People v. Rath Packing Co.

• Citation: 85 Cal.App.3d 308,149 Cal.Rptr. 431
• Court: California Court of Appeals
• Decision Date: 04 October 1978
• Parties: The PEOPLE of the State of California, Plaintiff and Appellant, v. The RATH PACKING COMPANY, INC., Defendant and Respondent. The RATH PACKING COMPANY, Cross-Complainant and Respondent, v. M. H. BECKER as Director of the County of Los Angeles Department of Weights and Measures, Cross-Defendant and Appellant, C. B. Christensen as Director of Agriculture of the State of California, Intervener and Appellant. Civ. 42367, Civ. 43812.

Page 431

149 Cal.Rptr. 431

85 Cal.App.3d 308

The PEOPLE of the State of California, Plaintiff and Appellant, v. The RATH PACKING COMPANY, INC., Defendant and Respondent.

The RATH PACKING COMPANY, Cross-Complainant and Respondent, v. M. H. BECKER as Director of the County of Los Angeles Department of Weights and Measures, Cross-Defendant and Appellant, C. B. Christensen as Director of Agriculture of the State of California, Intervener and Appellant.

Civ. 42367, Civ. 43812.

Court of Appeal, Second District, Division 3, California.

Oct. 4, 1978.

Joseph P. Busch and John K. Van de Kamp, Dist. Attys., Harry B. Sondheim, Head, Appellate Division, and Eugene D. Tavris, Deputy Dist. Atty., Los Angeles, for plaintiff and appellant

John H. Larson, County Counsel, and Arnold K. Graham, Deputy County Counsel, Los Angeles, for cross-defendant and appellant M. H. Becker.

Evelle J. Younger, Atty. Gen., Carl Boronkay, Asst. Atty. Gen., and Herschel T. Elkins and Allan J. Goodman, Deputy Attys. Gen., for intervener and appellant C. B. Christensen.

Gibson, Dunn & Crutcher and Dean C. Dunlavey, Los Angeles, for defendant, cross-complainant and respondent The Rath Packing Co.

GOERTZEN, Associate Justice. ^*

These two appeals, involving virtually identical facts and issues of law, have been consolidated for consideration by this

court. In No. 42367, the People and others appeal from the granting of a motion for a preliminary injunction by the Los Angeles County Superior Court. In No. 43812, the same parties appeal from a judgment of that court granting declaratory relief and permanently enjoining them from enforcing certain provisions of California law against defendant Rath Packing Company (Rath). The effect of the granting of the permanent injunction was to render the appeal from the granting of the preliminary injunction moot, and we therefore dismiss the appeal in No. 42367. (People v. Gordon (1951) 105 Cal.App.2d 711, 725, 234 P.2d 287; 6 Witkin, Cal. Procedure (2d ed. 1971) Appeal, § 77, p. 4089.)

STATEMENT OF THE CASE

On March 1, 1972, the People, through the District Attorney of Los Angeles County, filed a complaint for an injunction, civil penalties and other relief against Rath, praying that Rath be enjoined from the advertising and sale of short-weighted packages of bacon and seeking the recovery of monetary damages as well.

The complaint alleged that the net weight of packaged bacon which was processed, labeled, sold and distributed by Rath was, when offered for retail sale to the consuming public during the period of October 21, 1971 to February 24, 1972, frequently found to be less than the net weight stated on the packages (i. e., one pound) and that "(d)efendant Rath, by its action in 'short-weighting' the contents of bacon packages as alleged . . ., intended to and has deceived, misled and otherwise induced substantial numbers of the consuming public into purchasing its bacon products."

The People further alleged that Rath, by packaging and selling "short-weighted" bacon to the public, was in violation of California laws proscribing (1) false advertising (Bus. & Prof. Code, § 17500), ¹ (2) unfair competition (Civ. Code, § 3369), ² and (3) misbranding (Health & Saf. Code, §§ 26550, 26551). ³

In its answer to the complaint, Rath alleged that "at all times mentioned in the complaint the average net weight of the contents of packages of bacon which Rath has processed, packaged, labeled and sold has been equal to or greater than the net weight stated on the face of the package At the time said packages leave Rath's plant." (Italics added.)

Rath also filed a counterclaim against the People and a cross-complaint against M. H. Becker, as Director of the County of Los Angeles Department of Weights and Measures (hereinafter "Becker"), in which Rath alleged (1) that the Federal Wholesome Meat Act (21 U.S.C. § 601 et seq.) and regulations adopted pursuant thereto require that weight statements on products packaged pursuant to said laws need only be accurate upon shipment from a federally inspected establishment, and (2) that the People and Becker were acting contrary to federal law when they enforced state laws which require that label weight statements be accurate At a time after they leave Rath's plants. In this regard, Rath further alleged in both its counterclaim and cross-complaint that "reasonable variation from the stated quantity of contents caused by loss of moisture during the course of good distribution practices or by unavoidable deviations in good manufacturing practice . . . is specifically recognized and allowed by the United States Department of Agriculture under 21 U.S.C. § 601(n) (5) and Title 9, C.F.R. § 317.2(h)(2)."

