Bowles v. Glick Bros. Lumber Co.

• Decision Date: 26 March 1945
• Docket Number: No. 10664.,10664.
• Citation: 146 F.2d 566
• Parties: BOWLES, Adm'r, Office of Price Administration, v. GLICK BROS. LUMBER CO. et al.
• Court: U.S. Court of Appeals — Ninth Circuit

146 F.2d 566 (1945)

BOWLES, Adm'r, Office of Price Administration, v. GLICK BROS. LUMBER CO. et al.

No. 10664.

Circuit Court of Appeals, Ninth Circuit.

January 4, 1945.

Rehearing Denied March 26, 1945.

Thomas I. Emerson, Deputy Adm'r for Enforcement, Fleming James, Jr., Director, Litigation Division, David London, Chief, Appellate Branch, Albert Dreyer, Atty., OPA, all of Washington, D. C., W. Dunlap Cannon, Jr., Regional Litigation Atty., of San Francisco, Cal., and H. Eugene Breitenbach, Dist. Enforcement Atty., OPA, of Los Angeles, Cal., for appellant.

Morris Lavine, of Los Angeles, Cal., for appellees.

Morgan J. Doyle, of San Francisco, Cal., as amicus curiae.

Before WILBUR, DENMAN, and HEALY, Circuit Judges.

HEALY, Circuit Judge.

The Administrator of the Emergency Price Control Act of 1942, 50 U.S.C.A. Appendix, § 901 et seq., appeals from a judgment of dismissal of a suit brought in October, 1943, under § 205(e) of the Act. The appeal involves, also, an interlocutory order suppressing evidence obtained by OPA investigators preliminary to the institution of the suit.

Defendant Glick Brothers Lumber Company is a California corporation. The remaining defendants are its stockholders. Two counts of the complaint alleged that during the year ending September 30, 1943 the defendants sold lumber at wholesale at prices in excess of those permitted by the General Maximum Price Regulation. A third count alleged the wholesaling of lumber during the same period at prices in excess of those permitted by Regulation No. 215. It was averred that none of the lumber was purchased by the buyers for use or consumption other than in the course of trade or business. Judgment was asked in the sum of $34,695.18, being treble the amount by which the prices charged exceeded the maximum prices permissible.

1. Briefly summarized, the grounds announced by the court for sustaining defendants' motion to dismiss were that the Administrator is not empowered to maintain the suit; that the complaint is not sufficiently definite to inform the defendants of the facts constituting the basis of the Administrator's claim; and that the evidence upon which the action is based was obtained in violation of the Fourth and Fifth Amendments to the Constitution of the United States.

Indefiniteness of the complaint is not a ground for dismissal. If a defendant needs additional information to enable him to answer or prepare for trial the procedure provided by the Federal Rules is a motion for a more definite statement or for a bill of particulars, consult Rule 12(e), 28 U.S.C.A. following section 723c. Nor, in a civil action, does illegality of the means by which evidence has been procured afford grounds for a motion to dismiss. The defenses which may be interposed by motion are confined to those enumerated in Rule 12(b).

The trial court was of opinion that under § 205(e) of the Act the right to bring suit for damages against one regularly engaged in business "is exclusively the right of the individual or concern having to pay the overcharge, and the Administrator has no right to sue in such instance but is limited in his right to bring actions for treble damages to suits against black market operators and bootleggers and others not regularly engaged in business." The court conceded that this view "may not be consistent with the strict words of the section," but it believed that the construction "saves the statute from invalidity."

We think the Administrator was entitled to maintain the suit. Section 205 (e) of the 1942 Act, so far as here pertinent, reads: "If any person selling a commodity violates a regulation, order, or price schedule prescribing a maximum price or maximum prices, the person who buys such commodity for use or consumption other than in the course of trade or business may bring an action either for $50 or for treble the amount by which the consideration exceeded the applicable maximum price, whichever is the greater, plus reasonable attorney's fees and costs as determined by the court. * * * If any person selling a commodity violates a regulation, order, or price schedule prescribing a maximum price or maximum prices, and the buyer is not entitled to bring suit or action under this subsection, the Administrator may bring such action under this subsection on behalf of the United States." (Emphasis supplied.)

