FRY v. UNITED STATES

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Argument of John A. Brown

Chief Justice Warren E. Burger: We'll hear arguments next in 73-822, Fry and Boehm against the United States.

Mr. Brown, you may proceed whenever you're ready.

Mr. John A. Brown: Mr Chief Justice, may it please the Court.

Excuse me for not getting up, that's something I do less well.

We are here today on a case that is at least in our judgment, extremely important to all 50 states.

We are here on a petition for writ of the certiorari granted by this Court last February.

The matter all began in the State of Ohio.

The Ohio 109th General Assembly passed a bill, Amended Substitute Senate Bill Number 147 and it was signed by Governor Gilligan, and to be effective on the first day of the pay period which included January 1, 1972.

The bill provided for a pay increase for all state employees of either 38 cents per hour or 10% whichever was more.

It averaged out to be a pay increase of roughly 7.7% for all state employees.

After the statute was passed, signed by the Governor, the State of Ohio asked the federal pay board for authority to pay the increase, the Ohio General Assembly have enacted.

The Pay Board heard the petition, granted the authority to make the increase effective March 10, 1972.

So there was a period of roughly two and one-half months when the pay increase was not paid.

The federal pay board decided that the amount that would be paid starting from March 10, 1972 through the remainder of the buying in would equal an amount that will be consistent with the federal Pay Board standards.

Thereafter, we filed an action in mandamus in the Supreme Court of which we asked the Ohio Supreme Court to order direct the state officials to pay the increase that the Ohio General Assembly said they should pay.

The Ohio Supreme Court issued a mandate that we requested.

Immediately, the federal government sought and obtained a temporary restraining order from the Federal District Court in Ohio which was then continued by the Temporary Emergency Court of Appeals here in Washington.

And when the matter came to the Temporary Emergency Court of Appeals they ruled that the pay increase was beyond the scope of Ohio to get that the State of Ohio was enjoined from doing what the Supreme Court of Ohio had ordered the Governor and the order to do.

We then found our petition here under the Tenth Amendment of the United States Constitution and we filed the motion of not as an academic matter but because we seriously, honestly contend that the Tenth Amendment to the United States Constitution prevents the federal pay board and the Temporary Emergency Court of Appeals from doing what did they do.

Now, after this Court granted the petition last February.

The United States has filed a motion asking that the writ now be ruled to have been improvidently granted to use the words of the Solicitor General.

They argued that even though that since the decision of the TECA.

A situation has occurred in California in which a situation very similar to this occurred.

When the California General Assembly has to pay increase for its employees and the California Governor went to the Pay Board as the Ohio Governor again, got authority which was only partially what the statute said.

The California employees went to the California Supreme Court in mandamus as the Ohio did.

The California Supreme Court granted the writ and again as the Ohio did.

Then the federal government filed a petition for an injunction in California, again as it did in Ohio.

The injunction was granted.

And thereafter an appeal was taken to the TECA and to the Government surprise or with (Inaudible) surprise.

The TECA reversed in the Cohen case and California saying that the reason they reversed is the injunction was applied for on May 14, 1974 which was two weeks after the Economic Stabilization Act had expired and we understand although it's not in the record that the Government has filed a petition for writ of the certiorari in that case.

And it seems to us anomalous to say the least that the Government one on the one hand contend that our writ should be dismissed as being improvidently granted.

And on the other hand, contend of the case of almost exactly similar important should be admitted by this Court in Cohen versus California.

We --

Unknown Speaker: Mr. Brown, did I understand you to say this now that you're understanding that the Government has or plans to file a writ of certiorari to review the judgment of the Temporary Emergency Court of Appeal of September 19, 1974 in the case of the United States of America against the State of California?

Mr. John A. Brown: That's what I understand.

Unknown Speaker: Because I was going to ask you, now that I've interrupted that what -- the fact is assume that the decision in the California case of the Temporary Emergency Court of Appeals remains undisturbed.

What effect would that have upon the viability continued importance or even continued viability of your litigation.

As I understand it here, under this decision I made, you tell me if I'm mistaken, your clients will get everything you're asking for, would they?

