Walling v. Harnischfeger Corporation, Civ. A. No. 1087.

• Decision Date: 21 June 1956
• Docket Number: Civ. A. No. 1087.
• Citation: 142 F. Supp. 202
• Parties: L. Metcalfe WALLING, Administrator of the Wage and Hour Division, United States Department of Labor, Plaintiff, v. HARNISCHFEGER CORPORATION, a corporation, Defendant.
• Court: U.S. District Court — Eastern District of Wisconsin

142 F. Supp. 202

L. Metcalfe WALLING, Administrator of the Wage and Hour Division, United States Department of Labor, Plaintiff, v. HARNISCHFEGER CORPORATION, a corporation, Defendant.

Civ. A. No. 1087.

United States District Court E. D. Wisconsin.

June 21, 1956.

Stuart Rothman, Sol., Washington, D. C., Herman Grant, Regional Atty., U. S. Dept. of Labor, Chicago, Ill., James B. Leist, Atty., U. S. Dept. of Labor, Washington, D. C., for James P. Mitchell, Secretary of Labor.

T. W. Korb, Gen. Counsel, Peoria, Ill., for Harnischfeger Corp.

GRUBB, District Judge.

This is a motion by the defendant to vacate and dissolve an injunction entered February 5, 1944.

This judgment and decree was entered by the Honorable F. Ryan Duffy for the reasons set forth in his decision reported in 54 F.Supp. 326. In this decree it was

"Ordered, adjudged and decreed that the defendant, Harnischfeger Corporation, a corporation, its agents, servants, employees, attorneys, and all persons acting or claiming to act in its behalf and interest, be and they hereby are, permanently enjoined and restrained from violating the provisions of * * * (Fair Labor Standards Act 29 U.S. C.A. § 201 et seq.." (Emphasis supplied.)

The Circuit Court of Appeals reversed the judgment, 7 Cir., 145 F.2d 589, with direction to dismiss the complaint. Judge Minton dissented, page 593. On certiorari proceedings the United States Supreme Court reversed the Circuit Court of Appeals and affirmed the judgment of Judge Duffy, 325 U.S. 427, 65 S.Ct. 1246, 89 L.Ed. 1711. In neither of the appellate courts, so far as the decisions indicate, was a successful attack made upon the fact that the decree permanently enjoined the defendant.

The motion presently before the court is based upon two grounds:

(1) That the "defendant has fully complied with the terms thereof (the judgment) and with all of the provisions of the Fair Labor Standards Act, as amended." and

(2) That "It is no longer equitable that the said Judgment Order have prospective application."

This calls attention to Rule 60(b) (5) and (6) of the Federal Rules of Civil Procedure, 28 U.S.C.A., which provide that on motion and upon such terms as are just, the court may relieve a party from a final judgment for the following reasons: (5) that it is no longer equitable that the judgment should have prospective application; or (6) any other reason justifying relief from the operation of the judgment.

Defendant submits an affidavit by one of its vice presidents setting forth that at the time of the entry of the decree defendant had only three plants, all located in Milwaukee; that at the present time defendant, either through divisions or subsidiaries, operates nine plants at widely separated locations, and has a total of 3,140 hourly-paid employees; that the products of the defendant have undergone a substantial change by the addition of new lines; that the total sales now are at the rate of $75,000,000 to $80,000,000 a year as compared to $34,000,000 in 1943; that the management has undergone substantial change—of the eleven officers of the present company, only three held office in 1944; that between 1944 and 1956 the proportion of defendant's stock owned by the public has increased by more than 50%; that the method of rating or pricing jobs has been superseded by an entirely different system at a cost of $750,000 to the defendant, which change is 80% completed; that the new system eliminates overtime complications; that defendant has revised its methods for recording each employee's hours of work, now using time clerks who punch cards which record both job time and work time; that overtime is carefully watched and controlled; that the plant managers are instructed not to inaugurate any new pay plan without first checking it with Mr. Korb, its General Counsel, to make sure that it complies with the requirements of the Act; that defendant has complied fully with the terms of the decree and has paid out to former employees or on their behalf $973,487.06.

Plaintiff submits a counter-affidavit listing officers of the defendant in 1944 which shows that the defendant still has the same president, one of the vice presidents is the same, its then assistant secretary and general counsel is now secretary and treasurer, that three of the 1944 directors are still directors, that Walter Kasten was a director in 1944 and G. F. Kasten in 1954; that in 1954 the Harnischfeger family owned and controlled all of the outstanding preferred stock; that in October 1955 there were 1,780 shareholders; that the Harnischfeger Investment Company owned 59.44% of the common stock; and that Harnischfeger Investment Company was controlled by Walter Harnischfeger, president of the defendant corporation.

This court is not empowered to review, pass upon or consider the testimony and record that preceded Judge Duffy's findings and decree. That review has been had in the Circuit Court of Appeals and in the United States Supreme Court. This court is not empowered to inquire into the reasons that motivated Judge Duffy to make the decree permanent. The court is sure no one would question the fact that Judge Duffy well understood the meaning of the word "permanent" at the time he entered the judgment in question.

Many decisions have been cited by counsel but basically the determination of this motion must come within the holding of the United States Supreme Court in United States v. Swift & Co., 286 U.S. 106, 52 S.Ct. 460, 76 L.Ed. 999. In that case the lower court had modified an earlier decree of the same court which enjoined certain things. It was the position of the defendant, which is supported by considerable evidence, that many changes had taken place since the prior decree. Because of those changes the lower court modified the former decree. The United States Supreme Court stated at page 119 of 286 U.S., at page 464 of 52 S.Ct.:

"We are not framing a decree. We are asking ourselves whether anything has happened that will justify us now in changing a decree. The injunction, whether right or wrong, is not subject to impeachment in its application to the conditions that existed at its making. We are not at liberty to reverse under the guise of readjusting. Life is never static, and the passing of a decade has brought changes to the grocery business as it has to every other. The inquiry for us is whether the changes are so important that dangers, once substantial, have become attenuated to a shadow. No doubt the defendants will be better off if the injunction is relaxed, but they are not suffering hardship so extreme and unexpected as to justify us in saying that they are the victims of oppression. Nothing less than a clear showing of grievous wrong evoked by new

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