UNITED STATES v. 15 CASES OF BRED SPRED, ETC., ET AL.

(Circuit Court of Appeals, Seventh Circuit, Oct. 25, 1929)

35 Fed. (2d) 183; N.J. No. 17352

In error to the District Court for the District of Indiana. Judgment affirmed.

Before ALSCHULER, EVANS, and PAGE, Circuit Judges.

PAGE, Circuit Judge. The Government (appellant) libeled, in the United States District Court for the Southern District of Indiana, under the Food and Drugs Act, a food product called "Bred Spred," manufactured by claimant (appellee) at Chicago, and shipped into Indiana. Appellant abided by its overruled demurrer to each of the two paragraphs of appellee's answer, and the libel was dismissed. The first paragraph of the answer sets out, as an estoppel by judg ment, the complete record, other than the evidence, of a case in a Federal District Court of Michigan, wherein a judgment, unappealed from, was adverse to the Government.

Concerning the second paragraph of the answer, appellant in its brief, makes the admission that it "consists of specific denials of the various averments of the libel and explanations, constituting together a plea of confession and avoidance." It is not a plea of confession and avoidance, but we find that it is a good and sufficient answer to the libel, and that as to that paragraph the court properly overruled the demurrer and dismissed the libel. The propriety of the court's action in that regard is not discussed or questioned by appellant. On the contrary, after the above admission, appellant abandoned the issue on the second paragraph and said: "The contested issues here, then, arise upon the views held and ruling made by the judge of the District Court upon the questions of former adjudication and estoppel raised by the first paragraph of amended answer." That must end the case. With a good defense upon the merits admitted, it cannot matter how many errors may be committed by a trial court on any issue upon which a case cannot be reversed. If we should hold with the contention of the Government on the first paragraph, we could not, for that reason, reverse the judgment. The judgment is affirmed.

AMBRUSTER v. MELLON, SECRETARY OF THE TREASURY, ET AL. (Court of Appeals of District of Columbia, May 5, 1930)

41 Fed. (2d) 430

Appeal from a decree of the Supreme Court of the District of Columbia dismissing a bill for injunction to restrain the Secretary of the Treasury, the Secretary of Agriculture, and the Secretary of Commerce from permitting importations of certain kinds of a drug. Affirmed.

Before MARTIN, Chief Justice, and Rовв and VAN ORSDEL, Associate Justices.

MARTIN, Chief Justice. An appeal from a decree of the lower court dismissing the amended bill of complaint of the plaintiff, upon motion of the defendants.

The plaintiff below sought an injunction to restrain the Secretary of the Treasury, the Secretary of Agriculture, and the Secretary of Commerce, from permitting the importation into this country of certain kinds and conditions of ergot of rye, which plaintiff claims to be under the legal standard, and dangerous to the public health when used, claiming also that such importations resulted in irreparable injury to plaintiff as an importer and owner of large stores of ergot of rye, already imported into this country, of standard character and usefulness.

It is recited in the bill that ergot of rye is a crude drug consisting of grains of rye which have been peculiarly altered in substance by a certain fungus growth. From the crude article is manufactured what is known as "fluid extract of ergot", which is a valuable preparation extensively used by physicians for emergencies in obstetrical cases. Both the crude drug and the extract are listed and described in the United States Pharmacopeia and National Formulary, as well as other works on materia medica. There is practically no crude ergot produced in this country. Importations of a superior class arrive here from Spain, while inferior products come from certain other foreign countries. The latter importations frequently arrive in bad condition and are unfit to be used in the manufacture of the medicinal extract. The plaintiff charges that the defendants, the Secretary of the Treasury and the Secretary of Agriculture, have since September 1, 1927, in violation of section 7 of the Federal Food and Drugs Act (34 Stat. 768 (21 U.S.C. sec. 8)), and of regulation 30, subsection B, of the regulations for the enforcement of the Federal Food and Drugs Act, knowingly admitted through the customs house crude ergot of rye of inferior quality and condition and not fit for use in the manufacture of medicinal extract of ergot; and that the defendants have knowingly and willfully permitted various quantities of substandard crude ergot thus imported, to be sold and shipped in interstate commerce in this country under false and misleading brands, without causing them to be seized by the proper officers for condemnation, destruction, or export. Plaintiff also states that he has lawfully imported into this country and holds in stock large quantities of pure standard ergot of rye of superior quality and value, and that he will suffer great loss if inferior ergot is allowed to be put upon the market under misleading brands and false descriptions.

