RC Tway Coal Co. v. Glenn

• Citation: 12 F. Supp. 570
• Decision Date: 14 November 1935
• Docket Number: No. 996,997,808.,996
• Parties: R. C. TWAY COAL CO. et al. v. GLENN et al. CLARK v. R. C. TWAY COAL CO. et al. BALTIMORE TRUST CO. v. NORTON COAL MINING CO.
• Court: U.S. District Court — Western District of Kentucky

12 F. Supp. 570

R. C. TWAY COAL CO. et al. v. GLENN et al.

CLARK v. R. C. TWAY COAL CO. et al.

BALTIMORE TRUST CO. v. NORTON COAL MINING CO.

Nos. 996, 997, 808.

District Court, W. D. Kentucky.

November 14, 1935.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

In case No. 996:

Woodward, Dawson & Hobson, of Louisville, Ky., for plaintiffs.

Bunk Gardner, U. S. Dist. Atty., and Oldham Clarke, Asst. U. S. Dist. Atty., both of Louisville, Ky., and John Dickinson, Asst. Atty. Gen., and John S. L. Yost and Carl McFarland, Sp. Assts. to the Atty. Gen., for defendant.

In case No. 997:

Selligman, Goldsmith, Everhart & Greenebaum, of Louisville, Ky., for plaintiff.

Woodward, Dawson & Hobson, of Louisville, Ky., for defendant.

Bunk Gardner, U. S. Dist. Atty., and Oldham Clarke, Asst. U. S. Dist. Atty., both of Louisville, Ky., amicus curiae.

In case No. 808:

Frank M. Drake, of Louisville, Ky., for petitioner.

HAMILTON, District Judge.

The three above-styled causes relate to the same subject-matter, and for that reason this opinion is applicable to all of them, although they have not been consolidated for hearing.

The first suit is an action (Equity No. 996) instituted by nineteen corporations, all of them miners and producers of bituminous coal in the Eastern Kentucky coal field, and together they represent all the producers of any substantial size in that district except the producers of captive coal.

The plaintiffs state that Selden R. Glenn, defendant, is a citizen of the commonwealth of Kentucky, residing in Louisville, Jefferson county, in the Western district of Kentucky, and the duly appointed, qualified, and acting collector of internal revenue for the district of Kentucky, and as such collects all taxes, assessments, and levies made or attempted to be made by the United States which are collectible in Kentucky through the Internal Revenue Department.

This suit is one of a civil nature, arising under the Constitution and laws of the United States, and presents an actual controversy between each of the plaintiffs and the defendant, and the amount involved exceeds $3,000.

The plaintiffs, after setting out the provisions of Public No. 402, 74th Cong., H. R. 9100 (15 USCA § 801 et seq.) "An Act To stabilize the bituminous coal-mining industry," claim it is unconstitutional and void on the following grounds:

Section 4 of the act (15 USCA § 805) requires the formulation by the National Bituminous Coal Commission, composed of five members appointed by the President, of a working agreement to be known as the "Bituminous Coal Code," such code to deal with matters enumerated in section 4 (15 USCA §§ 805-808) and to otherwise conform to the provisions and requirements of that section. The entire bituminous coal producing area of the United States, by section 4, is divided into nine minimum price areas, and further into twenty-three producing districts, each area embracing one or more producing district. Section 4 provides that the code required to be established in accordance with its terms shall be administered and enforced by the Commission, as to all matters other than labor relations between the producers and their employees, through district boards selected by each of the twenty-three districts in the manner therein provided; and as to labor relations, by the Commission through a Bituminous Coal Labor Board of three members, appointed by the President of the United States by and with the advice and consent of the Senate (15 USCA § 808 (c). Each district board, subject to the supervision and approval of the Commission, is required to immediately establish minimum prices free on board transportation facilities at the mines for all kinds, qualities, and sizes of coal produced in their respective jurisdictions, with full authority in establishing such minimum prices to make such classifications of coals and price variations as to mines and consuming market areas as it may deem necessary and proper.

