Sunshine Mining Co. v. Carver

• Decision Date: 27 August 1941
• Docket Number: No. 1444.,1444.
• Citation: 41 F. Supp. 60
• Parties: SUNSHINE MINING CO. v. CARVER, U. S. Dist. Atty., et al.
• Court: U.S. District Court — District of Idaho

41 F. Supp. 60

SUNSHINE MINING CO. v. CARVER, U. S. Dist. Atty., et al.

No. 1444.

District Court, D. Idaho, N. D.

August 27, 1941.

Joseph C. Cheney, of Yakima, Wash., and H. J. Hull, of Wallace, Idaho, for plaintiff.

E. H. Casterlin and Paul S. Boyd, both of Boise, Idaho, for defendant John A. Carver.

R. Max Etter, of Spokane, Wash., for defendants C I O et al.

Dorothy M. Williams and Irving Schoenfeld, both of San Francisco, Cal., for Wage and Hour Division, Department of Labor.

CAVANAH, District Judge.

This suit involves the application and interpretation of the Fair Labor Standards Act, 29 U.S.C.A. ß 201 et seq., as to the operations of the plaintiff, a mining corporation organized under the laws of the State of Washington, and engaged in extracting ore from its mining property in the State of Idaho, and is for judgment under the Federal Declaratory Judgment Act, 28 U.S.C.A. ß 400.

The request for relief is: (a) That it and its employees are not engaged in commerce, or in the production of goods for commerce, to bring its operations under the provisions of the Fair Labor Standards Act, or, if the Act is declared to be applicable to it and its employees, it is unconstitutional. (b) That the time spent in traveling to and from the employees' usual "working place" and the lunch period are not to be considered "hours worked" for which compensation is due to the employees. And (c) that the requirement of sections six and seven as to overtime are satisfied by the employer "whenever the total compensation paid to his employees exceeds a sum equal to forty times the statutory minimum of thirty cents per hour, plus one and one-half times his regular wage for all hours worked in excess of forty hours in any one week".

Jurisdiction is founded on the diversity of citizenship and the eixstence of a federal question arising under the Constitution and laws of the United States, and the amount in controversy.

On the motions to dismiss, the conclusion was reached that the Fair Labor Standards Act was constitutional; that the plaintiff was subject to it, as it appeared that plaintiff and its employees were engaged in the production of goods for interstate commerce, and that the defendants were properly joined upon the facts alleged, leaving to be determined whether the facts so alleged are established by the evidence. Sunshine Mining Company v. Carver et al., D.C., 34 F.Supp. 274.

A fair analysis of the evidence discloses that the nature of plaintiff's business is that it is operating a mine in Shoshone County, Idaho, and its sole and only business and activity is extracting ore containing gold, silver, copper, lead, antimony, bismuth, zinc, arsenic and iron, which it sells to the Bunker Hill and Sullivan Mining and Concentrating Company, in conformity with a contract, and to be delivered in railroad cars at Shont. Shoshone County, Idaho, which is situated about two and a half miles north of its mine. The concentrated ore is then taken by the concentrating company to its smelter at Bradley, Shoshone County, Idaho, and there sampled and weighed to determine the amount of metal it is purchasing, and then dumped into bins with other concentrates purchased from others. It can be estimated from assays, the amount of metal received from the ore concentrates obtained from any particular company. The silver received from the concentrates purchased from plaintiff is shipped to the Government mint at San Francisco, California, and the antimony, copper, matt and speiss product which contains practically all of the copper in the ore concentrates so received from plaintiff are shipped and sold to the American Smelting and Refining Company at Tacoma, Washington.

Silver is the principal metal produced by the plaintiff and it sells, monthly, about 700,000 ounces of silver to the Bunker Hill and Sullivan Mining and Concentrating Company, and it and the Bunker Hill and Sullivan Mining and Concentrating Company knew at the time the concentrates were so purchased from the plaintiff that the metal contained therein, and nearly all of the Bunker Hill and Sullivan output are shipped outside of the state of Idaho. Thus it appears clearly from the manner of the operation of plaintiff that the plaintiff is engaged in producing goods which are, after being refined and processed by the smelter, moved in interstate commerce, and comes within the terms of the Act, which reaches both those who are engaged in interstate commerce and those engaged in production of goods for interstate commerce. National Labor Relations Board v. Fainblatt et al., 306 U.S. 601, 59 S. Ct. 668, 83 L.Ed. 1014; United States v. Darby, 312 U.S. 100, 61 S.Ct. 451, 85 L.Ed. ___, 132 A.L.R. 1430; Allen v. Moe, D.C., 39 F.Supp. 5; Divine v. Levy et al., D.C., 39 F.Supp. 44; St. John v. Brown, D.C., 38 F.Supp. 385; Opp Cotton Mills, Inc., v. Administrator of Wage and Hour Division, 5 Cir., 111 F.2d 23.

