Dairy Queen of Wis. v. McDowell

• Decision Date: 08 April 1952
• Citation: 260 Wis. 471,52 N.W.2d 791
• Parties: DAIRY QUEEN OF WISCONSIN, Inc. v. McDOWELL.
• Court: Wisconsin Supreme Court

Page 791

52 N.W.2d 791

260 Wis. 471

DAIRY QUEEN OF WISCONSIN, Inc. v. McDOWELL.

Supreme Court of Wisconsin.

April 8, 1952.

Flynn & Greenquist, Racine, for appellant.

Vernon W. Thomson, Atty. Gen., Richard E. Barrett, Asst. Atty. Gen., for respondent.

George L. Mooney, Plymouth, George M. St. Peter, Fond du Lac, Ela, Christianson & Ela, Madison, amici curiae.

PER CURIAM.

The brief filed on the motion for rehearing by amici curiae is submitted on behalf of several organizations of farmers, and dealers in and manufacturers of dairy products, including an association of about eighty-five Wisconsin manufacturers of ice cream. It opens with a statement of the reason for its filing and there suggests that the effect of the decision is to destroy a generation's work in fixing dairy product standards and the destruction of the reputation of the state acquired by its maintenance of those standards which is of great importance to the economy of the state, urban as well as rural; and that 'maintenance of adequate standards for the protection of consumers is of infinitely greater importance to the entire people of the state than are the economic interests of the promoters of any product or class of products such as 'Dairy Queen."

We should ordinarily hesitate to discuss the effect of the decision upon the economy of the state, for that appears to be a matter peculiarly for the legislature acting within constitutional limitations. We consider, however, that counsels' suggestions regarding that aspect of the case permit, if they do not require, us to respond.

We doubt that Wisconsin's dairy farmers will suffer loss by the introduction into the retail market of a new product which is stipulated to be 'a nourishing, wholesome and healthful food and contains no element deleterious to health,' and which the trial judge observed from demonstration to be 'more tasty and palatable than soft ice cream.' On the contrary, it would seem that the proposal of the plaintiff to engage in business in this state would open a new market and a new demand for the farmer's milk, if for no other reason than that it would provide a substitute containing a lesser amount of fat for those who for various reasons are denied the pleasure of eating ice cream. The argument that the interests of the dairy farmer will be prejudicially affected by this decision is not based on experience or logic.

As to the consumer--the plaintiff offers to sell him a 'nourishing, wholesome and healthful food' which contains no deleterious substance, to be manufactured and sold 'under the supervision and control and in conformity with the rules and regulations for sanitation;' it is so stipulated. It is also stipulated that the product will be advertised to 'indicate that the product being sold is Dairy Queen; that a sign will be posted at all places of sale stating that the product sold is not ice cream or sherbet.' No threat of danger to the public health appears from this proposal. Nor does it appear that the product will be offered to the consumer 'in imitation of ice cream.'

Amici curiae say that 'maintenance of adequate standards for the protection of consumers is of infinitely greater importance to the entire people of the state than are the economic interests of the promoters of any product or class of product such as 'Dairy Queen." To that we agree. We might inquire in response to the suggestion whether it is proper, in the absence of any showing that sale of the product would prejudicially affect either the milk producer or the consuming public, that the legislature or the court should be party to an act which appears to have no purpose except to protect the interests of the eighty-five manufacturers of ice cream who now appear here against the competition of Dairy Queen.

If we must construe sec. 97.025(1), Stats., as meaning that by its enactment the legislature intended absolutely to prohibit the sale of a product such as plaintiff's whether or not it be sold in imitation of ice cream, then we run squarely into the rule of John F. Jelke Co. v. Emery, 1927, 193 Wis. 311, 214 N.W. 369, 371, 53 A.L.R. 463, which, so far as we have been able to find, has not been referred to by either this court or the United States supreme court. Given that construction, the rule of the Jelke case requires that we hold the statute invalid.

In that case the court had for consideration ch. 279, Laws of 1925, an enactment intended to prohibit absolutely the sale of oleomargarine. It purported to make it unlawful to manufacture, sell or expose for sale any article 'which is or may be used as a substitute for butter'. The purpose of sec. 97.025 to prohibit absolutely the sale of a product such as plaintiff's is expressed just as clearly; it provides that no person manufacture, sell or expose for sale any product which 'shall be in imitation of ice cream, * * *.' It appears from the stipulation that Dairy Queen resembles ice cream in its appearance, but that it is to be sold upon its own merits and under such circumstances that the purchaser will not be deceived into believing that he is buying ice cream. It was conceded in the Jelke case that the sale of oleomargarine effects a loss to the dairy industry. Despite that concession the enactment was held to be invalid.

