McComb v. WE Wright Co.

• Decision Date: 24 May 1948
• Docket Number: No. 10602.,10602.
• Parties: McCOMB, Adm'r of Wage and Hour Div., U. S. Dept. of Labor, v. W. E. WRIGHT CO.
• Court: U.S. Court of Appeals — Sixth Circuit

168 F.2d 40 (1948)

McCOMB, Adm'r of Wage and Hour Div., U. S. Dept. of Labor, v. W. E. WRIGHT CO.

No. 10602.

Circuit Court of Appeals, Sixth Circuit.

May 24, 1948.

Frederick U. Reel, of Washington, D. C. (William S. Tyson, Bessie Margolin, Frederick U. Reel, and M. Anastasia Thannhauser, all of Washington, D. C., and A. A. Caghan, of Cleveland, Ohio, on the brief), for appellant.

Robert C. Brouse, of Akron, Ohio (Edwin W. Brouse and Robert C. Brouse, both of Akron, Ohio, of counsel; Brouse, McDowell, May, Bierce & Wortman, of Akron, Ohio, on the brief), for appellee.

Before HICKS, SIMONS, and McALLISTER, Circuit Judges.

SIMONS, Circuit Judge.

The appellant Administrator sought and was denied an injunction to restrain the appellee from violating the overtime provisions of the Fair Labor Standards Act of 1938, 29 U.S.C.A. § 201 et seq. The appellee presented two defenses, the first being that it was not engaged in commerce within the meaning of § 7(a) of the Act, and the second that it was exempt from its provisions because it was a retail or service establishment under § 13(a) (2). The district court, sustaining the second defense, found it unnecessary to rule upon the first, and not only denied the prayer for injunction but dismissed the complaint.

The appellee is engaged at several locations in and near Akron, Ohio, in the business of selling coal, sand and gravel, paint, cinders, clay products, hardware and garden supplies, ready-mixed concrete, wall paper, heating equipment, building material, feed and seed. Its gross annual sales exceed $1,000,000. Its principal office is at 451 South Main Street, Akron, but it has other facilities both in and near the city. Approximately 15% in dollar volume of the goods it sells are received from sources outside of Ohio, but all of its sales are made within the state, approximately 79% thereof at retail. The business was organized in 1907 and expanded until the company had acquired six branch yards, but after it had converted to motor delivery four of these yards were sold. It retains its Main Street store adjacent to which it operates its general order department. To the rear of this retail store and connected with it, is the Main Street warehouse wherein its offices are located. A garage adjoins the warehouse, facing South High Street, and across High Street it operates its main supply yard from which retail sales are also made. Two miles from the Main Street address it operates another combination supply yard and retail store. A smaller yard and store three miles from its Main Street headquarters was operated until its sale during the proceedings. Five miles distant in Barberton, Ohio, it operates another small yard, warehouse and retail store. All of the yards have railroad sidings and at the High Street and Exchange Street locations that are locomotive cranes and storage and loading bins for bulk materials. While the larger yards and stores carry substantially all of the supplies, the facilities are not completely independent of one another, and an order accepted at one may be filled from supplies at another.

The employees here involved are those engaged in the Main Street warehouse and in the High Street and Exchange Street yards. It was stipulated that certain of them spent 25% of their time in unloading and storing both interstate and intrastate shipments received at the warehouse or yard at which they were employed. Concluding that both the unloading and storing of goods Montgomery Ward & Co. v. Antis, 6 Cir., 158 F.2d 948 received in interstate commerce are covered by the Act, and assuming that the mark-up on state and out-state goods does not appreciably vary, it would seem that these employees spend approximately 3.57% of their time unloading and storing goods received in interstate commerce.

If a substantial part of an employee's activities relates to goods whose movement is in the channels of interstate commerce, he is covered by the Act. Kirschbaum Co. v. Walling, 316 U.S. 517, 62 S.Ct. 1116, 86 L.Ed. 1638; Walling v. Jacksonville Paper Co., 317 U.S. 564, 572, 63 S.Ct. 332, 87 L.Ed. 460. Our first question, then, is whether in view of this percentage the employees, in respect to whom the injunction was sought, are within the coverage of the Act, for it is not enough that the employer is engaged in interstate commerce, but the employee must also be engaged therein. Montgomery Ward & Co. v. Antis, supra.

In Mabee v. White Plains Publishing Co., 327 U.S. 178, 66 S.Ct. 511, 90 L. Ed. 607, the Supreme Court rejected a contention that a minimum amount of interstate business would eliminate an industry from the classification of those which are engaged in interstate commerce. In view of the language of § 7(a) which prohibits an employer to employ any of his employees engaged in commerce or in the...