Central Roig Refining Co. v. Secretary of Agriculture, 9769.

• Decision Date: 24 November 1948
• Docket Number: No. 9769.,9769.
• Citation: 171 F.2d 1016
• Parties: CENTRAL ROIG REFINING CO. et al. v. SECRETARY OF AGRICULTURE (PORTO RICAN AMERICAN SUGAR REFINERY, Inc., et al., Intervenors).
• Court: U.S. Court of Appeals — District of Columbia Circuit

171 F.2d 1016 (1948)

CENTRAL ROIG REFINING CO. et al. v. SECRETARY OF AGRICULTURE (PORTO RICAN AMERICAN SUGAR REFINERY, Inc., et al., Intervenors).

No. 9769.

United States Court of Appeals District of Columbia Circuit.

Argued October 6, 1948.

Decided November 24, 1948.

Mr. Frederic P. Lee, of Washington, D. C., for appellants.

Mr. James A. Doyle, Associate Solicitor, of Omaha, Neb., Department of Agriculture, of the Bar of the Supreme Court of Nebraska, pro hac vice by special leave of court, with whom Messrs. George Morris Fay, U. S. Atty., of Washington, D. C., and J. Stephen Doyle, Jr., Special Asst. to the Atty. Gen., were on the brief, for appellee. Messrs. Sidney S. Sachs and John D. Lane, Asst. U. S. Attys. both of Washington, D. C., also entered appearances for appellee.

Messrs. Arthur L. Quinn, of Washington, D. C., and Orlando J. Antonsanti, of San Juan, P. R., with whom Mr. Gordon P. Peyton, of Washington, D. C., was on the brief, for intervenor Porto Rican American Sugar Refinery, Inc., urging affirmance. Mr. Dean G. Acheson, of Washington, D. C., with whom Mr. Donald Hiss, of Washington, D. C., was on the brief for intervenors American Sugar Refining Company, et al., urging affirmance.

Mr. Walton Hamilton, with whom Mr. Thurman Arnold, of Washington, D. C., was on the brief, for intervenor Government of Puerto Rico, urging reversal. Mr. Abe Fortas, of Washington, D. C., also entered an appearance for intervenor Government of Puerto Rico.

Before EDGERTON, CLARK, and WILBUR K. MILLER, Circuit Judges.

EDGERTON, Circuit Judge.

Section 207(b) of the Sugar Act of 1948 provides that "Not more than one hundred and twenty-six thousand and thirty-three short tons, raw value, of the quota for Puerto Rico for any calendar year may be filled by direct-consumption sugar." 61 Stat. 922, 927, 7 U.S.C.A. § 1117(b). "The quota for Puerto Rico" means the quantity of sugar that may be imported into continental United States from Puerto Rico. "Direct-consumption sugar" means, approximately, refined sugar.

Section 205(a) of the Act provides that whenever the Secretary of Agriculture "finds that the allotment of any quota, or proration thereof, * * * is necessary to * * * prevent disorderly marketing * * * or to afford all interested persons an equitable opportunity to market sugar * * * he shall allot to persons who market or import sugar * * * the quantities * * * which each such person may market in continental United States * * * for consumption therein. Allotments shall be made in such manner and in such amounts as to provide a fair, efficient, and equitable distribution of such quota * * *, by taking into consideration the processings of sugar or liquid sugar from sugar beets or sugarcane to which proportionate shares, determined pursuant to the provisions of subsection (b) of section 302, pertained;¹ the past marketings or importations of each such person; and the ability of such person to market or import that portion of such quota * * * allotted to him." If, then, allotments are made at all, they "shall be made * * * by taking into consideration" three factors or standards; (1) processings of "proportionate shares" sugar, (2) "past marketings," and (3) "ability * * * to market".

Much more direct-consumption sugar is on the market in Puerto Rico than the 126,033 tons that § 207(b) permits to be imported into the United States. In Puerto Rico Sugar Order 18, 13 Fed.Reg. 310, 313, the Secretary concluded "(1) that the allotment of the direct-consumption portion of the 1948 sugar quota for Puerto Rico is necessary to prevent disorderly marketing of such sugar and to afford all interested persons an equitable opportunity to market such sugar in the continental United States; (2) that in order to make a fair, efficient, and equitable distribution of the direct-consumption portion of such quota, as required by section 205(a) of the act, allotments should be made by giving equal weight to (a) past marketings, measured by the average of the highest five years of such marketings by each refiner during the period 1935-1941, inclusive, and (b) ability to market, measured by the highest single year's marketings during the period 1935-1947, inclusive." The order allots direct-consumption sugar, among refiners operating in Puerto Rico, in accordance with these views.

The appellants, two refiners operating in Puerto Rico, bring the order here on appeal under § 205 of the Act. They contend that the order discriminates against them in violation of the Act and of the Constitution. They attack the constitutionality of § 207(b) and the alleged compliance of the order with § 205(a). Porto Rican American Sugar Refinery, Inc., to which the order is very favorable, intervenes in its support. The Government of Puerto Rico intervenes to attack the constitutionality of § 207(b). The American Sugar Refining Company and other mainland refiners intervene to defend its constitutionality.

Though the order purports to give effect to "ability to market" we think it fails to do so. The Secretary argues that "in fairness to those refiners on whom the impact of war was greatest, it is considered fair and reasonable to select a prewar year as a proper measure of their ability. Therefore, the best single year's performance during the past 13 years is deemed to afford a fair and equitable measure of the ability of each refiner to market direct-consumption sugar." We cannot follow this argument. Performance in the 12 years before 1947 has nothing to do with ability to market in 1948. The Secretary's argument undertakes to equate each refiner's ability to market with the right to market that the Secretary thinks the refiner ought, as a matter of fairness, to have. By requiring the Secretary to take into consideration ability to market, Congress foreclosed the question whether wartime...