National Labor Relations Bd. v. Santa Cruz Fruit P. Co., 8432.

• Citation: 91 F.2d 790
• Decision Date: 31 July 1937
• Docket Number: No. 8432.,8432.
• Parties: NATIONAL LABOR RELATIONS BOARD v. SANTA CRUZ FRUIT PACKING CO.
• Court: U.S. Court of Appeals — Ninth Circuit

91 F.2d 790 (1937)

NATIONAL LABOR RELATIONS BOARD v. SANTA CRUZ FRUIT PACKING CO.

No. 8432.

Circuit Court of Appeals, Ninth Circuit.

July 31, 1937.

Charles Fahy, Gen. Counsel, Robert B. Watts, Associate Gen. Counsel, Jerome I. Macht, Joseph Rosenfarb, A. Norman Somers, and Philip Levy, Attys., Nat. Labor Relations Board, all of Washington, D. C., for petitioner.

J. Paul St. Sure and E. H. Moore, both of Oakland, Cal., for respondent.

Before WILBUR, DENMAN, and HANEY, Circuit Judges.

DENMAN, Circuit Judge.

The National Labor Relations Board by its orders of April 2, 1936, required the respondent to "Cease and desist:

"(a) From discouraging membership in Weighers, Warehousemen and Cereal Workers, Local 38-44, International Longshoremen's Association, or in any other labor organization of its employees, by discharging or threatening to discharge any of its employees for joining Weighers, Warehousemen and Cereal Workers, Local 38-44, International Longshoremen's Association, or any other labor organization of its employees; and

"(b) From in any other manner discriminating against any of its employees in regard to hire or tenure of employment or any term or condition of employment for joining Weighers, Warehousemen and Cereal Workers, Local 38-44, International Longshoremen's Association, or any other labor organization of its employees; and

"(c) From in any other manner interfering with, restraining, or coercing its employees in the exercise of their rights of self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in concerted activities for the purpose of collective bargaining or other mutual aid or protection, as guaranteed in Section 7 of the National Labor Relations Act 29 U.S.C.A. § 157,"

and to take affirmative action, which the Board finds "will effectuate the policies of the Act," (a) to offer to several discharged employees "immediate and full reinstatement, respectively, to their former positions, without prejudice to any rights and privileges previously enjoyed"; and (b) to make whole said discharged employees "for any loss of pay they have suffered by reason of their discharge by payment to each of them, respectively, of a sum of money equal to that which each would normally have earned as wages during the period from the date of his discharge to the date of such offer of reinstatement, computed at the wage rate each was paid at the time of his discharge, less the amount earned subsequent to his discharge"; and to "post immediately notices to its employees in conspicuous places in its various offices, stating (1) that respondent will cease and desist in the manner aforesaid, and (2) that such notices will remain posted for a period of at least thirty (30) consecutive days from the date of posting."

The Board has filed its petition in this court for the enforcement of the orders. Respondent Packing Company appears and contests the enforcement.

The respondent admits it is engaged in the canning and packing of fruits and vegetables, 39 per cent. of which are processed to be sold to persons in other states and foreign countries and shipped to them there. Its total pack in 1935 was in excess of 1,600,000 cases. It consisted of tomatoes and tomato products, peaches, apricots, spinach, pears, asparagus, and pork and beans, in volume, in the order named.

The respondent, relying solely on the unconstitutionality of the Labor Relations Act (29 U.S.C.A. §§ 151-166) and the proceedings of the Board, does not question that the employees were dismissed by it because some of them had engaged in the formation of the local of the union in question and all had joined it. Upon the lockout, the local caused the Oakland plant to be picketed. Violence ensued, causing hospitalization of some of the participants. The product of the plant was declared "hot" and other locals of unions — teamsters, dock clerks, scalers, seamen, and longshoremen — failed or refused to handle it. Blacklisting of respondent's products was attempted.

The Board found that the "bulk of" the agricultural products processed by the respondent came from the State of California, and the respondent contends, and we accept the contention, that substantially all of the products were produced by growers in the state. Respondent further contends, and we agree with the contention for the purposes of this decision, that the processing of the respondent, including the loading of its product in cars, is an intrastate activity as that is held to be in the Coe v. Errol Case, 116 U.S. 517, 518, 525, 6 S.Ct. 475, 29 L.Ed. 715.

The contention also was raised that under the agreements for the sale of the products, title was transferred to the purchaser prior to the actual entry of the goods into carriage by an interstate carrier, which contention we also accept for the purposes of this decision.

