Grosjean v. American Press Co

• Decision Date: 10 February 1936
• Docket Number: No. 303,303
• Citation: Grosjean v. American Press Co, 297 U.S. 233, 56 S.Ct. 444, 80 L.Ed. 660 (1936)
• Parties: GROSJEAN, Sup'r of Public Accounts of Louisiana v. AMERICAN PRESS CO., Inc., et al
• Court: U.S. Supreme Court

297 U.S. 233

56 S.Ct. 444

80 L.Ed. 660

GROSJEAN, Sup'r of Public Accounts of Louisiana

v AMERICAN PRESS CO., Inc., et al.

No. 303.

Argued Jan. 13, 14, 1936.

Decided Feb. 10, 1936.

Appeal from the District Court of the United States for the Eastern District of Louisiana.

Messrs. Charles J. Rivet, of New Orleans, La., and Gaston L. Porterie, Atty. Gen., for appellant.

[Argument of Counsel from pages 234-236 intentionally omitted]Messrs. Esmond Phelps, of New Orleans, La., and Elisha Hanson, of Washington, D.C., for appellees.

[Argument of Counsel from pages 237-239 intentionally omitted]Mr. Justice SUTHERLAND delivered the opinion of the Court.

This suit was brought by appellees, nine publishers of newspapers in the state of Louisiana, to enjoin the enforcement against them of the provisions of section 1 of the act of the Legislature of Louisiana known as ActNo. 23, passed and approved July 12, 1934, as follows: 'That every person, firm, association or corporation, domestic or foreign, engaged in the business of selling, or making any charge for, advertising or for advertisements, whether printed or published, or to be printed or published, in any newspaper, magazine, periodical or publication whatever having a circulation of more than 20,000 copies per week, or displayed and exhibited, or to be displayed and exhibited, by means of moving pictures, in the State of Louisiana, shall, in addition to all other taxes and licenses levied and assessed in this State, pay a license tax for the privilege of engaging in such business in this State of two per cent. (2%) of the gross receipts of such business.'

The nine publishers who brought the suit publish thirteen newspapers; and these thirteen publications are the only ones within the state of Louisiana having each a circulation of more than 20,000 copies per week, although the lower court finds there are four other daily newspapers each having a circulation of 'slightly less than 20,000 copies pert week' which are in competition with those published by appellees both as to circulation and as to advertising.In addition, there are 120 weekly newspapers published in the state, also in competition, to a greater or less degree, with the newspapers of appellees.The revenue derived from appellees' newspapers comes almost entirely from regular subscribers or purchasers thereof and from payments received for the insertion of advertisements therein.

The act requires every one subject to the tax to file a sworn report every three months showing the amount and the gross receipts from the business described in section 1.The resulting tax must be paid when the report is filed.Failure to file the report or pay the tax as thus provided constitutes a misdemeanor and subjects the offender to a fine not exceeding $500, or imprisonment not exceeding six months, or both, for each violation.Any corporation violating the acts subjects itself to the payment of $500 to be recovered by suit.All of the appellees are corporations.The lower court entered a decree for appellees and granted a permanent injunction.(D.C.)10 F.Supp. 161.

First.Appellant assails the federal jurisdiction of the court below on the ground that the matter in controversy does not exceed the sum or value of $3,000, as required by paragraph 1 of section 24 of the Judicial Code (28 U.S.C.A. § 41(1).The case arises under the Federal Constitution; and the bill alleges, and the record shows, that the requisite amount is involved in respect of each of six of the nine appellees.This is enough to sustain the jurisdiction of the District Court.The motion was to dismiss the bill—that is to say, the bill in its entirety—and in that form it was properly denied.No motion to dismiss was made or considered by the lower court as to the three appellees in respect of whom the jurisdictional amount was insufficient, and that question, therefore, is not before us.The Rio Grande, 19 Wall. 178, 189, 22 L.Ed. 60;Gibson v. Shufeldt, 122 U.S. 27, 32, 7 S.Ct. 1066, 30 L.Ed. 1083.

