Petition — Wallace v. Rath Packing Co.

_—Supreme Court of the United’ States”

October |

No.

oo lg in 2

L.. T. WALLACE as Director

State of California and

bool and Agriculture of the

Director of the

County of Loos Arun I ,

and Measures,

Department of

Petitioners,

THE RATE PACKING COMPANY, © corporation,

Respondent.

Petition for a Writ of Certiorari to the United States

Court of Appeals for the Ninth Circuit

VELL

YOUNGER

Attorney General of California,

CARL, BORONKAY,

Assistant Attorney General,

HERSCHEL!

ALLAN J

GOODMAN,

Deputy Attorneys General,

3580 Wilshire Boulevard

Los Angeles, Cali

(213) 620-3864,

Counsel for Petitioner I

JOHN LARSON,

County Counsel,

Los Angeles County

California,

ARNOLD Ko GRAHAM,

Deputy County Counsel

648 Hall of

Los Angeles, Calif

(213) 974-1868,

Counsel for Peutioner M. HL. Becker

\dministration,

Parker & Son, Inc., Law Printers, Los Angeles.

Phone 724-6622

SUBJECT INDEX

Petition for a Writ of Certiorari to the United States

Court of Appeals for the Ninth Circuit ............

EST TA PI AS APE AR LoL

ge EE 2

Questions Presented ...........ccccceccceseseseecscsceseseeeeeeseees

Constitutional and Statutory Provisions Involved ....

Statement Pursuant to Rule 33(2)(b) .......0.0.0...

I a creerecscteineniniaieimmsonnden

Reasons for Granting the Writ ...................cccccccee

1. The Decision of the Court of Appeals De-

prives California of Its Sovereign Authority

to Protect the Health and Welfare of Its

Citizens, Conflicts With the Principles Enun-

ciated in Prior Decisions of This Court, and

Is Contrary to Principles Affirmed by the

Second Circuit in General Mills, Inc. v.

STAN ar A SE

A. The Decision Below Deprives California

of Its Sovereign Police Power ..............

B. The Court Below Erred in Finding

(1) an Intent by Congress to Preempt

State Standards and (2) That Cali-

fornia Had Exceeded the Scope of Its

“Concurrent Jurisdiction” to Enforce

the Wholesome Meat Act ....................

C. The Decision Below Is Contrary to

Principles Affirmed by the Second

Circuit in General Mills, Inc. v. Furness

ii,

Page

D. The Decision Below Will Have a Deci-

sive, Adverse Impact Upon Consumers

and Competitors and Upon Federal-

NET DETTE catesitislerdiniinsidininandiiabsimonsiee

2. In Reversing the Trial Court's Finding That

9 C.F.R. Section 317.2(h)(2) Was Void for.

Vagueness, the Court of Appeals Has so

Far Departed From the Usual Course of

Judicial Proceedings as to Call for an Exer-

cise of This Court's Power of Supervision

ofl lf

3. The Holding of the Courts Below That

There Is Feaeral Jurisdiction Raises Signifi-

cant and Recurring Problems Concerning the

Jurisdiction of Federal Courts and Is in

Conflict With Prior Rulings of This Court

4. In Affirming the Trial Court’s Issuance of

an Injunction in the Face of Substantial

Evidence of Rath’s Unclean Hands, the

Court Beiow Has Sanctioned a Departure

From the Accepted Course of Judicial

Proceedings and Disregard for Prior De-

cisions of This Court, as to Call for an Ex-

ercise of This Court’s Power of Supervision

15

16

20

INDEX TO APPENDICES

Page

"Appendix A. Opinion of the United States Court

.

of Appeals for the Ninth Circuit ............ App. p. 1

Appendix B. Constitutional and Statutory Pro-

visions Involved .............. iandinteneumannentamanaianintets 59

Appendix C. Relevant Portions of the Record

SEED . Waesnsicctieetbidiadetnctitbaisipiiaitvedinntstadintatnimenitain 74

Testimony of V. L. Hutchings, U.S.D.A. Re-

gional Compliance Officer (Reporter's Tran-

ME a ee 74

Testimony of Norman L. Mettert, Los Angeles

County Department of Weights and Meas-

ures (Reporter's Transcript, pp. 335-339) .... 88

Testimony of Chester A. Jaensen, Rath Packing

Company (Reporter's Transcript, pp. 122-

efi 2A Oe RE Sb 92

Appendix D. Title 4 California Administrative

Code, Ch. 8, Subch. 2, Art. 5, §2930 et seq. ...... 97

iv.

TABLE OF AUTHORITIES CITED

Cases Page

Armour v. Ball (6th Cir. 1972) 468 F. 2d 76, cert.

2 a) & seine eee 10, 13

Chandler v. O'Bryan, 445 F. 2d 1045 (10th Cir.

FOGED. . .cciciwcintivenincstnitatnaataniine wantin ilaeieatiaiiabt 21

Flood v. Kuhn, 407 U.S. 253 (1972) ......--cccceeeeseees 19

Florida Lime and Avocado Growers v. Paul, 373

tS) 7 | ee 9, 10

General Mills, Inc., et al. v. Furness, 398 Fed. Supp.

151 (S.D. N.Y. 1974), affd. 508 F. 2d 536 ......

eT ae a a 4, 14, 15

Hicks v. Miranda, 423 U.S. 332 (1975) ...... 23, 24

Hines v. Davidowitz, 312 U.S. 52 (1941) ........... il

Missouri-Pacific Ry. Co. v. Fitzgerald, 160 U.S. 556

| aE 20, 21

Patapsco Guano Co. v. North Carolina, 171 U.S.

SEG CAGE GD ccteeveesungsiviwietinadienae 9, 10

Perez v. Campbell, 402 U.S. 637 (1970) ............ 11

Precision Instrument Mfg. Co. v. Automotive Main-

tenance Mach. Co., 324 U.S. 806 (1945) ........ 24

Public Service Commission v. Wycoff, 344 U.S. 237

{ eee we 20, 21, 22, 23

Public Utilities Commission of California v. United

Sresen, SSS UT SOG CIGD cccccseccssccecnsscccetnses 23

Red Lion Broadcasting Co. v. F.T.C., 395 U.S. 367

Co ee ~essstedsitceaminalandidiinaaaa 19

Samuels v. Mackell, 401 U.S. 66 (1970) .......... 24

Savage v. Jones, 225 U.S. 501 (1911) ...00.. 16

Skelly Oil Co. v. Phillips Co., 339 U.S. 667 (1950)

Page

United States v. Shreveport Grain & E Co., 287 U.S.

EE 19

Younger v. Harris, 401 U.S. 37 (1970) ....23, 24

Rules

Rules of the Supreme Court of the United States,

ES 5

Statutes

California Administrative Code, Title 4, Art. 5,

EEE 5, 6, 10, 12

California Administrative Code, Title 4, Ch. 8,

i ee 1 i, 2D... ....ssssssssssssscsoves 4, 8

California Business and Professions Code, Sec.

EE SE 4, 5, 8, 10, 12

California Business and Professions Code, Sec.

i. csesmenvennnonee 6

California Civil Code, Sec. 3369 ....000000000ccc.. 6

Code of Federal Regulations, Title 9, Sec. 317.2

SSE 4, 8, 11, 12, 16

Fair Packaging and Labeling Act, 80 Stat. 1296, 15

EE 14

Food, Drug and Cosmetic Act, 52 Stat. 1040, 21

EE EET 14

31 Statutes at Large, p. 1449, 15 U.S.C. §272(d)

United States Code, Title 21, Sec. 601(n)(5) ..11, 16

United States Code, Title 21, Sec. 602 ......000....... 11

United States Code, Title 21, Sec. 607(b)

vi.

United States Code, Title 21, Sec

United States Code, Title 28, Sec.

United States Code, Title 28, Sec. vs ¢ ) eee 3

United States Code, Title 28, Sec. a 5

United States Code, Title 28, Sec

Sec

United States Code, Title 28, 2. pease 5

Wholesome Meat Act, 81 Stat. 584, 21 U.S.C.

DFU scbdeinnsintiincanntiiiaieiae ee ere | 4, 5

IN THE

~ Supreme Court of the United States

October Term, 1975

i a

L. T. WALLACE as Directér of Food and Agriculture.of the

State of California and M. H. BECKER as Director of the

County of Los Angeles, California, Department of Weights

and Measures,

Petitioners,

vs.

THE RATH PACKING COMPANY, a corporation,

Respondent.

Petition for a Writ of Certiorari to the United States

Court of Appeals for the Ninth Circuit

Petitioners L. T. Wallace as Director of Food and

Agriculture of the State of California,’ and M. H.

Becker as Director of the County of Los Angeles,

California, Department of Weights and Measures, pray

that a writ of certiorari issue to review the opinion

and judgment of the United States Court of Appeals

for the Ninth Circuit entered in this proceeding on

October 29, 1975.

The States, organizations, and law enforcement of-

ficers listed in footnote 2 have authorized petitioners

1Dr. Wallace was appointed to succeed C. B. Christensen

as Director during the pendency of this matter in the Court

of Appeals.

_

to advise the Court that they support the grantin

of certiorari.’ \

2The following jurisdictions and organizations support the

granting of certiorari in this case.

States:

Bruce E. Babbitt, Attorney General of Arizona; Carl R.

oe, Atto General of Connecticut; the State of

John Farias, Jr., as Chairman of the Board of

Agriculture, George Mattimoe, Deputy Director; the State

of Department of Justice, William J. Guste, Jr

a fag? the Commonwealth of

rancis X. otti, Attorney General; Robert Woodahl,

Attorney General of Montana; Pau! L. Douglas, ttorney

General of Nebraska; Robert List, Attorney General of

Nevada; Louis J. Lefkowitz, Attorney General of New York;

the State of Oregon; the Commonwealth of P.

Department of Agriculture, Raymond J. Kerstettler,

Secretary; William J. Janklow, Attorney General of

Dakota; Washington State ment of Agricul

Slade Gordon, Attorney General. ¥ oY

Associated Dairymen; Associated Milk Producers, Inc.; Cali-

fornia Cattlemen’s Association; California Citizen Action

Group; California Farm Bureau Federation; Consolidated

Milk Producers for San Francisco; Consolidated Milk Pro-

ducers of Tulare County; Consumers Cooperative of Berke-

ley, Inc.; Federated Dairymen; Mid-America Dairymen, Inc.;

League of California Milk Producers; Milk Producers Coun-

cil; National Association of Retail Grocers of the U.S.

Inc.; National Consumers Congress; Producers’ Market Milk

Association; Scale Manufacturers Association, Inc.; Western

Dairymen’s Association.

Other California Law Enforcement Officers:

D. Lowell Jensen, District Attorney, Alameda County;

Thomas L. Kelly, District Attorney, Alpine County; Gu

E. Reynolds, District Attorney, Amador County; Kenneth

H. Leach, District Attorney, Butte County; Joseph W.

Kiley, District Attorney, Calaveras County; Robert W. Weir,

District Attorney, Del Norte; Terrence M. Finney, District

Attorney, El Dorado County; Noble Sprunger, County

Counsel, El Dorado County; William A. Smith, District

_Attorney, Fresno County; L. H. Gibbons, District Attorney,

Inyo County; Ralph B. Jordan, County Counsel, Kern

County; Albert M. Leddy, District Attorney, Kern County;

Harold L. Abbott, District Attorney, Lassen County; John

K. Van de Kamp, District Attorney, Los Angeles County;

Bruce Bales, District Attorney, Marin County; Douglas J.

Maloney, County Counsel, Marin County; Duncan M.

=— oe

Opinion Below

The opinion of the Court of Appeals, not. yet reported,

"appears at Appendix A, infra, pp. 1-47. The opinion

of the District Court for the Central District of Cali-

fornia is reported at 357 Fed. Supp. 529, and appears

at Appendix A, infra, pp. 47-58.

Jurisdiction

The judgment of the Court of Appeals for .he Ninth

Circuit was entered on October 29, 1975. See Appendix

A, infra, p. 1. This petition for a writ of certiorari

was filed within 90 days of that date. This Court’s

jurisdiction is invoked pursuant to 28 U.S.C. section

1254(1).

James, District Attorney, Mendocino County; Russell M.

Koch, County Counsel, Merced County; John P. Baker,

District Attorney, Modoc County; James D. Boitano, District

Attorney, Napa County; Ronald L. MacMiller, District

Attorney, Nevada County; Cecil Hicks, District Attorney,

Orange County; Gerald E. Flanagan, District Attorney,

Plumas County; Byron C. Morton, District Attorney, River-

side County; John M. Price, District Attorney, Sacramento

County; Edwin L. Miller, Jr., District Attorney, San

Diego County; Joseph Freitas, District Attorney, City

and County of San Francisco; Joseph H. Baker, Dis-

trict Attorney, San Joaquin County; Robert N. Tait,

District Attorney, San Luis Obispo County; Keith C.

Sorensen, District Attorney, San Mateo County; James

M. Cramer, District Attorney, San Bernardino County;

Stanley M. Roden, District Attorney, Santa Barbara County;

Louis P. Bergna, District Attorney, Santa Clara County;

Christopher C. Cottle, District Attorney, Santa Cruz County;

Shasta County, Robert A. Rehberg, County Counsel; Robert

W. Baker, District Attorney, Shasta County; Gene L. Tun-

ney, District Attorney, Sonoma County; Donald N. Stahl,

District Attorney, Stanislaus County; Edward F. Buckner,

County Counsel, Sutter County; H. Ted Hansen, District

Attorney, Sutter County; Henry J. Goff, Jr., District Attor-

ney, Tehama County; Calvin E. Baldwin, County Counsel,

Tulare County; J. W. Powell, District Attorney, Tulare

County; a Dietrich Jr., County Counsel, Tuolumne

County; C. Stanley Trom, District Attorney, Ventura Coun-

ty; Bartley C. Williams, District Attorney, Yuba County.

—_ vn

Questions Presented

1. Whether the Court of Appeals erred in holding

that California may rot exercise its police power to

assure the California public and competitors that pack-

aged meat products bear accurate statements of weight,

which holding is contrary to principles affirmed by

the Second Circuit in General Mills, Inc. v. Furness,

508 F. 2d 836 (i975).

2. Whether the Court of Appeals erred in reversing

the District Court’s determination that a United States

Department of Agriculture regulation wh.ch purports,

without specifying any limits, to permit “reasonable

variations” from label statements of weight on packaged

meat products was void for vagueness.

3. Whether the Court of Appeals erred in holding

that the District Court had jurisdiction to review Rath’s

defenses to prior-filed state court actions after the

District Court had remanded the state court actions.

4. Whether the Court of Appeals erred in affirming

issuance of an injunction requested by respondent when

there was substantial evidence of Rath’s violations of

law and unclean hands.

Constitutional and Statutory Provisions Involved

The case involves Article VI, clause 2 of, and Amend-

ment X to, the United States Constitution; the Whole-

some Meat Act, 81 Stat. 584 et seg., 21 U.S.C.

section 601 et seq.; 9 Code of Federal Regulations

section 317.2(h)(2); and California Business and Pro-

fessions Code section 12211; California Stats. 1963,

ch. 353; which are reprinted in pertinent part in Appen-

dix B, infra, pp. 59-69, and Title 4, Calif. Admin. Code,

ch. 8, subch. 2, Art. 5, section 2930 et seqg., which is

set out as Appendix D, infra, pp. 97-113.

—5—

Statement Pursuant to Rule 33(2) (b)

Since this proceeding draws into question the constitu-

‘tionality of the Act of March 4, 1907, as amended

81 Stat. 584, 2i U.S.C. sections 601 ef seqg., an Act

of Congress affecting the public interest, and neither

the United States nor any agency, officer or employee

thereof is a party, it is noted that 28 U.S.C. section

2403 may be applicable. |

No court of the United States as defined by 28

U.S.C. section 451 has, pursuant to 28 U.S.C. section

2403, certified to the Attorney General the fact that

the constitutionality of such Act of Congress has been

drawn in question.

Statement of the Case

In the trial court respondent claimed that jurisdiction

was conferred by 28 U.S.C. section 1331(a)~as it

alleged that a case or controversy arising under the

laws of the United States involving niore than $10,000

was presented. For reasons set out infra, petitioners

contest the assumption of jurisdiction by the trial court.

To assure California consumers, wholesalers and re-

tailers that the packages they purchase contain the

quantity stated on the label, and to protect markets

for producers, petitioners and their predecessors, Cali-

fornia weights and measures officials, have, pursuant

to state law (Cal. Bus. & Prof. Code § 12211 and

4 Cal. Admin. Code § 2930 et seq. (Article 5))

and for more than 15 years, inspected products of

all manufacturers and packers, applying the same ac-

curate-weight-on-the-average standard regardless of the

origin of the commodity inspected.

In the course of enforcing these truth-in-packaging

laws during the period April 1971 through March

1972, petitioner Becker inspected lots of bacon pack-

aged by respondent The Rath Packing Company (Rath)

when offered for retail sale. These packages carry

a representation by Rath of the weight of the contents

(e.g., Net Weight 16 oz. (1 Ib.)). After determining

that lots of Rath bacon bore false statements of weight,

petitioner Becker ordered them off sale.’ More than

100 lots of Rath bacon were ordered off sale. Con-

ferences were had with Rath representatives at which

they were advised that Rath must deliver to the pur-

chasers the net weight represented on the package.

