293 U.S. 194 (1934), 296, Borden's Farm Products Co., Inc. v. Baldwin

Docket NºNo. 296
Citation293 U.S. 194, 55 S.Ct. 187, 79 L.Ed. 281
Party NameBorden's Farm Products Co., Inc. v. Baldwin
Case DateDecember 03, 1934
CourtUnited States Supreme Court

Page 194

293 U.S. 194 (1934)

55 S.Ct. 187, 79 L.Ed. 281

Borden's Farm Products Co., Inc.

v.

Baldwin

No. 296

United States Supreme Court

Dec. 3, 1934

Argued November 6, 7, 1934

[55 S.Ct. 188] APPEAL FROM THE DISTRICT COURT OF THE UNITED STATES

FOR THE SOUTHERN DISTRICT OF NEW YORK

Syllabus

1. The presumption attaching to legislative action is a presumption of fact -- a presumption of the existence of factual conditions supporting the legislation; it is a rebuttable presumption. P. 209.

2. When a classification made by the legislature is called in question, if any state of facts reasonably can be conceived that would sustain it, there is a presumption of the existence of that state of facts, and he who assails the classification must carry the burden of showing by a resort to common knowledge or other matters which may be judicially noticed, or to other legitimate proof, that the action is arbitrary. P. 209.

3. That a classification made by a statute is arbitrary may appear on the face of the statute or by facts admitted or proved. P. 210.

4. Where legislative action is suitably challenged and a rational basis for it is predicated of the particular economic facts of a given trade or industry which are outside the sphere of judicial notice, those facts are properly the subject of evidence and of findings. P. 210.

5. With the notable expansion of the scope of governmental regulation, and the consequent assertion of violation of constitutional rights, it is increasingly important that, when it becomes necessary for the Court to deal with the facts relating to particular commercial or industrial conditions, they should be presented concretely with appropriate determinations upon evidence, so that conclusions shall not be reached without adequate factual support. P. 210.

6. That provision of the New York Milk Control legislation which permits dealers not having a "well advertised tradename" to sell milk at a minimum price lower than the minimum imposed on dealers having such a name, and which is limited in its operation to sales in the City of New York, does not appear to have been enacted as a precaution against monopoly, nor in support of a policy to increase the sales of milk. P. 205.

7. Whether this discriminatory price differential may be justified (1) as a means of protecting a selling advantage which dealers not

Page 195

having a "well advertised tradename" may have enjoyed before the State's scheme of fixing minimum prices to producers and consumers was adopted, and (2) as a means of insuring a return to old competitive conditions should that scheme be abandoned cannot be determined without knowledge of the particular trade conditions in the City of New York. Those conditions lie largely beyond the range of judicial notice, and, in a case disposed of below, without evidence or findings, by sustaining a motion to dismiss the bill for failure to state a cause of action, this Court cannot undertake to glean the factual basis of the provision from tables and statements in legislative reports not addressed to the subject, or from affidavits submitted to the court below on a motion for a preliminary injunction, which fell with the dismissal of the bill. P. 207.

8. A New York statute and administrative regulations fixing minimum prices for milk sold in New York City established a differential to the disadvantage of dealers having "a well advertised tradename," requiring in effect that the milk they dealt in be priced at one cent more per quart than milk dealt in by competitors. One of the four dealers classed within the quoted designation sued to enjoin enforcement of the differential, alleging, among other things, that it deprived the plaintiff of a large part of the market for its milk and seriously impaired the value of its property and goodwill, and that it was arbitrary, oppressive, and discriminatory, without any relation to public health or public welfare or to any of the objects for which the statute was enacted. Upon this ground, the bill charged that the statutory provision violated the due process and equal protection clauses of the Fourteenth Amendment.

Held:

(1) That it was error to dismiss the bill as insufficient on its face to state a cause of action. Pp. 203, 213.

(2) That the plaintiff should be permitted to proceed with the cause; the motion for preliminary injunction should be heard and decided; there should be a final hearing on pleadings and proofs, and the facts should be found and conclusions of law stated as required by Equity Rule 70 1/2. P. 213.

7 F.Supp. 352 reversed.

Appeal from a decree of the District Court, constituted of three judges, which dismissed, on a motion equivalent to a demurrer, a bill brought by the Borden Company against Baldwin, Commissioner of Agriculture and Markets of the State of New York, the Attorney General of the State, and five district attorneys, to enjoin enforcement of a provision of the New York Agriculture and Markets Law added by c. 126, Laws of 1934, § 258(q).

Page 200

HUGHES, J., lead opinion

MR. CHIEF JUSTICE HUGHES delivered the opinion of the Court.

