Texas & P. Ry. Co. v. Kuteman

• Decision Date: 01 January 1892
• Docket Number: 86.
• Citation: 54 F. 547
• Parties: TEXAS & P. RY. CO. v. KUTEMAN.
• Court: U.S. Court of Appeals — Fifth Circuit

54 F. 547

TEXAS & P. RY. CO. v. KUTEMAN.

No. 86.

United States Court of Appeals, Fifth Circuit.

November Term, 1892

W. W Howe, S. S. Prentiss, R. S. Lovett, and T. J. Freeman, for appellant.

H Chilton, for appellee.

Before PARDEE and McCORMICK, Circuit Judges, and LOCKE, District judge.

McCORMICK Circuit Judge.

The Texas & Pacific Railway Company, the appellant, exhibited its bill to one of the judges of the circuit court for the eastern district of Texas against the appellee, R. B Kuteman, showing that appellant was operating a line or lines of railroad in Texas and Louisiana, penetrating the pine-growing and lumber-producing regions in those states and extending beyond these into the western part of Texas, where no lumber is produced, but much is needed and used. That no lumber mills are operated on appellant's lines west of Mineola, and that appellant had adopted and was charging on all lumber shipments made or received on its line from all points east of Mineola on its railroad to the Texas state line, to be carried west of Mineola, what is known as a 'group rate.' That the group rate to Dallas, Tex., to which appellee's shipments were chiefly made, is 20 cents a hundred pounds in car-load lots. That said rate is reasonable and just, and a group rate is necessary to develop the lumber production in the pine region, and to fairly furnish the western market, and to increase the traffic on appellant's road. That no greater charge is made for hauling a shorter distance from a longer, and that making the same charge for the shorter as for the longer distance in the case stated prevents an unjust and oppressive discrimination against the producers of lumber in eastern Texas and the consumers of and dealers in lumber in the western and other parts of the state, where lumber is not produced. That the appellee has mills at and near Lake Fork, the most western point east of Mineola where lumber is received by appellant, and he claims that he should be given a lower rate than the rate charged on shipments made at points further east, in proportion to the respective length of the haul, substantially claiming that any rate but a mileage rate unjustly discriminates against him. Claiming further that 12 1/2 cents a hundred pounds for lumber in car loads is the highest rate that is reasonable on shipments from his mills to Dallas, and that the difference between this and 20 cents, charged by appellant, is the measure of the unjust discrimination made against him by appellant. That appellee has already brought five suits against the appellant on account of shipments made, and threatens to bring and to induce others to bring many more. That appellee's practice heretofore has been, and his threatened plan is, to sue on each separate car-load shipment, or on only such a number as that the amount claimed by him in each suit will be below the amount necessary to permit the appellant to appeal to a court of last resort, or to one in which a judge or judges learned in the law sit; and that the local judges of the inferior courts in which appellee's suits have been brought and are threatened to be brought, and of the only court to which they can be appealed, are not required by law to be learned in the law, and in fact are not so learned. That they have so far disregarded appellant's defenses, and have given judgment against appellant, which appellant either has paid or will have to pay, and that appellee boasts--by no means extravagantly-- that these ignorant or prejudiced judges will continue to give judgment against appellant in the numerous cases threatened; thus practically enforcing a rebate in favor of the appellee on all of his shipments, without appellant having any remedy or power to prevent it by any proceeding at law. That since July 1, 1889, appellee has shipped 105 car loads of lumber from Lake Fork to Dallas or other points west of Mineola. That he is a continuous, constant shipper, and that he claims a reduction of the rate charges on each car, averaging between $15 and $35, for which he avows his purpose to sue, which, if enforced, will injure appellant more than $5,000 per annum. And that appellant's right to fix such rate is of the value of more than $10,000. Prayer is made for injunction and for general relief.