As a result of Rath’s failure to meet this standard,

on February 17, 1972, the Riverside County, California,

District Attorney filed a civil action against Rath in

Riverside County Superior Court, for violation of Cali-

fornia false advertising and unfair competition statutes.

On March 1, 1972, the Los Angeles County, California,

District Attorney filed a similar action in Los Angeles

County Superior Court.‘ Rath removed each of these

cases to United States District Court and filed answers

and counter-claims in that court.

‘Both the District Court and the Court of Appeals acknowl-

edged the statistical validity of the California testing procedure

(Article 5), Appendix A, infra, at 8 and 52. Utilizing Article 5

there is but one chance in one thousand that the determination

that a lot is short weight is not correct.

‘The texts of the statutes upon which these complaints are

based (Cal. Bus. & Prof. Code § 17500 and Cal. Civ. Code

§ 3369) are set out in Appendix B, infra, pp. 69-71.

= =

Each California Superior Court action alleged that

statements of weight placed by Rath upon its packaged

‘bacon were untrue as in fact packages were short

weight when inspected at the retail level. In its answers

filed in the removal proceedings, Rath asserted as

a defense to the California Superior Court actions,

federal preemption. By counterclaim, Rath sought dec-

laratory and injunctive relief alleging preemption of

California’s weights and measures laws by the federal

Wholesome Meat Act.

On March 20, 1972, the District Court entered

orders remanding each action to its original California

court, finding at least with respect to the Riverside

action that there was no diversity of citizenship and

“(n]o substantial federal question is presented on the

face of the pleadings.”

Meanwhile, on March 17, 1972, Rath filed the action

in the District Court which petitioners now seek to

have this court review.

In each new District Court action, Rath complained

for declaratory and injunctive relief based upon allega-

tions that certain state statutes were preempted by

the Wholesome Meat Act. Rath’s District Court com-

plaints raised identical issues to those set out in its

answers and counterclaim filed upon removal of the

state court actions and to those made in its answers

and cross-complaints in the state court complaints. The

state statutes which Rath challenged by its action in

District Court are the very ones under which the Los

Angeles and Riverside County District Attorneys had

brought suit against Rath.

On November 27, 1972, the District Court denied

Christensen and Becker’s motion to dismiss the action

below for want of jurisdiction. Petitioners then sought

review of this decision in the Ninth Circuit. The Court

of Appeals declined to disturb the District Court’s

assumption of jurisdiction.

On April 3, 1973, the trial court entered its Memo-

randum Opinion and Order (Appendix A, infra, pp.

48-57). That decision held, in part, that California Busi-

ness and Professions Code section 12211 and Title

4, California Administrative Code, chapter 8, subdivi-

sion 2, Article 5, are preempted by federal law, and

enjoined their enforcement. The District Court also

held that 9 C.F.R. section 317.2(h)(2) was void

for vagueness.

The Court of Appeals affirmed the preemption hold-

ing and reinstated the federal regulation.

~~ =

REASONS FOR GRANTING THE WRIT

1. The Decision of the Court of Appeals Deprives

California of Its Sovereign Authority to Protect

the Health and Welfare of Its Citizens, Conflicts

With the Principles Enunciated in Prior Decisions

of This Court, and Is Contrary to Principles Af-

firmed by the Second Circuit in General Mills,

Inc, v. Furness

A. The Decision Below Deprives California of Its Sovereign

Police Power

As this court said almost 80 years ago:

“Where the subject is of wide importance to

the community, the consequences of fraudulent

practices generally injurious, and the suppression of

such frauds matter of public concern, it is within

the protective power of the State to intervene.

Laws providing for the inspection and grading

of flour, the inspection and regulation of weights

and measures, the weighing of coal on public

scales, and the like, are all competent exercises

of that power. . . .” Patapsco Guano Co, v.

North Carolina, 171 U.S. 345, 358 (1897).

And as more recently stated in Florida Lime and

Avocado Growers v. Paul, 373 U.S. 132, 144 (1962):

“(T]he supervision of the readying of foodstuffs

for market has always been deemed a matter

of peculiarly local concern. . . . [T]he States

have always possessed a legitimate interest in

the protection of . . . [their] people against

fraud and deception in the sale of food products

at retail markets within their borders.”

In the face of this Court’s repeated affirmation

of the right of the States to assure their citizens

antifiees

of truth and wholesomeness in the marketplace, the

Court below held that California laws, designed to

prevent fraud in the marketplace by requiring that

label weight statements be accurate when the product

is purchased (Cal. Bus. & Prof. Code § 12211 and

Article 5), offend Article VI, section 2, the supremacy

clause, of our federal Constitution when viewed against

21 U.S.C. section 678. See Armour v. Ball (6th Cir.

1972) 468 F. 2d 76; cert. den. 411 U.S. 981.

However, no article or clause of our federal Consti-

tution relinquishes the police power of the States.

And the Tenth Amendment specifically reserves to

the States all powers not delegated to the United

States by the Constitution, nor prohibited by it to

the States.

Thus, in order for the Court below to conclude

that California laws were preempted by section 678

of the Wholesome Meat Act, it must necessarily have

concluded that the States had, by Constitution, yielded

the necessary authority to the federal government.

Yet, nowhere in ovr Constitution is this power

expressly or impliedly relinquished, and in light of

Patapsco Guano, supra, and Florida Lime and Avocado

Growers, supra, petitioners urge that this Court has

specifically affirmed the police power of the States

in this field and that the Court below erred.

B. The Court Below Erred in Finding (1) an Intent by Con-

gress to Preempt State Standards and (2) That California

Had Exceeded the Scope of Its “Concurrent Jurisdiction”

to Enforce the Wholesome Meat Act

Assuming, arguendo, that Congress may restrict the

authority of the states in this field, petitioners contend

the circuit court erred in holding that the California

standard of true weight on the average at retail is

- preempted by the federal standard.

Deciding whether a state statute is in conflict with

a federal statute and invalid under the Supremacy

Clause is a two-step process of first ascertaining the

construction of the two statutes and then determining

the constitutional question of whether they are in

conflict. Perez v. Campbell, 402 U.S. 637, 644 (1970).

Preemption is found only where there is a direct

and positive conflict between the state and federal

objectives—where the challenged state law “stands as

an obstacle to the accomplishment and execution of

the full purposes and objectives of Congress.” Hines

vy. Davidowitz, 312 U.S. 52, 67 (1941); Perez v.

Campbell, supra, at 651-52.

The purpose of the Wholesome Meat Act is to

protect consumers and competitors from misbranded

and adulterated meat products. (21 U.S.C. § 602.)

Under this Act a packaged meat product is misbranded

unless it bears “an accurate statement of the quantity

of contents . . . Provided, That . . . reasonable

variations may be permitted . . . by regulations pre-

scribed by the Secretary [of Agriculture].” (21 U.S.C.

§ 601(n)(5).) Pursuant to this authority the Secretary

has adopted 9 C.F.R. 317.2(h)(2).°

R. 317.2(h)(2) provides:

bh ayhinn ny « is shown on a label shall not be

false or misleading and shall express an accurate statement

of the quantity of contents of the container exclusive

of wrappers and packing substances. Reasonable variations

caused by loss or gain of moisture during the course

of good distribution practices or by unavoidable deviations

in good manufacturing practice will be recognized. Varia-

tions from stated quantity of contents shall not be unrea-

sonably large.”

aniiftius

California Business and Professions Code section

1221 1," which the lower federal courts held to be

preempted by the Wholesome Meat Act, requires that

each “sealer” (weights and measures official) weigh

packages “in order to determine whether [they] contain

the quantity or amount represented . . .” and permits

the Director of Food and Agriculture to adopt regu-

lations for the accomplishment of this objective provided

that the average weight or measure of the packages . . .

in a lot . . . sampled shall not be less . . . than

the net weight or measure stated upon the package. . . .”

The Director adopted such a uniform testing procedure

(4 Cal. Admin. Code § 2930 et seq.) which both

the District and Circuit Courts recognized to be statisti-

cally valid (Appendix A, infra, at p. 8 and p. 52),

but criticized for not recognizing only the causes of

variations described in 9 C.F.R. 317.2(h)(2).

Petitioners contend that the court below erred in

its determination of the existence of a conflict between

state and federal laws and in its assessment of the

extent of that conflict. First, the purpose and effect

of the invalidated California law are to require and

enforce true weight on-the-average at retail. This stand-

ard is fully in accord with the intent of the Wholesome

Meat Act. (As the courts below acknowledged Article

5, the California testing procedure, is a statistically

sound means of determining the true weight of any

lot of product. )

Second, use of the true-weight-on-the-average stand-

ard and of numerical limits on the reasonableness

of variations are specifically authorized by the Secretary

*The full text of this statute i i "

infra, pp. 68-69. ute is set out in Appendix B,

ee ete -

—

of Commerce, National Bureau of Standards (United

States Department of Commerce, National Bureau of

- Standards, Checking Prepackaged Commodities, 1959).

Third, federal agencies have adopted the accuracy-

on-the-average interpretation used by California but re-

jected by the court below. The United States Department

of Agriculture and Environmental Protection Adminis-

tration each has interpreted statutes which require

that label statements of weight be accurate, but which

allow adoption of regulations which permit reasonable

variations to require accurate weight on the average.

(Appendix B, infra, at pp. 71-73.)

Thus the court below erred (1) in finding the weight

standard enforced in California to be in conflict with

that established by the Wholesome Meat Act, and (2)

in concluding that California’s laws are preempted."

Even assuming, arguendo, that there is a conflict

between state and federal standards, there are no facts

justifying the conclusion that the state system stands

in opposition to the federal—a necessary precondition

to a finding of preemption. Not only is there no

direct and positive conflict between the objectives of

the state and federal laws, but it is only through

enforcement of the state laws that the purposes of

the federal law is being carried out. V. L. Hutchings,

officer in charge of the USDA Western Region Compli-

ance Staff, testified at trial that (1) he has seven

TArmour v. Ball, supra, is ee as there the ingredient

standard sought to be imposed by Michigan was, arguendo,

materially different from the standard promulgated by the Secre-

tary of Agriculture. By contrast, in the instant case the Cali-

fornia standard is in accord with principles established by the

National Rureau of Standards and similar to the former USDA

(now EPA) regulation which was adopted pursuant to a statute

which imposes a standard identical to that in issue.

onlin

compliance officers for the 12 western states (including

Alaska and Hawaii), (2) these officers do not them-

selves have the training or equipment to make the

necessary retail level inspections, and (3) USDA must

therefore rely upon States and state procedures to

determine whether product is short weight. And while

there is not one reported case of USDA enforcement

of truth of packaging standards under the Wholesome

Meat Act, in 1975 alone Los Angeles County brought

363 court cases. It should be clear from this evidence

that it is only by means of the enforcement action

of California weights and measures officials that the

Federal statutory standard of true weight at retail

is enforced.

Cc, The Decision Below Is Contrary to Principles Affirmed by

the Second Circuit in General Milis, Inc. v. Furness

In General Mills, Inc., et al. v. Furness, 398 Fed.

Supp. 151 (S.D. N.Y. 1974), affd. 508 F. 2d 536,

the court rejected plaintiff’s contention of preemption

of a New York City ordinance regulating the weight

of prepackaged commodities which was found to be

substantially more stringent than applicable federal

standards (under the Food, Drug and Cusmetic Act

52 Stat. 1040, 21 U.S.C. § 301 et seg. and Fair Packag-

ing and Labeling Act, 80 Stat. 1296, 15 U.S.C. 1451

et seq.)

Taking particular note of the defendant’s interest

in regulating weights and measures, the court affirmed

the City of New York’s power to regulate in this

field even though one consequence might be to require

out of state packagers to alter their practices to conform

to the local standards which are applied equally to all.

x =

Petitioners contend that the principle of General

Mills v. Furness, reaffirming the power of state and

- local agencies in non-discriminatory regulation of weights

and measures, is applicable in the instant case and that

the court below erred in voiding California’s non-

discriminatory enforcement procedure.

D. The Decision Below Will Have a Decisive, Adverse Impact

Upon Consumers and Competitors and Upon Federal-State

Relations

The decision below voids state laws designed to

(1) enable consumers to rely upon the truth of repre-

sentations made to them in the marketplace, (2) assure

that all competitors must meet the same, beneficial

standards. To all the States the consequences of the

ruling below are severe. If the ruling below is permitted

to stand, the States will be unable to prevent the sale

of foodstuffs which are falsely labeled or adulterated.

The present state laws which require a uniform

standard of accuracy are important to: (1) consumers

who must rely on package labels showing net weight

or net quantity in comparing values among competing

products, (2) retailers who not only sell packaged

goods in competition with other retailers, but who

are also large purchasers of packaged products which

they then repackage into smaller products, for example

meat cuts and cheeses, (3) restaurant operators, schools

and other institutions that buy large quantities of pack-

aged foods, (4) federal agencies such as the Department

of Defense and the Veteran’s Administration that buy

large quantities of packaged foods, (5) packagers of

food and other consumer products who are in competi-

tion with domestic and foreign packagers, (6) farmers

—

who sell to packagers, since shortages in packages

can mean less total product purchased, and (7) manu-

facturers and servicers of packaging, weighing and

measuring equipment since packagers who are permitted

shoriages depending upon the type of equipment used

are induced to use poor rather than modern, accurate

equipment.

Petitioners contend that no constitutional principle

permits the result reached by the circuit court. As

Justice Charles Evans Hughes said in Savage v. Jones,

225 U.S. 501, 528 (1911):

“.. . the Constitution of the United States does

not secure to anyone the privilege of defrauding

the public.”

The conflict of the ruling below with the sovereign

authority of the States to prevent fraud in the market-

place and with principles of prior decisions of this

Court justify the granting of certiorari.

2. In Reversing the Trial Court’s Finding That 9

C.F.R. Section 317.2(h)(2) Was Void for Vague-

ness, the Court of Appeals Has so Far Departed

From the Usual Course of Judicial Proceedings

as to Call for an Exercise of This Court’s Power of

Supervision Over Federal Courts

When read together with 9 C.F.R. section 317.2(h)

(2), 21 U.S.C. section 601(n)(5) defines a packaged

meat product to be misbranded if it is “unreasonably”

short weight.

While the Court of Appeals recognized the public

importance of the question of the validity of 9 C.F.R.

section 317.2(h)(2), Appendix A, infra, at p. 26, it

—>)

treated the matter summarily and overturned the trial

court’s well reasoned conclusion that the regulation

was void for vagueness.

In so holding the Court of Appeal categorized the

question as one of “facial” invalidity (Appendix A,

infra, at p. 26), stated there was no evidence tending

to show how much weight variation is considered rea-

sonable by the trade, and concluded that Christensen

and Becker had the burden of showing that the regula-

tion is incapable on its face of setting a standard

for its enforcement but had failed to meet that burden

(Appendix A, infra, at p. 35). The court below also

ignored the evidence introduced in the trial court and

that court’s refusal to hear other evidence on these

very issues.

Assuming, arguendo, that the Court of Appeals is

correct in its assertion that the issue is one of facial

invalidity of the questioned regulation, the court below

clearly erred in its holding that the regulation as it

interprets it sets an ascertainable standard.

The vagueness of the instant regulation as interpreted

by the circuit court is manifest. As set forth supra,

the court below interprets this regulation as permitting

“reasonable variations.” Yet nowhere in the regulation

is there definition of the phrases (1) “good distribution

practices,” (2) “unavoidable deviations,” (3) “good

manufacturing practices,” or (4) “reasonable varia-

tions.” Moreover, as interpreted by the court below,

the term “variations” suddenly takes on a different

meaning—that of “shortages.” Rather than follow (1)

the accuracy-on-the-average interpretation utilized by

the National Bureau of Standards, the federal agency

charged by law (See 31 Stat. 1449, 15 U.S.C.

=

§§ 272(d) and (5)) with supervising weights and meas-

ures laws and enforcement, or (2) the same interpreta-

tion uf an identical statutory standard by two federal

agencies, or (3) the judgment of the trial judge who

heard a USDA official describe how this regulation

was being applied, the circuit court chose to ignore

all constructions of the regulation which give an ascer-

tainable standard and thus reverted to a non-standard.

The regulation as construed by the court below

provides no guidance in determining whether a weight

shortage is “reasonable” or “unreasonable,” and is con-

trary to USDA administrative interpretation and EPA

regulation under an analogous statute. See supra, at

pp. 12-13 and Appendix C, infra, at pp. 71-73. And

USDA practice in the meat inspection field is wholly

arbitrary, the decision to recommend removal from sale

of short weight packages depending solely upon “a

judgment call” on the part of the Regional Compliance

Officer. Testimony on this point by the Officer in

Charge, Western Region, USDA Compliance Staff (See

Appendix C, infra, at pp. 74-88) had considerable im-

pact upon the trial judge, who found the regulation at

issue to be void for vagueness.

And, when counsel for petitioner Becker attempted

to introduce evidence of industry practice to show

that other packers met the standard of regulation urged

by petitioners—accurate weight on the average—the

trial court refused to admit evidence on this point.

