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HOLLAND v. GMC

December 15, 1947

HOLLAND et al.
v.
GENERAL MOTORS CORPORATION. CASHEBA et al. v. SAME



The opinion of the court was delivered by: KNIGHT

Each of the above-entitled actions is a so-called 'Portal-to-Portal' suit. The defendant moves for a dismissal on the ground that the complaint does not allege the necessary jurisdictional facts.

The plaintiffs urge that a decision of the motion should be deferred pending a 'factual' determination. This contemplates deferment to the conclusion of the trial of one or all of these suits in which there are hundreds of parties-plaintiff and in which it may well be presumed there will be presented many issues of fact.

 The question of the constitutionality of the Portal-to-Portal Act of 1947, 29 U.S.C.A. § 251 et seq.; is necessarily involved in these motions. In the interest of a speedy final determination of this question, it is believed it should be considered at this time, and simultaneously with such consideration a determination of the procedural point raised by the plaintiffs.

 The United States, intervening since the motions herein first came on for a hearing, has asked an extension of thirty days in which to submit a brief in support of the constitutionality of said Portal-to-Portal Act of 1947 after service upon it of plaintiffs' and defendant's briefs herein. Thus far the plaintiffs have briefed only incidentally the constitutional question. The defendant has briefed at some length the question, but it should be permitted to answer any further arguments or briefs submitted by the plaintiffs and the United States.

 It has seemed to me that there is less cause for confusion now by the foregoing statement, rather than by an extended discussion of possible conflicting authorities.

 The date for final argument herein will be fixed by the Court or agreed upon by Counsel.

 Dec. 15, 1947.

 The defendant in the above-entitled suits moves the court for dismissal of the complaints for lack of jurisdiction. The questions involved in each suit are the same, and what is said herein applies to all.

 Lack of jurisdiction is grounded on the claim that the complaints allege no facts showing that any of the alleged activities were engaged in during the portion of the day with respect to which they were made compensable under any alleged contract provision, custom or practice making such activities compensable, all as required by Section 2(a-d), Part II, of the Portal-to-Portal Act, approved May 14, 1947.

 Upon certification of this court that the constitutionality of the Portal-to-Portal Act of 2947, 29 U.S.C.A. § 251 et seq. (hereinafter called Portal Act), had been drawn in question, the United States has intervened in support of its constitutionality.

 Each complaint purports to set up a cause of action under the provisions of the Fair Labor Standards Act of 1938, 29 U.S.C.A. § 201 et seq., by virtue of which an employee is entitled in the computation of his statutory work week to compensation for overtime, computed at 1 1/2 times the regular rate at which he was employed. The pertinent allegations of the complaints, in substance are: That plaintiffs were employed in interstate commerce; that their work week was longer than permitted by law without overtime compensation; that they were required to arrive at defendant's premises and to remain there for substantial periods of time before their scheduled starting time and after the scheduled quitting time; that such periods were consumed by the time necessary to change clothing, obtain and return equipment, in preparation for work; and that such overtime employment was in activities under defendant's control and for its benefit, and that they have not been compensated therefor.

 Plaintiffs oppose these motions on procedural grounds and also the ground that the Portal Act of 1947 is unconstitutional as to actions brought prior to May 14, 1947.

 It is well settled in the Federal Courts that one seeking a recovery must affirmatively show jurisdiction. The Portal Act is an amendment to the Fair Labor Standards Act of 1938. It is not the case of an exception where a party must show that it does not come within the exception. Vide: The Assessors v. Osbornes, 9 Wall. 567, 76 U.S. 567, 19 L. Ed. 748; Norton v. Larney, 266 U.S. 511, 45 S. Ct. 145, 69 L. Ed. 413; Smith v. McCullough, 270 U.S. 456, 46 S. Ct. 338, 70 L. Ed. 682; McNutt v. General Motors Acceptance Corp., 298 U.S. 178, 56 S. Ct. 780, 80 L. Ed. 1135; Gully v. First Nat. Bank, 299 U.S. 109, 57 S. Ct. 96, 81 L. Ed. 70; LeMieux Bros. Inc. v. Tremont Lumber sco., 5 Cir., 140 F.2d 387; United States v. Green, 9 Cir., 107 F.2d 19.

