Armour and Company v. Orville L. Freeman, Secretary of Agriculture

BAZELON, Circuit Judge,

with whom EDGERTON, FAHY and WASHINGTON, Circuit Judges, concur

(dissenting).

The Court’s action today is the latest phase in a controversy over the Secretary of Agriculture’s regulations governing the content and labeling of smoked products moving in interstate commerce. In the period 1952-60, the Secretary’s regulations had required that the weight of smoked cured products, including hams, not exceed the weight of the fresh uncured article. 1 Non-conforming products were required to be labeled Imitation — as are all products not conforming to the Secretary’s regulations. 2 The purpose of the regulations was to prevent *415 the marketing as a genuine ham of a product whose weight had been substantially increased by injecting water and other fluids. It was thought that consumers should not have to pay for water at ham prices.

The regulations were amended in December 1960 to permit cured hams to weigh ten percent more than the fresh, uncured product. 3 Following opposition by some consumer groups, a series of hearings was held after which the Secretary reinstated the prior regulations. As a consequence, hams which weighed more after curing than before were once again required to be labeled “Imitation.’'

Just before the Secretary’s order reinstating the earlier regulations became effective, Armour brought suit attacking their validity and seeking a permanent injunction against their enforcement. Ai’mour also moved for a preliminary injunction pendente lite. The District Court denied the motion, and Armour appealed. We rejected Armour’s application to stay the effective date of the regulations pending appeal. Thereafter the appeal was heard and this Court reversed the District Court in an opinion which, in terms, held that’ the Secretary’s imitation labeling requirement was “arbitrary and capricious on its face.” The validity of that requirement had not been challenged in the complaint below: what had been challenged was the Secretary’s directive that smoked meats moving in interstate commerce be processed to “green” (i. e., uncured) weight.

Before expiration of the period for seeking rehearing, the Secretary requested an extension of time in which to file a petition for rehearing in banc. That request was denied by the Chief Judge after the period for filing a timely petition had expired. The case is now before us on the Secretary’s petition for a rehearing in banc of that denial. I vote to allow the Secretary to file the petition for rehearing of this Court’s decision granting preliminary relief.

In support of its motion for an extension of time, the Government alleges in substance that the Court’s characterization of the regulation as “arbitrary and capricious on its face” and as “forcing packers to violate the statute” is virtually a conclusive adjudication of the merits of the controversy. 4 Because that adjudication has far-reaching implications for the administration and enforcement of the Meat Inspection Act and the Federal Food, Drug, and Cosmetic Act, the Government faced the question whether to seek a rehearing in banc. We understand from the Government’s motion that departmental procedures required consultations among attorneys for the Department of Justice, administrative personnel and attorneys for the Department of Agriculture, and approval by the Solicitor General. Moreover, additional time was required for the preparation of the petition in order to present the merits of the controversy, which were reached in the Court’s opinion but were not the primary focus of the parties on the appeal from the District Court's denial of preliminary relief.

Our records show that a litigant’s first request for a reasonable extension of time to file a petition for rehearing is ordinarily granted as a matter of course. Moreover, there are compelling reasons for granting an extension here.

The injury to Armour is hardly sufficient to warrant our extraordinary haste. The opinion says injury “is apparent without demonstration” because Armour’s good name will be besmirched if it is compelled to market its watered ham': under the label Imitation. The District Court did not agree. Nor do I. *416 Hundreds of packers — including Armour —market products labeled Imitation, and have done so for many years. And Armour is not compelled to market watered hams if it fears the impact of the “Imitation” label. Armour submitted affidavits showing that “there would be no need to use different equipment or to in any sense retool so as to be able to shift production of hams with a finished weight in excess of the fresh, uncured weight to hams weighing no more than the fresh, uncured weight * * Nor is there reason to think that either alternative, use of the Imitation label or elimination of the excess water, would seriously affect Armour’s profits. In prior years, Armour has profitably sold both watered hams labeled Imitation and dried hams complying with the Secretary’s regulations. Moreover, the Government points out that Armour's earnings for the quarter ending January 1962, when the regulations were in effect, were greater than in the year-earlier period when the regulations permitted the marketing of watered hams without the “Imitation” label. 5 In view of these facts, I see no reason to fear significant harm to Armour in the face of an additional fifteen-day delay. And it must be remembered that there is no singling out of Armour. All packers covered by the Act must meet the same standards and compete on the same basis.

