Source: https://supreme.justia.com/cases/federal/us/322/643/
Timestamp: 2019-04-19 10:25:55+00:00

Document:
1. In view of the activities of the petitioner in the conduct of its insurance business (described in the opinion), the National Labor Relation Board was justified in concluding that the practices in which the petitioner was found to be and to have been engaged were, within the meaning of the National Labor Relations Act, unfair labor practices "affecting commerce" which the Board was empowered by the Act to prevent. Pp. 322 U. S. 644, 322 U. S. 648.
2. The cultural and fraternal aspects of the petitioner's activities did not except it from the operation of the National Labor Relations Act. P. 322 U. S. 648.
3. The application of the National Labor Relations Act to the activities of the petitioner, though in the business of insurance, was a valid exercise of the power of Congress under the commerce clause of the Federal Constitution. P. 322 U. S. 649.
Certiorari, 320 U.S. 725, to review a decree granting enforcement of an order (as modified) of the National Labor Relations Board, 42 N.L.R.B. 1375.
Act, had engaged in unfair labor practices, issued an order of cessation against it. 42 N.L.R.B. 1375. On a petition for review and a cross-petition of the Board for enforcement, the Circuit Court of Appeals for the Seventh Circuit sustained the order. 136 F.2d 175. Of the numerous issues before that court, only two are open here, the importance of which led us to grant certiorari. 320 U.S. 725. The questions are these: (1) in view of the petitioner's activities, is the conduct found by the Board to constitute unfair labor practices within the scope of the National Labor Relations Act; (2) if Congress has proscribed such conduct, has it exceeded its power to regulate commerce among the several States?
The Polish National Alliance is a fraternal benefit society providing death, disability, and accident benefits to its members and their beneficiaries. Incorporated under the laws of Illinois, it is organized into 1,817 lodges scattered through twenty-seven States, the District of Columbia, and the Province of Manitoba, Canada. As the "largest fraternal organization in the world of Americans of Polish descent," it had outstanding, in 1941, 272,897 insurance benefit certificates with a face value of nearly $160,000,000. Over 76% of these certificates were held by persons living outside of Illinois. At the end of that year, petitioner's assets totaled about $30,000,000, in cash, real estate in five States, United States Government bonds, foreign government bonds, bonds of various States and their political subdivisions, railroad, public utility, and industrial bonds, and stocks. From its organization in 1880 until the end of 1940, the Alliance spent over $7,000,000 for charitable, educational, and fraternal activities among its members. During the same period, it paid out over $38,000,000 in "mortuary claims."
borne by Alliance and who receive commissions for new memberships. Since its 1939 convention, Alliance has admitted no more "social members." Thereafter, all applicants have been required to buy insurance certificates providing various types of life, endowment, and term coverage. These policies contain the typical loan, cash surrender value, optional settlement, and dividend provisions. Petitioner spent over $10,000 for advertising outside of Illinois during 1941. It employs a Georgia credit company to report on the financial standing and character of the applicants, and reinsures substandard risks with an Indiana company.
Alliance lodges are organized into 190 councils, 160 of which are outside the Illinois. The councils elect delegates to the national convention, and it, in turn, elects the executive and administrative officers. The Censor of Alliance is its ranking officer, and he appoints an editorial staff which publishes a weekly paper distributed to members. Of the 6,857,556 copies published in 1941, about 80% were mailed to persons living outside of Illinois.
"have a close, intimate, and substantial relation to trade, traffic, and commerce among the several States and tend to lead to labor disputes burdening and obstructing commerce,"
meaning of Section 2(6) and (7)," and as such, prohibited by § 10 of the Wagner Act.
supra, at 316 U. S. 522-523. Congress has explicitly regulated not merely transactions or goods in interstate commerce, but activities which, in isolation, might be deemed to be merely local, but, in the interlacings of business across state lines, adversely affect such commerce. By the Wagner Act, Congress gave the Board authority to prevent practices "tending to lead to a labor dispute burdening or obstructing commerce or the free flow of commerce." § 2(7) of the National Labor Relations Act (49 Stat. 449, 450, 29 U.S.C. § 152(7)). Congress therefore left it to the Board to ascertain whether proscribed practices would in particular situations adversely affect commerce when judged by the full reach of the constitutional power of Congress. Whether or not practices may be deemed by Congress to affect interstate commerce is not to be determined by confining judgment to the quantitative effect of the activities immediately before the Board. Appropriate for judgment is the fact that the immediate situation is representative of many others throughout the country, the total incidence of which, if left unchecked, may well become far-reaching in its harm to commerce. Labor Board v. Fainblatt, supra, at 306 U. S. 607-608.
We have said enough to indicate the ground for our conclusion that the Board was not unjustified in finding that the unfair labor practices found by it would affect commerce. And the undoubted fact that Alliance promotes, among Americans of Polish descent, interest in, and devotion to, the contributions that Poland has made to civilization does not subordinate its business activities to insignificance. Accordingly, the Board could find that its cultural and fraternal activities do not withdraw Alliance from amenability to the Wagner Act.
years, from Paul v. Virginia, 8 Wall. 168, to New York Life Ins. Co. v. Deer Lodge County, 231 U. S. 495, have invariably involved some exercise of state power resisted, in most instances, on the claim that it was impliedly forbidden by the Commerce Clause. Such was the context in which this Court decided again and again that the making of a contract of insurance is not interstate commerce, and that, since the business of insurance is, in effect, merely a congery of contracts, the States may, for taxing and diverse other purposes, regulate the making of such contracts and the insurance business free from the limitations imposed upon state action by the Commerce Clause. Constitutional questions that look alike often are altogether different, and call for different answers because they bring into play different provisions of the Constitution or different exertions of power under it. Thus, federal regulation does not preclude state taxation, and state taxation does not preclude federal regulation. Compare, for example, Heisler v. Thomas Colliery Co., 260 U. S. 245, with Sunshine Coal Co. v. Adkins, 310 U. S. 381.
