Tupman Thurlow Company v. Moss

• Decision Date: 01 March 1966
• Docket Number: Civ. No. 4164.
• Citation: 252 F. Supp. 641
• Parties: The TUPMAN THURLOW COMPANY, Inc., et al., v. W. F. MOSS, Commissioner, etc., et al.
• Court: U.S. District Court — Middle District of Tennessee

252 F. Supp. 641

The TUPMAN THURLOW COMPANY, Inc., et al., v. W. F. MOSS, Commissioner, etc., et al.

Civ. No. 4164.

United States District Court M. D. Tennessee, Nashville Division.

March 1, 1966.

Thomas Wardlaw Steele, Gullett, Steele & Sanford, Nashville, Tenn., J. Bradley Colburn and James H. Lundquist, Barnes, Richardson & Colburn, New York City, for plaintiffs.

George F. McCanless, Atty. Gen., State of Tennessee, Thomas E. Fox, Asst. Atty. Gen., Nashville, Tenn., for defendants.

Edwin F. Hunt, Boult, Hunt, Cummings & Conners, Nashville, Tenn., for defendant intervenor, Tennessee Farm Bureau Federation, Inc.

James M. Glasgow, Glasgow & Elam, Union City, Tenn., for defendant intervenor, Tennessee Livestock Assn., Inc.

John W. Douglas, Harland F. Leathers and Arthur E. Schwimmer, Asst. Attys. Gen., Dept. of Justice, Washington, D. C., and James F. Neal, U. S. Atty., Nashville, Tenn., for the United States as amicus curiae in support of the plaintiff.

Before PHILLIPS, Circuit Judge, and MILLER and GRAY, District Judges.

PER CURIAM.

This action was instituted by the Tupman Thurlow Company, Inc., and the William Davies Company, Inc.,¹ for a declaratory judgment that Chapter 34 of the 1965 Public Acts of Tennessee (See Appendix A), herein referred to as the Labeling Act, and Chapter 367 of the 1965 Public Acts of Tennessee (See Appendix B), herein referred to as the Licensing Act, are violative of the Federal Constitution and therefore void. Injunctive relief also being sought to restrain state officials² from enforcing the statutes, a three-judge court was constituted pursuant to 28 U.S.C.A. §§ 2281 and 2284.

Specifically, the complaint alleges that the Acts violate (1) the Commerce Clause of the Constitution of the United States, Art. I, Sec. 8, in that they constitute an unreasonable burden and restriction upon foreign and interstate commerce, and an effort by the State of Tennessee to levy and collect duties upon foreign goods imported into the State of Tennessee; (2) the Fourteenth Amendment, in that they deprive the plaintiffs of their property without due process of law and deny to them the equal protection of the law; and (3) the Supremacy Clause of the Constitution, Art. 6, in that the Acts are in conflict with acts of Congress which have preempted the field by imposing various regulations and restrictions upon the importation of foreign meat. Since plaintiffs for procedural reasons have abandoned reliance upon the Supremacy Clause of the Federal Constitution, in the light of Swift & Company, Inc. v. Wickham, 382 U.S. 111, 86 S.Ct. 258, 15 L.Ed. 2d 194 (Nov. 22, 1965), and an appropriate order has been entered to that effect, and since we conclude that the Acts must be declared void under the Commerce Clause, we consider in this opinion that provision of the Federal Constitution only, without reference to the Supremacy Clause or the Fourteenth Amendment.³

Both Acts challenged in this proceeding were enacted by the 84th General Assembly of Tennessee, the Labeling Act having been passed on February 16, 1965, and the Licensing Act on March 16, 1965. The Labeling Act requires that any person selling or offering for sale in the State of Tennessee any meats or meat foods which are the products of any foreign country to the United States "shall so identify each product and its foreign origin." If any product is offered for sale in bulk or portions whereby labeling is not feasible, it is provided that "a conspicuous sign in lieu of the label shall be displayed near the stock or display of the product." If foreign meats are combined with domestically produced meat into one product, the product shall be so labeled. In the event preservatives of any kind are used in any packaged meat product, the preservative shall be identified, along with the quantity used, and clearly displayed on any such package. It is provided that all bids submitted on meat and meat products to any tax-supported institution within the state shall contain one of the following labels: "This meat is of foreign origin," or "this meat is domestic meat," or "this is a combination of foreign and domestic meats," the institution being authorized to reject any such bid.

