# Appendix — Alabama ex rel. Graddick v. Tennessee Valley Authority

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Appendix
- **Published:** January 1, 1981
- **Citation:** 454 U.S. 837

## Text

—

Office Supreme Court, U.S.

80 “2197 FILED
No, JUN .29 1981

DER L. STEVAS,
IN THE SUPREME COURT OF THE UNITED $TXPES crc

-—--

OCTOBER TERM, 1980

STATE OF ALABAMA, Ex Rel. Charles
A. Graddick, as Attorney General
of the State of Alabama,

Petitioner
Vv.
TENNESSEE VALLEY AUTHORITY, et al.,
Respondents
APPENDIX
(Volume I)

TO PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT

CHARLES A. GRADDICK
ATTORNEY GENERAL OF
THE STATE OF ALABAMA

EDWARD E. CARNES

ASSISTANT ATTORNEY
GENERAL OF THE STATE
OF ALABAMA

Counsel of Record

Office of Attorney
General
250 Administrative Bldg.
64 N. Union Street
Montgomery, Alabama
36130

(205) 834-5150

TABLE OF APPENDICES

App. No. Pg. No. Description
(Volume I)

A la District Court
Opinion

B 39a District Court
Order

Cc 42a Court of Appeals
Opinion

D 75a Court of Appeals

Judgment Entry

E 77a Court of Appeals
Order Denying
Rehearing

APPENDIX A
STATE OF ALABAMA ex rel. William
J. BAXLEY, as Attorney General of
the State of Alabama, Plaintiff,
Vv.
TENNESSEE VALLEY AUTHORITY,
Aubrey J. Wagner as Chairman of the
Board of Directors of the TVA, et al.,
Defendants.
Civ. A. No. 77-M-0377.
United States District Court,
N. D. Alabama, Northwestern Division.

Jan. 25, 1979.

MEMORANDUM OPINION
McFADDEN, Chief Judge.
The State of Alabama, on the relation of

its Attorney General, in this action against

the Tennessee Valley Authority, and its

board of directors (TVA), seeks a declara-

tion that Section 8(a) of the Tennessee

Valley Authority Act, 16 U.S.C. § 83lg(a)

requires TVA to locate its administrative

and executive offices at Muscle Shoals,

Alabama, and an injunction restraining TVA

la

from maintaining such offices at a place
other than Muscle Shoals. Jurisdiction
exists under 28 U.S.C. § 1331.

Pending before the court are cross-
motions for summary judgment. The issues
raised by these motions are whether
Alabama has standing to bring this action,
whether the suit is barred by the
doctrine of res judicata, and finally,
whether section 8(a) of the Act requires
TVA to locate its main offices at Muscle
Shoals, Alabama.

I. STANDING
Alabama alleges that it has standing to
bring this action in both its proprietary
capacity, and in its representative

capacity as parens patriae for its

citizens.

A. The State as Parens Patriae.

TVA first contends that Massachusetts v.

Mellon, 262 U.S. 447, 43 S. Ct. 597, 67

2a

L. Ed. 1078 (1923), denies Alabama

standing, in its parens patriae capacity,

to sue a federal agency:
While the state, under some circum-
stances, may sue for the protection of
its citizens, . .. it is no part of
its duty or power to enforce their
rights in respect of their relations
with the Federal Government. In that
field it is the United States, and not
the State, which represents them as
parens patriae.

Id. at 485-86, 43 S. Ct. at 600. Accord

South Carolina v. Katzenbach, 383 U.S.
301, 324, 86 S. Ct. 803, 15 L. Ed. 2d 769
(1966); Com. of Pa. by Shapp v. Kleppe,
174 U.S. App. D.C. 441, 533 F. 2d 668
(1976), cert. denied 429 U.S. 977, 97 S.
Ct. 485, 50 L. Ed. 2d 584 (1976).

In both Mellon and Katzenbach, the

plaintiff states challenged the constitu-

tionality of federal statutes. Standing

3a

in those circumstances would be "clearly
and obviously a fundamental threat to

the federal sovereign power." Com. of Pa.

by Shapp v. Kleppe, supra, 174 U.S. App.
D.C. at 455, 533 F. 2d at 682 (Lumbard,

J., dissenting). Alabama, however, "seeks
only to vindicate the will of the people
as it has been expressed by their duly
elected representatives in the national
legislature." Id. Therefore, the
federalism considerations present in those
actions are absent here. Compare Georgia
v. Pennsylvania R.R., 324 U.S. 439, 445,
65 S. Ct. 716, 89 L. Ed. 1051 (1945).

In Washington Utilities & Transp.
Com'r. v. F. C. C., 513 F. 2d 1142 (9th
Cir. 1975), cert. denied 423 U.S. 836,
96 S. Ct. 62, 46 L. Ed. 2d 54 (1975), the

court found this distinction to be dis-
positive and held that a state, through

one of its agencies, had parens patriae

standing to challenge federal agency action:

ha

WUTC does not attack the constitu-
tionality of the Communications Act
on any ground; rather, it relies upon
the federal statute and seeks to vindi-
cate the congressional will by
presenting what it asserts to be a
violation of that statute by the ad-
ministrative agency charged with its
enforcement.

Id. at 1153.

Other cases support parens patriae

standing in this case. In State of
Florida v. Weinberger, 492 F. 2d 488 (5th
Cir. 1974), the court held that Florida,

on behalf of its citizens, had standing
to challenge the Secretary of HEW's
power to enact certain regulations under
the Medicaid Act, 42 U.S.C. §1396A. In
State of New York v. United States, 65 F.
Supp. 856 (S.D.N.Y. 1946) (three-judge
court), affirmed 331 U.S. 284, 67 S. Ct.
1207, 91 L. Ed. 1492 (1947), the court

5a

found that the state had standing as parens
patriae to challenge an alleged misappli-
cation of a federal statute by the Inter-

state Commerce Commission.

In the court's view the rationale of

Massachusetts v. Mellon, supra, is not

applicable to the facts in the present
case cand there is no constitutional
barrier to Alabama acting as parens
patriae for its citizens.

There is, however, an inherent limita-
tion on the legitimacy of any action

brought by a state as parens patriae. In

Pennsylvania v. New Jersey, 426 U.S. 660,
96 S. Ct. 2333, 49 L. Ed. 2d 124 (1976),

the court noted that:
It has, however, become settled doctrine
that a State has standing to sue [as

parens patriae] only when its sovereign

or quasi-sovereign interests are im-

plicated and it is not merely litigating

6a

as a volunteer the personal claims of
its citizens.

Id. at 665, 96 S. Ct. at 2336.
Quasi-sovereign interests are impli-
cated where the injury for which redress
is sought affects the general welfare of

the state, or its citizens at large.
Kansas v. Colorado, 206 U.S. 46, 99, 27
S. Ct. 655, 51 L. Ed. 956 (1907);
Louisiana v. Texas, 176 U.S. 1, 19, 20
S. Ct. 251, 44 L. Ed. 347 (1900).

Alabama alleges that the location of TVA
at Muscle Shoals would benefit the general
welfare of its citizens and promote the
economic well-being of the state by the
creation of thousands of jobs in the
Muscle Shoals area, and the injection of
millions of dollars into the state
economy. The court is of the opinion
that these allegations are sufficient to
support a finding of injury to the quasi-
sovereign interests of Alabama.

7a

B. The Proprietary Interests of the
State.

Alabama's proprietary interests are
alleged to have been harmed by the loss of
tax revenues, the denial of a statutory
right conferred by section 8(a), and the
loss of honor and prestige resulting from
the failure of TVA to locate its head-
quarters at Muscle Shoals.

A state has at least the same right of
access to the court as any other institu-
tion to seek redress for injuries sustained

in its proprietary capacity. Com. of Pa.,

by Shapp v. Kleppe, supra. See also

Hawaii v. Standard Oil Company of Califor-
nia, 405 U.S. 251, 92 S. Ct. 885, 31 L. Ed.
2d 84 (1972).

