# Opposition Brief — Stinson Canning Co. v. United States

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Opposition Brief
- **Published:** January 1, 1949
- **Citation:** 336 U.S. 951

## Text

INDEX
Page
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AE i. LS eas ge vine hile d Maat ow mee bern 1
EE NEE, 5 5. aac ee ductus sacckauns seston eases 2
ES hc Sc Lionas ak Pak ken AWSEK OF Renee e 2
gee re at Deni ary kas DEEN 3
EE cis sais Kv on seh ec badaksodbeteoerwn Ogee Oeeakant 7
I 55s 4a on alee Ok CE REE oa awed RONAN eRe 11
CITATIONS
Cases :
Clark v. Barnard, 108 U. 8. 436.................. 000s 8
Fresh Grown Preserve Corp. v. United States, 143 F.
RE AR TE eae Mien Ee ee op a ee Pm See 8,10, 11
Fresh Grown Preserves Corporation v. United States, 144
EE VRE RG ane Canis DERG Rad bee ewe FE 8
Paris v. United States, 137 F. 2d 300................... 8
United States v. Dieckerhoff, 202 U. S. 302............. 8
United States v. Kent Food Corporation, 168 F. 2d 632,
certiorari denied, 335 U. S. 885...................... 10
Statute :

The Federal Food, Drug, and Cosmetie Act of June 25,
1938, ¢. 675, section 304, 52 Stat. 1040, 1044 (21 U.S.C.

ES tis aoa awed KEE ORE ERO AN See 2
18 U.S.C. 646 (1946 ed.), now 18 U.S.C. 3617.......... 8
Miscellaneous :

Se SN Seen aera eae ~

nthe Supreme Court of the Winited States

OcToBER TERM, 1948

No. 576

Stinson CANNING COMPANY AND AMERICAN SURETY
Company (399 Cases, More or Less, BEACH
CurrF Brand Marne SARDINES, ETC.), PETI-
TIONERS

v.

UNITED STATES OF AMERICA

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

BRIEF FOR THE UNITED STATES IN OPPOSITION

OPINION BELOW
The opinion of the Court of Appeals (R. 30-35),
is reported at 170 F. 2d 764.

JURISDICTION
The judgment of the Court of Appeals was en-
tered November 11, 1948 (R. 35), and a petition for
rehearing (R. 36-45) was denied January 3, 1949

(1)

2

(R. 46). The petition for a writ of certiorari was
filed February 19, 1949. The jurisdiction of this
Court is invoked under 28 U.S.C. 1254(1).

QUESTION PRESENTED

Whether, upon a finding that the claimant had
failed over a period of eight months to comply with
decrees entered pursuant to the Federal Food,
Drug, and Cosmetic Act condemning certain lots of
canned sardines and providing for their release to
the claimant for the purpose of segregating, if pos-
sible, the diseased and undiseased sardines and de-
stroying the former, the District Court abused its
discretion in ordering the forfeiture of perform-
ance bonds without affording the claimant further
time and opportunity to show that its default was
not wilful or the result of gross neglect.

STATUTE INVOLVED
The Federal Food, Drug, and Cosmetic Act of
June 25, 1938, c. 675, section 304, 52 Stat. 1040, 1044
(21 U.S.C. 334), provides in part:

(a) Any article of food, drug, device, or cos-
metic that is adulterated or misbranded when
introduced into or while in interstate com-
merce, * * * shall be liable to be proceeded
against while in interstate commerce, or at
any time thereafter, on libel of information
and condemned in any district court of the
United States within the jurisdiction of which
the article is found. * * *

