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The reach and consequences of such a doctrine are almost beyond comprehension because the right to buy or sell in interstate commerce is essential to every corporation. This doctrine would make every minute detail of any corporate business subject to Federal regulation. Congress could even place a Federal manager in control of every corporation. Such a principle would have avoided all doubts of Federal regulatory power in the past. (R. 202.)

This principle heretofore advanced in support of other legislation, such as the child labor act and the first employers' liability act, was repudiated by the Supreme Court, which held that the Federal Government could not constitutionally extend its control to matters of local business simply because the corporation was engaged in interstate commerce, or as a condition to conducting such commerce. (R. 203.)

The first child labor act prohibiting the transportation in interstate commerce of goods made by child labor was declared unconstitutional (1

(Hammar v. Dagenhart, 247 U. S. 251), on the ground that it was an invasion by the Federal Government of the field exclusively reserved to the regulatory power of the State. The court said:

“In our view the necessary effect of this act is by means of a prohibition against the movement in interstate commerce of ordinary commercial commodiies to regulate the hours of labor of children in factories and mines within the States, a purely State authority. Thus the act in a twofold sense is repugnant to the Constitution. It not only transcends the authority delegated to Congress over commerce, but also exerts a power as to purely a local matter, over which the Federal authority does not extend. The far-reaching result of upholding the act can not be more plainly indicated than by pointing out that if Congress can thus regulate matters intrusted to local authority by prohibition of the movement of commodities in interstate commerce, all freedom of commerce will be at an end, and the power of the States over local matters may be eliminated, . and thus our system of government be practically destroyed.” (R. 203.)

Congress then enacted a statute imposing a tax upon any business employing child labor contrary to the conditions prescribed and that statute was likewise declared unconstitutional upon the same principles as in the first case. (Child Labor Tax case, 259 U. S. 20.)

A corporation by engaging in interstate commerce does not subject its business to Federal control or supervision. (Employers' Liability cases, 207 U. S. 463.)

These cases establish the principle that the Federal Government does not possess the power claimed. As soon as Congress undertakes to impose terms which result in a regulation of matters within the exclusive jurisdiction of the State, the statute becomes unconstitutional. (R. 204.) The pending bill undertakes to regulate the mining of coal and to control the relations of employer and employee while engaged in that occupation, both of which are purely matters of State power.

Mr. Warrum's original argument (somewhat modified later in his oral argument) rests upon two false premises : First, that a State has the absolute right to exclude foreign corporations and therefore to admit them upon such conditions, however arbitrary, as the State sees fit to impose; and second, that the Federal Government, as an attribute of national sovereignty has the absolute right to exclude all corporations from interstate commerce and therefore to admit them upon such conditions, however arbitrary, as the Federal Government sees fit to impose. (R. 205.)

This argument leads to the conclusion that the State may impose upon a corporation, as a condition to its admission, a complete control over all its affairs, both local and interstate; and at the same time the Federal Government may impose upon the same corporation as a condition to engaging in interstate commerce a complete control over all the affairs of the corporation, both interstate and local. Manifestly the two propositions can not stand together; one destroys the other. There are limitations upon both the State and the Federal Government. As soon as the conditions imposed by either extend into the field exclusively under the control of the other, they become repugnant to the Federal Constitution. (R. 206.)

As to the Federal Government, this rule is established by the child labor and employers' liability cases above cited. (R. 206.)

As to the States, conditions upon the admission of foreign corporations to do local business must not burden or regulate the interstate commerce of such corporations. (Looney v. Crane, 245 U. S. 178; International Paper Co. v. Massachusetts, 246 U. S. 135; Alpha Cement Co. v. Massachusetts, 268 U. S. 203, 218 ;; Frost Trucking Co. v. R. R. Commission, 271 U. S. 583.) (R. 207.)