The court agrees with the statement in
Com. of Pa., by Shapp v. Kleppe, supra,
174 U.S. App. D.C. at 445, 533 F. 2d at

672, that an "allegation that tax revenues
were reduced embodies a comprehensible

8a

harm to the economic interests of the

state government,” and therefore is of
the opinion that Alabama, in its
proprietary capacity, has alleged a
judicially cognizable claim for relief.

Compare, Massachusetts v. Mellon, supra,

at 485. Since only injunctive and de-
claratory relief is sought, the court need
not decide whether the alleged denial of

a statutory right or loss of honor and
prestige are redressable injuries.

C. Constitutional and Prudential Limi-

tations on Standing.

Having determined that the identity of
the parties is no bar to the adjudication
of the claims set forth in the complaint,
consideration must now be given to those
standing questions applicable to any suit
brought in a federal court.

Under article III of the Constitution of
the United States, the federal judicial
power extends only to "cases" or "contro-

versies". Muskrat v. United States, sts
a

U.S. 346, 356, 31 S. Ct. 250, 55 L. Ed.

246 (1911).
In terms of Article III limitations
on federal court jurisdiction, the
question of standing is related only
to whether the dispute sought to be
adjudicated will be presented in an
adversary context and in a form
historically viewed as capable of
judicial resolution.

Flast v. Cohen, 392 U.S. 83, 101, 88 S.

Ct. 1942, 1953, 20 L. Ed. 2d 947 (1968).

A recent exposition of the Supreme Court
concerning the Article III requisites of

standing is found in Duke Power Co. v.

Carolina Environmental Study Group, Inc.,
438 U.S. 59, 98 S. Ct. 2620, 57 L. Ed. 2d

595 (1978):

The essence of the standing inquiry
is whether the parties seeking to invoke
the court's jurisdiction have "alleged

such a personal stake in the outcome of

10a

the controversy as to assure that con-
crete adverseness which sharpens the
presentation of issues upon which the
court so largely depends for illumina-
tion of difficult constitutional
questions." Baker v. Carr, 369 U.S.
186, 204, 82 S. Ct. 691, 703, 7 L. Ed.
2d 663 (1962). As refined by subse-

quent reformulation, this requirement
of a "personal stake" has come to be
understood to require not only a
“distinct and palpable injury," to the
plaintiff, Warth v. Seldin, 422 U.S.
490, 501, 95 S. Ct. 2197, 45 L. Ed. 2d

343, but also a "fairly traceable"
casual connection between the claimed
injury and the challenged conduct.
Arlington Heights v. Metropolitan
Housing Corp., 429 U.S. 252, 261, 97 S.
Ct. 555, 50 L. Ed. 2d 450 (1977). See
also Simon v. Eastern Ky. Welfare Rights
Org., 426 U.S. 26, 41-42, 96 S. Ct. 1917,

lla

48 L. Ed. 2d 450 (1976); Linda R. S. v.
Richard D., 410 U.S. 614, 617, 93 S. Ct.
1146, 35 L. Ed. 2d 536 (1973).

Id. at 2630.

Prior to the submission of the pending
motions, the court granted TVA's request
for a protective order against answering
interrogatories seeking to discover the
number of persons employed by TVA and the
dollar amount of the payroll allocable to
them. TVA, however, has not disputed the
factual allegations of the complaint, and
properly recognizes that it is the nature
of the claimed injury, and not the amount
thereof which is relevant to the standing
inquiry. United States v. SCRAP, 412 U.S.
669, 689, n. 14, 93 S. Ct. 2405, 37 L. Ed.
2d 254 (1973).

It is common knowledge that the presence
of the headquarters of an organization
the size of TVA would generate tax reve-

nues directly and indirectly to the state

12a

and have a significant economic impact
on the state. Clearly, the absence of
the jobs the headquarters would provide
and money thereby generated from
Alabama's economic system is a "direct
and palpable injury" to its quasi-
sovereign interest in the general welfare

of its citizens.

The court finds, therefore, that Ala-

bama, as parens patriae for its citizens,

and in its own right as an entity
possessing proprietary interest, has
satisfied the "direct injury" test for
standing under article III.

The other article III requirement for
standing is a showing that there is "a
"substantial likelihood’ that the relief
requested will redress the injury claimed.”

Duke Power Co. v. Carolina Environmental

Study Group, Inc., supra, 98 S. Ct. at

2631 n. 20. See also, Regents of the
University of California v. Bakke, 438
13a

U.S. 265, 98 S. Ct. 2733, 2743 n. 14, 57
L. Ed. 2d 750 (1978). There is no doubt
that a judicial decree requiring TVA to
locate its headquarters at Muscle Shoals
will result in the influx of jobs and
dollars into the state economy, and will
result in increased tax revenues for the
state. The court is of the opinion that
the "redressability" requirement has been
met.

TVA has steadfastly asserted that Ala-
bama must also #emonstrate that its inter-
ests which have been injured are within
the "zone of interests" meant to be pro-

tected by the TVA Act, citing Data Pro-

cessing Service v. Camp, 397 U.S. 150,

90 S. Ct. 827, 25 L. Ed. 2d 184 (1970),
and Flast v. Cohen, 392 U.S. 83, 88 S. Ct.
1942, 20 L. Ed. 2d 947 (1968).

Some commentators have questioned the
continued validity of the "zone of

interests" test. See, e.g., K. Davis,

l4a

Administrative Law of the Seventies,
.§22.02-11, at 184-187 (1978 Supp.);
Sedler, Standing Justiciability, and All

That: A Behavioral Analysis, 25 Vand.
L. Rev. 479, 486 (1972). An analysis of

the opinion in Duke Power Co. v. Carolina

Environmental Study Group, Inc., supra,

strongly suggests that that test has been
abandoned. In Duke, the defendants
argued that in order to have standing, the
plaintiffs should have been required to
demonstrate a connection Between the rights
being asserted and the injuries suffered.
The court declined to apply a Flast-type
nexus test and held:
We . . . cannot accept the contention
that, outside the context of taxpayers'
suits, a litigant must demonstrate any-
thing more than injury in fact and a
substantial likelihood that the judicial
relief requested will prevent or redress

the claimed injury to satisfy the "case

15a

or controversy" requirement of Art.
IIl.
98 S. Ct. at 2634.

In the court's opinion, Alabama has
satisfied the article III requirements
for standing.

TVA's final objection to Alabama's
standing to bring this action is that the
injuries it complains of are no more than
generalized grievances which are equally
shared by all citizens of the United
States, and therefore fall within the pru-
dential limitations on the exercise of
federal jurisdiction. See Warth v. Seldin,
422 U.S. 490, 95 S. Ct. 2197, 45 L. Ed.
2d 343 (1975); Schlesinger v. Reservists
to Stop the War, 418 U.S. 208, 94S. Ct.
2925, 41 L. Ed. 2d 706 (1974); United
States v. Richardson, 418 U.S. 166, 94
S. Ct. 2940, 41 L. Ed. 2d 678 (1974).

The Supreme Court, however, has recently

de-emphasized the prudential limitations

l6a

on the classes of persons who may

properly challenge governmental action:
Where a party champions his own rights,
and where the injury alleged is a
concrete and particularized one which
will be prevented or redressed by the
relief requested, the basic practical
and prudential concerns underlying the
standing doctrine are generally
satisfied when the constitutional requi-
sites are met. (Citations omitted)

Duke Power Co. v. Carolina Environmental

Study Group, Inc., supra, 98 S. Ct. at
2634.

Regardless of the weight to be given to
general prudential concerns, it appears
to the court that TVA has perhaps mis-
construed the nature of the grievance
asserted by Alabama. The fact that all
national citizens have an idealogical
interest in a federal agency's compliance

with the law, First National Bank v.

