Royal Baking Powder Co. v. Emerson

• Decision Date: 05 November 1920
• Docket Number: 5575.
• Citation: 270 F. 429
• Parties: ROYAL BAKING POWDER CO. v. EMERSON, Pros. Atty.
• Court: U.S. Court of Appeals — Eighth Circuit

270 F. 429

ROYAL BAKING POWDER CO. v. EMERSON, Pros. Atty.

No. 5575.

United States Court of Appeals, Eighth Circuit.

November 5, 1920

Rehearing Denied December 29, 1920. [Copyrighted Material Omitted]

Archibald Cox, of New York City (John M. Moore, of Little Rock, Ark and Samuel W. Fordyce, Jr., of St. Louis, Mo., on the brief) for appellant.

T. M. Mehaffy and J. F. Loughborough, both of Little Rock, Ark., and John D. Arbuckle, Atty. Gen. (James Love Hopkins, of St. Louis, Mo., on the brief), for appellee.

Before HOOK and STONE, Circuit Judges, and JOHNSON, District Judge.

STONE Circuit Judge.

Appellant has been for years a manufacturer and seller of a baking powder known as 'Dr. Price's Cream Baking Powder.' Until recently this powder was what is known as a cream of tartar powder, as distinguished from phosphate powders or alum powders. A few months before this action was commenced this powder had been changed to a phosphate powder, by entire substitution of phosphate for cream of tartar as the acid ingredient. Appellant thereupon altered the labels upon the cans of this powder in an attempt to avoid deception of the buying public, and at the same time to retain the good will it had, during years, built up for the Dr. Price brand. Some of these new-labeled cans of the phosphate powder were sent into Arkansas. Under the statutes of that state against misbranding of foodstuffs, the state commissioner of mines, manufactures, and agriculture is empowered to issue a certificate to the effect that an article of food is misbranded, and upon receipt of such certificate by any prosecuting attorney of the state it is his duty to institute criminal proceedings against persons selling or offering to sell such misbranded articles. Such a certificate was issued by the commissioner in regard to the above new phosphate powders made by appellant. This bill was filed against Emerson, as a prosecuting attorney and as representative of all prosecuting attorneys, to enjoin such prosecution. Upon final hearing, the court found that the certificate issued by the commissioner had been erroneously issued, because not based upon substantial evidence at the hearing before him, as required by the state statute. It, therefore, granted a permanent injunction against prosecutions based upon that particular certificate. The court, however, refused to enjoin Emerson and other prosecuting attorneys from beginning and pursuing prosecutions for misbranding 'on their own initiative under the general laws of the state. ' From this latter portion of the decree this appeal is brought.

The jurisdiction of the court is contested by appellee, upon the grounds that the jurisdictional amount is absent and that this is an attempt to enjoin a criminal prosecution. The jurisdictional amount is alleged to be the value of the good will in the long-established brand of powder made and sold by appellant. The value of this good will is not questioned, but appellee contends that its present use is a fraud prohibited by statute, and that there can be no property right or value in an unlawful brand. Of course, no right to defraud can be recognized by courts as having any claim to legally exist or be protected, or as having any value. Here, however, the appellant has had for years a valuable good will in the brand of powder known as 'Dr. Price's Cream Baking Powder,' and it claims that the new label is lawful and enables it to retain this good will, and that such valuable good will thus lawfully employed is threatened with destruction by the illegal acts of appellee. If these claims of appellant are true, it has a valuable property right which is imperiled. At least, that is the substantial basis of the action as revealed in the complaint, and therefore sufficiently establishes the jurisdiction against this objection.

