Gavril v. Kraft Cheese Co., 2509.

• Decision Date: 27 November 1941
• Docket Number: No. 2509.,2509.
• Citation: 42 F. Supp. 702
• Parties: GAVRIL et al. v. KRAFT CHEESE CO. (FLEMING, Administrator of Wage and Hour Division, United States Department of Labor, Intervenor).
• Court: U.S. District Court — Northern District of Illinois

42 F. Supp. 702

GAVRIL et al. v. KRAFT CHEESE CO. (FLEMING, Administrator of Wage and Hour Division, United States Department of Labor, Intervenor).

No. 2509.

District Court, N. D. Illinois, E. D.

November 27, 1941.

Frederick A. Smith, of Chicago, Ill., for plaintiff.

Nicholson, Snyder, Chadwell and Fagerburg, of Chicago, Ill., for defendant.

Gerald D. Reilly and Irving J. Levy, both of Washington, D. C., and Alex Elson and Lee K. Beznor, both of Chicago, Ill., for Administrator of Wage & Hour Division, Amicus Curiae.

CAMPBELL, District Judge.

This is a case brought by eleven former employees of the defendant company under the Fair Labor Standards Act of 1938, 29 U.S.C.A. §§ 201-219 on behalf of themselves and all other employees similarly situated for the recovery of overtime compensation claimed by reason of alleged violation of Section 7 of the said Act, together with liquidated damages and reasonable attorney's fees.

Now before the Court, filed by the defendant are:

1. Motion for summary judgment.

2. Motion to dismiss complaint.

3. Motion to strike certain allegations from amended complaint.

4. Motion for more definite statement.

The first two motions will be considered together at this time since the defendant sets up the same grounds in support of each. These grounds are: first, that the plaintiffs were not engaged in commerce or in the production of goods for commerce within the meaning of the Fair Labor Standards Act; second, that should it be decided that the plaintiffs were engaged in commerce within the meaning of the Fair Labor Standards Act, the said Act does not apply by reason of the exemption contained in Section 13(b).

With respect to the defendant's first ground for summary judgment or dismissal of the complaint, the Court has been furnished with the affidavits of Mr. Paul Vandiver and Mr. Sanger C. Lindbloom on behalf of the defendant and with the affidavit of Mr. George E. Simon on behalf of the plaintiffs. These affidavits reveal that the defendant company is engaged on a national scale in the manufacture and distribution at wholesale of cheese and other food products. That its distribution within the State of Illinois embraces products manufactured within the State and products manufactured outside of the State and shipped by the defendant to its warehouse within the State. That from the said warehouse products manufactured both within and without the State are subsequently transferred to branch warehouses from which branch warehouses the said products are then removed by so-called "driver-salesmen" to be sold to various retail grocers, delicatessen stores, restaurants and other retail dealers from the trucks of the defendant operated by the said "driver-salesmen". That all of the plaintiffs in this case were such "driver-salesmen" and each had assigned to him a certain route or territory within the City of Chicago.

Section 7 of the Fair Labor Standards Act limits the hours of work and defines the rate of overtime compensation for employees "engaged in commerce or in the production of goods for commerce". Thus the test to be applied to this or any other suit brought under the provisions of that act is whether or not the activities of the individual employee brings such employee within that definition. In order to classify the activities of the employee however it is necessary also to consider the activities of the employer by whom he is engaged.

The defendant in its two briefs has cited many cases in an attempt to show that the activities of the defendant as described above do not constitute commerce within the meaning of the Fair Labor Standards Act and that therefore the plaintiffs cannot be engaged in commerce or in the production of goods for commerce. All of the cases cited by the defendant on this point have been studied and the Court finds that they are all easily distinguishable, at least factually, from the case at bar.

From a consideration of the legal principles enunciated in the cases cited by the defendant as well as in the cases cited by the plaintiffs and by the Amicus Curiae, together with a review of the Fair Labor Standards Act, and the proceedings in Congress at the time of the passage of that Act, the court is of the opinion that the activities of the defendant in this case constitute commerce within the meaning of that Act.

The defendant on page 13 of its original brief cites several other Acts of Congress wherein the phrase "engaged in commerce" is used and later cites cases interpreting the use of that phrase in some of those Acts. Among the other Acts of Congress which use this phrase the defendant lists the Federal Trade Commission Act, 15 U. S.C.A. § 41 et seq., the Clayton Act, 15 U. S.C.A. § 12 et seq., and the Robinson Patman Act amending it, 15 U.S.C.A. § 13(a).

In the case of Federal Trade Commission v. Kraft-Phenix Cheese Corporation, Federal Trade Commission Complaint No. 2935, (Vol. 2 Federal Trade Regulation Service Par. 9061), The Federal Trade Commission in an opinion dismissing a proceeding against Kraft-Phenix Cheese Corporation said, among other things:

"Respondent Kraft-Phenix Cheese Corporation, individually and through subsidiaries, manufactures and distributes on a nationwide scale a line of processed cheese, package cheese and salad dressing. Respondent itself ships these products across state lines from factories to warehouses and the products are usually distributed from warehouses to retailers by truck by sales subsidiaries of respondent or independently owned jobbers and wholesalers. The distribution from the warehouses to retailers is usually within the confines of a single state, although in some cases this distribution crosses state lines. Respondent advertises its products extensively to the purchasing public and maintains a force of salesmen who contact retailers, most of whom buy Kraft products from independent jobbers. There is a continuous, uninterrupted flow and current of commerce in respondent's products from the factories to warehouses and from the warehouses over regularly established routes to retailers, whose identity is known in advance. The course of such commerce runs between, among, across, and within all the states of the United States and the District of Columbia.

"Considered in their character as interstate commerce, respondent's products, upon reaching the warehouse, do not become mixed with or a part of the general mass of...