17a

Missouri, 263 U.S. 640, 666-67, 44S. Ct.
212, 68 L. Ed. 486 (1924) (Van Devanter,

J. dissenting), does not preclude a
readily identifiable portion of that
citizenry from asserting a distinct and
particularized harm. Alabama has shown
interests which are sufficiently apart
from a generalized interest in good govern-
ment to overcome any duty on the part of
this court to stay its hand on prudential

grounds.

II. RES JUDICATA

TVA has interposed the judgment of the

court in Frahn v. Tennessee Valley Au-

thority, 41 F. Supp. 83 (N.D. Ala. 1941),
as a bar to the present suit. In that
case, an action was brought against TVA
by citizens and taxpayers of the Muscle
Shoals area, on behalf of themselves and
others similarly situated, seeking a

declaration that TVA was violating section

18a

8(a) of the TVA Act by not locating its
- general headquarters at Muscle Shoal;.

Alabama maintains that Frahn does not
preclude this action fortwo reasons: (1)
the section 8(a) issue was not decided
there, and (2) the State of Alabama was not
a party to that case.

The court in Frahn held that it lacked
jurisdiction to interpret section 8(a)
because the complaint failed "to present
a justiciable controversy."" 41 F. Supp.
at 86. In reaching this conclusion the
court found that the plaintiffs lacked
standing to bring the action, and that the
interpretation placed on section 8(a) by
TVA was not so unreasonable as to require
judicial interference. Alabama argues
that the holding of non-justiciability
encompasses only the lack of standing,
and the finding that the interpretation
of section 8(a) was committed to adminis-

trative discretion is dictum.

19a

The court is of the opinion that this is
true and that Judge Murphree's finding of
lack of a justiciable controversy was based
on the lack of standing. If plaintiffs
lacked the standing to bring the action,
the court's comments with respect to the
statutory interpretation question were dic-
tum. However, even if, as TVA contends,
the decision was based on two grounds—
standing and the lack of power to contest
the discretion of the executive officers of
the government in respect to the interpre-
tation of the statutes—this action is not
necessarily precluded by Frahn. Alabama
could not be bound by that judgment under

res judicata principles unless it was a

party to the proceeding. Zenith Radio Corp.

v. Hazeltine Research, Inc., 395 U.S. 100,
89 S. Ct. 1562, 23 L. Ed. 2d 129 (1969);
State of Texas v. Chuoke, 154 F. 2d 1 (5th
Cir. 1946), cert. denied 329 U.S. 714, 67
S. Ct. 45, 91 L. Ed. 620 (1946).

20a

TVA does not pretend that Alabama was

. a named plaintiff in Frahn, but maintains

that it should be bound by the judgment
there because Frahn was a class action on
behalf of all Alabama citizens. The
court cannot accept this contention. Be-
sides the absence of any indication that
a plaintiff class was ever certified by
the Frahn court, in the present action
Alabama has sued on its own right,
asserting injury to its proprietary and
quasi-sovereign interests. The court is
of the opinion that these interests are
not so identical to those of the putative
class of plaintiffs in Frahn as to make
the judgment in that case a bar to the
present proceedings even if the question
was there decided. Compare Dufee v. Duke,
375 U.S. 106, 84S. Ct. 242, 11 L. Ed. 2d
186 (1963).

2la

III. THE "PRINCIPAL OFFICE" PRO-
VISION OF SECTION 8(a)

Section 8(a) of the Tennessee Valley Au-
thority Act of 1933, 16 U.S.C. § 83lg(a),
provides:

The Corporation shall maintain its
principal office in the immediate vi-
cinity of Muscle Shoals, Alabama. The
Corporation shall be held to be an in-
habitant and resident of the northern
judicial district of Alabama within the
meaning of the laws of the United States

relating to the venue of civil suits.

Alabama contends that this provision
requires TVA to locate its administrative
and operatioi.11 headquarters at Muscle
Shoals. TVA submits that section 8(a)
only requires that it maintain an office
to accept service of process at Muscle
Shoals. This is essentially what TVA does,

with its administrative and operational

22a

headquarters being maintained elsewhere,
_ principally in Knoxville, Tennessee.

As a threshold matter, the court must
deal with TVA's assertion that it has
discretion tointerpret the meaning of
the principal office provision. The
asserted TVA grant of discretion to choose
the location of its headquarters is
based on Section 3 of the Act, which au-
thorizes the Board to:

appoint such managers, assistant mana-

gers, officers, employees, attorneys,

and agents as are necessary for the

transaction of business .. . and pro-

vide a system of organization to fix

responsibility and promote efficiency.
16 U.S.C. § 831b.

The court is not persuaded by this argu-
ment. In Morton v. Ruiz, 415 U.S. 199,
94S. Ct. 1055, 39 L. Ed. 2d 270 (1974),

the court noted that the Secretary of the

Interior had by statute, been granted

23a

broad managerial authority over Indian
affairs. Id. at 231 n. 26, 94S. Ct.
1055. However, the court rejected the
administrative interpretation of the
statute in question, holding that in order
for an agency interpretation to be granted
deference it must be consistent with the
congressional purpose. Id. at 237, 94

S. Ct. 1055.

The principle of judicial deference to
the interpretation given a statute by
those charged with its enforcement has
long been recognized. See, e.g., Red
Lion Broadcasting Co. v. F. C. C., 395
U.S. 367, 89 S. Ct. 1794, 23 L. Ed. 2d 371
(1969); Zemel v. Rush, 381 U.S. 1, 85 S.
Ct. 1271, 14 L. Ed. 2d 179 (1965);
Houghton v. Payne, 194 U.S. 88, 24S. Ct.
590, 48 L. Ed. 888 (1904). However, a

court will not defer to the administrative
construction where it is shown that such

construction is not in accordance with

24a

the Congressional intent behind the

statute. Morton v. Ruiz, supra;

Espinoza v. Farah Manufacturing Co., Inc.,
414 U.S. 86, 94S. Ct. 334, 38 L. Ed. 2d
287 (1973); Houghton v. Payne, supra. And

where the dispute concerns the meaning of
a statutory term as opposed to a policy
decision requiring exercise of an agency's
expertise, the courts will not abdicate
their primary function of interpreting
the law. Barlow v. Collins, 397 U.S.

159, 90 S. Ct. 832, 25 L. Ed. 2d 192
(1970); Texas Gas Transmission Corp. v.
Shell Oil Co., 363 U.S. 263, 80S. Ct.
1122, 4 L. Ed. 2d 1208 (1960).

The phrase “principal office" is a
legal term of art, and its correct in-
terpretation is a matter for judicial
determination. Congress is presumed to
know the judicially established meaning
of the words it uses in statutory pro-

visions. United States v. Merriam, 263

25a

U.S. 179, 44 S. Ct. 69, 68 L. Ed. 240
(1923).

The primary rule of statutory construc-
tion is to ascertain and effectuate the
legislative intent. 2A Sands, Sutherland
Statutory Construction, § 45.05, at 16
(4th ed. 1973). And where a statute is

unambiguous, this can be accomplished by
examination of the language adopted by
the legislature. Caminetti v. United
States, 242 U.S. 470, 37 S. Ct. 192,

61 L. Ed. 442 (1917).

Alabama asserts that no ambiguity exists
in the language of section 8(a), and that
the term "principal office" clearly
means the main headquarters of a corpora-
‘ tion. See, e.g., Peters v. Detroit &
Cleveland Nav. Co., 24 F. 2d 454 (W.D.
N.Y. 1927); Caceres v. United States

Shipping Bd. Emergency Fleet Co., 299 F.
968 (E.D.N.Y. 1924); Mason & Hanger Co.
v. Sharon, 231 F. 861 (2d Cir. 1916),

26a

cert. denied 241 U.S. 670, 36 S. Ct.