Mr. John A. Brown: Well there is no question but that when the TECA acted in our case, they acted on expired so that the injunction that once they issued remains in the Cohen versus California.

TECA decided that the application for the injunction came two weeks after the active expired so that I think the answer is that Ohio was enjoined and California is not.

Unknown Speaker: Is that the reasoning of this Court of Appeals?

Mr. John A. Brown: Of the Emergency Court of Appeals, I think so.

Unknown Speaker: You talked about the enforce -- on enforcement proceeding.

I have plans for this, I am very carefully but I -- do you think therefore that this assuming that this decision remains unchanged, that it would have or it will give your clients no benefit at all?

Mr. John A. Brown: Not in the present posture.

We would have to do something more than it has been done.

Now, I think I'm obligated to say to the Court.

That we filed an action six weeks ago in the Ohio Supreme Court again asking for another mandate saying, “Pay the money now”.

Now, if the Supreme Court of Ohio in December 1974 or February 1975 issued another order to Governor Gilligan and Auditor Tracey and said, “Pay the money now”.

Unknown Speaker: It wouldn't be Governor Gilligan in February 1975?

Mr. John A. Brown: As a great plenty of my friends have reminded me that it's true.

And said Governor Rhodes pay the money or Auditor Tracey pay the money, right to pay the money.

The federal governor would not be able to enjoin that mandate unless it would be interpreted that the order of the September 1973 from the TECA was broad enough to cover what the Supreme Court might do later.

Unknown Speaker: But certainly that's not going to be your position?

Mr. John A. Brown: That's true.

Unknown Speaker: In that litigation?

Unknown Speaker: At least they could give a prospective wage increase without interference by the federal government now.

Mr. John A. Brown: True.

Unknown Speaker: And make up for it did directly that way assuming they had the same employees that they had before.

Mr. John A. Brown: Yes and of course the employees will be markedly different because we're talking about some 55,000 state employees and thereabouts.

In two years, they have changed markedly.

But the Ohio General Assembly could when it goes into session in January of 1975, grant a pay increase to in effect makeup for what the employees some 10.5 million dollars that they did not receive two years ago plus.

Unknown Speaker: Do they give a retroactive under Ohio law but your legislature now gave a retroactive pay allowance, Mr. Brown?

Mr. John A. Brown: I don't know the answer to that.

Unknown Speaker: Well, if they could then you take it anything of any barrier to that federal law?

Mr. John A. Brown: No.

Unknown Speaker: Or in this injunction?

Mr. John A. Brown: That I am not sure.

The injunction by its term and the Court will see on the last paragraph of the order of the TECA is very broad and how that might be interpreted to apply if the State of Ohio now tried to pass a retroactive pay increase, I simply don't know.

I would not like the question to occur.

Chief Justice Warren E. Burger: But if that were the general rule in periods when there were “pay freezes” it would make a mockery out of the efforts to control wages and crisis, would it not?

Mr. John A. Brown: I'm sorry I didn't hear all your questions.

Chief Justice Warren E. Burger: Well, if it is true that after a pay freeze is off such as we have during I think the Korean War and various other emergency periods.

If afterwards, employers could come along and make it out.

It was identified as such it wouldn't have very much meaning in terms of the power of the Government to deal with emergencies would it?

Mr. John A. Brown: Agreed and of course there have been ample presidents which say that if Company A and Labor Union B agreed that a pay increase will be made to employees of X dollars per hour and X cents per hour, after the freeze expires.

That agreement is no good at all.

Now the question about what would happen if Ohio now tried to retroactively do something in January or February of 1975.

I don't think it has been answered.

The point we want to emphasize most, we think in oral argument, is that what the TECA seem to say was that Maryland versus Wirtz decided by this Court, answered the appeal we made at the TECA a year ago.

We contended certainly does not that Maryland against Wirtz decided that the amendments to the Fair Labor Standards Act as applied to the state schools and state institutions for the mentally retarded, etcetera limited the states authority to act and that the FLSA amendment were constitutional but in both of majority and the minority or the majority dissent in Maryland against Wirtz.

