MITCHELL v. LUBLIN, MCGAUGHY & ASSO.
Legal provision: Fair Labor Standards
Argument of Bessie Margolin
Chief Justice Earl Warren: Number 37, James P. Mitchell, Secretary of Labor, United States Department of Labor, Petitioner, versus Lublin, McGaughy and Associates.
Ms. Margolin, you may proceed.
Ms Bessie Margolin: Mr. Chief Justice, Your Honors.
This case presents the question of the applicability of the Fair Labor Standards Act to the non-professional workers employed by an architectural engineering firm.
The question is whether such employees are engaged in commerce or in the production of goods for commerce within the statutory terms as specifically defined in the Act.
Respondents are -- are on architectural engineering firm which maintains offices in two States, that is at Virginia in the District of Columbia and has overseas associates.
Its business consists of preparing architectural and engineering plans and specifications draft and drawing primarily for industrial and Governmental projects as distinguished from residential.
Now though respondents take issue with our characterization of the fact, I don't think there's any substantial dispute on as to just what those facts actually are.
Our statement in the brief is based largely on the stipulation of facts and on the findings of the two courts below.
Respondents admittedly do not confine their operations to a single State and those offices perform substantial work both for out-of-state clientele and for out-of-state construction projects.
Justice Potter Stewart: Would you say that (Inaudible) as for the facts they -- they are fully and fairly stated in terms of this opinion?
Ms Bessie Margolin: I would say that they are fairly stated and --
Justice William J. Brennan: (Inaudible)
Ms Bessie Margolin: It is quite extensive and we would say that they're fairly stated.
They are all somewhat supplemented by the findings of the trial court and by the stipulation.
It's -- there's no question that they deal with those out-of-state clientele and on out-of-state projects and that many of their plans and specifications are prepared -- transmitted out-of-state.
I don't think there's any dispute as to those facts.
It's also undisputed as to what these non-professional workers do.
They do the non-routine -- they do their routine work, the clerical work of routine draftsmanship of the fields that they work that is necessary for the preparation of the plans and specifications.
It's also undisputed that substantial amount of their work is for the Federal Government, most of it is for Governmental agencies.
60% of the work with the Virginia office is stipulated is done pursuant to contract with the United States Army and Navy agencies and 85% of the Washington office work is done either for the Army and Navy or for the State, Municipal and Government agencies.
Respondents employed --
Justice Felix Frankfurter: What bearing is that on the (Inaudible) -- on the problem of the case that it's done for the Government?
Ms Bessie Margolin: Well, it's the -- I'm coming to the fact that -- that's what require so much of the -- of the interstate transmission of these documents.
Justice Felix Frankfurter: But it is because of that, not -- all I meant to ask is --
Ms Bessie Margolin: Well, and also because --
Justice Felix Frankfurter: -- the facts that it's done for the Government as such that --
Ms Bessie Margolin: I don't think as such but if -- that shows it's very likely to be of a national character and interstate in character.
Justice Felix Frankfurter: I understand that, but as such it's not (Inaudible) you can't associate but as such is a --
Ms Bessie Margolin: It associates that from national and interstate commerce.
They employ about 65 to 70 employees, including professional and non-professional, about 30 in the Norfolk office and about 20 in the Washington office and from 15 to 20 employees overseas.
I want to emphasize it because I think there's some confusion over the professional exemption and may have been responsible for the decision below.
But the case is concerned only with respondents of non-professional employees, not with professional architects and engineers to which qualify on this specific exemption in the Act for any employee employed in a bona fide professional capacity of those terms are defined and diminutive by regulations of the administrator.
Respondents admittedly employ quite a number of employees as clerks and (Inaudible) field men and routine draftsmen.
And these employees engage in all of the interstate activities that are necessary to conduct the two-state businesses with an out-of-state clientele and overseas clientele.
And there's no question but what that requires constant and practice both courts below noticed that requires constant interstate communication and transmission of information and documents.
Now, the Government's position is that there's no question but what the activities of these employees, their regular and substantial activities, constitute both engagement in commerce and production of goods for commerce within the literal terms of the Act and within the intent -- the legislative intent in enacting those broad terms.
The court below with three separate -- three general separate grounds and several subsidiary grounds on which our contention is based and withdrawn fully into the judicial, legislative and statutory authority for each of those grounds in our brief, I'm afraid are now beyond and obviously the time for oral argument would not permit going into them in detail here.
But I believe that the -- the best way to approach the -- the issue here is to consider the basis of the decision of the court below because I think it's the same basic reasoning explained their ruling on each particular grounds of coverage which the Government advanced.
And there, the reasoning of the Court was that none of these employees -- none of the employees of this firm were engaged in commerce or in the production of goods for commerce within the Act despite their findings and their recognition of all their interstate activities of individual employees.
That none of them was within the coverage of the Act because it viewed architectural engineering work, preparation of plans and specifications as to use this term in essentially local business, an independent enterprise which was engaged in an essentially local business and that any interstate activities that were required to carry on that essentially local business but took the local character and were not -- there was no -- there was no intent despite the language, the broad language of the statute, there was no intent to cover interstate activities which are merely incidental to an otherwise local enterprise.
Now, we think that the error of that approach is clear beyond doubt.
The Court indicated that it realized that both the statute and that the decisions of this Court has settled the principle that the coverage of this act is to be determined not by the employer business or by the nature of this business but by the particular duties of the employee.
The Congress intended that any employee who was regularly engaged in interstate activities within the statutory definition and it said any and each employee should be paid the standard of the Act and that this principle applied even though the employer's business and I think I'm quoting, “even though the employer was not engaged in an industry for taking of interstate commerce.”
The Court was also obviously influenced, the court below, by the professional -- by the fact that it felt that professional work is necessarily -- necessarily local apparently.
