Goldberg v. CROWLEY RIDGE FRUIT & VEG. GROWERS'ASS'N

• Decision Date: 16 October 1961
• Docket Number: No. 16732.,16732.
• Parties: Arthur J. GOLDBERG, Secretary of Labor, United States Department of Labor, Appellant, v. CROWLEY RIDGE FRUIT & VEGETABLE GROWERS ASSOCIATION, a corporation, Appellee.
• Court: U.S. Court of Appeals — Eighth Circuit

295 F.2d 7 (1961)

Arthur J. GOLDBERG, Secretary of Labor, United States Department of Labor, Appellant, v. CROWLEY RIDGE FRUIT & VEGETABLE GROWERS ASSOCIATION, a corporation, Appellee.

No. 16732.

United States Court of Appeals Eighth Circuit.

October 16, 1961.

Beate Bloch, Attorney, U. S. Dept. of Labor, Washington, D. C., Bessie Margolin, Asst. Solicitor, U. S. Dept. of Labor, Washington, D. C., Charles Donahue, Solicitor of Labor, U. S. Dept. of Labor, Washington, D. C., and Earl Street, Regional Attorney, Dallas, Tex., on the brief, for appellant.

E. J. Butler, Forrest City, Ark., for appellee.

Before SANBORN, MATTHES and RIDGE, Circuit Judges.

RIDGE, Circuit Judge.

The Secretary of Labor commenced this action under Section 16(c) of the Fair Labor Standards Act (29 U.S.C.A. § 216 (c)) to recover unpaid minimum wages and unpaid overtime compensation allegedly due thirty-five employees of appellee. Appellee, hereinafter referred to as "the Association," is a corporation, duly organized under the laws of the State of Arkansas. It was formulated by a group of eight peach farmers and growers for the purpose of "common cooperation for the better sale of peaches" grown by them on their respective farms.

The undisputed facts reveal that the peach-grower members of the Association set up, equipped and mutually bore the cost of a shed in Forrest City, Arkansas, for the grading, processing and packing of peaches which were grown on the separate farms of the members. The employees on whose behalf this suit was brought worked in that shed, processing, packing and handling peaches during the 1957 and 1958 peach harvests. During both of those peach-growing-packing seasons the Association members brought their peaches in trucks to the shed. The peaches were then unloaded on the shed docks and identified as those of an individual member. Thereafter, they were processed and packed; and placed aboard trucks for shipment in interstate commerce. In so dealing with the produce, each grower's peaches were run through the shed separately and retained that grower's identification marks thereon until they were sold at destination. Shipment of the peaches from the Association's shed was not made in the name of the Association but in the name of Summersweet Orchard Sales Company (hereinafter called "Summersweet") who, through its agent, A. C. Eichberg, set the price therefor, transferred title thereto, and sold the peaches to the purchaser thereof in "Summersweet's" name. The total proceeds from all sales so made were paid to Summersweet, who in turn paid the same, in toto, over to the Association. At the end of each season, the Association paid "Summersweet" a commission of ten cents per bushel for selling the peaches. After payment of such commission, the funds of the Association were then distributed to the peach-grower owners at the end of the peach-growing-packing season in ratio of the peaches they had packed at the shed, less the expense of operating the shed. Under that arrangement each peach-grower member paid a proportionate part of the cost and expense of operating the shed.

A. C. Eichberg, a member of the Association, also runs Summersweet Orchard Sales Company. (Whether that entity is a corporate one, or a trade-name, is not established in the record.) Eichberg is also in overall charge of operation of the Association's shed. He is in direct charge of sales. He also employs most of the Association's employees, and operates the shed in cooperation and consultation with the other seven members of the Association. The packing plant employees worked under the direct supervision of a foreman who was employed by the Association upon the recommendation of a member other than Eichberg. The individual members of the Association frequently observed the operations of the packing plant and, at times, instructed employees concerning the grading and packing of their own peaches when run through the shed. The wages of all employees were fixed by the members of the Association at meetings held frequently throughout the harvesting season. Such wages were paid by checks issued by, and in the name of, the Association, and the Association paid Social Security taxes for all its employees. The Association neither owned nor operated any farm and the shed above mentioned was not located on a farm.