There is a great deal of language indicating that if the United States Congress had in the FLSA, said that the minimum wage that the State of Ohio shall pay to all its employees shall be $2.20 per hour, that this would not have been permissible under the Tenth Amendment.

We maintain that you can agree the Tenth Amendment as having any meaning at all and say that the Congress of the United States may do that.

Now, the Chief Justice use many years ago in this Court said that the Tenth Amendment of the United States Congress is meaningful and to an argument that lawyers raised that if some act of the Congress was not restrained, it would harm the courts or harm the states and destroy the state (Inaudible) Chief Justice Hughes said “Not probably this Court sits.

But we submit that if here, the argument or the contingence of the TECA would be supported by this Court.

Then the Tenth Amendment will have very little meaning left in what normally Chief Justice Hughes but Justice Cardozo and many others had warned against would certainly be a current.

I would like to save what moments I have to reply.

Chief Justice Warren E. Burger: Very well Mr. Brown, thank you.

Mrs. Lafontant.

Argument of Lafontant

Ms Lafontant: Mr. Chief Justice and may it please the Court.

The Economic Stabilization Act was brought into effect in August of 1970 and expired of its own terms on April 30, 1974.

The Act under Section 203 authorized the president to issue orders and regulations to stabilize among other things, salaries and wages, at levels not less than those that were prevailing on May 25, 1970.

And pursuant to such orders and regulations, the Pay Board issued its own regulations which limited the annual wage or salary increase to 5.5% for all persons subject to the regulation.

On January 15, 1972, the Ohio General Assembly passed Senate Bill 147 known as the Pay Bill Act which provided for an average increase of 10.6% beginning January 1, 1972 for 65,000 of employees of the State of Ohio, the state universities and the county welfare departments.

Subsequent thereto, Ohio filed an application for the Pay Board for an exception.

They asked that they be permitted to pay the 10.6% increase but the Pay Board permitted them only to pay 7% from January 1, 1972 to March 10, 1972 but thereafter the Pay Board approved the increase in its entirety of 10.6%.

The Ohio Supreme Court pursuant to application of Ohio, issued writ of mandamus, commanding the officers of the state to pay the entire increases -- the officers of the State of Ohio to pay the entire increases.

The United States instituted this action and the United States District Court of the Southern District of Ohio to enjoin Ohio and its officers from paying out the increases that were in excess of those authorized by the Pay Board.

And the District Court restrained Ohio from paying the increases and the Temporary Emergency Court of Appeals issued a permanent injunction on October 25, 1973, restraining Ohio and its officers from paying these increases.

I might add that since the termination of the Economic Stabilization Act of -- on April 30, 1974 there's been no application by the petitioners for dissolution of that injunction which is still in full force and effect.

But mind you, the injunction was entered before the expiration of the Act.

Now this Court --

Unknown Speaker: Did the Government resist an application of dissolved (Inaudible)?

Ms Lafontant: Would we resist?

I would assume so based on the particular facts, we perhaps would resist it.

I think it would turn upon the briefings that are brought to us whether or not we would still be in good stead in resisting it.

We would still have the authority and we might not resist it but certainly we would have that right, and I can't see at this point whether we would or would not.

But I am saying that the petitioners were in the position at that time to move to dissolve the injunction because the Act was no longer in effect.

Now this Court has consistently refused to pass upon the constitutionality of the statute where at the time that it comes before the court, the statute has expired by its own terms or has been repealed or has ceased to be of any effect, and of course we know so many other cases that substantiate there and I have in mind in particular the Rice versus Sioux City Memorial Cemetery case where after this Court have granted a writ of certiorari upon learning that the particular state had repealed its law.

This Court dismissed the writ of certiorari for being improvidently granted.

At this point I would like to say too that the Government has not asked that this case be dismissed for being improvidently granted or exact languages that we wanted that we think it should be dismissed because it is no longer continuing importance.

Unknown Speaker: But either way it would leave the judgment of the TECA in effect, would it not?

Ms Lafontant: Yes it would.

And in the instant case, the economic stabilization expired on its own terms as I said on April 30, 1974 but of course this writ of certiorari was issued before that time.