Justice Potter Stewart: Are you referring to the Court of Appeals?
Ms Bessie Margolin: The Court of Appeals and the District Court.
Justice Potter Stewart: (Inaudible)
Ms Bessie Margolin: No, the District Court went almost entirely off on the (Inaudible) decision which the -- the District Court of Maryland, and also on the grounds that work for military installations could not be within the scope of the Act.
The Court of Appeals didn't say anything about either on those grounds because I think it was perfectly clear that this Court's decision in Powell took any thunder out of the argument that because work is (Inaudible) it cannot be for commerce.
The Court of Appeals did though follow the lower court to the extent of adopting the reasoning of the -- of the Maryland District Court decision that goods does not include plans and specifications because they are not ordinarily sold commercially to the public generally, and were not articles -- that they represented just the embodiment of the idea and plan to get to that.
I did want to make it clear though that all three of the grounds of coverage, any one of the three separately would be sufficient to hold these employees, if you look it to the activities of the employees, with this or either anyone of the grounds will be sufficient to bring them within the coverage of the Act.
And so that it is apparent that the Court necessarily went off on an erroneous concept in order to reach the conclusion, it did.
Because, if it had looked to the activities of the employee, apparently it considered that the activities of the employees were wholly irrelevant that since this was at this unit and as we say, it's contradicted by the record that it certainly is not a local, essentially a local enterprise with it's two-state organization, its overseas association, its out-of-state clientele, and it's out-of-state projects and its constant transmission of information materials across the State lines that the Court's basic -- factual assumption is contradicted by the record.
But, even if the Court was factually correct and if it were an essentially local business, it would not follow that the employees engaged in the activity -- in interstate activities necessary to conduct that business would be outside the scope of the Act provided that they perform their duties were regularly were the intestate activity and not simply a sporadic and occasional.
Now we don't claim that because an employee occasionally has to write letters to out-of -- to out-of-the-state for an essentially local business and an occasional sporadic intestate communication brings him in within the Act.
But we do claim that where his regular and substantial duty requires continuous and regular use of the intestate channels or activities specifically related to intestate instrumentality, then, he is within the coverage of the Act even though substantial part or most of the employer's business may not be covered by the Act.
Now, they -- we think it's significant that of all the numerous decisions of this Court on construing the coverage of this Act, that the only one in which the court below found anything that seemed to substantiate its decision was 10 E 40th Street, Decatur.
Now that was the office building's maintenance employee's case which this Court distinguished from the Kirschbaum case, the Kirchbaum being the earliest decision construing the coverage of this Act where the Court first announced the employee test of coverage.
And where the Court applied it there to an independent enterprise whose business was certainly no more essentially local than the business and it's certainly more essentially local than the business here because it was maintenance of a -- of a building and rental and maintenance of the building in New York City and in Kirschbaum, the Court held that the maintenance employees' activities were within the coverage of the Act despite the fact that their employer was an independent enterprise and not himself engaged in intestate commerce.
Now, the case that the court below relied on was the Callus case which this Court distinguished in a five to four decision I might add on the basis that the evidence of the relationship to intestate production as a tenant was too thin in Callus.
And it was too thin because none of the tenants carried on any production in the building and the claim of relationship to commerce being only that the few of the tenants elsewhere carried on for the manufacturing activity.
We think that the fact that the court below found it necessary to rely primarily on that decision, if not solely, is indicative of the error of its reasoning.
It -- it was impressed apparently with some particular language and particular language it was impressed with in that case was the independent enterprise -- that Callus was an independent enterprise serving a general miscellaneous customer.
Well, that language does appear in there and undoubtedly, that was one of the aspects of the case which led the Court to think that the – to rule, this Court to rule that the maintenance of the building was too remote from the commerce.
But there is absolutely nothing else in the Callus decision which is at all applicable to this case.
In Callus, neither the employer nor the employees were engaged directly in any interstate commerce.
It was just the same relationship which was all that was urged.
And if that language -- if that language cannot be taken out as a test of determining coverage of employees who were directly engaged in interstate activity, it's clear beyond doubt from the numerous decisions both from this Court and all of too many lower court decisions even to cite, holding the Act applicable to employees of businesses which are independent enterprises and which serve a general miscellany of customers.
Justice John M. Harlan: Could you address yourself with a little more particularity to the stenographers (Inaudible)
Ms Bessie Margolin: The stenographers there, well it was, the finding below was that there was constant communication required between the two offices and with out-of-state clientele.
They typed up the specifications and the explanations and I'm sure, Your Honors know what these bulky specifications are.
They did the typing, preparing of the -- of a great deal of materials in the specifications.
They handled the office calls, they made up the payrolls for both offices and for overseas employees, and it's -- in fact the District Court said it's freely conceded that the clerical workers engaged in -- in this -- regularly in this all with interstate communication correspondence and transmission of documents.
Justice John M. Harlan: Do you rely particularly as far as that -- they are concerned on the relationship with the specifications or do you --
Ms Bessie Margolin: We rely on both.
Because they --
Justice John M. Harlan: General correspondence for example, is that --
Ms Bessie Margolin: Well, in this case, we certainly don't have to rely on general correspondence although we say it's certainly related to the fact that this was an interstate operation.
But, they typed -- they actually typed up great part of the materials that went into the plans and specifications and they handled, they put the calls, all the interstate calls through as a private line between the two offices which was in constant use and they handled the interstate communications call.
And they took -- the Bookkeeper's took -- prepared the payroll for all the employees in the District of Virginia and overseas, they arranged for sending the checks out and I believe the Court is bringing the findings as they stated in the District's opinion as well as the Court of Appeals will see that there is considerable there besides mere correspondence.
Now, I don't want to shy away from that question because I think that if an employee is constantly engaged in handling the interstate correspondence for a friend, that that particular employee would be within the terms and coverage of the Act.