‘554, 60 L. Ed. 1230 (1916); Oleck,

Modern Corporation Law, § 461, at 705
(1958). TVA, however, argues that the
term "principal office," when used in the
corporate context, refers to an address
for service of process. There is some
authority for this position. See, e.g.,
40 Op. Atty. Gen. 115 (1941); 18 C.J.S.
Corporations § 177 (1939); 8 W. Fletcher,
Cyclopedia of the Law of Private Corpora-
tions 14046, at 483-84 (1966); Oleck,

Modern Corporation Law, supra, § 3, at 13.

The court, nevertheless, is of the view
that the language of the statute is plain
and unambiguous and that it clearly means
the main headquarters of the corporation,
particularly when read in conjunction
with section 2(e) of the TVA Act, 16
U.S.C. § 83la(e), which provides:

Each of the members of the board shall

be a citizen of the United States, and

27a

shall receive a salary at the rate of
$10,000 a year, to be paid by the
Corporation as current expenses. Each
member of the board, in addition to his
salary, shall be permitted to occupy
as his residence one of the dwelling
houses owned by the Government in the
vicinity of Muscle Shoals, Alabama, the
same to be designated by the President
of the United States. Members of the
board shall be reimbursed by the Cor-
poration for actual expenses (including
traveling and subsistence expenses)
incurred by them in the performance of
the duties vested in the board by this
Act [16 USCS § 831 et seq.]. No member
of said board shall, during his continu-
ance in office, be engaged in any other
business, but each member shall devote
himself to the work of the Corporation.
82 C.J.S. Statutes, § 345, at 699-700
(1953), states:

28a

In construing a statute, the inten-
tion or purpose of the legislature, or
the meaning of a statute is to be
determined, not from any single part,
portion or section. . . or from
particular or specific expressions or
terms .. . but from a general con-
sideration or view of the act as a
whole or in its entirety. (Footnotes
omitted)

And wherever reasonable, the court will
adopt that construction which gives
effect to all provisions of the statute.

Meltzer v. Board of Public Instruction of

Orange County, Fla., 548 F. 2d 559 (Sth
Cir. 1977); 2A Sands, Sutherland

Statutory Construction, supra, § 46.06.

It is apparent to the court that the
free residence provision of section 2(e)
would be meaningless if section 8(a)
were construed to allow TVA to locate its
main headquarters at a place distant from

Muscle Shoals.
29a

Assuming, however, that the language is
ambiguous, the legislative history pre-
ceding the enactment of the TVA Act of
1933 also points to the conclusion that
Congress intended the headquarters of
TVA to be located at Muscle Shoals.

The pre-enactment remarks of Senator
Norris, the co-author of the TVA Act,
clearly indicate that the free residence
was intended to be a salary supplement for
TVA directors:

I realize that there is very much dis-

agreement as to whether we could get a

man for $9,000 or $10,000 who could

fill this place. I am of the opinion
that we could. I do not believe there
would be any difficulty. If a member
of the board desires to live in Muscle

Shoals—and I think it is a beautiful

place to live—he would have his house

rent free, in addition to his salary.

77 Cong. Rec. 2687 (1933).

30a

Although never enacted into law be-
cause of Presidential veto, the Muscle
Shoals Act of 1928, H.R. 7744, 70th
Cong., lst Sess. (1927), and the Muscle
Shoals Act of 1931, S.J. Res. No. 49,
71st Cong., 3d Sess. (1931), both sought
to establish the Muscle Shoals Corpora-
tion of the United States to oversee the
federal government's investment in
nitrate and electrical plants located at
Muscle Shoals. Section 7(a) of both
acts contained language identical to that
which was eventually enacted as section
8(a) of the TVA Act of 1933.

Lister Hill was a member of the House
Committee on Military Affairs which
drafted the 1928 Act. H.R. Rep. No. 1095,
70th Cong., lst Sess. (1928). He later
testified concerning the purpose of the
principal office provision:

The idea and the purpose of the

committee in putting that language in
3la

the bill was that the actual head-
quarters, that those whose business

it was to carry on the permanent work,
to set the policies, to be the chiefs
and the heads, should have their office
at Muscle Shoals, Ala.

And in that connection, let me say
that back in 1928 the Committee on
Military Affairs of the House had a
full picture of the situation, in many
ways, just about as full as we have
today, for this reason; that the
engineers, the Army Engineers, at that
time had completed the finest and most
detailed survey of the Tennessee River
that has ever been made of any river
in the whole world, and we had that
survey of the engineers before us at
the time we put this langauge in the
bill.

We knew what we were doing; we knew

what we wanted to do. We had the facts

32a

that Senator Bankhead has given us
this morning about the geographical
importance; the fact that after all is
said and done, Muscle Shoals is, so to
speak, the center of gravity of any
activity in that whole great valley.

All of the facts showed that Muscle
Shoals was a logical place, that it was
a feasible place, and that economy and
efficiency dictated that the head-
quarters be placed there.

I was a member of the Committee on
Military Affairs when that language was
written into the bill. .. . Hearings

Before the Joint Committee on the Inves-

tigation of the Tennessee Valley Au-

thority, 75th Cong., at 5224 (1938).

Although the Muscle Shoals Act of 1928
was never enacted into law, given the
identity of the language of its princi-

pal office provision to that of section

33a

8(a) of the TVA Act, it is fair to infer
that the comments of Representative Hill
are equally applicable to both pro-
visions. Compare FEA v. Algonquin Sng.,
Inc., 426 U.S. 548, 652-64, 96 S. Ct.
2295, 49 L. Ed. 2d 49 (1976). And since

Senator Norris and Representative Hill
were co-sponsors of the TVA Act, their
statements are entitled to great weight,
even though Alabama, represented by
Representative Hill, stood to benefit
from their reading of the statute. Id.
at 564 n. 17, 96 S. Ct. 2295.

TVA places great reliance on the conclu-

sion reached in the Report of che Joint

Committee on the Investigation of the

Tennessee Valley Authority, 76th Cong.,
lst Sess. 9 (1939):
The committee finds that the Authority

has legally complied with that part of
subsection (a) of section 8 of the

act, as amended, which requires that

34a

the principal office of the Authority

be maintained in the immediate vicinity

of Muscle Shoals, Ala. However, on
account of the substantial difference
of opinion on the question, the
committee recommends that, in view of
the approaching completion of the dams,

Congress give immediate consideration

to clarifying the issue.

Three members of tie nine-man committee
disagreed with the majority report on
this issue and concluded that TVA's
maintenance of its headquarters in
Knoxville was "a palpable violation of
this mandatory provision of the TVA Act."
Id. at 331.

The result reached by this committee,
along with the fact that Congress has never
amended section 8(a), argues TVA, con-
stitutes express approval of its inter-
pretation of the principal office

provisions. The Supreme Court has noted,

35a

however, that "[t]he views of a subse-
quent Congress form a hazardous basis for
inferring the intent of an earlier one."
United States v. Philadelphia Nat'l Bank,
374 U.S. 321, 348-49, 83 S. Ct. 1715,
1733, 10 L. Ed. 2d 915 (1963), quoting
United States v. Price, 361 U.S. 304, 313,
80 S. Ct. 326, 4 L. Ed. 334 (1960). See
also, Teamsters v. United States, 431 U.S.
324, 97 S. Ct. 1843, 52 L. Ed. 2d 396
(1977).

TVA further supports its argument that

the administrative interpretation is in
accordance with the Congressional intent
by pointing out that Congress has con-
tinued to appropriate funds to maintain
TVA offices not located in Muscle Shoals,
and in fact has specifically refused to
appropriate funds for the purpose of re-
locating TVA offices. Act of July 27,
1953, Ch. 241, 67 Stat. 190.

