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National Labor Relations Board v. Suburban Lumber Co.

June 30, 1941


Appeal from National Labor Relations Board.

Author: Clark

Before BIGGS, MARIS, CLARK, JONES, and GOODRICH, Circuit Judges.

CLARK Circuit Judge.

Our courts have been addressed by the constant contention that the National Labor Relations Board lacks jurisdiction.*fn1 This is the more remarkable in view of its complete lack of success. Locusts destory but appeals against regulation by the National Labor Relations Board of business on the ground that it is intrastate are harmless insects indeed. We know of only one case in which any court has dismissed the Board's petition for that reason. There the business sought to be controlled was a California gold mining company and the only interstate elements were the purchase of supplies manufactured outside the state and the shipment of some gold to a mint in Colorado.*fn2

How different is the case at bar appears from its undisputed facts. The respondent is a retail lumber dealer of Oaklyn, near Camden, New Jersey. The cash value of its sales for 1936 was a little over $200,000 and 99% of them were made within New Jersey. In the same period the Suburban's purchases were slightly less than $150,000. Inasmuch as New Jersey was settled before the days of conservation, this lumber came from other parts of the country, as might be expected. The record does not show precise percentages but there is testimony that 90% of the purchases were made from twelve named firms, all but one of which were located outside of New Jersey. In addition to two managing officials and three office workers, respondent had ten or eleven other employees, seven of whom were truck drivers. The lumber was mostly picked up at Philadelphia wharves and the general manager estimated that 16% of his drivers' time was so consumed. The Board has found that there is substantial evidence to support the conclusion that seven of these drivers were discharged for joining the International Brotherhood of Teamsters, Chauffeurs, Stablemen and Helpers of America. On August 2, 1937 the Board ordered reinstatement of and back pay from the day of discharge for these seven employees. The Act*fn3 provides that the Board shall "cause" such an order "to be served" on the persons affected thereby. By a further provision of the same Act, the service requirement is held to be complied with: "* * * either personally or by registered mail or by telegraph or by leaving a copy thereof at the principal office or place of business of the person required to be served." 29 U.S.C.A. ยง 161(4).

In the principal case the respondent received at its only office a copy of the Board's decision which contained an order ending as follows: "(e) Notify the Regional Director for the Fourth Region in writing within ten (10) days from the date of this order what steps the respondent has taken to comply herewith." Appendix to Respondent's Brief p. 3.

From this recital it is clear that respondent can advance only two arguments against jurisdiction. It can argue size and it can argue direction. The first contention has been expressly decided against it by the United States Supreme Court*fn4 and the second is untenable by the ratio decidendi of its decisions. We are concerned here with the utilization rather than the extent of the commerce power. The National Labor Relations Act uses what have been described as words of art to indicate the fullest employment of this Congressional authority.*fn5 The selection of the word "affect" is of recent origin. Although it appears in the language of some of the earlier Supreme Court opinions,*fn6 it only found its way into relatively new legislation, and so is not present in such statutes as the Federal Trade Commission,*fn7 the old Employers' Liability Act,*fn8 and the Sherman Act.*fn9 They qualify interstate commerce with such words as "in", "engage in" or "restraint",*fn10 whereas such modern statutes as the National Labor Relations Act,*fn11 the Bituminous Coal Act,*fn12 and the new Employers' Liability Act,*fn13 prefer the more vehement "affect".That the word has the widest conceivable scope is apparent both from its dictionary definition and its judicial interpretation. The dictionary says: "To act upon; produce an effect on; touch",*fn14 and the cases are equally unanimous in emphasizing this inclusive character and so hold it to mean "acting upon", "working a change in" or "concerning".*fn15 In a very recent case the United States Supreme Court divided because of failure of the statute to use the word.*fn16

In this view, percentages and such mathematical formulae are manifestly irrelevant except possibly in one respect. Using the commonly accepted watercourse metaphor, a thimble affects a brook, a bucket affects a stream and a spillway affects a river.As the mathematical formulae have been applied one would be led to believe that regulation in a field of commerce little occupied in the United States is more authorized than that of a quite large business in, let us say, steel. Although this distinction seems logical to us, we must admit that the cases do not stress it.*fn17 However that may be, the point is not involved here because there is no testimony as to the relation between the approximately $150,000 purchases and the amount of lumber shipped across state lines. In the Fainblatt case the United States Supreme Court has expressly held:

"* * * Examining the Act in the light of its purpose and of the circumstances in which it must be applied we can perceive no basis for inferring any intention of Congress to make the operation of the Act depend on any particular volume of commerce affected more than that to which courts would apply the maxim de minimis." N.L.R.B. v. Fainblatt, 306 U.S. 601, 607, 59 S. Ct. 668, 672, 83 L. Ed. 1014.*fn18

De minimis in the law has always been taken to mean trifles - matters of few dollars or less.*fn19 Here, the Suburban's interstate purchases in a year when the retailer lumber business was at its nadir amounted to $150,000. Such a sum surely cannot be considered in the category of de minimis. Even if the maxim were to be applied to the very small lumber dealer, Suburban would be outside the application, for Suburban is the average size of the lumber retailer in its vicinity.*fn20 Certainly no average sized retailer could escape the operation of the Sherman Anti-Trust Act on the ground that the effect of its restraint upon interstate commerce was not substantial. If the Suburban combined with other retailers in the restraint of trade, there can be no question but that Suburban would be liable to prosecution under the Sherman Act. While it is true that the conspiracy or combination would be the element which would render the Suburban criminally or civilly liable, Federal jurisdiction would be conferred solely because Suburban's individual restraint substantially burdened interstate commerce. Assuming the conspiracy, Suburban would be deemed liable because its individual restraint had been magnified by the combination. Similarly, although no conspiracy has been alleged in the case at bar, Suburban's unfair labor practice can cause responses far removed from the original source of agitation and these responses may become more intensified as the ripple proceeds away from the spot in which the disturbance was first manifested.

It seems unnecessary to spend much time on the argument from "direction". The legal periodicals have treated with it convincingly:

"Normally, a stoppage of operations due to labor difficulties in a particular enterprise engaged in production or distribution will not interfere with the movement of goods among the states. It will interfere only if the company affected does a substantial interstate business. Starting with this assumption, the various types of activity which may be held to come within the act fall into three groups.The first group consists of those industries which depend to a large extent upon other states to supply both the raw materials and markets for their products. * * *

"The second group of industries intimately related to commerce comprises those which obtain their products from local sources but sell the bulk of it to extra-state consumers. The best known illustrations of such businesses are mining, lumbering, quarrying, and the production of oil and gas. Attempts to subject these enterprises to regulation under the act have been made, but these attempts have not as yet been passed upon by the Supreme Court. When they are, however, there is strong likelihood that the Court will sustain the action of the Board.

"There are several reasons for this conclusion. In the first place, the Court refused to confine its decision to companies in the current of commerce. By doing so, it could easily have excluded enterprises at either end of the stream. Instead, it adopted a much broader basis to sustain the regulation by holding that 'burdens and obstructions may be due to injurious action springing from other sources.' In addition to this, labor disturbances in industries which merely export goods into other states have been held to ...

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