And I base that on the language of the Act and the legislative history too that this -- the language says every employer shall pay each of his employees and no employer shall fail to pay at any of -- of the employers for Section 6 and 7.
Justice William J. Brennan: Well, Ms. Margolin, I -- I gather by from what you said that -- and perhaps the stenographers and secretaries in law firms who do a great deal of typing of correspondence that goes in interstate channels?
Ms Bessie Margolin: I think if you have a law firm that has a substantial out-of-state clientele and does regularly or substantially have to use its employees for interstate correspondence and communications, I don't think the law firms themselves would be or have been shocked to learn that -- that those employees are --
Justice William J. Brennan: How do you find that?
Has the department --
Ms Bessie Margolin: The department has held that a law firm that -- that has substantial interstate clientele or substantial business where they have employees who are regularly used to handle that interstate correspondence and interstate communication, those employees are covered.
Justice Felix Frankfurter: How about the -- the Washington D.C. offices of New York and Chicago firms?
I suppose this -- I hope I know but I don't.
Does the statute apply in the House of the Districts without any problems of interstate?
Ms Bessie Margolin: I think that's explicit.
Justice Felix Frankfurter: I think it is --
Ms Bessie Margolin: I think it is --
Justice Felix Frankfurter: So my question is taken care of so to speak the clerical and stenographic reporter in Washington offices or New York and Chicago firms wouldn't raise (Inaudible).
Ms Bessie Margolin: I think if there's constant communication between the offices that they would be clearly covered.
Justice Felix Frankfurter: But I haven't -- but necessary if the Act applies to the different employees?
Ms Bessie Margolin: Oh, it doesn't apply to these internally.
They have the same --
Justice Felix Frankfurter: Well then they do have the same problem.
Ms Bessie Margolin: They have the same problem.
Justice Felix Frankfurter: And to pursue Justice Brennan's question have those situations administratively occurred namely, the clerical and stenographic reporter that -- I don't know how many in Washington's substations of New York and Chicago firms, San Francisco firms do that?
Ms Bessie Margolin: Well, we certainly have had the problem administratively and we held –
Justice Felix Frankfurter: They are covered.
Ms Bessie Margolin: They have -- we held they are covered.
The things that --
Justice William J. Brennan: (Inaudible) litigation about --
Ms Bessie Margolin: Yes.
There has been some litigation and -- and that some of the Districts Courts and some of the decisions were not on the opposing counsel have -- we have not instituted actions out there.
I think they are usually employee actions and a couple of cases that have gone off on the basis that it was just sporadic and related to one specific local, the Kelly Ford and Davis cases which where they have one specific local construction project and the correspondence related simply to that.
We have now as I believe -- I have been informed that we don't have trouble as to those that use employees continuously in interstate communication.
Now, the legislative history I think makes it clear that -- that Congress intended to bar to closing interstate channels of transportation, communication and transmission to close it to employment under substandard conditions.
And this language of applying it to each and any employee was very deliberately chosen over the employer language and -- insofar as anything was spared about closing the channels of interstate commerce, it was made clear that Congress intended to go and as Court has said to the farthest reach it intended to go to the constitutional limits of prohibiting any employer who wanted to use the interstate channels of commerce, transportation and communication.
Any employer who wanted to use -- to use those had to do so under the prescribed labor standard.
Justice William J. Brennan: Well, I gather on this record if that is correct on these facts that the coverage without reference to the question where the specifications and plans were goods.
Ms Bessie Margolin: There is certainly as to some of the employees.
Justice William J. Brennan: What about that?
And so I wanted to ask, there are standard rules that might not be true?
Ms Bessie Margolin: Well, it might not be true as to -- well, there are usually two or three grounds on each group of employees.
The field men have considerable interstate travel for example.
The draftsman I think would have to rely on the fact that they prepared materials for these plans and specifications and so the draftsmen would raise that in that problem.
I see that I have only about five minutes which I would appreciate reserving for rebuttal.
Chief Justice Earl Warren: You may.
Mr. Hofheimer, you may proceed.
Argument of Alan J. Hofheimer
Mr. Alan J. Hofheimer: Thank you Mr. Chief Justice, may it please the Court.
This is a case that has been brought with two parts by the Labor Department against an independent engineering and architectural firm just as local we submit as any architectural and engineering firm maybe.
It was started off in Norfolk and eventually enough business was produced up here in Washington to open a branch in Washington.
There are I think about 20 employers in Washington office now and about 30 in the Norfolk office.
Since the Washington office was opened, this firm has taken on some engagements overseas that as a subsidiary firm as or that one of the partners has been over there attending to it for the United States Government, for the army and it was stipulated I believe that those employees didn't enter into this controversy at all.
Now, the Department of Labor has built up a vast empire here or attempted to of architects and engineers who are doing business from one state to another and are doing business almost internationally.
We submit that the record doesn't show that, we submit that the stipulation doesn't show it and also, that seven of witnesses in addition to the stipulation that were put on in a District Court by the Labor Department did not bear out the Labor Department's intention in this respect.
It is purely a local firm with the Branch office in Washington.
Now, I said at the out set that the Labor Department had launched the two prong attack upon this firm and I say that advice only because –
Chief Justice Earl Warren: We'll recess now Mr. Hofheimer.
Argument of Alan J. Hofheimer
Chief Justice Earl Warren: You may proceed, Mr. Hofheimer.
Mr. Alan J. Hofheimer: Mr. Chief Justice, may it please the Court.
I think I -- I've said that the Department of Labor launched a two-pronged attack against that firm, the firm that we represent and I used that divisively for this reason that both in the trial court and in the Court of Appeals the Department of Labor stressed the point that plans and specifications were goods.
That was their main frontal attack.
