Evening star., 1935-12-19


LEASING transmission lines to nlu-
inequalities is unconstitutional.
BY the Associated Press.
Validity of the Tennessee Valley act
was challenged today before the Su-
preme Court by Forney Johnston, Biz
mlngham attorney, on the ground
it put the Federal Government in
the power business in violation OF the
Constitution.
He was the first speaker for a
group of IA minority stockholders OF
the Alabama Power Co., who are seek
ing to prevent the Tennessee Valley
Authority from proceeding with its
project to establish a 'yardstick" to
measure the proper cost OF electricity.
The stockholders won in the Fed
eral District Court for Northern Ala
bama, but lost in the Circuit Court
of Appeals at New Orleans. The latter
court held the T. v. A. act was con-
stitutlonal.
Defenders Are Ready.
oOllClGOI
John Lord O'Brian, the former Re
publican Assistant Attorney General,
were ready to defnd the legislation.
James M. Beck, former solicitor gen.
eral. representing the stockholders, will
close the arguments.
Meanwhile, Vermont attacked the
Federal power program as an invasion
Of State rights.
Attorney General Lawrence c. Jones,
in a brief, said his State docs not
care to delegate the regulation OF util-
ity rates and service (from the Pas
samaquoddy projecD to the Federal
Government"
Contends for Limitation.
The Vermont official contended Fed
eral projects such as T. V. A. and
"Quoddy'' should be limited to actual
Improvements of navigation"
T. v. A. claimed exclusive Federal
rights. he argued, "to utilize surplus
waters for the direct commercial man
ufacture and sale of electricity by the
Government without the con-
sent of the State, without revenue to
the State and without regulation by
the State ="
Those in the court room included
David Lilienthal and DR.. H. A. Morgan
of the Tennessee Valley Authority and
Representative Rankin of Mississippi,
q hacker of the T. v. A.
A number of seats were unoccupied.
Five-HOur Argument.
Five hours were set aside for argu-
ments. In its decision, likely in jan
uary, the court will decide whether
the Government can sell surplus elec-
tric power to municipalities in COM
petition with private utility COM
panies.
The litigation resulted from con-
tract under which the Alabama Power
Co. agreed to sell T. v. A. transmits
sion lines from Wilson Dam, at
Muscle Shoals, to seven Alabama
counties. An interchange of electric
power and division of territory also
were arranged.
Fourteen minority stockholders OF
the power company sued to enjoin
performance of the contract. They
won in the Federal District Court for
Northern Alabama, but lost in the
Circuit Court of Appeals at New Or
leans.
The Tennessee Valley project has
been one Of President Roosevelt's IA
vorite activities. He told Of mis- plans
q month before he entered the White
House. One purpose, he indicated,
was to establish a "yardstick" for
measuring the proper cost Of power.
Debate to End for Time.
The T. " A. arguments will con-
clude Supreme Court debate on New
Deal litigation until January or Feb
ruary.
The last few weeks have been busy
times for court and lawyers and some
of the latter have been under heavy
strain.
At his latest active appearance be-
fore the court, on December IL, Solici-
tor General Reed collapsed while ar
euing for the Bankhead cotton pro-
duction control act. Another attorney
Frederick B Campbell Of New
York-fainted yesterday while argu-
ing case.