Now beside the purely abstract question of the right of Ohio to pay wages to its employees without any restraints or interference from the federal government, the only matter before the court is the residual pecuniary interest of these employees to the amount of the money.

That is some $15 million and when spread over all of the employees amounts to around $200 or more for each employee.

The immediate restraint upon Ohio that prevents it from paying the money to the employees is the injunctive order of the Temporary Emergency Court of Appeals.

Because of the fact that the purpose of the Act and of the injunctive order, in support of the Act was to reduce during the effectiveness of the act supply of money in circulation by putting a limit on pay increases it would seem to me that a very substantial question of law is now raised and that question is whether upon the termination of the Act, application for dissolution of the injunction, should not be granted as a matter of right to petitioners. This is a legal question that should be determined.

We respectfully submit that at the expiration of the Act, the petitioner should have made application to the Temporary Emergency Court of Appeals for dissolution of the injunction.

They did not but instead they chose to pursue the attack on the constitutionality of the Act itself.

We submit that the constitutionality issue is of no longer continuing importance.

Thus writ of certiorari was properly granted because at that time, the act was in full force in effect but since it has been granted, the Act has expired and we say it's if no continuing importance, its not very likely that this case can -- this issue can arise in any other courts concerning wages and salaries for periods after April 30, 1974.

Justice Thurgood Marshall: Mrs. Lafontant, does your argument take any consideration what I read in the newspaper?

Ms Lafontant: I don't know what you're reading at the newspaper these days.

Justice Thurgood Marshall: Well prices are going up to the ceiling and this thing might be back in effect within a day or so.

Ms Lafontant: Well that's not before this Court at this point but I do --

Justice Thurgood Marshall: I can't forget it.

Ms Lafontant: I think a lot [Laughter] you cannot forget it.

What can happen in the future or what will happen in the future, I don't know whether or not there's going to be a further need for any kind of legislation like this.

I don't know who can say but I don't believe that this Court has to determine the constitutionality of an act that may be put into effect in some time in the future.

I think the Court has to act on what's before and of course if it can decide it without going into the constitutionality.

I think --

Justice Thurgood Marshall: If you get can get a better word than may, I might go along with it.

Ms Lafontant: Better word than may?

I don't know where I had the may at this point.

Unknown Speaker: Not before you resolve it?

Ms Lafontant: And second --

Unknown Speaker: Mrs. Lafontant, perhaps you already told the Court but if so I missed it.

Has the Government petition for certiorari or does it plan to from those --this September decision of the Emergency Court of Appeals?

Ms Lafontant: I can speak very honestly to you and when I read this in Mr. Brown's reply, I checked all over the department.

We have not filed any petition for writ of certiorari in the California case.

We have filed a motion for rehearing which is going to take place I think next Tuesday or Wednesday [Voice Overlap] hearing on that but we have not filed a petition for writ of certiorari and I think before we -- I could even answer that.

The department would have to look into all the aspects of the case to see if one would be warranted.

Unknown Speaker: Well, I suppose you wouldn't even begin to face that question until the Court acts on your petition for rehearing.

Ms Lafontant: That's right, that's right exactly and it hasn't.

We have filed our petition for rehearing.

Unknown Speaker: And that's under submission, is it?

Ms Lafontant: And I understand, yes.

I understand, let's hope that it will be heard Tuesday or Wednesday but I think at that time, we would make a determination with what we should do.

But we have not filed it and I was intending to clear it up a later but I'm glad you asked me that now.

Unknown Speaker: I suppose you feel this case as governed by Maryland against Wirtz.

Ms Lafontant: Yes, I do very much so but -- and before I got into that, I had one other issue I wanted to cover but would you prefer that I get into it now?

Unknown Speaker: Well I just wanted a flat answer and then --

Ms Lafontant: Yes, very definitely we feel that Maryland versus Wirtz is controlling and there was any interference into the role of state sovereignty that perhaps it was more interference in Maryland versus Wirtz than here.

But even before we get to that, as you may have noticed three of the amici raised for the first time in issue which was not raised by the petitioners.