* * * * *

3

(d) Any food, drug, device, or cosmetic con-
demned under this section shall, after entry of
the decree, be disposed of by destruction or sale
as the court may, in accordance with the provi-
sions of this section, direct and the proceeds
thereof, if sold, less the legal costs and charges,
shall be paid into the Treasury of the United
States ; but such article shall not be sold under
such decree contrary to the provisions of this
Act or the laws of the jurisdiction in which
sold: Provided, That after entry of the decree
and upon the payment of the costs of such pro-
ceedings and the execution of a good and suffi-
cient bond conditioned that such article shall
not be sold or disposed of contrary to the pro-
visions of this Act or the laws of any State
or Territory in which sold, the court may by
order direct that such article be delivered to
the owner thereof to be destroyed or brought
into compliance with the provisions of this
Act under the supervision of an officer or
employee duly designated by the Administra-
tor, and the expenses of such supervision shall
be paid by the person obtaining release of the
article under bond. * * *

(e) When a decree of condemnation is en-
tered against the article, court costs and fees,
and storage and other proper expenses, shall
be awarded against the person, if any, inter-
vening as claimant of the article.

STATEMENT

In April 1947, separate libels were filed in the
District Court for the Eastern District of South

: —
4

Carolina under the Federal Food, Drug, and Cos-
metic Act, supra, for the condemnation of eight
lots of canned sardines on the ground that they
were diseased (see R. 3, 8, 25,30). Petitioner Stin-
son Canning Company intervened and claimed
ownership of the sardines (R. 19, 30). It admitted
the allegations of the libels and consented to the
entry of decrees of condemnation (R. 19, 25). Con-
sent decrees were accordingly entered on October
11, 1947, which provided, in accordance with Sec-
tion 304(d) of the Act, supra, that petitioner Stin-
son could retake possession of the condemned
sardines upon posting bonds in specified amounts,
conditioned upon the following undertakings:
Stinson would proceed to segregate the sardines so
as to effect a separation of the cases or cans con-
taining diseased fish from those containing fish not
diseased. If such a segregation were accomplished
to the satisfaction of a representative of the Food
and Drug Administration, only the cases or cans
found to contain diseased fish were to be destroyed ;
otherwise, the entire lots were to be destroyed. The
decision of the Food and Drug Administration as to
whether the salvage operation had been satisfac-
torily completed was to be final. Stinson was not to
ship or sell, or offer to ship or sell, any of the sar-
dines until they were released by the Food and
Drug Administration. A time limit of three
months from the entry of the decrees was imposed
for the segregation and destruction of the sardines.

a

5

The District Court expressly retained jurisdiction
of the proceedings, and the decrees further pro-
vided that in the event of default by Stinson in the
performance of any of the specified conditions, the
bonds should be forfeited on motion of the Govern-
ment, and judgment entered thereon. (R. 25-27.)

Bonds in the aggregate amount of $20,020, con-
ditioned upon these undertakings, were filed by
petitioner Stinson as principal and petitioner
American Surety Company as surety (R. 21, 23,
30). Stinson then shipped the sardines to its plant
in Maine, but they remained unsegregated and un-
destroyed at the end of the three-month period
(see R. 4). OnJanuary 19, 1948, a 90-day exten-
sion, to April 18, 1948, was granted by the District
Court, with the proviso ‘‘that no further extension
shall be applied for by the said Claimant”’ to per-
form the acts required by the decrees (R. 28; see
also R. 22).

On May 25, 1948, a motion was filed by the Gov-
ernment for judgment on the bonds and for an
order directing the destruction of the condemned
sardines on the ground that petitioner Stinson had
not complied with the terms of the decrees of Octo-
ber 11, 1947. The motion papers, which were
served upon petitioners (R. 22-23), recited that
Stinson had failed either to separate or destroy the
sardines, and had not indicated to the Food and
Drug Administration if and when they intended to
destroy them, despite the efforts of that agency to

scan

6

cooperate in the supervision of performance with
the provisions of the decrees (R. 3-7).