(Appendix C, infra, at pp. 88-91.)

ee ee

—

Thus, while holding that petitioners had the burden

of showing the questioned regulation to be invalid,

the Court of Appeals (1) ignored a construction of

the regulation which would yield a useful standard,

(2) ignored the trial judge’s judgment in favor of

petitioners after he heard only the evidence on this

point which petitioners were permitted to introduce,

and (3) failed to remand with instructions to the

trial court to permit petitioners to introduce other

evidence on this point to sustain the burden*® which

the circuit court finds that petitioners did not meet.

The result is fundamentally unfair—a clear denial

of due process of law—requiring review by this court.

‘In validating the regulation the court below relied in large

part upon this court’s decison in United States v. Shreveport

Grain & E Co., 287 U.S. 77 (1932). However, as the District

Court points out, 357 Fed. Supp. at 534, Shreveport does

not reach the question presented in the instant case: the redele-

gation to each USDA compliance officer of deciding whether

in “his judgment” a variation (caused by an unknown) is

or is not “reasonable.”

The court below also relie’ heavily upon validation by Congres-

sional inaction: “Forty-two years of Congressional silence is

strong evidence that Congress has acquiesced in the Secretary's

[Agriculture] interpretation of the scope of his powers.” (Ap-

pendix A

First, the logic in this statement is questionable—even long-

standing acquiescence in unconstitutional activity cannot correct

constitutional infirmities.

Second, Congressional inaction may, equally, stand for ap-

proval of the States’ activity in this field.

Third, the absence of Congressional action on any question

is hardly evidence of more than the inherent complexity and

slowness of the legislative process. As the Congress has never

had the occasion to review by legislative change the Secretary

of Agriculture’s enforcement of the Wholesome Meat Act, cita-

tion by the court below of Red Lion Broadcasting Co. vy.

F.T.C., 395 U.S. 367, 381 (1969) and Flood v. Kuhn, 407

U.S. 253, 283 (1972) is inapposite.

Ss

3. The Holding of the Courts Below That There Is

Federal Jurisdiction Raises Significant and Recur-

ring Problems Concerning the Jurisdiction of Fed-

eral Courts and Is in Conflict With Prior Rulings

of This Court

The complex procedural history of the action below

and the two prior California Superior Court lawsuits

is Outlined in the statement of the case, supra.°

Petitioners contend that the court below grossly erred

in holding that the facts of the instant case make

inapposite application of the principle of this court's

decision in Missouri-Pacific Ry. Co. v. Fitzgerald, 160

U.S. 556 (1896) and Public Service Commission vy,

W ycoff, 344 U.S. 237 (1952).

The consequence of this error by the court below

was to confirm the fragmenting and scattering of litiga-

tion of the same questions among three courts, and

to encourage future litigants who are sued by state

law enforcement officers in state courts to bring “new”

actions in federal court. The multiplicity of litigation

and second class status for state courts which the

°The crucial facts are these; On February 17 and March

1, 1972, respectively, the District Attorneys (the Court of

Appeals mistakenly ascribes these lawsuits to the County Counsel

of these counties, Appendix A, infra, at pp. 9 and 10) of River-

side and Los Angeles Counties filed suit against Rath alleging vio-

lations of state false advertising and unfair competition laws

because, when offered for retail sale, the weight representations

made on the packages offered were false. Rath removed

both cases to District Court. Three days prior to entry of

the remand orders, Rath filed the action from which this

petition arises. That action contains allegations virtually identical

to those made in Rath’s counter-claims filed during the removal

proceedings and to those which Rath made in the state court

actions, thus showing Rath’s attempt to litigate its defenses to

the State Court actions in Federal Court.

==? |

decision below encourages is in conflict with a proper

relationship between state and federal courts. Just

‘ as a “new” action in federal court was brought in

this case so could “new” actions be brought to halt

all state enforcement activities.

In response to petitioners’ contention that Rath’s

District Court action was nothing more than an attempt

to get collateral review of the remand orders—a ma-

neuver which is specifically prohibited by 28 U.S.C.

section 1447"°—the Court of Appeals reasoned that,

notwithstanding the issuance of such an order by the

District Court, Rath was entitled to a federal forum

because the District Cdurt had not made any decision

with respect to the propriety of a federal forum for

Rath’s claims. Appendix A, infra.

In so holding the court below departed from this

court’s decision in Missouri Pacific Ry. Co., supra,

that the policy of finality in remand orders is applicable

in federal question as well as in diversity cases and

that after remand federal question defenses must be

litigated in the state court to which the action is

returned. /d. at 583. Accord Chandler v. O'Bryan,

445 F. 2d 1045, 1057-58 (10th Cir. 1971).

Further, the Ninth Circuit’s decision that the pro-

cedural history of this litigation does not demonstrate

Rath’s seizure of this litigation from state court is

contrary to the principle enunciated by this court in

Public Service Commission v. Wycoff, supra

“Where the complaint in an action for declaratory

judgment seeks in essence to assert a defense

28 U.S.C. section 1447 provides: “(d) An order remanding

a case to the State court from which it is removed is not

reviewable on appeal or otherwise. . . .”

—_— =

to an impending or threatened state court action,

it is the character of the threatened action, and

not of the defense, which will determine whether

there is federal question jurisdiction in the Dis-

trict Court. If the cause of action, which the

declaratory defendant threatens to assert, does not

itself involve a claim under federal law, it is

doubtful if a federal court may entertain an action

for a declaratory judgment establishing a defense

to that claim. This is dubious even though the

declaratory complaint sets forth a claim of federal

right, if that right is in reality in the nature

of a defense to a threatened cause of action.

Federal courts will not seize litigation from state

courts merely because one, normally a defendant,

goes to federal court to begin his federal law

defense before the state court begins the case

under state law.” 344 U.S. at 248. (Emphasis

added.) See also Skelly Oil Co. v. Phillips Co.,

339 U.S. 667, 672-74 (1950).

Attempting to distinguish the instant case from Wy-

coff the court below asserted that Wycoff applies only

when the controversy is “merely threatened or impend-

ing” (Appendix A, infra, at p. 17) and that the

instant controversy was not created by the institu-

tion of the state court actions against Rath, but arose

independently thereof by virtue of the removal of short

weight packages from sale prior to the commencement

of the state court lawsuits. (Appendix A, infra, at

p. 19.)

The facts compel a contrary conclusion. Even though

petitioner Becker met with Rath representatives and

eufiien

informed Rath that short weight packages would be

removed from sale, which, according to the Court of

‘ Appeals, was sufficient basis for Rath to seek relief

in a federal forum, Rath did nothing until the District

Attorneys filed suit and even then Rath took no “inde-

pendent” action until it realized that the state court

actions would be remanded.

Further, reliance of the court below upon this court’s

decision in Public Utilities Commission of .California

v. United States, 355 U.S. 534 (1958) is misplaced.

That case does not stand for the principle that Wycoff

is merely a statement that controversies which are

not ripe are not justiciable. Rather, it stands for an

entirely different proposition: when an administrative

agency cannot provide the remedy sought, the aggrieved

party may seek relief in an appropriate tribunal.

By contrast, in the instant case, Rath’s federal claims

would be properly presented and appropriately con-

sidered in state courts. Rath was not without a state

forum which would fairly consider its federal claims.

And, in the manner in which those claims arose, Rath’s

claims were by way of defense to a charge of violating

state laws. Thus Wycoff commands that those claims

be litigated in the state forum, and thus the court

below should have dismissed Rath’s federal complaint

for want of jurisdiction.

In Hicks v. Miranda, 423 U.S. 332 (1975), this

court confirmed that the rule of Younger v. Harris,

401 U.S. 37 (1970) is designed to “permit state courts

to try state cases free from interference from federal

courts [citation omitted] particularly where the party

to the federal case may fully litigate his claim before

_—s

the state court.” 422 U.S. at 349. Accord Samuels

v. Mackell, 401 U.S. 66 (1970).

While the state court prosecutions in the instant

case were for injunction and civil penalties and thus

not criminal in nature, they were nevertheless actions

to enforce state statutes brought by law enforcement

officials. Petitioners submit that for reasons analogous

to those underlying this court’s decision in Younger

v. Harris the trial court below should not have under-

taken to adjudicate this state court defendant’s defenses

when there was no indication that they would not

receive fair treatment in state court.

Thus, the refusal of the court below to dismiss

Rath’s complaint was an egregious error requiring inter-

cession by this court.

4. In Affirming the Trial Court’s Issuance of an

Injunction in the Face of Substantial Evidence

of Rath’s Unclean Hands, the Court Below Has

Sanctioned a Departure From the Accepted Course

of Judicial Proceedings and Disregard for Prior

Decisions of This Court, as to Call for an Exercise

of This Court’s Power of Supervision

In Precision Instrument Mfg. Co. v. Automotive

Maintenance Mach. Co., 324 U.S. 806 (1945), this

court confirmed that a party with unclean hands may

not invoke the equity jurisdiction of a court, and

noted the added significance of the doctrine of unclean

hands where the suit in equity concerns the public

interest. /d. at 815.

The instant case is one of public importance, as

is demonstrated by the necessity for a weights and

measures system upon which competitors and consumers

ofitiin

can both rely and by the impediments to commerce

and to confidence in governmental agencies which result

‘from failure of these agencies to discharge their duty

of assuring the truthfulness of product information

which is disseminated. The public significance and wide-

spread effect of the ultimate decision in this case

was recognized by the Court of Appeals. (Appendix

A, infra, at p. 26.)

Although Rath knew its label statements of weight

were false when its packaged bacon was sold to consum-

ers, Rath fully intended and expected that consumers

would believe those statements to be true. When con-

fronted with this obvious duplicity Rath complained

to the federal courts that the State of California would

not permit Rath to continue this deceptive practice.

In the face of the recognized public importance

of this case and apparent disregard of the facts—which

showed Rath to be knowingly in violation of the

statute which it sought to invoke,’ thus clearly dem-

onstrating Rath’s unclean hands—the District Court

granted, and the Court of Appeals affirmed, equitable

relief to Rath.

Petitioners submit that this constituted a manifest

abuse of discretion compelling review by this court.

"Evidence introduced at trial showed that more than 45%

of the packages of bacon which Rath produced were short

weight at time of shipment from Rath’s plant—in violation

of 21 U.S.C. §607(b). Further, one of the components of

the aqueous curing solution which Rath uses to cure its bacon,

tripolyphosphate, causes the product to retain moisture. An

offer of proof by Christensen of Rath’s own records was made

which revealed that during three weeks’ production there was

produced 3,904, 3,300 and 12,898 more pounds of bacon

than pounds of raw product used, a s violation of federal

laws. (Appendix C, infra, at pp. 95-96.)

—_—

Conclusion

For these reasons, a writ of certiorari should issue

to review the judgment and opinion of the Ninth

Circuit.

Respectfully submitted,

EvVELLE J. YOUNGER,

Attorney General of California,

CARL BORONKAY,

Assistant Attorney General,

HERSCHEL T. ELKINS,

ALLAN J, GOODMAN,

Deputy Attorneys General,

Counsel for Petitioner L. T. Wallace.

JOHN LARSON,

County Counsel,

Los Angeles County, California,

ARNOLD K. GRAHAM,

Deputy County Counsel,

Counsel for Petitioner M. H. Becker.

ie

APPENDIX A.

Opinion of the United States Court of Appeals

for the Ninth Circuit

United States Court of Appeals, for the Ninth Circuit.

The Rath Packing Company, a corporation, Plaintiff,

Counter-Defendant and Appellant, vs. M. H. Becker

as Director of the County of Los Angeles Department

of Weights and Measures, Defendant, Appellee and

Cross-A ppellant. Nos. 73-2481, 73-2482, 73-3092.

C. B. Christensen as Director of Agriculture of

the State of California, /ntervenor, Appellee and Cross-

Appellant.

The Rath Packing Company, a corporation, Plaintiff

and Appellant, vs. Joseph W. Jones as Director of

the County of Riverside Department of Weights and

Measures, Defendant, Appellee and Cross-Appellant.

Nos. 73-2496, 73-3180.

[October 29, 1975]

Appeal from the United States District Court for

the Central District of California.

Before: BROWNING and TRASK, Circuit Judges,

AND RICH, Judge.*

RICH, Judge:

These suits were brought by Rath Packing Company

(hereinafter “Rath”) to enjoin the enforcement of cer-

tain California statutes and regulations pertaining to

the labeling by weight of packaged foods at retail,

and for a declaration that the federal Wholesome Meat

*The Honorable Giles S. Rich, Judge, United States Court

of Customs and Patent Appeals, sitting by designation.

aniline.

Act of 1967, 21 USC, §601 et seq., and a regulation

promulgated thereunder, 9 CFR 317.2(h)(2), preempt

these California statutes and regulations. They were

consolidated for decision in the district court and on

appeal.

Rath is a nation-wide processor and seller of meat

products, including bacon, and maintains a meat-

packing establishment at Vernon, California, which is

subject to federal inspection under the Wholesome Meat

Act and 9 CFR 302.1 as an establishment in which

“any products of * * * carcasses of livestock are

* * * prepared for transportation or sale as articles

of commerce, which are intended for use as human

food.” Becker and Jones are the Directors of the Depart-

ments of Weights and Measures of Los Angeles and

Riverside Counties, California, respectively. They are

responsible for the actual enforcement of the State

weights and measures laws in their counties. Intervenor

Christensen is the Director of Agriculture of the State

of California.

Jurisdiction in the district court was based on 28

USC, §$1331(a), as it was alleged that a case or

controversy arising under the laws of the United States

involving more than $10,000 was presented.’ We have

jurisdiction of this appeal under 28 USC, §1291.

The district court, in a memorandum and order

reported at 357 F. Supp. 529 (C.D. Cal. 1973),

granted in part the relief requested, and all parties

appealed the determinations adverse to them.

This case is a companion to General Mills, Inc.,

et al. v. Jones, Nos. 73-3583 and 74-1051, decided

Jt is not disputed that the jurisdictional amount is present.

=—

concurrently herewith. Much of the discussion in this

opinion is applicable to the General Mills case as well.

Background

This case concerns the packaging and weighing of

bacon. In order to understand the issues, a brief descrip-

tion of the properties of bacon and how it is packed

and weighed is necessary.

The weighing and packaging of bacon at the Rath

plant takes place under internal Rath procedures which

have been submitted to an official of the United States

Department of Agriculture (USDA). After the pickled

and smoked pork bellies come from the bacon press,

where they are squared into uniform rectangular shapes,

they are sliced by a machine, which distributes the

slices in “drafts” of approximately one pound weight.

An operator places each draft on an insert, or “tux”,

board, which is a hardboard coated either with wax

or with polyethylene.” The drafts are then passed

to a scaling station, where they are weighed and the

operator either adds or removes bacon to bring the

weight within a predetermined target limit. After scaling

the bacon is passed to a tux overwrap machine, which

inserts the bacon into a carton and seals it. This

carton is not hermetically sealed and the bacon in

it does lose some moisture to the atmosphere over

time. Although Rath now does use some hermetically

sealed bacon containers, this packing method is agreed

to be in accordance with good distribution practices.

“The polyethylene-coated boards have absorbed 4/16 oz.

less of bacon moisture and grease than the wax-coated board

4 days after pack. The saturation point of waxed board is

reached 6 to 9 days after pack; about 5/16 oz. is absorbed.

a

Once the bacon is weighed at the scaling station,

it is not weighed again before it leaves the Rath

plant, an average of 4 days, never more than 8 or 9

days, later. In determining the pass zone Rath follows

the USDA procedure of subtracting from the actual

weight of the draft and the tux board on which it

lies the weight of a dry tux board. This method uses

a “dry tare.”’ There is no evidence that Rath has

violated federal weight standards in any way.

The federal program for regulation of net weight

labeling of meat and meat food products exists in

part under the Wholesome Meat Act of 1967, supra.

The Act added the concept of “misbranding” to the

prior federal meat inspection laws. 21 USC §601(n)

provides in relevant part:

(n) The term “misbranded” shall apply to any

carcass, part thereof, meat or meat food product

under one or more of the following circumstances:

* * * *

(5) if in a package or other container unless

it bears a label showing (A) the name and

place of business of the manufacturer, packer,

or distributor; and (B) an accurate statement

of the quantity of the contents in terms of

weight, measure, or numerical count: Provided,

That under clause (B) of this subparagraph

(5), reasonable variations may be permitted,

and exemptions as to small packages may be

estabished, by regulations prescribed by the

Secretary [of Agriculture | ;

* * * *

Tare. * * * la: the weight of a container or vehicle

that is deducted from the gross weight to obtain the net weight.”

Webster's Third New International Dictionary 2341 (1971).

— <a

In 9 CFR 317.2(h)(2) the Secretary purported to

implement §601(n)(5):

(2) The statement as it is shown on a label

shall not be false or misleading and shall express

an accurate statement of the quantity of contents

of the container exclusive of wrappers and packing

substances. Reasonable variations caused by loss

or gain of moisture during the course of good

distribution practices or by unavoi¢ Sle deviations

in good manufacturing practice will be recognized.

Variations from stated quantity of contents shall

not be unreasonably large.

