A statute of Virginia, known as the 'Milk and Cream Act,' is assailed by the appellants as invalid both under the Constitution of Virginia and under that of the United States.
The act is chapter 357 of the Acts of 1934. It recites the existence of demoralizing trade practices in the dairy industry, threatening to interrupt the supply of pure and wholesome milk for the inhabitants of the Commonwealth and producing an economic emergency so acute and destructive as to call for corrective measures. It establishes a milk commission with power to crete within the state natural market areas, and to fix the minimum and maximum prices to be charged for milk and cream therein. It authorizes the commission to exact a license from distributors subject to the act, and provides that in the absence of such a license sales shall be unlawful within the market areas. It imposes taxes or fees for the support of the commission and of local milk boards which are to be created to co-operate with the commission in making the plan effective. It warns (section 14) that none of its provisions 'shall apply or be construed to apply to foreign or interstate commerce, except in so far as the same may be effective pursuant to the United States Constitution and to the laws of the United States enacted pursuant thereto.' Finally it provides (section 16) that, 'if any section, clause, or sentence or paragraph shall be declared unconstitutional for any reason, the remainder of the act shall not be affected thereby.' A fuller summary of the statute is given in the opinion of the court below ((D.C.) 16 F.Supp. 575), to which reference is made. Other provisions will be noted in this opinion later.
The suit is for an injunction to restrain the members of the commission from enforcing the statute or the regulations made thereunder. One of the two plaintiffs (Highland Farms Dairy, Incorporated), which will be spoken of as 'Highland,' has a creamery for the pasteurizing and treatment of milk at Washington in the District of Columbia. For that purpose it buys milk from farmers in Virginia and Maryland. Its entire output of bottled milk it sells to the other plaintiff, Luther W. High, who has retail stores in Virginia and elsewhere for the sale of ice cream, milk and other dairy products. A regulation adopted by the commission on March 27, 1936, set up a market area, described as the Arlington-Alexandria Milk Market, within which High is engaged in business. Minimum prices prescribed for that area are in excess of the prices at which Highland had been selling to High and at which High had sold to the consumers. Each went on selling at the old prices. Neither made application for a license. In June, 1936, the commission gave notice to High that it would proceed against him for an injunction if he refused compliance with its orders. No proceedings against Highland were begun or even threatened, the commission taking the position that Highland was not subject to the prohibitions of the statute, its sales and purchases in Virginia being transactions in interstate commerce. In spite of this disclaimer, Highland joined with High in suing to enjoin the enforcement of the act. A District Court of three judges, organized in accordance with section 266 of the Judicial Code (28 U.S.C. § 380 (28 U.S.C.A. § 380)), gave judgment for the defendants, with a comprehensive opinion to which little can be added. 16 F.Supp. 575. The case is here upon appeal. 28 U.S.C. § 380 (28 U.S.C.A. § 380).
The power of a state to fix a minimum price for milk in order to save producers, and with them the consuming public, from price cutting so destructive as to endanger the supply, was affirmed by this Court in Nebbia v. New York, 291 U.S. 502, 54 S.Ct. 505, 78 L.Ed. 940, 89 A.L.R. 1469, and in other cases afterwards. Hegeman Farms Corp. v. Baldwin, 293 U.S. 163, 55 S.Ct. 7, 79 L.Ed. 259; Borden's Farm Products Co. v. Ten Eyck, 297 U.S. 251, 56 S.Ct. 453, 80 L.Ed. 669. Appellants are not asking us to undo what was there done. They take the ground, however, that the statute of Virginia is open to objections that were inapplicable to the statute of New York. The present grounds of criticism will be considered one by one.
1. The statute is not invalid as an unlawful delegation of legislative power.