Under the above-stated facts, the District Court found that the employees for whom this action is brought were exempt from the minimum wage and overtime requirements of the Fair Labor Standards Act, (29 U.S.C.A. § 201 etc.) on the premise (tersely stated) that the Association "was merely used as an agent and vehicle of convenience by the individual peach growers and farmers" who were members and "as such, was part of an operation of peach farmers banded together and engaged in the processing and packing of their own individual peaches, and, as such, is entitled to claim the agricultural exemption from the minimum wage and overtime compensation provisions of the Fair Labor Standards Act," under 3(f) and 13(a) (6) thereof, as amended.

On that premise the District Court entered judgment dismissing the Secretary's original and supplemental complaints and entered judgment in favor of defendant in this action. In so doing, we think the District Court erred in its consideration of applicable and controlling provisions of the Act, as interpreted by the Supreme Court of the United States, in Farmers Reservoir & Irrigation Co. v. McComb, 1949, 337 U.S. 755, 69 S.Ct. 1274, 93 L.Ed. 1672.

Section 13(a) (6) of the Act, supra, exempts from the minimum wage and overtime provisions thereof, among others, "any employee employed in agriculture." Section 3(f) of the Act defines the term "agriculture" as follows:

"`Agriculture\' includes farming in all its branches and among other things includes the cultivation and tillage of the soil, dairying, and production, cultivation, growing, and harvesting of any agricultural or horticultural commodities (including commodities defined as agricultural commodities in section 15(g) of the Agricultural Marketing Act, as amended), the raising of livestock, bees, fur-bearing animals, or poultry, and any practices (including any forestry or lumbering operations) performed by a farmer or on a farm as an incident to or in conjunction with such farming operations, including preparation for market, delivery to storage or to market or to carriers for transportation to market."

The inapplicability of the above definition to the work of the employees in the present case is so categorically declared and finalized by interpretation of Section 3(f) and 13(a) (6) of the Act, by the Supreme Court in Farmers Reservoir & Irrigation Co. v. McComb, supra, that it is readily apparent to this Court that any claimed agricultural exemption by this Association, under the facts existing in this case, should have been denied and rejected.

By its decision in the Farmers Irrigation case, supra, the Supreme Court held that field employees (ditch riders, lake tenders and maintenance men) of a non-profit irrigation company mutually owned by farmers and serving only member-farmers, were within the coverage of the Fair Labor Standards Act as employed in an "`occupation necessary to the production' of goods for interstate commerce," but not exempt under Section 13(a), as being "employed in agriculture"; that the irrigation company there considered was not engaged in "agriculture" within the meaning of Section 3(f) of the Act, since it owned no farms, raised no crops, and was not engaged in cultivating or tilling the soil or in growing any agricultural commodity; and, that employees of such irrigation company were not exempt under 13(a) (6), supra, as the activities of employees there in question were not "performed by a farmer or on a farm," within the meaning of Section 3(f). The Supreme Court in that case pointed out that the statutory definition of "agriculture" has two distinct meanings. The "primary meaning" which includes "farming in all its branches," such as "cultivation and tillage of the soil * * * growing, and harvesting" of crops; and a "second" and "broader meaning" which includes other farm practices, but "only if they are performed by a farmer or on a farm." 337 U.S. 762-763, 766, 69 S.Ct. 1274, 1278, 1280. Plainly, from what is said in the Farmers Irrigation case, supra, neither such "primary" nor "secondary" meaning of the term "agriculture" has any application to a packing shed owned and conducted by an independent entity, though composed of farmers, which entity owns no farms and is not engaged in any farming and operates a packing shed, not located on a farm but in a community from which it draws almost all of its employees for the operation of its business, independent of any "agricultural" considerations, within the meaning of the Act.

The conclusion of the District Court, as hereinabove noted, is therefore not a reasonable one to be made from the facts of this case. Under the undisputed facts here established, such conclusion is in direct conflict with what the Supreme Court said and rejected with respect to a similar set of facts, in the Farmers Irrigation Company case. The factual situation in that case cannot be distinguished from those existing in the case at bar. In respect thereto, the Court said:

"Even

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