The Supreme Court, however, has recently

36a

cautioned against reliance on subsequent
appropriation acts in determining the
intent of the legislature which enacted
the underlying statute. Tennessee Valley
Authority v. Hill, 437 U.S. 153, 98 S. Ct.
2279, 2299-2300, 57 L. Ed. 2d 117 (1978).

Moreover, the probative value of appro-
priation measures here diminishes in view
of the fact that Congress has refused to
pass proposed permanent amendments to
section 8(a) which would have eliminated
Muscle Shoals as the situs of the princi-
pal office. See S. 1207, 79th Cong.,

lst Sess. (1945), and H.R. 4146, 83d
Cong., lst Sess. (1953).

As was noted earlier in this opinion,
the long-standing administrative inter-
pretation of section 8(a) is to be
accorded great weight in seeking to
determine the proper construction of the
Act. But is equally clear that it is not

the controlling consideration:

37a

Contemporaneous and practical inter-
pretation serve as another aid of
statutory construction, and therefore
must be weighed against the other
factors pertinent to the determination
of legislative intent.

2A Sands, Sutherland Statutory Construc-

tion, supra, § 49.04, at 235.

The court is of the view that the plain
reading of the statute requires a finding
that Congress fully intended the primary
administrative and operational head-
quarters of TVA to be located in the
Muscle Shoals area. The court is further
of the view that even if the language
were to be considered ambiguous, the em-
ployment of other means of statutory
interpretation dictates the same result.

Accordingly, TVA's motion for summary
judgment is due to be denied and that of
the plaintiff granted.

38a

APPENDIX B
IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF ALABAMA
NORTHWESTERN DIVISION

STATE OF ALABAMA, EX
REL. WILLIAM J.
BAXLEY

Plaintiff

TENNESSEE VALLEY

)
3
-v- ‘ C.A. 77-M-0377
AUTHORITY et al.

)

Defendants

ORDER

This cause came to the court on the
following motions:

(1) The motion of defendants to
dismiss the original complaint or, in thé
alternative, for summary judgment;

(2) The motion of defendants to dis-
miss the amended complaint or, in the
alternative, for summary judgment; and

(3) The motion of plaintiff for

summary judgment.

39a

Defendants’ second motion renders
moot their first motion. Accordingly,
it is hereby ORDERED that defendants’
motion to dismiss the original complaint
or, in the alternative, for summary
judgment is overruled.

In accordance with the memorandum
opinion entered contemporaneous ly:

It is hereby

ORDERED, ADJUDGED and DECREED that
the motion of defendants to dismiss the
amended complaint or, in the alternative,
for summary judgment is overruled;

It is further ORDERED that the
motion of plaintiff for summary judgment
is granted;

It is further ORDERED, ADJUDGED and
DECLARED that defendants are required by
law to locate and maintain the head-
quarters of the Tennessee Valley Authority
in the immediate vicinity of Muscle
Shoals, Alabama, and that defendants have

40a

failed to do so;

It is further ORDERED that defendants
are enjoined from locating or maintaining
the headquarters of the Tennessee Valley
Authority in any place other than in the
immediate vicinity of Muscle Shoals,
Alabama.

Costs are hereby taxed to defendants.

Done this 25th day of January, 1979.

/s/ Frank H. McFadden
ef Judge

4la

APPENDIX C

STATE OF ALABAMA ex rel. Charles
A. GRADDICK, as Attorney General
of the State of Alabama, Plaintiff-
Appellee,

v.

TENNESSEE VALLEY AUTHORITY
et al., Defendants-Appellants.

No. 79-1283.

United States Court of Appeals,
Fifth Circuit.

Feb. 13, 1981.

Appeal from the United States
District Court for the Northern District
of Alabama.

Before GEE, FAY and RANDALL, Circuit
Judges.

GEE, Circuit Judge:

The Tennessee Valley Authority (''TVA"
or “Authority") appeals from an order of
the United States District Court for the
Northern District of Alabama requiring
that its "headquarters" in Knoxville,
Tennessee, be packed up and moved to Muscle

Shoals, Alabama. The district judge found

42a

this relocation necessary to bring TVA
into compliance with section 8(a) of the
Tennessee Valley Authority Act of 19335,
16 U.S.C. § 83lg(a), which reads in
pertinent part: "The corporation shall
maintain its principal office in the
immediate vicinity of Muscle Shoals,
Alabama."1

Since its creation by act of Congress
in 1933, the TVA has maintained offices in
a number of locations, including Knoxville,
Chattanooga, Muscle Shoals, and Washington,
D.C., in order to facilitate performance
of its statutory purposes. It is undis-
puted that the central administration of
the corporation has been located from its

earliest days in Knoxville. Members of

lthe full text of the section runs:
"The corporation shall maintain its princi-
pal office in the immediate vicinity of
Muscle Shoals, Alabama. The corporation
shall be held to be an inhabitant and resi-
dent of the Northern Judicial District of
Alabama within the meaning of the laws of
the United States relating to the venue of
civil suits."

43a

the board of directors maintain their
offices in Knoxville; most of their
meetings are conducted there; the
central offices and directors of a number
of the corporation's major divisions are
located there. A smaller office is main-
tained in Muscle Shoals; the administra-
tive staffs of several divisions are
located there. The TVA makes no pretense
that these Alabama activities comprise
those that would be carried on at the
administrative headquarters of a corpora-
tion.

Dissatisfied with this arrangement,
the State of Alabama filed suit in 19772
to force the TVA to relocate its central

administration in Muscle Shoals. In lieu

2The TVA did not assert the equitable
defense of laches to Alabama's suit for
injunctive relief, and thus that affirma-
tive defense is unavailable as a possible
ground of decision here. Beyond noting
tue passage of 44 years between the
establishment of the headquarters in Knox-
ville and the filing of this lawsuit, this
court will not further consider that delay.

44a

of an answer to this complaint, the TVA

. filed a motion for summary Jodment.”

Alabama filed a cross motion for summary
judgment, which was granted by the court.
In a January 25, 1979, order the judge en-
joined the TVA “from locating or main-
taining the headquarters of the Tennessee
Valley Authority in any place other than
in the immediate vicinity of Muscle Shoals,
Alabama."" It is from this order of the
district court that TVA now appeals.

Two of the grounds for reversal urged

by TVA need delay us only slightly, for we

3The TVA proposed several grounds for
summary judgment in its motion, arguments
raised — on appeal as grounds for re-
versal of the adverse trial court judgment:
(1) that Alabama lacked standing to assert
TVA's alleged non-compliance with the
statutory provision on location of its
“principal office"; (2) that Frahn v. TVA,
41 F. Supp. 83 (N.D. Ala. 1941), an un-
successful challenge. to the Knoxville loca-
tion earlier lodged by Alabama citizens,
was res judicata of this pon by the
state; an that the term "principal
office" referred solely to a formal corpo-
rate office, denominated in the Act simply
as a place for receipt of service of
process, a location where the elusive cor-
porate entity could always be found.

45a

find that the court below correctly dis-
posed of TVA's arguments on these points.
That finding is slim confort to appellee,
for the judgment falls anyway on the

third ground, discussed in detail below.

The Authority's assertions that
Alabama lacked standing and that the
state's claim was barred by the earlier

decision in Frahn v. TVA, 41 F. Supp. 83

(N.D. Ala. 1941), were sufficiently dealt
with below. The amicus brief filed with
this court by the State of Tennessee
urging reversal is itself an eloquent
evocation of Alabama's alleged injury in
fact; the injury is certainly sufficient
to insure that there exists the concrete
adverseness of positions necessary to
proper clarification of the issues.
Alabama has standing to challenge the TVA's
actions here. In Frahn a group of Alabama
residents filed suit to remedy what they

considered the TVA's intransigent refusal
46a

to obey the law. The district judge

‘ granted the Authority's Rule 12(b) (6)
motion on the ground that these private
individuals lacked standing to complain

of TVA's behavior. The court additionally
remarked that the determination of place-
ment of its corporate headquarters was
properly left to the TVA. The Authority's
attempt to skewer Alabama on language in
Frahn, even if this court were to find

the substantive issue involved in this

case there to have been resolved, must
fail. Alabama was neither a party to the
earlier lawsuit, nor is there an identity
of interest with those individuals who
were plaintiffs. In addition to its parens
patriae interest, which arguably can be no
different substantively from that of its
citizens, the state asserts a proprietary
interest distinct from that of any individ-

ual or group of its citizens.

