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CAPITOL COAL SALES v. MITCHELL

July 15, 1958

CAPITOL COAL SALES, Capitol Coal Sales, Inc., and Raymond Asbury, Maurice Asbury and Lee Asbury, doing business as Asbury Coal Company, Plaintiffs,
v.
James P. MITCHELL, Secretary of Labor, and Joseph Campbell, Comptroller General et al., Defendants



The opinion of the court was delivered by: MORRIS

This action, for a declaratory judgment and injunctive relief, was brought by the plaintiff Capitol Coal Sales in the United States District Court for the Eastern District of Tennessee, and transferred by that Court, upon the motion of said plaintiff for a change of venue, to this Court pursuant to 28 U.S.C. Sec. 1406(a).

Pursuant to motion of plaintiff, memorandum of points and authorities, affidavit, exhibit, and argument of counsel in open court, wherein the following appeared to the Court:

 'That the original plaintiff is a proprietorship engaged in the business of contracting to supply coal to agencies of the United States Government;

 'That defendants and their agents had given notice that plaintiff had been found, in proceedings before the Department of Labor, identified as PC-639, to have breached the requirements of labor standards of the Walsh-Healey Public Contracts Act:

 'That pursuant to the provisions of Section 3 of said Act, defendant Secretary of Labor had notified defendant Comptroller General to include plaintiff's name, and the names of firms and corporations in which plaintiff has a controlling interest, on the list of those ineligible to contract with agencies of the United States Government for three years;

 'That the defendant Secretary of Labor had determined that the Act applies on the basis that several separate contracts, each less than $ 10,000, entered into between plaintiff and the Atomic Energy Commission following a single invitation to bid, may be considered together to determine whether more than $ 10,000, the jurisdictional minimum amount required to bring into effect the provisions of said Act;

 'That plaintiff had instituted the captioned proceeding for declaratory judgment, raising, inter alia, the question whether defendant may group several contracts entered into in response to a single invitation to bid for the purpose of reaching the statutory jurisdictional amount under Section 1 of said Act, and that such action was not at issue on the merits because defendant had been granted thirty days within which to file an amended motion to dismiss.'

 The matter is before the Court on the motion of plaintiffs for temporary injunction, and on the amended motion of the defendants to dismiss, the temporary restraining order being extended by agreement of all parties until July 16, 1958.

 At the threshold, the question to be decided is whether the plaintiffs have standing to sue. It is insisted by the Government that they do not under the authority of Perkins v. Lukens Steel Co., 310 U.S. 113, 60 S. Ct. 869, 84 L. Ed. 1108, which they urge makes it mandatory to dismiss the suit. There the Secretary of Labor had fixed, subsequent to a hearing pursuant to notice, at which the plaintiffs and many other iron and steel companies were represented, the necessary minimum wage for work on government contracts on the basis of wages prevailing over a broad region, which the plaintiffs urged was an erroneous definition of the word 'locality' in the Act. The suit was by corporations customarily selling such goods to the Government, which paid lesser minimum wages than determined by the Secretary of Labor, and which asserted they would suffer irreparable injury from loss of Government business or from the necessity of increasing the wages paid by them. The Court said, 310 U.S. at page 125, 60 S. Ct. at page 875:

 'We are of opinion that no legal rights of respondents were shown to have been invaded or threatened in the complaint upon which the injunction of the Court of Appeals was based. It is by now clear that neither damage nor loss of income in consequence of the action of Government, which is not an invasion of recognized legal rights, * * * in the absence of constitutional legislation recognizing it as such. It is not enough that the Secretary of Labor is charged with an erroneous interpretation of the term 'locality' as an element in her wage determination. Nor can respondents vindicate any general interest which the public may have in the construction of the Act by the Secretary and which must be left to the political process. Respondents, to have standing in court, must show an injury or threat to a particular right of their own, as distinguished from the public's interest in the administration of the law.'

 and at page 127 of 310 U.S., at page 876 of 60 S. Ct.:

 'Like private individuals and businesses the Government enjoys the unrestricted power to produce its own supplies, to determine those with whom it will deal, and to fix the terms and conditions upon which it will make needed purchases. Acting through its agents as it must of necessity, the Government may for the purpose of keeping its own house in order lay down guide posts by which its agents are to proceed in the procurement of supplies, and which create duties to the Government alone. It has done so in the Public Contracts Act. That Act does not depart from but instead embodies the traditional principle of leaving purchases necessary to the operation of our Government to administration by the executive branch of Government, with adequate range of discretion free from vexatious and dilatory restraints at the suits of prospective or potential sellers. It was not intended to be a bestowal of litigable rights upon those desirous of selling to the Government; it is a self-imposed restraint for violation of which the Government -- but not private litigants -- can complain.

 'Our decision that the complaining companies lack standing to sue does not rest upon a mere formality. We rest it upon reasons deeply rooted in the constitutional divisions of authority in our system of Government and the impropriety of judicial interpretations of law at the ...


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