They contended the Economic Stabilization Act of 1970 doesn't even apply to the states.

But since this was not raised in the petition, we don't feel that it's properly before the court but perhaps it does require some response.

And in any event we feel that both the language and the legislative history of the Act show that Congress intended to include state employees in this Act.

And I will turn to page 12 of our brief just to point to a few other things that was said that would indicate that.

The regulations define person to include any state or local government union, unit, or instrumentality of such government unit.

At Section 203 (b) (5), they speak of -- it sets out very definitely that the standards to be adopted governing acceptable level of wages and salaries, would recall for generally, comparable sacrifices by business and labor, as well as other segments of the population.

And further, when Senator Proxmire at the Senate Hearings prefaced his remarks when he was introducing a bill to have the states exempted.

He conceded that ordinarily higher salaries for state and local workers result in a greater demand on the economy and higher wages drive prices up, and that this is largely responsible for the inflation we're suffering.

But he tried to make a distinction --

Justice Harry A. Blackmun: How far may a state go in this respect or may Congress go?

Did Congress impose a ceiling on the state spending on state budget?

Did Congress say state salaries not only shall not be increased during this period but they should be lowered at 15%?

Would all these be valid do you think?

Ms Lafontant: I think it all would have to go back further to the question of whether it would be Congress would have a rational basis for determining that under the commerce power this is a necessity.

Chief Justice Warren E. Burger: Some 30 odd years ago, it seems to me the federal government reduced the salaries of all government employees some 10% or something of that kind.

Suppose in such a period they said this is across the board, all the federal employees, all public employees, everywhere else to pursue Mr. Justice Blackmun's question.

Ms Lafontant: You mean you said the federal government reduced it by 10% for --

Chief Justice Warren E. Burger: Its own employees and all other public employees.

Ms Lafontant: I think it would all have to go back to the question of rational basis and whether it was necessary under the Congress --

Chief Justice Warren E. Burger: Well, it doesn't need a rational basis to cut the salaries on its own employees does it?

Ms Lafontant: Oh!

No, of course not but in caring it over to the states.

Chief Justice Warren E. Burger: It wouldn't gain much weight for the state, a reduction of the states salaries although the fact that they reduce them for federal.

Perhaps some but not conclusive, would you agree?

Ms Lafontant: Yes, definitely.

It wouldn't have to follow.

Argument of Mr.juctice Rehnquist

Mr.juctice Rehnquist: Supposing to follow up another one on Mr. Justice Blackmun's questions that Congress decides that what we need to hold on or not, just wages but spending in general by states.

And so they said that no state during a fiscal year in 1975 could exceed its total expenditures for fiscal year 1975.

And there were findings that would pass the rational basis test that that would help in the exercise of commerce power of control over the inflation.

Now, do you think that's the end of the inquiry?

Rebuttal of Lafontant

Ms Lafontant: No I don't -- I think, if I understand your question correctly, I don't think Congress could set up in other words, the state's budget and say -- and control it completely and say that you can spend so much and know more.

Rebuttal of Mr.juctice Rehnquist

Mr.juctice Rehnquist: You don't think that even under the rational basis commerce part as they could set a ceiling on a state budget.

Rebuttal of Lafontant

Ms Lafontant: I don't.

I think we're getting pretty far.

We're getting to the question now as how far is too far and I think at that point, I would believe we were getting a little too far and it certainly it goes much further than this case or Maryland versus Wirtz.

Chief Justice Warren E. Burger: Perhaps Congress would try to accomplish that in a more --that result in the more practical way by saying it would terminate all federal grants in aid to states unless states conform with a certain policy on budget and get out around Robin's barn.

Ms Lafontant: I think even that might cause a problem.

Chief Justice Warren E. Burger: Some equal protection [Voice Overlap].

Ms Lafontant: It would fear perhaps I would think so.

Well Mr.-- Senator Proxmire in going further to show that the states, that the Congress really intended to include the states, offered his Amendment to specifically exempt from the act to salaries of the state employees.

And Senator Tower responded and that's on page 15 of our brief in the congressional record of 117.