The Section is to be read in conjunction with § 4(a). The latter makes it unlawful for any person to sell, or in the course of trade or business to buy a commodity for a price in violation of any regulation or price schedule, that is to say, the buyer in the course of trade or business is deemed by the statute to be in pari delicto with the seller. But one who buys for use or consumption other than in the course of trade or business — the ordinary non-commercial consumer — is not declared a violator. He is apparently thought to possess no choice in the matter. Hence he is the only member of the buying public empowered under § 205(e) to bring suit for treble damages. In all other cases the right vests in the Administrator for the use and benefit of the Nation as a whole.¹

Such is the legislative policy charted by the statute with reasonable clarity. That the phrase "trade or business" was intended by Congress to carry the meaning here ascribed to it is amply borne out by the legislative history of the Act.² Senate Report 931, p. 8 (77th Cong., 2d Sess.), states that § 205(e) "will permit private purchasers who buy for personal use or consumption rather than in the course or trade or business, to protect themselves against violations of the Act." Again, on p. 26 of the Senate Report it is said that "if a buyer, whose seller has violated a maximum price regulation or price schedule is not entitled to bring such action, because he is a buyer in the course of trade or business, or for other reasons the Administrator may bring such action against the seller on behalf of the United States." The Senate draft of § 205(e) was not changed in Conference, and was enacted as it originally stood. The Conference Report (No. 1658) states at p. 26 that "non-commercial consumers might institute treble damage suits."

2. We consider now the order suppressing the evidence.

The motion to suppress (supported by affidavits of several officers and employees of the Lumber Company) was grounded in the claim that the evidence had been obtained by an unlawful search and seizure. Affidavits of the investigators of the Office of Price Administration were interposed in opposition to the motion. Although the investigators were present in court and the Administrator several times suggested that they be heard orally, the court declined to consider anything other than the affidavits. It adopted as true the contents of those submitted on behalf of the defendants.

While for the most part the affidavits are in sharp conflict, the following facts are substantially undisputed: On June 1, 1943, Christiansen and Vettel, the OPA investigators, called at the Lumber Company's place of business, displayed their credentials, and asked permission of the general manager, Max Glick, to inspect the invoices. The invoices were made available and a room in the building was assigned to the investigators in which to conduct the examination. The inspection continued during the period from June 1 to June 15, and from July 26 to August 15, 1943. There were thereafter a few sporadic visits up until September 15. No objection was made to the examination of invoices until August 13, on which date the defendants served on the investigators and and on the Office of Price Administration a notice objecting to the investigation as an illegal search and seizure.³ Up until that time, from all accounts, the inspection appears to have been conducted with the acquiescence of the defendants. On one phase only is there disagreement. Certain invoices and delivery slips, said to contain alterations and interlineations which could not be accurately shown by the ordinary process of copying, were taken out of the building and photostatic copies made of them. The originals were customarily returned promptly thereafter. The defendants assert that the removal and photo-stating was done without their knowledge or consent. However, the investigators state that these photostatic copies were produced and discussed in detail at conferences held from time to time with the defendants and their counsel and no objections were raised as to the fact or manner of their procurement.

The investigators say that leave to inspect invoices was freely given and that the relations between themselves and the defendants were at all times friendly and cooperative. This the defendants deny. Their affidavits are to the effect that the invoices were made available only because the defendants were told by the investigators that things would otherwise be made "awfully tough" for them, and because they — the defendants — were "inspired by fear and apprehension of the great and almost unlimited power of the Office of Price Administration and of its officers and agents." Defendants thought they were under compulsion and feared that "serious and dire consequences" would ensue if they failed to permit the requested examination.

In large measure the affidavits relate, not to the inspection itself, but to a series of interviews had between the defendants and their representatives on the one hand and representatives of the Office of Price Administration on the other. All these took place during the progress of the investigation. From the time of the first conference the defendants were represented by counsel. During the conferences, it is asserted, the representatives of the OPA conducted themselves in a high handed manner, demanding sums varying from $25,000 to $90,000 on account of alleged liability of the defendants for violations of the Act.⁴ These demands, along with the intimidating attitude of the OPA...