On May 3, 1890, the judge ordered:

'On consideration of the foregoing bill it is ordered that the same be filed and served by copy upon R. B. Kuteman, with usual subpoena. It is further ordered that the said defendant, R. B. Kuteman, do show cause, on Monday, the 12th day of May, at 11 o'clock A.M., or as soon thereafter as counsel can be heard, before the circuit court for this district, at Tyler, why the injunction pendente lite prayed for in said bill should not issue; and in the mean time let a restraining order issue enjoining and prohibiting the said defendant from instituting or prosecuting the action described in said bill until further order of the court.'

It does not appear when notice of this order or process of subpoena was served on the defendant. On September 10, 1890, there was filed what is labeled, 'Answer to Order to Show Cause. ' On September 17th was filed the defendant's demurrer to complainant's bill, stating the grounds:

'(1) That the same is wholly insufficient, and the facts stated therein show no cause of action; (2) that the circuit court of the United States has no jurisdiction to issue a writ of injunction against proceedings in the state courts; (3) that the amount involved is not sufficient to give the circuit court of the United States jurisdiction of complainant's bill; (4) that the penalties or suits which complainant alleges to be threatened by respondent are quasi criminal and statutory, and the United States court has no jurisdiction to enforce or restrain them.'

No further action of the circuit court or of any of its judges appears in the case until September 12, 1892, on which day the decree appealed from was passed in these terms:

'This cause came on to be heard at this term, and was argued by counsel for the plaintiff and the defendant, and thereupon, upon consideration thereof, it was ordered, adjudged, and decreed as follows: That the demurrers filed by defendant herein on September 17, 1890, and put in to the whole of the plaintiff's bill, be held good and sufficient, and that the injunction or restraining order heretofore granted do stand dissolved, and that said demurrers be sustained, and the bill dismissed. It is further ordered, adjudged, and decreed that said plaintiff, the Texas & Pacific Railway Company, take nothing by this suit, and that said defendant, R. B. Kuteman, go hence without day, and recover of plaintiff all costs in this behalf expended, which costs may be taxed by the clerk, and for which execution may issue.'

The appeal was duly allowed and perfected, and the appellant contends that the circuit court erred in sustaining the demurrers of defendant, and dissolving the injunction theretofore granted, and dismissing complainant's bill. The appellee contends that the demurrers were properly sustained and the bill dismissed, and submits these propositions:

'(1) The federal courts are not authorized to restrain proceedings in state courts, except to sustain a first-acquired federal jurisdiction; and the preliminary injunction herein was properly dissolved, and demurrer sustained. (2) The demurrer was properly sustained, because the amount in controversy was less than the sum necessary to give federal court jurisdiction. (3) Plaintiff's bill lacked equity, in that a legal remedy existed in its behalf by consolidation of the suits in justice's court. (4) That under the statute of Texas regulating railroad rates the railway company was liable to Kuteman for unjust discrimination, and complainant's bill showed no cause of action against him. (5) That the preliminary injunction was properly dissolved, because of the answer of defendant denying the allegations that he intended to bring suit for discrimination on 105 cars of lumber, and charging that there were not more than five of such cars. (6) That the injunction was properly dissolved, because the matters of controversy set up in complainant's bill were shown by the defendant's answer to have been already adjudicated adversely to complainant in the state court.'

It is not clear that the bill in this case seeks to stay or enjoin any pending proceedings in state courts, though the language of the prayer that the defendant be enjoined 'from instituting or prosecuting such action pending this cause' is susceptible of that construction. Manifestly the chief purpose was to prevent the further institution of the many threatened suits, and, if the plaintiff sought relief as to suits already brought, as well as to suits threatened, the two purposes and prayers are not so united or dependent that they must stand or fall together. The language of the statute is plain, and the decisions uniform, that, with the exception named in the statute, a writ of injunction shall not be granted to stay pending proceedings in any court of a state. Rev. St. U.S. Sec. 720; Diggs v. Wolcott, 4 Cranch, 179; Peck v. Jenness, 7 How. 620; Haines v. Carpenter, 91...