No written return was filed in opposition to the
motion, but on the day set for the hearing, June 7,
1948, counsel for petitioner Stinson appeared be-
fore the District Court and, as an oral return,
stated that it had been found impractical to segre-
gate the sardines and admitted that they had not
been destroyed. A motion was made at that time
for modification of the decrees to permit export of
the condemned articles. Counsel explained to the
court that the tolerance for diseased sardines
shipped abroad was higher than that permitted by
the Food and Drug Administration for domestic
consumption, and, in view of the food shortage in
other countries, use might be made of the con-
demned sardines. Counsel stated further that he
had made a similar motion in another proceeding
which was pending in the federal district court at
Buffalo, New York, and that action on such motion
was being held in abeyance pending a decision on
the issue in another case by the Court of Appeals
for the Second Circuit. Counsel also stated that he
had informed a Mr. Sullivan of the Boston Station
of the Food and Drug Administration that he in-
tended to use the Buffalo proceeding as a test case
to govern the disposition of several libels involving
Maine sardines which were pending in various
parts of the country. (R.8-11,17.) He admitted,
however, that he had been advised that the Food

a

and Drug Administration was opposed to the grant-
ing of permission to export food which had been
condemned (R. 10-11, 12).

The motion to amend or modify the decrees to
permit export of the sardines was denied on its
merits and for untimeliness (R. 17, 24). The Dis-
trict Court also denied a continuance to permit
petitioner Stinson to produce Mr. Sullivan to sup-
port its contention that it had not acted in bad faith
in not complying with the terms of the decrees
(R. 18-19). The court found that Stinson had been
guilty of dilatory conduct, that the return was in-
adequate, and that petitioners were in default on
the performance bonds (R. 17, 23-24). Judgments
in the amount of each of the bonds, together with
the costs of the proceedings, were awarded to the
Government (R. 24, 30).

On appeal to the Court of Appeals for the
Fourth Circuit, the judgments were affirmed (R.

30).
ARGUMENT

It is clear that the failure of petitioners to segre-
gate and destroy the condemned sardines within
the prescribed time constituted a breach of the con-
ditions of the bonds. Petitioners contend in effect
that their oral return to the Government’s motion
for judgment on the bonds raised an issue of good
faith in respect of the default and, therefore, they
were entitled to a trial of that issue. This conten-
tion is based upon the premise that the District
Court had power to remit all or part of the penalty

—y

8

upon a finding that the default did not result from
gross neglect or bad faith.

These bonds were penal and not indemnatory.
Fresh Grown Preserve Corp. v. United States, 143
F. 2d 191 (C.A. 6); Fresh Grown Preserves Cor-
poration v. United States, 144 F. 2d 136 (C.A. 4),
On the breach of the conditions, the Government
was entitled to recover the full amount without
proof that any damages had been sustained. Clark
v. Barnard, 108 U.S. 486; United States v. Diecker-
hoff, 202 U.S. 302. We do not believe that the Dis-
trict Court had power to remit any part of the
bonds after determining that the conditions had
been broken. Congressional approval of judicial
remittance of penal bonds appears to be limited to
bail bonds.’ See Rule 46(f), F. R. Crim. P.? But,
as the Court of Appeals properly observed (R. 32),
it is unnecessary to consider that question, for it is
clear in any event that the District Court was fully

1Cf. 18 U.S.C. 646 (1946 ed.), now 18 U.S.C. 3617.

2 Paris v. United States, 137 F. 2d 300 (C.A. 4), upon which
petitioners rely (Pet. 7) as establishing a principle in conflict
with that of the decision below (the same court decided both
cases), holds merely that since a district court has discretion to
remit the penalty on a bail bond, a proper exercise of discre-
tion required the court to give consideration to the defend-
ant’s explanation that his default was induced by representa-
tions of the district attorney and thus was not wilful. In the
ease at bar, on the other hand, apart from the distinction that
remission is probably not available in any event, it is clear that
even if full acceptance were accorded to Stinson’s excuse for
noncompliance with the decrees, the District Court properly
exercised its discretion in holding the excuse insufficient and
in ordering a forfeiture of the bonds.