The plaintiff prayed that the defendants be enjoined from admitting into this country importations of crude ergot of rye which do not, upon proper examination, meet all the requirements of the Federal Food and Drugs Act and the United States Pharmacopeia, and to recall all stocks already admitted which do not comply therewith; and that defendants be required to enforce the act so as to prevent the entry of crude ergot into this country when impure and beneath the standard, and also "be required to act with all due and prompt

diligence in the enforcement of the said act, in the public health interest. * * *""

In our opinion the ruling of the lower court dismissing the bill of complaint was right, for the reason, among others, that the proceedings of the defendants which are challenged by the bill were performed by them in the lawful exercise of their jurisdiction under the statute, and their action is not shown to be capricious or arbitrary, and consequently is not reviewable in a suit for an injunction.

Section 2 of the Federal Food and Drugs Act (21 U.S.C. sec. 2) forbids the importation into this country from any foreign country, of any drug which is adulterated or misbranded within the meaning of the act. Section 3 (21 U.S.C. sec. 3) provides that the Secretary of the Treasury, the Secretary of Agriculture, and the Secretary of Commerce shall make uniform rules and regulations for carrying out the provisions of the act. Sections 7 and 8 (21 U.S.C. secs. 8, 9) define the conditions under which a drug shall be considered as adulterated or misbranded. Section 11 (21 U.S.C. sec. 15) provides for a proceeding whereby the Secretary of Agriculture may examine samples of any drug offered to be imported into the United States, in order to determine whether it is adulterated or misbranded within the meaning of the act, or is otherwise dangerous to health, or is falsely labeled in any respect; and any drug found to be of such description shall be refused admission. In accordance with the provisions of the act the Secretary of the Treasury, the Secretary of Agriculture and the Secretary of Commerce promulgated certain official regulations for the enforcement of the Federal Food and Drugs Act, and the same have been continuously in force under the act.

The statute accordingly invested the appellees with authority to determine whether imported drugs were adulterated or misbranded in the sense of the act, when offered for entry into this country. Such authority is not simply ministerial in character, but calls for a finding of facts and the exercise of judgment upon the facts when found. Accordingly the exercise of this authority by the appellees will not be reviewed by the courts unless it has been capriciously or arbitrarily exercised.

In Commercial Solvents Corporation v. Mellon, Secretary of the Treasury, 51 App.D.C. 146, 277 Fed. 548, an order of the Secretary was challenged, which provided that fusel oil should not be considered to be a synthetic organic chemical within the meaning of the Dye and Chemical Control Act, approved May 27, 1921 (42 Stat. 18). It was held by the court that the authority given to the Secretary of the Treasury by the act, to administer the same, gave him the implied authority to interpret it, because interpretation was necessary to the performance of his administrative duty; and that the courts cannot review, by mandamus or injunction, a decision of the Secretary of the Treasury, made within his jurisdiction, to interpret the act, if he did not act in a capricious or arbitrary manner. Accordingly the court sustained the dismissal of a bill for an injunction to restrain the enforcement of the Secretary's order.

In support of this ruling, the court cited New Orleans v. Paine, 147 U.S. 261, 13 S.Ct. 303, 37 L.Ed. 162; Riverside Oil Co. v. Hitchcock, 190 U.S. 316, 23 S.Ct. 698, 47 L.Ed. 1074; Ness v. Fisher, 223 U.S. 683, 32 S.Ct. 356, 56 L.Ed. 610; Duncan Townsite Co. v. Lane,

245 U.S. 308, 38 S.Ct. 99, 62 L.Ed. 309; Houston v. St. Louis Packing Co., 249 U.S. 479, 484, 39 S.Ct. 332, 63 L.Ed. 717; Brougham v. Blanton Mfg. Co., 249 U.S. 495, 39 S.Ct. 363, 63 L.Ed. 725; Hall v. Payne, 254 U.S. 343, 41 S.Ct. 131, 65 L.Ed. 295; Handel v. Lane, 45 App.D.C. 389; United States ex rel. Ashley v. Roper, 48 App.D.C. 69; United States ex rel. Hall v. Lane, 48 App.D.C. 279.

In our opinion, the bill discloses that the defendants below were invested with authority to pass upon the admission of the importations complained of, and fails to allege facts from which it can be inferred that their action in respect to the present importations was capricious or arbitrary.

The decree of the lower court is therefore affirmed.