I think, moreover, there are strong arguments in support of the Secretary’s authority to issue the challenged regulations. Under the Meat Inspection Act of 1907, 6 the Secretary is empowered to establish standard definitions of meat products. 7 That statute prohibits the offering for sale in interstate commerce of meat or meat food products "under any false or deceptive names; but established trade names or names which are usual to such products * * * which shall be approved by the Secretary of Agriculture are permitted.” 8 In or-

der to implement the statute, the Secretary of Agriculture has long specified the ingredients which may be included in certain products. His power to do so was upheld in Houston v. St. Louis Packing Co., 249 U.S. 479 , 39 S.Ct. 332 , 63 L. Ed. 717 (1919), where a meat packer protested the Secretary’s determination that water or ice must not exceed three percent and cereal two percent of the weight of a product labeled “sausage.” The issue there was whether the Secretary could refuse to stamp a product “inspected and passed” which did not comply with the regulation. The Court held that he could, pursuant to the section of the statute to which we have just referred. Indeed, the Court said:

“Whether or not the term ‘sausage,’ when applied to the product of the appellee, in which more than the permitted amount of cereal and water is used, is false and deceptive is a question of fact, the determination of which is committed to the decision of the Secretary of Agriculture by the authority given him to make rules and regulations.for giving effect to the act, and the law is that the conclusion of the head of an executive department on such a question will not be reviewed by the courts where it is fairly arrived at with substantial evidence to support it.” [ 249 U.S. at 484 , 39 S.Ct. at 334 .]

It would appear that the regulation specifying the water which may be added to a product labeled “ham” may be valid under the authority of the Houston case. See also Brougham v. Blanton Mfg. Co., 249 U.S. 495 , 39 S.Ct. 363 , 63 L.Ed. 725 (1919).

There is also authority for the Secretary’s use of the word “imitation” to describe a product which does not conform to the standards he has established — although this Court’s opinion seems to say that such usage is itself misbranding. *417 In 62 Cases, etc., of Jam v. United States, 340 U.S. 593 , 71 S.Ct. 515 , 95 L.Ed. 566 (1951), the Supreme Court held that jam which contained insufficient fruit ingredients to comply with the Secretary’s standards was not misbranded if it were labeled “Delicious Brand Imitation Jam.” Speaking of the use of the word "imitation,” the Court wrote:

“ * * * nothing can be legally ‘jam’ after the Administrator promulgated his regulation in 1940, 5 Fed.Reg. 3554, 21 C.F.R. § 29.0 , unless it contains the specified ingredients in prescribed proportion. Hence the product in controversy is not ‘jam.’ It cannot lawfully be labeled ‘jam’ and introduced into interstate commerce, for to do so would ‘represent’ as a standardized food a product which does not meet prescribed specifications.

******

“ * * * the name ‘imitation jam’ at once connotes precisely what the product is: a different, an inferior preserve, not meeting the defined specifications. * * * A product so labeled [as imitation] is described with precise accuracy. It neither conveys any ambiguity nor emanates any untrue innuendo, as was the case with ‘Bred Spred’ considered by Congress in its deliberation on § 403(g). See H.R.Rep.No. 2139, 75th Cong., 3d Sess. 5; House Hearings on H.R. 6906, 8805, 8941 and S. 5, 74th Cong., 1st Sess. 46-47. It purports and is represented to be only what it is — an imitation. It does not purport nor represent to be what it is not—the Administrator’s genuine ‘jam.’ ” [ 340 U.S. at 599-600 , 71 S.Ct. at 519-520 .]

In the period 1952-60, moreover, the Secretary required watered hams to be labeled Imitation without provoking protest from the industry that his action was arbitrary and capricious. The IMitation label requirement which this Court has struck down has been in force since 1941. Finally, when this suit was instituted, approximately 1,300 labels bearing the legend “Imitation” were on file with the Department of Agriculture and were being used by several hundred packers (including Armour) to identify a host of products (e. g., bologna, chicken, frankfurters, chicken loaf, sausage, salami, and, of course, ham) solely because they did not conform to the Secretary’s standards.