_—

9

justified in decreeing forfeiture in full. The trial
judge found that ‘‘the whole course of this case has
been one of complete dilatory action on behalf of
the claimant’’ (R. 17). In its opinion, the Court of
Appeals reviewed at length the factual basis for
this finding and agreed that petitioners’ conduct
was ‘‘extremely dilatory’’ (R. 33) and that ‘‘They
have offered an utterly insufficient excuse for such
grossly neglectful behavior’’ (R. 34).

Petitioners were admonished on January 19,
1948, after the original three months’ period for
compliance had expired, that an extension of 90
days was granted with the express understanding
that no application would be made for any further
extension (R. 28). Petitioners had almost eight
months, from the entry of the decrees (October 11,
1947) until the return date of the Government’s
motion for judgment on the bonds (June 7, 1948),
to perform their undertakings. They were noti-
fied by the court in advance that judgment would
be granted against them unless the matter was dis-
posed of within the time limit (R. 11). Despite
these explicit directions, petitioners disregarded
the efforts of the Food and Drug Administration to
cooperate in the segregation and destruction of the
diseased food and made no attempt to comply with
the provisions of the decrees (R. 3-7). Noncom-
pliance persisted right up to the hearing on the
motion for forfeiture (see R. 13).

The return of petitioners did not raise any mate-
rial issue of fact. The decrees required them either

—

10

to segregate the comdemned sardines and destroy
that part which was diseased or to destroy the en-
tire lots. If, as pettitioners contend, Stinson con-
templated resort to a third alternative, i.e., the
exportation of the sardines without segregation (a
procedure, incidenttally, which has not received
either administrative or judicial approval, United
States v. Kent Food Corporation, 168 F. 2d 632
(C.A. 2), certiorari denied, 335 U. S. 885), it was
incumbent upon them at least to ask the District
Court to modify its decrees, instead of ignoring
them completely until the hearing on the motion
for forfeiture of the bonds.

Petitioners urge (Pet. 7) that the decision in this
case is in conflict with Fresh Grown Preserve Corp.
v. United States, 143 F. 2d 191 (C.A. 6). To the
contrary, the two decisions are entirely consistent.
In the case cited, the claimant filed an affidavit in
opposition to the motion for forfeiture in which it
stated that its failure fully to comply with the pro-
visions of the decree ‘‘was not occasioned through
any fault of the claimant”’’ but was due to the fail-
ure of the Food and Drug Administration to co-
operate in the supervision of its performance. The
court held that this attempted justification did not
raise any material issue of fact, since the only issue
was whether the claimant had actually complied
with the decree. ‘‘The course pursued by the
agency appears to have been either arbitrary or
neglectful, but this afforded appellant no right to

11

violate the law. The appellant’s appropriate course
would have been to move the district court for an
order directing the Federal Agency to perform
forthwith its function under the decree. The aid
of the court was not thus invoked. To the contrary,
appellant deliberately violated the court’s order by
its own admission.’’ 143 F. 2d at 196.

Likewise, in the case at bar, if petitioners’ return
to the motion for forfeiture had raised an issue
whether or not they had complied with the provi-
sions of the decrees, they would have been entitled
to a hearing on that issue. But no such issue was
presented and the trial judge properly exercised
his discretion in refusing to grant any further ex-
tensions of time for compliance with the decrees.

CONCLUSION

The judgment below is clearly correct and no
conflict of decisions is involved. Accordingly, we
respectfully submit that the petition for a writ of
certiorari should be denied.

Puitie B. PERLMAN,
| Solicitor General.
ALEXANDER M. CAMPBELL,
Assistant Attorney General.
Rosert S. ErDad#1,
| Harotp D. CoHEN,
Attorneys.

v

Marcu 1949.

wo. S. GOVERNMENT PRINTING OFFICE: i948 e2ete¢ soe

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386416_2027%3A2. Public record. Not legal advice.