In the supermarket the California inspectors em-

ployed a different weighing method, using a “wet tare.”*

The California procedure is set forth in detail in 4

Cal. Admin. Code ch. 8, subch. 2, Art. 5. Briefly,

the California inspectors follow a twelve-step procedure

set forth in Section 2933.3 of the regulations:

(1) determine the number of packages in the

lot to be sampled;

(2) from a table in the regulation, determine

the total package sample size (e.g., 15 packages

out of a lot of 300);

(3) from the same table, determine the tare

sample size (e.g., 2 packages out of a lot of

300);

(4) record the gross weight of each tare sample

package;

‘The difference in tares employed is not an issue in this

case.

po

(5) remove the usable contents from each tare

sample, weigh the used, empty container, and

compute the average tare weight;°

(6) weigh the remaining packages in the pack-

age sample and record their weights, determining

the amount of error from labeled weight for each

package;

(7) [not applicable to bacon];

(8) calculate the preliminary total error for

the sample, and determine the arithmetical average

error;

(9) calculate the range of error for each sub-

group of the package sample;

(10) determine whether any unreasonable er-

rors exist, and eliminate from further computations

all samples whose errors exceed the preliminary

average error in underweight situations by more

than the amounts set forth in tables in the regu-

lations; if the number of unreasonable errors ex-

ceeds a certain set figure for each sample size,

further action, including the issuance of off-sale

orders, may be undertaken.

(11) recalculate the total and average error of

the sample excluding the unreasonable errors;

(12) “(a) If the total error as obtained from

the sample is plus and is less than the value

shown in Table III for the corresponding range

and sample size, then a shortage may or may

not exist, and additional samples may or may

SThe container and tux board are weighed with all matter

adhering to the tare that does not pull off when the bacon

is removed included, as well as with any grease or moisture

that the tux board may have absorbed from the bacon. This

is “wet tare.”

—

not be taken, depending upon the discretion of

the weights and measures official. If no additional

samples are taken then the procedures as set

forth in the following sections shall govern the

disposition of the lot.

“(b) If the total error obtained from the sample

is less than the above-determined value, and the

error is minus, then a shortage may or may

not exist, and additional samples may or may

not be taken, depending upon the discretion of

the weights and measures official. If no additional

samples are taken the lot shall be passed. If

additional samples are taken then the procedures

as set forth in the following sections shall govern

the disposition of the lot.” [Sec. 2933.3.12. |

If an inspector cannot pass the lot based on this

sampling technique or after retesting, he then may

order the let off-sale under the provisions of California

Business and Professions Code §12211:

Each sealer shall, from time to time, weigh

or measure packages, containers or amounts of

commodities sold, or in the process of delivery,

in order to determine whether the same contain

the quantity or amount represented and whether

they are being sold in accordance with law.

* * * *

Whenever a lot or package of any commodity

is found to contain, through the procedures author-

ized herein, a less amount than that represented,

the sealer shall in writing order same off sale

and require that an accurate statement of quantity

be placed on each such package or container

ilies,

before the same may be released for sale by

the sealer in writing. The sealer may seize as

evidence any package or container which is found

to contain a less amount than that represented.

Evidence was adduced at the trial from various

California officials, including Becker, that the county

departments do not recognize variations in net weight

that result from water loss during good distribution

practice. Mr. Cervinka, a statistician employed by

the California Department of Agriculture, testified on

direct examination as an expert for Christensen that

Art. 5 of the regulation, described above, is a statis-

tically valid procedure. On cross-examination he indi-

cated that Art. 5 does not make any distinction between

products that lose water and those that do not, nor

does it make provision for any weight reductions during

the course of handling. On this and other evidence

the district court concluded that Art. 5 uses “absolute”

weight as determined by statistical methods as its

measure of compliance and makes no reference in

describing the steps of the weighing and calculating

process to reasonable variations from label weight

caused by “loss * * * of moisture during the course

of. good distribution practice.” The district court’s fact

findings have substantial evidentiary support and are

not clearly erroneous. F.R.Civ.P. 52(a). Becker, Chris-

tensen, and Jones do not urge error in the district

court’s construction of Art. 5.

Procedural History

During the period September 1971 to March 1972

inspectors under the supervision of Becker and Jones

visited supermarkets in Los Angeles and Riverside

—

Counties and weighed packages of Rath bacon to

determine compliance with the State statute and regula-

tions concerning net weight labeling. Becker’s repre-

sentatives ordered approximately 84 lots of bacon off

sale for short weight; Jones ordered nearly 400 packages

of Rath bacon off sale in the period September 29

to December 30, 1971, for the same reason.

On February 17, 1972, the Riverside County Counsel

brought an action in the name of the People against

Rath in the Superior Court for Riverside County for

an injunction under Cal. Civ. Code §3369° and for

civil penalties under Cal. Bus. and Prof. Code §17536,’

alleging that Rath had committed acts of unfair compe-

tition in violation of Cal. Bus. and Prof. Code §17500*

by distributing for sale in Riverside County super-

8Civil Code §3369 provides in material part:

2. Any person performing or proposing to perform an

act of unfair competition within this State may be enjoined

in any court of competent jurisdiction.

3. As used in this section, unfair competition shall mean

and include * * * any act denounced by Business and

Professions Code Section 17500 to 17536, inclusive.

7Section 17536:

(a) Any person who violates [§17500] shall be liable

for a civil penalty not to exceed two thousand five hundred

dollars ($2,500) for each violation, which shall be assessed

and recovered in a civil action brought in the name of the

people of the State of California by the Attorney General

or by any district attorney, county counsel, or city attorney

in any court of competent jurisdiction.

8Section 17500:

It is unlawful for any * * * corporation * * * to make

or disseminate or cause to be made or disseminated before

the public in this State, any representation * * * in any * * *

manner or means whatever, concerning * * * personal prop-

erty * * * or concerning any circumstances or matter of

fact connected with the * * * disposition thereof, and

which is known, or which by the exercise of reasonable

care should be known, to be true or misleading * * *.

— Ss

markets the packages of bacon that Jones’ representa-

tives had ordered off sale. On March 1, 1972, the

Los Angeles County Counsel filed a similar action

against Rath in the Superior Court for Los Angeles

County.

Rath removed both actions to federal district court

within a week thereafter; but on March 20, 1972,

the district court remanded the actions to the State

courts, finding, at least with respect to the Riverside

action, that there was no diversity of citizenship and

that “[n]o substantial federal question is presented

on the face of the pleadings.”

Meanwhile, on March 17, 1972, Rath filed two

actions in federal district court, one against the People’®

and Becker, the other against Jones. Rath requested

declarations that the California statutes and regulations

impose labeling standards on meat food products pre-

pared by Rath that are in addition to or different

than the standards of the Wholesome Meat Act of

1967, specifically 21 USC, §601(n)(5) and 9 CFR

317.2(h)(2) and that California could not impose

weight labeling requirements on Rath meat food prod-

ucts after they left the Rath plant. Rath also requested

injunctions against the enforcement by Becker and

Jones of labeling requirements in addition to or different

than those in the Act and against the ordering off-

sale or otherwise preventing the sale of Rath products

for failure of the products to bear an accurate label

in terms of net weight after they have left Rath’s

*The People were dismissed as a party by the district

court on the ground that the Eleventh Amendment bars suits

against the State of California by a citizen of another State.

Rath is an lowa corporation and is a citizen of Iowa for

this purpose. No appeal was taken from this dismissal.

auiium

plant. Becker, Jones, and Christensen counterclaimed

for the same relief sought by the State in the state

court actions.

After the remands, on March 30, 1972, Rath an-

swered the state court complaints and filed cross-com-

plaints seeking the same relief, in virtually the same

language, as Rath sought in federal court. In July

1972 Christensen intervened in both the state and

federal court litigations.

Becker filed in the district court motions requesting

the court either to abstain from deciding the federal

court action or to stay the federal action pending

final determinations in the state court actions. The

district court denied these motions in May 1972. On

November 14, 1972, the superior court in the Riverside

action dismissed Rath’s cross-complaint; Rath appealed.

On the very next day, Christensen and Becker moved

the district court to dismiss Rath’s action or to stay

it pending decision on Rath’s state appeal. The district

court denied the motions, and this court, on Christensen

and Becker’s petition for a writ of prohibition, declined

to disturb the district court’s assumption of jurisdiction.

On April 3, 1973, the district court, after a trial

on the merits of Rath’s action against Becker and

on cross-motion for summary judgment in the action

against Jones, entered judgment declaring Cal. Bus.

and Prof. Code §12211 and 4 Cal. Admin. Code

ch. 8, subch. 2, Art. 5 to be preempted by federal

law and enjoining their enforcement. In the course

of its Memorandum the court held that 9 CFR 317.2(h)

(2) was invalid, and that thus the sole federal labeling

standard was “accurate” weight. The court also held

—e

that accurate weight labeling standards could be applied

to packages of meat and meat food products at the

retail level. Cross-appeals were taken to this court.

The Riverside action continued, and in January 1974,

while Rath’s first appeal was still pending in the Califor-

nia District Court of Appeal, the superior court entered

summary judgment on the complaints of Jones and

Christensen against Rath; Rath appealed again. In an

unreported decision in April 1974 on Rath’s first ap-

peal, the California appellate court reversed the dismiss-

al of Rath’s cross-complaint against Jones, holding that

the federal court’s judgment was res judicata on the

issue of the validity of §12211 and Art. 5 (to the

extent that it implemented §12211). On Rath’s second

appeal, in December 1974, the appellate court reversed

the grant of summary judgment on the complaints

and remanded the case to the Riverside superior court

for trial, holding that there existed issues of fact that

required trial. People v. Rath Packing Company, 44

Cal. App. 3d 56, 118 Cal. Rptr. 438 (1974). The

appellate court also explained further the basis of its

decision on Rath’s first appeal, holding that the effect

of the federal court judgment was to preclude relitiga-

tion of the narrow issue of the preemption of §12211,

and its implementation in Art. 5, by the Wholesome

Meat Act. The appellate court held, 118 Cal. Rptr.

at 446 n. 6, that Art. 5 is not unconstitutional.

Although the record does not contain any notice

of the proceedings in the Los Angeles superior court

action, we are informed by Rath’s reply brief that

in February 1974 the Los Angeles court gave res

judicata effect to the final judgment on the preemption

issue and decided in Rath’s favor the issues of constitu-

tionality and whether Becker’s ordering of Rath’s bacon

—

off sale complied with state law. An appeal from

this judgment is pending.

I.

Becker, Jones, and Christensen contend that the

district court lacked jurisdiction of the subject matter

before it, and, in the alternative, that the principles

of abstention and comity required the court to stay

its hand until the state court actions had proceeded

to judgment. We reject both contentions.

A.

The question of subject matter jurisdiction may

be raised by the parties at any time or by the court

sua sponte. Clark v. Paul Gray, Inc., 306 U.S. 583

(1938); F.R.Civ.P. 12(h)(3). Becker et al. first con-

tend that the declaratory judgment actions brought

by Rath are nothing more than attempts to get collateral

review of the remands to state court of the actions

brought against Rath by the People which Rath had

removed to the district court. 28 USC, §1447, provides:

§1447. Procedure after removal generally.

*x * * a

(d) An order remanding a case to the State

court from which it was removed is not reviewable

on appeal or otherwise * * *.

Their second contention is that Rath’s claim for declara-

tory and injunctive relief in the district court is in

reality a defense to the state court actions, and, as

such, cannot form a basis for federal question jurisdic-

tion under 28 USC, §1331.

After the institution of Rath’s federal action Becker

et al. presented these contentions to this court by

—

way of a petition for a writ of prohibition, Becker

et al. v. Real, No. 72-3037, which the court, Ely

and Hufstedler, Circuit Judges, denied.” We find

no reason to depart from that decision.

Federal question jurisdiction is determined by the

federal district court solely from the face of plaintiff's

complaint. Gully v. First National Bank, 299 USS.

109 (1936). Removability cannot be created by defend-

ant pleading a counter-claim presenting a federal ques-

tion under 28 USC, $1331. See 1 Barron & Holtzoff,

Federal Practice and Procedure (Wright Ed.) §102;

United Artists Corp. v. Ancore Amusement Corp.,

91 F. Supp. 132 (S.D. N.Y. 1950). Thus, Rath’s

answer and cross-complaint in the state court, raising

its claim for declaratory and injunctive relief under

federal law, were not" before the district court when

it remanded the removed state court actions and do

not raise any issues necessarily adjudicated by the

court in deciding to remand. The decision of the district

court that the case does not invoke the federal jurisdic-

tion and must be remanded precludes further litigation

of the issue of the forum in which the removed case

is to be litigated. Missouri Pacific Ry. Co. v. Fitzgerald,

160 U.S. 556, 583 (1896). The decision of the district

court to remand has no bearing on the merits of

“Tt appearing from the face of the pleading that the

District Court has jurisdiction, the petition is denied. This

Court does not, however, now express any further opinion

on the merits of the controversy.”

We are not foreclosed by this order from reexamining the

jurisdictional issue at this time; we merely find the decision

to be sound.

1And could not have been, since the remand order was

entered March 20, 1972, and Rath’s claims were first presented

in the state court actions on March 30, 1972.

—

the underlying claims. Since the district court did not

make any decision with respect to the propriety of

‘ a federal forum for Rath’s claims, we cannot say

that the maintenance of Rath’s claim in federal court

works a circumvention of 28 USC, §1447(d). Cf.

Chandler v. O'Bryan, 445 F.2d 1045, 1057 (10th

Cir. 1971). Rath is not contending that the remand

orders were erroneous, but only that it has a righi

to a federal forum for its alleged federal claims.

The argument that Rath’s claims are not within

the federal question jurisdiction, it not being denied

that there is no diversity of citizenship, takes its roots

in the statement of the Supreme Court in Public Service

Commission v. Wycoff, 344 U.S. 237, 248 (1952):

Where the complaint in an action for declara-

tory judgment seeks in essence to assert a defense

to an impending or threatened state court action,

it is the character of the threatened action, and

not of the defense, which will determine whether

there is a federal-question jurisdiction in the Dis-

trict Court. If the cause of action, which the declar-

atory defendant threatens to assert, does not itself

involve a claim under federal law, it is doubtful

if a federal court may entertain an action for

a declaratory judgment establishing a defense to

that claim. This is dubious even though the de-

claratory complaint sets forth a claim of federal

right, if that right is in reality in the nature

of a defense to a threatened cause of action.

Federal courts will not seize litigations from state

courts merely because one, normally a defendant,

goes to federal court to begin his federal-law

defense before the state court begins the case

under state law * * * (emphasis added [by

the Court] ).

=

The doubt that the Court expresses is still with us,

e.g., C. Wright, Law of Federal Courts §18, at 62

(2d Ed. 1970).

In order to appreciate the Wycoff case we must

first look to the jurisdictional background of the De-

claratory Judgment Act, 28 USC, §2201.* The Act

is procedural only, creating a new federal remedy with-

out expanding the jurisdiction of the federal courts.

Aetna Life Ins. Co. v. Haworth, 300 U.S. 227 (1937).

“ ‘Jurisdiction’ means the kinds of issues which give

right of entrance to federal courts.” Skelly Oil Co.

v. Phillips Petroleum Co., 339 U.S. 667, 671 (1950).

The Wycoff “test” quoted supra has its origins in

Tennessee v. Union & Planters’ Bank, 152 U.S. 454,

464 (1894), where the Court said, “a suggestion of

one party, that the other will or may set up a claim

under the Constitution or laws of the United States,

does not make the suit one arising under that Constitu-

tion or those laws.” Furthermore, the complaint of

the declaratory plaintiff must present a federal question

“unaided by anything alleged in anticipation of avoid-

ance of defenses which it is thought the defendant

may interpose.” Taylor v. Anderson, 234 U.S. 74,

75-76 (1914).

In Wycoff the complainant brought an action for

declaratory judgment against the Utah Public Service

Commission, requesting a finding that the business

1282201 provides:

In a case of actual controversy within its jurisdiction,

except with respect to Federal taxes, any court of the

United States, upon the filing of an appropriate pleading,

may declare the rights and other legal relations of any

interested party seeking such declaration, whether or not

further relief is or could be sought. * * *. (Emphasis

added. )

— =

conducted by complainant in carrying goods between

points in Utah was interstate commerce (and thus

‘ not subject to regulation by the Commission). The

principal concern of the Court was the nature of the

controversy presented, 344 U.S. at 244;

A multitude of rights and immunities may be

predicated upon the premise that a business con-

sists of interstate commerce. What are the specific

ones in controversy? The record is silent and

the counsel little more articulate. We may surmise

that the purpose to be served by a declaratory

judgment is ultimately the same as respondent’s

explanation of the purposes of the injunction it

originally asked, which is “to guard against the

possibility that said Commission would attempt

to prevent respondent from operating under its

certificate from the Interstate Commerce Commis-

sion.” (Emphasis supplied [by the Court].)

From this the Court concluded that “this dispute has

not matured to the point where we can see what,

if any, concrete controversy will develop.” 344 US. at

245. In the portion of Wycoff quoted three paragraphs

above, the Court was applying its concern that the

controversy was not ripe for adjudication by pointing

out a declaratory plaintiff may not create a controversy

by seeking to have a federal court adjudicate federal

defenses he might assert in a proceeding before a

state court or administrative tribunal which is not

ripe, but which is merely threatened or impending.”