Second.The objection also is made that the bill does not make a case for equitable relief.But the objection is clearly without merit.As pointed out in Ohio Oil Co. v. Conway, 279 U.S. 813, 815, 49 S.Ct. 256, 73 L.Ed. 972, the laws of Louisiana afford no remedy whereby restitution of taxes and property exacted may be enforced, even where payment has been made under both protest and compulsion.It is true that the present act contains a provision (section 5) to the effect that where it is established to the satisfaction of the Supervisor of Public Accounts of the state that any payment has been made under the act which was 'not due and collectible,' the supervisor is authorized to refund the amount out of any funds on hand collected by virtue of the act and not remitted to the state treasurer according to law.It seems clear that this refers only to a payment not due and collectible within the terms of the act, and does not authorize a refund on the ground that the act is invalid.Moreover, the act allows the supervisor to make remittances immediately to the state treasurer of taxes paid under the act, and requires him to do so not later than the 30th day after the last day of the preceding quarter; in which even the right to a refund, if not sooner exercised, would be lost.Whether an aggrieved taxpayer may obtain relief under section 5 is, at best, a matter of speculation.In no view can it properly be said that there exists a plain, adequate, and complete remedy at law.Davis v. Wakelee, 156 U.S. 680, 688, 15 S.Ct. 555, 39 L.Ed. 578;Union Pac. R. Co. v. Board of Com'rs of Weld County, 247 U.S. 282, 285, 38 S.Ct. 510, 62 L.Ed. 1110.

Third.The validity of the act is assailed as violating the Federal Constitution in two particulars: (1) That it abridges the freedom of the press in contravention of the due process clause contained in section 1 of the Fourteenth Amendment;(2) that it denies appellees the equal protection of the laws in contravention of the same amendment.

1.The first point presents a question of the utmost gravity and importance; for, if well made, it goes to the heart of the natural right of the members of an organized society, united for their common good, to impart and acquire information about their common interests.The First Amendment to the Federal Constitution provides that 'Congress shall make no law * * * abridging the freedom of speech, or of the press.'While this provision is not a restraint upon the powers of the states, the states are precluded from abridging the freedom of speech or of the press by force of the due process clause of the Fourteenth Amendment.

In the case of Hurtado v. California, 110 U.S. 516, 4 S.Ct. 111, 28 L.Ed. 232, this court held that the term 'due process of law' does not require presentment or indictment by a grand jury as a prerequisite to prosecution by a state for a criminal offense.And the important point of that conclusion here is that it was deduced from the fact that the Fifth Amendment, which contains the due process of law clause in its national aspect, also required an indictment as a prerequisite to a prosecution for crime under federal law; and it was thought that since no part of the amendment could be regarded as superfluous, the term 'due process of law' did not, ex vi termini, include presentment or indictment by a grand jury in any case; and that the due process of law clause of the Fourteenth Amendment should be interpreted as having been used in the same sense, and as having no greater extent.But in Powell v. State of Alabama, 287 U.S. 45, 65, 68, 53 S.Ct. 55, 77 L.Ed. 158, 84 A.L.R. 527, we held that in the light of subsequent decisions the sweeping language of the Hurtado Case could not be accepted without qualification.We concluded that certain fundamental rights, safeguarded by the first eight amendments against federal action, were also safe- guarded against state action by the due process of law clause of the Fourteenth Amendment, and among them the fundamental right of the accused to the aid of counsel in a criminal prosecution.

That freedom of speech and of the press are rights of the same fundamental character, safeguarded by the due process of law clause of the Fourteenth Amendment against abridgement by state legislation, has likewise been settled by a series of decisions of this court beginning with Gitlow v. People of State of New York, 268 U.S. 652, 666, 45 S.Ct. 625, 69 L.Ed. 1138, and ending with Near v. State of Minnesota, 283 U.S. 697, 707, 51 S.Ct. 625, 75 L.Ed. 1357.The word 'liberty' contained in that amendment embraces not only the right of a person to be free from physical restraint, but the right to be free in the enjoyment of all his faculties as well.Allgeyer v. State of Louisiana, 165 U.S. 578, 589, 17 S.Ct. 427, 41 L.Ed. 832.

Appellant contends that the Fourteenth Amendment does not apply to corporations; but this is only partly true.A corporation, we have held, is not a 'citizen' within the meaning of the privileges and immunities clause.Paul v. Virginia, 8 Wall, 168, 19 L.Ed. 357.But a corporation is a 'person' within the meaning of the equal protection and due process of law clauses, which are the clauses involved here.Covington & L. Turnpike Road Co. v. Sandford, 164 U.S. 578, 592, 17 S.Ct. 198, 41 L.Ed. 560;Smyth v. Ames, 169 U.S. 466, 522, 18 S.Ct. 418, 42 L.Ed. 819.

The tax imposed is designated a 'license tax for the privilege of engaging in such business,' that is to say, the business of selling, or making any charge for, advertising.As applied to appellees, it is a tax of 2 per cent. on the gross receipts derived from advertisements carried in their newspapers when, and only when, the newspapers of each enjoy a circulation of more than 20,000 copies per week.It thus operates as a restraint in a double sense.First, its effect is to curtail the amount of revenue realized from advertising; and, second, its...