Younts v. Southwestern Telegraph & Telephone Co.

• Decision Date: 18 November 1911
• Docket Number: 5,577.
• Parties: YOUNTS v. SOUTHWESTERN TELEGRAPH & TELEPHONE CO.
• Court: U.S. District Court — Eastern District of Arkansas

192 F. 200

YOUNTS v. SOUTHWESTERN TELEGRAPH & TELEPHONE CO.

No. 5,577.

United States Circuit Court, E.D. Arkansas, Western Division.

November 18, 1911

This suit was instituted in a state court and by the defendant removed to this court upon the ground of diversity of citizenship. The complaint alleges: That the defendant is engaged in operating a telephone exchange in the city of Little Rock and in installing and furnishing telephones in the residences and places of business of the citizens of the city, as well as citizens living and residing in the country and also of citizens living in the neighborhood of Fourche Dam and in close proximity to the place of business and residence of plaintiff, an in furnishing the citizens thereof with telephone connections through the central office of the exchange maintained by said defendant so as to give to citizens who are subscribers for telephone instruments connected with said exchange facilities for communicating with all other parties who are subscribers to said telephone. That on the 10th day of May, 1910, plaintiff made application in writing to defendant for a telephone and equipment at his residence at Fourche Dam and to connect the same for his use with the defendant's Little Rock exchange on the terms and conditions required of other subscribers similarly situated. That such application has been time and again repeatedly made, but by the defendant refused. That plaintiff has complied and offered to comply with all reasonable regulations of the defendant, and as an inducement to obtain telephone facilities offered to pay for the necessary wire and poles and the expense of erecting the same.

It is then charged that this refusal was an unlawful discrimination, for the reasons stated in the complaint that the defendant has poles and a line of wires along the Fourche Dam pike to a point on said pike about onehalf mile from the residence of plaintiff; that from this point on the pike the defendant has run a line of wires and put up poles a distance of about one-half mile in a northeasterly direction and installed a telephone and telephone connection in the residence and place of business of Fred Hohenschutz, and also in the residence and place of business of Peter Barzen giving to both of these persons single line or private wire connection; that these installations and connections were made prior to plaintiff's application for a telephone and connection; that it is far easier and less expensive for the defendant to have furnished plaintiff with a telephone and telephone connection than it was to furnish them to the above-named parties; that it was no more trouble or expense for the defendant to run its line of wires and erect posts from the point on the pike at which the line swings over to the premises of the said Hohenschutz and Barzen than it is or was to run its line of poles and wires to the residence of the plaintiff; that this discrimination has continued for more than 385 days; and that by reason thereof he is entitled to recover $100 penalty under the laws of the state of Arkansas for each and every day for the 385 days. He therefore prays judgment for $38,500 penalties.

The defendant demurs to the complaint, setting up various grounds; but at the hearing it relied solely upon the ground that the facts alleged in the complaint are not sufficient to constitute a cause of action. The statute of the state of Arkansas upon which this action is based was enacted March 31, 1885, is digested in Kirby's Digest of the Revised Statutes of Arkansas of 1904 as section 7948, and is as follows:

'Every telephone company doing business in this state and engaged in a general telephone business shall supply all applicants for telephone connection and facilities without discrimination or partiality; provided, such applicants comply or offer to comply with the reasonable regulations of the company, and no such company shall impose any condition or restriction upon any such applicant that are not imposed impartially upon all persons or companies in like situations; nor shall such company discriminate against any individual or company engaged in lawful business, by requiring as condition for furnishing such facilities that they shall not be used in the business of the applicant, or otherwise, under penalty of one hundred dollars for each day such company continues such discrimination, and refuses such facilities after compliance or offer to comply with the reasonable regulations and time to furnish the same has elapsed, to be recovered by the applicant whose application is so neglected or refused.'

W. H. Pemberton, for plaintiff.

A. P. Wozencraft and Walter J. Terry, for defendant.

TRIEBER District Judge (after stating the facts as above).