Senator Tower said, “I don't believe it is fair to the other employees to single out one particular group for exemption.

I believe the state in local government employees should be subject to the same standards as other employee groups.

Unknown Speaker: You're reading from?

Ms Lafontant: It's Senator Proxmire, 117 Congressional Record, 43-673 and 43-677.

Unknown Speaker: That is -- is it in your brief or in the appendix?

Ms Lafontant: It's referred to.

Unknown Speaker: I see your reference on page 15 of your brief to the Committee's Report.

Ms Lafontant: Yes, that's what it is.

Unknown Speaker: And that's what it is.

Ms Lafontant: Yes.

And I might add that the Proxmire Amendment was defeated by the vote of 56 to 35, so it's no question in our mind that Congress intended to include the states under this Economic Stabilization Act.

And even beyond that, it's just inconceivable that you would think that congress would deliberately exempts a 14% of all employees when we were in such and emergency situation and we know what effect 14% of the population would have on the rest of the nation.

But they seem to make a lot of out of the fact that since states were not definitely set out in the Act that it was intended to omit them.

But we have cases that show that in Case versus Bowles is one of that shows very clearly, that just the fact that you did not include the word “states” doesn't mean that you intended to exclude them.

And the only question that is really before the Court because as I said, the three amici raised this and not the petitioner.

The only question presented in the petitioners where the Congress, under Commerce Clause constitutionally may apply economic controls over the wages and salaries of state employees.

Petitioners contend that if Congress intended to include the States then Congress is violating the Tenth Amendment, the sovereign rights of the States.

And they go so far as to say that by doing this, we're permitting the federal government to devour the essentials of state sovereignty.

Whatever may have existed with respect to the power of Congress under the Commerce Clause to regulate state activities has been decided by Maryland versus.

Wirtz , of course there where this Court established the validity of this exercise of congressional power in appropriate circumstances in the interstate commerce.

Unknown Speaker: Of course there were [Voice Overlap] that was on a minimum wage wasn't it?

Ms Lafontant: Yes, an overtime.

Unknown Speaker: Three years on maximum amount.

I'm still a little bit bothered if the Congress said to the State of Ohio, “You can pay your employees no more than $3.94 an hour” What about those that have been getting $5.00 an hour and the governor himself or something?

That the--did Congress do this?

Ms Lafontant: I think on the rational basis test except for--you could even extended that far, I would believe.

Except for the most times, I do exclude the administrative offices like governor or what have you but I would say that once it would open the door and if there was this emergency and if there was a rational basis for it, and in order to regulate the commerce among the states, and to defeat the inflation and fight an employment, I think the congress could actually do this.

But I think it has to be done on a case by case basis.

But I think in some instances it could accomplished.

Unknown Speaker: This rational basis test can 4120 there's a matter of congressional power under the Commerce Clause and the other -- and your brothers in the -- talked about the Tenth Amendment on the other hand.

Rational basis is something that sometimes used I think sometimes rather loosely and wrongly used in connection with due process, and sometimes perhaps equal protection.

But where is rational basis committed?

Ms Lafontant: Well, in the cases that I've been reading, even though there are some acts that say that you don't have to show a relationship.

I would believe that the courts would have the power to go behind the actions, the decisions of the Congress.

Unknown Speaker: Behind the judgment of Congress.

Ms Lafontant: To go if --

Unknown Speaker: To go farther than saying that this is within the commerce power of the Congress but nonetheless it's invalid because it lacks a rational basis.

I don't have any case that holds that?

Ms Lafontant: Well it would -- but there are cases to say that Congress, I mean, that court does not have to accept the final say of Congress.

Just because they say it's within the Commerce Clause.

Unknown Speaker: Do you think the taxing power and commerce power or the same I asked this because I think [Voice Overlap]?

Ms Lafontant: No, I don't think it's the same.

Unknown Speaker: Why should they be the same?

Ms Lafontant: And the cases -- maybe you're asking me why shouldn't they be the same or if they are the same, the court's have distinguished between the taxing power and commerce power?

