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National Resources Defense Council Inc. v. Tennessee Valley Authority

decided: March 27, 1972.


Action in the District Court for the Southern District of New York, by three environmental protection organizations, two incorporated and having their principal places of business in New York and one incorporated and having its principal place of business in California, against the Tennessee Valley Authority and its chairman, to enjoin the Authority from purchasing coal strip-mined by a producer in Kentucky and lessees of TVA-owned land in Tennessee, and for other relief. Appeal under 28 U.S.C. § 1292(b) from an order of the district court, Constance Baker Motley, Judge, denying defendants' motion to dismiss for lack of proper venue.

Before Friendly, chief Judge, Timbers, Circuit Judge, and Jameson, District Judge.*fn*

Author: Friendly

FRIENDLY, Chief Judge:

Plaintiffs in this action in the District Court for the Southern District of New York are three non-profit organizations concerned with the environment. Plaintiffs National Resources Defense Council, Inc. and Environmental Defense Fund, Inc. are New York membership corporations, the former having its principal place of business in the Southern and the latter in the Eastern District of New York. Plaintiff Sierra Club is a California membership corporation having its principal place of business in that state. The defendants are Tennessee Valley Authority (TVA), a federal corporation, and Mr. Wagner, its chairman.*fn1

Section 8(a) of the Act creating the TVA provided that it "shall be held to be an inhabitant 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." 16 U.S.C. § 831g(a). Mr. Wagner's residence is in the Eastern District of Tennessee where TVA has its administrative headquarters. Service of process was made as provided in 28 U.S.C. § 1391(e), see fn. 2. Plaintiffs seek declaratory and injunctive relief under various federal statutes and regulations against TVA's purchasing strip-mined coal under contract from Kentucky Oak Mining Company, a Kentucky corporation, and from two lessees of TVA owned property, W.B. Spradlin Coal Company, a sole proprietorship owned by a resident of Tennessee, and West Coal Corporation, a Tennessee corporation, none of which do business in the Southern District of New York. TVA likewise does not do so. The complaint also contained a claim attacking generally TVA's "practice and policy of purchasing and burning huge quantities of strip-mined coal." The merits of the complaint are not before us; our concern is limited to the question of venue.

It is common ground that venue could not have been laid in the Southern District of New York under the general federal question venue statute, 28 U.S.C. § 1391(b), since this permits an action to be brought "only in the judicial district where all defendants reside, or in which the claim arose, except as otherwise provided by law." Plaintiffs' case for the propriety of venue rests on 28 U.S.C. § 1391(e), added to the Judicial Code by § 2 of Pub. L. No. 87-748, 76 Stat. 744, which we quote in the margin,*fn2 and, more particularly, on clause (4) thereof.

Defendants moved to dismiss for lack of proper venue on numerous, perhaps too numerous, grounds. They contended (1) that § 1391(e) was not intended to apply to an action against a locally based federal business corporation such as TVA but only to actions against federal officers or agencies which previously could have been brought only at the seat of the Federal Government, in the District Court for the District of Columbia; (2) that § 8(a) of the TVA Act fixing the Authority's residence in the Northern District of Alabama caused the action to fall within the clause in § 1391(e), "except as otherwise provided by law;" (3) that clause (4) of § 1391(e) required all plaintiffs to reside in the judicial district where suit was brought; (4) that "real property is involved in this action" and clause (4) of § 1391(e) was consequently inapplicable; and (5) that the three coal companies were indispenable parties and hence the action was not one "in which each defendant is an officer or an employee of the United States or any agency thereof . . . or an agency of the United States."*fn3 The district court denied the motion but made the certificate required for an interlocutory appeal by 28 U.S.C. § 1292(b). We granted leave and expedited the hearing of the appeal. Since we sustain the first ground of defendants' motion, we have no occasion to consider the others.

On the district court's reading of § 1391(e), the suit could as well have been maintained in the Northern District of California if plaintiffs had chosen to bring it there. Also a suit for similar relief by an environmental organization incorporated in Hawaii or Alaska could be brought in those judicial districts. This is surely a strange consequence when the TVA operates in much the same way as an ordinary business corporation, under the control of its directors in Tennessee, and not under that of a cabinet officer or independent agency headquartered in Washington, and the conduct at issue affects only Kentucky and Tennessee. In holding that § 1391(e) permits a result apparently so eccentric, the court fell into error by treating that section simply as a text to be parsed with such aid as the dictionary and grammar afford and without adequately considering the history of the statute and the evil it was designed to cure. As Mr. Justice Frankfurter pertinently said, "once the tyranny of literalness is rejected, all relevant consideration for giving a rational content to the words become operative" and "[a] restrictive meaning for what may appear to be plain words may be indicated by the Act as a whole [or] by the persuasive gloss of legislative history . . . ." United States v. Witkovich, 353 U.S. 194, 199, 1 L. Ed. 2d 765, 77 S. Ct. 779 (1957).

As already indicated, § 1391(e) was not the whole statute which Congress enacted in 1962. It was the second section, the first being what has been codified as 28 U.S.C. § 1361,*fn4 and the two must be read together. The statute had a long labor period, its conception going back to a bill introduced by Representative Budge of Idaho in 1958.*fn5 The need for the legislation arose from the venerable decision in M'Intire v. Wood, 11 U.S. (7 Cranch) 504, 3 L. Ed. 420 (1813), denying to the lower federal courts mandamus jurisdiction over federal officers, a ruling only partially alleviated by Kendall v. United States ex rel. Stokes, 37 U.S. (12 Pet.) 524, 9 L. Ed. 1181 (1838), holding that mandamus could be maintained in the then circuit court for the District of Columbia. Some relief from this harsh doctrine was obtained by proceeding against a local official through injunction rather than mandamus. But this was permissible only when the superior officer in Washington was not an indispensable party, as he was "if the decree granting the relief sought will require him to take action, either by exercising directly a power lodged in him or by having a subordinate exercise it for him." Williams v. Fanning, 332 U.S. 490, 493, 92 L. Ed. 95, 68 S. Ct. 188 (1947), and application of this principle did not prove easy. As noted in Liberation News Service, supra, 426 F.2d 1379 at 1383, "The problem was particularly acute with respect to land disputes in Western states where the Government is a large landowner."

After the many vicissitudes summarized in the opinion just cited, the bill that was to become Pub. L. No. 87-748 was introduced by Representative Poff in 1961, and was referred to the Committee on the Judiciary. On behalf of the subcommittee that had considered the bill, Representative Forrester submitted a favorable report, H.R. Rep. No. 536, 87th Cong. 1st Sess. Consistently with the purpose which had animated the legislation from the outset, the report stated its objective as follows:

The purpose of this bill is to make it possible to bring actions against Government officials and agencies in U.S. district courts outside the District of Columbia, which, because of certain existing limitations on jurisdiction and venue, may now be brought only in the U.S. District Court for the District of Columbia.

Id. at 1. It added in language highly relevant here:

This bill is not intended to give access to the Federal courts to an action which cannot now be brought against a Federal official in the U.S. District Court for the District of Columbia.*fn6

Id. at 2. The Report of the Senate Committee on the Judiciary contained essentially identical statements. S. Rep. No. 1992, 87th Cong., 2d Sess. 2 (1962), reprinted in U.S. Cong. & Adm. News 2784, 2785. The Senate Committee had amended the House bill in various ways including the insertion of the phrase "except as otherwise provided by law," and the report explained this by giving as examples "proceedings brought with respect to Federal taxes and under section 5 of the act of September 26, 1961, relating to immigration." Id. at 4. When the bill passed by the Senate was returned to the House, Representative Poff ...

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