Through its cross-complaint, Rath sought declaratory and injunctive relief with respect to Becker's enforcement of net weight labeling requirements by the use of "off-sale orders."

Becker answered the cross-complaint, denying the material allegations thereof and alleging that in requiring true weight to consumers he had acted in accord with the Wholesome Meat Act and pursuant to California's police power.

On June 8, 1972, the superior court granted a preliminary injunction (the subject of appeal No. 42367) which prohibited Becker from ordering underweight packages of Rath's products off sale. In addition, Becker and his deputies, inspectors, officers, agents, and those acting in active concert or participation with him were restrained and enjoined from "imposing marking, labeling, packaging, or ingredient requirements in addition to, or different than, those made under the Wholesome Meat Act of 1967. . . ."

On July 7, 1972, the court below granted the motion of C. B. Christensen, as Director of Agriculture for the State of California (hereinafter "Christensen"), for leave to intervene and file a complaint and an answer in intervention. In his complaint in intervention, Christensen charged that Rath-packaged bacon contained less than the amount stated thereon and that the sale of such packages was in violation of Business and Professions Code sections 12024, ⁴ 12024.5, ⁵ 12211, ⁶ and 17500 (fn.1, Supra ) and Civil Code section 3369 (fn.2, Supra ). Christensen prayed for an injunction preventing Rath from violating these statutes.

On September 18, 1972, after obtaining leave of court, the People amended their complaint so as to increase the amount of civil penalties sought.

At the time the case was called for trial, Rath made a motion pursuant to Code of Civil Procedure section 597 for trial of the special defense that the causes of action alleged in the first amended complaint and in the complaint in intervention were barred by the prior judgment in Rath Packing Co. v. Becker (C.D.Cal.1973) 357 F.Supp. 529, claiming that the federal district court had held (1) that the People, Becker and Christensen cannot act under state law to enforce the federal standard, and (2) that Becker, Christensen and the People can enforce only the federal statutory scheme, nothing in addition thereto and nothing different therefrom. The court granted Rath's motion and eventually dismissed the first amended complaint and the complaint in intervention on the basis that they were barred by the prior federal decision, but refused to enter judgment thereon. The court proceeded to try the cross-complaint against Becker and Christensen over the requests of counsel for those parties to stay trial on Rath's cross-complaint pending a determination of the appeal of the court's dismissal of the complaint and the complaint in intervention. The court signed its judgment in Rath's favor on all matters on February 15, 1974, and judgment was entered on February 22, 1974. Among other things, the judgment: (1) declared that the People's first amended complaint and Christensen's complaint in intervention were barred by the res judicata effect of the prior federal district court's decision in Rath Packing Co. v. Becker, supra ; (2) permanently enjoined the enforcement of California laws pertaining to net weight labeling, including the regulatory scheme of Title 4, California Administrative Code, chapter 8, subchapter 2, articles 5 and 5.1, ⁷ except to the extent that such laws are applied in a manner consistent with the labeling requirements imposed by federal law; and (3) for all practical purposes, prohibited the further use of California's off-sale enforcement procedure. ⁸

On March 1, 1974, the People, Christensen and Becker's motion for a stay of judgment pending appeal was denied.

The People, Christensen and Becker (hereinafter sometimes referred to collectively as "appellants") each filed timely notices of appeal from the judgment (which is the subject of appeal No. 43812) and petitioned this court for a writ of supersedeas; the requested writ issued on March 22, 1974.

CONTENTIONS

Appellants make the following contentions:

1. The trial court erred in holding that the People's amended complaint and Christensen's complaint in intervention were barred by res judicata;

2. The court erred in holding that California has no power to enforce the provisions of the Wholesome Meat Act by means of state statutes, regulations, and sanctions;

3. The judgment is in error insofar as it provides that the applicable California statutes impose an unreasonable burden on interstate commerce;

4. The court erred in denying the state the power to prevent unfair competition;

5. There was insufficient evidence adduced at trial to support the court's finding that Rath's products complied with the applicable federal standards;

6. The court erred in holding that California's off-sale procedures deny Rath due process of law;

7. The court erred in refusing to enter judgment on the special defense of res judicata and in proceeding to trial on any other matter;

8. The court erred in granting Rath equitable relief.

DISCUSSION

As will become apparent, the resolution of many, if not all, of the issues raised by appellant...