13The Court confirmed this view of Wycoff in Public Utilities

Commission of California v. United States, 355 US. 534,

538-39 (1958):

(This footnote is continued on next page)

— =

Another aspect of the matter was aired in Chandler

v. O'Bryan, supra. O'Bryan brought a libel action

in Oklahoma state court against Chandler, a United

States District Judge, on statements made by Chandler

to a newspaper accusing O’Bryan of bribing judges of

the Oklahoma Supreme Court. Chandler removed the

action to federal district court; but the district court

held that the acts alleged in the complaint were not

done in performance of Chandler’s official duties as

a federal judge, nor were they done under color of

judicial office, and remanded the case to the state

court for lack of a federal question, there being no

diversity of citizenship. It is settled that Chandler’s

judicial immunity defense arises under federal law.

Howard v. Lyons, 360 U.S. 593 (1959). A verdict

for O’Bryan was returned in the state court. Chandler

then filed a declaratory judgment action in federal

court seeking to have the state libel judgment enjoined

and expunged, «alleging his federal judicial immunity

claim. The district court granted relief to Chandler,

311 F. Supp. 1121 (W.D. Okla. 1969), but the 10th

Circuit (by a panel of three judges of the 8th Circuit)

reversed.

The court found Wycoff directly applicable, and

held that Chandler was seeking a separate federal

adjudication of a matter which was “in reality in

the nature of a defense” to the state court libel action,

The Commission has plainly indicated an intent to enforce

the Act; and prohibition of the statute is so broad as

to deny the United States the right to ship at reduced

rates unless the Commission first gives approval. The con-

troversy is present and concrete—whether the United States

has the right to obtain transportation service at such rates

as it may negotiate or whether it can do so only with

state approval.

=

which was based solely on state libel law and raised

no federal question itself. The action was dismissed

‘ for lack of federal jurisdiction.

The instant case is different. While it is true that

judgment in Rath’s favor affects the results of the

Los Angeles and Riverside actions, we cannot say

that Rath’s action is premature or that Rath’s claim

is merely a defense to the state court actions. The

ordering off-sale of Rath’s products in September 1971

and afterward and the upward adjustment of the pass

range at the sealing station at Rath’s plant, increasing

the overpack of bacon necessitated by California weigh-

ing procedures, it was stipulated below, caused Rath

a loss of more than $10,000. The off-sale orders

themselves are sufficient State action to create an

actual controversy between Rath and the state weights

and measures officials. See Lake Carriers’ Ass'n v.

MacMullan, 406 U.S. 498, 508 (1972). The present

controversy was not created by the institution of the

state court actions against Rath, but arose independently

thereof by virtue of the off-sale orders.

Unlike Chandler, Rath’s claims have vitality in the

absence of the litigation in state court; Rath had

the right to a federal forum before the institution

of the state court actions. Chandler’s federal claim

was purely in the nature of a defense to the libel

action. Brought without reference to the underlying

state court proceeding, Chandler’s claim would be a

useless gesture: no one would care whether Chandler

acted under the protection accorded by the courts

to his office if O'Bryan had refrained from suing

him. That Rath’s claim is or can be the basis for

a defense to the state court actions states a mere

_—

truism,‘* the test is whether Rath has created a

federal controversy where none existed or is seeking

an adjudication of a claim which is essentially meaning-

ful only when pleaded as a defense to the particular

pending state court actions. We find neither factor

present and consider that Rath has stated claims which

are within the federal jurisdiction conferred on the

district court by 28 USC, §1331."°

B.

We also hold that considerations of comity and

abstention did not require the district court to relinquish

jurisdiction.

Comity is a principle of long standing:

We live in the jurisdiction of two sovereignties,

each having its own system of courts to declare

and enforce its laws in common territory. It would

14Becker, Jones, and Christensen do not assert that Rath’s

cross-complaints in the state court actions were compulsory

under Cal. Code of Civ. Proc. §428.10; they assert that they

wer’ improper pleadings under the statute. We have no opinion

on . is matter of state procedure, but it does seem to us

to show that the interposition of affirmative claims by Rath

in the state courts is not a relevant factor in determining

whether the federal courts have jurisdiction of Rath’s affirmative

claims.

15Jones’ argument that the district court improperly assumed

jurisdiction of a res already in the control of the state courts

is without merit. Suits for injunctions are in personam, not

in rem, Penn General Casualty Co. v. Pennsylvania, 294 U.S.

189, 195 (1935), and state and federal courts having concurrent

jurisdiction are “free to proceed in [their] own way * * *,

without reference to the proceedings in the other court. * * *

The rule, therefore, has become generally established that where

the action first brought is in personam and seeks only a

rsonal judgment, another action for the same cause in another

jurisdiction is not precluded.” Kline v. Burke Construction Co.,

260 U.S. 226, 230 (1922). We observe that in any case

Rath’s claims were made in district court thirteen days before

Rath’s state cross-complaints were filed. The controversy here

—2)—

be impossible for such courts to fulfil their respec-

tive functions without embarrassing conflict unless

rules were adopted by them to avoid it. The

people for whose benefit these two systems are

maintained are deeply interested that each system

shall be effective and unhindered in its vindication

of its laws. The situation requires, therefore, not

only definite rules fixing the powers of the courts

in cases of jurisdiction over the same persons

and things in actual litigation, but also a spirit

of reciprocal comity and mutual assistance to

promote due and orderly procedure.

* * * *

The chief rule which preserves our two systems

of courts from actual conflict of jurisdiction is

that the court which first takes the subject-matter

of the litigation into its control, whether this

be person or property, must be permitted to exhaust

its remedy te attain which it assumed control,

before the other court shall attempt to take it

for iis purpose. Ponzi v. Fessenden, 258 U.S.

254, 259-60 (1921).

This circuit has defined the rule of comity as “merely

recognizing exclusive jurisdiction in the court first

acquiring jurisdiction of any action.” Gregg v. Win-

chester, 173 F.2d 512, 513 (9th Cir. 1949). Under

these rules and in the present circumstances, the prin-

ciple of comity does not suggest that the district court

should have declined to hear Rath’s claims. The subject

matter of the litigation before us consists of the federal

is not over any property right or status in the bacon, but

over the enforcement of state laws which affect how the bacon

is sold.

==

questions raised by Rath in its complaint. These federal

questions were first taken into the control of a court

when Rath filed its complaint in the district court

on March 17, 1972. No state court could have acquired

jurisdiction over this subject matter until Rath answered

and filed its cross-complaints in the state courts on

March 30, 1972. Our conclusion is reinforced by

the actions of the District Court of Appeal in the

Riverside action twice giving res judicata effect to

the federal district court judgment. If, as Becker and

Christensen contend, the only matter preventing the

first Riverside judgment, dismissing Rath’s cross-com-

plaint against Jones, from being given preclusive effect

as a final judgment is Cal. Code of Civ. Proc. §1049,"°

the California appellate court would not have directed

the trial court to abandon its position and to follow

the federal judgment, which, since it had been appealed,

was just as “final” as the Riverside judgment if evaluated

under California law. We do not see here the federal-

state conflict that the comity doctrine seeks to avoid.

The district court acquired jurisdiction over the federal

question prior to the state courts, and very scrupulously

avoided deciding even tangentially the constitutionality

of the California statutes and regulations or whether

the actions of the inspectors were in compliance with

state law. The state courts have not questioned the

right of the district court to take the action it did

and held the federal judgment entitled to preclusive

effect in the state courts on the particular issues litig ated

in the federal court.

16Cal. Code of Civil Procedure §1049:

An action is deemed to be pending from the time

of its commencement until its final determination upon

appeal, or until the time for appeal has passed, * * *

—

In applying the abstention doctrine a federal district

court has discretion in declining to exercise or postpon-

ing the exercise of jurisdiction it already has in deference

to a state court resolution of underlying issues of

state law. Railroad Comm'n of Texas v. Pullman Co.,

312 U.S. 496 (1941). Abstention is appropriate only

where the issue of state law is uncertain, Harman

v. Forssenius, 380 U.S. 528 (1965), and where “the

delay and expense to which the application of the

abstention doctrine inevitably gives rise” can be justi-

fied. England v. Board of Medical Examiners, 375

U.S. 411, 418 (1964). However, abstention is not

automatic whenever a question of state law may be

involved. As the Court said in Baggett v. Bullitt,

377 U.S. 360, 376-77 (1964), a case in which the

Court considered abstention to be unnecessary:

In the bulk of abstention cases in this Court,

* * * the unsettled question of state law prin-

cipally concerned the applicability of the chal-

lenged statute to a certain person or a defined

course of conduct, whose resolution in a particular

mai.ner would eliminate the constitutional issue

and terminate the litigation.

This statement reflects the judicial policy of avoiding

the adjudication of federal constitutional questions un-

less they are ripe and are squarely presented by the

record.

“The basic question involved in [federal preemption]

cases, however, is never one of interpretation of the

Federal Constitution but inevitably one of comparing

two statutes.” Swift & Co. v. Wickham, 382 US.

111, 120 (1965). Thus we do not have a situation

where a state law interpretation by a state court may

enliien

eliminate a federal constitutional question. Cf. Reetz

v. Bozanich, 397 U.S. 82 (1970). There is no conten-

tion by Becker, Jones, or Christensen that California

law is unclear or ambiguous or that the construction

of California law in the state courts will obviate a

decision on Rath’s federal preemption claim. The Cali-

fornia statutes and regulations apply to Rath without

question. We think this case is akin to Harman v.

Forssenius, supra, in which the Court said: “If the

State statute in question, although never interpreted

by a state tribunal, is not fairly subject to an inter-

pretation which will render unnecessary or substantially

modify the federal * * * question, it is the duty

of the federal court to exercise its properly invoked

jurisdiction. Baggett v. Bullitt, 377 U.S. 360, 375-

379.” We hold that the district court did not abuse

its discretion in refusing to abstain.

Il.

In holding 9 CFR 317.2(h)(2) invalid, the district

court said:

{The section] is void for its inadequacy to

set any recognizable standard upon which any

individual may measure his conduct or his com-

pliance with the law by which he must order

his personal or business life. 357 F. Supp. at 534.

Rath alleges two bases of error: (1) the validity of

the regulation was not put in issue by the parties

below and should not have been considered by the

district court; and (2) the district court erred on

the merits of the issue.

Rule 16 of the Federal Rules of Civil Procedure

provides that “[t|he court shall make an order * * *

— =

which limits the issues for trial to those not disposed

of by admissions or agreements of counsel; and such

order when entered controls the subsequent course of

the action unless modified at the trial to prevent mani-

fest injustice.” [Emphasis added.| The pretria. order

entered by the court with the consent of the parties

in the Becker action does not name as an issue the

validity of 9 CFR 317.2(h)(2); nor, for that matter,

do the pleadings and motion papers in the Jones action.

The first appearance of the issue in the Jones action

was at the argument on the motions for summary

judgment:

THE COURT: The question is, is the regulation,

and that is (h)(1) and (2) and particularly

(2), that is 317.2(h)(2), is it a valid regulation.

MR. KEIR [Counsel for Jones]: Well, we don’t

challenge the validity of (h)(2).

THE COURT: You don’t? You don’t? I have

some serious questions about it.

MR. KEIR: Maybe I should retract that for

the record. Frankly, I hadn’t considered whether

it is valid or not. I merely submit to the court,

and this is the position we have taken right along,

is that (h)(2) is an innocuous provision.

It was not until the close of the trial of the Becker

action that the district judge requested argument on

the issue, and by so doing put the issue before the

parties.

Ordinarily, issues not squarely presented in the plead-

ings and motion papers or not preserved in the pretrial

order are considered to have been eliminated from

an action. See, e.g. L & E Co. v. United States

=_— =

ex rel. Kaiser Gypsum Co., 351 F.2d 880 (9th Cir.

1965); Fowler v. Crown Zellerbach Corp., 163 F.2d

773 (9th Cir. 1947; see also 3 Moore's Federal Practice

416.19. This is particularly true in a declaratory jdug-

ment action, where the court is called upon to adjudi-

cate only those matters as to which the parties ask

that their rights be determined. In this case, however,

the parties have fully briefed and argued this issue

both here and before the district court. In their con-

solidated post-trial memorandum, Becker and Christen-

sen requested a declaration that 9 CFR 317.2(h)(2)

was invalid. Rath does not claim that the court’s con-

sideration of the issue—as opposed to its decision

on the issue, with which Rath differs—has resulted

in any actual prejudice to it, nor did Rath object

in its reply brief in the district court to consideration

of the issue. By failing to object, Rath may be deemed

to have acquiesced in an expansion of the issues by

the court from those set forth in the pretrial order.

Furthermore, the issue, as discussed below, is one of

“facial” invalidity under the 5th Amendment which

does not require a fully developed evidentiary basis

for its resolution. Cf. Rescue Army v. Municipal Court,

331 U.S. 549 (1947). We note the public importance

of this question, and the possibility of review of our

judgment herein. Since a controversy presently exists

between the parties on the issue, and since the judg- :

ment of the district court turned in large part on

its resolution of this issue, we proceed to the merits

of the controversy.

—= =

Although we have some doubts as to the applicabil-

ity of the “void-for-vagueness” doctrine in its traditional

formulation” to this non-criminal situation, the parties

do not question the doctrine’s applicability to this case.

However, we need not decide its applicability, since

we are of the opinion that the regulation passes muster

when the due process standards enunciated by the

Criminal cases in the economic area are applied to

it. There is no claim that lst Amendment rights are

involved, the presence of which would necessitate strict-

er scrutiny by us. Smith v. Goguen, 415 U.S. 566,

572-73 (1974).

The crux of the district court’s holding of invalidity

can be found in the following [357 F. Supp. at 534]:

What [United States v. Shreveport Grain &

Elevator Co., 287 U.S. 77 (1932)], supra, is

telling us is that the statutory delegation is viable.

It does not give viability to a redelegation that

is subject to varying degrees of reasonableness.

The statute gives the Secretary the power of defini-

tion of “reasonable variations.” The Secretary here

has completely failed to accept the duty that can

be expressed only in rules and regulations properly

promulgated pursuant to federal laws. [Footnote

omitted; emphasis in original. |

17Connally v. General Construction Co., 269 U.S. 385,

391 (1926):

That the terms of a penal statute creating a new offense

must be sufficiently explicit to inform those who are subject

to it what conduct on their part will render them liable

to its penalties, is a well-recognized requirement, con-

senant alike with ordinary notions of fair play and the

settled rules of law. And a statute which either forbids

or requires the doing of an act in terms so vague that

(This footnote is continued on next page)

—_28—

Neither the statute nor the regulations contain quan-

titative statements of what variations will be considered

reasonable." There is likewise no evidence tending

to show how much weight variation is considered reason-

able by the trade. In the absence of evidence of how

the regulation is applied, the burden rests on the parties

challenging the regulation, Becker and Christensen, to

show that the regulation is incapable of setting a

standard of enforcement on its face.” Their chal-

lenge fails for two independent reasons, which cor-

respond to the separate rationales underlying the por-

tions of the district court’s opinion reproduced supra.

The district court seems concerned with “reasonable-

ness” as a standard for guiding conduct. This standard

is of ancient provenance in English and American

law and is not obnoxious in itself to the Fifth Amend-

ment of the Constitution. In the ordinary negligence

case, for instance, the sole difference between no liabil-

ity and sizeable penalty in the form of damages may

be whether the acts in issue are considered those

of a reasonable man by a jury long after the fact.

A more telling analogy is found in the criminal applica-

men of common intelligence must necessarily guess at

its meaning and differ as to its application, violates the

first essential of due process of law. [Emphasis added. ]

See also United States v. Harriss, 347 U.S. 612, 617 (1954).

18Rath offered as evidence a USDA manual eae

to contain the quantitative variations to be permitted USDA

inspectors, which the court excluded as irrelevant as not

having been promulgated by the Secretary of —— under

the Whchasoase Meat Act by publication in the Federal Register.

Rath does not urge this ruling as error, and we shall not

comment on it. Except for this manual, however, Rath con-

cedes that the quantitative scope of “reasonable variations” recog-

nized by the Secretary is nowhere set forth in any writing.

- United States v. National Dairy Products Corp., 372

U.S. 29, 32-33 (1963).

==

tion of the Sherman Act, 15 USC, §1 et seq. The

English courts distinguished legal from illegal contracts

restraining trade by whether the restraint imposed was

reasonable. Mitchel v. Reynolds, 1 P. Williams 181,

24 Eng. Rep. 347 (King’s Bench, 1711); see discussion

in United States v. Addyston Pipe & Steel Co., 85

Fed. 271 (6th Cir. 1898), mod. and aff'd., 175 US.

211 (1899); and Standard Oil Co. v. United States,

221 U.S. 1, 51 (1911). Standard Oil, supra, construed

the prohibition of the Sherman Act against “[Any]

contract, combination * * *, or conspiracy, in restraint

of trade * * *,” to apply only to those restraints

which are unreasonable as understood in the common

law. When the criminal application of the Sherman

Act was challenged, in Nash v. United States, 229

U.S. 373 (1912), on the ground that “the crime defined

by the statute contains in its definition an element

of degree as to which estimates may differ,” Mr.