States are also prohibited from imposing as conditions of admission the requirement that any other right under the Federal Constitution shall be surrendered. (Barrow Steamship Co. v. Kane, 170 U. S. 100, 111, and Frost Trucking Co. v. R. R. Commission, supra.) (R. 208.)

Two cases cited by Mr. Warrum do not support his argument, as shown by the Supreme Court's reference to them in subsequent opinions. Paul v. Virginia (8 Wall. 168) was modified in Pensacola Telegraph Co. v. Western Union Telegraph Co. (96 U. S. 1, 12, 13); and Security Mutual Insurance Co. v. Prewitt (202 U. S. 246) was expressly overruled in Terral v. Burke Construction Co. (257 U. S. 529, 533).

Mr. Warrum apparently recognizes no limitations upon the powers of the Federal and State Governments except those arising out of the fifth and fourteenth amendments; but these two amendments do not contain all the limitations upon the State and Federal Governments. The State power is also subject to limitations arising out of the commerce clause of the Constitution; and the power of the Federal Government is subject to limitations arising out of the tenth amendment, which prohibits the Federal Government extending its functions into the field of local business. (R. 209.)

Federal power in the field of interstate commerce is subject to all the limitations imposed by the Constitution, including the fifth amendment and the tenth amendment, which would apply even if the power existed to require corporations engaged in interstate commerce to take out a license, which is denied. The conclusion is inescapable that the Federal Government can not, as a condition to admission to interstate commerce, regulate or supervise local business such as the mining of coal. (R. 209.)

Congress does not have the absolute power to exclude coal or the corporate shipper thereof from interstate commerce. Even if a State did have absolute power to exclude foreign corporations from intrastate business, it would not follow that the Federal Government has a like power with respect to State corporations which may desire to engage in interstate commerce. Federal power and State power are not analogous in this respect; the two governments differ in nature and origin. The State governments were originally independent complete sovereignties; and they so continue, except in so far as they haye affirmatively delegated powers to the Federal Government; the Federal Gov-. ernment in its origin was a union of Sovereign States created as an agency for united action on limited subjects. It was never created as an independent supreme sovereignty, but only as a limited agency of enumerated powers. (R. 210.)

The absolute power to exclude from interstate commerce would be an attribute of a supreme and complete sovereignty which the Federal Government never had. Its only power over interstate commerce is to regulate. Exclusion is permissible only when appropriate and necessary as a method of regulation. (R. 210.)

Federal power to exclude applies only to commodities which were objectionable in and of themselves because deleterious to health or good m als or likely to result in deception or to assist in the commission or concealment of crime. There the exclusion is not concerned primarily with the commodity itself, as in the proposed bill, but is a method necessary to accomplish an end legitimately within the field of congressional power. None of those cases support any power on the part of Congress to exclude from interstate commerce an article like coal, which is not objectionable in and of itself and which is not likely to cause harm to health or morals. (Hammer v. Dagenhart, 247 U. S. 251.) (R. 210.) The distinction between the two classes of cases is pointed out in Brooks 7. U, S. (267 U, S. 432).

The delegation of the power to regulate commerce was for the purpose of promoting and insuring a free and unrestricted interstate commerce. If Congress be allowed the absolute power of exclusion or power to admit in interstate commerce only on such terms as it sees fit to prescribe, the result would be to destroy the very freedom of commerce which it was the purpose of the Constitution to preserve and foster. (R. 211.)

The Federal Government has not the power to exclude from interstate commerce an article such as coal or to forbid corporations created by the several States from shipping in interstate commerce coal or other ordinary articles of commerce. Even if it did have such power it could not be exercised by imposing as conditions, a regulation of intrastate business, a matter exclusively within the jurisdiction of the States and reserved to them by the tenth amendment. (R. 211.)


Congress has complete power to regulate interstate commerce, but under the guise of such regulation the Federal Government can not oust the State from its rightful jurisdiction over matters confided to them, such as production and mining. (R. 212.)