Unknown Speaker: Those are quite separate constitutional provisions.

Ms Lafontant: Right and they're completely different.

The commerce power is plenary and goes much further.

Unknown Speaker: Well, the Constitution doesn't say it's plenary.

Rebuttal of Mr.juctice Rehnquist

Mr.juctice Rehnquist: The taxing power is certainly can seek, conferred in very, very broad authority to power or lay and collect taxes without any textual limitations as I recall.

Rebuttal of Lafontant

Ms Lafontant: But the case law has restricted the taxing power in much more so than the commerce power.

The commerce power is much broader.

Unknown Speaker: Of course this is the implication of my question as to whether there isn't a limitation even on the commerce power.

As I think you have more or less conceded, there must be some although --

Ms Lafontant: Yes but we don't know where it stops so all we can is that we know that this isn't the case that would stop it.

And the cases have said that there is a limitation on the commerce power but we haven't reached that limitation I believe in this case.

Unknown Speaker: What limitation if it's not commerce?

Ms Lafontant: Well that's pretty broad.

What is commerce?

Because so many -- is there anything other than the collecting of your garbage is not commerce.

Unknown Speaker: An interstate commerce?

Ms Lafontant: Right.

Right.

Chief Justice Warren E. Burger: Or there can be little doubt that the total amount of the wages paid to the state and local employees in this country has an enormous impact on the commerce of the United States, can they?

Ms Lafontant: Oh!

No doubt, yes.

Chief Justice Warren E. Burger: Suppose since we've gone quite far a field.

Ms Lafontant: [Laughter]

Chief Justice Warren E. Burger: Suppose the state hypothetically decided to pay the members of its legislature $100,000.00 a year, and that same legislature was asking the Congress of the United States to appropriate money for large grants to the state for highways or garaging or whatnot.

Do you think there are much doubt about the power of the United States to say that the States who are going to pay $100,000.00 a year to their legislatures aren't going to get the same treatment on federal grants in aid as states who are more [Voice Overlap]?

Ms Lafontant: I don't think there's any doubt about that.

No doubt about it at all.

This thing is still worrying me as the case I wanted to find which I can't find right now on the point of Mr. Justice Stewart's question.

In fact, it's Mr. Justice Stewart's dissent in Perez versus United States.

Unknown Speaker: No, that's -- that was --

Ms Lafontant: No, that was -- that one was the on it had to do with the loan sharking.

I'm sorry.

Unknown Speaker: That's right.

Ms Lafontant: Right.

But they are --

Unknown Speaker: Dissents are subversive literature anyway.[Laughter]

Ms Lafontant: As my opponent said in his reply brief that it was obvious that we had not read the dissent in Maryland versus Wirtz because we had now quoted from it but he did extensively.

Rebuttal of Mr.juctice Rehnquist

Mr.juctice Rehnquist: Well Ms. Lafontant, if what we had here were employees of private employers doing exactly the work and potentially receiving exactly the amount of wages as these employees.

I take it that Commerce Clause extent of Congress' part just measured by the commerce power be exactly the same whether they were private employers or state employers.

Rebuttal of Lafontant

Ms Lafontant: True.

Rebuttal of Mr.juctice Rehnquist

Mr.juctice Rehnquist: The rub comes from the fact that it may be that Congress can't exert the commerce power to the same extent against States as it can against private employers.

Rebuttal of Lafontant

Ms Lafontant: Well there's no doubt about it, yes because of the Tenth Amendment.

Chief Justice Warren E. Burger: But you don't think you have to get into that region for the case?

Ms Lafontant: No, I hope not.

I think.

Unknown Speaker: But isn't that what's this case is all about?

Ms Lafontant: Well, let's say -- no, this is not what ought this case is all about.

It could be if you reject the argument that there is no other way out for the petitioners.

My main point is that you do not even have to get to constitutionality of this Act and the Tenth Amendment because of a pending injunction which I believe a motion should be made to dissolve it because the law has expired.

But once we get into the constitutionality of the Act, the Tenth Amendment certainly is part and parcel of that whole thing.