It is further provided that in order to sustain stabilization of wages, working conditions, and maximum hours of labor, such minimum prices shall be established so as to yield a return per net ton for each district in its minimum price area, equal as nearly as may be to the weighed average of the total costs per net ton to be determined according to the formula attempted to be set up in said section. The district boards are further required under the rules and regulations established by the Commission and subject to the supervision and approval of the Commission, to co-ordinate in common consuming market areas upon a fair competitive basis, the minimum prices, and the rules and regulations established by them for their respective districts, and in effecting such co-ordination such district boards are required to take into account the factors set out and the rules attempted to be laid down in said section.

Said section 4 (15 USCA § 807 (c) authorizes the Commission, whenever it deems necessary in order to protect the consumer of coal against unreasonably high prices, to fix maximum prices free on board transportation facilities for coal in any district, such maximum prices to be established in accordance with the formula therein attempted to be set out.

All contracts for the sale of coal below minimum or above maximum therefor approved and established by the Commission and in effect at the time of the making of the contract are declared by such section to be invalid and unenforceable, and after the date of the approval of the act, and until the minimum prices have been established as therein provided, producers accepting the code are prohibited from making any contract for the sale of coal calling for delivery more than thirty days from the date of the contract, and code members are further prohibited, while the act is in effect, from making any contract for the sale of coal calling for delivery after the expiration of the act at a price below the minimum or above the maximum therefor approved or established by the Commission, and in effect at the time of such making.

Section 4 (15 USCA § 807 (i) further provides that the code prohibits its members from engaging in certain practices enumerated in said section as unfair methods of competition, many of which are for the purpose of compelling the producer to sell his coal to all persons similarly circumstanced at the same price.

All producers accepting and operating under the code are prohibited from interfering with or denying the right of their employees to organize and bargain collectively through representatives of their own choosing and from requiring any employee, as a condition of employment, to join a company union and from prohibiting employees from selecting their own check weighmen to inspect the weighing and measuring of coal, and from requiring as a condition of employment that their employees shall live in company houses or trade at the store of their employer.

Section 4 (15 USCA § 808 (g) also provides that the code formulated under its terms shall provide that whenever maximum daily or weekly hours of labor are agreed upon in any contract or contracts negotiated between the producers of more than two-thirds of the annual national tonnage production of bituminous coal for the preceding calendar year, and the representatives of more than one-half of the mine workers employed, such maximum hours of labor shall be accepted by and binding upon all code members, and that any wage agreement or agreements negotiated by collective bargaining in any district, or group of two or more districts, between representatives of producers of more than two-thirds of the annual tonnage production of such district or each of such districts in a contracting group during the preceding calendar year, and representatives of the majority of the mine workers therein, shall be filed with the labor board provided for in section 4 of the act (15 USCA § 808 (c) and shall be accepted as the minimum wages for the various classifications of labor by the code members operating in such district or group of districts.

Section 5 (d) (15 USCA § 809 (d) further provides that any code member injured in his business or property by any other code member, by reason of any breach thereof or the failure to do anything which is required by the act or the code formulated thereunder, may sue for damages on account thereof in any District Court of the United States in the district in which the defendant resides or is found, or has an agent, without respect to the amount in controversy, and shall recover threefold damages and the costs of the suit, including a reasonable attorney's fee.

The plaintiffs state that the Congress under the Constitution of the United States has no jurisdiction over and no power to legislate upon the matters required by section 4 of the act, and charge particularly that the fixing of minimum and maximum prices of coal free on board transportation facilities at the mines; the requirement that coal shall be sold by producers to all customers similarly circumstanced at the same price; the regulation and control of contracts for the sale of coal; and the regulations of the relations between producers and their employees in the production of coal, including the regulation and fixing of wages and hours of service as authorized in part 3 of section 4 (15 US CA § 808), are all matters not within the competency of Congress under the Constitution of the United States, and their attempted regulation by Congress is violative of the due process clause of the Fifth Amendment to the Constitution, and of the reserved rights of the states and the people, secured to them by the Tenth Amendment. Plaintiffs also state that section 4 is unconstitutional because it attempts to delegate legislative power, and that notwithstanding the lack of power of Congress to legislate on the subjects required by section 4 to be embraced in the code to be formulated thereunder, it undertook...