1. The Supreme Court Rewrites the Law

Although it undoes nothing that Congress has done, it does many things that Congress has refused to do. It legislates and, in effect, writes laws that. Congress refuses to write. In fact, in a number of cases it has found meanings in the law so astonishing, so upsetting, and so obviously con trary to the will of Congress that Congress has had to rush through some kind of corrective law or resolution. The Court did this, for instance, in the Southeast Un derwriters case,l the portal-to-portal case,2 and the over time-on-overtime case.* • References in text are numbered by chapters and refer to notes. given in Bibliographical References, pages 197-206. 1 2 THE SUPREME COURT REWRITES THE IJAW This is not to say that the Supreme Court should never make law. Sometimes it has to, because Congress failed to. Thus, for instance, as Justice William O. Douglas has said, The legislative solution is often to write two opposing ideas· into a statute . . . the battle that raged before the legislature is now transferred to the Court . . . A hiatus may be left in a law. The crucial matter may have. been too explosive for the legislators to handle . .. The necessity to fill in the gap is then presented to the court. And the judges are left at large in a field that the legislature lacked capacity to define. To a degree the same problem is pre sented to the judiciary when vague and general language is employed like the words "fair" or "just" or "equita ble." ...3 And witness the remark of a weary Congressman in the closing debate on the Robinson-Patman Act (of which this book will have much to say).

"Bills ofttitnes are vague and ambiguous. . .. You might as well know that the Bill finally agreed upon by the conferees ... contains many inconsistencies, and the courts will have the devil's own job to unravel the tangle ..." 4 But the Supreme Court has gone far beyond mere pinch-hitting for Congress or filling in the gaps in mean ing that Congress lacked the nerve to fill in. For instance: In 1869, the Supreme Court ruled flatly 5 that insurance companies should be subject to state, not federal regulation. Around that decision had been woven a whole structure of state regulation. This ar rangement, as the record of the companies has shown since 1907, has worked astonishingly well. Congress let the subject alone and created no federal agency to deal with insurance. But in 1944 the Supreme Court, in a case brought by the Antitrust Division of the United THE SUPREME COURT REWRITES THE LAW 3 States Department of Justice, reversed this 70-year-old decision.6 The result was total confusion. Said Justice Jackson for the dissenting minority of the Court, "A poorer time to thrust upon Congress the necessity for framing a plan for nationalization of insurance control would be hard to find. . .. Vast efforts have gone into the development of state regulation. . .. Overturning the precedents of 75 years governing a businessof such wide ramifications cannot fail to be the occasion for loosing a flood of litiga tion and of legislation.... "

Congress then had to rush through the "moratorium" of March 9, 1945, on application of the federal antitrust· laws to insurance, until January 1, 1948, making those laws applicable to insurance after that date only "to' the extent that such businessis not regulated by state law." In 1936 Congress passedthe Fair Labor Standards Act, sometimes called the Wages and Hours Act. It set minimum hourly wages, required time-and-a-half pay for work done over 40 hours a week, and set up a Wage and Hour Division in the Department of Labor. This Act rested on or assumed a body of practices and cus toms in the relations between millions of workmen and hundreds of thousands of employers, and on a body of legal assumptions. Among these were three: (a) that the law applied only.to interstate commerce, as then de fined; (b) that working time was calculated on the time worked; and (c) that overtime was calculated by current practices.

In short order the Supreme Court upset all three as sumptions. First it found 7 that elevator operators and other building employees in two loft buildings, one in Philadelphia and one in New York, were "in interstate commerce," because "without light and heat and power 4 THE SUPREME COURT REWRITES THE LAW the tenants could not engage,as they do, in the produc tion of goods for interstate commerce. . ." Then it ruled 8 that wages, for time-and-a-half calcula tion, must be figured on a "portal-to-portal" basis. In dustry practice had been otherwise. The Wage and Hour Administrator had ruled otherwise. Congress had assumed otherwise. Pay for years had been figured otherwise. Suddenly thousands of employers found themselves open to suits for literally billions of· dollars in back-pay. Congress had to rush through a law to take care of the impasse. The law had said nothing about "overtime-on-over time." It had assumedstandard industry practice. But certain members of the AFL Longshoremen's Union in New York filed suits for back pay on the basis of a different calculation. The union itself opposed the suit, agreeing with the employers' interpretation of the con tract. But the Supreme Court, by five to three, in June 1948 upheld the claims.9 Said The New York Times on July 20, 1948 of the case: "The verdicts resulted in great confusion, particu larly in the stevedoring and construction industries. Em ployers said the verdicts would cost millions of dollars.

The government probably would have had to pay much of that becausethe claimedliability developed when dock traffic consisted largely of war supplies." So Congress passed and the President signed a bill to outlaw these wildcat claims and to make the law read explicitly as practically everybody, except a handful of longshore men and five members of the Supreme Court, had as sumed it meant in the first place. These, however, are only a tithe of the cases in which the "new" Supreme Court has upset going trade practices, Congressional intentions, and existing legal assumptions.