The argument of Mr. Warrum that the coal industry is impressed with the public service is contrary to the decisions of the Supreme Court. In Wolff Co. v. Industrial Court (262 U. S. 522) the Supreme Court said :

“It has never been supposed since the adoption of the Constitution that the business of the butcher, the baker, the tailor, the woodchopper, the mining operator, or the miner was clothed with such a public interest that the prices of his product or his wages could be fixed by State regulation." (R. 212–213.)

In Williams v. Standard Oil Co., decided January 2, 1929, the Supreme Court held that a Tennessee statute regulating the price of gasoline on the theory that such business was affected with the public interest, was unconstitutional. A business is not affected with a public interest merely because of its extent. Tyson v. Banton (273 U. S. 418) contains an exhaustive review of this class of cases. (R. 213.)

The fact that a business may be affected with a public interest forms no independent basis for Federal regulation. The grant of Federal power must be found in the Constitution; and nowhere does it grant power concerning any matter or thing because it is affected with a public interest. Even if it were held that coal mining is affected with a public interest, the regulation of production would be in the State where the coal is produced and not in the Federal Government. (R. 213–214.)

If the suggestion that coal is an instrumentality of interstate commerce means any commodity used in transporting other commodities from one State to another State, then coal when used as railway fuel is an instrumentality of interstate commerce; but to the same extent are rails, ties, steel, lumber, and every other commodity which a railroad may use in building the facilities for transportation or which may be consumed in the act of transportation. The power of Congress to regulate them is limited to the time when they are so used. It could not be extended to the mining of coal or the manufacture of steel and other commodities generally. (R. 214.)

The power of Congress to forbid restraints of interstate commerce, as applied in United Mine Workers v. Coronado (259 U. S. 344), does not extend its power to the regulation of the production of coal itself. It is not now claimed and there is no evidence that there exists any restraint on interstate commerce in coal; on the contrary there is a superabundance of coal, and commerce therein is free and unrestrained. The bill proposes to authorize certain restraints on interstate commerce in coal which are illegal under the present law. (R. 214-216.)

The mining of coal is not interstate commerce, is not commerce at all; it is purely local intrastate business. (Citing cases.) (R. 216.) There seems to be no dissent from this proposition.

The bill is unconstitut al because it attempts to regulate the mining of coal, a matter beyond any power expressly delegated to the Federal Government and one expressly reserved to the several States by the tenth amendment. (R. 217.)

The bill is unconstitutional in that it attempts to regulate the relations between employers and employees engaged in a business which is not interstate

The Federal Government may not regulate all employer-employee relations of corporations, even though engaged in part in interstate commerce, (First Employers' Liability case, 207 U. S. 463.) (R. 217.)

Congress may not do by indirection what it can not do directly. All apparently agree that if Congress undertook by direct action to regulate the subject of the proposed legislation, such effort would be declared unconstitutional. The proponents of the bill argue that by adopting an indirect method through a system of issuing licenses, the desired results can be accomplished and the constitutional restrictions thus escaped, which idea is expressed by Mr. John L. Lewis in his statement before the committee. (R. 217.)

But the power of Congress can not be enlarged or broadened by the adoption of any such indirect method. (Hammer v. Dagenhart, 247 U. S. 251: Child Labor Tax case, 259 U. S. 20.) " The controlling influence of the Constitution may not be destroyed by doing indirectly that which it prohibits from being done directly.” (Pullman Co. v. Kansas, 216 U. S. 56, 70.) (R. 218.)

