United States v. Sosnowitz & Lotstein, Inc.

50 F. Supp. 586, 1943 U.S. Dist. LEXIS 2439
CourtDistrict Court, D. Connecticut
DecidedMarch 25, 1943
Docket6947
StatusPublished
Cited by6 cases

This text of 50 F. Supp. 586 (United States v. Sosnowitz & Lotstein, Inc.) is published on Counsel Stack Legal Research, covering District Court, D. Connecticut primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
United States v. Sosnowitz & Lotstein, Inc., 50 F. Supp. 586, 1943 U.S. Dist. LEXIS 2439 (D. Conn. 1943).

Opinion

HINCKS, District Judge.

The corporate defendant and its President, the individual defendant, are charged with violations of the Emergency Price Control Act of 1942 (E.P.C.A.), 56 Stat. 23, 50 U.S.C.A.Appendix, § 901 et seq., and the regulations issued pursuant thereto, by the sales of wholesale cuts of beef at prices in excess of the maximum prices fixed by said regulations. The defendants have filed a motion to quash the indictment, and a demurrer thereto, upon identical grounds.

The objection (demurrer, par. 16) that the Act is unconstitutional in that it purports to accomplish an unlawful delegation of legislative power is overruled on (he authority of the cases cited to the point in my memorandum of even date in United States v. Friedman, D.C., 50 F. Supp. 584.

The objection (demurrer, par. 17) that the Act invades the police powers of the States contrary to the Fifth and Fourth Amendments of the Constitution, is overruled. The Act is amply supported by the war powers of Congress under Art. 1, § 8 of the Constitution. Block v. Hirsh, 256 U.S. 135, 41 S.Ct. 458, 65 L.Ed. 865, 16 A.L.R. 165; Henderson v. Kimmel, D.C., 47 F.Supp. 635.

The objection (demurrer, par. 19) that the Act deprives the defendants of *588 liberty and property without due process of law, is overruled. There is nothing in the Act which purports to preclude any court whose process is invoked for the enforcement, of the Act from passing upon the basic constitutionality of the Act. Indeed, I have just above noted rulings sustaining the constitutionality of the Act against two specific attacks. And I now rule that although under the compulsion of criminal sanctions the Act subjects the defendants to the force of administrative regulations, it does not thereby deprive them of due process. This is so because, in sections 203 and 204, 50 U.S.C.A.Appendix, §§ 923 and 924, the Act itself provides an orderly procedure for review, bpth administrative and judicial, of administrative regulations which is open to any person directly affected.

Thus under Section 203, within sixty days after the effective date of a price schedule by the Administrator, any person subject thereto may file a protest with the Administrator, upon which he is entitled to a ruling within thirty days. If such protest is denied, the protestant, under section 924, may file his complaint with the Emergency Court of Appeals • which is vested with exclusive power to set aside the order complained of. And even after the initial, sixty-day, period of protest has expired, further protests may be filed if limited to “grounds arising after the expiration of such sixty days.” The action of the Emergency Court is subject to review on certiorari by the Supreme Court, but its action in setting aside a price schedule does not become effective until its order is affirmed if appealed, or becomes final through the expiration of the time for appellate proceedings. Indeed, power is expressly withheld to stay a price schedule until its order invalidating the schedule shall become final. Meanwhile the prescribed price schedule remains in effect.

To be sure, this power of review is not located in the District Courts which are charged with the task of applying the criminal sanctions created by the Act. Instead, the judicial power of administrative review is entrusted only to the Emergency Court of. Appeals which is created by the Act.. But there is nothing inherently unconstitutional. in such a division of jurisdiction.

Nor is .such a division of .jurisdiction wholly novel. As Judge Wyzanski, in passing on this point, pointed out in United States v. B. Rottenberg Co., U.S.D.C.Mass., 48 F.Supp. 913, neither a shipper nor a carrier may question the legality of a railroad rate subject to regulation under the Interstate Commerce Act, 49 U.S.C.A. § 1 et seq., until the reasonableness, and hence the validity, of the rate shall have first been determined by the Interstate Commerce Commission. To hold otherwise would seriously jeopardize the Congressional objective that rates should be uniform, and free from unjust discriminations. Texas & Pacific Ry. Co. v. Abilene, 204 U.S. 426, 27 S.Ct. 350, 51 L.Ed. 553, 9 Ann.Cas. 1075; Mitchell Coal Co. v. Pennsylvania R. Co., 230 U.S. 247, 33 S.Ct. 916, 57 L.Ed. 1472. Thus a shipper charged by indictment with having received an unlawful rebate may not defend on the ground that the published, lawful rate was unreasonable and that the rebate served only to bring the rate into harmony with reason. United States v. Vacuum Oil Co., D.C., 158 F. 536.

To be sure, a citizen adversely affected by railroad rates prescribed by the Interstate Commerce Commission may not only apply to a court to have the rates set aside but he may, at least in a proper case, under the Urgent Deficiencies Act obtain a temporary stay thereof, thereby avoiding the impact of criminal sanctions while his challenge to the validity of the rates is in progress. 28 U.S.C.A. § 47. Merchants’ Warehouse Co. v. United States, 283 U.S. 501, 51 S.Ct. 505, 75 L.Ed. 1227. This same safeguard was carried over into the Communications Act of 1934, § 402(a), 47 U.S.C.A. § 402(a), Scripps-Howard Radio v. F. C. C., 316 U.S. 4, 62 S.Ct. 875, 86 L.Ed. 1229; and into the Packers and Stockyards Act of 1921, § 316, 7 U.S. C.A. § 217. See Inghram v. Union Stockyards, 8 Cir., 64 F.2d 390; Tagg Bros. & Moorehead v. United States, 280 U.S. 420, 50 S.Ct. 220, 74 L.Ed. 524; Morgan v. United States, 298 U.S. 468, 56 S.Ct. 906, 80 L.Ed. 1288; Id., 304 U.S. 1, 58 S.Ct. 773, 999, 82 L.Ed. 1129 and United States v. Morgan, 307 U.S. 183, 59 S.Ct. 795, 83 L.Ed. 1211.

And this familiar and salutary technique of administrative review, doubtless due to the stress of present urgencies has been discarded by the draftsmen of E. P. C. A. Jurisdiction to review the validity of a price schedule is expressly *589 withheld from the District Courts, even when constituted as provided by the Urgent Deficiencies Act, 28 U.S.C.A. § 47. And even the newly constituted Emergency Court of Appeals, it is provided, “shall not have power to issue any temporary restraining order or interlocutory decree staying or restraining, in whole or in part, the effectiveness” of a price schedule. 50 U.S.C.A.Appendix, § 924(c).

But this limitation upon the usual power of judicial review does not constitute a denial of due process. True it is that one who elects to violate may -be convicted and sentenced for the violation of a schedule which may later be found to be invalid by the Emergency Court.

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50 F. Supp. 586, 1943 U.S. Dist. LEXIS 2439, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-states-v-sosnowitz-lotstein-inc-ctd-1943.