They set out I think to prove that plans and specifications were goods if they could and of course they did not succeed in either tribunal.
Failing that, and as a second prong of the attack was the contention that the employees of this firm were engaged in commerce.
I note that in the appeal on the writ of certiorari to this Court the -- the seal has been slightly reversed and now the first frontal attack is that the employees are engaged in commerce and secondly, we meet the issue that plans and specifications are goods.
I should like to say at outset that -- and I think it should be clearly understood, that our clients in this case, the respondent -- respondents are independent art -- architects and engineers.
Case after case in the various Courts of Appeal have been resolved, some one way and some the other where draftsmen and chainmen and other people who do the same type of work that our employees do who are employed by contractors.
I think there is not a large contractual firm that doesn't employ chainmen and draftsmen and other people similarly to those employed by an independent firm, but we think that under the Act, it's very important to bear in mind the fact because we get to the question eventually of remoteness to bear mind in the fact, that the firm that we represent the defendants in this case as originally brought, do not participate in any construction whatsoever.
They -- there's no evidence in the record of their having any job site engineers and there is no evidence in the record of their participating actively in any construction work at all.
Now with that as a background I should like first to direct my argument to the question of whether or not plans and specifications are goods under this Act.
I'd like to say here that I do not believe that there's a single court in the country that has held that plans and specifications are goods.
Justice William O. Douglas: Well Brown case in the Circuit Court.
Mr. Alan J. Hofheimer: In the Brown case Mr. Justice it was particularly held in the last sentence of the Brown case that we will not pass upon that point because we will hold that the employees are engaged in commerce and the judge in the Brown case particularly said that he wouldn't decide whether or not plans and specifications are goods.
He wasn't called upon to pass on that fact.
The case that we think is the leading exposition, in other words, in the Brown case -- we think the case that is the leading case on this point in that it discusses the matter or one of the leading cases because Judge Learned Hand did in a case dealing with the -- not with plans and specifications but with a -- a similar typewritten manifestation.
In the -- in the case that the appellant refers to as the old Turpin case, which is a District Court case decided by Judge Chesnut down in Baltimore.
He went into the matter in great detail and we think with a great deal of effectiveness and conviction and with the Court's permission I should like to read what Judge Chesnut said.
This is case is McComb against Turpin.
It's in 81 F.Supp. 86 and I'm reading from that brief.
Judge Chesnut with impressive clarity and reason then he explained why plans, drawings, and specifications are not goods.
They are only a physical embodiment in words of professional conclusions.
The opinion continues in the words of Justice Holmes in Federal Base Ball Club of Baltimore against National League of Professional Base Ball Clubs, 259 U.S. 200 and I quote, “Personal effort, not related to production, is not a subject of commerce.
That which in its consummation is not commerce does not become commerce among the States because the transportation that we have mentioned takes place.
A firm of lawyers sending out a member to argue a case, on the Chautauqua lecture bureau -- or the -- or the Chautauqua lecture bureau sending out lecturers, does not engage in such commerce because the lawyer or lecturer goes to another State. Certainly the word goods could not be construed to include professional advices and its definition should not be construed to include the type-written or mechanical expression by which the advice is given.
Now that was the opinion of Judge Chesnut on plans and specifications which we think is the only case that we have been able to find and I think our adversary certainly would have found the other if he could tell the other way, this is the only case we've been able to find, dealing directly with plans and specifications.
Justice John M. Harlan: If the Secretary's contention were accepted in this respect would that sweep under the Act all of these employees or only some of them?
Mr. Alan J. Hofheimer: I think it will probably sweep them all --
Justice John M. Harlan: Including --
Mr. Alan J. Hofheimer: It would try to sweep under it all of the --
Justice John M. Harlan: Including the field -- or field men or the field representatives?
Mr. Alan J. Hofheimer: I should say it would, yes.
If plans and specifications are goods I think it would keep everybody and the employee under that.
Certainly it wouldn't include the professional employee that they're specifically exempt.
Justice John M. Harlan: No.
Mr. Alan J. Hofheimer: But I think it would include the field men.
Justice John M. Harlan: Or non-professional.
Mr. Alan J. Hofheimer: That's correct yes.
Justice John M. Harlan: Irrespective of whether they worked on the plans themselves -- or had anything to do --
Mr. Alan J. Hofheimer: Well, I think as a matter of fact, if -- that question will have to be resolved I think as to whether not the work is remote on that -- whether it's in a direct causation, whether it's directly essential or not, but the I think if plans and specifications are goods, we certainly from time to time send some plans and specifications across state lines.
Now, we don't do much of that.
Most -- most of that which is done by our client is done by the Government, but we do some of it.
I think the record will show and in our brief that we do a little bit in 2% of cases do we send plans and specifications across the state line, but if plans and specifications are goods, I would say that -- engaged that the -- that we ship them across the state lines in 2% of the cases.
Justice Felix Frankfurter: What about the arresting telegram -- arresting in the --
Mr. Alan J. Hofheimer: We think that the telegram in the Leonard case well, we omit in our brief and Judge Soper met that in his opinion.
We think that the telegram is a subject of commerce undoubtedly.
And we think --
Justice Felix Frankfurter: That is goods?
Mr. Alan J. Hofheimer: Sir?
Justice Felix Frankfurter: Goods, goods have very expansive meaning to the telegram is goods for the -- for making up a telegram.
Mr. Alan J. Hofheimer: Well the Court held that is was the subject of commerce and therefore came under the Act.
Of course -- that was the Child Labor Act I think it was in term then, but the difference, but the distinction I think is -- is that if we were representing a firm that was preparing plans and specifications and advertising in magazines for sale, we would think then that we would be producing -- goods under this Act.
