Tobin v. Banks & Rumbaugh

• Decision Date: 14 January 1953
• Docket Number: No. 14191.,14191.
• Citation: Tobin v. Banks & Rumbaugh, 201 F.2d 223 (5th Cir. 1953)
• Parties: TOBIN, Secretary of Labor, v. BANKS & RUMBAUGH.
• Court: U.S. Court of Appeals — Fifth Circuit

201 F.2d 223 (1953)

TOBIN, Secretary of Labor, v.BANKS & RUMBAUGH.

No. 14191.

United States Court of Appeals Fifth Circuit.

January 14, 1953.

William S. Tyson, Sol., Bessie Margolin, Asst. Sol., William A. Lowe and Sylvia S. Ellison, Attys., U. S. Dept. of Labor, Washington, D. C., and Earl Street, Reg. Atty., Dallas, Tex., for appellant.

Tom Sealy and J. Henry Wilkinson, Jr., Midland, Tex., for appellee.

Before HOLMES, RUSSELL and STRUM, Circuit Judges.

RUSSELL, Circuit Judge.

The Secretary of Labor, acting pursuant to his authority under § 9,15 U.S.C.A. § 49, made applicable by § 9 of the Fair Labor Standards Act of 1938,52 Stat. 1060,29 U.S.C.A. § 209, caused to be served upon Banks & Rumbaugh, a corporation, a subpœna, duces tecum, requiring the corporation, at a time and place stated, to produce all of its payroll and work records covering a specified period of time.On the date and at the place designated by the subpœna, representatives of the corporation appeared, but refused to produce the records demanded.

The Secretary of Labor, alleging that: he had cause to believe the corporation was engaged in the production of goods for interstate commerce; he had reasonable grounds to believe that it had been, and was, violating the provisions of §§ 7,11(c),15(a)(2)and15(a)(5) of the Fair Labor Standards Act; an investigation was necessary and appropriate to determine whether said sections of the Act were being violated; and the records required to be produced by the subpœna were relevant, material and appropriate to such investigation and would aid in the enforcement of the provisions of the Act, instituted this action under § 49,U.S.C.A., Title 15, seeking an order of the Court to compel the corporation to comply with the subpœna and to produce the records.In answer to this petition, the corporation denied that it or its employees were engaged in the production of goods for interstate commerce, and alleged that they were engaged in work of an essentially local nature and for that reason were not within the coverage of the Act, supra.It also alleged that the petitioner was not entitled to enforcement of the subpœna because he was engaged in a mere "fishing expedition", unwarranted in fact and in law.There were no allegations that the subpœna made unreasonable demands or that compliance therewith would be unreasonably burdensome, or would result in undue hardship.Thus, the only issue joined by the pleadings was whether or not the corporation and its employees were subject to the provisions of the Act, supra.

The Court held that it had jurisdiction to inquire into question of coverage in a proceeding to enforce the demands of a subpœna, and, upon the evidence adduced at the hearing, held that the corporation and its employees were not within the scope of the coverage of the Fair Labor Standards Act.This appeal is from the final order of the Court denying the relief sought by the Secretary.

The first contention urged for reversal is that the District Court erred in holding that judicial enforcement of the subpœna duces tecum was dependent upon a prior adjudication that the employees of the employer sought to be investigated are within the coverage of the Act.This is not a novel issue, but is one which we have previously considered.Mississippi Road Supply Co. v. Walling, 5 Cir., 136 F.2d 391;Holloway Gravel Co. v. McComb, 5 Cir., 174 F.2d 421, 422.In the last cited casewe expressly refrained from deciding whether the question of coverage was a proper subject for determination on application for enforcement of a subpœna duces tecum, but held that in the absence of a clear showing of unreasonableness or gross abuse of the administrative investigative function, the Courts will not interfere with an investigation "merely in order to render an anticipatory judgment on the merits."In Endicott Johnson Corp. v. Perkins, 317 U.S. 501, 63 S.Ct. 339, 87 L. Ed. 424, the Supreme Court held that the Secretary of Labor was entitled to enforcement of her subpœna duces tecum issued pursuant to, and in aid of, her investigative duties under the Walsh-Healey Public Contracts Act,¹ and that the District Court was not authorized to decide the question of coverage in the enforcement proceeding.Expressing the view that "Congress has authorized the Administrator of the Wage and Hour Division, Department of Labor, rather than the District Court in the first instance, to determine the question of coverage in the preliminary investigation of possibly existing violations", the Supreme Court, in Oklahoma Press Publishing Co. v. Walling, 327 U.S. 186, 66 S.Ct. 494, 508, 90 L.Ed. 614, held that the Administrator is entitled to enforcement of a subpœna duces tecum, issued in aid of his investigative duties and designed to facilitate his determination of whether provisions of the Fair Labor Standards Act were being violated, without a prior adjudication that the industry sought to be investigated is subject to the provisions of the Act.

These authorities are determinative of the question presented, unless, as contended by appellee, they were abrogated by § 6(c) of the Administrative Procedure Act,60 Stat. 237,5 U.S.C.A. § 1005(c), which was enacted four months after the opinion in Oklahoma Press Publishing Co., supra, was rendered by the Supreme Court.²In so urging, appellee recognizes that this Court, in D. G. Bland Lumber Co. v. N. L. R. B., 5 Cir., 177 F.2d 555, 558,³ held that in enacting the Administrative Procedure Act, "Congress intended to leave the scope of judicial inquiry unchanged upon an application for the enforcement of a subpœna", and that § 6(c) of that Act enacted into statutory law the rule laid down by the Supreme Court in Endicott Johnson Corp. v. Perkins, supra.It is contended, however, that the Blandcase, supra, is distinguishable from the present case, or, in the event it is not, the Court failed to properly consider and give effect to the legislative history of the Administrative Procedure Act, as it relates to judicial enforcement of administrative agency subpœnas, in deciding the Bland case, and should, upon reconsideration, overrule that holding.

Section 6(c) of the Administrative Procedure Act⁴ provides that in the event of contest the court shall enforce any subpœna issued by an administrative agency to the extent that it is found to be "in accordance with law".Appellee urges that the phrase "in accordance with law" connotes that the court has jurisdiction, in an action to enforce the requirements of a subpœna, to determine whether the person and the subject matter to which the subpœna is directed are within the jurisdiction of the agency, and in so doing, may adjudicate the issue of coverage.As we observed in the Bland case, as originally introduced, § 6(c) contained a provision⁵ which would have made the jurisdiction of the agency a litigable issue in subpœna enforcement proceedings.Upon consideration, this provision was omitted and the term "in accordance with law" was inserted.We cannot assume that this deliberate substitution of language in view of the existing law,⁶ was not intended to define with exactness the limits of inquiry in judicial enforcement proceedings.The reports of both the Senate⁷ and the House⁸ Judiciary Committee sustain this view.

It is true that certain excerpts from Senate Document No. 248, s...