Mitchell v. Owen

• Decision Date: 30 June 1961
• Docket Number: 14223.,No. 14161-14163,14161-14163
• Citation: 292 F.2d 71
• Parties: James P. MITCHELL, Secretary of Labor, U. S. Department of Labor, Appellant, v. Clyde W. OWEN, an individual, d/b/a Clyde Owen Sand & Gravel Co., Appellee. James P. MITCHELL, Secretary of Labor, U. S. Department of Labor, v. Clyde W. OWEN.
• Court: U.S. Court of Appeals — Sixth Circuit

292 F.2d 71 (1961)

James P. MITCHELL, Secretary of Labor, U. S. Department of Labor, Appellant, v. Clyde W. OWEN, an individual, d/b/a Clyde Owen Sand & Gravel Co., Appellee.

James P. MITCHELL, Secretary of Labor, U. S. Department of Labor, v. Clyde W. OWEN.

Nos. 14161-14163, 14223.

United States Court of Appeals Sixth Circuit.

June 30, 1961.

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Robert E. Nagle, Dept. of Labor, Washington, D. C. (Harold C. Nystrom, Bessie Margolin, Washington, D. C., and Jeter S. Ray, Regional Atty., Nashville, Tenn., on the brief), for appellant.

Walter P. Armstrong, Jr., Memphis, Tenn. (of Armstrong, McCadden, Allen, Braden & Goodman), Memphis, Tenn., John Tipton (of Tipton & Tipton), Covington, Tenn., for appellee.

Before CECIL, WEICK and O'SULLIVAN, Circuit Judges.

O'SULLIVAN, Circuit Judge.

Appellee Owen, an individual engaged in the sand and gravel business in the State of Tennessee, was charged in the district court with violating the minimum wage, overtime compensation, and record keeping requirements of the Fair Labor Standards Act, 29 U.S.C.A. §§ 201-219. Owen, who employs some twenty workmen, mines, processes and sells sand, gravel and road gravel. His only place of business is located in Tennessee. All of his production activities take place in that state. All of such materials were sold, delivered and used in that state. The Secretary of Labor brought the four instant suits against Owen, alleging that Owen's employees were engaged in the production of goods for commerce within the meaning of Section 3(j) of the Fair Labor Standards Act, 29 U.S.C.A. § 203(j).

The facts which, according to the Secretary (and these facts are undisputed), give rise to coverage in Owen's case are these: Between October 22, 1956, and December 10, 1958,¹ Owen sold a total of 460,975.9 cubic yards of sand, gravel and road gravel. Of this total amount, approximately 22.6 percent was sold for use in various constructions at the Millington Naval Air Station. About one-fourth of this material was sold directly to contractors who were engaged in constructing taxiways and making runway repairs at the Air Station. The balance of the materials supplied by Owen for use at the Air Station was used for overlays on existing aircraft parking aprons and for the building of a parking area. The construction of these overlays and of the parking area was to be performed by Weymouth Construction Co. in four stages. To obtain the necessary sand and gravel for the performance of the first stage, Weymouth contracted directly with Owen, who delivered such material to the air base. For the other three stages, Weymouth contracted with John A. Denie's Sons Co., who in turn arranged with appellee to provide the materials needed. In accordance with this latter arrangement, Owen delivered 76,770.4 cubic yards of sand and gravel directly from Owen's pits to the Air Station in trucks hired by Owen. From May, 1957, to September, 1958, Owen delivered between ten thousand and thirteen thousand truck loads of material to the Air Station and billed Denie's $219,471.00 for such materials.

Apart from the material sold for use at the Air Station, Owen sold about 72,696 cubic yards of sand and gravel (approximately fifteen percent of his total production during the period here in question — note 1, supra) for use in several road and highway construction projects. Of this amount, 48,069.6 cubic yards were sold to contractors doing work on Tennessee state highways, 17,887 cubic yards to contractors working on "rural roads," and 6,739.4 cubic yards to the L & M Construction Co., which was used in the construction of bridges for a new southbound lane for U. S. Highway 51.

Three of the four suits instituted by the Secretary were brought under Section 16(c) of the Act, 29 U.S.C.A. § 216 (c), to recover unpaid minimum wages and overtime compensation due four of Owen's employees. The other suit was brought pursuant to Section 17 of the Act, 29 U.S.C.A. § 217, to obtain injunctive relief restraining Owen from violating the Act in the future. In the district court, noncompliance with the Act's minimum wage, overtime and record keeping provisions was admitted. The correctness of the amounts claimed in the wage suits, provided coverage was found to exist, was also not disputed by Owen. The point of contest was whether Owen's employees were protected by the Act during the periods in question. Two of the wage suits (Nos. 14,162 and 14,163) were tried to a jury and resulted in judgments for Owen. In the injunction suit (No. 14,161) the district court denied the injunction sought and dismissed the complaint. The other wage suit (No. 14,223) was subsequently dismissed in summary judgment proceedings on the ground that the coverage issue had already been determined in favor of Owen in Cases 14,161, 14,162 and 14,163 and was res adjudicata.