In Frost Trucking Co. v. Railroad Commission (271 U. S. 583), the Supreme Court was considering a State statute which, by a method quite similar to that



adopted in the pending bill, undertook to accomplish by indirection results which could not have been accomplished directly. The State of California provided that no corporation should use the State highways for motor trucking unless it subjected itself to regulation as a public carrier, which requirement it was proposed to enforce by a system of licenses, which could be obtained only by agreeing to become a public carrier. The court vigorously condemned this attempt to circumvent the Constitution, saying:

* Having regard to form alone, the act here is an offer to the private carrier of a privilege, which the State may grant or deny, upon à condition which the carrier is free to accept or reject. In reality, the carrier is given no choice, except a choice between the rock and the whirlpool, an option to forego a privilege which may be vital to his livelihood or submit to a requirement which may constitute an intolerable burden.

" It would be a palpable incongruity to strike down an act of State legislation which by words of express divestment seeks to strip the citizen of rights guaranteed by the Federal Constitution, but to uphold an act by which the same result is accomplished under the guise of a surrender of a right in exchange for a valuable privilege which the State threatens otherwise to withhold. It is inconceivable that guaranties embedded in the Constitution of the United States may thus be manipulated out of existence." (R. 218–219.)

This decision denies the existence of any indirect method by which Congress can accomplish the results sought in this bill; it supports with unanswerable logic the proposition that Congress may not do by indirection what it can not do directly. (R. 219.)

The bill is unconstitutional because it attempts to fix the price of coal, as the business of mining coal is not impresed with the public interest. (Wolff Co. v. Industrial Courts, 262 U. S. 522; Tyson & Bro. v. Banton, 273 U. S. 418; Williams v. Standard Oil Co., decided January 2, 1929.) (R. 219.)

The bill is unconstitutional because it attempts to control contracts between employer and employee in intrastate business. A Federal statute making it a crime to discharge an employee of an interstate carrier on the ground that he was a member of a labor organization was held unconstitutional. (Adair v. United States, 208 U. S. 161, 174-180.) The right to make contracts of employment with relation to membership or nonmembership in labor unions is protected by the Constitution; and neither the State nor the Federal Government can take away that right. (Smith v. Texas, 233 U. S. 630; Coppage v. Kansas, 236 U. S. 1, 20-21; Hitchman Coal & Coke Co. v. Mitchell, 245 U. S. 229, 251.) (R. 219.)

The bill is unconstitutional because it is class legislation, in that it sets up a limited exemption from the antitrust laws, applicable only to bituminous coal mining and not applicable to all persons similarly situated. (Connolly v. Union Sewer Pipe Co., 184 U. S. 540, 558, 564.) Any modification of the antitrust laws should apply generally and not to a single industry such as bituminous coal, producing only one of several kinds of competing fuels. (R. 220.)

The bill is unconstitutional because Congress does not prescribe the standard by which the commission shall be governed. (Field v. Clark, 143 U. S. 649, 692-694, and other cases.) (R. 220.)

The bill is unconstitutional because it is vague and indefinite; it would punish criminally without defining the crime with sufficient definiteness and certainty to constitute due process of law or to inform the defendant of the nature and cause of the accusation brought against him. (United States v. Cohen Grocery Co., 255 U. S. 81; Connally v. General Construction Co., 269 U. S. 385, 391–392.) It is likewise void for indefiniteness in the civil duties prescribed. (Small Company v. American Sugar Refinery, 267 U. S. 233.) (R. 220.)

It should not be forgotten that Federal statutes affecting the bituminous coal industry already exist, such as paragraphs 15, 16, and 17 of section 1 of the interstate commerce act, which provide for the control of distribution of commodities in times of emergency, and the provisions authorizing the Secretary of Labor to act as mediator and to appoint commissioners of conciliation in labor disputes. (R. 221.)

The West Virginia Coal Association, by Attorney A. M. Belcher, of Charleston, W. Va.

The right to do business is a property right, to be protected, but not destroyed, by legislation. Legislation giving preference to any special industry or business is class legislation and void. This bill relates only to bituminous coal and does not affect any other coal or other fuels with which bituminous coal competes. (R. 151.)

