considered as a parity adjustment, is 'unreasonable, excessive or otherwise improper,' and that the maximum prices should be 22- 1/2 cents per quart retail and 20- 1/2 cents per quart wholesale. Likewise, O.P.S. had the power under its successor regulation SR 63 to fix maximum prices by definitive order, which, after notice to the processors, would be binding upon them. It is the court's opinion under all the circumstances of this case that, after proper investigation, a definitive order by O.P.S. would be appropriate.
The fact that the Commission's Order A-415 happened to raise the price of milk in the exact amount permitted by the court's interpretation of the O.P.S. regulations is in no way to be construed as an approval of the Commission's Order. The rationale justifying the last increase of 1 cent per quart is not the Commission's Order but the court's interpretation. Let there be no misunderstanding that if this court were to find a violation of the ceiling prices as established or proclaimed by O.P.S. it would be promptly enjoined, notwithstanding the minimum price provisions of the Commission.
Case v. Bowles, 1946, 327 U.S. 92, 66 S. Ct. 438, 90 L. Ed. 552; Bowles v. Bergman,
et al., D.C.N.D.N.Y. 1944, Civil Action No. 1546. See also Hecht Co. v. Bowles, 1944, 321 U.S. 321, 331, 64 S. Ct. 587, 88 L. Ed. 754.
Conclusions of Law
1. Jurisdiction of this action is conferred upon this court by Sections 409(a) and 706(b) of the Defense Production Act of 1950, Act of Sept. 8, 1950, c. 932, 64 Stat. 811(a), 817(b); 50 U.S.C.A.Appendix, §§ 2109(a) and 2156(b), as amended by Defense Production Act Amendments of 1951, c. 275, Public Law 96, 82nd Cong., 1st Sess.
2. During the base period fixed by the G.C.P.R. selling prices for milk in the Pittsburgh Area were 21 cents per quart retail and 19 cents per quart wholesale, which prices became the base period ceiling prices for the defendant processors, and their maximum prices during the period from January 26, 1951 to April 6, 1951.
3. Following the adjustment of the ceiling prices granted by O.P.S. effective April 6, 1951, the defendant processors' maximum prices became 22 cents per quart retail and 20 cents per quart wholesale. This adjustment was not a parity adjustment under the G.C.P.R., Section 11, but was an adjustment of the ceiling prices under SR 16 (16 F.R. 3011)
granted by O.P.S. by Order No. L-1. No process of rounding of fractions was used in determining this adjustment of ceiling prices.
4. Since the Commission, by General Order No. A-415 effective July 17, 1951, had advanced the producers' price from $ 5.70 per cwt. to $ 6.05 per cwt., and since said increased price was below parity, it was lawful for defendant processors, under the G.C.P.R., Section 11(b)(2) and by employing the process of rounding of fractions under SR 20 (16 F.R. 3436), to increase their maximum prices 1 cent per quart as parity adjustments and to sell milk at 23 cents per quart retail and 21 cents per quart wholesale.
5. Interpretations of regulations should not be adopted which would deprive defendant processors of the 'processors' spread' of 11- 1/2 cents per cwt. (.247 plus of a cent per quart) which spread, upon consideration of various factors prescribed by SR 16, was deliberately granted to them by O.P.S. by Order No. L-1 issued April 6, 1951, and which Order is presently in full force and effect.
6. The Defense Production Act of 1950 and the orders and regulations of the O.P.S. issued thereunder are paramount to the Pennsylvania Milk Control Law and the orders and regulations of the Commission. The letter of the Director of O.P.S. under date of July 23, 1951, was, under SR 16, a lawful denial of the petition of the Commission for increased ceiling prices for fluid milk and milk products, and any of the minimum prices fixed by the Commission in its General Order A-415, except producers' prices, which are in excess of the maximum ceiling prices established pursuant to the orders and regulations of O.P.S. would be suspended and should be enjoined.
7. The plaintiff has not proved that the defendant processors are selling milk or milk products in excess of the maximum price regulations established by O.P.S.
8. The complaint should be dismissed.