United States v. Ferger

• Decision Date: 02 June 1919
• Docket Number: No. 776,776
• Citation: 63 L.Ed. 936,39 S.Ct. 445,250 U.S. 199
• Parties: UNITED STATES v. FERGER et al
• Court: U.S. Supreme Court

250 U.S. 199

39 S.Ct. 445

63 L.Ed. 936

UNITED STATES

v FERGER et al.

No. 776.

Argued April 29, 1919.

Decided June 2, 1919.

Mr. Assistant Attorney General Brown, for the United States.

Mr. Charles E. Hughes, of New York City, for defendants in error.

Mr. Chief Justice WHITE delivered the opinion of the Court.

The 24 counts of the indictment in this case were concerned with the commission of acts defined as criminal and punished by the forty-first section of the Act of August 29, 1916, entitled, 'An act relating to bills of lading in interstate and foreign commerce.' 39 Stat. 538, 544, c. 415 (Comp. St. § 8604u).

In the first count it was charged that the accused, in violation of the section, on or about the 14th day of August, 1917, in Cincinnati, Ohio——

'did * * * feloniously, and with intent to defraud, falsely make, forge, and counterfeit, and aid and assist in feloniously making, forging, and counterfeiting, a certain bill of lading purporting to represent goods received at Fountaintown, in the state of Indiana, for shipment to Cincinnati, in the state of Ohio, and to utter and publish and aid and assist in uttering and publishing such falsely made, forged, and counterfeited bill of lading, then and there knowing the same to be falsely made, forged, and counterfeited. * * *'

A copy of the fabricated bill of lading was reproduced in the count. It was negotiable in form, following the standard approved by the Interstate Commerce Commission (Order No. 787, June 27, 1908). The bill acknowledged the receipt by the Cincinnati, Hamilton & Dayton Railway Company of corn in bulk at a designated place in Indiana, shipped to Cincinnati to the order of the shipper, and with directions to notify a person named. It contained all the earmarks which would have been found in a genuine bill of lading.

The second count charged the knowing, willful, and felonious uttering of the bill of lading, and, with criminal intent and knowledge, obtaining money on it from the Second National Bank of Cincinnati by using it as collateral.

These first 2 counts are types of the remaining 22, except that the latter dealt with 11 other bills of lading as to each of which there were 2 counts, charging in the exact words used in the first and second counts, on the one hand the felonious fabricating and uttering of a bill of lading, and on the other hand the uttering and obtaining on the same bill of money from the Second National Bank of Cincinnati.

There was a motion to quash all the counts based upon alleged defects in pleading with which we are not concerned, and by demurrer the failure of the indictment to charge an offense was asserted on these grounds:

'First. That said Act of Congress * * * approved August 29, 1916, is unconstitutional and void, especially section 41 of said act in so far as it attempts to make it a crime and punish any person who forges or counterfeits a bill of lading where no shipment from one state to another is made or intended.

'Second. That said act can only apply to bills of lading representing actual shipments of merchandise or commerce between the states. If it is intended to apply to wholly fictitious shipments it is unconstitutional and void so far as said fictitious shipments are concerned, because the power of Congress to legislate upon this subject matter is based wholly and solely upon the commercial clause of the Constitution, and if there is no commerce, there is no jurisdiction.'

The demurrer was sustained and all the counts in the indictment were dismissed (256 Fed. 388). The court said:

'It was agreed in the argument and assumed in the briefs of counsel that the so-called bills of lading were fictitious, in that there was no actual consignor or consignee and that they did not relate to any shipment or attempted shipment of corn whatsoever. This fact so agreed upon in open court is to be read into the indictments.'

Dealing with the case thus made, the court observed:

'These bogus bills of lading were nothing but pieces of paper, fraudulently inscribed to represent a real contract between real people and the actual receipt of goods for interstate shipment. * * * That they were inscribed so as to purport to relate to interstate shipments was nothing else than a fraud upon such persons as innocently took them, as collateral or otherwise. The execution of them and their use for obtaining money under false pretenses was nothing other than a crime of a kind cognizable by the criminal legislation of the states, and a matter with which the Congress, in the exercise of its power to regulate commerce, is not concerned.'

And upon these premises, after reviewing what were deemed to be the controlling authorities, it was concluded that the case——

'must be decided in favor of the defendants, and the holding made that the Congress has not the power, under the commerce clause, to prescribe a punishment under the circumstances of this case, and if the Congress has sought to do so, the attempt is futile, because without authority.'

Despite the hypothetical form in which this conclusion is expressed, the context of the opinion makes it certain that, reading the facts charged in the indictment in the light of the admissions made at the argument, the court construed the section of the statute as embracing such acts and decided that as thus construed it was void for repugnancy to the Constitution.

At the outset confusion in considering the issue may result unless obscurity begotten by the form in which the contention is stated by dispelled. Thus both in the pleadings and in the contention as summarized by the court below it is insisted that, as there was and could be no commerce in a fraudulent and fictitious bill of lading, therefore the power of Congress to regulate commerce could not embrace such pretended bill. But this mistakenly assumes that the power of Congress is to be necessarily tested by the intrinsic existence of commerce in the particular subject dealt with, instead of by the relation of that subject to commerce and its effect upon it. We say mistakenly assumes, because we think it clear that if the proposition were sustained it would destroy the power of Congress to...