The fact that intrastate and interstate transactions are comingled does not restrict Congress to control and define such transaction and acts. Currin et al. v. Wallace, 306 U.S. 1, 59 S.Ct. 379, 83 L.Ed. 441.

Approaching then the question, after it was thought that the plaintiff was subject to the Fair Labor Standards Act: Is there an actual controversy as disclosed by the evidence within the meaning of the Federal Declaratory Judgment Act?

There must, of course, exist a real and substantial controversy between the parties having adverse legal interest appropriate for judicial determination as defined by the Supreme Court in the case of ?tna Life Insurance Co. v. Haworth et al., 300 U.S. 227, 57 S.Ct. 461, 81 L.Ed. 617, 108 A.L.R. 1000.

What, then, is the nature of the controversy, its relation and interest to the relief sought as shown by the evidence?

It will be remembered that the Fair Labor Standards Act provides for penalties to be imposed upon employers for a violation of it, and that there is a demand in the present case for the traveling time and lunch period involved in plaintiff's operation to be computed as time worked within the meaning of maximum hours provisions of the Act and the restraining of the defendants from instituting any action against plaintiff and it is urged that plaintiff and its employees are not engaged in commerce or the production of goods for commerce as defined by the Fair Labor Standards Act, and if it and its employees are so engaged within the meaning of that law, the application of the Act to it and its employees is beyond the power of congress to "regulate commerce among the several States", and deprives plaintiff of its property without due process of law, and therefore is unconstitutional and invalid, and whether there is an actual controversy.

The answer to the inquiry as to whether the Act is constitutional and that the employees of plaintiff are not engaged in commerce or the production of goods for commerce must be in the affirmative, and the record presents a real and substantial controversy between the parties. There appears a reasonable dispute between the parties as to what is the application and interpretation of the Act. The purpose of the Declaratory Judgment Act is to settle and afford relief for uncertainties with respect to rights. The plaintiff need only show that its position is jeopardized by the statute, and threats to enforce the statute are not necessary. United States Fidelity & Guaranty Company v. Koch et al., 3 Cir., 102 F.2d 288, 290.

The conduct of plaintiff's business as it claims, is outside the jurisdiction of the criminal statute but subjects it to its terms. Under such circumstances it does not have to wait indefinitely under suspension. Currin et al. v. Wallace, supra; ?tna Life Insurance Co. v. Haworth et al., supra; Wallace v. Currin et al., 4 Cir., 95 F.2d 856; Employers' Liability Assur. Corporation v. Ryan et al., 6 Cir., 109 F.2d 690; Angell et al. v. Schram, 6 Cir., 109 F.2d 380; Lehigh Coal & Navigation Co. v. Central R. R. of New Jersey, D.C., 33 F.Supp. 362; Black et al. v. Little et al., D.C., 8 F.Supp. 867.

As to whether there is a justifiable controversy between the plaintiff and defendant Carver, it will be discussed under the contention: Have the defendants been properly joined and whether the Administrator of the Wage and Hour Division is an indispensable party. This question was disposed of on the motions to dismiss, where the Court considered the statute and the facts alleged, and it is pertinent to repeat what was there said 34 F.Supp. 279:

"It being urged by the defendants that the District Attorney for the District of Idaho has no authority under the statute to carry out a threat of prosecution. Subdivision (b) of Section 4 of the Act provides: `* * * Attorneys appointed under this section may appear for and represent the Administrator in any litigation, but all such litigation shall be subject to the direction and control of the Attorney General. * * *' And Section 11 provides that the Administrator shall bring all action under Section 17 to restrain violation thereof, and it vests in the Attorney General the same power over the attorney appointed by the Administrator that he has over the District Attorneys. The Attorney General has general charge over all litigation when the United States or any of its agencies are involved. Title 5 U.S.C.A. ß 309.

"The Department of Labor Act created a Wage and Hour Division which is under the Administrator, an agency of the United States, and the duty of the District Attorney is to prosecute all delinquents for crimes and offenses cognizable under the authority of the United States, Title 28 U.S.C.A. ß 485. He has control and charge of all criminal proceedings within his District. He may proceed and prosecute under the Act without first receiving authority from the Attorney General or the Administrator. A grand jury would have the power to make an inquisitorial investigation and ascertain whether or not the Act had been violated...