But we say that all we're doing is the same thing that a lawyer does when a he gives a written opinion that we're taking the professional expression of a professional advice and resolving to a written instrument and that it has no particular value, no value at all except for the person for whom it is prepared.
Now that isn't true with the people who were sent out selling, compiling and selling standard plans and specifications --
Justice William O. Douglas: Lawyer's secretaries are covered in the Act or do they not?
Mr. Alan J. Hofheimer: We don't think the Act should cover a lawyer's secretary, no Sir.
We don't think so because we think that is too incidental to what she does.
We think that it is not directly essential to the works of a lawyer.
It's -- it's -- and we would like to -- I'd like to deal with that in a moment if I may, Mr. Justice if you want me so.
In the meantime --
Justice William O. Douglas: I suppose that the Act would have been better if the lawyer's secretary in a state board and resumes.
Mr. Alan J. Hofheimer: Well of course, Your Honor, it isn't because these do too.
As Judge Chestnut said in his opinion, this is not the mischief that the act was meant to remedy.
There isn't anybody being employed of -- of -- who doesn't make a lot more money than you would ordinarily expect a minimum wage employee to make.
The point is at the time when they have overtime it makes you so (Inaudible) regardless of how much they making at the time.
Justice Felix Frankfurter: But if you go on that excess you will get it from the company.
Mr. Alan J. Hofheimer: On that so on that --
Justice Felix Frankfurter: But the amount of money that seem --
Mr. Alan J. Hofheimer: I know that but I just -- we're not dealing on that pay --
Justice Felix Frankfurter: I can think of -- some of the figures I've seen of lawyers' exempted (Inaudible) were not lawyers or professionals.
Mr. Alan J. Hofheimer: Well --
Justice Felix Frankfurter: If we can do it -- go into that then we must.
Mr. Alan J. Hofheimer: Now, along that line in as to why these plans and specifications are not goods I would like with the Court permission to quote a small portion of Judge Soper's opinion in the Court of Appeals because we think that deals directly with this question and as expressed (Inaudible) we ourselves can express and I'm recording this is from page 147A of the record.
Certainly the words “goods” could not be construed to include professional advices and its definition should not be construed to include the typewritten or mechanical expression by which the advice is given.
These plans, drawings and specifications are not themselves the subject of border or sale but only the written embodiment of professional advice incidental thereto -- and incidental thereto.
They are specifically prepared to meet the particular problem of specific plan and are not sold or offered for sale to the public generally.
They are of course quite unlike stocks, bonds, and commercial paper which call themselves instrumentalities of commerce, Bozant against Bank of New York.
This distinction was well made by Circuit Judge Learned Hand in the case cited the 156 F.2d 789 as follows.
Some of the activities which went on we agree should on no theory be counted.
A lawyer who in the course of his practice writes letters or draws deeds or wills, (Inaudible) in the record, is not on that account within 203 (j) and the same as true of the correspondence of a broker and of a banker.
And if Your Honor please that, is we come to that -- we think would obtain to lawyers analogous as well as to us analogous too incidental.
The definition of goods in 203 (i) might literally go so far even as that, but it would be unreasonable to the last degree to suppose that Congress meant to cover such incidents of a bidder whose purpose did not comprise the production of goods at all.
And if Your Honor please that we think it disposes of the question and we think it disposes of the question of whether or not plans and specifications are goods.
We think the Judge Chestnut's opinion and Judge Hand's opinion in the absence of any opinion to the contrary leads us to believe that it's just with these two judges -- that they are just what these two judges say they are, typewritten manifestation or expressions if you will of professional ideas.
Chief Justice Earl Warren: But Mr. Hofheimer can you be a little more -- a little more than that here didn't work these plans and specifications that went to the Government distributed to -- to prospective bidders and didn't the prospective bidders use those in determining whether they were going to bid or not and how much they were going to bid and then when they did bid then they used those in the construction of the building, isn't that a little more than just professional advice?
Mr. Alan J. Hofheimer: Well of course the -- the plans and specifications that we turned over to the Government the government did send from place to place to get contractors to bid on it.
They sent them themselves, but we don't think that that means they are goods as far as we're concerned.
There were no great benefits, if the Government wanted to build a particular way to the particular place and we do a planned specification for it which we did as a part of their advanced planning, in many instances the place was never built at all.
Now our professionals -- professional men of the firm would get paid for those plans and specifications.
What the Government did with them we don't know.
We do believe and I think the record shows -- I mean it's not about business.
We know as a matter of practice the Government very often distributes them for bids.
I mean they mail them and they (Inaudible) for bids, but that was accurate that left our ends.
Now we did that to vary and we did -- the clients themselves would do that, but the plans that we turned over to the Government was ours, but we don't think that's the same as making them -- that that makes them goods.
We think still what Judge Chestnut did, we're still with Judge Hand said that it's a professional thing and after all professionals are exempt under the Act.
Now if the professionals who in -- in architects and engineers engrave them, those professional men make plans and specifications.
They have them prepared in their office or do it themselves in some instances they do, you can't afford (Inaudible) and then they send those and have them blueprinted.
Now we don't think the fact and we don't think if there's any law anywhere although the Labor Department contends that that makes them goods just because anymore than a lawyer's brief would be goods.
They're no goods as I said to anybody except to particular person who is employed with professional architect and engineer for that particular work.
Chief Justice Earl Warren: Is that the lawyers who -- who have a national business for instance who are exempted from this Act that is, they're employees who are engaged in these this services?
Mr. Alan J. Hofheimer: Yes all professionals are exempt for a sale.
Chief Justice Earl Warren: But I mean they're -- they're employees.
Mr. Alan J. Hofheimer: Well, we know of no administrative case where -- that there was no administrative case that have been brought to our attention where a lawyer's secretaries have been placed under the Act.
Now maybe sometimes they have no -- they're no -- there's no case of -- I don't think there's no reported case of any such things that have occurred.
