FARMERS'GIN CO. v. Hayes, Civ. No. 1296.

• Decision Date: 20 December 1943
• Docket Number: Civ. No. 1296.
• Citation: 54 F. Supp. 43
• Parties: FARMERS' GIN CO. v. HAYES, State Director, Office of Price Administration of Oklahoma. BROWN, Price Administrator of Office of Price Administration, v. FARMERS' GIN CO. et al.
• Court: U.S. District Court — Western District of Oklahoma

54 F. Supp. 43

FARMERS' GIN CO. v. HAYES, State Director, Office of Price Administration of Oklahoma.

BROWN, Price Administrator of Office of Price Administration, v. FARMERS' GIN CO. et al.

Civ. No. 1296.

District Court, W. D. Oklahoma.

December 20, 1943.

James F. Hatcher, of Chickasha, Okl., for plaintiff Garmers' Gin Co.

O. K. Wetzel and O. B. Martin, both of Oklahoma City, Okl., and A. M. Dreyer and George Austin, both of Washington, D. C., for defendants Rex A. Hayes and Prentiss M. Brown.

Floyd Green and S. H. King, both of Oklahoma City, Okl., for intervener Oklahoma Corporation Commission.

Clarence McElroy, of Chickasha, Okl., for Chickasha Cotton Oil Co. W. A. Lybrand, of Oklahoma City, Okl., for various other intervening cotton oil mill companies.

Before MURRAH, Circuit Judge, and VAUGHT and CHANDLER, District Judges.

MURRAH, Circuit Judge.

The first question presented for decision is whether this case is one cognizable by a three judge court under Section 266, Jud. Code, 28 U.S.C.A. § 380, and the question is squarely presented by the following pertinent facts which appear upon the face of the pleadings.

On August 11, 1943, in pursuance of authority granted by Section 2 of the Emergency Price Control Act of 1942, 50 U.S. C.A.Appendix § 902, Pub. 421, 77th Congress, the Price Administrator by regulatory order No. 211 fixed cotton ginning rates applicable to the State of Oklahoma at 27½¢ per cwt. for picked cotton, 30¼¢ per cwt. for snapped cotton, and $1.85 per pattern for bagging and ties, and forbade the ginners to charge in excess thereof.¹ Thereafter, on August 16, 1943, the Corporation Commission of the State of Oklahoma, acting in pursuance of state constitutional and statutory authority, Art. 9, Sec. 19, Constitution of Oklahoma, 17 O.S.A. 41-46, promulgated its order No. 16558, in which it fixed the rates to be charged for cotton ginning in Oklahoma at 30¢ per cwt. for picked cotton, 35¢ per cwt. for snapped cotton, and $2 per pattern for bagging and ties.

The Farmers' Gin Company, a corporation operating gins in Oklahoma, brought this suit to enjoin the District Price Director of the Office of Price Administration from enforcing the maximum price regulations provided in regulatory order No. 211,² on the grounds and for the reason that the cotton gins in Oklahoma are public utilities,³ and the Emergency Price Control Act is expressly made inapplicable to rates of public utilities by Section 302(c) (2) of the Act, 50 U.S.C.A.Appendix § 942(c) (2), hence the rates charged for ginning services in Oklahoma are not subject to regulation or control by the Office of Price Administration. By timely motion to dismiss, the District Price Director challenged the jurisdiction of this court to determine the question on the grounds that Section 204 (d) of the Act, 50 U.S.C.A.Appendix § 924d, expressly deprived the United States district court of jurisdiction to determine the validity of any maximum price fixing order or regulation, but conferred exclusive jurisdiction upon the emergency court of appeals created by the Act.

While the motion of the District Director was pending and undetermined, the National Price Administrator of the Office of Price Administration was allowed to intervene. The Corporation Commission, the Oklahoma Cotton Ginners Association, as representative of a class, and other ginning companies operating in Oklahoma, were made parties defendant to the intervention. The petition of intervention alleged the price order of August 16th; and contended that the order of the Corporation Commission fixing the rates to be charged for ginning service was invalid under the Supremacy Clause of the Constitution of the United States, Art. 6, Clause 2, because in conflict with the maximum prices for the same services established by the Office of Price Administration in Regulation No. 211, as amended. The petition prayed for an interlocutory and final injunction enjoining the Commission and its members from enforcing the Commission's order insofar as it conflicts with the order of the Price Administrator. The ginners filed a counterclaim to the petition in intervention in which they sought an injunction against the enforcement of the price regulation, all as alleged in their original complaint, and the Price Administrator moved to dismiss the counterclaim on the grounds that the court had no jurisdiction to entertain it under Section 204(d) as alleged in its original motion to dismiss. The Corporation Commission moved to dismiss the Administrator's petition on substantially the same grounds asserted in the motions of the ginning companies. The Price Administrator made application for a hearing on its motion for an interlocutory injunction before a three judge court under Section 266. The application for a three judge court is based upon the allegation in the petition of intervention to the effect that the order of the Corporation Commission fixing and prescribing the rates for cotton ginning services in Oklahoma, is repugnant to and in violation of the Supremacy Clause of the Constitution of the United States, because the said order is in conflict with the orders of the Price Administrator while acting in pursuance of superior Federal law.

This court was convened in pursuance of Section 266, and this cause comes on for hearing on a motion of the Price Administrator for an interlocutory injunction, and on the countervailing jurisdictional motions of the ginners, the Corporation Commission, and Administrator. The ginners contend that this case is not cognizable by a three judge court under Section 266, because the Administrator does not seek an interlocutory injunction against the enforcement of a state statute, or an order of a board or commission in pursuance thereof, on the grounds of its unconstitutionality. Rather, it is insisted that the sole question involved here is the construction to be given a Federal statute; that if the statute is applicable, it is concededly supreme, and it prevails, consequently no constitutional question is involved.

Section 266 applies only when the constitutionality of a state statute, or an administrative order in pursuance thereof is challenged, and an interlocutory injunction against the enforcement of the statute or order is sought in a Federal court. In re Buder, 271 U.S. 461, 463, 467, 46 S.Ct. 557, 70 L.Ed. 1036; Hobbs v. Pollock, 280 U.S. 168, 50 S.Ct. 83, 74 L.Ed. 353; Stratton v. St. Louis S. W. Ry., 282 U.S. 10, 51 S.Ct. 8, 75 L.Ed. 135. The statute is a technical enactment, and the jurisdiction conferred thereby is narrow and should be strictly construed. Phillips v. United States, 312 U.S. 246, 61 S.Ct....