The arguments of amici curiae seem better adapted to promote a restricted market for the dairy farmers' product and to control the forms in which the consumer may enjoy it. To sustain their contention would be to encourage monopoly by preventing the introduction of a wholesome product. What was said by the court in the Jelke case is applicable here 193 Wis. at page 323, 214 N.W. at page 373:

'Under the facts proven in this case, whatever the economics of the situation may be, from the standpoint of constitutional right the Legislature has no more power to prohibit the manufacture and sale of oleomargarine in aid of the dairy industry than it would have to prohibit the raising of sheep in aid of the beef cattle industry, or to prohibit the manufacture and sale of cement for the benefit of the lumber industry. In some cases a proper exercise of the police power results in advantage to a particular class of citizens and to the disadvantage of others. When that is the principal purpose of the measure, courts will look behind even the declared intent of Legislatures, and relieve citizens against oppressive acts, where the primary purpose is not to the protection of the public health, safety, or morals.'

It is urged that the decisions of the United States supreme Court in Carolene Products Co. v. U. S., 1944, 323 U.S. 18, 65 S.Ct. 1, 89 L.Ed. 15, and Federal Security Adm'r v. Quaker Oats Co., 1943, 318 U.S. 218, 63 S.Ct. 589, 87 L.Ed. 724, require us to hold sec. 97.025 valid. We prefer to abide by the rule of the Jelke case and to conclude that if a law creating, maintaining or sustaining a monopoly and purporting to prevent the sale of a wholesome product under circumstances which will not deceive the public, and to be sold without injury to any group except the monopoly is to be declared a valid enactment, some other court be called upon to do so.

Motion for rehearing denied.

CURRIE, Justice (dissenting).

Sec. 97.025(1), Stats., prohibits the sale, etc., of 'any article, product or compound made wholly or partly out of milk, cream, sweetening ingredient, flavoring, with or without coloring or eggs, which shall be in limitation of ice cream, sherbet or ices as defined by section 97.02'.

The error we made in construing the above quoted portion of sec. 97.025(1), Stats., in the original opinion in this case was in assuming that the method and manner of sale determines whether a product is an imitation of ice cream, or not. It was not the intention of the legislature that the method of sale of a product, including the labeling or advertising thereof, shall determine whether or not it is an imitation ice cream, but that such determination must be made from the product itself, irrespective of how sold.

The legislature by sec. 97.025(1) did not prohibit merely the 'sale' 'in imitation of ice cream' of a product such as Dairy Queen resembling ice cream but having a butterfat content in between that of ice cream and sherbet, as defined by sec. 97.02(10) and (10a), but it went further and absolutely prohibited the sale of such a product as Dairy Queen if it (the product, not sale thereof) was an 'imitation of ice cream'.

During World War II, when the federal government rationed the amount of milk solids that might be used in frozen dairy foods, the legislature enacted as a temporary war measure ch. 5 of the Laws of 1943, which reduced the minimum fat requirements for ice cream to eight per cent for the duration of the war emergency only, thus enabling a greater quantity of ice cream to be made from the available amount of milk solids. An ice cream having a butterfat of eight per cent is very similar to Dairy Queen with its six per cent fat content. This statute legalizing ice cream with an eight per cent fat content was repealed by ch. 586 of the Laws of 1945. In the 1949 session of the legislature, Bill 343-S was introduced, and in the 1951 session of the legislature, Bill 417-S was introduced, both of which provided for legalizing an iced dairy food product with a fat content in between sherbet and ice cream, such product to be known as 'iced milk'. The purpose of such bills was to legalize a product such as Dairy Queen, but both bills were killed by the legislature. These facts are further evidence of the legislative intent to prohibit the sale in Wisconsin of a product such as Dairy Queen having a milk fat content in between that of sherbet and ice cream.

The learned trial judge personally examined and tasted Dairy Queen and upon the evidence produced and his own personal examination and tasting he found in his Findings of Fact as follows:

'4. That 'Dairy Queen' is a partially frozen food product...