We -- we contend that if -- if our plans are brought under the Act that -- that there is no professional exempt.
Lawyers and doctors and artists, the man who paints the picture and the lawyer who draws a brief and the doctors who performs the operation and who makes the autopsy all of them must read into the laws of Fair Labor Standard Act.
I don't think that you can make (Inaudible) and we don't think of courts (Inaudible).
We just think that those fine lines that have been drawn from time to time between cases would just be eliminated so far as professions are concerned.
Justice John M. Harlan: Are you talking of the meaning of the professional fees (Inaudible)?
Mr. Alan J. Hofheimer: No sir.
No Your Honor.(Voice overlap)
Justice John M. Harlan: Known as their employees?
Mr. Alan J. Hofheimer: Yes, Sir.
Absolutely, yes sir.
Chief Justice Earl Warren: And by the same reason that the employees of your client are not under the Act, no employees of professional people would be under the Act, is that to follow?
Mr. Alan J. Hofheimer: No, sir we don't think it does follow for this reason as I said earlier and that we think that a construction company does it engage directly engaged in -- referring to an instrumentality of commerce.
Now we think that a -- a professional man will say who was engaged or who gets up with business of selling plans, you see them advertised in all the magazines, standard plans, standard blueprints and specifications for homes on certain-sized lots.
Now we think if they are employees and are invariably engaged in the production of goods for commerce that they should be under the Act.
But we don't think that a lawyer's stenographer should be under the Act and we think it has not been intended by Congress.
I mean the -- from the Walling case on who this Court has time and time again said that Congress did not make this Act all extensive.
Judge Learned Hand said so that they fiddle, but they didn't and until such time as they do we think that employees such as we represent are intended for exemption.
Justice Felix Frankfurter: Mr. Hofheimer, this might bother you.
If I heard it correctly, indicated that as a matter of administrative application, this has been applied to out-of-state law officers, to their stenographers and --
Mr. Alan J. Hofheimer: Well, Mr. Justice Frankfurter, we're in no position to affirm or deny that.
We don't know.
Justice Felix Frankfurter: And I don't mean to say that that would be controlling on you -- I just --
Mr. Alan J. Hofheimer: No sir, but we've never seen any of that.
Justice Felix Frankfurter: And -- an acceptance and she also indicated that if the lawyers presumably they would have agreed, unless it's too trivial, unless they make so much money, it's doesn't matter.
I wouldn't know about that but they don't contest it.
They didn't expect lawyers to contest something to that.
Mr. Alan J. Hofheimer: Well, that is a matter -- served in last but usually within her knowledge and the knowledge is very far, the reason I'm not in a position to deny it.
Justice Felix Frankfurter: Anyhow, that's into the Court.
Mr. Alan J. Hofheimer: Well we do say that we know nothing about it and I do say that as far as any law which is in my hometown is concerned, I've never heard of any them for being approached by the Department of Labor to find out whether they are secretaries working more than 40 hours a week.
Justice Charles E. Whittaker: Mr. Hofheimer, do you make any claim that a law office or an engineering office is a service establishment --
Mr. Alan J. Hofheimer: No sir.
Justice Charles E. Whittaker: You do not?
Mr. Alan J. Hofheimer: No sir.
In fact it's accepted (Inaudible) Now, with the Court's permission I'd -- I'd like to proceed with the question as to whether of not our employees are engaged in commerce.
We contend that they're not.
In the first place, as I pointed out, we are not engaged in any construction work.
We are independent, professional architects and engineers and that what we do for anything that is, has an interstate characteristic or aspect is too remote from it, by virtue of our insulation from it to be included within the Act and I should like with Court's permission just to read a -- a few lines from the Callus case to which with Ms. Margolin referred in regard to that aspect of the case and a part of this opinion was quoted by Judge -- Judge Soper in his opinion.
Unknown Speaker: Is it the (Inaudible)
Mr. Alan J. Hofheimer: Yes sir.
Merely because an occupation involves a function not indispensible to the production of goods in the sense that it can be done without, does not exclude it from the scope of the Fair Labor Standards Act.
Conversely, merely because an occupation is indispensible in the sense of being included in the long chain of causation which brings about so complicated result as finished good does not bring it within the scope of the Fair Labor Standards Act.
In giving a fair application, I'm reading on page 582 of the opinion, in giving a fair application to 3 (j), courts must be remember that the necessary, in a phrase, “necessary to the production of goods for commerce” is covered by the context not only of the terms of this legislation, but of its implications in the relation between State and national authority, Kirschbaum against Walling, for as it pointed out Walling against Jacksonville Paper Company, we cannot be in module with Congress in enacting this statute plainly indicated its purpose to leave a local business to the protection of the states.
We must be alert therefore, not to absorb by adjudication essentially local activities that Congress didn't deem fit to take over by legislation and then skipping a sentence, we come to the part that Ms. Margolin referred to as being incorporated in Judge Soper's opinion, “Mere separation of an occupation from the physical process of production does not preclude application of the Fair Labor Standards Act, but remoteness of a particular occupation from the physical process is a relevant factor in drawing the line.
Running an office building as an entirely independent enterprise is too many steps removed from the physical process of the production of goods.
Such remoteness is insulated from the Fair Labor Standards Act by those considerations pertinent to the federal system which led Congress not to sweep predominantly local situations within the confines of the Act.
To assign the maintenance men of such an office building to the productive processes because some proportion of the offices in the building may, for the time being, be offices of manufacturing enterprises is to indulge in an analysis too attenuated for appropriate regard to the regulatory power of the States which Congress saw fit to reserve to them.”
If Your Honor please we think that insulation that was spoken of in that case with those maintenance men also applies to us.
There's no direct relationship between our work and the contractors who build the goods.
