Chapman v. Home Ice Co. of Memphis

Decision Date01 June 1943
Docket NumberNo. 9266.,9266.
Citation136 F.2d 353
PartiesCHAPMAN et al. v. HOME ICE CO. OF MEMPHIS et al.
CourtU.S. Court of Appeals — Sixth Circuit

John H. Franklin, of Memphis, Tenn., (John H. Franklin and A. A. Aspero, both of Memphis, Tenn., on the brief), for appellants.

Julian C. Wilson, of Memphis, Tenn. (Julian C. Wilson and Bertrand W. Cohn, both of Memphis, Tenn., on the brief), for appellee.

Irving J. Levy, of Washington, D. C., and Jeter S. Ray, of Nashville, Tenn., for amicus curiae, L. Metcalfe Walling, Administrator of the Wage and Hour Division, Department of Labor.

Before HICKS, SIMONS, and ALLEN, Circuit Judges.

SIMONS, Circuit Judge.

The issue in this appeal involves the coverage of the Fair Labor Standards Act of June 25, 1938, 29 U.S.C.A. § 201 et seq., and relates specifically to the employees of a Tennessee company producing ice of which a substantial portion is sold to railroad companies and merchants for refrigeration of perishable commodities moving in interstate commerce, and for refreshment of passengers on interstate trains. The District Court concluded that the work of the plaintiffs in producing such ice was local in its nature and not within the scope of the Act, and so dismissed the suit. From its judgment the plaintiffs appeal.

The court found that the appellee had, since April 17, 1939, operated a number of ice plants in the city of Memphis, manufacturing ice which it sold and delivered in Memphis and Shelby Counties, Tennessee, and that during the time covered by the law it had manufactured and sold 121,846 tons. Of this ice the greater part was sold and delivered from the appellee's platforms at retail, though it also does a wholesale business, selling to peddlers who resell over various routes in Memphis. In addition to these sales, however, the defendant, during the period, sold 1,404 tons which it placed in crushed form in refrigerator cars for preserving shipments of perishable commodities moving to other states; 2,605 tons to interstate railroads for the cooling of passenger cars; and 4,283 tons to Memphis merchants for refrigeration of poultry, meats, and fruits shipped by them in interstate commerce. This tonnage included so-called "white ice," a by-product, not intentionally produced and not ordinarily merchantable but useful in car icing. The plaintiffs contended that under the proofs their employment in the manufacture and delivery of ice, which included ice that went to the railroads for refrigeration of cars, classified them as being engaged in commerce or in the production of goods for commerce. The defendant urged that, since all of its ice was manufactured, sold, delivered, and paid for in Memphis, its business is wholly local in its nature and so an activity not covered by §§ 6 and 7 of the Act.

The court, in a well-developed and painstaking opinion, 43 F.Supp. 424, undertook to consider the meaning and scope of the phrase "in commerce or in the production of goods for commerce," and concluded that the Fair Labor Standards Act is limited in its coverage to those employees who are engaged in commerce per se, or are engaged in the production and handling of goods and merchandise which are intended for sale or for distribution in the business world and across state lines; that the Act did not, as did the National Labor Relations Act, 29 U.S.C.A. § 160 et seq., and other statutes, intend to reach employees in all activities which affect interstate commerce, but only in those which were directly in commerce. Conceding that there may be no shipment of perishable merchandise unless ice is used, and that such icing has a necessary effect upon commerce, it held the defendant's production to be engagement neither in commerce nor in the production of goods for commerce. Producing goods to be sold and delivered to railroads merely to aid them in transporting other goods was but an incidental factor in the operation of the transportation business, and Congress, by the limitations in the Act, had sought not to invade the province of the states in the regulation of wages and hours so as to include indiscriminately the local activities of the people therein.

It is necessary to observe that when the case was decided to wit: January 27, 1942, the court was without the aid of the decisions of the Supreme Court which since have given to the terms of the Fair Labor Standards Act the broad and liberal connotation held to be in consonance with its clearly perceived purpose, A. B. Kirschbaum Co. v. Walling, 316 U.S. 517, 62 S.Ct. 1116, 86 L.Ed. 1638; Warren-Bradshaw Drilling Co. v. Hall, 317 U.S. 88, 63 S.Ct. 125, 87 L.Ed. ___; Walling v. Jacksonville Paper Co., 317 U.S. 564, 63 S.Ct. 332, 87 L.Ed. ___, decided January 18, 1943; nor were there available to it the later decisions of the Circuit Court of Appeals in Hamlet Ice Co. v. Fleming, 4 Cir., 127 F.2d 165, and Atlantic Co. v. Walling, 5 Cir., 131 F. 2d 518, affirming Fleming v. Atlantic Co., D.C., 40 F.Supp. 654, both dealing with activities of the character of those here involved. In Kirschbaum v. Walling, supra 316 U.S. 517, 62 S.Ct. 1121, 86 L. Ed. 1638, employees were held to be engaged in occupations "necessary to the production" of goods for commerce by tenants in a loft building, upon the rationalization that without light and heat and power the tenants could not engage as they do in the production of goods for interstate commerce, and that the normal and spontaneous meaning of the language by which Congress defined in § 3(j) the class of persons within the benefits of the Act, to wit: employees...

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    ...L.Ed. 1638; Warren-Bradshaw Drilling Co. v. Hall, 63 S.Ct. 125, 87 L.Ed. 99; Overstreet v. North Shore Corp., 87 L.Ed. 423; Chapman v. Home Ice Co., 136 F.2d 353; Womach v. Consolidated Timber Co., supra; Walling v. Packing Co., supra; Holland v. Amoskeag Machine Co., 44 F.Supp. 884. John H......
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