In every action brought in a circuit court of the United States, or removed thereto from a state court, a preliminary question to be determined is whether the court has jurisdiction of the cause. If the record does not affirmatively show jurisdiction in this court, it is its duty to so declare and decline to proceed further, and this it must do although no objections are raised by either party, or even if the parties consent to the jurisdiction. Minnesota v. Northern Securities Co., 194 U.S. 48, 24 Sup.Ct. 598, 48 L.Ed. 870, and authorities there cited.

Under the Judiciary Act of August 13, 1888 (chapter 866, 125 Stat. 433 (U.S. Comp. St. 1901, p. 507)) no cause can be removed from a state to a national court unless it is one which could have been originally brought in that court. Tennessee v. Bank, 152 U.S. 454, 14 Sup.Ct. 654, 38 L.Ed. 511; Cochran v. Montgomery County, 199 U.S. 260, 26 Sup.Ct. 58, 50 L.Ed. 182; Ex parte Wisner, 203 U.S. 449, 27 Sup.Ct. 150, 51 L.Ed. 264.

It is urged that, as this is a suit to recover penalties imposed by the laws of the state of Arkansas, this court is without jurisdiction. Wisconsin v. Pelican Insurance Company, 127 U.S. 265, 8 Sup.Ct. 1370, 32 L.Ed. 239, is cited as conclusive of that question. It was there held that:

'The rule that the courts of no country execute the penal laws of another applies not only to prosecutions and sentences for crimes and misdemeanors, but to all suits in favor of the state for the recovery of pecuniary penalties for any violation of statutes for the protection of its revenue, or other municipal laws, and to all judgments for such penalties.' 127 U.S. 290, 8 Sup.Ct. 1374, 32 L.Ed. 239.

In that case the suit was brought by the state itself to recover a penalty for the benefit of the state, and, as stated by the court in its opinion, the act complained of was not any private injury, but solely an offense committed against the state by violating her law. The prosecution in that case was in the name of the state, and the whole penalty, when recovered, would accrue to the state and be paid into her treasury, although the insurance commissioner would receive one-half of the amount recovered; he paying all expenses of the prosecution for and collecting such forfeitures. The court in the opinion said:

'The real nature of the case is not affected by the forms provided by the law of the state for the punishment of the offense. It is immaterial whether, by the laws of Wisconsin, the prosecution must be by indictment or by action; or whether, under that law, a judgment there obtained for the penalty might be enforced by execution, by scire facias, or by a new suit. In whatever form the state pursues her right to punish the offense against her sovereignty, every step of the proceeding tends to one end, the compelling the offender to pay a pecuniary fine by way of punishment for the offense.' 127 U.S. 299, 8 Sup.Ct. 1379, 32 L.Ed. 239.

Does the fact that under the statute upon which this action is based no part of the penalty goes to the state, but is for the sole benefit of the party injured, who, alone, can maintain the action therefor, distinguish it from the Wisconsin case? The only reported case which the court has been able to find, in which it was held that that case applies to all penalties, whether they are for the benefit of the state or a private person, is Hamilton v. Jos. Schlitz Brewing Company (C.C.) 100 F. 675, decided by the United States Circuit Court for the Northern District of Iowa; but, when the identical question came again before that same court (another judge presiding), the Hamilton Case was expressly overruled. United Breweries Co. v. Colby (C.C.) 170 F. 1008. The last case was removed by writ of error to the United State Circuit Court of Appeals, but was dismissed by the plaintiff in error without a hearing in that court. 178 F. 1005, 101 C.C.A. 664.

The leading case in which the English and American authorities on this subject, as well as Wisconsin v. Pelican Insurance Company, are fully reviewed, is Huntington v. Attrill, 146 U.S. 657, 667, 13 Sup.Ct. 224, 227, 36 L.Ed. 1123, and it was there held that:

'Penal laws, strictly and properly, are those imposing punishment for an offense committed against the state, and which, by the English and American Constitutions, the executive of the state has the power to pardon. Statutes giving a private action against the wrongdoer are sometimes spoken of as penal in their nature, but in such cases it has been pointed out that neither the liability imposed nor the remedy given is strictly penal.'

The statute there under consideration provided that the officers of any corporation who have made a certificate or report, or statements by public notice, which were false in any material representation, shall be jointly and severally liable for all the debts of the corporation contracted while they are officers thereof. This, it was claimed, was a penal action and for that reason could not be maintained in ...