Justice Holmes, speaking for the Court, said:

But apart from the common law as to restraint

of trade thus taken up by the statute the law

is full of instances where a man’s fate depends

on his estimating rightly, that is, as the jury

subsequently estimates it, some matter of degree.

If his judgment is wrong, not only may hé incur

a fine or a short imprisonment, as here; he may

incur the penalty of death. * * * We are of

opinion that there is no constitutional difficulty

in the way of enforcing the criminal part of the

act. 229 U.S. at 378-79.

See also United States v. Ragen, 314 U.S. 513, 523-

24 (1942). More recently, the Supreme Court upheld

against a constitutional challenge a criminal proceeding

aiiiibes

under §3 of the Robinson-Patman Act, 15 USC, §13a,

which makes it a crime to sell goods at “unreasonably

low prices for the purpose of destroying competition

or eliminating a competitor.” United States v. National

Dairy Corp., 372 U.S. 29, 34-36 (1963). We con-

clude, therefore, that the regulation, which permits

“reasonable variations caused by loss or gain of moisture

during the course of good distribution practices or

by unavoidable deviations in good manufacturing prac-

tices,” has not been shown by the parties claiming

its invalidity to be impossible of application without

depriving those to whom it is applied fair notice of

the practices which are not within the permission of

the regulation. The nature of the recognized variations

is clearly set forth; Becker, Jones, and Christensen

have not alleged that those subject to the regulation,

such as Rath,” could not perceive the conditions

under which the regulation would permit reasonable

variations in weight to be recognized. The characteriza-

tion of the recognized variations as “reasonable” is

not constitutionally infirm in itself, as the cases show.

“The Court did not uphold the statute on its face, but

only as applied to the acts charged in the indictment. The

Court did, however, distinguish the case from United States

v. Cohen Grocery Co., 255 U.S. 81 (1921), in which a

statute proscribing “any unjust or unreasonable rate or charge”

was invalidated. The Court saved §3 by finding that the statute

made clear reference to the nature of the conduct prohibited,

i.e., that which was intended to destroy competition, etc. 372

U.S. at 35.

219 CFR 302.1(a) provides:

(a) Inspection under the regulations in this subchapter

{which includes 317.2(h)(2)] is required at:

(1) Every ‘establishment * * * in which any products

of * * * carcasses of livestock * * * are prepared

for transportation or sale as articles of commerce, which

are intended for use as human food.

—

Our conclusion is confirmed by the holding of the

Supreme Court in Parker v. Levy, 417 U.S. 733

(1974), that Article 134 of the Uniform Code of

Military Justice, which punishes “[a]ll disorders and

neglect to the prejudice of good order and discipline

in the armed forces,” is not void for vagueness. See

also Ricci v. United States, 507 F.2d 1390 (Ct. Cl.

1974). Application of the regulation, as gauged on

this record, does not offend the due process clause

of the 5th Amendment, as it has not been shown

that the regulation fails to give fair notice of the

variations to be permitted under it.

The second prong of the district court’s criticism

of the regulation is that it constitutes an impermissible

redelegation to USDA field inspectors of the authority

granted by Congress to the Secretary to determine

what variations caused by gain or loss of moisture,

etc., were to be permitted. This conclusion is error,

as the legislative history and precedent demonstrate.

In enacting the Wholesome Meat Act of 1967, Con-

gress made additions to the statutory framework under-

lying federal meat inspection programs and standards.

In particular, Congress created a series of definitions

modeled on the definitions used in the Food, Drug,

and Cosmetic Act, 21 USC, §301 et seq. In S. Rep.

No. 799, 90th Cong., Ist Sess.,* the Committee said

with respect to Sec. 1(n) of S. 2147, which became

21 USC, §601(n), the statutory basis of the ques-

tioned regulation:

(n) Misbranded.—The definition of this term

not heretofore used in the Meat Inspection Act,

222 U.S. Code, Cong. and Admin. News, 90th Cong., Ist

Sess., pp. 2188-2213 (1967).

enliiin

is discussed in connection with section 12. It

is based on the definition of the same term in

the Federal Food, Drug, and Cosmetic Act and

is identical except that—

In new section 1(n)(5) the introductory

phrase is slightly different in that it refers to

“other container” besides packages and requires

a label “showing” rather than containing” speci-

fied information; and in the proviso, reasonable

variations and exemptions “may” instead of

“shall” be allowed by the Secretary of Agricul-

ture instead of the Secretary of Health, Educa-

tion, and Welfare. Also an internal reference

to a clause is made in different terms than

in the Federal Food, Drug, and Cosmetic Act.

x* * %* *

It is therefore proper for us to consider the history

and construction of the Food, Drug, and Cosmetic

Act prior to 1967 in interpreting the scope of the

Secretary’s power to promulgate regulations.

In United States v. Shreveport Grain & Elevator

Co., 287 U.S. 77 (1932), the Supreme Court had

occasion to construe the Food and Drug Act and

regulations thereunder, as they were in force at that

time. The relevant portion of the Act provided:

[A]n article of goods shall be deemed misbrand-

ed—

* * * *

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: Provided,

however, That reasonable variations shall be per-

= =

mitted and tolerances and also exemptions as to

small packages shall be established, by rules and

regulations made in accordance with * * * this

Act.

The regulation stated:

(i) The following tolerances and variations

from the quantity of the contents marked on the

package shall be allowed:

(1) Discrepancies due exclusively to errors in

weighing, measuring, or counting which occur in

packing in compliance with good commercial prac-

tice.

* ok Ba =

(3) Discrepancies in weight or measure, due

exclusively to differences in atmospheric conditions

in various places, and which unavoidably result

from the ordinary and customary exposure of the

packages to evaporation or to the absorption of

water.

Discrepancies under classes (1) and (2) of

this paragraph shall be as often above as below

the marked quantity. The reasonableness of dis-

crepancies under class (3) of this paragraph will

be determined on the facts in each case.

The resemblance between the present statute and regu-

lation and the statute and regulation in force in 1932

is apparent.

The Court held that the substantive standard created

by the Act was that packages be marked plainly and

conspicuously with their weights, and that the statutory

proviso gave the involved Secretaries the administrative

—

authority to permit reasonable variations from this hard

and fast rule. The Court continued [287 U.S. at 84]:

Moreover, the practical and long continued con-

struction of the executive departments charged

with the administration of the act and with the

duty of making the rules and regulations therein

provided for, has been in accordance with the

view we have *xpressed as to the meaning of

the section under consideration. The rules and

regulations, as amended on May 11, 1914, deal

with the entire subject in detail under the recital,

“(i) The following tolerances and variations { ital-

ics supplied] from the quantity of the contents

marked on the package shall be allowed: .. .”

Then follows an enumeration of discrepancies due

to errors in weighing which occur in packing

conducted in compliance with good commercial

practice; due to differences in capacity of bottles

and similar containers, resulting from unavoidable

difficulties in manufacture, etc.; or in weight due

to atmospheric differences in various places, etc.

These regulations, which cover variations as well

as tolerances and exemptions, have been in force

for a period of more than eighteen years, with

the silent acquiescence of Congress.

The Court did not question the authority of the Secre-

tary to promulgate the regulation. In the forty-two

years since the Shreveport Grain case Congress has

not changed its delegation of authority tc the Secretary

to “permit reasonable variations,” nor have the regula-

tions promulgated expressly under that authority in-

cluded any quantitative expressions of the variations

to be permitted.

wee tet ee ae OS een tte

— =

The question, therefore, is: Has the Secretary failed

to heed the intent of Congress in giving him authority

to permit reasonable variations by declining to put

numerical limits on the variations he and his representa-

tives will permit in the enforcement of the substantive

standard of the Act? In the Food, Drug, and Cosmetic

Act of 1938, 52 Stat. 1040, Congress reenacted the

provisions of the prior Act in substantially identical

terms to those before the Court in Shreveport Grain.”

It has been held that Congress gives a regulation

the force and effect of law by reenactment of the

statutory provision to which it pertains. Helvering v.

R. J. Reynolds Tobacco Co., 306 U.S. 110 (1939).

We note also the presumption that reenactment of

a statutory provision by Congress without significant

change indicates its approval of prior judicial interpre-

tation of that provision. United States v. Douglas Air-

craft Co., 510 F.2d 1387 (CCPA 1975). Becker,

Jones, and Christensen have adduced nothing to over-

come the conclusion that the regulation is a valid

exercise of the authority delegated to the Secretary

by Congress. The regulation must be presumed valid,

and the burden is on those contending its invalidity

to persuade us otherwise. Forty-two years of Congres-

sional silence is strong evidence that Congress has

acquiesced in the Secretary’s interpretation of the scope

23Sec, 403. A food shall be deemed misbranded—

* + *& &

(e) If in package form unless it bears a label containing

* * * (2) an accurate statement of the quantity of

the contents in terms of weight, measure, or numerical

count: Provided, That under clause (2) of this paragraph

reasonable variations shall be permitted and exemptions

as to small packages shall be established by regulations

prescribed by the Secretary.

=

of his powers. See Flood v. Kuhn, 407 U.S. 258,

283 (1972); Red Lion Broadcasting Co. v. FCC,

395 U.S. 367, 381 (1969). We do not, for the above

reasons, concur in the district court’s analysis of Shreve-

port Grain, and hold that the district court erred

in finding 9 CFR 317.2(h) (2) invalid. :

III.

The central issue in this litigation is whether sections

of the California statute and regulations promulgated

thereunder are preempted by the Wholesome Meat

Act of 1967 and 9 CFR 317.2(h)(2). The district

court based iis holding of preemption on its finding

that the statistical variations allowed by California from

the accurate weight standard imposed by 21 USC,

§601(n)(5), in the absence of valid regulations per-

mitting reasonable variations thereunder, created a net

weight labeling standard “different than” the federal

standard. We agree with the holding, but not with

the reasoning on which it was based.

“Our principal function is to determine whether,

under the circumstances of this case [the state regula-

tions and] law stands as an obstacle to the accomplish-

ment and execution of the full purposes and objectives

of Congress” in enacting the Wholesome Meat Act

and delegating to the Secretary the power to make

regulations thereunder. Hines v. Davidowitz, 312 U.S.

52, 67 (1941). The inquiry in this case will follow

the lines set forth in Florida Lime & Avocado Growers,

Inc. v. Paul, 373 U.S. 132, 142 (1963):

The principle to be derived from our decisions

is that federal regulation of a field of commerce

Pe el ee

eolition

should not be deemed preemptive of state regula-

tory power in the absence of persuasive reasons—

either that the nature of the regulated subject

matter permits no other conclusion, or that Con-

gress has unmistakenly so ordained.

21 USC, §678, was enacted as part of the Wholesome

Meat Act of 1967, Pub. L. 90-201, §408, 81 Stat.

600. We are of the opinion that in it “Congress

has unmistakenly so ordained.” Accord, Armour and

Company v. Ball, 468 F.2d 76 (6th Cir. 1972).

This conclusion follows from the clear language and

legislative history of 21 USC, §678. The first part

of the section reads in relevant part:

Requirements within the scope of this chapter

with respect to premises, facilities and operations

of any establishment at which inspection is pro-

vided under subchapter I of this chapter, which

are in addition to, or different than those made

under this chapter may not be imposed by any

State * * *, except that any such jurisdiction

may impose record-keeping and other requirements

within the scope of section 642 of this title,

if consistent therewith, with respect to any such

establishment. Marking, /abeling, packaging, or

ingredient requirements in addition to, or different

than, those made under this chapter may not

be imposed by any State * * * with respect

to—articles prepared at any establishment under

inspection in accordance with the requirements

under subchapter I of this chapter * * *. [Em-

phasis added. |

—_— =

The report of the Senate Committee, S. Rep. No.

799, 90th Cong., ! st Sess., states:**

The committee feels that Federal standards must

be required of all meat and meat food products

sold for human consumption in this country.

* * * *

However, the committee wants it clearly under-

stood that the requirements on wholesomeness,

additives, labeling, and the other Federal regula-

tions are not to be compromised and must be

at least equal to Federal standards.

* * *

Section 408 [codified at 21 USC, §678] would

exclude States * * * from imposing marking,

labeling, packaging, or ingredient requirements in

addition to or different than those under the

Federal Meat Inspection Act for articles prepared

in accordance with title I of the act * * *.

This language clearly shows the intent of Congress

to create a uniform national labeling standard, under

the definitions set forth in the Wholesome Meat Act,

including the definition of “misbranding” in §601(n).

The express language of §678 implements this clear

Congressional intent.

In the absence of regulations under the Act the

statutory labeling” standard under the Act is that

242 U.S. Code Cong. and Admin. News, 90th Cong., Ist

Sess., 2191, 2207 (1967).

25Jones’ argument that California imposed no “labeling”

requirements, but rather sought to prevent “misbranding” under

Cal. Bus. and Prof. Code §12211, is strained. 21 USC §601(n)

read as a whole, defines violation of its “labeling” requirements

as “misbranding.” As we hold below, the federal standards,

which include definitions of terms, prevail over conflicting State

standards.

Se er

=—s

the label reflect “accurate” weight, as the district court

held. 9 CFR 317.2(h)(2) adds to this federal standard

the condition that “reasonable variations caused by

loss or gain of moisture during the course of good

distribution practices * * * will be recognized.”

The California statutes and regulations must impose

such a standard of labeling on Rath or they are

preempted by federal law as requiring weight informa-

tion on labels “different than” that required by federal

law.

Cal. Bus. and Prof. Code §12211 establishes the

following standard: “that the average weight or measure

of the packages or containers in a lot of any such

commodity sampled shall not be Jess, at the time

of sale or offer for sale, than the net weight or

measure stated upon the package.” (Emphasis added. )

This section also provides for the promulgation of

regulations to govern the sampling and weighing pro-

cedures. The California regulations, the district court

concluded, provide only for a statistical variation from

the absolute accurate weight and make no reference

to loss of moisture from the packages of bacon (or other

products that lose moisture, for that matter) experienced

between the time the bacon is weighed in the plant and

the time that California inspectors weigh the bacon at

the retail store. We agree with the district court that

Cal. Bus. and Prof. Code §12211 and 4 Cal. Admin.

Code, ch. 8, subch. 2, Art. 5, impose labeling standards

“different than” those under federal law and may

not be enforced.

Jones, Becker, and Christensen claim that this holding

infringes on the legitimate interests of the State of

California protecting its citizens from short-weight meat

products. We cannot agree. Christensen and Becker

—40—

recognized the true situation in their brief: “Christensen

and Becker submit that by [21 USC, §678] Congress

sanctioned the adoption by the states of laws (statutes

and regulations) which impose the same standard re-

quired by the Wholesome Meat Act * * * and

which are enforced by means of state enforcement

procedures. (Emphasis in original.) The concluding

portion of §678 reads in relevant part as follows:

* * * but any State * * * may, consistent

with the requirements under this chapter, exercise

concurrent jurisdiction with the Secretary over

articles required to be inspected under said sub-

chapter I, for the purpose of preventing the distri-

bution for human food purposes of any such

articles which are adulterated or misbranded and

are outside of such an establishment * * *.

This chapter shall not preclude any State or Terri-

tory or the District of Columbia from making

requirement or taking other action, consistent with

this chapter, with respect to any other matters

regulated under this chapter.

Our holding does not diminish the Congressional

grant in §678 to the States of enforcement jurisdiction

concurrent with the Secretary over misbranded articles

outside federally inspected establishments, if the States

do not impese labeling and other requirements “in

addition to or different than” the federal standards

when exercising their concurrent jurisdiction. We have

merely held that California cannot exercise its con-

current jurisdiction through the particular standards

established by §12211 and Art 5. California is free

ee I Ce i STIRS

a el

—4)]—

to enact other statutes and regulations which do not

offend §678. It must be further understood that the

only matters at issue are net weight labeling standards;

our judgment herein does not pertain to other matters

which are or may be regulated by the State of California.

IV.

Rath urges as error the holding of the district court

that the federal net weight standard set by 21 USC,

§601(n)(5), “can be applied to packages of meat

or meat food products at the ultimate end of a meat

processor’s distribution system—the retail store.” Im-

plicit in this holding is that California may exercise

the concurrent enforcement jurisdiction permitted it

by 21 USC, §678, by the imposition of appropriate

standards through the inspection of packages at the

supermarket.

Rath’s position is at odds with the intent of the

Wholesome Meat Act and with the grant of concurrent

enforcement jurisdiction to the States. 21 USC, §602,

states that “It is essential in the public interest that

the health and welfare of consumers be protected

by assuring that meat and meat food products distrib-

uted to them are wholesome, not adulterated, and

properly marked, labeled, and packaged.” (Emphasis

added.) 21 USC, §624, gives the Secretary the power to

promulgate regulations governing the storage and han-

dling of meat and meat food products “to assure

that such articles will not be * * * misbranded

when delivered to the consumer.” (Emphasis added.)

ain.

The emphasized portions make it clear to us that

Congress intended to continue the protection provided

under the Wholesome Meat Act to the point at which

the consumer receives the meat and meat food products

subject to the Act, i.e., at the retail food store level.”