47a

Our findings that the district judge
sufficiently resolved difficult questions

of standing and res judicata can give

Alabama only brief solace; fully entitled
to bring this lawsuit, the state is not,
however, entitled to prevail. The sole
question for decision here, correctly
recognized by the district court, is the
meaning of the "principal office" pro-
vision of 16 U.S.C. § 83lg(a). Summary
judgment was thus the appropriate reso-
lution of this matter; the victory simply
went to the wrong contestant. This court
must now consider the legal effect of the
statutory requirement that the TVA main-
tain its "principal office in the immediate
vicinity of Muscle Shoals, Alabama."
Contrary to Alabama's assertions,
this court finds the "plain meaning" of
the statutory language not to be all that
plain. That application of a dictionary

to the phrase necessarily results in the

48a

conclusion that certain (but not all)

' administrative functions of the Authority
should properly exist only in Muscle
Shoals is not ineluctably clear. As a
legal term of art (if such it be),
“principal cffice" lacks a certain
definiteness in its connotation; courts
and commentators confuse and differently
distinguish phrases such as "principal
office," "registered office," and

“principal place of business."

Confronted with a provision the
reading of which we find ambiguous, this
court must turn to familiar but neverthe-
less slippery tools of statutory construc-

tion. Before doing so, however, it is

4vhe comment to the revised Model
Business Corporations Act indicates that
confusion between the various terms typi-
cally used in state corporation laws
prompted the drafters to settle on
‘registered office" as the favored term
for the office named in the corporate
pros fa as a place where the corporation
could always be found.

49a

important to clarify what this exercise
must entail. The TVA asserts that what-
ever the phrase actually means, the Au-
thority's consistent forty-year reading
of it is a reasonable one and that proper
judicial deference to agency expertise
would prompt this court to leave the
reasonable interpretation undisturbed.
That deferential solution would spare
this court much of the following exercise
and for that reason, among others, is a
facially attractive one. That conclusion
is, however: fundamentally flawed. The
proposition the TVA here urges is appro-
priate in situations where the agency's
challenged action in some way implicates
its special expertise. Cf. Young v. TVA,
606 F. 2d 143, 145 (6th Cir. 1979)

(question of TVA authority to construct
power plant outside watershed of Tennessee
River; agency construction of statutory

provision upheld in part because "[t]he

50a

construction and operation of power plants
‘and the distribution of electric energy
generated therefrom requires expertise
which should be accorded deference by

the courts"). This court is hard pressed
to arrive at reasons why the TVA's inter-
pretation of a purely legal point here
should be accorded any weight at all, much
less rendered the deference suggested.

Cf£. Coca-Cola Co. v. Atchison, Topeka &
Santa Fe Railway Co., 608 F. 2d 213, 222
(5th Cir. 1979) ("[nJevertheless, even

where the issue is one of pure law, such
as interpretation of contracts, tariffs,
regulations and statutes, room still is
present for deference to the views of ad-

ministrative agencies, particularly where

the understanding of the problem is en-

hanced by the agency's expert understanding

of the industry" (emphasis added)).

Congress did not commit to the TVA's judg-

ment the location of its principal office;

5la

that decision is chiseled in stone at

16 U.S.C. § 83lg(a). If this court were
to arrive at the legal determination that
"principal office" meant administrative
headquarters, then, absent congressional

amendment of that provision,” the reason-

ableness of TVA'’s error could not save it
from Muscle Shoals. The question is
properly one for the court to decide, and
so we turn to it. We conclude that TVA's
interpretation of the "principal office"
provision is not only reasonable, it is

correct.

5A number of proposed amendments to
§ 8(a) have surfaced over the years, only
to slip quietly back beneath the waves of
congressional indifference. The most recent
proposal was apparently in direct response
to the district court opinion in this case.
See S. 757, 96th Cong., lst Sess. 125 Cong.
Rec. S. 3347 (1979), and H.R. 1595, 96th
Cong., lst Sess. 125 Cong. Rec. 339 (1979).
This Court has been made aware of no favor-
able action on this amendment that perhaps
would render the dispute moot.

52a

As suggested above, courts and com-
‘mentators can be found falling on both
sides of this definitional dispute; no
attempt will here be made to cast these
into respective measures and to determine
the "weight" of authority. The sources
that, however, helped lead us to our
reading of the term in its context will
be briefly noted and qualified.

The major corporate law treatises do
not offer a united front. Compare 1 H.
Oleck, Modern Corporate Law § 3 at 13
(1958) ("'Principal office' means the
place stated in the articles or certificate
of incorporation as the address of the
corporation."), with 8 W. Fletcher,
Cyclopedia of the Law of Private Corpora-
tions § 4035 at 458 (1966) ("The words

"principal office’ have a definite meaning,
especially when applied to a corporation,
in which case they mean the head office,
the place where the principal officers

53a

generally transact business and the place
to which reports are made and from which
orders emanate."'). The above formulations
need not be mutually exclusive. A cor-
poration's central headquarters, "from
which orders emanate," could well be the
office listed, in the charter as the formal
address of the entity. But it need not
be; and as pointed out by the TVA, in
common practice it frequently is not the
same location. The Delaware corporation
law statute for many years required
businesses incorporating under its pro-
visions to maintain a "principal office or
place of business" within the state.°
This popular incorporating state was never
inundated with actual corporate head-
quarters because of this statutory require-

ment. No independent tabulation of now-

6The Delaware statute, following the
suggestion of the revised MBCA, see note
4, supra, now speaks of a "registered
office.

54a

outdated state corporation laws was
‘attempted by this court, but as computed
by the TVA (and undisputed by Alabama), 27
states' statutes in that period required the
listing of a "principal office" in corporate
charters. Neither legislators nor
certainly corporate officers considered
the statute further to require the location
of any particular corporate activity, ad-
ministrative or otherwise, at that address.
In the pursuit of some insight into
understandings of the elusive term
“principal office," a survey of case law
prior to and contemporary with the passage
of the TVA Act produces mixed results.
Much of the case law on the meaning of
"principal office" is concerned with dis-
tinguishing it in the particular context
from the “principal place of business" of
the subject corporation. That exercise is
not particularly helpful here, as the

district court order does not require, nor

55a

does Alabama seek, the shifting of the
majority of the dam construction, flood
control, and electrical generating activi-
ties of the TVA to the "immediate vicinity
of Muscle Shoals"; rather, the relocation
of the administrative headquarters, which
can be and often is distinct from the
corporation's principal place of business,

has been ordered.

When a word has a judicially settled
meaning, it is presumed that Congress,
by using that word in a statute, used it
in that accepted sense. United States v.
Merriam, 263 U.S. 179, 187, 44S. Ct. 69,
71, 68 L. Ed. 240 (1923). The meanings

here urged by the respective parties are

not, however, judicially settled. In
Caceres v. United States Shipping Board
Emergency Fleet Corp., 299 F. 968, 970
(E.D.N.Y. 1924), the court distinguished

“principal office" and "principal place

of business" with the definition now
56a

immortalized in Fletcher's: "The words
‘principal office’ have a definite
meaning, especially when applied to a
corporation, in which case they mean the
head office, the place where the principal
officers generally transact business, and
the place to which reports are made and
from which orders emanate." Unsurprisingly,
Alabama fastens on this and similar formu-
lations as the correct judicial settlement
of meaning. Dicta in a bankruptcy case
decided by this court, however, offer
support to TVA's position. In Dryden v.
Ranger Refining & Pipe Line Co., 280 F.
257 (5th Cir. 1922), the court had to

determine the "principal place of business"
of the bankrupt for jurisdictional pur-
poses. Most of the corporate activity was
centered in and around Ranger, Texas. The
“general offices" of the company (described
in the opinion as the administrative

headquarters of the corporation) were in

57a

Kansas City, Missouri. Ranger Refining
was a Delaware corporation with its
"principal office in Wilmington, Delaware."
Id. at 257-58. The case was found
properly to belong in the Northern

District of Texas, which included the

town of Ranger, and not in the locations

of either the general offices or the

"principal office."

