Oklahoma Press Pub. Co. v. Walling

• Citation: 147 F.2d 658
• Decision Date: 15 February 1945
• Docket Number: No. 3036.,3036.
• Parties: OKLAHOMA PRESS PUB. CO. v. WALLING, Administrator of the Wage and Hour Division.
• Court: United States Courts of Appeals. United States Court of Appeals (10th Circuit)

147 F.2d 658 (1945)

OKLAHOMA PRESS PUB. CO. v. WALLING, Administrator of the Wage and Hour Division.

No. 3036.

Circuit Court of Appeals, Tenth Circuit.

February 15, 1945.

Elisha Hanson, of Washington, D. C. (Joseph C. Stone and Charles A. Moon, both of Muskogee, Okl., on the brief), for appellant.

Douglas B. Maggs, of Washington, D. C. (Bessie Margolin, of Washington, D. C., Llewellyn B. Duke, of Dallas, Tex., and Flora G. Chudson, of Washington, D. C., on the brief), for appellee.

Before PHILLIPS, BRATTON, and MURRAH, Circuit Judges.

MURRAH, Circuit Judge.

The primary question presented by this appeal is whether the Administrator of the Wage and Hour Division of the Fair Labor Standards Act, 52 Stat. 1060, 29 U.S. C.A. § 201 et seq. is entitled to an order of the District Court enforcing an investigatory subpoena, issued by the Administrator in pursuance of Section 9 of the Act, for the purposes enumerated in Section 11(a) thereof, without a prior adjudication by the court to the effect that the industry or activity sought to be investigated by the subpoena is subject to and covered by the provisions of the Fair Labor Standards Act, and if so, what considerations govern the court in the enforcement of the subpoena.

Section 11(a) of the Act authorizes the Administrator to "investigate and gather data regarding the wages, hours, and other conditions and practices of employment in any industry subject to this Act, and he may enter and inspect such places and such records (and make such transcriptions thereof), question such employees, and investigate such facts, condiditions, practices, or matters as he may deem necessary or appropriate to determine whether any person has violated any provision of this Act." Section 11(c) requires every employer subject to any provision of the Act to make and keep records of wages, hours, and other conditions of employment and to make reports therefrom, as prescribed by regulations of the Administrator, "necessary or appropriate for the enforcement of the provisions of the Act."

When permission to "enter and inspect", as authorized by Section 11(a), is denied to the Administrator or his subordinates, the Administrator is authorized by Section 9 of the Act (which adopts sections 9 and 10 of the Federal Trade Commission Act, 38 Stat. 717, 15 U.S.C.A. §§ 49, 50) to issue a subpoena requiring the attendance and testimony of witnesses and the production of all documentary evidence relevant to any matter under investigation authorized by Section 11(a), at any designated place of hearing. In the event of disobedience to the subpoena, the Administrator may invoke the aid of any court of the United States having jurisdiction of the subpoenaed party, and such court may issue an order requiring the recalcitrant witness to obey the subpoena. Failure to obey such order of the court is punishable as a contempt thereof.

After being denied permission to examine the books and records of the appellant, Oklahoma Press Publishing Company, under Section 11(a) of the Act, the Administrator issued a subpoena duces tecum, directed to the appellant, requesting the production of "books, papers, and documents showing the hours worked by, and wages paid to, each of your employees between October 29, 1938, and the date hereof, including all payroll ledgers, time sheets and cards, and time clock records, and all your books, papers and documents showing the distribution of papers, out of the state of Oklahoma, the dissemination of news outside of the state of Oklahoma, and the source and receipt of advertisements of nationally advertised goods". Acting upon the belief that neither it nor its employees were "subject to the Act", appellant refused to obey the subpoena, whereupon the Administrator applied to the District Court for an order compelling obedience as authorized in Section 9.

The application alleged on information and belief that the appellant, as publisher of two daily newspapers, was engaged in commerce or in the production of goods for commerce within the meaning of the Act, and that all the books, records, papers and documents referred to in the subpoena were "relative, material, and appropriate" to determine whether the company had violated the Act, and would "aid in the enforcement of the provisions of the Act". By answer to the show cause order, appellant alleged that neither it nor any of its employees were engaged in commerce or in the production of goods for commerce; that a forced investigation would be an unreasonable search and seizure, and, moreover, any attempted regulation of its business violated the freedom of the press. In the alternative, it was alleged that if appellant or any of its employees are engaged in commerce or in the production of goods for commerce, as a newspaper publisher, it is a service establishment as defined by Section 13(a) (2) of the Act and therefore exempt from its coverage.

