Tilbury v. Rogers, Civ. No. 4004

• Decision Date: 04 August 1954
• Docket Number: 4052.,Civ. No. 4004,4040
• Citation: 123 F. Supp. 109
• Parties: TILBURY v. ROGERS, Regional Director, U. S. Department of Labor, et al. MITCHELL, Secretary of Labor, U. S. Department of Labor v. TILBURY (two cases).
• Court: U.S. District Court — Western District of Louisiana

123 F. Supp. 109

TILBURY v. ROGERS, Regional Director, U. S. Department of Labor, et al.

MITCHELL, Secretary of Labor, U. S. Department of Labor v. TILBURY (two cases).

Civ. Nos. 4004, 4040, 4052.

United States District Court, W. D. Louisiana, Shreveport Division.

August 4, 1954.

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Robert G. Chandler, Shreveport, La., for M. A. Tilbury.

Stuart Rothman, Washington, D. C., Earl Street, T. Hagan Allin, Dallas, Tex., for James P. Mitchell, Secretary of Labor.

Frederick J. Stewart, Shreveport, La., for William A. Self and Jimmie Simmons.

DAWKINS, Jr., Chief Judge.

Almost in point here is Newton's third law of physics which holds that for every action there is an equal and opposite reaction. Launched with some sureness against several adversaries, an action for a Declaratory Judgment has brought forth a multipronged counterattack:

Asking that we declare his business and the work of a number of his employees not subject to the Fair Labor Standards Act,¹ M. A. Tilbury, d/b/a Tilbury's Southern Meat Compoany, in C.A. No. 4004 impleaded twelve of his employees, as well as the Local and Regional Directors of the Wage-Hour and Public Contracts Division of the Department of Labor. By consent these officials were dismissed from the suit as improper parties defendant.² Two of the employee-defendants counterclaimed³ for overtime pay, penalties and attorney's fees.

But Pandora's box still was not empty: In C.A. No. 4040, the Secretary of Labor sued Tilbury for a permanent injunction against further alleged violations of the Act; and in C.A. No. 4052, he claimed substantial overtime payments said to be due to four of the Tilbury employees who were impleaded in C.A. No. 4004. The remaining six employees have not appeared or made claims.

Inasmuch as the facts are equally applicable to all three actions, they were consolidated for trial and decision, with separate judgments, of course, to be rendered in each case. Since Tilbury is the named defendant in two of the three actions, and a defendant in counterclaims in the third, we shall refer to him, for convenience, as defendant.

He paid his employees straight weekly wages well above the minimum required by the Act. Admittedly, however, he did not compensate them for overtime, and until February 4th, 1953, did not keep proper records, believing that the Act was inapplicable to his operations. Since then he has complied with it fully in all respects, except it is contended he has not done so in connection with certain "incentive" payments, discussed infra.

The primary, the basic questions for resolution are whether 1) these employees were "engaged in commerce" or 2) in "production of goods for commerce," so as to come within the purview of the Act. 29 U.S.C.A. § 202. If either question is answered in the affirmative, the Act is applicable.

Defendant's business is wholesale distribution, entirely intrastate, of meat, meat products and by-products. His customers are restaurants, hotels and similar establishments, which order special cuts or types of meat that are prepared by his employees. Regularly each week he receives large shipments of these commodities from points outside Louisiana. A relatively small percentage of these (less than 4%) come directly to his place of business. Most come from packing plants in Shreveport. All such shipments, however, are delivered, unloaded and placed upon the floor of defendant's storage room by employees of the packers.

There is a dispute as to whether the shipments regularly are checked in and placed on shelves or hooks in the storage room by the butchers and boners for whom and by whom claims for overtime are here asserted, or whether this is done by the shop foreman or manager. We have concluded that it is the latter, not the former, whose duty it is and who regularly perform these tasks. Although two of the employee-claimants, McBride and Dyess, testified that they spend about two hours each week at such work (and it was stipulated that two others would testify likewise), we prefer to believe the testimony of Mr. Blalock, the shop foreman, to the effect that the butchers and boners are called upon to do this only on rare occasions, when both he and Mr. Johnson, the manager, are absent. He, unlike the claimants, has no direct interest in this litigation. His version is far more logical and likely businesswise than is theirs. We cannot say, therefore, that any substantial amount of work time was spent by the butchers and boners in checking or handling incoming shipments of meats. This must be shown before their work or wage payments become subject to the Act.⁴ It is the nature and extent of their duties in this respect, not the character of defendant's business, which is controlling.⁵ Furthermore, it is our opinion that the shipments had completed their interstate journey when they came to rest on defendant's storage room floor, having been placed there by the packers' employees. Accordingly, we hold that no proper basis has been established for application of the Act with regard to this type of work.

