C.A. Weed & Co. v. Lockwood

• Decision Date: 01 May 1920
• Docket Number: 287B; Cr. 2065.,Eq. 285B,286B,
• Citation: 264 F. 453
• Parties: C. A. WEED & CO. v. LOCKWOOD, U.S. Atty. UNITED STATES v. RELIABLE CREDIT CLOTHING CO., Inc.
• Court: U.S. District Court — Western District of New York

264 F. 453

C. A. WEED & CO. v. LOCKWOOD, U.S. Atty.

UNITED STATES v. RELIABLE CREDIT CLOTHING CO., Inc.

Eq. Nos. 285B, 286B,, 287B; Cr. No. 2065.

United States District Court, W.D. New York.

May 1, 1920

Stephen T. Lockwood, U.S. Atty., of Buffalo, N.Y., and Carl Sherman Asst. U.S. Atty., of Buffalo, N.Y.

Simon Fleischman, of Buffalo, N.Y. (Irving L. Fisk, Louis E Desbecker and Edward L. Jellinek, all of Buffalo, N.Y., on the briefs), for C. A. Weed & Co.

Emil Rubenstein, of Buffalo, N.Y. (James O. Moore, of Buffalo N.Y., of counsel), for Reliable Credit Clothing Co., Inc.

HAZEL District Judge.

Indictments have been returned at this term of court against the above-named complainants, alleging violations of section 2 of the Lever Act as amended October 22, 1919 (41 Stat. 297, c 80), and separate suits in equity were thereafter brought by certain of the defendants to enjoin the United States attorney from proceeding in the criminal actions pending final hearing. A rule to show cause was granted, which has now been heard; the government appearing and contending for a dismissal of the bill and opposing any stay.

In United States v. Reliable Credit Clothing Company, Incorporated, the defendant has demurred to the indictment. These four cases, involving substantially the same questions as to the validity of the indictment, have been heard together, and a single opinion covering them will suffice.

Section 2 of the Lever Act, which is an amendment of section 4 of the original Act of August 10, 1917, makes it unlawful for 'any person willfully * * * to make any unjust or unreasonable rate or charge in handling or dealing in or with any necessaries,' and the contention of the defendants, who are dealers in wearing apparel, is in the main that this provision of the act is unconstitutional; that it takes property for public use without just compensation, in violation of the Fifth Amendment of the Constitution of the United States; that the indictment is vague and indefinite, and accordingly repugnant to the Sixth Amendment; and, finally, that the President has not fixed a standard of prices to be charged for the articles. These objections are of vital importance.

When the original bill was debated in Congress, it was designated as an 'emergency war measure,' and inasmuch as it has been decided in Hamilton v. Kentucky Distilling Co., 251 U.S. 160, 40 Sup.Ct. 106, 64 L.Ed. . . ., that the war must technically be regarded as continuing until demobilization is complete, and until the President has proclaimed an end of the war, the power of Congress to prevent by appropriate legislation the evils of greed and profiteering, specified in the indictment, must be upheld.

It is a general rule that every statute is presumed to have been passed under the sanction of constitutional authority, and its unconstitutionality should not be declared unless it is clearly so. If there is doubt in the mind of the court, the expressed will of the Legislature should be sustained. From my examination of the decisions to which attention was drawn in argument I conclude that the provision in question was a constitutional enactment, and was and is a valid exercise of legislative power. It is not repugnant to the Fifth Amendment, since, in my opinion, it imposes no greater limitations than does the Fourteenth Amendment upon state power. Hence it follows that, if a state has the legal right to impose restrictions upon dealers in necessaries under the police power, then concededly a like restriction may be enacted by the national Congress during time of war.

Defendants earnestly contend that the states cannot regulate prices of necessaries, under the Fourteenth Amendment, in times of peace or in times of war or public peril, and indeed there are decisions, Milligan, Ex parte, 4 Wall. 2, 18 L.Ed. 281, and U.S. v. Freight Association, 166 U.S. 319, 17 Sup.Ct. 540, 41 L.Ed. 1007, for example wherein language is used apparently upholding this view. But, conceding that Congress is 'subject to applicable constitutional limitations,' it has nevertheless been decided by the Supreme Court, in Munn v. Illinois, 94 U.S. 113, 24 L.Ed. 77, that a state has power to regulate the conduct of its citizens toward each other, and, whenever necessary for the public welfare, it may determine how property in which the public has an interest may be used. It is true the Supreme Court dealt, in the Munn Case, with a warehouse used for storing grain, regarding which the General Assembly of Illinois had enacted a statute providing, among other things, for elevating rates and charges. It was asserted that the statute was void under the Fourteenth Amendment of the national Constitution, but the Supreme Court affirmed the constitutionality of the act passed by the state assembly, and it was firmly held that, whenever the owner of property devotes the same to a use in which the public is interested, he practically grants to the public an interest in such use, and to the extent of that interest he must submit to be controlled by the public for the common good, as long as he maintains the use. The learned court pointed out that it has always been customary--

'to regulate ferries, common carriers, hackmen, bakers, millers, wharfingers, innkeepers, etc., and in so doing to fix a maximum of charge to be made for services rendered, accommodations furnished, and articles sold.'

In Budd v. N.Y., 143 U.S. 550, 12 Sup.Ct. 468, 36 L.Ed. 247, the Supreme Court strictly adhered to the doctrine enunciated in the Munn Case, and warehousing was regarded as devoting private property to a public use in the same sense, the learned court said, as did a common carrier, miller, ferryman, innkeeper, wharfinger, baker, cartman, or hackney coachman. In Dueber Watch-Case Manufacturing Co. v. E. Howard Watch & Clock Co., 66 F. 637, 14 C.C.A. 14, Judge Lacombe referred to the Munn Case, saying: 'An individual manufacturer or trader may surely buy from or sell to whom he pleases, and may equally refuse to buy from or sell to any one with whom he thinks it will promote his business interests to refuse to trade. That is entirely a matter of his private concern, with which governmental paternalism has not as yet sought to interfere, except when the property he owns is 'devoted to a use in which the public has an interest'; and such public interest in the use has as yet been found to exist only in staple commodities of prime necessity.'

It cannot be doubted that food and wearing apparel are properly defined as necessaries in which the public has an interest. Indeed, such I think was the view of Congress in the use of the word 'necessaries.' The Lever Act does not deprive any one of his property without due process of law, it merely limiting the rate or charge for dealing in or with any necessaries. For the foregoing reasons I am of the opinion that this court ought not to declare unconstitutional the provision to which exception is taken by defendants.

A more serious question, to my mind, is presented by the objection that the provision is void for uncertainty. Its indefiniteness was recognized in the debate of the Senate and Senator Hoke Smith directed...