It is true that the general rule is that courts of equity will not enjoin criminal prosecutions. The exception is that where property rights are involved, and it is claimed seriously and in good faith that the act of the prosecutor is not authorized by law, equity can act. Hebe Co. v. Shaw, 248 U.S. 297, 39 Sup.Ct. 125, 63 L.Ed. 255; Greene v. Louisville, etc., R.R. Co., 244 U.S. 499, 506, 507, 37 Sup.Ct. 673, 61 L.Ed. 1280, Ann. Cas. 1917E, 88; Truax v. Raich, 239 U.S. 33, 37, 36 Sup.Ct. 7, 60 L.Ed. 131, L.R.A. 1916D, 545, Ann. Cas. 1917B, 283; Western Union Telegraph Co. v. Andrews, 216 U.S. 165, 30 Sup.Ct. 286, 54 L.Ed. 430; Ex parte Young, 209 U.S. 123, 28 Sup.Ct. 441, 52 L.Ed. 714, 13 L.R.A. (N.S.) 932, 14 Ann.Cas. 764. This lack of legal authority may arise because the act is within an invalid statute, or because it is not authorized by a valid statute. In either case the act is without legal sanction, is not protected by the official status of the prosecutor, and can be restrained. The complaint alleges a multiplicity of threatened prosecutions, and irreparable injury thereby through destruction of a valuable good will in an established trade brand; that such prosecutions are arbitrary, capricious, and unreasonable, and therefore not within nor authorized by the state statutes, but violative of appellant's rights, under Amendment 14, Sec. 8, of article 1, and article 6 of the national Constitution. These contentions are apparently urged seriously and in good faith. They support the jurisdiction of the court.

The contentions made by appellant are, first, that the Arkansas statute as to misbranding does not include baking powders; second, that if such statutes do include baking powders, the only penalty provided for the sale of such as are imported into the state is a seizure of such powders through a proceeding in rem; third, that the label involved complies with the national Food and Drugs Act, and shipment of powders so branded cannot be interfered with prior to 'the first sale of said packages in Arkansas'; fourth, that certain evidence was erroneously admitted and considered by the trial court; fifth, that upon the entire evidence the conclusion should be that the new label was not a misbranding.

The basis of the claim that baking powder is not within the state misbranding statute are that such powder is not within the statutory term 'article of food,' and that the circumstances of the enactment of the statute prove that the Legislature did not intend baking powders to be included in such term, even if that term were in itself sufficient to include them. The contention as to the first ground is that baking powder is not eaten or taken into the body, but that it is merely an agency for 'raising' the bread through the release of carbonic acid gas by chemical action, produced when moisture and heat in the bread dough act upon the powder. This seems an artificial view, when the fact, admitted in the record, is considered that the appellant has for years carried on an extensive advertising campaign based on the claim that cream of tartar powders were healthful, while alum and phosphate powders were deleterious to health. The statute covers 'any article of food,' and was designed to protect the public from adulteration and deception. The term 'any article of food' is sufficiently broad to cover any article ordinarily eaten or drunk, whether it be so used alone, or as a part of some mixture or compound which is eaten or drunk. Neither baking powder nor flour is eaten as such, but both are intended as components of bread. The purpose of the statute requires that this broad meaning be given the above term, unless the statute is to be materially crippled in its intended effect. The legal history of a similar English statute (St. 38 & 39 Vict.c. 63) as construed in James v. Jones, (1894) 1 Q.B. 304, is not persuasive in the presence of the obvious purpose of the Arkansas statute.

But it is claimed that, even though the term 'any article of food' might be construed to include baking powders, yet the circumstances of enactment of this statute reveal that such construction was not intended by the Legislature. This contention is based on the claim that this statute was closely modeled after the national Food and Drug Act of June 30, 1906 (34 Stat. 769 (Comp. St. Secs. 8717-8728)); that the national act (section 8), which defined misbranding, was, by its terms, made applicable 'to all drugs, or articles of food, or articles which enter into the composition of food'; that baking powders were brought within the act only by the above italicized language; that this language is omitted from the Arkansas statute; that therefore the Legislature intended to omit such articles from the state statute. The national, as the state, act is aimed at adulteration, and also misbranding. The only language therein which could make baking powders subject to the adulteration provisions of the national act is 'any article of food which is adulterated or misbranded,' in section 1, and 'the term 'food,' as used herein, shall include all articles used for food, drink, confectionery, or condiment by man or other animals, whether simple, mixed, or compound,' in section 6.

The argument of appellant is that this language does not include such powders under the adulteration provisions of the act, because in the misbranding portions (section 8) it declares that misbranding shall apply 'to all * * * articles of food, or articles which enter into the composition of food. ' We have neither been cited nor have we found any adjudication of this exact point in any contested case. The nearest approach is Hipolite Egg Co. v. United States, 220 U.S. 45, 31 Sup.Ct. 364, 55 L.Ed. 364, where the charge was that preserved eggs were adulterated. One point urged in that case (220 U.S. 52, 31 Sup.Ct. 365, 55 L.Ed. 364), was that the act did not apply--

'to an article of food which has not been...