We have, therefore, now presented for the first time not an exercise of state, but of national power in relation to the insurance business. And so the ultimate question is whether, in view of the relation between the activities of the insurance business before us and the operation of economic forces across state lines, the Constitution denies to Congress the power to say that the interplay of the insurance business and those economic forces is such that its power "to regulate Commerce . . . among the several States," Const. art. 1, § 8, cl. 3, carriers with it the power to regulate the conduct here regulated by relevant legislation.
the two great English-speaking federations, the constitutions of which similarly distribute legislative power over business between central and subordinate governments. See § 91 of the British North America Act, 1867, 30 & 31 Vict., c. 3, and Report of the (Canadian) Royal Commission on Dominion-Provincial Relations, (1940) Bk. II, c. IV; § 51 of the Australia Constitution Act, 1900, 63 & 64 Vict., c. 12, and Report of the (Australian) Royal Commission on the Constitution, (1929) c. XIV. These are difficulties inherent in such a federal constitutional system.
related to such commerce merely by gossamer threads and not by solid ties, would be to disrespect the judgment that is open to men who have the constitutional power and responsibility to legislate for the Nation.
* Matter of John Hancock Mutual Life Insurance Co., 26 N.L.R.B. 1024; Matter of Life Insurance Co. of Virginia, 29 N.L.R.B. 246; Matter of Life Insurance Co. of Virginia, 31 N.L.R.B. 674; Matter of Supreme Liberty Life Insurance Co., 32 N.L.R.B. 94; Matter of Life Insurance Co. of Virginia, 38 N.L.R.B. 20; Matter of Colonial Life Insurance Co. of America, 42 N.L.R.B. 1177; Matter of Metropolitan Life Insurance Co., 43 N.L.R.B. 962; Matter of Prudential Insurance Co. of America, 46 N.L.R.B. 430; Matter of Northwestern Mutual Fire Association, 46 N.L.R.B. 825; Matter of Peoples Life Insurance Co. of Washington, 46 N.L.R.B. 1115; Matter of Prudential Insurance Co. of America, 47 N.L.R.B. 1103; Matter of Prudential Insurance Co. of America, 49 N.L.R.B. 450; Matter of Life and Casualty Insurance Co. of Tennessee, 54 N.L.R.B. 1196. See also Labor Board v. Bank of America, 130 F.2d 624, 626.
The National Labor Relations Act does not vest courts with power to review the evidence presented to the Labor Board and make independent findings of fact. 29 U.S.C. § 160(e). Therefore, the propriety of the Board's order in this case must be considered on the basis of the facts the Board found.
"steady stream, into and out of Illinois, of bills, notices, and policies, the payments of commissions, the making of loans on policies, the insertion and circulation of advertising material in newspapers, and its dissemination over the radio."
among the several States," and tended "to lead to labor disputes burdening and obstructing commerce."
As a conclusion of law, the Board stated that petitioner's unfair labor practices constituted "unfair labor practices affecting commerce, within the meaning of Section 2(6) and (7) of the Act." Section 2(6) defines the term "commerce" to mean "trade, traffic, . . . ;" and Section 2(7) defines the term "affecting commerce" to mean either "in commerce" or "burdening or obstructing commerce." 49 Stat. 449, 450, 29 U.S.C. 152(6) and (7). From the language of these definitions, and the Board's findings above described, it is apparent that the Board's conclusion of law that "commerce" was "affected" by petitioner's unfair labor practices rested upon its previous conclusion of fact that petitioner's insurance business was engaged in commerce. The Board concluded that, since the insurance business itself was engaged in commerce, petitioner's refusal to bargain, and the strike thereby provoked, would affect commerce. Compare Associated Press v. Labor Board, 301 U. S. 103, 301 U. S. 128-130, with Consolidated Edison Co. v. Labor Board, 305 U. S. 197, 305 U. S. 219-224.
whenever the federal power is exerted within what would otherwise be the domain of state power, the justification of the exercise of the federal power must clearly appear."
Id.; Florida v. United States, 282 U. S. 194, 282 U. S. 211-212; cf. Phelps Dodge Corp. v. Labor Board, 313 U. S. 177, 313 U. S. 196-197; Securities and Exchange Comm'n v. Chenery Corp., 318 U. S. 80, 318 U. S. 92-95.
"Is the business of insurance commerce, and, when conducted across state lines, subject to federal regulation as such under the Commerce Clause of the Constitution?"
For the reasons given in the Court's opinions in this case and in United States v. South-Eastern Underwriters Association, 322 U. S. 533, I agree that the business of insurance is commerce, subject to federal regulation as such when conducted across state lines, and that the Board's order was proper.

References: § 10
 § 2
 § 152
 v. 
 v. 
 v. 
 v. 
 v. 
 art. 1
 § 8
 § 91
 § 51
 v. 
 § 160
 v. 
 v. 
 v. 
 v. 
 v. 
 v.