We think that it's just as remote as the -- as are the maintenance men in Callus case.
I will like in a few many minutes to the elect for me to distinguish this --
Chief Justice Earl Warren: May I ask you just one more question Mr. Hofheimer.
Mr. Alan J. Hofheimer: Yes sir.
Chief Justice Earl Warren: In -- in your clients' character as engineers, do they do any supervisory work on any of these jobs?
Mr. Alan J. Hofheimer: None for the Government at all.
Chief Justice Earl Warren: Well how about others?
Mr. Alan J. Hofheimer: In view of the 30% above other people incidentally the Government was that 85% in Washington, 60% in Norfolk.
Now, the testimony of one of the witnesses was, one of partners that about 50% of the other work that was, they had supervisory, they had supervisory contract for -- but all that supervision is done by a professional man.
Chief Justice Earl Warren: Yes, but when they -- when they do this in other -- in other States, don't they use the plans and specifications?
Mr. Alan J. Hofheimer: Well, I don't think there's any evidence if they'd done that in other States.
I mean, most of their work is local in nature and they don't, where they furnish supervision, they furnish no supervision in Government contract at all, where they furnish supervision, it is -- it is done by -- by a partner or at least a professional employee who is exempt anyhow.
Chief Justice Earl Warren: I know, but he'd be used in the work, would he not?
He'd be using the goods if this --
Mr. Alan J. Hofheimer: Well do they --
Chief Justice Earl Warren: -- that these other people have produced these plans and specifications.
Mr. Alan J. Hofheimer: There's no doubt, yes.
Chief Justice Earl Warren: Yes I just wondered.
Justice William J. Brennan: Does that mean that it assures the Government if the project's outside of the (Inaudible)
Mr. Alan J. Hofheimer: Well, on occasion, there isn't any element in here it having been done this way.
I couldn't say that it isn't, but there isn't any evidence of any supervision that was done for instance in Washington outside of Maryland where that's over the west end of the Washington office almost is on a -- a residential sewerage thing.
It was constructed in Maryland and if any supervision had furnished that -- of course it's done outside of the district.
I think there's no evidence of any supervision done by the Norfolk office outside of Norfolk.
But as I say if we did, it would be done by a professional man who would be exempt.
Now, the case, and the only case that we know of and the only case that the Government has produced in support of its position is the Eight Circuit case, the Brown case and I would just like to read just one part of the Brown case that I think distinguishes from this case completely.
And the Judge said, he spoke about the Fair Labor Standards Act as constituting in Laudadio against White.
And, that was the case where the draftsmen in that case were employees of a contractual firm.
So here, now this is a judge, and this is a case that held and the only case we know that held that an independent engineer was under the Act.
So, here defendant employee's preparation of plans and specifications for the repair and improvement of existing instrumentalities of commerce together with the activities of the resident engineer at the actual job site was sufficient to bring him within the coverage of the in commerce rights.
Now we submit that we have no evidence in this record about having done any work on an existing instrumentality of commerce nor is there any record, any evidence in the record about having ever had a man at a job site a resident engineer at the job site to supervise construction.
We just don't do it.
We have never done it and there is nothing in the record that says we did that.
So we submit that -- that this independent profession firm is not producing goods in commerce and it's too remote to be considered as an employee engaged in this.
Chief Justice Earl Warren: Ms. Margolin.
Argument of Bessie Margolin
Ms Bessie Margolin: I have a slight amendment to make to my statement as to draftsman here would be covered with -- with the good point would necessarily be drawn into it and we also of course rely on the Eight Circuit's decision that the plans and specifications are -- are a part of the improvement to the interstate instrumentality for which they're specifically designed.
Now, we do not construe the Eight Circuit as having limited itself to the case where the -- resident engineer goes out.
They very -- made it very clear that they regarded the plans and specifications as a part of the improvement project because every detail is guarded.
Every detail of the -- of the construction, the materials that go in to the construction are guarded by these plans and specifications, but I do want to spend a little time on the good point because it's unquestionably is the as counsel, my adversaries conceded that if these plans and specifications are goods that in itself would -- would cover all the employees involved here.
And we think that the -- it's so clear that they are goods, that even the way respondents themselves have treated them are goods that that alone should be sufficient to hold the -- that there is coverage here.
Justice John M. Harlan: Where do you find over and I want to say this was a good time but why is it the goods to be is covered with --?
Ms Bessie Margolin: The draftsmen?
Justice John M. Harlan: No, not the draftsmen, the field -- the field men.
Ms Bessie Margolin: Oh, they gather the -- they make the surveys and gather the materials which are then incorporated into the blueprints and the drawings and the plans.
There -- may do -- they actually do the work that goes into those plans then those are shipped into state of course, the plans themselves.
Now the -- in the stipulation it stipulated these plans and specifications are called property.
It's stipulated that they become the property as when they are prepared for the Government projects.
They become the property of the Government.
It's stipulated that for private concerns, they remain the property of the respondents and copies are given to the clients so that they can use them later if they need repairs on their project.
Unknown Speaker: Is the property in terms of goods?
Ms Bessie Margolin: Well, but now the definition of goods in this Act was certainly broad enough to cover any kind property.
Now we ask the Court to consider what Judge Soper's reasoning was.
This -- his first reasoning and he rested largely on the Turpin case which was the District of Maryland which was decided some four years I think before the Powell decision came down.
The Powell decision made it very clear that the Act was not limited to articles of trade.
Western Union had already made it clear, it's true.
That this was -- what not was so limited, it was specifically amended, the definition of goods so as not to limit it to all articles of trade and in Powell, this Court said Congress was concerned with eliminating widespread existence of substandard working conditions which could be reached by Congress through its through interstate, through its power to regulate interstate transportation of the products of those conditions.