The New York Milk Control Law of April 10, 1933,1 in authorizing the Milk Control Board to fix minimum prices for sales of fluid milk in bottles by milk dealers to stores in a city of more than one million inhabitants, established a differential of one cent a quart in favor of dealers not having a "well advertised tradename."2 The Milk Control Board determined that the phrase "well advertised tradename" referred to four dealers, of which the complainant, Borden's Farm Products Company, Inc., is one.3 The authority of the Board terminated on March 31, 1934. An amended act was passed to take effect April 1, 1934,4 which placed the milk control in a division of the Department of Agriculture and Markets. This Act continues the differential of one cent a quart in sales of fluid milk in bottles by dealers to stores, in favor of dealers not having

Page 201

a well advertised tradename, and provides that the lower price shall also apply on sales from stores to consumers.5

Complaining that the fixing of this differential, in respect to sales of the same commodity, was an invasion of rights guaranteed by the Fourteenth Amendment, plaintiff brought this suit to enjoin enforcement. An interlocutory injunction was sought, and a court of three judges was convened. Defendants moved to dismiss the complaint upon the grounds that it failed to state a cause of action in equity, and that the provision of the statute was constitutional. Affidavits were presented on both sides and the case was heard on the motion for injunction and the motion to dismiss. In view of the cumulative penalties provided, the court had no doubt of its jurisdiction to pass upon the question of constitutionality. Dealing with the case in that aspect, the court held that the complaint did not state a cause of suit, and dismissed it for that reason. The court regarded the application for an interlocutory injunction as necessarily falling with the complaint, and hence made no findings of fact., 7 F.Supp. 352, 354. The plaintiff appeals.

We turn to the allegations of the complaint. Plaintiff sets forth the full text of the Acts of 1933 and 1934 and of the applicable orders. By the order of the Commissioner

Page 202

of Agriculture and Markets, the minimum prices for the sale of fluid milk in bottles by dealers to consumers and to stores, and by stores to consumers, are fixed for the City of New York. The order determining the four dealers who [55 S.Ct. 189] have a "well advertised tradename" is continued in effect. Plaintiff alleges that, for many years, it has been continuously engaged in purchasing and selling milk in bottles in the City of New York, and has built up a large business under its tradename "Borden's" for sales both to consumers and to the stores described in the statute;6 that it operates nine retail stores in the city at which it has an extensive business in the sale of bottled milk to consumers under its tradename; that it has obtained from the Board of Health of the city all the necessary licenses and permits, and has observed all the regulations of the Sanitary Code; that it has expended large sums in advertising its tradename and has thus created a valuable goodwill. Plaintiff alleges that it is in direct and active competition with numerous individuals, corporations, and associations which are selling bottled milk to stores in the city but are not within the official determination of those having a "well advertised tradename;" that these competitors are permitted to sell to stores bottled milk at a price one cent per quart below the minimum price at which plaintiff is permitted to sell its bottled milk to stores under its tradename, and that stores are permitted to sell to consumers the bottled milk of these competitors with the same differential as compared with the minimum price at which plaintiff's milk may be sold by stores, and thus plaintiff is deprived of a large part of the market for its milk and the value of its property and goodwill are seriously impaired. Plaintiff

Page 203

states that the loss in trade it thus suffers amounts to not less than 25,000 quarts of bottled milk daily.

Plaintiff alleges that the maintenance of this differential, with the consequent privilege to its competitors and restraint upon itself, is "arbitrary, oppressive and discriminatory," and has "no relation to the protection of the public health or the public welfare or to any of the objects or purposes" for which the statute was enacted, and, upon this ground, plaintiff charges that the statutory provision violates the due process and equal protection clauses of the Fourteenth Amendment. Inability to obtain a license, unless plaintiff agrees in writing to comply with the statute and orders, and the prohibitive character of the penalties prescribed, are assigned as...