THE SUPREME COURT REWRITES THE LAW 5 Other cases in which it has' created confusion by aston ishing novel rulings include the matters' of reciprocal federal-state tax immunity, the tidelands oil question, the Christoffel decision10 upsetting a ISO-year-old Con gressional precedent on what constitutes .a committee "quorum," and many others. ' Justices of the Supreme Court have themselves,in cases where they dissented from the majority decision, fre quently commented on the Court's new willingness to invade Congress' field of legislation. Thus Justice Roberts in the Hutcheson case 11 stated, "I venture to say that no court has ever undertaken so radically to legislate where Congress has refused to do so." And Justice Stone: "I think that the responsibility of departing from the long-accepted construction of this statute should be left to the legislativebranch of the gov ernment to which it rightfully belongs." 12 Justice Douglas: "The necessity of resorting to such a circuitous route is sufficient evidence to me that we are performing a legislativefunction in finding here a defini tion of a crime which will sustain this indictment." 13 Justice Frankfurter: "If ever there was an intrusion by this Court into a field that belongs to Congress, and which it has seen fit not to enter, this is it." 14 Justice Stone: "It is not for this Court to adopt policy, the making of which has been by the Constitution com mitted to other branches of the government. It is not its function to supply a policy where none has been de clared or defined and none can be inferred." 15 Justice Murphy: ". . . the proper course is to seek amendatory legislation from the Congress, not to fabri cate authority by ingenious reasoning based upon pro visions that have no true relation to the specific prob lem." 16 6 THE SUPREME COURT REWRITES THE LAW Justice Rutledge: "But we are as often told that Con gress should perform the creative.act in Congress' field.

This should be most true where what we are called upon to recreate is Congress' own handiwork. If Congress intended the Administrator to act retroactively, Congress wholly failed to 'expressthis purpose." 17 Justice Burton: ". . . I am obliged to dissent from the majority of this Court and to sound a warning against tlle dangers of overexpansionof judicial control into the fields allotted by the Constitution to agencies of legislativeand executive action." 18 These are only a selected few among the remarks that different Supreme Court justices -have made in recent years about their oWn colleagues' decisions. As the gov emment gets bigger and the federal laws get longer, there is a tendency for government lawyers to acquire more power, particularly over businessmen,who are not much liked by the federal courts. There have been two recent dams against this growth of bureau and commission-lawyer power. One was a decision of the Supreme Court some 30 years ago,19-on the powers of the Federal Trade Commission,which said "It is for the courts, not the Commission, ultimately to determine as a matter of law what they [the words "un fair methods'of competition"] include." The other was an Act, passed by Congress in 1947,20 the Administrative Procedure Act, in which Congress said that people on trial before a government department are entitled to a Court review,of whether the government'lawyers really have "substantial evidence" against them.

But in case after case recently, the Supreme Court has been saying, in effect, that it will take the government lawyers' word for it. It has held, in effect, that Congress intended the courts to give a virtual rubber-stamp apTHE SUPREME COURT REWRITES 'THE LAW 7 proval to, as "experts," the government lawyers of the Federal Power Commission,21 the Securities and Ex change Commission,22and the Federal Trade Commis sion.23 As a result it is lack of money rather than lack of power that holds back such government agencies from haling more businessesinto court. "If we had the money," said a Federal Trade Commissionerrecently, "we could get a 'cease-and-desist' order against every businessmanin the United States who is engaged in interstate commerce. The businessmanhas nothing to say. He can only hope the law of averageswill keep him off the wrong end of a complaint." 24 In recent decisions,the Supreme Court has carried this tendency to accept the word of government lawyers to an extraordinary degree. In the Morton Salt case, the majority decision inspired the minority to comment on "the almost absolute subservience of judicial judgment to administrative experience." And in the Cement Insti tute case,25 the Court in effect banned (or cast a heavy legal cloud over) the use, by heavy industry, of basing points for pricing purposes, despite the fact that Congress had explicitly refused to write any such ban into the law.

Of this Cement Institute case the lower court said, "If this pricing system which Congress has over the years steadfastly refused to declare illegal . . . is now to be outlawed by the courts, it will mark the high tide in judicial usurpation. . .. The basing point system has been in use by industry for almost half a century .... Congress has repeatedly refused to declare it illegal. . . . In our judgment the question . . . rests clearly within the legislative domain. . . ." 26 But the Supreme Court thought differently. Or at least, most industry lawyers so concluded. But the 8 THE SUPREME COURT REWRITES THE LAW Court's opinion ran to over ten thousand words and, to judge by the comment, it seems that "you could prove almost anything by ·it."