21 USC, §673(a) provides for federal seizure of

misbranded meat and meat food products which are

“held for sale [i.e., in a retail store] in the United

States after * * * transportation [in commerce],”

and §673(b) indicates that federal seizure does not

“derogate from authority for condemnation or seizure

conferred by * * * other laws.” The concurrent

jurisdiction granted by 21 USC, §678, to enforce appro-

priate State standards outside of federally inspected

establishments would be a nullity if it were to be

construed to prevent State enforcement at a level of

distribution which Congress clearly intended to be sub-

ject to non-exclusive federal regulation.

Rath, however, argues that the federal net weight

standard requires that the label be accurate only when

the product leaves the establishment, relying on 21

USC, §607(b).* Accordingly, says Rath, the State

may not require conformance with the federal standard

of accurate weight, with reasonable variations, etc.,

considered, past that point. Such an argument renders

meaningless the allowance of reasonable variations for

26See also, 9 CFR 317.2(b), promulgated under 21 USC,

§601(n)(6), which provides in part:

{Any label term must be] likely to be read and under-

stood by the ordinary individual under customary conditions

of purchase and use.

2™(b) All * * * meat and meat food products inspected

at any establishment under the av‘hority of this subchapter

* * * shall at the time they leave the establishment bear

* * * the information required under paragraph (n) of

section 601 of this title.” (Emphasis added. )

—43—

gain or loss of moisture during the course of good

distribution practices. Why would the federal scheme

consider distribution practices to be relevant at all

if the federal net weight labeling standard applied

only at the point at which distribution of the product

commenced? We cannot attribute such a restrictive

reading to §607(b). Rath’s objections are met by

the reasonable variations allowance; whatever weight

variation results from gain or loss of moisture occurring

in the chain of distribution from packing plant to

retail store must, under 9 CFR 317.2(h)(2), be taken

into account in determining whether the net weight

labeling of a package at retail complies with the federal

standard.

V.

After the district court filed its order enjoining the

enforcement of Cal. Bus. and Prof. Code §12211 and

4 Cal. Admin. Code ch. 8, subch. 2, Art. 5, Christensen

promulgated a new regulation, Art. 5.1, to

* * * apply only during the proceedings [of

the instant case]. This Article is adopted as a

temporary authority to protect California whole-

salers, retailers, and consumers against short weight

packages of meat and meat products * * *.

The district court refused to modify its order to enjoin

the enforcement of Art. 5.1 and Cal. Bus. and Prof.

Code §12607, the alleged statutory authority for

the regulation. Rath requests us to enlarge the declara-

tion and injunction to hold invalid and enjoin the

enforcement of these provisions as well.”

2*Rath did not appeal separately from the denial of its

motion to amend the judgment. The issue was

Rath’s initial notice of appeal, since the injunction granted

(This footnote is continued on next page)

ee

§ 12607 provides:

Whenever a consumer commodity is offered

for sale, exposed for sale, or sold without a state-

ment of net quantity appearing thereon * * *,

the sealer shall in writing order the commodity

off sale and require that a correct statement of

net quantity be placed on the commodity before

the same may be released by the sealer.

This section, standing by itself, is innocuous if “net

quantity” is a designation of contents by weight which

is not “in addition to or different than” the federal

net weight labeling requirements. Art. 5.1 shows that

the interpretation of “net quantity” enforced in Cali-

fornia is “different than” the federal standard:

2940.1 Package Inspection. (a) Fach sealer

of weights and measures shall, within his county,

inspect packages of meat and meat products and

poultry and poultry products to determine whether

the label weight stated on the package is accurate

at time of inspection.

(b) The determination of accuracy shall be

made by weighing all of the usable product within

the container, exclusive of wrappers and packing

substances.

(c) As an alternative procedure to the pro-

cedure stated in subsection (b), the sealer of weights

by the district court was narrower in scope than the relief

requested by Rath. Rath’s notice of appeal specifically noted

the limitation of relief. We also note that the district court,

357 F. Supp. at 533, relied on Becker, Jones, and Christensen’s

citation of §12211 as the primary statutory authority in fashion-

ing the remedy. By changing their statutory basis of authority,

they scarcely should argue that Rath has the burden of foreseeing

what regulations they will use next.

Hate sae a, Mat

—_— =

and measures shall establish an accurate tare

weight for the containers within a lot of packages

and weigh each of the inspected packages. He

shall:

(1) Remove 3 packages from the lot at

random and weigh each of the unopened pack-

ages;

(2) Remove from each of the 3 containers

all of the usable product, exclusive of wrappers

and packing substances; and

(3) Determine the tare weight for each of

the 3 packages separately by subtracting the

weight of the usable product from the gross

weight.

He shall weigh separately each of the packages

in the lot to be inspected and apply as a tare

weight for purposes of the lot the lowest tare

weight obtained by the above procedure.

(d) For purposes of the procedure specified

in subsection (c), a lot is defined as a group

of packages assembled in one place, of the same

product and brand, in apparently identical con-

tainers, bearing the same statement of weight.

It is clear beyond cavil that Art. 5.1 makes no allow-

ance for variations from accurate weight whatever.

Since the federal standard, by virtue of 9 CFR 317.2

(h)(2), requires recognition of reasonable variations

due to gain or loss of moisture, etc., Art. 5.1 is

preempted by the federal standard and may not be

enforced. To the extent that §12607 is interpreted

to permit a definition of “net quantity” which does

not recognize the reasonable variations allowed by the

— =

federal standard, it is likewise preempted and may not

be enforced.” The applicability of Art. 5.1 only

during the “proceedings” of this case does not deter

us from considering its enforcement improper, since

we have no control over the interpretation of its period

of applicability either administratively or by a state

court except by assuring by injunction that Art. 5.1

will not be enforced at all.

VI.

CONCLUSION

In recapitulation we hold:

(1) that the district court had jurisdiction over

the subject matter of this case, personal juris-

diction being conceded;

(2) that the district court erred in invalidating

9 CFR 317.2(h)(2);

(3) that the Wholesome Meat Act of 1967,

21 USC, §601 et seq., and 9 CFR 317.2(h)(2)

preempt Cal. Bus. and Prof. Code §12211 and

4 Cal. Admin. Code ch. 8, subch. 2, Art. 5,

2°%Section 12607 is not saved by Cal. Bus. and Prof. Code

§12613, which provides:

If any — of this chapter is less stringent or

requires information different from any requirement of Sec-

tion 4 of the act of Congress entitle[d] “Fair Packaging

and Labeling Act” (P.L. 89-755; 80 Stat. 1296, 15 U.S.C.

1451-1461) or of any regulation promulgated pursuant

to such act, the provision shall be inoperative to the

extent that it is less stringent or requires information dif-

ferent from any such federal requirement, in which event

each such federal requirement is a part of this chapter.

No California standard, even if of equal or greater stringency

than the federal standard, may be enforced if it is fo

from the federal standard. As enforced in Art. 5.1, §12607

is different from the Wholesome Meat Act standard, whether

less stringent or not. The Fair Packaging and Labeling Act

is, of course, not relevant to this case.

— =

and that Becker, Jones, and Christensen were

properly enjoined from enforcing those sections;

(4) that the district court correctly held that

state standards not in addition to or different

than the federal net weight labeling standard may

be enforced by appropriate State procedures at the

retail level; and

(5) that 4 Cal. Admin. Code ch. 8, subch.

2, Art. 5.1, is preempted by federal law, that

Cal. Bus. and Prof. Code §12607 is preempted

by federal law to the extent indicated in part

V, supra, and that their enforcement should be

enjoined.

Accordingly, the judgment of the district court is

affirmed in part, reversed in part, and the case is

remanded for entry of an amended order in conformance

with this opinion.

[357 Fed. Supp. 529-36]

The Rath Packing Company, a corporation, Plaintiff

and Counter-Defendant, v. M. H. Becker as Director

of the County of Los Angeles Department of Weights

and Measures, Defendant, C. B. Christensen as Director

of Agriculture of the State of California, Intervenor.

The Rath Packing Company, a corporation, Plaintiff,

v. The People of the State of California, Joseph W.

Jones as Director of the County of Riverside Depart-

ment of Weights and Measures, Defendants. Civ. A.

Nos. 72-607-R, 72-608-R. United States District Court,

_ C. D. California. April 3, 1973.

_~

MEMORANDUM OPINION

AND ORDER

REAL, District Judge.

These matters have been consolidated for decision

after trial of Case No. 72-607-R, and hearing of cross-

motions for summary judgment in case No. 72-608-

R. The facts of both cases have much commonality

with little or no dispute of the facts necessary to

disposition of both cases.

Plaintiff, The Rath Packing Company, (hereafter

Rath), is a meat processor subject to inspection pur-

suant to the terms of the federal Wholesome Meat

Act of 1967, 21 U.S.C. § 601 et seq.

Defendants M. H. Becker (hereafter Becker) and

Joseph W. Jones (hereafter Jones) are Directors of

County Department of Weights and Measures of Los

Angeles and Riverside Counties respectively. C. B.

Christensen, as Director of Agriculture of the State

of California has heretofore been granted leave to

intervene in the Becker action and has participated

in presenting the defense in that action.

The controversey arises out of the actions of Becker

and Jones through their respective deputies of ordering

off-sale meat products delivered by Rath to retail stores

found to be short of the weight stated on the label.

Determination of short-weight has been made in each

case by the application of the provision of Title 4,

California Administrative Code, Chapter 8, subchapter

2, Article 5.

Fundamental to resolution of the validity of Becker

and Jones’ actions is a determination of the reach of

the federal Wholesome Meat Act of 1967, 21 U.S.C.

—-

—49—

§ 601 et seq., i.e., preemption by the federal government

of the regulation of meat and meat products.

The federal Wholesome Meat Act of 1967 was enact-

ed by Congress with the finding that:

“. . . Unwholesome, adulterated, or misbranded

meat or meat food products impair the effective

regulation of meat and meat food products in

interstate or foreign commerce, are injurious to

the public welfare, destroy markets for wholesome,

not adulterated, and properly labeled and packaged

meat and meat food products, and result in

sundry losses to livestock producers and processors

of meat and meat food products, as well as injury

to consumers.” 21 U.S.C. § 602.

A reading of the statutory scheme together with

the legislative history’ demonstrates clearly, in the

context of our concern here, that Congress intended

to broaden federal regulation of meat and meat food

products to cope with adulteration, unwholesomeness

and misbranding for the welfare of consumers.

The essence of the controversy here is found in

Congressional enactment of Title 21, United States

Code, Section 601(n) which provides:

“(n) The term ‘misbranded’ shall apply to any

. meat or meat food product under one

or more of the following circumstances:

(5) if in a package or other container unless

it bears a label showing . . . (B) an accurate

statement of the quantity of the contents in terms

of weight, measure or numerical count: Provided,

1U.$. Code Congressional and Administrative News, 90th

Congress, First Session, 1967, pages 2188-2213.

7 hey

a we

That under Clause (B) of this subparagraph (5),

reasonable variations may be permitted, .. .

by regulations prescribed by the Secretary.”

Rath claims that it meets the criteria of 21 U.S.C.

§ 601(n)(5) when its products are considered under

the application of regulations published by the Secretary

of Agriculture in 9 C.F.R. § 316.1 et seq. and 21

U.S.C. § 607(b).

21 U.S.C. § 607 (b) provides in its pertinent part:

“(b) All . . . meat and meat food products

inspected at any establishment under the authority

of this subchapter . . . shall at the time they

leave the establishment bear, in distinctly legible

form, directly thereon or on their containers .. .

the information required under paragraph (n) of

section 601 of this title.”

Rath argues that section 607(b) limits the inquiry

of accurate weight to the time meat or meat food

products leave a processor’s plant under federal inspec-

tion. Rath here argues for too much. To complete

the regulatory scheme and maintain continuing enforce-

ment, Congress gave federal meat inspectors the power

of seizure of adulterated or misbranded meat or meat

food products at any level of distribution. 21 U.S.C.

§ 673 makes clear that the provisions of section 601 (n)

(1-12) can be applied to packages of meat or meat

food products at the ultimate end of a meat processor’s

distribution system—the retail store.

The defendants so argue—but they fall short in

the recognition of what it is they are permitted to

do by the federal Wholesome Meat Act of 1967.

The provisions of 21 U.S.C. § 679 limit the state

a

=

in clear and unequivocal language. Therein, the states

are admonished that “. . . [M]arking, labeling, packag-

ing or ingredient requirements in addition to, or differ-

ent than, those made under this chapter may not

be imposed by any State . . . with respect to articles

prepared at any establishment under inspection in ac-

cordance with the requirements under subchapter I

of this chapter. . . .” Rath is clearly within these

requirements.

Defendants defend their acts and rely—as the source

of their authority and practice—upon state statutes.

We now proceed to analyze that state statutory scheme

to determine whether it meets the limitations of 21

U.S.C. § 678 when applied to the products of Rath.

Defendants cite as their primary source California

Business and Professions Code section 12211 which

provides in its pertinent part:

Ҥ 12211. Weighing or measuring commodities

sold or being delivered; rules and regulations;

off sale order; evidence. Each sealer shall .. .

weigh or measure packages, containers or amounts

of commodities sold, or in the process of delivery,

in order to determine whether the same contain

the quantity or amount represented. ...

The director is hereby authorized and directed

to adopt and promulgate necessary rules and regu-

lations governing the procedures to be followed

by sealers . . . in determining whether any package

or container or a lot of such packages or con-

tainers complies with the provisions of this section.

* * * *

Whenever a lot or package of any commodity

is found to contain . . . a less amount than

— =

that represented, the sealer shall in writing order

same off sale. . . .”

Following the direction of the California legislature,

the Director of Agriculture of the State of California

has published in Title 4, California Administrative

Code, Chapter 8, subchapter 2, Article 5 (hereafter

Article 5) a comprehensive procedure for testing com-

modities to determine their compliance with California

Business and Professions Code section 12211. In a

detailed step by step process, the sealer is led to

the determination of whether or not the commodities

in question “contain a lesser amount than represented”.

The procedure is a statistical determination based upon

normal and proven statistical standards. As such, the

result can be no better than the objective, and the

stated objective of Article 5 is to determine by sampling

techniques the qualification of a lot of commodities

to the requirements of section 12211, i.e., that the

quantity represented on the label is what the package

contains. These techniques are questioned by Rath

as contravening the prohibition against adding to or

differing from the labeling requirements of the federal

Wholesome Meat Act of 1967. Defendants argue valid-

ity, urging that preemption by the federal government

is limited by 21 U.S.C. § 678 when it provides:

= .. but any State or Territory or the

District of Columbia may, consistent with the

requirements under this chapter, exercise concur-

rent jurisdiction with the Secretary over articles

required to be inspected under said subchapter

I, for the purpose of preventing distribution . . .

of any such articles which are adulterated or mis-

branded and are outside of such an establishment.

”

ee Ee ee OO ee te ee eee On ee ee one Lew ene eer tee

ee a >

Ae OS i te

—= =

It is clear in the provisions for concurrent jurisdiction

outside an inspected plant that such actions as are

undertaken by states in the regulation of meat and

meat food products must be consistent with the require-

ments of the federal Wholesome Meat Act of 1967.

That Act has spoken upon the subject of misbranding—

and more particularly when misbranding is related to

comparison of the label with contents as provided

in 21 U.S.C. § 601(n)(5) in this language:

“(n) The term ‘misbranded’ shall apply to any

. .. Meat or meat food product...

* * *

(5) if in a package or other container it bears

a label showing . . . (B) an accurate statement

of quantity . . . in terms o¢ weight . . .: Pro

vided, That under clause (B) of this subparagraph

(5) reasonable variations may be permitted...

by regulations prescribed by the Secretary.”

To implement subsection (5), the United States

Secretary of Agriculture published rules and regulations

in Title 9, Code of Federal Regulations. In section

317.2(h)(2) the Secretary provides:

“(2) The statement as it is shown on a label

shall not be false or misleading and shall express

an accurate statement of the quantity of contents

of the container exclusive of wrappers and packing

substances. Reasonable variations caused by loss

or gain of moisture during the course of good

distribution practices or by unavoidable deviations

in good manufacturing practice will be recognized.

Variations from stated quantity of contents shall

not be unreasonably large.”

California Article 5 just does not meet this federal

standard. Nowhere in the measuring processes set forth

ccniliiin

therein in detail is any consideration given to the

possible “loss . . . of moisture during the course of

good distribution practice.” The measure of Article

5 is “absolute” as determined by accepted statistical

methods and, as such, erroneously encroaches upon

the standards provided by the federal Wholesome Meat

Act of 1967.

Defendants argue, however, that section 317.2(h) (2)

is void for vagueness; that, therefore, we are left with

the absolute standard, “an accurate statement of .. .

weight”. Though valid, this argument does not end

the inquiry in favor of state action. California Article

5-~though measuring the absolute provided in Califor-

nia Business and Professions Code section 12211—

applies a statistical “averaging” concept for the sealer to

make the final determination of whether or not pack-

ages in violation should be ordered “off-sale”. The fed-

eral Wholesale Meat Act of 1967 does not give state

legislatures or state officers—even in the grant of con-

current enforcement jurisdiction—the right to sub-

stitute their judgment of what variances, either plus

or minus come within the absolute standard of “an

accurate statement of . . . in terms of weight.” 21 U.S.C.

