C.A. Weed & Co. v. Lockwood

• Decision Date: 26 May 1920
• Docket Number: 245.
• Citation: 266 F. 785
• Court: U.S. Court of Appeals — Second Circuit
• Parties: C. A. WEED & CO. v. LOCKWOOD, U.S. Atty.

266 F. 785

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

No. 245.

United States Court of Appeals, Second Circuit.

May 26, 1920

Edward L. Jellinek and Simon Fleischmann, both of Buffalo, N.Y., for appellant.

Daniel J. Kenefick, Louis E. Desbecker, and Almon W. Lytle, all of Buffalo, N.Y., for Buffalo Retail Merchants' Ass'n James O. Moore and Emil Rubenstein, both of Buffalo, N.Y for Reliable Credit Clothing Co.; John W. Ryan and Merritt N Baker, both of Buffalo, N.Y., for Buffalo Shirt Co.; Lyman M Bass, of Buffalo, N.Y., for Hens & Kelly; Eugene Warner, of Buffalo, N.Y., for Antwerp Diamond Co.; Irving L. Fisk, of Buffalo, N.Y., for Sultzbach Clothing Co., Inc.; and Charles E. Hughes, of New York City, for National Ass'n of Clothiers and National Retail Dry Goods Dealers' Ass'n-- as amici curiae.

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

Before WARD, HOUGH, and MANTON, Circuit Judges.

MANTON Circuit Judge.

The grand jury for the Western district of New York returned an indictment against the appellant on the 9th day of March, 1920, charging the appellant, in 20 counts, with a violation of the act of Congress as amended on October 22, 1919, commonly referred to as the Lever Act. This bill in equity has been filed seeking to restrain the United States attorney for the Western district of New York from proceeding in the criminal action. A motion was made for an injunction restraining the United States attorney pending final hearing. The government opposed the application and contended for a dismissal of the bill. From a denial of plaintiff's motion for an interlocutory order, this appeal is taken.

The right to maintain this action in equity to restrain the United States attorney in a criminal prosecution is challenged. The constitutionality of the act is involved. In addition thereto, the property rights and the reputation of the appellant are involved. The claim is that, if the act be held to be unconstitutional, the appellant will be deprived of its property without due or any process of law, will suffer repeated harassment, and may be subject to a multiplicity of prosecutions. It would suffer a great monetary loss, its reputation would be greatly impaired, and its good will and business, which it now owns possesses, and has enjoyed, will be greatly impaired, if not entirely destroyed, and thus irreparable damage will be done to it. We think that, if the appellant is right in its contention that the act is unconstitutional, it may maintain this action in equity. This court said in Jacob Hoffman Brewing Co. v. McElligott et al., 259 F. 525, 170 C.C.A. 487:

'A suit in equity to enjoin the United States attorney from instituting criminal proceedings under a statute of the United States is manifestly a suit against the United States. * * * If property rights are invaded, and the statute in question is unconstitutional, it is void, is to be treated as nonexistent, and so no defense to the United States attorney. When instituting criminal proceedings under it, he is to be regarded, not as representing the United States in his official capacity, but as acting individually.'

In Wilson, etc., v. New et al., 243 U.S. 332, 37 Sup.Ct. 298, 61 L.Ed. 755, L.R.A. 1917E, 938, Ann. Cas. 1918A, 1024, an action, similar in form, was commenced against the United States attorney for the Western district of Missouri. The district court held that the so-called Eight-Hour Railroad Law (Comp. St. Secs. 8680a-8680d) was unconstitutional, but the Supreme Court reversed the decree on the ground that the law was constitutional, and dismissed the bill. In the later case of Hammer v. Dagenhart, 247 U.S. 251, 38 Sup.Ct. 529, 62 L.Ed. 1101, 3 A.L.R. 649, Ann. Cas. 1918C, 724, in contesting the constitutionality of an act of Congress involving child labor, the same procedure was followed. The Supreme Court, in both cases, considered the merits of the claim of questioned constitutionality as to each act, and, while it did not in express words approve the procedure, it did necessarily approve it, by considering the merits of the issues raised.