The central question in statutory
interpretation is, of course, what meaning
Congress intended the term to bear when
it passed the TVA Act. Neither party nor
this court has uncovered any legislative
history specifically on section 83lg(a).
This controversy that occupies us over
forty years later merited no particular
attention at the time of the Act's passage.

A consideration of the Act as a
whole, however, supports our conclusion
that the TVA is in full compliance with

the statute by maintenance of an office
58a

in Muscle Shoals for receipt of service of
process.’

The TVA Act functions as the corporate
charter of the Authority. 2A C. Sands,
Sutherland Statutory Construction § 49.03
at 233 (4th ed. 1973), indicates that the

practical interpretation of a statute must

be weighed in determining legislative i-tent.
There is no reason to suppose that Congress
intended so to confine the workings of the

rva.® The House committee that studied the

7other TVA business is conducted at
Muscle Shoals, including that of the ad-
ministrative offices and staffs of the
divisions of agricultural development, chem-
ical development, and chemical operations.
Over 2,000 employees function there. But
TVA does not argue that this activity
satisfies Alabama's and the district court's
reading of the statute; the activities at
Muscle Shoals beyond the maintenance of
the "principal office" are not required by
statute to be in any particular location.

8such confinement ped well have been
the intention of such Alabama representatives
as Senators Lister and Hugo Black, as sug-
gested in their subsequent statements; but
the intentions, expressed or hidden, of any
single representative do not create con-
gressional intent.

59a

TVA proposal reported: "We have sought to
set up a legislative framework, but not

to encase it in a legislative straight-
jacket. We intend that the corporation
shall have much of the essential freedom
and elasticity of a private business cor-
poration."’ H.R. No. 130, 73d Cong., lst
Sess. 19 (1933). The general thrust of
the Act argues against a localization of
its activities. The work of the TVA was
expected to be broad and far ranging. The
orientation was regional, even national,
in scope, not limited to a single state

or location. The argument of Alabama that
use in the TVA Act of language identical
to that of the principal office provisions
of two earlier, presidentially vetoed
Muscle Shoals corporation acts is unper-
suasive. The expected work of the TVA was
to range far beyond the existing operations
at Muscle Shoals. As President Franklin

Roosevelt stated in his message to Congress

60a

proposing passage of a Tennessee Valley

‘Authority Act:
It is clear that the Muscle Shoals
development is but a small part of
the potential public usefulness
of the entire Tennessee River.
Such use, if envisionedinits en-
tirety, transcends mere power
development: it enters the wide
fields of flood control, soil
erosion, afforestation, elimination
from agricultural use of marginal
lands, and distribution and di-
versification of industry. In
short, this power development of
war days leads logically to na-
tional planning for a complete
watershed involving many states
and the future lives and welfare
of millions. It touches and gives
life to all forms of human con-

cerns.

6la

I, therefore, suggest to the Con-
gress legislation to create a
Tennessee Valley Authority—a corpo-
ration clothed with the power of
government but possessed with the
flexibility and initiative of a pri-
vate enterprise. It should be charged
with the broadest duty of planning for
the proper use, conservation, and
development of the natural resources
of the Tennessee River drainage
basin and its adjoining territory
for the general social and economic

welfare of the Nation.”

%The President's interpretation of the
principal office provision coincided with
that of the TVA—an hee ba om development
since, as even the Tennessee Valley Au-
thority admits, it was drafted by the TVA.
President Roosevelt responded to Sen.
Black's immediate complaints that the TVA
was not complying with the principal office
provision by letter of September 6, 1934,
that read in pertinent part: "It therefore
seems to me to be clear that the Congress
meant by the provision as to the location
of the principal office of the Authority
only to fix a legal domicile—not to re-
strict or localize its business operations
in any way." 62a

H.R. Doc. No. 15, 73d Cong., lst Sess.
» (1933).

In finding that the general thrust
and outlook of the TVA Act militates
against a reading that the principal of-
fice provision ordained anything more
exacting than the maintenance of what, in
more current terms, we refer to as a
“registered office," this court must re-
spond to a textual argument raised by
Alabama that enjoys some surface appeal.
Section 2(e) of the Act, 16 U.S.C.

§ 83la(e), provides in part: "Each member
of the Board, in addition to his salary,
shall be permitted to occupy as his resi-
dence one of the dwelling houses owned by
the government in the vicinity of Muscle
Shoals, Alabama, the same to be desig-

nated by the President of the United States."
This salary supplement, Alabama argues, is
senseless unless the members of the Board,

and thus the administrative apparatus of

63a

the Authority, were to be living and
working at the "principal office in Muscle
Shoals." While Muscle Shoals is un-
doubtedly a lovely area, nothing in the
record indicates that it is particularly
suitable for vacation homes.

The free-residence provision is
couched in permissive terms; the initial
House version of the Act (sponsored by
Lister Hill of Alabama) read: "All
members of the Board shall reside in the
vicinity of Muscle Shoals." The adoption
by the full Congress of the permissive
language in the Senate version was seen
by the Joint Congressional Committee on
the Investigation of the Tennessee Valley
Authority in this manner: "Thus Congress
provided for the possibility that the
Authority might locate its administrative

headquarters at Muscle Shoals, but

64a

refrained from requiring that it do so "10

S. Doc. No. 56, 75th Cong., 3d Sess. 22
(1939). At the passage of the Act, the
only readily identifiable property to be
immediately transferred to TVA control was
at Muscle Shoals. Congress undoubtedly
contemplated significant activity there,
perhaps even assumed the location of head-
quarters there. But as this court has
written, "[a]n assumption is not a law."
Rogers v. Frito Lay, Inc., 611 F. 2d 1074,
1082 (5th Cir. 1980). This provision is

not a sufficient indication that Congress,
by fixing the location of the TVA's
principal office and allowing the directors

free housing there, required the

10; can be argued, however, that all

that was permissively granted was the right
to live in a government residence as oF:
posed to some other residence accessible to
the principal office in Muscle Shoals; that
is, while directors could live where they
wished, their working location remained at
the principal office (in the immediate
vicinity of Muscle Shoals).

65a

establishment of the corporate head-
quarters at that same location.

While there exists a paucity of con-
gressional discussion of this provision at
the time of the Act's passage, arguments
to this court of both parties are replete
with after-the-fact commentary by con-
gressmen and committee. The majority
report of the above-mentioned joint
congressional committee found in answer to
the specific question of TVA's alleged
noncompliance with section 83lg(a) that
"[t]he committee finds that the Authority
has legally complied with that part of
subsection (a) of section 8 of the act,
as amended, which requires that the princi-
pal office of the Authority be maintained
in the immediate vicinity of Muscle Shoals,
Ala." S. Doc. No. 56, 75th Cong., 3d
Sess. 9 (1939). In arriving at this con-
clusion, the committee majority reported:

"The term 'principal office’ has a definite

66a

legal meaning, as a fixed location where
the corporation may always be served with
legal papers. It is not synonymous with
operating or administrative headquarters,
which are often located in an entirely
different jurisdiction." S. Doc. No. 56,
75th Cong., 3d Sess. 21 (1939). The
majority report recommended "that Congress
give immediate consideration to clarifying
the question about which substantial
difference of opinion has existed." S.
Doc. No. 56, 75th Cong., 3d Sess. 22 (1939).
This invitation to full congressional at-
tention has been met only by silence.

