Merchants' Stock & Grain Co. v. Board of Trade of City of Chicago

• Citation: 187 F. 398
• Decision Date: 27 April 1911
• Docket Number: 3,404.
• Parties: MERCHANTS' STOCK & GRAIN CO. et al. v. BOARD OF TRADE OF CITY OF CHICAGO et al.
• Court: U.S. Court of Appeals — Eighth Circuit

187 F. 398

MERCHANTS' STOCK & GRAIN CO. et al. v. BOARD OF TRADE OF CITY OF CHICAGO et al.

No. 3,404.

United States Court of Appeals, Eighth Circuit.

April 27, 1911

Syllabus by the Court.

Contempts are of two classes: 'Criminal contempts,' which are prosecuted to preserve the power and vindicate the dignity of the courts and to punish the offender; and 'civil contempts,' which are prosecuted to preserve and enforce the rights of private parties and to compel obedience to orders and decrees to enforce the rights and administer the remedies to which the court has found or may find the private parties to be entitled.

A judgment for a criminal contempt committed in the progress of a suit in equity is reviewable by writ of error only.

A judgment that the defendants in a pending equity suit are guilty of contempt of court for the violation of an interlocutory injunction issued against them at the instance of the complainant, and that they pay fines therefor three-fourths to the complainant and one-fourth to the government, is for a civil contempt, and is reviewable by appeal from the final decree only, because the chief purpose of the proceeding is to prevent irreparable injury to the complainant and to preserve its property pendente lite because the complainant is the party chiefly interested in it and the party that commenced and conducted the proceedings for the contempt, because the proceeding is for an act done by parties to a suit in disobedience of a special order made in behalf of their opponent in that suit, and because the dominant effect as well as the object of the proceeding is to coerce the defendants to obey the injunction for the purpose of preserving the property of the complainant, and the punitive element in it is subordinate, incidental, and negligible.

Chester H. Krum and Henry S. Priest, for plaintiffs in error.

Henry S. Robbins (Martin H. Foss and Sears Lehmann, on the brief) for defendants in error.

Before SANBORN and ADAMS, Circuit Judges, and WILLIAM H. MUNGER, District Judge.

SANBORN Circuit Judge.

The plaintiffs in error complain that they were found guilty of contempt of court and fined for a violation of an interlocutory injunction issued in a pending suit in equity brought against them by the Board of Trade of Chicago. As the suit in equity has not passed to final decree, the first question is whether or not the judgment of contempt is reviewable by writ of error; for the rule is well settled that, while a judgment for a criminal contempt may be challenged by a writ of error (Act March 3, 1891, c. 517, Sec. 6, 26 Stat. 828 (U.S. Comp. St. 1901, pp. 549, 550); Bessette v. W. B. Conkey Company, 194 U.S. 324, 338, 24 Sup.Ct. 665, 48 L.Ed. 997; Matter of Christensen Engineering Co., 194 U.S. 458, 461, 24 Sup.Ct. 729, 48 L.Ed. 1072), a judgment against a party to a suit in equity for a civil contempt is reviewable by appeal only (Doyle v. London Guarantee Company, 204 U.S. 599, 602, 603, 605, 607, 27 Sup.Ct. 313, 51 L.Ed. 641; Ex parte Heller, 214 U.S. 501, 502, 29 Sup.Ct. 698, 53 L.Ed. 1060; Webster Coal Co. v. Cassatt, 207 U.S. 181, 28 Sup.Ct. 108, 52 L.Ed. 160; Clay v. Waters, 101 C.C.A. 645, 178 F. 385, 391, 392).

The injunction in this case was issued at the instance of the Board of Trade, to protect it from irreparable injury until the final decree could be rendered in the suit. The defendants in the suit, the plaintiffs in error here, must be assumed, for the purpose of the decision of this preliminary question, to have violated this injunction, and to have inflicted serious injury upon the Board while the suit was pending, and the court fined them for these unlawful acts, and ordered three-fourths of the fines to be paid to the Board and one-fourth thereof to the United States.

Counsel for the defendants below argue that this is a judgment for a criminal contempt, because one-fourth of the fines are to be paid to the United States, and because the true line of demarcation between civil contempts and criminal contempts in their opinion was drawn by the Supreme Court of South Dakota in State v. Knight, 3 S.D. 509, 514, 54 N.W. 412, 413, 44 Am.St.Rep. 809, and the contempt here in question falls on the criminal side of that line. That court said:

'If the contempt consists in the refusal of a party to do something which he is ordered to do for the benefit or advantage of the opposite party, the process is civil, and he stands committed until he complies with the order. * * * If, on the other hand, the contempt consists in the doing of a forbidden act, injurious to the opposite party, the proceeding is criminal, and conviction is followed by fine or imprisonment, or both; and this is by way of punishment. * * * This rule, as definitely stated, has not been expressly recognized by any case coming under our observation, but it is consistent with all the decisions.'

The opinion from which these quotations are made was written in the year 1893. While the line of demarcation there drawn may not have been inconsistent with any opinions coming under the eyes of the Supreme Court of South Dakota at that time, it is inconsistent with the later decisions of the Supreme Court of the United States. In Exparte Heller, 214 U.S. 501, 29 Sup.Ct. 698, 53 L.Ed. 1060, Heller had been enjoined from using a certain trade-mark and from stamping waistbands in a certain manner, and the court that rendered the decree had adjudged him to be in contempt for violating the injunction, and had fined him $500. He had sued out a writ of error to the Circuit Court of Appeals of the Second Circuit, and that court had dismissed his writ, on the ground that the contempt was not criminal. Heller had then applied to the Supreme Court for a mandamus to compel the Court of Appeals to take jurisdiction of and to decide his case on the merits of the writ of error, and the Supreme Court dismissed his petition, after quoting from the opinion of the Court of Appeals this declaration:

'It is well settled that, when an order imposing a fine for a violation of an injunction is substantially one to reimburse the party injured by the disobedience, it is to be reviewed only by appeal.'

The truth is that substantial benefit to a private party preponderating over that to the government is the distinguishing characteristic of a civil contempt, and that benefit is often as great and it arises as frequently from judgments for contempts for disobedience of a prohibitory as of a mandatory order or judgment. In view of this fact, and of the decisions of the Supreme Court which have been cited, we adhere to our earlier statement of the nature and of the distinction between criminal and civil contempts which was made in Re Nevitt, 54 C.C.A. 622, 632, 117 F. 448, 458, was approved by the Supreme Court in Bessette v. W.B. Conkey Company, 194 U.S. 324, 328, 24 Sup.Ct. 665, 48 L.Ed. 997, and was affirmed by this court in Clay v. Waters, 101 C.C.A. 645, 178 F. 385, 389, which reads:

'Proceedings for contempts are of two classes-- those prosecuted to preserve the power and vindicate the dignity of the courts and to punish for disobedience of their orders, and those instituted to preserve and enforce the rights of private parties to suits and to compel obedience to orders and decrees made to enforce the rights and administer the remedies to which the court has found them to be entitled. The former are criminal and punitive in their nature, and the government, the courts, and the people, are interested in their prosecution. The latter are civil, remedial, and coercive in their nature, and the parties chiefly in interest in their conduct and prosecution are the individuals whose private rights and remedies they were instituted to protect or enforce. Thompson v. Railroad Company, 48 N.J.Eq. 105, 108 (21 A. 182); Hendryx v. Fitzpatrick (C.C.) 19 F. 810; Ex parte Culliford, 8 Barn. & C. 220; Rex v. Edwards, 9 Barn. & C. 652;

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