McGoon v. Northern Pac. Ry. Co. Cook

• Decision Date: 14 May 1913
• Citation: 204 F. 998
• Parties: McGOON v. NORTHERN PAC. RY. CO. COOK v. SAME. LITTLER v. SAME.
• Court: U.S. District Court — District of North Dakota

204 F. 998

McGOON v. NORTHERN PAC. RY. CO. COOK v. SAME.

LITTLER v. SAME.

United States District Court, D. North Dakota, Southeastern Division.

May 14, 1913

W. S Lauder, of Wahpeton, N.D., for plaintiffs.

Edw. T Conmy, of Fargo, N.D., for defendant.

AMIDON District Judge.

The plaintiffs brought six separate actions against the defendant in the district court of Richland county, N.D. They are all based upon shipments of live stock from Western North Dakota and Eastern Montana, to Chicago, Ill. Each complaint embraces several causes of action, but the principal ground of recovery is alleged damage to the live stock by reason of defendant's failure to perform its duty as a common carrier. The suits were removed into this court upon the ground that they arise under the Interstate Commerce Act (Act Feb. 4, 1887, c. 104, 24 Stat. 379 (U.S. Comp. St. 1901, p 3154)). In neither case does the plaintiff seek to recover $3,000, and motion is now made to remand the suits to the state court because the amount in controversy is less than the sum required to justify their removal, and also because they do not involve a federal question.

Section 24 of the Judicial Code (Act March 3, 1911, c. 231, 36 Stat. 1091 (U.S. Comp. St. Supp. 1911, p. 135)) specifies the suits of which the District Courts are given original jurisdiction. Subdivision 1 of that section ends with the following proviso:

'Provided, however, that the foregoing provision as to the sum or value of the matter in controversy shall not be construed to apply to any of the cases mentioned in the succeeding paragraphs of this section.'

Subdivision 8, which follows this proviso, enacts that the District Courts shall have original jurisdiction--

' * * * of all suits and proceedings arising under any law regulating commerce, except those suits and proceedings exclusive jurisdiction of which has been conferred upon the Commerce Court.'

It is claimed by the defendant that these actions are suits 'arising under a law regulating commerce,' and for that reason may, under the proviso above quoted, be removed into the federal court, although they involve less than $3,000.

Defendant's liability arises wholly out of section 20 of the Interstate Commerce Act, as amended by Act June 29, 1906, c. 3591, Sec. 7, 34 Stat. at Large, 584, 593 (U.S. Comp. St. Supp. 1911, p. 1307). Under the decision of the Supreme Court in Adams Express Co. v. Croninger, 226 U.S. 491, 33 Sup.Ct. 148, 57 L.Ed. . . ., that section abrogates all state and common-law liabilities on interstate shipments of property. If the statute does not give plaintiff a right of recovery, he has none. The court says, at pages 505 and 506 of 226 U.S., and page 152 of 33 S.Ct. (57 L.Ed. . . .):

'That the legislation supersedes all the regulations and policies of a particular state upon the same subject results from its general character. It embraces the subject of the liability of the carrier under a bill of lading which he must issue and limits his power to exempt himself by rule, regulation or contract. Almost every detail of the subject is covered so completely that there can be no rational doubt but that Congress intended to take possession of the subject and supersede all state regulation with reference to it. Only the silence of Congress authorized the exercise of the police power of the state upon the subject of such contracts. But when Congress acted in such a way as to manifest a purpose to exercise its conceded authority, the regulating power of the state ceased to exist. Northern Pac. Ry. v. State of Washington, 222 U.S. 370 (32 Sup.Ct. 160, 56 L.Ed. 237); Southern Railway v. Reid, 222 U.S. 424 (32 Sup.Ct. 140, 56 L.Ed. 257); Mondou v. Railroad, 223 U.S. 1 (32 Sup.Ct. 169, 56 L.Ed. 327, 38 L.R.A. (N.S.) 44).

'To hold that the liability therein declared may be increased or diminished by local regulation or local views of public policy will either make the provision less than supreme or indicate that Congress has not shown a purpose to take possession of the subject. The first would be unthinkable and the latter would be to revert to the uncertainties and diversities of rulings which led to the amendment. The duty to issue a bill of lading and the liability thereby assumed are covered in full, and though there is no reference to the effect upon state regulation, it is evident that Congress intended to adopt a uniform rule and relieve such contracts from the diverse regulation to which they had been theretofore subject.'