The application for the enforcement order was submitted to the trial court upon the foregoing pleadings and accompanying affidavits. Upon the facts thus established and on authority of Sun Publishing Company v. Walling, 6 Cir., 140 F.2d 445, the trial court adjudged the appellant "subject to the Wage and Hour Act", and upon this premise ordered appellant to comply with the subpoena.

On appeal appellant makes the contention that compulsory obedience to the investigatory subpoena constitutes an unreasonable search and seizure, unless the court first adjudicates the question of coverage, and that the summary proceedings pursuant to which the trial court ordered obedience to the subpoena did not afford it an opportunity to have the question of coverage determined in a full and complete proceedings conducted for that purpose. In other words, it is argued that the appellant may bar the investigator at the threshold until it is conclusively shown that the matters and things sought to be investigated by the subpoena are within the scope of the Act, which authorizes its issuance. Relying upon Endicott Johnson v. Perkins, 317 U.S. 501, 63 S.Ct. 339, 87 L.Ed. 424, the Administrator makes the contention that he is entitled, as of right, to an order of enforcement upon the bare allegations contained in his application for the order, without any further showing of coverage — that any less expeditious assistance would greatly hinder the effectuation of the purposes of the Act. It is further urged that in any event, the showing made in the summary proceedings was entirely sufficient to justify the order of enforcement.

In order to effectuate the purposes of the Act, the Administrator is authorized to "enter", "inspect" and "investigate", and when denied permission he may issue a subpoena requiring the appearance and testimony of witnesses, and the production of the documentary evidence sought to be inspected, but the Administrator has no power to compel obedience to the subpoena — such powers have historically resided in the courts as an appropriate exercise of a judicial function.¹ Interstate Commerce Commission v. Brimson, 154 U.S. 447, 14 S.Ct. 1125, 38 L.Ed. 1047. Like most acts of similar import (see footnote 1), Section 9, 15 U.S.C.A. § 49, which confers jurisdiction, provides that the court "may * * * issue an order requiring" obedience to the subpoena.² "The language is not mandatory, but permissive." Mississippi Road Supply v. Walling, 6 Cir., 136 F.2d 391, 394. It clearly envisages a judicial act, and in the classical words of Judge Johnsen of the Eighth Circuit, "judicial enforcement necessarily is the exercise of judicial power, and judicial function can never wholly escape the test of judicial responsibility." Walling v. Benson, 137 F.2d 501, 504.

Endicott Johnson Corp. v. Perkins, supra, involved the relationship of the courts to the subpoena power of the Secretary of Labor under Section 4 of the Walsh-Healey Public Contracts Act. The Circuit Court of Appeals, 2 Cir., 128 F.2d 208, and the Supreme Court, 317 U.S. 501, 63 S.Ct. 339, 87 L.Ed. 424, held that in the circumstances, the District Court should have enforced the subpoena, but we do not understand that in so holding it intended to sweep away all power of judicial discretion. In reaching its decision, the court noted that the Walsh-Healey Act had peculiar application to those doing business by voluntary contract with the United States Government; that under its provisions the issue of coverage was primarily the duty of the Secretary of Labor and not the courts, and that since the evidence sought by the subpoena was not plainly incompetent or irrelevant to the discharge of that lawful function, it was the duty of the court to order the production of the records sought by the subpoena. Unlike the Walsh-Healey Act, the ultimate issue of coverage under the Fair Labor Standards Act is a judicial question committed to the courts and not to the Administrator. We do not think that the philosophy of Endicott Johnson Corp. v. Perkins, supra, is authority for the contention of the Administrator to the effect that the courts are deprived of the power of discretion in the performance of the judicial function expressly committed to them and denied to the Administrator.

It is, of course, fundamental that any invasion or intrusion upon the privacy of an individual's business or home must have the sanction of both constitutional and legislative authority, and any process issued for that purpose must confine its requirements within the limits which reason would impose under the circumstances of the case. Bowles v. Beatrice Creamery Co., 10 Cir., 146 F.2d 774; Shotkin v. Nelson, 10 Cir., 146 F.2d 402; McGarry v. Securities and Exchange Commission, 10 Cir., 147 F.2d 389; Fleming v. Montgomery Ward & Co., 7 Cir., 114 F.2d 384; Wilson v. United States, 221 U.S. 361, 31 S.Ct. 538, 55 L.Ed. 771, Ann.Cas.1912D, 558; Essgee Co. v. United States, 262 U.S. 151, 43 S.Ct. 514, 67 L.Ed. 917; Federal Trade Commission v. American Tobacco Co., ...