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FREEMAN v. USDA

October 27, 1972

Huey Freeman et al., Plaintiffs
v.
United States Department of Agriculture et al., Defendants


Pratt, D. J.


The opinion of the court was delivered by: PRATT

Upon consideration of plaintiffs' motion for preliminary injunction, their memorandum of points and authorities and related attachments in support thereof, defendants' memorandum of points and authorities and related exhibits and affidavits in opposition thereto, and oral argument of counsel, the Court enters the following Findings of Fact and Conclusions of Law.

 Findings of Fact

 1. This is a class action instituted pursuant to Rule 23, Federal Rules of Civil Procedure, by representatives of Louisiana sugarcane workers (hereafter "the plaintiffs") against the United States Department of Agriculture and various officials of that Department (hereafter "the defendants") who are responsible for administering the Sugar Act of 1948, 7 U.S.C. §§ 1100 et seq. (1970), as amended (Supp. I, 1971).

 2. Plaintiffs instituted this action to obtain judicial review of the statement of fair and reasonable wage rates for Louisiana sugarcane workers which defendants published on December 28, 1971 (see 36 Fed. Reg. 24983 (Dec. 28, 1971)) (hereafter "the 1971 Louisiana wage determination"). Plaintiffs seek declaratory, injunctive, and monetary relief concerning the interpretation and application of the Sugar Act, the regulations promulgated in implementation thereof (7 C.F.R., Parts 802 and 864, as amended), the Economic Stabilization Act, 84 Stat. 799 (1970), as amended, Pub. L. No. 92-210, 85 Stat. 744 (Dec. 22, 1971) and the regulations promulgated in implementation thereof (6 C.F.R., Parts 101 and 201, as amended).

 3. The Sugar Act empowers the defendants to make annual subsidy payments to producers of sugarcane in Louisiana and other producing areas. Section 301(c)(1) of the Sugar Act, 7 U.S.C. § 1131(c)(1) (1970), expressly conditions defendants' authority to pay a subsidy upon a producer's payment in full to all workers whom he employed in the planting, cultivation, or harvesting of his sugarcane crop of wage rates not less than the rates which the defendants shall declare to be fair and reasonable pursuant to established statutory and regulatory guidelines.

 4. To assist the defendants in determining fair and reasonable wage rates for each producing area, section 301(c)(1) of the Sugar Act directs that defendants consider the four substantive standards formerly employed under the Agricultural Adjustment Act. These standards, as agreed upon by plaintiffs and defendants, are the cost of living, the current prices for sugar and its by-products, anticipated income from the production of sugarcane, and the cost of production.

 5. To assist in the determination of fair and reasonable wage rates and to establish formal procedures to control the formulation and issuance of such determinations defendants have adopted regulations which appear at 7 C.F.R., Part 802. These regulations have existed in virtually unaltered form since 1948 and have not been amended during the period relevant to this action. The regulations require in part that defendants, after appropriate notice, annually convene one or more hearings for the receipt of evidence to assist them in determining fair and reasonable wage rates (7 C.F.R. § 802.2); that all interested persons be given a reasonable opportunity to offer relevant evidence at the hearing (id. § 802.5(d)); that defendants (or their delegate) promptly prepare a proposed determination including a statement of the bases and considerations upon which that proposal is based (id. § 802.6(a)-(b)); that this proposed determination be submitted to the Secretary of Agriculture immediately for approval and issuance (id. § 802.6(b)); and that the Secretary publish the full text of his final determination in the Federal Register (id. § 802.6(c)).

 6. In administering the Sugar Act during the past twenty-two years defendants generally convened a hearing in Louisiana (pursuant to 7 C.F.R. § 802.2) during June or July of each year for the purpose of receiving evidence to assist them in determining fair and reasonable wage rates for Louisiana sugarcane workers. The resulting wage determinations, with only three immaterial exceptions, have been issued and made effective prior to or concurrently with the beginning of the Louisiana sugarcane harvest, which extends from early October until early January. These determinations have uniformly established fair and reasonable wage rates for labor performed in the harvest of the crop for the year in which the determination is issued and for labor performed in the planting and cultivation of the following year's crop.

 7. Representatives of the defendants conducted a hearing in Houma, Louisiana, on July 9, 1971, for the purpose of receiving evidence to assist defendants in preparing the 1971 Louisiana wage determination. Defendants have submitted a copy of the transcript of that hearing as Exhibit A to their Motion to Dismiss.

 8. Pursuant to his authority under the Economic Stabilization Act the President of the United States instituted a freeze on all wage increases on August 15, 1971. See Executive Order No. 11615, § 1 (originally appearing at 36 Fed. Reg. 15727 (Aug. 17, 1971)). This freeze (Phase I) extended for ninety days until the adoption of a more flexible system of controls (Phase II) on November 14, 1971. See 36 Fed. Reg. 21790 (Nov. 13, 1971).

 10. On December 28, 1971, defendants published the 1971 Louisiana wage determination which is the subject of this action (see 36 Fed. Reg. 24983). Although this determination purported to establish new fair and reasonable wage rates for labor performed in the harvest of the 1971 Louisiana sugarcane crop and the planting and cultivation of the 1972 crop, it did not become effective until January 10, 1972. All labor performed in the harvest of the 1971 crop had been completed by the time this 1971 wage determination became effective. Plaintiffs and the workers whom they represent were, accordingly, employed throughout the 1971 harvest season at the wage rates established for the 1970 harvest season under the 1970 Louisiana wage determination (see 35 Fed. Reg. 15741 (Oct. 7, 1970)).

 11. In determining the amount of the increases in the fair and reasonable wage rates established under the 1971 Louisiana wage determination, defendants did not limit their consideration to the four substantive standards established under section 301(c)(1) of the Sugar Act (see Findings of Fact, para. 4, supra); they apparently relied, in addition, upon the general restriction on salary increases under Phase II of the Economic Stabilization Program to limit the 1971 increases to 5.5% over the rates established in the 1970 wage determination. See 36 Fed. Reg. 24983 (Dec. 28, 1971) (the 1971 Louisiana wage determination). Plaintiffs and the workers whom they ...


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