The Secretary contends that in deciding the issue of preliminary relief, this Court’s opinion effectively disposed of the final issues in the case. He finds this in the Court’s statement that:

“The Secretary’s amendatory regulation which is under attack, is capricious and arbitrary on its face in requiring a packer to label a genuine ham as Imitation Ham, thus forcing him into violating the statute which forbids misbranding; and nothing in the record as presently constituted supports or justifies such an enforced distortion of the truth. * * * he chose to require the false and deceptive Imitation Ham label.” [page 405.]

This calls to mind the dissenting opinion of Judge Amidon of the Court of Appeals for the Eighth Circuit in St. Louis Independent Packing Co. v. Houston, 242 F. 337, 346 (1917):

"This case has followed an unusual course, and has led to unfortunate results. When it was here on appeal from the order denying the preliminary injunction, this court, without any judicial investigation of the facts, decided that the name ‘sausage’ could be deprived of its false and deceptive character, when applied to plaintiff’s product, by the use of qualifying words, and ordered the temporary injunction to issue. 9 The case then went back to *418 be tried in the lower court upon the merits, but this court had already precluded such an investigation. Our decision was held to be binding upon the trial court that the name was not false and deceptive, and that court was shut up to an investigation of whether plaintiff's product was unwholesome. The result is that the question whether the name is false and deceptive, as used in the channels of trade, is finally decided by this court against the decision of the Department solely on bill and answer, and without any investigation of the question. Fortunately, if this case shall be taken to a higher court for review, our decision on the appeal from the order denying a temporary injunction will be open for re-examination.”

The dissent was vindicated by the Supreme Court. Houston v. St. Louis Packing Co., 249 U.S. 479 , 39 S.Ct. 332 (1919), reversing 242 F. 337 (8th Cir. 1917).

Not only does the Government argue that the Court's opinion in this case is too broad, but further that it is otherwise wrong. The question on appeal from the denial of a temporary injunction is whether the District Court abused its discretion. See Yakus v. United States, 321 U.S. 414, 440 , 64 S.Ct. 660 , 88 L.Ed. 834 (1944). In reviewing the exercise of that discretion, we have said that four factors are to be considered: (1) whether the movant would suffer irreparable injury if a preliminary injunction were denied; (2) the likelihood that the Aiovant will prevail on the merits; (3) the effect of granting or denying the motion on the public interest; (4) the effect óf grant or denial upon other interested persons. Virginia Pet. Jobbers’ Ass’n v. Federal Power Comm., 104 U.S.App.D.C. 106 , 259 F.2d 921 (1958). There is strong reason to believe that the District Court correctly resolved these factors in denying preliminary relief. Accordingly, I would allow the Government to file its petition for rehearing in banc. And only after Armour has had an opportunity to reply would I decide whether a rehearing in banc is warranted.

. 17 Fed.Reg. 4845 (1952) ; 18 Fed.Reg. 7536 (1953).

. 6 Fed.Reg. 1142 (1941), 9 C.F.R. § 17.8 (b).

. 25 Fed.Reg. 13952 (1960).

. In Young v. Motion Picture Ass’n, 112 U.S.App.D.C. -, 299 F.2d 119 (1962), this Court recognized:

“ * * * the general rule that a de* nial of a preliminary injunction will not be set aside on appeal unless the District Court’s action constitutes clear error or abuse of discretion, and that ordinarily this court will not consider the merits of the case further than necessary to determine whether that discretion was abused." [Emphasis supplied. J

. The Wall Street Journal, Feb. 19, 1962, p. 17.

. 34 Stat. 1260 (1907), as amended, 21 U.S.C.A. § 71 (1958).

. Houston v. St. Louis Packing Co., 249 U.S. 479 , 39 S.Ct. 332 , 63 L.Ed. 717 (1919).

. 34 Stat. 1262 (1907), 21 U.S.C.A. § 75 .

. In our case, the Court wrote: “The Secretary could easily have made this litigation unnecessary by merely requiring that labels on moist hams bear a legend showing the nature and extent of the added moisture.” [Slip opinion, pp. 3—4.]