Gruetter v. Cumberland Tel. & Tel. Co.

• Decision Date: 13 September 1909
• Docket Number: 3,578.
• Citation: 181 F. 248
• Parties: GRUETTER v. CUMBERLAND TELEPHONE & TELEGRAPH CO.
• Court: U.S. District Court — Western District of Tennessee

181 F. 248

GRUETTER v. CUMBERLAND TELEPHONE & TELEGRAPH CO.

No. 3,578.

United States Circuit Court, W.D. Tennessee, Western Division.

September 13, 1909

[Copyrighted Material Omitted]

Crownover & Crabtree, for plaintiff.

W. L Granbery, for defendant.

SANFORD District Judge.

After careful consideration, I have reached the conclusion that the plaintiff's motion to remand this suit to the state court from which it was removed by the defendant is not well taken.

1. The first ground of the motion is that this is a suit to recover a penalty, and not an action of a civil nature that can be removed to the federal court on the ground of diverse citizenship. While I held in January of this year in the case of Brown v. Cumberland Telephone Company, 181 F 246, at Memphis, that a suit of this character brought against a telephone company under Act Tenn. 1885, c. 66, Sec. 11, is an action for 'statute penalties,' which, under section 2772 of the Tennessee Code (Shannon's Code, Sec. 4469), is barred within one year after the cause of action accrues, I am nevertheless of opinion that, although a suit for penalties, it is 'a suit of a civil nature at law, ' which is removable to the federal court under section 2, Act Aug. 13, 1888, c. 866, 25 Stat. 434 (U.S. Comp. St. 1901, p. 509). The Tennessee statute provides that every telephone company doing business within the state shall supply all applicants for telephones and telephone facilities without discrimination or partiality, and shall not impose any condition or restriction upon any such applicant not imposed impartially upon all persons or companies in like situations, 'under penalty of one hundred dollars for each day such company continues such discrimination and refuses such facilities, * * * to be recovered by the applicant whose application is so neglected or refused. ' It was held by the Circuit Court of Appeals for this circuit in Cumberland Telephone Co. v. Kelly, 160 F. 316, 87 C.C.A. 268, that this statute is directed only against discriminations in telephone service, and is merely declaratory of the common-law obligation of telephone companies not to discriminate, giving a new remedy and enforcing the common-law obligation by severe penalties. The statute is therefore in its essence one which merely declares and enforces a common-law obligation of a civil nature. It does not create any criminal offense, or provide for any criminal prosecution. It imposes no fine or penalty which may be recovered by the state. It provides for no qui tam action by which any injury to the public may be punished by fine. It simply, in its last analysis, recognizes the common-law obligation of telephone companies to furnish undiscriminating service, and enforces this obligation by a severe penalty, in the nature of punitive damages, recoverable in a civil action brought by the person against whom there has been a wrongful discrimination.

In determining whether a suit to enforce a penalty provided by a state statute is one 'of a civil nature' which is removable under section 2, Act Aug. 13, 1888, c. 866, 25 Stat. 434 (U.S. Comp. St. 1901, p. 509), correcting the enrollment of Act March 3, 1887, c. 373, 24 Stat. 552, and amending Act March 3, 1875, c. 137, 18 Stat. 470, the question is not whether the state statute is to be considered as remedial or penal for the purpose of the application of the rule of strict construction, but whether the action brought to enforce the penalty provided by the statute is essentially civil in its nature, as distinct from one which is criminal, or quasi criminal, in its nature. While the precise question here involved appears never to have been adjudged, I think a just rule fairly deducible from the trend of authority, and based upon sound reason, is this: That where the statute does not create any criminal offense or provide for any criminal prosecution or for the recovery by the state of any fine or penalty for any public wrong, but merely provides a money penalty for a private wrong, recoverable by the aggrieved party for his own benefit, a suit brought to recover such penalty is in its essence one of a civil nature, even though the penalty imposed by the statute amounts to punitive damages, and is hence removable to the federal court. 'A civil action is an action brought to recover some civil right, or to obtain redress for some wrong not being a crime or misdemeanor. ' Burrell's Law Dict. 294. 'An action is 'civil' when it lies to enforce a private right, or redress a private wrong. It is 'criminal' when instituted on behalf of the sovereign or commonwealth in order to vindicate the law by the punishment of a public offense. ' Rapalje & Lawrence's Law Dict. 21. A civil action at common law is 'an action which has for its object the recovery of private or civil rights or compensation for their infraction. ' Bouvier's Law Dict. (15th Ed.) 317. In Huntington v. Attrill, 146 U.S. 657, 667, 673, 676, 13 Sup.Ct. 224, 36 L.Ed. 1123, in which it was held that a state statute, making the officers of a corporation who sign and record a false certificate of the amount of its capital stock liable for all its debts, was 'in no sense a criminal or quasi criminal law,' and not a penal law in the international sense so that it could not be enforced in the courts of another state, Mr. Justice Gray, delivering the opinion of the court, said:

