Landmark Supreme Court Case: U.S. v. Darby Lumber (1941)

U.S. v. Darby Lumber (1941) is the 79th landmark Supreme Court cases, the 33rd in the Economics module, featured in the KTB Prep American Government and Civics Series designed to acquaint users with the origins, concepts, organizations, and policies of the United States government and political system. The goal is greater familiarization with the rights and obligations of citizenship at the local, state, national, and global levels and the history of our nation as a democracy. While there is overlap, these landmark cases are separated into cases addressing:

• Courts
• Foreign Policy
• Family
• Science & Technology
• Environment
• Public Safety
• Religion
• Death Penalty
• Healthcare
• Speech, Press, and Protest
• Elections
• Economics
• Criminal Justice
• Education
• Politics, Society, Freedom, and Equality

The Supreme Court

The Supreme Court is the highest court in the United States. Article III of the U.S. Constitution created the Supreme Court and authorized Congress to pass laws establishing a system of lower courts. The Constitution elaborated neither the exact powers and prerogatives of the Supreme Court nor the organization of the Judicial Branch as a whole. Thus, it has been left to Congress and to the Justices of the Court through their decisions to develop the Federal Judiciary and a body of Federal law.

The number of Justices on the Supreme Court changed six times before settling at the present total of nine in 1869. Since the formation of the Court in 1790, there have been only 17 Chief Justices* and 102 Associate Justices, with Justices serving for an average of 16 years. On average a new Justice joins the Court almost every two years.

The Supreme Court of the United States hears about 100 to 150 appeals of the more than 7,000 cases it is asked to review every year. That means the decisions made by the 12 Circuit Courts of Appeals across the country and the Federal Circuit Court are the last word in thousands of cases.

Court of Appeals

In the federal court system’s present form, 94 district level trial courts and 13 courts of appeals sit below the Supreme Court. The 94 federal judicial districts are organized into 12 regional circuits, each of which has a court of appeals. The appellate court’s task is to determine whether or not the law was applied correctly in the trial court. Appeals courts consist of three judges and do not use a jury.

The appellate courts do not retry cases or hear new evidence. They do not hear witnesses testify. There is no jury. Appellate courts review the procedures and the decisions in the trial court to make sure that the proceedings were fair and that the proper law was applied correctly.

A court of appeals hears challenges to district court decisions from courts located within its circuit, as well as appeals from decisions of federal administrative agencies. In addition, the Court of Appeals for the Federal Circuit has nationwide jurisdiction to hear appeals in specialized cases, such as those involving patent laws, and cases decided by the U.S. Court of International Trade and the U.S. Court of Federal Claims.

District Courts

The nation’s 94 trial courts are called U.S. District Courts. At a trial in a U.S. District Court, witnesses give testimony and a judge or jury decides who is guilty or not guilty — or who is liable or not liable. District courts resolve disputes by determining the facts and applying legal principles to decide who is right.

Trial courts include the district judge who tries the case and a jury that decides the case. Magistrate judges assist district judges in preparing cases for trial. They may also conduct trials in misdemeanor cases.

There is at least one district court in each state, and the District of Columbia. Each district includes a U.S. bankruptcy court as a unit of the district court.

Bankruptcy Courts

Federal courts have exclusive jurisdiction over bankruptcy cases involving personal, business, or farm bankruptcy. This means a bankruptcy case cannot be filed in state court. Bankruptcy Appellate Panels (BAPs) are 3-judge panels authorized to hear appeals of bankruptcy court decisions. These panels are a unit of the federal courts of appeals, and must be established by that circuit. Five circuits have established panels: First Circuit, Sixth Circuit, Eighth Circuit, Ninth Circuit, and Tenth Circuit.

U.S. v. Darby Lumber (1941)

Darby Facts:

Darby Lumber, located in Statesboro, Georgia, was founded by entrepreneur Fred Darby in 1919 after the conclusion of World War I. After buying some land from a defunct oil company, Mr. Darby turned his lumber company into one of the premier companies in the area with over 50 employees. The company benefited from the forested land of South Georgia and easy railroad access to nearby Savannah and not too distant Macon.

During the boom of the 1920s, and even the bust of the 1930s, Darby Lumber prospered so well that in 1938 it was able to expand its operations. The expansion, which included larger facilities and an increased payroll, garnered resources that would make the operations of the company much more efficient.

In 1938, Congress passed the Fair Labor Standards Act (FLSA) to regulate many aspects of employment, including minimum wages, maximum weekly hours, and child labor. It was one of many initiatives enacted by President Franklin Roosevelt during the Great Depression and, to date, the most comprehensive to dictate the running of corporations. Roosevelt wanted to unite labor practices in all then 48 states then existing, as he considered that leaving that power to the states to be ineffective.

There was some concern on how the new law would affect the viability of businesses. Passed in August 1938 and signed into law by Roosevelt two months later, the Commerce Clause addressed businesses that conducted both intrastate and interstate commerce.

The law established a federal minimum wage, the 44-hour work week standard, the latter being the slightly-longer precedent for the current 40-hour standard. Also established by the law was overtime pay, which remains in effect to require employers to pay their hourly-employees at least 150% of their normal wages for work in excess of the standard.

Darby, shipped lumber out of state and was arrested for violating the FLSA. The company successfully appealed when an appellate judge ruled that the federal government is barred by the Tenth Amendment from interfering in matters that are strictly local and within state boundaries. The potential effects on intrastate activities violated the Commerce Clause.

Darby Legal Questions and Answers

Q: Was the Act a legitimate exercise of Congress’s power to regulate interstate commerce?

A: Yes. The Court upheld upheld the constitutionality of the Fair Labor Standards Act of 1938 under the Commerce Clause; Congress has the power to regulate manufacturing.

Darby Conclusion

Unanimous holding the Fair Labor Standards Act was a constitutional exercise of Congressional power under the Commerce Clause. Congress had the power to regulate employment conditions.

Relying heavily on the decision of Gibbons v. Ogden (1824), the Court affirmed the constitutional power of Congress to regulate interstate commerce, which “can neither be enlarged nor diminished by the exercise or non-exercise of state power.” The purpose of the FLSA was to prevent states from using substandard labor practices to their own economic advantage by interstate commerce. Congress acted with proper authority in outlawing substandard labor conditions since they have a significant impact on interstate commerce.

The unanimous decision of the Court in this case overturned Hammer v. Dagenhart (1918), limited the application of Carter v. Carter Coal Company (1936), and confirmed the underlying legality of minimum wages held in West Coast Hotel Co. v. Parrish (1937).

Next Economics Case: Wickard v. Filburn (1942)

Previous Economics Case: U.S. v. Carolene Products (1938)

Previous Case: Minersville School District v. Gobitis (1940)

Comments

comments