But I don't see how even in the Tenth Amendment how the state can really -- Ohio can really argue that it's sovereign powers are being impinged upon or that it's being forced to cut back on certain services or they have to operate a certain way just because the salaries have been cut.

If we look at where Maryland versus Wirtz, there, the state had to pay out money, additional money to reach the minimum wage.

In this case, the wages are cut back.

The only thing that you can really say that the state might be suffering in which they alleged, that they're suffering, they say that there's a disparity between state employees salaries and private employees salaries.

The Economic Stabilization Act is saying we're treating you both the same, so the level of attractiveness for employees remains the same.

They're not being discriminated against and both private and the state employees are treated the same.

So the only argument that I would think they would have is if would be the argument that they couldn't attract employees or couldn't keep their employees.

But I don't think that that can stand out.

Chief Justice Warren E. Burger: Thank you very much.

Do you have anything further Mr. Brown?

Rebuttal of John A. Brown

Mr. John A. Brown: Yes.

You know, we have argued this matter now several times.

I think this is the first time I've heard anyone from United States agree that there's limit on the commerce power that's comforting me here.

Because we certainly agree with counsel for the appellee, that unless there's a limit on the commerce power then we must all remove the Tenth Amendment and simply does not mean when it said.

Now, Judge Mosk of the California Supreme Court in the Cohen versus California case said, “perhaps a trend toward centralized authority and judicial acquiescence in it are irreversible.

Nevertheless, I suggest that a fait accompli is not necessarily desirable or constitutionally permissible.

We agree with Justice Mosk and there was a great deal of dialogue between the court and me, and the court and my delightful counterpart in asking whether or not Congress had something and I don't think the question is whether they had but whether they may because the question that is before in this Court as indicated by Mr. Justice Marshall's question.

Is that a year from now, it may very well again come that federal wage in branch controls may again be sought, and again we will have a question of our salaries of employees of New York, Ohio, California, to be limited again as they purported to be in this last confrontation we had.

We believe that you cannot say to the State of Ohio under the Tenth Amendment that your budget for 1975 may be no more than 5% more than your budget from 1974.

And you may not say that salaries for state employees are required to be the same in 1975 as they were in 1974, or that you may not say that salaries for employees in 1975 must be 10% less than they were in 1974, because if you say that they can do one thing, you must say that they would do the other thing.

Chief Justice Warren E. Burger: Do we not now on the presence under Davis-Bacon in effect to say to the States indirectly at least that you must pay the prevailing wage on any contracts, in which there's a contribution by the federal government?

Mr. John A. Brown: Yes but again that's an -- that's a different matter than saying that the State of Ohio that you cannot pay tax collectors, judges, officials that have no counterpart in private industry at all.

Now, Maryland against Wirtz made the point and made it very well, that there was a matter in competition with private industry.

David-Bacon deals primarily with private industry or at least jobs comparable to private industry.

We're not -- we're much further than that in this case.

Here, we're talking about 100% of the job for the state I would withdraw and you may arrest me going home because I'm trying to do best.

He wouldn't be limited as would be a handyman in the school.

And that's much, much broader than words was.

Unknown Speaker: Does this apply to elective public employees in Ohio as well, to Governor Gilligan himself for example?

Mr. John A. Brown: The Governor's salary is regulated by Constitution in Ohio.

Unknown Speaker: And it was not covered by this wage increase, was it?

Mr. John A. Brown: True.

Unknown Speaker: Now hadn't -- judicial salary is the same, isn't it?

Mr. John A. Brown: True.

Unknown Speaker: They're separately covered.

Mr. John A. Brown: True.

Unknown Speaker: Legislative salary is the same.

Mr. John A. Brown: In a while, yes.

Now, that may or may not two another states.

Unknown Speaker: But in this case --

Mr. John A. Brown: In Ohio, it is.

Unknown Speaker: -- elective officials were not covered by this pay increase?

Mr. John A. Brown: True.

Unknown Speaker: Is that correct?

Mr. John A. Brown: Thank you very much.

Chief Justice Warren E. Burger: Thank you Mr. Brown.

Thank you Mrs. Lafontant.

The case is submitted.