§ 601(n)(5)(B). Plaintiff argues the validity of 9

C.F.R. § 317.2(h)(2), citing the Supreme Court sanc-

tion of a similar statute in United States v. Shreveport

Grain & Elevator Company, 287 U.S. 77, 53 S.Ct.

42, 77 L.Ed. 175 (1932).

But Shreveport, supra, does not reach the regulation

under consideration here. In Shreveport, supra, the

primary standard was given vitality because the “rules

and regulations . . . deal with the entire subject in

detail under the recital, ‘(i) the following tolerances

a ee ee ee eee a eT

eR ee ee ee

—_

=~ =

and variations’... .” (Emphasis added.) The Court

then goes on to say at page 84, 53 S.Ct. at page 44:

“ .. Then follows an enumeration of discrepan-

cies due to errors in weighing which occur in

packing conducted in compliance with good com-

mercial practice; ... .”

What Shreveport, supra, is telling us is that the statutory

delegation is viable. It does not give viability to a

redelegation that is subject to different enforcement re-

sulting in varying degrees of reasonableness. The statute

[21 U.S.C. § 601(n)(5)] gives the Secretary the power

of definition of “reasonable variations”. The Secretary

here has completely failed to accept the duty that

can be expressed only in rules and regulations properly

promulgated pursuant to federal law.’ Section 317.2(h)

(2) is void for its inadequacy to set any recognizable

standard upon which any individual may measure his

conduct or his compliance with the law by which

he must order his personal or business life.’

Conceding the invalidity of section 317.2(h)(2) to

defendants, they now argue that the state is free to

set its own standards of “reasonable variations” citing

Florida Lime and Avocado Growers, Inc. v. Paul,

373 U.S. 132, 83 S.Ct. 1210, 10 L.Ed.2d 248, rehearing

denied, 374 U.S. 858, 83 S.Ct. 1861, 10 L.Ed.2d

1082. The error of such dependence on Florida Lime,

supra, is evidenced by the recognition by the Supreme

25 U.S.C. §§ 551-559.

8Under the regulation as it is written one meat inspector

may conclude that x% loss of moisture can be expected.

Given the same factual context, another meat inspector may

come to the conclusion that y% loss of moisture is reasonable.

Delegation of “administrator’s function” has never included giv-

ing each enforcement officer the “keys to the jailhouse”.

aniline

Court, beginning at page 142, 83 S.Ct. 1210, that

Congress had not foreclosed activity by the states where

it can be reconciled with federal regulation. Here the

defendants attempt to justify the California statutory

scheme by a misunderstanding that labeling, qua label-

ing, is what the federal Wholesome Meat Act of 1967

is all about and that California’s statute is aimed

at misbranding. This conclusion is erroneous for two

reasons:

1. Congress has defined “misbranding”.

2. “Misbranding” has no meaning except insofar

as it describes a departure from the labeling de-

scription of a commodity within a package.‘

The Court is aware of the admonition in Florida

Lime, supra, in measuring preemption when the Su-

preme Court says at page 142, 83 S.Ct. at page 1217:

“The principle to be derived from our decisions

is that federal regulation of a field of commerce

should not be deemed preemptive of state regula-

tory power in the absence of persuasive reasons—

either that the nature of the regulated subject

matter permits no other conclusion, or that the

Congress has unmistakenly so ordained.”

The Congress here has left no doubt. It is the

provisions of the federal Wholesome Meat Act of 1967

that are applicable to mislabeling or misbranding that

must be applied. Neither state legislatures nor state

officers can add or subtract from those definitions.

If administrative definition of “reasonable variances”

is desirable, it is the United States Secretary of Agricul-

‘Each of the twelve categories of misbranding described

in 21 U.S.C. § 601(n) refers to, in some way, a label.

Common sense tells us that mislabeling and misbranding are

synonymous terms.

—~ =

ture who must speak. When he fails to speak or

misspeaks his authority, the state cannot substitute

its voice. Defendants here do not, in any sense of

the word, pretend to be applying federal statutory

standards. The enforcement of California Business and

Professions section 12211 and its implementation in

California Administrative Code Article 5 exceeds the

concurrent enforcement rights of the state and its of-

ficers.

This conclusion should not in any way be taken

to mean that state officers (sealers) cannot continue

their stated mission to protect consumers of their respec-

tive jurisdictions. They have available to them a federal

statutory scheme which, when properly executed by

state or federal officers, secures to the American home-

maker the assurance that expected wholesomeness and

value is received for each consumer dollar spent. That

the evidence here shows the United States Department

of Agriculture may have abdicated some of its protec-

tive duty, does not justify the application of a different

labeling requirement by the state of California and

its officers.

The claimed exemptions by Rath of its meat

and meat food products do not—if beyond the preemp-

tion standards recognized herein—need resolution to

fully determine the controversy between the parties.

In case No. 72-607-R judgment shall be entered

for plaintiff.

In case No. 72-608-R the motion for summary

judgment of defendant is denied. The motion for sum-

mary judgment of plaintiff is granted.

Accordingly,

It is ordered:

—-™s=

1. That defendants and intervenor in case No.

72-607-R, and defendants in case No. 72-608-R,

together with their respective deputies, inspectors, of-

ficers, agents, servants, employees, attorneys and other

persons in active concert or participation with them,

and each of them, are restrained and enjoined perma-

nently from applying the provisions of California Busi-

ness and Professions Code section 12211 and/or the

provisions of Title 4, California Administrative Code,

Chapter 8, subchapter 2, Article 5, to articles prepared

and marketed by plaintiff under United States Depart-

ment of Agriculture’s inspection in accordance with

the requirements of the federal Wholesome Meat Act

of 1967 [21 U.S.C. § 601 et seq.].

2. The Court reserves the continuing jurisdiction

to make any modification to this injunction upon proper

application by any party, as the ends of justice may

require.

Ce es

—59—

APPENDIX B.

Constitutional and Statutory Provisions Involved

Constitution of the United States, Article VI, clause 2.

This Constitution, and the Laws of the United

States which shall be made in Pursuance thereof;

. . . Shall be the supreme Law of the Land;

and the Judges in every State shall be bound

thereby, any Thing in the Constitution or Laws

of any State to the Contrary notwithstanding.

Amendment X.

The powers not delegated to the United States

by the Constitution, nor prohibited by it to the

States, are reserved to the States respectively,

or to the people.

Wholesome Meat Act, 81 Stat. 584, 21 United States

Code § 601 et seq.

§ 601. Definitions.

As used in this chapter, except as otherwise

specified, the following terms shall have the mean-

ings stated below:

(a) The term “Secretary” means the Secretary

of Agriculture of the United States or his delegate.

*e# *& *

(h) The term “commerce” means commerce

between any State, any Territory, or the District

of Columbia, and any place outside thereof; or

within any Territory not organized with a legisla-

tive body, or the District of Columbia.

(n) The term “misbranded” shall apply to any

carcass, part thereof, meat or meat food product

under one or more of the following circumstances:

—60—

(1) if its labeling is false or misleading in any

particular;

s* * *

(4) if its container is so made, formed, or

filled as to be misleading;

(5) if in a package or other container unless

it bears a label showing (A) the name and place

of business of the manufacturer, packer, or distrib-

utor; and (B) an accurate statement of the quantity

of the contents in terms of weight, measure, or

numerical count: Provided, ‘That under clause (B)

of this subparagraph (5), reasonable variations

may be permitted, and exemptions as to small

packages may be established, by regulations pre-

scribed by the Secretary;

**# *&

(o) The term “label” means a display of

written, printed, or graphic matter upon the imme-

diate container (not including package liners)

of any article.

(p) The term “labeling” means all labels and

other written, printed, or graphic matter (1) upon

any article or any of its containers or wrappers,

or (2) accompanying such article.

§ 602. Congressional statement of findings.

Meat and neat food products are an important

source of the Nation’s total supply of food. They

are consumed throughout the Nation and the major

portion thereof moves in interstate or foreign com-

merce. It is essential in the public interest that

the health and welfare of consumers be protected

by assuring that meat and meat food products

distributed to them are wholesome, not adulterated,

i ee Ce ee oe eee a

eniiiius

and properly marked, labeled, and packaged. Un-

wholesome, adulterated, or misbranded meat or

meat food products impair the effective regulation

of meat and meat food products in interstate

or foreign commerce, are injurious to the public

welfare, destroy markets for wholesome, noi adul-

terated, and properly labeled and packaged meat

and meat food products, and result in sundry

losses to livestock producers and processors of

meat and meat food products, as well as injury

to consumers. The unwholesome, adulterated, mis-

labeled, or deceptively packaged articles can be

sold at lower prices and compete unfairly with

the wholesome, not adulterated, and properly

labeled and packaged articles, to the detriment

of consumers and the public generally. It is hereby

found that all articles and animals which are

regulated under this chapter are either in interstate

or foreign commerce or substantially affect such

commerce, and that regulation by the Secretary

and cooperation by the States and other juris-

dictions as contemplated by this chapter are appro-

priate to prevent and eliminate burdens upon

such commerce, to effectively regulate such com-

merce, and to protect the health and welfare of

consumers.

$607. Labeling, marking, and container require-

ments.

(a) Labeling receptacles or coverings of meat

or meat food products inspected and passed; super-

vision by inspectors.

When any meat or meat food product prepared

for commerce which has been inspected as herein-

-_ =

before provided and marked “Inspected and

passed” shall be placed or packed in any can,

pot, tin, canvas, or other receptacle or covering

in any establishment where inspection under the

provisions of this subchapter is maintained, the

person, firm, or corporation preparing said product

shall cause a label to be attached to said can,

pot, tin, canvas, or cther receptacle or covering,

under the supervision of an inspector, which label

shall state that the contents thereof have been

“inspected and passed” under the provisions of

this subchapter; and no inspection and examination

of meat or meat food products deposited or in-

closed in cans, tins, pots, canvas, or other recep-

tacle or covering in any establishment where in-

spection under the provisions of this subchapter

is maintained shall be deemed to be complete

until such meat or meat food products have been

sealed or inclosed in said can, tin, pot,. canvas,

or other receptacle or covering under the super-

vision of an inspector.

(b) Information on articles or containers; legible

form.

All carcasses, parts of carcasses, meat and

meat food products inspected at any establishment

under the authority of this subchapter and found

to be not adulterated, shall at the time they leave

the establishment bear, in distinctly legible form,

directly thereon or on their containers, as the

Secretary may require, the information required

under paragraph (n) of section 601 of this title.

(c) Labeling: type styles and sizes; definitions

and standards of identity or composition; standards

of fill of container; consistency of Federal and

Federal-State standards.

—_63—-

The Secretary, whenever he determines such

action is necessary for the protection of the public,

may prescribe: (1) the styles and sizes of type

to be used with respect to material required to

be incorporated in labeling to avoid false or mis-

leading labeling in marketing and labeling any

articles or animals subject to this subchapter or

subchapter II of this chapter; (2) ldefinitions and

standards of identity or composition for articles

subject to this subchapter and standards of fill

of container for such articles not inconsistent with

any such standards established under the Federal

Food, Drug, and Cosmetic Act, and there shall

be consultation between the Secretary and the

Secretary of Health, Education, and Welfare prior

to the issuance of such standards under either

Act relating to articles subject to this chapter

to avoid inconsistency in such standards and pos-

sible impairment of the coordinated effective ad-

ministration of these Acts. There shall also be

consultation between the Secretary and an ap-

propriate advisory committee provided for in sec-

tion 661 of this title, prior to the issuance of such

standards under this chapter, to avoid, insofar

as feasible, inconsistency between Federal and State

standards.

(d) Sales under false or misleading name, other |

marking or labeling or in containers of misleading

form or size; trade names, and other marking,

labeling, and containers approved by Secretary.

No article subject to this subchapter shall be

sold or offered for sale by any person, firm,

or corporation, in commerce, under any name

or other marking or labeling which is false or

misleading, or in any container of a misleading

a

form or size, but established trade names and

other marking and labeling and containers which

are not false or misleading and which are ap-

proved by the Secretary are permitted.

(e) Use withholding directive respecting false or

misleading marking, labeling, or container; modi-

fication of false or misleading matter; hearing;

withholding use pending proceedings; finality of

Secretary's action: judicial review: application of

section 194 of Title 7.

If the Secretary has reason to believe that any

marking or labeling or the size or form of any

container in use or proposed for use with respect

to any article subject to this subchapter is false

or misleading in any particular, he may direct

that such use be withheld unless the marking,

labeling, or container is modified in such manner

as he may prescribe so that it will not be false

or misleading. If the person, firm, or corporation

using or proposing to use the marking; labeling

or container does not accept the determination

of the Secretary, such person, firm, or corporation

may request a hearing, but the use of the marking,

labeling, or container shall, if the Secretary so

directs, be withheld pending hearing and final

determination by the Secretary. Any such determi-

nation by the Secretary shall be conclusive unless,

within thirty days after receipt of notice of such

final determination, the person, firm, or corpora-

tion adversely affected thereby appeals to the

United States court of appeals for the circuit in

which such person, firm, or corporation has its

principal place of business or to the United States

Court of Appeals for the District of Columbia Cir-

2 ene De

— Ss

cuit. The provisions of section 194 of Title 7

shall be applicable to appeals taken under this

section.

' §624. Storage and handling regulations; violations;

exemption of establishments subject to non-Fed-

eral jurisdiction.

The Secretary may by regulations prescribe con-

ditions under which carcasses, parts of carcasses,

meat, and meat food products of cattle, sheep,

swine, goats, horses, mules, or other equines, capa-

ble of use as human food, shall be stored or

otherwise handled by any person, firm, or corpora-

tion engaged in the business of buying, selling,

freezing, storing, or transporting, in or for com-

merce, or importing, such articles, whenever the

Secretary deems such action necessary to assure

that such articles will not be adulterated or mis-

branded when delivered to the consumer. Viola-

tion of any such regulation is prohibited. How-

ever, such regulations shall not apply to the storage

or handling of such articles at any retail store

or other establishment in any State or organized

Territory that would be subject to this section

only because of purchases in commerce, if the

storage and handling of such articles at such

establishment is regulated under the laws of the

State or Territory in which such establishment

is located, in a manner which the Secretary, after

consultation with the appropriate advisory com-

mittee provided for in section 661 of this title,

determines is adequate to effectuate the purposes

of this section.

§ 678. Non-Federal jurisdiction of Federally reg- _

ulated matters; prohibition of additional or differ-

ee

a ee

ent requirements for establishments with inspection

services and as to marking, labeling, packaging,

and ingredients; recordkeeping and related require-

ments; concurrent jurisdiction over distribution for

human food purposes of adulterated or misbranded

and imported articles; other matters.

Requirements within the scope of this chapter

with respect to premises, facilities and operations

of any establishment at which inspection is pro-

vided under subchapter I of this chapter, which

are in addition to, or different than those made

under this chapter may not be imposed by any

State or Territory or the District of Columbia,

except that any such jurisdiction may impose rec-

ordkeeping and other requirements within the

scope of section 642 of this title, if consistent

therewith, with respect to any such establishment.

Marking, labeling, packaging, or ingredient re-

quirements in addition to, or different than, those

made under this chapter may not be imposed

by any State or Territory of the District of Colum-

bia with respect to articles prepared at any estab-

lishment under inspection in accordance with the

requirements under subchapter I of this chapter,

but any State or Territory or the District of

Columbia may, consistent with the requirements

under this chapter, exercise concurrent jurisdiction

with the Secretary over articles required to be

inspected under said subchapter I, for the purpose

of preventing this distribution for human food pur-

poses of any such articles which are adulterated

or misbranded and are outside of such an establish-

ment, or, in the case of imported articles which

are not at such an establishment, after their entry

—

into the United States. This chapter shall not

preclude any State or Territory or the District

of Columbia from making requirement or taking

other action, consistent with this chapter, with

respect to any other matters regulated under this

chapter.

Code of Federal Regulations, Title 9, Section 317.2.

(b) Any word, statement, or other information

required by this part to appear on the label must

be prominently placed thereon with such conspic-

uousness (as compared with other words, state-

ments, designs, or devices, in the labeling) and

in such terms as to render it likely to be read

and understood by the ordinary individual under

customary conditions of purchase and use. In order

to meet this requirement, such information must

appear on the principal display panel except as

otherwise permitted in this part.

(c) Labels of all products shall show the fol-

lowing information on the principal display panel

(except as otherwise permitted in this part), in

accordance with the requirements of this part or,

if applicable, Part 319 of this subchapter:

(4) An accurate statement of the net quantity

of contents, as prescribed in paragraph (h) of

this section:

(h)(1) The statement of net quantity of con-

tents shall appears on the principal display panel

of all containers to be sold at retail intact, in

conspicuous and easily legible boldface print or

type in distinct contrast to other matter on the

package and shall be declared in accordance with

ontiiinn i

the provisions of subparagraphs (2) through (10)

of this paragraph.

(2) The statement as it is shown on a label

shall not be false or misleading and shall express

an accurate statement of the quantity of contents

of the container exclusive of wrappers and packing

substances. Reasonable variations caused by loss

or gain of moisture during the course of good dis-

tribution prac

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