Sections 6 and 7 of the Act, 29 U.S. C.A. §§ 206, 207, the minimum wage and overtime compensation provisions protect employees "engaged in commerce or in the production of goods for commerce." It is the "production of goods for commerce" category which concerns us here. That category embraces all employees engaged in "producing, manufacturing, mining, handling, transporting, or in any other manner working on such goods, or in any closely related process or occupation directly essential to the production thereof * * *." Fair Labor Standards Act, § 3(j), 29 U.S.C.A. § 203(j).

It is settled law that the production of materials for use in the improvement, extension, maintenance or repair of existing facilities or instrumentalities of interstate commerce constitutes the production of goods for commerce within the meaning of Section 3 (j) of the Act, 29 U.S.C.A. § 203(j). Alstate Construction Co. v. Durkin, 1953, 345 U.S. 13, 73 S.Ct. 565, 97 L.Ed. 745; Thomas v. Hempt Bros., 1953, 345 U.S. 19, 73 S.Ct. 568, 97 L.Ed. 751; Emulsified Asphalt Products Co. v. Mitchell, 6 Cir., 1955, 222 F.2d 913; Mitchell v. Hooper Equipment Co., 5 Cir., 1960, 279 F.2d 893; Mitchell v. Raines, 5 Cir., 1956, 238 F.2d 186; Compania de Ingenieros Y Contratistas, Inc., v. Goldberg, 1 Cir., 1961, 289 F.2d 78. The fact that Owen was an independent materialman who himself did no construction work is not significant here. Thomas v. Hempt Bros., 1953, 345 U.S. 19, 73 S.Ct. 568, 97 L.Ed. 751. It might be contended, however, with respect to the materials produced by Owen for use at the Air Station, that because he sold some of such materials to Denie's & Sons Co., who, in turn, sold them to Weymouth, the contractor working at the Air Station, Owen was insulated from the Act's coverage. Whatever validity this type argument may have in another case is vitiated here by the fact, apparent from the record, that from the moment of the first act of mining the sand and gravel until the delivery of the materials to the Air Station (in trucks hired by Owen) substantial portions of such production were intended for, and committed to, use in construction at the Air Station. See Mitchell v. Jaffe, 5 Cir., 1958, 261 F.2d 883.

That the production and the use of the materials both occur in the same state is of no legal consequence, if the materials were produced for use in work upon instrumentalities of commerce. Emulsified Asphalt Products Co. v. Mitchell, 6 Cir., 1955, 222 F.2d 913; Alstate Construction Co. v. Durkin, 1953, 345 U.S. 13, 73 S.Ct. 565, 97 L.Ed. 745; Archer v. Brown & Root, Inc., 5 Cir., 1957, 241 F.2d 663. The question first to be decided, therefore, is whether the Air Station and the various roads in which the sand and gravel were used are instrumentalities of interstate commerce.

Owen contends that although it is possible for a military installation, such as the Naval Air Station here involved, to become an instrumentality of commerce see Powell v. United States Cartridge Co., 1949, 339 U.S. 497, 70 S. Ct. 755, 94 L.Ed. 1017 it can become so only if commercial transactions are involved in the interstate flights which admittedly take place daily to and from the Air Station. He insists that since no buying and selling of tickets or waybills is involved here, and since no "goods" as defined in Section 3(i) of the Act, 29 U.S.C.A. § 203(i), pass through the Air Station, the jury properly found that it was not an instrumentality of commerce. The mandate of the Supreme Court is that military air bases are facilities of commerce, "to the extent that interstate flights both land at and take off from them, and men, materials, and mail move through them from distant points." Mitchell v. Lublin, McGaughy & Associates, 1959, 358 U.S. 207, 213, 79 S.Ct. 260, 265, 3 L.Ed.2d 243. Since it is not disputed that interstate flights in fact take place to and from Millington Air Station and that on these flights men and cargo are transported across state lines, the Air Station, as a matter of law, is an instrumentality of commerce. We are of the opinion that the jury should have been so instructed, as requested by plaintiff. Plaintiff's request that the jury be told that the parking aprons, taxiways and runways of the Air Station were also instrumentalities of such commerce should have been granted. The decision of the Supreme Court in Mitchell v. Lublin, McGaughy & Associates, supra, makes it irrelevant that some of the materials which arrived at the Air Station were in the "actual physical possession of the ultimate consumer thereof." 29 U.S.C.A. § 203(i). That men, who clearly cannot come within the exclusionary clause of Section 3(i) of the Act 29 U.S.C.A. § 203(i), were transported to and from the Air Station is sufficient. The district court's inclusion in his instructions of the substance of Section 3 (i) introduced an irrelevant subject, and such an instruction should not have been given. See also this Court's decision in Chapman v. Home Ice Co., 6 Cir., 1943, 136 F.2d 353, 355.

Part of Owen's production was delivered to a job which...