United States v. Pepper Bros.

• Decision Date: 03 May 1944
• Docket Number: No. 8602.,8602.
• Citation: 142 F.2d 340
• Parties: UNITED STATES v. PEPPER BROS.
• Court: U.S. Court of Appeals — Third Circuit

142 F.2d 340 (1944)

UNITED STATES v. PEPPER BROS.

No. 8602.

Circuit Court of Appeals, Third Circuit.

Argued April 18, 1944.

Decided May 3, 1944.

Stewart Lynch, of Wilmington, Del. (Tom C. Clark, Asst. Atty. Gen., Walker Smith, Sp. Asst. to the Atty. Gen., and Thomas I. Emerson, Deputy Administrator for Enforcement, and Samuel Mermin and Harry L. Shniderman, Attys., Office of Price Administration, all of Washington, D. C., on the brief), for appellant.

Alfred C. McKenzie, Brooklyn, N. Y. (Milton E. Sahn, of New York City, on the brief), for appellee.

Before MARIS, GOODRICH, and McLAUGHLIN, Circuit Judges.

MARIS, Circuit Judge.

This is an appeal by the United States from an order of the District Court for the District of Delaware granting the defendant's motion to quash the fifth and sixth counts of a criminal information which charged the defendant with violation of Revised Maximum Price Regulation 269 issued under Section 2 of the Emergency Price Control Act of 1942, 50 U.S.C.A. Appendix, § 902.

Revised Maximum Price Regulation 269 (7 F.R. 10708) fixed maximum prices for poultry and prohibited any person from selling or delivering and any person in the course of trade from buying or receiving poultry at prices higher than the maximum prices thus fixed. By Amendment No. 6 effective March 20, 1943, (8 F.R. 3316), the Regulation was modified by the adoption for pricing purposes for both dressed and live poultry of tentative standards for classes and grades promulgated by the Department of Agriculture. As amended the Regulation prescribed maximum prices for the different classes and weights of Grade A live poultry and established a basis for determining maximum prices for Grade B and Grade C. Section 4(a) of the Act, 50 U.S.C.A. Appendix, § 904(a), makes it unlawful for any person to sell or deliver or in the course of trade or business to buy or receive any commodity in violation of any regulation under Section 2, and Section 205(b) makes the willful violation of Section 4(a), 50 U.S.C.A. Appendix, §§ 902, 925(b) and 904(a), a misdemeanor punishable by fine or imprisonment or both.

The fifth and sixth counts of the information in the present case charged the defendant with purchasing on or about July 28, 1943 from one John Isaac a total of 15,641 pounds of live broilers, fryers and light roasters, 80% thereof being of Grade B and 20% thereof being of Grade C, at prices in excess of the maximum prices permitted by Revised Maximum Price Regulation 269 to be paid for poultry items of those classes and grades.

The district court quashed these counts of the information upon the ground that subsection (j) of Section 2 of the Act, as added by Section 5(a) of the Joint Resolution of July 16, 1943, 57 Stat. 566, repealed the provisions of Maximum Price Regulation 269 for standards and grades of poultry and maximum prices based thereon. 53 F.Supp. 163. Preliminarily we note that if this construction of the Act had been the sole ground for the court's action the present appeal would, under the Criminal Appeals Act, 18 U.S.C.A. § 682, have had to have been taken directly to the Supreme Court. However, in a supplemental opinion denying the Government's motion for reargument the court stated that its action was also based upon the independent ground that the counts were defective for failure to set out sufficient averments. 53 F.Supp. 166. In view of the existence of these grounds for the court's action apart from its construction of the statute the appeal was properly taken to this court. United States v. Wayne Pump Co., 1942, 317 U.S. 200, 63 S.Ct. 191, 87 L.Ed. 184. Under the circumstances we have authority to review the district court's construction of the statute as well as its ruling as to the insufficiency of the information. United States v. Swift & Co., 1943, 318 U.S. 442, 63 S.Ct. 684, 87 L.Ed. 889.

We accordingly turn to the consideration of the questions raised by the appeal. The principal question is whether the provisions of the Regulation for maximum prices by grades which the defendant is charged with having violated had been repealed by Congressional action subsequent to their adoption and were, therefore, not in force at the time of the purchases in question. The defendant relies upon subsection (j), known as the Taft amendment, which was added to Section 2 of the Emergency Price Control Act by the Joint Resolution of July 16, 1943, 57 Stat. 566, and which provides:

"(j) Nothing in this Act shall be construed (1) as authorizing the elimination or any restriction of the use of trade and brand names; (2) as authorizing the Administrator to require the grade labeling of any commodity; (3) as authorizing the Administrator to standardize any commodity, unless the Administrator shall determine, with respect to such standardization, that no practicable alternative exists for securing effective price control with respect to such commodity; or (4) as authorizing any order of the Administrator fixing maximum prices for different kinds, classes, or types of a commodity which are described in terms of specifications or standards, unless such specifications or standards were, prior to such order, in general use in the trade or industry affected, or have previously been promulgated and their use lawfully required by another Government agency."

The defendant's contention is that the enactment of subsection (j) repealed and rendered void those provisions of the Regulation which imposed standardization and maximum prices of poultry by grades and that consequently there was no ban upon the defendant's purchase on July 28, 1943 of poultry at prices higher than those maximum prices. The Government denies that subsection (j) operated as such a repealer and asserts that the question whether it rendered void the provisions in controversy involves the continued validity of the Regulation, a question which the district court had no power to consider, since jurisdiction to determine the validity of price regulations is conferred exclusively upon the Emergency Court of Appeals and the Supreme Court, and is expressly withdrawn from all other courts, federal, state or territorial, by Section 204(d) of the Emergency Price Control Act, 50 U.S.C.A. Appendix, § 924(d).

In granting the motion to quash the two counts the district court in its original opinion held that the provisions of the Regulation upon which the counts were based had been repealed by subsection (j). The court stated that in so holding it did not consider that it was passing upon the validity of the Regulation. If the effect of the enactment of subsection (j) was to repeal outright all standardization and grade pricing provisions contained in regulations in force at the date of its enactment the action of the district court was right and must be sustained. For to hold that a piece of legislation, whether a statute or a regulation, has been repealed by a subsequent Act of Congress is not to pass upon its validity but merely upon its continued existence.

Did subsection (j) repeal these provisions of the Regulation? Certainly the subsection does not in express terms purport to repeal any provisions of existing regulations or orders of the Administrator which were valid...