It appears that the respondent had two plants; one at Oakland, California, known as the "Santa Cruz plant," and one at Seabright, near Santa Cruz, Cal. The case as presented here concerns only the employees engaged at the Oakland plant and there is no showing that any of the products of the Seabright plant ever left the State of California.

We hold that so far as concerns the manufacture and shipping activities of the respondent and its employees at the Oakland plant, the labor dispute leading to the discharge of the employees, the declaration of the products as "hot," and the sympathetic refusal of other unions to handle them, "throttled" the flow of interstate commerce and "put in jeopardy" its future flow, to the extent of the 39 per cent. of respondent's products manufactured to be shipped into that commerce.

The respondent relies on the decisions of Carter v. Carter Coal Co., 298 U.S. 238, 56 S.Ct. 855, 80 L.Ed. 1160; United Mine Workers v. Coronado Coal Co., 259 U.S. 344, 42 S.Ct. 570, 66 L.Ed. 975, 27 A.L.R. 762; Oliver Iron Mining Co. v. Lord, 262 U.S. 172, 43 S.Ct. 526, 67 L.Ed. 929; and others holding that manufacture, lumbering, and mining processes, including the loading on to the cars of the product, and all activities up to actual movement out of the state, as in the Coe Case, constitute intrastate production. Hence, the respondent contends, the Labor Relations Act is an attempt by the Congress to control the labor relations in such an intrastate activity and violates the provisions of the Tenth Amendment to the Constitution.

The questions for our solution are:

(1) Is the Carter v. Carter Coal Co. decision overruled by the decision of the Supreme Court in National Labor Relations Board v. Jones & Laughlin Steel Corporation, 57 S.Ct. 615, 81 L.Ed. ____, 108 A.L.R. 1352, so far as the former holds that the Constitution gives no power to the Congress to regulate intrastate production and manufacture of goods with respect to its labor disputes, which diminish or throttle the flow of goods intended to be and which would be shipped into interstate commerce?

(2) Granting the Congress has such power, can it be exercised where 39 per cent. of the goods produced by the labor employed are shipped in interstate commerce and 61 per cent. remain within the state of manufacture?

(1) Carter v. Carter Coal Co. and similar cases are overruled by National Labor Relations Board v. Jones & Laughlin Steel Corporation.

Respondent's contention that the Carter Case is not overruled by the Jones & Laughlin decision is squarely presented to this court and it would be an evasion of our judicial obligation to deny it a full consideration or attempt to evade it by asserting that it is here "not controlling."

Three circuits, the Second, Fifth, and Sixth, relied upon the principle established in the Carter Case in holding that the National Labor Relations Act was unconstitutional. National Labor Relations Board v. Friedman-Harry Marks Clothing Co. (C.C. A.2) 85 F.(2d) 1, 2; National Labor Relations Board v. Jones & Laughlin Steel Corp. (C.C.A.5) 83 F.(2d) 998, 999; Fruehauf Trailer Co. v. National Labor Relations Board (C.C.A.6) 85 F.(2d) 391, 392.

In all three of these cases there was an antecedent import of raw materials entering into the production, over which the Labor Relations Board asserted the right to regulate the employer and employee. Here, the respondent asserts, is a case identical with the Carter Coal Case, in what, it insists, is the controlling fact that, as in mining coal, both the fruit and vegetables and the canned and packed product are produced in the state.

It is patent that the Carter case is identical in fact and relevant principle with that of respondent.

Unless overruled it clearly is controlling in so far as it denies the constitutional right of the Congress to regulate labor disputes affecting substantially the volume of a manufacturer's output which is "to be" transported in interstate commerce and which may be throttled from that transport and ultimate sale in another state unless so regulated.

Great stress is laid on the fact that the Congress has not before exercised such a power over labor relations in production of goods to be transported into interstate commerce. It is argued that if it may regulate labor disputes because it will affect the volume of goods to be transported in interstate commerce, it may regulate the volume itself of, say, shoes or clothing or furniture or food products, or the material used in the construction of housing, produced for use in other states. It is urged that all such production generally has been conceived as a matter of state control, and there are pointed out dangers of political control of such matters by bureaus in Washington. It is suggested that the Constitution was framed to meet a pioneer agricultural economy in which nearly everything consumed was grown or made on the farms or in the neighboring towns. Hence it is further urged that the framers of the Constitution never would have lodged in the...