Carolene Products Co. v. Harter

• Decision Date: 31 January 1938
• Docket Number: 4
• Citation: 329 Pa. 49,197 A. 627
• Parties: Carolene Products Company, Appellant, v. Harter et al
• Court: Pennsylvania Supreme Court

197 A. 627

Carolene Products Company, Appellant, v. Harter et al

329 Pa. 49

No. 4

Supreme Court of Pennsylvania

January 31, 1938

Argued November 29, 1937

Appeal, No. 4, May T., 1938, from decree of C.P. Dauphin Co No. 199 Commonwealth Docket, 1936, in case of Carolene Products Company v. Elmer E. Harter, Jr., et al. Decree affirmed.

Bill in equity. Before HARGEST, P.J., WICKERSHAM and FOX, JJ.

The opinion of the Supreme Court states the facts.

Decree entered dismissing bill. Plaintiff appealed.

Errors assigned, among others, were overruling of exceptions to chancellor's findings and conclusions.

Decree affirmed; costs to be paid by appellant.

George N. Murdock, with him Sterling McNees, of McNees, Hollinger &amp Nurick, for appellant.

Harry Polikoff, Deputy Attorney General, with him Charles J. Margiotti, Attorney General, for appellees.

A. Evans Kephart, for interested parties, under Rule 61.

Morris Duane, with him Roland S. Morris, of Duane, Morris & Heckscher, for interested party, under Rule 61.

Before SCHAFFER, MAXEY, DREW, LINN, STERN and BARNES, JJ.

OPINION

MR. JUSTICE STERN:

This is an appeal from the refusal of the court below to enjoin defendants from seeking to prevent the sale in Pennsylvania of a product marketed by plaintiff.

Plaintiff is a corporation of the State of Michigan, and sells, under the trade names of "Carolene" and "Milnut," a food compound which is manufactured for it at Litchfield, Illinois, and Warsaw, Indiana. This product is made by evaporating skimmed milk (that is, whole milk from which the butterfat has been removed ^[1]), thus reducing it to its constituent solids, and then adding a certain percentage of cocoanut oil. It is sold in hermetically sealed tin cans, each bearing a label which truthfully describes the product as "A compound of refined nut oils and evaporated skimmed milk," and states that it is "Especially prepared for use in coffee, baking and for other culinary purposes," and is "not to be sold for evaporated milk." Of course, the cocoanut oil is much cheaper than the butterfat which it replaces, and therefore plaintiff's product can be, and is, sold at a lower price than ordinary evaporated or condensed milk.

When plaintiff attempted to sell "Carolene" and "Milnut" in Pennsylvania, defendants, acting for the Department of Agriculture of the Commonwealth, gave notice that such sales constituted a violation of the laws of the State, and should be discontinued under penalty of criminal prosecution.

The Act of March 21, 1923, P.L. 28, entitled, "For the prevention of fraud and the protection of the public health; relating to milk, cream, or skimmed milk, . . . prohibiting the introduction of foreign fats into them . . .," provides, section 3, that "It shall be unlawful . . . to manufacture, sell . . . or have in possession with intent to sell . . . any milk, cream, or skimmed milk, whether or not condensed, evaporated, concentrated, powdered, dried, or desiccated, to or with which has been added, blended, or compounded any fats or oils, other than milk fats, either under the name of said products or articles or the derivatives thereof, or if labeled under any fictitious, coined, or trade names whatsoever: . . ."

The Act of June 29, 1923, P.L. 929, a supplement to the preceding act, provides, section 2, that: "It is unlawful . . . to manufacture, sell, . . . or have in possession with intent to sell . . . any condensed, concentrated, or evaporated skimmed milk, or any compound of any kind containing skimmed milk, . . . in hermetically sealed cans or receptacles, unless such can or receptacle shall contain at least five pounds net weight, and shall have plainly marked, printed, or indicated thereon the words, 'Concentrated Skimmed Milk, . . .' and immediately thereunder the words 'Unfit For Infants,' which required words shall be printed in dark block type at least one-half inch in height and one-half inch in width upon a light colored background, . . . It is unlawful . . . to manufacture, or sell . . . or have in possession with intent to sell . . . any condensed, concentrated, or evaporated skimmed milk labeled under any fictitious or coined or trade name whatsoever."