Responsibility for the administration of the Act is vested in the State Commissioner of Agriculture, who is empowered to promulgate regulations to effectuate its provisions. It is provided, however, that "none of said regulations shall require a higher standard of purity and sanitation than is from time to time required by the regulations of the United States Department of Agriculture to govern meat inspection by its agricultural research service." Violations of the Act are made misdemeanors punishable by prescribed fines and jail sentences, which are increased in severity for second and successive offenses.

The Licensing Act requires the registration and the annual licensing of "each person, firm or corporation in the State of Tennessee engaged in the business of manufacturing, buying, selling, handling, processing, packing or distributing imported meat or imported meat products, either at retail or wholesale." Imported meat and imported meat products are defined as "meats whose source of origin was beyond the continental limits of the United States and are or will be sold to the ultimate consumer as fresh or raw meat." The Act provides for two classes of licensees: (1) Manufacturers, packers or processors who are required to pay an annual license fee of $1500; and (2) Wholesale dealers or distributors who are required to pay an annual license fee of $500.

Each place of business must be separately registered and licensed. The supervision of the registration and licensing required by the Act are vested in the Foods Division of the Department of Agriculture, whose Commissioner is empowered and directed, when it can be shown that there is a shortage of any native meats, to "authorize the use, sale or otherwise handling of imported meats and meat products by all those required to be licensed by this Act without the payment of the fees required herein." Such authorization shall not exceed ninety days from the time that it is shown that the shortage no longer exists. All registration and license fees are appropriated to the Department of Agriculture, "to be used separately in carrying out the provisions of this Act and none of the funds or fees collected under this Act can be paid to or used for or by any other governmental agency." Any violation of the Act is declared to be a misdemeanor with a fine of not less than $25.00 nor more than $50.00 for each offense, each day on which a violation occurs constituting a separate offense.

Before discussing the substantive issues as to the constitutionality of the Acts when measured in terms of the Commerce Clause, we consider first the contentions of the defendants that the plaintiff is without standing to challenge the validity of the Acts, and that this Court should abstain from passing upon the issues until a state court has first had the opportunity to construe the Acts and to adjudicate their validity.

The predicate for the defendants' argument that the plaintiff is without standing to challenge the Labeling and Licensing Acts is the fact that the Acts are not directly operative in their requirements against the plaintiff and neither restrain nor require any act on its part, since plaintiff itself handles no meat and has no place of business in Tennessee. It is insisted that plaintiff is in no position to assert the rights of others, such as plaintiff's Tennessee customers upon whom the Acts' exactions and burdens directly fall. This objection would be of substance and would require dismissal of the action if the plaintiff suffered no injury or damage from the enforcement of the Acts, or if any injury or damage suffered by the plaintiff, should be indirect or remote and not direct and immediate. But such is not the case alleged in the complaint, nor, as a brief résumé of the pertinent facts will demonstrate, is it the case established by the proof.

Plaintiff is a New York corporation with no office or place of business in Tennessee. For several years it has been engaged in foreign and interstate commerce as a dealer in imported meats. It purchases meat which is grown, slaughtered and packaged in foreign countries, imports such meat into the United States, and resells it within and among the several states of the United States, including Tennessee. Its business is exclusively in interstate or foreign commerce. Its practice is to solicit orders from customers in Tennessee and then to have the meat imported into the United States in sealed cartons, each of approximately sixty pounds in weight, under conditions of refrigeration which cause the meat to remain hard frozen, and to be delivered in that form to its customers in Tennessee. In addition, plaintiff sells its meat to out-of-state manufacturers and processors having a national distribution. Such imported meat is used by the manufacturers in the processing and manufacturing of canned meats, soups, baby food, frozen food dinners, bologna, hamburgers, frankfurters, and the like. Such products are sold through retail outlets and stores in Tennessee. Wholesale distributors in Tennessee also receive imported meat from the plaintiff which is resold to persons in the State of Tennessee and then manufactured or processed into meat products which are then sold to the public through various retail outlets in Tennessee.

The allegations of the complaint, amply sustained by the evidence, are to the effect that the passage of the Labeling and Licensing Acts by the General Assembly of Tennessee has caused plaintiff's Tennessee customers to refuse to purchase its imported meat, thus for all practical purposes destroying the Tennessee market for its direct sales. Tennessee customers, in refusing to continue their business relationships with plaintiff, have stated as the basis for...