The statute referred to is a part of the Interstate Commerce Act. It is not only incorporated in its language, but is germane to its subject. It relates to interstate commerce in its most primary sense-- the transportation of property from one state to another. It stands side by side with section 8 of that act, which gives to persons injured by rebates and unjust discriminations the right to recover damages therefor. It is, therefore, a 'law regulating commerce,' within the meaning of subdivision 8 of section 24 of the Judicial Code.

Do the suits 'arise under' section 20 of the Interstate Commerce Act? These words are found in the judicial article (article 3) of the federal Constitution, were used in the original Judiciary Act of 1789 (Act Sept. 24, 1789, c. 20, 1 Stat. 73), and have been a part of all subsequent statutes defining the jurisdiction of federal courts. Few subjects, however, are involved in greater perplexity than their meaning. Many criteria have been laid down for determining when a suit arises under federal law. They can be classified, but they cannot be harmonized. In the language of Chief Justice Marshall, a case 'may truly be said to arise under the Constitution or a law of the United States, whenever its correct decision depends on the construction of either' (Cohens v. Virginia, 6 Wheat. 379, 5 L.Ed. 257); or when 'the title or right, set up by the party, may be defeated by one construction of the Constitution or law of the United States, and sustained by the opposite construction' (Osborn v. Bank of United States, 9 Wheat. 822, 6 L.Ed. 204). And yet in the latter case it was held that a suit by or against a federal corporation was one arising under federal law-- a doctrine which has since been adhered to by the Supreme Court. Pacific R. R. Removal Cases, 115 U.S. 1, 5 Sup.Ct. 1113, 29 L.Ed. 319. It would, however, be difficult to conceive a case less likely to involve a construction of federal law than the ordinary suit by or against a federal corporation. A suit by or against a receiver of a national bank (Bartley v. Hayden (C.C.) 74 F. 913), or a receiver appointed by a federal court (Central Trust Co. v. East Tenn. V. & G. Ry. Co. (C.C.) 69 F. 353; State of Washington v. Northern Pacific R. Co. (C.C.) 75 F. 333), arises under the Constitution and laws of the United States, although as a rule such suits in no way involve a controversy as to the meaning of the federal Constitution or law. Suits to protect the rights of patentees under federal law are held to arise under the Patent Law, although many, possibly most, of them turn wholly upon questions of fact.

Counsel calls attention to the following language in Defiance Water Co. v. Defiance, 191 U.S. 184, 190, 24 Sup.Ct. 63, 66 (48 L.Ed. 140): 'When a suit does not really and substantially involve a dispute or controversy as to the effect or construction of the Constitution or laws of the United States, upon the determination of which the result depends, it is not a suit arising under the Constitution or laws. And it must appear on the record, by a statement in legal and logical form, such as is required in good pleading, that the suit is one which does really and substantially involve a dispute or controversy as to a right which depends on the construction of the Constitution or some law or treaty of the United States before jurisdiction can be maintained on this ground.'

Similar language has been used in other decisions. An examination of these cases, however, will generally show that the right asserted in the complaint was not a right created by federal law. On the contrary, such law was only indirectly and remotely concerned, and the right immediately in litigation was created by state law. Such were Gold Washing & Water Co. v. Keyes, 96 U.S. 199, 24 L.Ed. 656, and Shoshone Mining Co. v. Rutter, 177 U.S. 505, 20 Sup.Ct. 726, 44 L.Ed. 864. When the complaint discloses such a case, it becomes affirmatively clear that the suit does not arise out of federal law, and not only does not, but cannot properly, present a controversy as to the meaning of such law.

It cannot be that the jurisdiction of a suit originally brought in the District Court, or removed thereto, on the ground that it arises under the federal Constitution or law, must depend upon whether in the actual trial of the case a controversy will arise as to the effect or construction of the federal Constitution or law. That must be so, because it never can be determined from the complaint alone, upon which such jurisdiction is entirely dependent (Tennessee v. Union & Planters' Bank, 152 U.S. 454, 14 Sup.Ct. 654, 38 L.Ed. 511), that the case will actually involve a controversy as to the meaning of the federal Constitution or law. What controversy the case will present necessarily depends upon the issue raised by the answer. Though plaintiff bases his right upon federal law, the defendant may concede the law and the interpretation thereof asserted by the plaintiff, and raise only issues of fact.

So far as I am aware, the following is a correct affirmative rule Whenever federal law grants a right of property or of action, and a suit is brought to enforce that right, such a suit arises under the law creating the right, within the meaning of stat...