It will be noted that whereas the March statute prohibited entirely the sale of "filled milk," the June act is merely regulatory, and permits the sale of skimmed milk compounds if packed in hermetically sealed cans with a specified minimum content and label. It is plaintiff's contention that both acts violate the Fourteenth Amendment of the Constitution of the United States in that they deprive plaintiff of its property without due process of law, and discriminate against its product by permitting the manufacture and sale of other articles containing the same ingredients. It asserts that "Carolene" or "Milnut" is wholesome, and in no way harmful to public health, and that the provisions limiting its sale to certain sized cans with prescribed labels are arbitrary and unreasonable and bear no logical relation to the public welfare.

According to the findings of fact by the court below, all of which are amply supported by the evidence, it appears that filled milk, while not deleterious, does not have the nutritive value of whole milk, because butterfat, which filled milk lacks, is rich in vitamin A and forms one of the most desirable and even vital constituents of natural milk; that although plaintiff does not, either by its labels or sales propaganda, misrepresent its product, confusion and deception arise from the fact that it cannot be distinguished from evaporated milk in taste, odor, appearance or consistency; that frequently retail grocers and markets advertise and sell "Carolene" and "Milnut" as milk, or evaporated or canned milk, not revealing that it is merely a skimmed milk compound; that even the Babcock test, which is the standard method for determining the fat content of milk, does not reveal the presence of cocoa fat as distinguished from butterfat, since it reacts similarly to both, and nothing but a chemical analysis can disclose the substitution; that plaintiff's product is packed in cans similar to those in which condensed milk is sold, and an unwary purchaser who does not carefully read the label, or make pointed inquiry, is quite apt to purchase the skimmed milk compound in the belief that it is the same as evaporated milk.

The facts thus established make the case analogous to that which presented itself to this court and to the Supreme Court of the United States in Powell v. Commonwealth, 114 Pa. 265, affirmed in Powell v. Pennsylvania, 127 U.S. 678. It was there held that the State could prohibit the manufacture and sale of oleomargarine even though that product was not injurious. ^[2] The Supreme Court of Pennsylvania said (p. 295): "The test of the reasonableness of a police regulation prohibiting the making and vending of a particular article of food, is not alone whether it is unwholesome and injurious. If an article of food is of such a character that few persons will eat it knowing its real character; if, at the same time, it is of such a nature that it can be imposed upon the public as an article of food which is in common use, and against which there is no prejudice; and if, in addition to this, there is probable ground for believing that the only way to prevent the public from being defrauded into the purchasing of the counterfeit article for the genuine is to prohibit altogether the manufacture and sale of the former, -- then we think such a prohibition may stand as a reasonable police regulation, although the article prohibited is in fact innocuous, and although its production might be found beneficial to the public, if in buying it they could distinguish it from the production of which it is the imitation." In the United States Supreme Court it was said (p. 685): "Whether the manufacture of oleomargarine, or imitation butter, . . . is, or may be, conducted in such a way, . . . as to baffle ordinary inspection, or whether it involves such danger to the public health as to require, for the protection of the people, the entire suppression of the business, rather than its regulation in such manner as to permit the manufacture and sale of articles of that class that do not contain noxious ingredients, are questions of fact and of public policy which belong to the legislative department to determine."

In Hebe Company v. Shaw, 248 U.S. 297, the validity of an Ohio statute was sustained which forbade the sale of condensed skimmed milk. The court said it was immaterial that "Hebe," which, like "Carolene," was made by the addition of cocoanut oil, was wholesome; that the intention of the act being to secure a certain minimum of nutritive elements and to protect the public from "the fraudulent substitution of an inferior product that would be hard to detect," it was for the legislature to exercise its own judgment as to the extent to which it should go in accomplishing that objective, short only of arbitrary or unreasonable exercise of the power; ^[3] and that the addition of the cocoanut oil to the skimmed milk made the resulting compound all the more available as a fraudulent substitute for the dearer and better article.

Some of the state courts have invalidated acts prohibiting the manufacture or sale of filled milk People v. Carolene Products Co., 345 Ill. 166, 177 N.E. 698; Carolene Products Co. v. Thomson, 276 Mich. 172, 267 N.W. 608; Carolene Products Co. v. Banning, 131 Neb. 429, 268 N.W. 313; Carolene Products Co. v. McLaughlin, 365 Ill. 62, 5 N.E.2d 447. On the other hand, such an act was declared constitutional in State v. Emery, 178 Wis. 147, 189 N.W. 564 (see, however, John F. Jelke Co. v. Emery, 193 Wis. 311, 214 N.W. 369). The...