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309 practice notes
  • 531 F.2d 224 (5th Cir. 1976), 72--2373, Usery v. Tamiami Trail Tours, Inc.
    • United States
    • Federal Cases United States Courts of Appeals United States Court of Appeals (5th Circuit)
    • May 5, 1976
    ...procedure, is not necessarily precluded from resolving issues of legislative fact, Borden's Farm Products, Inc. v. Baldwin, 1934, 293 U.S. 194, 55 S.Ct. 187, 79 L.Ed. 281, it is generally thought that their determination is particularly appropriate to the administrative process, where staff......
  • 199 P.2d 530 (Kan. 1948), 37477, Board of Com'rs of Sedgwick County v. Robb
    • United States
    • Kansas United States State Supreme Court of Kansas
    • November 13, 1948
    ...general. Intervenors and the auditor contend the classification is arbitrary and unreasonable. In Borden's Farm Products Co. v. Baldwin, 293 U.S. 194, 209, 55 S.Ct. 187, 192, 79 L.Ed. 281, the Supreme Court, in an opinion by Hughes, C. J., said: [166 Kan. 133] 'When the classification made ......
  • 19 Misc.2d 176, Town of Hempstead v. Goldblatt
    • United States
    • New York United States State Supreme Court (New York)
    • July 13, 1959
    ...ordinance itself. But it is fundamental that an ordinance such as this is presumed constitutional (Borden's Farm Products Co. v. Baldwin, 293 U.S. 194, 209, 210, 55 S.Ct. 187, 79 L.Ed. 281); that the burden of showing the ordinance to be unreasonable rests upon the assailant (Wiggins v. Tow......
  • 277 N.Y. 292, People ex rel. Buffalo and Fort Erie Public Authority v. Davis
    • United States
    • New York United States Court of Appeals (New York)
    • March 8, 1938
    ...70 N.Y. 327; Matter of McAneny v. Board of Estimate, 232 N.Y. 377; Sinking Fund Cases, 99 U.S. 700; Borden's Farm Products Co. v. Baldwin, 293 U.S. 194; People v. Devlin, 33 N.Y. 269; Field v. Clark, 143 U.S. 649; People ex rel. Purdy v. Commissioners of Highways, 54 N.Y. 276; Helm v. Day, ......
  • Request a trial to view additional results
303 cases
  • 531 F.2d 224 (5th Cir. 1976), 72--2373, Usery v. Tamiami Trail Tours, Inc.
    • United States
    • Federal Cases United States Courts of Appeals United States Court of Appeals (5th Circuit)
    • May 5, 1976
    ...procedure, is not necessarily precluded from resolving issues of legislative fact, Borden's Farm Products, Inc. v. Baldwin, 1934, 293 U.S. 194, 55 S.Ct. 187, 79 L.Ed. 281, it is generally thought that their determination is particularly appropriate to the administrative process, where staff......
  • 199 P.2d 530 (Kan. 1948), 37477, Board of Com'rs of Sedgwick County v. Robb
    • United States
    • Kansas United States State Supreme Court of Kansas
    • November 13, 1948
    ...general. Intervenors and the auditor contend the classification is arbitrary and unreasonable. In Borden's Farm Products Co. v. Baldwin, 293 U.S. 194, 209, 55 S.Ct. 187, 192, 79 L.Ed. 281, the Supreme Court, in an opinion by Hughes, C. J., said: [166 Kan. 133] 'When the classification made ......
  • 19 Misc.2d 176, Town of Hempstead v. Goldblatt
    • United States
    • New York United States State Supreme Court (New York)
    • July 13, 1959
    ...ordinance itself. But it is fundamental that an ordinance such as this is presumed constitutional (Borden's Farm Products Co. v. Baldwin, 293 U.S. 194, 209, 210, 55 S.Ct. 187, 79 L.Ed. 281); that the burden of showing the ordinance to be unreasonable rests upon the assailant (Wiggins v. Tow......
  • 277 N.Y. 292, People ex rel. Buffalo and Fort Erie Public Authority v. Davis
    • United States
    • New York United States Court of Appeals (New York)
    • March 8, 1938
    ...70 N.Y. 327; Matter of McAneny v. Board of Estimate, 232 N.Y. 377; Sinking Fund Cases, 99 U.S. 700; Borden's Farm Products Co. v. Baldwin, 293 U.S. 194; People v. Devlin, 33 N.Y. 269; Field v. Clark, 143 U.S. 649; People ex rel. Purdy v. Commissioners of Highways, 54 N.Y. 276; Helm v. Day, ......
  • Request a trial to view additional results
5 books & journal articles
  • Rethinking the presumption of constitutionality.
    • United States
    • Notre Dame Law Review Vol. 85 Nbr. 4, June 2010
    • June 1, 2010
    ...of a statute is constitutional, see United States v. Raines, 362 U.S. 17, 21-22 (1960). (3) Borden's Farm Prods. Co. v. Baldwin, 293 U.S. 194, 209 (1934) ("[l]f any state of facts reasonably can be conceived that would sustain [the challenged legislation], there is a presumption of the......
  • Lost fidelities.
    • United States
    • William and Mary Law Review Vol. 41 Nbr. 1, December 1999
    • December 1, 1999
    ...dealers of "unadvertised milk" to sell at a price lower than that prescribed for dealers in milk sold under trade names), rev'd, 293 U.S. 194 (1934); Hegeman Farms Corp. v. Baldwin, 6 F. Supp. 297, 297-98 (S.D.N.Y.) (upholding provisions of New York milk control law), aff'd, 293 U......
  • Legislative record review.
    • United States
    • Stanford Law Review Vol. 54 Nbr. 1, October 2001
    • October 1, 2001
    ...(50.) Pac. States Box & Basket Co. v. White, 296 U.S. 176, 185 (1935) (Brandeis, J.) (quoting Borden's Farm Prods. Co. v. Baldwin, 293 U.S. 194, 209 (1934)). (51.) 304 U.S. 144 (1938). (52.) Id. at 148-49. (53.) Id. at 152. (54.) Id. at 152 n.4. (55.) Allied Stores v. Bowers, 358 U.S. 5......
  • Suboptimal social science and judicial precedent.
    • United States
    • University of Pennsylvania Law Review Vol. 161 Nbr. 5, April - April 2013
    • April 1, 2013
    ...(quoting Edmund M. Morgan, Judicial Notice, 57 HARV. L. REV. 269, 270-71 (1944)). (51) Id. (citing Borden's Farm Prods. Co. v. Baldwin, 293 U.S. 194 (1934)); see also Arthur Selwyn Miller & Jerome A. Barron, The Supreme Court, the Adversary System, and the Flow of Information to the Jus......
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