In other words what Congress was concerned with was the work product of substandard condition -- of substandard conditions and there's no question but what these plans and specifications are the work products of employees who are doing routine work, they're the same kind of workers that Congress was concerned with and in fact that the plans and specifications are not merely the architect's ideas or the engineer's ideas.
They're the composite of the work of ordinary laborers and the architect and what seems to be obvious here is that because professional people supervise these ordinary laborers, ordinary employees that therefore the employees should be exempt their -- as these professionals here.
Justice Felix Frankfurter: May I ask one question before you sit down, Ms. Margolin.
The definition of goods after giving, reciting various categories of what it means to be goods, and all of which I want to understand where products, commodities, merchandize or other -- or subjects of commerce of any kind.
Ms Bessie Margolin: Of any kind.
Justice Felix Frankfurter: What I want to know is whether subject of commerce of any character is the inclusive category which obtained everything else.
Ms Bessie Margolin: Articles are subject.
Well, they put --
Justice Felix Frankfurter: Articles or subjects of commerce.
Does that mean regulations under the Commerce Law are subject to commerce?
Ms Bessie Margolin: I think that they're intended to mean where anything that was regular both under the Commerce Clause.
Justice Felix Frankfurter: Yes but we've held the and you well know (Inaudible) -- isn't that extensive as the Commerce Clause?
Ms Bessie Margolin: Yes and I -- and we in out reply brief as I think have undertaken to answer that argument which we think misled the Court and has misled a lot of -- of other people and with choosing as administrative extent.
We've gone into them -- which -- which may be the forgotten legislative history to show what -- what Congress did intend to limit us to and we did recognize that the -- that the Act is not co-extensive with the constitutional power but the statutory language that Congress showed insofar as they did go, they did intend to go the whole way and this Court has said so repeatedly.
Justice Felix Frankfurter: Well that's -- that's something said in the opposite in Kirschbaum which enforces it.
Ms Bessie Margolin: Well, I don't think so.
You pointed out --
Justice Felix Frankfurter: It's included.
Ms Bessie Margolin: You pointed out in Kirschbaum that Congress did not go the whole way and you pointed to the fact that they have dropped the effect in commerce language and they had also dropped the specific provision which would have covered intrastate production, producers who do not sell across state line but who would be covered because they competed with interstate producers.
Those are the two things the Kirschbaum opinion referred to and we point out that those are the two things that's about all that Congress intended was the -- not to get the intrastate producers because everything else is specifically exempted.
It did take out that provision based on the Shreveport case but then they're adapted.
Now the effect in commerce language was in the house bill and all these we have gone through for the benefit of the -- of the Court we have put it in a our reply brief and I think that the net result the Court will see that actually the Act adopted, went much further than any previous bill except for dropping the Shreveport Doctrine.
Justice Felix Frankfurter: Now I happen to know what I get from your reply is that the phrase or subject of commerce of any character were intended to construe -- to convey that the legal term subject -- subject of anything that under the Commerce Clause maybe regulated by commerce short of the Shreveport Doctrine, was there?
Ms Bessie Margolin: Well, subject -- well, subject of commerce and as commerce is defined in the Act which is transportation, communication, transmission and thirdly these plans and specifications are subjects that can be transported across state lines and all.
Justice Felix Frankfurter: Do you think Jefferson would regard these -- these architectural plans as goods under this definition?
Ms Bessie Margolin: I don't think that I doubt if he was -- that he was engaging in this type of industrial act or -- this production.
Justice Felix Frankfurter: That architects who are doing that protection --
Ms Bessie Margolin: Well, of course I think he might have regarded it as such if He would -- using it in industry and --
Justice Felix Frankfurter: And does the Court -- (Voice overlap) and this -- were adopted as you are --
Ms Bessie Margolin: But I think there's no doubt that Congress changed that language to -- to get beyond just ordinary articles.
Now Judge Soper says nobody would ordinarily think of it as saying – goods, but this Court had said specifically that Congress adopted unusual definition here and they take precedence over the ordinary colloquial use -- usage and as I say that there's no question but what plans and specifications are used for a lot of things and they all sometimes show that they were regarded as property and valuable property.
And on --
Justice Felix Frankfurter: It's in the act that the commerce -- it can out of the commerce enforcement. Jefferson's draft told by some of these or by the auctioneer from New York that they are Articles of Commerce.
Ms Bessie Margolin: Well, if you're talking about the commerce in the commercial sense which I think Judge Soper was too which doesn't apply here.
I think the subject -- if -- it read before Articles of Trades and Congress took out the trade and said subjects of commerce of any character.
And I think that was done deliberately to -- because they wanted to get a broad coverage in this Act.
They didn't -- they want to keep within the constitutional scope and so -- insofar as it was limited, Congress -- it's obvious from the debates that it limited it only it thought it might get into trouble constitutionally.
Justice Felix Frankfurter: If you ask us to take this case because of it's conflict with Brown?
Ms Bessie Margolin: That was one of the grounds.
The other was of its importance because there are so many architectural or engineering firms that -- and many employees that are affected.
Justice Felix Frankfurter: But the conflict point was in this or not?
Ms Bessie Margolin: The conflict point was involved.
The Eight Circuit did not decide the goods point but they held that the plans and specifications were so closely and vitally indispensable.
It's admitted here that the type of structures on which respondents for which they prepare plans couldn't be built without these -- without these plans.
They -- they get every detail of the building and the materials and everything else from the plan and Eight Circuit held that -- that anything that close to the actual instrumentality and its improvement is a part of it.
Justice Felix Frankfurter: Why did they raise it in parenthetically moving the equipment, do you know?
Ms Bessie Margolin: Marine equipment.
Justice Felix Frankfurter: Goods including marine equipment.
Ms Bessie Margolin: I don't -- I don't -- I've never looked up the legislative history of that.