 Plaintiffs assert that the validity of plaintiffs' claim of constitutionality may depend on facts which may be developed on the trial and that any decision on the motions should be deferred pending a 'factual determination.' If the Portal Act is held to be unconstitutional, issue, if joined, may require factual determination, otherwise not. The basic inquiry is whether Congress could take from the courts jurisdiction in suits on complaints such as here.

 Plaintiffs claim that the Portal-to-Portal Act is an attempt to control jurisdiction and procedure to defeat substantive rights guaranteed by the Constitution; that the Act violates the Fifth Amendment of the Constitution by depriving the plaintiffs of their property without due process of law and violates Article III, Section 1 of the Constitution, through the attempt to exercise judicial power reserved to the courts.

 The decision in Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680, 66 S. Ct. 1187, 90 L. Ed. 1515, led to a veritable deluge of suits by thousands upon thousands of employees in which damages are demanded in a total in dollars colossal in amount. This decision awoke employees coming under the provisions of the Fair Labor Standards Act to the expectation that they were entitled to compensation for activities in which they had long been engaged with no expectation of compensation.

 As of January 31, 1947, the Administrative Office of the United States Courts reported 1515 cases had been filed in which the aggregate claims totaled $ 5,785,204,606. A great number of suits were brought after that date. In many instances no specific amount of damages was stated in the complaints. In many instances no specific amount of damages was stated in the complaints. In this Western District of New York, 110 suits have been brought on behalf of 72,674 plaintiffs, seeking damages in the amount of $ 91,947,000, not including those suits in which no specific amount of damages is claimed. There are 4280 plaintiffs in the actions in this suit.

 In the brief time since the Portal Act was enacted, motions in effect, as here, have been decided in many Federal District Courts throughout the United States. I have read many of these decisions. So far as I have learned there has been a unanimity of decisions, save in a few cases, that the Portal Act is constitutional. No Circuit Court so far as I am informed has passed on the questions presented here. Ward Baking Co. v. Holtzoff, U.S. District Judge, 164 F.2d 34, decided in this Circuit in November, 1947, does not do so. It may seem an act of supererogation on my part to announce any extended opinion. What is here said is said to emphasize the significance of two things, which to me seem to have great importance in deciding the questions presented. These are the finding of an emergency, as set out in the Portal Act, and the authority given to Congress where interstate commerce is concerned.

 Section 1 of the Portal Act contains a clear and comprehensive statement of findings and the policy of Congress in the enactment of the legislation. Such a type of what may ordinarily be called a preamble is not common in statutes. It is, however, of long standing and has been employed numerous times in emergencies and in extraordinary circumstances. Here most unusual and extraordinary circumstances were disclosed to Congress. Findings and a statement of policy appear in the Fair Labor Standards Act of 1938, Sec. 2(a), and it is left undisturbed. There, as here, they were purposed to fortify the other provisions of the Act as an emergency measure. The constitutionality of that Act has been determined by numerous decisions of the courts. Comparable declarations, also, are the joint resolutions adopted by Congress on June 5, 1933, with respect to the 'Gold Clause' in private contracts for the payment of money. 48 Stat. 112. Norman v. Baltimore & Ohio R. Co., 294 U.S. 240, 55 S. Ct. 407, 79 L. Ed. 885, 95 A.L.R. 1352. The Agricultural Adjustment Act of 1933, 7 U.S.C.A. § 601 et seq., disclosed such.

 The most significant parts of Section 1 are in the findings in the Portal Act of 1947, that the payments of unexpected liabilities would bring about financial ruin of many employers, thereby resulting in the reduction of industrial operations and curtailing employment; that serious and adverse effects upon the revenues of Federal, State, and local governments would follow; and that a substantial burden on commerce and obstruction to the free flow of goods in commerce would result. The policy of Congress is therein declared to be the purpose 'to meet the existing emergency and to correct existing evils (1) to relieve and protect interstate commerce * * *; (2) to protect the right of collective bargaining; and (3) to define and limit the jurisdiction of the courts.' 29 U.S.C.A. § 251(b).

 In passing on the constitutionality of the Fair Labor Standards Act of 1938, the court in Opp Cotton Mills v. Administrator, 312 U.S. 126, 145, 61 S. Ct. 524, 533, 85 L. Ed. 624, said:

 'The essentials of the legislative function are the determination of the legislative policy and its formulation as a rule of conduct. Those essentials are preserved when Congress specifies the basic conclusions of fact upon ascertainment of which, from relevant data by a designated ...


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