UNITED STATES v. SHREVEPORT GRAIN & ELEVATOR CO. (District Court, W.D. Louisiana, Sept. 16, 1930)

46 Fed. (2d) 354; N.J. No. 18300

Information alleging violation of section 2 of the Food and Drugs Act. Demurrer to information sustained.34

DAWKINS, District Judge. This is a criminal information, charging the defendant with misbranding certain corn bran, in violation of the Pure Food and Drugs Act of June 30, 1906 (34 Stat. 768, 21 U.S.C. secs. 1-5, 7-15) in that each sack of said product was branded as containing 100 pounds net, whereas in truth they contained a lesser quantity. By amendment it is charged that some of the sacks contained not more than 85 pounds net, and that the average was about 96 pounds.

Defendant moved to quash the information on the ground that said act violates articles 1, 2, and 3 of the Federal Constitution because it attempts "to grant legislative powers to the judiciary and to the executive departments of the Government"; and it violates the fifth amendment to the Constitution, in that it "seeks to deprive of life, liberty, and property without due process of law", as well as the fourteenth amendment, "for the same reason"; and, further, that it violates the sixth amendment because "it is too indefinite, sets up no ascertainable standard of guilt and defendant cannot be informed of the nature and cause of the accusation against it thereunder." After declaring that sacks or packages containing articles of food shall have the net weight or measure plainly stamped thereon, the third paragraph of section 8 of the act as amended (37 Stat. 732, (21 U.S.C. sec. 10, par. 3) provides as follows:

Third. If in package form, the quantity of the contents be not plainly and conspicuously marked on the outside of the package in terms of weight, measure, or numerical count. Reasonable variations shall be permitted, and tolerances and also exemptions as to small packages shall be established by rules and regulations made in accordance with the provisions of section 3 of this title.

It must be remembered that this is a criminal action for the alleged violation of this statute, one of the very few that have been brought

34 Reversed by Supreme Court, United States v. Shreveport Grain & Elevator Co., p. 1339 post.

thereunder, and, while the proceeding is against a corporation, it might easily have been one charging an individual, who in default of payment of fine could be subjected to imprisonment. Hence a much stricter construction is required than if it were merely an act affecting civil rights. I have no doubt that Congress has the power, for the protection of the public, to require that packages containing articles of food shall have stamped thereon the correct weight or number, and that the dealer, without having any fraudulent or criminal purpose, may, in an extensive business, be unable to comply exactly in each instance with this requirement. However, in such circumstances, it would be a question of intent for the court and jury, if there was a variation, but the dealer would have a fixed standard by which to be guided, whereas under the quoted provision of the act, its violation, in large measure, is left either to the discretion of the enforcing department in making rules or regulations, or to the judgment of the court and jury in each instance as to what is reasonable. This might vary according to the views of the particular tribunal, and the dealer could never know whether he was violating the law or not until he was brought into court.

For these reasons, I believe the asserted ground of unconstitutionality under the sixth amendment, is well founded. See United States v. L. Cohen Grocery Co., 255 U.S. 81, 41 S.Ct. 298, 65 L.Ed. 516, 14 A.L.R. 1045; Connally v. General Const. Co., 269 U.S. 385, 46 S.Ct. 126, 70 L.Ed. 322; Yu Cong Eng v. Trinidad, 271 U.S. 500, 46 S.Ct. 619, 70 L.Ed. 1059; United States v. Reese et al., 92 U.S. 214, 23 L.Ed. 563; United States v. Brewer, 139 U.S. 278, 11 S.Ct. 538, 35 L.Ed. 190; Todd v. United States, 158 U.S. 282, 15 S.Ct. 889, 39 L.Ed. 982.

For the reasons assigned the demurrer or motion to dismiss will be sustained. Proper decree may be presented.

UNITED STATES v. 2312 DOZEN BOTTLES, ETC., OF AN ARTICLE OF DRUGS LABELED IN PART "LEE'S SAVE THE BABY"

(District Court, D. Connecticut, Jan. 8, 1930, Oct. 17, 1930)

44 Fed. (2d) 831; N.J. No. 18653

Motion to

Libel under section 10 of the Food and Drugs Act. strike out portions of claimant's answer, granted. Trial before the court. Decree in favor of claimant.

THOMAS, District Judge (on motion to strike out portions of claimant's answer). The United States filed its libel for condemnation against certain bottles and their contents shipped in interstate commerce and prayed that the same be condemned upon the ground that they were misbranded within the meaning of the Food and Drugs Act. The libel alleges the transportation as of January 15, 1929. The bottles were labeled "Save the Baby." On the back of the bottle is a label setting forth the following:

* *

* cloth and laying it

For Croup apply with the hand or by saturating over the throat and chest; also apply over the nose. In severe cases, where relief does not follow in half an hour, give a half teaspoonful internally every half