The majority of the court are of the opinion that a direct injury to the property of the appellant here would follow if the law were declared unconstitutional, and that, if such were the case, it might maintain this action in equity. But we are of the opinion that the act of Congress does not contravene any of the constitutional provisions, and therefore this action cannot be successfully maintained. Act Aug. 10, 1917, c. 53, Sec. 4, as amended by Act Oct. 22, 1919, Sec. 2, reads as follows:

'That it is hereby made unlawful for any person willfully * * * to make any unjust or unreasonable rate or charge in handling or dealing in or with any necessaries. * * * Any person violating any of the provisions of this section upon conviction thereof shall be fined not exceeding $5,000 or be imprisoned for not more than two years, or both: Provided, that this section shall not apply to any farmer, gardener, horticulturist, vineyardist, planter, ranchman, dairyman, stockman, or other agriculturist, with respect to the farm products produced or raised upon land owned, leased, or cultivated by him: Provided further, that nothing in this act shall be construed to forbid or make unlawful collective bargaining by any co-operative association or other association of farmers, dairymen, gardeners, or other producers of farm products with respect to the farm products produced or raised by its members upon land owned, leased, or cultivated by them.'

The amendment of October 22, 1919, included in the act, among the necessaries described, wearing apparel. Section 4 of the August 10, 1917, act provided no penalty, and an infraction or violation, we held, was no criminal offense. Mossew v. United States (C.C.A.) 266 F. 18, decided May 19, 1920. The amendment, however, provides a penalty, and after October 22, 1919, a violation of the act constitutes a criminal offense against the United States.

The first section of the Act of October 22, 1919, refers to it as the Food Control Act. An emergency for legislation of this character, which makes the statute in question a war measure, has been held by the Supreme Court to still exist. Hamilton v. Kentucky Dis. Co., 251 U.S. 160, 40 Sup.Ct. 106, 64 L.Ed. . . . . The passage of this act by Congress and the failure of the Senate to ratify the peace treaty with the German government, indicates that Congress treats the war as continuing and demobilization as incomplete. It must be said that this act, passed by Congress and approved by the President, indicated an intention to support the army and navy, as well as provide a remedy for the evils resulting from the war, so that there may be an equitable distribution of such necessaries as the country has, until the natural scarcity by lack of production and the extraordinary foreign demands, and other causes which depress normal competition, shall have subsided, at least during the period while we are still at war. The purpose of the act, given in section 1, is to assure an adequate supply and equitable distribution of wearing apparel. In Stewart v. Kahn, 11 Wall. 493, 20 L.Ed. 176, the Supreme Court said:

' * * * The power is not limited to victories in the field and the dispersion of the insurgent forces. It carries with it inherently the power to guard against the immediate renewal of the conflict, and to remedy the evils which have arisen from its rise and progress.'

Since we are still in a state of war, and the war time emergency has not expired, we are of the opinion that Congress could legislate, as it did, under the authority of its war powers, without contravening article 1, Sec. 8, cl. 18, of the Constitution. During the recent war, the struggle between economic resources was all important. It did much to make for the morale of the army and navy. Food control, as a subject of war legislation, has been approved. Hamilton v. Kentucky Dis. Co., supra. Wearing apparel, declared to be one of the necessaries, is well within this sphere of legislation. To so legislate does not interfere with the police powers of the state. Food and wearing apparel control, during a war emergency, are properly the subject for war legislation, and by limiting charges for such necessaries Congress does not take property without due process of law. Munn v. Illinois, 94 U.S. 113, 24 L.Ed. 79. The court, speaking through Chief Justice Waite, there said:

'In their exercise it has been customary in England from time immemorial, and in this country from its first colonization, 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.'

Thus it will be observed that the Supreme Court pointed out that the state may fix prices on all commodities where the public has an interest. We think that, while a state of war exists, Congress may declare that the public interest in the price of food and wearing apparel warrants legislation declaring an unreasonable and unjust rate or charge in handling or dealing in the necessaries.

But the appellant attacks the validity of the act, saying that it is too vague and indefinite to constitute a valid definition of crime.

The enactment is said to be in contravention of Amendments 5 and 6 of the Constitution. It is said to be in violation of Amendment 6, which provides that in all criminal prosecutions the accused shall enjoy the right to be informed of the nature and cause of the accusation, and of Amendment 5, in that it deprives dealers in wearing apparel of property and liberty without due...