'Penal laws, strictly and properly, are those imposing punishment for an offense committed against the state, and which, by the English and American constitutions, the executive of the state has the power to pardon. Statutes giving a private action against the wrongdoer are sometimes spoken of as penal in their nature, but in such cases it has been pointed out that neither the liability imposed nor the remedy given is strictly penal. The action of an owner of property against the hundred to recover damages caused by a mob was said by Willes and Buller to be 'penal against the hundred, but certainly remedial as to the sufferer.' Hyde v. Cogan, 2 Doug. 699, 705, 706. A statute giving the right to recover back money lost at gaming, and, if the loser does not sue within a certain time, authorizing a qui tam action to be brought by any other person for threefold the amount, has been held to be remedial as to the loser, though penal as regards the suit by a common informer. Bones v. Booth, 2 W.Bl. 1226; Brandon v. Pate, 2 H.Bl. 308; Grace v. McElroy, 1 Allen (Mass.) 563; Read v. Stewart, 129 Mass. 407, 410; Cole v. Groves, 134 Mass. 471. As said by Mr. Justice Amhurst in the King's Bench and repeated by Mr. Justice Wilde in the Supreme Judicial Court of Massachusetts: 'It has been held in many instances that, where a statute gives accumulative damages to a party grieved, it is not a penal action.' Woodgate v. Knatchbull, 2 T.R. 148, 154; Read v. Chelmsford, 16 Pick. (Mass.) 128, 132. Thus a statute giving to a tenant ousted without notice double the yearly value of the premises against the landlord has been held to be 'not like a penal law where a punishment is imposed for a crime,' but 'rather as a remedial than a penal law,' because 'the act indeed does give a penalty, but it is to the party grieved.' Lake v. Smith, 1 Bos. & Pul. (N.R.) 174, 179, 180, 181; Wilkinson v. Colley, 5 Burrow, 2694, 2698. So in an action given by a statute to a traveler injured through a defect in a highway for double damages against the town it was held unnecessary to aver that the facts constituted an offense, or to conclude against the form of the statute, because, as Chief Justice Shaw said: 'The action is purely remedial, and has none of the characteristics of a penal prosecution. * * * Here the plaintiff sets out the liability of the town to repair, and an injury to himself from a failure to perform that duty. The law gives him enhanced damages; but still they are recoverable to his own use, and in form and substance the suit calls for indemnity.' Reed v. Northfield, 13 Pick. (Mass.) 94, 100, 101, 23 Am.Dec. 662. The test whether a law is penal, in the strict and primary sense, is whether the wrong sought to be redressed is a wrong to the public, or a wrong to the individual. According to the familiar classification of Blackstone: 'Wrongs are divisible into two sorts or species--private wrongs and public wrongs. The former are an infringement or privation of the private or civil rights belonging to individuals, considered as individuals, and are thereupon frequently termed civil injuries. The latter are a breach and violation of public rights and duties, which affect the whole community, considered as a community; and are distinguished by the harsher appellation of crimes and misdemeanors.' 3 Bl.Com. 2. The question whether a statute of one state which in some aspects may be called penal is a penal law in the international sense, so that it cannot be enforced in the courts of another state, depends upon the question whether the purpose is to punish an offense against the public justice of the state, or to afford a private remedy to a person injured by the wrongful act.'

In State v. Chicago, B. & Q.R. Co. (C.C.) 37 F. 497, 3 L.R.A. 554, in which it was held that an action brought by the state to recover a forfeiture for an offense declared to be a misdemeanor was, though civil in form, one of a criminal nature which was not removable to the federal court, Mr. Justice Brewer, then Circuit Judge, after citing various authorities stating the distinction between matters of a civil and a criminal nature, including the definitions from the law dictionaries above quoted, said:

'That a case may partake something of the nature of both is as might be expected, and naturally it is not always clear which element predominates. Thus in a civil action for

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