive Order 10340, promulgated April 8, 1952, the President of the United States directed defendant to take possession of such plants of companies named in a list attached thereto as he deemed necessary in the interests of national defense, to

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operate them or arrange for their operation, and to prescribe the terms and conditions of employment under which they should be operated. The plaintiffs are among those named in the list. In the recitals of the Executive Order, the President stated that a controversy had arisen between certain companies producing and fabricating steel and certain of their workers represented by the United Steel Workers of America, C.I.O., regarding terms and conditions of employment; that the controversy had not been settled through the processes of collective bargaining or through the efforts of the Government, and a strike had been called for April 9, 1952; that a work stoppage would immediately jeopardize and imperil our national defense and the defense of those joined with us in resisting aggression; and that in order to insure the continued availability of steel it was necessary that the United States take possession of and operate the plants. By virtue of this Executive Order, defendant issued his Order No. 1 bearing the same date, stating that he deemed it necessary in the interest of national defense that possession be taken of the plants of the companies named in a list attached to his order, including the plant of plaintiffs, and that therefore he did take possession of the same, effective April 8, 1952. By the same order, he designated the president of each company as operating manager for the United States until further notice, and directed him to operate the plants of such company, subject to defendant's supervision. Telegraphic notification to this effect was given to the president of each company.

Plaintiffs thereupon brought these actions praying for declaratory judgments and injunctive relief, and there are now before me for decision motions for temporary injunctions seeking to restrain the defendant from taking any action under the authority of the Executive Order. These motions were combined for hearing and have been fully heard. Voluminous briefs have been filed and considered. At the hearing, plaintiff United States Steel limited its motion to a preservation of the status quo in respect of terms and conditions of employment.

Plaintiffs contend that defendant's acts under the Executive Order resulting in the seizure of their plants are without authority of law and constitute an illegal invasion of their property and rights, and that they are entitled to preliminary injunctions to restrain defendant from acting thereunder, particularly in the light of his threat to make changes in terms and conditions of employment. The basis of plaintiffs' contention is that there is no constitutional or statutory right in the President to issue the Executive Order, and there being none, defendant acting thereunder is acting without legal authority and his acts are illegal and contrary to law. Plaintiff Lavino has urged an additional reason, namely, that it has been improperly included among the plants seized.

Defendant contends in his Opposition to the motions that the breakdown of collective bargaining negotiations 'created an immediately impending national emergency because interruption of steel manufacture for even a brief period would seriously endanger the well-being and safety of the United States in a critical situation'; that the President has 'inherent power in such a situation to take possession of the steel companies in the manner and to the extent which he did by his Executive Order'; that the courts are without power to negate Executive action of the President by enjoining it; that the courts will not interfere in advance of a full hearing on the merits except upon a showing that the damage to flow from a refusal of a temporary injunction is irreparable and outweighs the harm which would result from its issuance; and that, since the right of the companies to recover all damages resulting from the taking has been recognized by Supreme Court decisions, there is no showing that the companies' legal remedy is inadequate or that their injury is irreparable.

Before proceeding to a discussion of the points of law involved herein, it should be said that the merits of the controversy between plaintiffs and the United

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Steel Workers of America, C.I.O., are not before the Court for adjudication. Further, it should be noted that, although there is no law of the case rule in interlocutory orders in this jurisdiction, these cases are in a materially different posture than they were when Judge Holtzoff of this court refused a temporary restraining order in respect of several of them.

The fundamental issue is whether the seizure is or is not authorized by law. In my opinion, this issue should be decided first, and that I shall now do.

There is no express grant of power in the Constitution authorizing the President to direct this seizure. There is no grant of power from which it reasonably can be implied. There is no enactment of Congress authorizing it. On what, then, does defendant rely to sustain his acts? According to his brief, reiterated in oral argument, he relies upon the President's 'broad residuum of power' sometimes referred to as 'inherent' power under the Constitution, which, as I understand his counsel, is not to be confused with 'implied' powers as that term is generally understood, namely, those which are reasonably appropriate to the exercise of a granted power.1

This contention requires a discussion of basic fundamental principles of constitutional government, which I have always understood are immutable, absent a change in the framework of the Constitution itself in the manner provided therein. The Government of the United States was created by the ratification of the Constitution. It derives its authority wholly from the powers granted to it by the Constitution, which is the only source of power authorizing action by any branch of Government. It is a government of limited, enumerated, and delegated powers.2 The office of President of the United States is a branch of the Government, namely, that branch where the executive power is vested, and his powers are limited along with the powers of the two other great branches or departments of Government, namely, the legislative and the judicial.3

The President therefore must derive this broad 'residuum of power' or 'inherent' power from the Constitution itself, more particularly Article II thereof, which contains the grant of Executive power. That Article provides that the executive power shall be vested in the President; that he shall swear he will faithfully execute the office of President and will to the best of his ability preserve, protect, and defend the Constitution of the United States, Sec. 1; that he shall be commander in chief of the army and navy of the United States, Sec. 2; and that he shall take care that the laws be faithfully executed, Sec. 3. These are the only sections which have any possible relevancy, and their mere enumeration shows the utter fallacy of defendant's claim. Neither singly nor in the aggregate do they grant the President, expressly or impliedly, as that term has hereinabove been defined, the 'residuum of power' or 'inherent' power which authorizes him, as defendant claims, to take such action as he may deem to be necessary, including seizure of plaintiffs' properties, whenever in his opinion an emergency exists requiring him to do so in the public interest.4 Instead, in Congress

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is lodged, within Constitutional limitations,...

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