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Aerated Products Co. v. Department of Health of New Jersey


decided: February 14, 1947.


Author: O'connell


O'CONNELL, Circuit Judge.

The Aerated Products Company of Philadelphia, Pennsylvania (hereinafter called "plaintiff"), a Pennsylvania corporation, operates in Philadelphia a plant which manufactures a patented product called Instantwhip.*fn1 Packed in a small metal container, Instantwhip is used widely, throughout the United States, as a topping for sundaes, desserts, and the like.

Among plaintiff's customers was the Aerated Products Company of Newark (hereinafter called "Newark-Aerated"), an independent corporation which purchased plaintiff's product and resold it in smaller quantities to restaurants and soda fountains in New Jersey, from August, 1940, until April 1941.

Several local New Jersey boards of health, early in 1941, raised the question whether Instantwhip could be dispensed in their areas without meeting the requirements of Title 24, Chapter 10, of the Revised Statutes of New Jersey of 1937, N.J.S.A.*fn2 Plaintiff thereupon made application for a permit. Representatives of defendant Department of Health of the State of New Jersey (hereinafter called "Department") inspected plaintiff's plant, as a result of which it was ascertained that a certain dairy from which plaintiff received milk and cream had not been approved by the Department.*fn3 Consequently, on April 9, 1941, defendant J. Lynn Mahaffey (hereinafter called "Mahaffey"), Director of Health of the State of New Jersey, wrote plaintiff a letter in which he rejected plaintiff's application for a permit to distribute under the statute.*fn4 Six days later, Mahaffey, in a letter to Newark-Aerated, withheld approval of its application for a permit for the same reason, and added the following remark: "* * * furthermore, you are advised to immediately discontinue the distribution of milk products in this State, which said products are obtained from or prepared for distribution in any milk plant or creamery which fails to meet the requirements of the statute aforementioned."

Conversations between plaintiff and a representative of the Department, both before and after the letters quoted above, revealed that plaintiff would be granted a permit only if all the milk and cream used in plaintiff's plant came from sources approved by the Department.*fn5 Plaintiff thereupon brought this suit, seeking an injunction to prevent the Department and Mahaffey from interfering with the sale of Instantwhip in New Jersey and from enforcing the statute, which was alleged to be in violation of the Constitution of the United States.

At the conclusion of the testimony in the court below, the district judge granted a motion to dismiss as to the Department, on the ground that the Department is the State, which the Eleventh Amendment renders immune to suit; and entered judgment for Mahaffey on the merits, finding that he had neither taken nor threatened action giving plaintiff a cause for complaint. The court took the view that the permit negotiations between plaintiff and the representatives of Mahaffey were of no legal effect, because "the statute specifically limits its operation to the production, distribution and sale of milk, cream and milk products within the State of New Jersey," and "the provisions of this statute do not apply to nonresidents of New Jersey." D.C.1945, 59 F.Supp. 652, 657.*fn6

The Eleventh Amendment of the Federal Constitution denies to federal courts the jurisdiction over suits against a State by citizens of another State. The Department is a part of the executive branch of the New Jersey government. Revised Statutes of New Jersey of 1937, 26:2-1 et seq., N.J.S.A.; Board of Health v. Mundet Cork, Corporation, 1939, 126 N.J.Eq. 100, 8 A.2d 105, affirmed 1940, 127 N.J.Eq. 61, 11 A.2d 260. Consequently, we agree with the court below that plaintiff's suit against the Department is prohibited by the Eleventh Amendment. Ford Co. v. Department of Treasury, 1945, 323 U.S. 459, 65 S. Ct. 347, 89 L. Ed. 389.

As to Mahaffey, the rule is equally clear that his function as a public official brings him within the protection of the Eleventh Amendment only if the statutes authorizing his actions are constitutional, and if his actions do not exceed the authority granted him. Baldwin v. G.A.F. Seeing, 1935, 294 U.S. 511, 55 S. Ct. 497, 79 L. Ed. 1032, 101 A.L.R. 55. If the activities of Mahaffey are in violation of a right guaranteed by the federal Constitution, this court has jurisdiction to enjoin such violation.

Plaintiff's appeal, therefore, raises two questions which we have jurisdiction to decide: (1) Does New Jersey have the power to limit the distribution and sale in New Jersey of Instantwhip manufactured in Pennsylvania? (2) Is plaintiff entitled to an injunction preventing Mahaffey from interfering with shipments of Instantwhip into New Jersey?

As to the first question: The testimony reveals that all distributing and selling of Instantwhip in New Jersey is performed by Newark-Aerated. Newark-Aerated is not acting as an agent of plaintiff, and is not a party to this suit. Adjudication of this issue, therefore, would affect the rights of Newark-Aerated without giving it the opportunity to be heard. See Mallow v. Hinde, 1827, 25 U.S. 193, 198, 12 Wheat. 193, 198, 6 L. Ed. 599; quoted in Buss v. Prudential Ins. Co. of America, 8 Cir. 1942, 126 F.2d 960, 967. Consequently, we are not called upon to decide, and do not decide, what effect the statute and the activities of Mahaffey would have upon the rights of Newark-Aerated.

As to the second question: Our examination of the record in this case indicates that the district court did not abuse its discretion in finding that no action had been taken of threatened by Mahaffey which would jeopardize plaintiff's right to ship. Indeed, defendant concedes the right, and points out further that that right was exercised without hindrance for nine months, while the statute was in effect.*fn7

At best, therefore, it would appear that an injunction is sought prematurely by plaintiff. "It is elementary that a court of equity will not grant an injunction to restrain one from doing what he is not attempting and does not intend to do." Blease v. Safety Transit Co., 4 Cir., 1931, 50 F.2d 852. 856.


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