Coal deposits are in private ownership in the various States and hence are not the property of the Federal Government. Congress does not have power to regulate or control the ownership or production of coal from privately owned lands in any State. The production of coal is not interstate commerce. (Delaware & Lackawanna, etc., Railroad Co., 238 U. S. 439.) (R. 151.)

Although Congress may in national crises, such as war, regulate the flow of coal in interstate commerce, it can not do so in times of peace without violating constitutional rights, such as the absolute right to engage in interstate commerce in coal and to make contracts of sale in any State in the Union and to contract for the purchase of coal wherever desired. (R. 152.)

Congress can exercise only the powers delegated to it; such powers do not include regulation of private property belonging to citizens or persons, including corporations. The production of coal is a legitimate business violative of no law; it is subject to the control of the State only. (R. 153, 154.)

Overproduction of bituminous coal and the resulting inability to obtain a fair price are urged as reasons for the proposed bill, which must therefore seek to restrict production and increase prices. Productive capacity, reduced 40 per cent, would still supply the demand. There is no legal way to compel those owning coal to reduce their production 40 per cent, or to compel a part of the producers to buy out the remainder. Any governmental attempt to stop the business of 40 per cent of the producers would be confiscation and would deprive the owners of their properties without due process of law, and would also infringe upon the property rights of sovereign States and violate every tradition of constitutional government. (R. 153.)

One engaged in this legitimate private business can not be required, as a condition to engaging in interstate commerce, to submit to the proposed regulations of this bill. Such a power is not within the power of Congress over interstate commerce as defined in Leisy v. Hardin (135 U. S. 108). (R. 154.)

As stated in the brief of proponents, “To carry on interstate commerce is not a franchise or a privilege granted by a State; it is a right which every citizen of the United States is entitled to exercise under the Constitution and laws of the United States." (Crutcher v. Kentucky, 141 U. S. 47.) The power of Congress over interstate commerce " is the power to regulate; that is, to prescribe the rule by which commerce is to be governed.” (Gibbons v. Ogden, 9 Wheat. 1.) (R. 154.)

Hammer v. Dagenhart (247 U. S. 269) definitely settles that Congress does not have the power to do the things proposed in the bill. (R. 154, 155.)

The purpose of the antitrust laws was to prevent restrictions of commerce. The proposed bill would be a reversal of that policy; it would authorize and, in fact, require restrictions of interstate commerce. (R. 155.)

The bill violates the fifth amendment of the Constitution, which provides that no person shall be deprived of property without due process of law.

The right of the owner to fix a price at which his property shall be sold or used is an inherent attribute of the property itself (State Freight Tax case, 15 Wall. 232, 278), and as such, within the protection of the due process of law clauses of the fifth and fourteenth amendments.” (Tyson v. Banton, 273 U. S. 429.) (R. 155, 156.)

There is no similarity between the sale of coal and the sale of transportation by a railroad, the one being a private business and the other a public-service corporations. (R. 156, 157.)

Conservation of coal belonging to private individuals is a matter of State regulation; it is not within the power of Congress. If the local authority fails to regulate production, Congress is not authorized to do so. (R. 158, 159.)

The requirements of the proposed bill destroy freedom of contract so far as it concerns quantity produced and price. (R. 160, 161.)

Coal is not impressed with the public use, and is not comparable with cases where public health or morals are concerned. (R. 161.) (Wolff Packing Co. v. Court, 262 U. S. 537; Butcher's Union v. Crescent City, 111 U. S. 757.)

“A business is not affected with a public interest merely because it is large or because the public are warranted in having a feeling of concern in respect to its maintenance.” (Tyson v. Banton, 273 U. S. 430.)

The production of coal does not fall within the three classes which the court described in Wolff Packing Co. case, supra, as affected with the public interest, or “impressed with the public use.' (R. 162.)

The argument that as a State has the right to license a foreign corporation on conditions imposed, it follows that Congress, having the right to regulate interstate commerce, has the power to impose conditions under which coal is to

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