For its part, Alabama advances the
vigorously dissenting minority report of
the joint committee, the testimony before
that committee of Alabama Senators Bankhead
and Hill and Representative Sparkman, and
the immediate objections voiced by Senator
Black in letters to Chairman Morgan of the
TVA and President Roosevelt. The gist of

67a

these statements was that the maintenance
of the actual administrative headquarters
of the TVA in Knoxville rather than

Muscle Shoals was "a plain, palpable and

wil Neither

open violation of the statute.
party's arguments from subsequent state-
ments are particularly helpful in divining
the congressional intent. This court dis-

posed of similar arguments in Rogers v.

Frito Lay, Inc., supra, with this observa-

tion:

The retroactive wisdom provided by
the subsequent speech of a member
of Congress stating that yesterday
we meant something that we did not
say is an ephemeral guide to
history.... What happened after a
Statute was enacted may be history
and it may come from members of the

Congress, but it is not part of the

1h etter of Senator Black to A.E.
Morgan, July 11, 1934.

68a

legislative history of the original
enactment.
611 F. 2d at 1080. With particular rele-
vance to the 1939 report of the joint
congressional committee, the Rogers court
wrote:
Had this statement [of a subsequent
committee] been made in the report
of the committee that recommended
the legislation, it would indeed
be part of the statutory history.
When uttered five years later [in
this case, six years], it is mere
commentary. Moreover, a committee
is not Congress. It cannot create
a congressional intent that did
not exist, or amend a statute by a
report.
Id. at 1082.
The Supreme Court, however, reminds
us that such subsequent expressions are

not without their usefulness. "And while

69a

the views of subsequent Congresses cannot
override the unmistakable intent of the
enacting one, ... such views are entitled
to significant weight ... and particularly
so when the precise intent of the enacting

Congress is obscure."' Seatrain Ship-

building Corp. v. Shell Oil Co., 444 U.S.
572, 596, 100 S. Ct. 800, 814, 63 L. Ed.
2d 36 (1980). The "precise intent of the

enacting Congress" is here certainly
“obscure," but it is doubtful that the
statements offered here can be said to
approach nich tile so grand as the view of
a subsequent Congress. Strong statements
fully supportive of their respective
positions are offered by each party. But
the only thing approaching a "view of
Congress" is its silence in the face of
this controversy. The chief force of
these subsequent declarations, then, lies
in their indication of congressional aware-

ness, at a very early date, of the TVA's

70a

alleged noncompliance with the statutory
provision. The silence of Congress did
not result from ignorance of the dispute.
Congress was directed to the problem;
simply no action was taken. }? Con-
gressional inaction is, of course, a
jumbled text from which to extract much
meaning. But continued congressional
funding of allegedly improper agency
action can be viewed in appropriate cir-
cumstances as a ratification of that
agency practice. Young v. TVA, 606 F. 2d
143, 147 (6th Cir. 1979); Swan Lake
Hunting Club v. United States, 381 F. 2d

12,1 abama attempts to draw signifi-
cance from the failure of passage of two
bills introduced 4 Tennessee representa-
tives to amend § 83lg(a) by substituting
Knoxville for Muscle Shoals as the location
of TVA's principal office. The Supreme
Court has remarked that "unsuccessful
attempts at legislation are not the best
of guides to legislative intent." Red
Lion Broadcasting Co. v. FCC, 395 U.S.

2 n. CE -1794, 1802 n.
11, 23 L. Ed. 2d 371 (1969).

7la

238, 241 n. 3 (Sth Cir. 1967).13 Aware of
the challenge to TVA's construction of the
principal office provision, Congress con-
tinues, as it has since 1934, to appro-
priate funds for the maintenance of the
central headquarters in Knoxville, not
Muscle Shoals. During a period in which
the TVA directors, in the exercise of their
business judgment, felt that efficiency
(and not the terms of section 83lg(a))
dictated a removal of the administrative
headquarters to Muscle Shoals, congres-
sional riders restricted the use of
appropriated funds in aid of that move.

And while the Act has been amended several

137va vy. Hill, 437 U.S. 153, 98 S. Ct.

2279, 57 L. Ed. 2d 117 (1978), suggests a
wary application of such principles of im-

lied statutory alteration. This situation

s not that of Hill; there are here no
competing statutory policies, no confusion
about purposes or goals. The argument is
not one of repeal by implication, the
disfavor of which Hill ably expresses. See
Young v. TVA, 606 F.2d at 148.

72a

times over the ensuing years, '4 Congress
has expressed no dissatisfaction with the
Authority's construction of the principal
office provision.

To be sure, it may not always be
realistic to infer approval of a
judicial or administrative inter-
pretation from congressional silence
alone. [citations omitted] But once
an agency's statutory construction
has been "fully brought to the
attention of the public and the
Congress," and the latter has not
sought to alter that interpretation
although it has amended the statute
in other respects, then presumably
the legislative intent has been

correctly discerned.

M4tncluding an amendment in 1935 making
ar ese the intention that the Act "be
liberally construed to carry out the pur-
poses of Congress." 16 U.S.C. § 83ldd(b).

73a

United States v. Rutherford, 442 U.S. 544,
99 S. Ct. 2470, 2476 n. 10, 61 L. Ed. 2d
68 (1979).

A lengthy consideration of the ambig-
uous meaning of the statutory term, gen-
eral principals of corporate practice, the
broad and flexible powers and purposes
conferred by the statute, and the echoing
silence of Congress in the face of the con-
troversy leads this court to conclude
that the district court's judgment must
be reversed and this case remanded for
further proceedings consistent with this

opinion.

REVERSED AND REMANDED.

74a

APPENDIX D
UNITED STATES COURT OF APPEALS

For The Fifth Circuit

No. 79-1283

D. C. Docket No. CA 77-M0377NW

STATE OF ALABAMA, Ex Rel. CHARLES A.
GRADDICK, As Attorney General of the
State of Alabama,

Plaintiff-Appellee,
versus
TENNESSEE VALLEY AUTHORITY, ET AL.,
Defendants-Appellants.
Appeal from the United States
District Court for the

Northern District of Alabama

Before GEE, FAY and RANDALL, Circuit
Judges.

75a

JUDGMENT
This cause came on to be heard on
the transcript of the record from the
United States District Court for the
Northern District of Alabama, and was

argued by counsel;

ON CONSIDERATION WHEREOF, It is now
here ordered and adjudged by this Court
that the judgment of the said District
Court in this cause be, and the same is
hereby, reversed; and that this cause be,
and the same is hereby remanded to the
said District Court in accordance with

the opinion of this Court;

IT IS FURTHER ORDERED that the

' plaintiff-appellee pay to the defendants-

appellants the costs on appeal, to be

taxed by the Clerk of this Court.
February 13, 1981

ISSUED AS MANDATE: APR 27 1981

76a

APPENDIX E
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT

NO. 79-1283

STATE OF ALABAMA, Ex Rel.,
CHARLES A. GRADDICK, As Attorney
General of the State of Alabama,
Plaintiff-Appellee,
versus
TENNESSEE VALLEY AUTHORITY, ET AL.,

Defendants-Appellants.

Appeal from the United States
District Court for the

Northern District of Alabama

77a

ON PETITION FOR REHEARING
(April 2, 1981)

Before GEE, FAY and RANDALL, Circuit Judges.
PER CURIAM:

IT IS ORDERED that the petition for
rehearing filed in the above entitled and
numbered cause be and the same is hereby

denied.

ENTERED FOR THE COURT:

s/ Thomas Gibbs, Jr.
e ates reu udge

78a

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385007_2364%3A2. Public record. Not legal advice.