There are other facts, however, which bring the duties and wages of these employees under the Act: Regularly and necessarily in the course of their employment, while preparing meats and meat cuts for defendant's customers, his butchers and boners handle or otherwise work upon bones and other inedibles which are a part of the meats bought by defendant from the packers.⁶ Defendant regularly sells these, and they go directly or indirectly into interstate commerce in various forms such as animal food, etc. The parties have stipulated that defendant knew, or had reason to believe, these by-products would be shipped extra-state. Even without the stipulation, if defendant knew or had "reasonable grounds to anticipate" — and we think he did — that these inedibles would move into commerce, the Act would be applicable.⁷

This part of defendant's business, it is true, constitutes only .216 of 1% of his total dollar volume of sales, and 8.45% of the total tonnage of meat products sold. But that is not the governing factor, for the Supreme Court has held that the rule of "de minimis" has no application to cases of this kind.

"The Appellate Division applied the maxim de minimis to exclude respondent from the provisions of the Act. We think that was error. The Court indicated in National Labor Relations Board v. Fainblatt, 306 U.S. 601, 607, 59 S.Ct. 668, 672, 83 L.Ed. 1014, that the operation of the National Labor Relations Act (49 Stat. 449, 29 U.S.C. § 151, 29 U.S. C.A. § 151) was not dependent on `any particular volume of commerce affected more than that to which courts would apply the maxim de minimis.' That Act, unlike the present one (Walling v. Jacksonville Paper Co., 317 U.S. 564, 570, 571, 63 S.Ct. 332, 336, 87 L.Ed. 460), regulates labor disputes `affecting' commerce. 49 Stat. 450, 29 U.S.C. § 152, 29 U.S.C.A. § 152. We need not stop to consider what different scope, if any, the maxim de minimis might have in cases arising thereunder. Here, Congress had made no distinction on the basis of volume of business. By § 15(a) (1) 29 U.S. C.A. § 215(a) (1) it has made unlawful the shipment in commerce of `any goods in the production of which any employee was employed in violation of' the overtime and minimum wage requirements of the Act. Though we assume that sporadic or occasional shipments of insubstantial amounts of goods were not intended to be included in that prohibition, there is no warrant for assuming that regular shipments in commerce are to be included or excluded dependent on their size. * * *" Mabee v. White Plains Publishing Co., 327 U.S. 178, 66 S.Ct. 511, 512, 90 L.Ed. 607.

In that case the White Plains Publishing Company regularly sent extrastate only one-half of 1% of its newspapers. We thoroughly disagree with this holding and believe Justice Murphy's dissent is correct, but we are bound to follow the interpretation of Congressional intent reached in the majority opinion.

Since practically all of the working time of defendant's butchers and boners is indirectly involved in the production of bones and other inedibles — this being "production of goods for commerce"—while they simultaneously and directly are preparing meat cuts for defendant's customers, we have no alternative but to hold that the work of these employees "in commerce" is "substantial", and their wage payments are subject to the Act.

Having arrived at that conclusion, we now consider the remaining factual and legal issues which proceed from it:

There is a dispute as to the exact number of hours worked each week by these employees. The Secretary and employee-claimants insist this amounted to as much as 63 hours, whereas defendant argues that they worked an average of 56 hours per week. We believe the latter's version is eminently correct. Prior to February 4th, 1953, no time cards were kept, but from that point forward they were. The employees admitted they worked the same number of hours before and since that date. They also admitted that defendant paid them for every hour they worked. The cards were prepared and kept current each day by the bookkeeper after receiving reports from the shop foreman. At the end of each week, when receiving their pay, the employees were shown the cards and required to sign them. In their testimony they expressly admitted that they...