Earl Warren: Number 27, Federal Trade Commission petitioner versus Fred Meyer, Incorporated, et al. Mr. Friedman.
Daniel M. Friedman: Mr. Chief Justice and may it please the Court. This case here on a petition for certiorari -- writ of certiorari to the Court of Appeals for the Ninth Circuit, presents an important question under Section 2(d) of the Robinson-Patman Act. That section prohibits a seller from giving a promotional allowance for a customer unless he makes that promotional allowance available on proportionately equal terms to all other customers competing in the distribution of the seller's goods involved in this allowance. The question in this case is whether a seller violates that provision. When he makes a -- gives a proportional allowance to a retailer who buys directly from him but refuses to make the allowance available to wholesalers whose own retail customers compete with the direct buying retail or to put the question a little differently within the statutory term, the question is whether those circumstances that this private wholesaler is a customer competing in the distribution of goods. The case comes before this Court in a somewhat unusual factual posture and that the respondent, Fred Meyer is not the supplier who was given the discriminatory promotional allowance but the purchaser who has received. The Commission on this case found, that the respondent had violated Section 5 of the Federal Trade Commission Act by knowingly inducing a discriminatory promotional allowance that violated Section 2(d).
Abe Fortas: Are you -- are you asking us to consider this case in terms of the limitation of Section 5? That is to say Section 5 is -- the purpose of this case has not been violated unless there is a violation with 2(d)?
Daniel M. Friedman: That is correct. That is the issue under this Court's limited grant of certiorari. That's the issue before the Court because the validity of the Commission, Section 5 violation directly depend on whether the giving of this allowance violated Section 2(d).
Abe Fortas: Well, if that's -- and you agree that Section 5 could not be violated unless there is some technical terms in violation of 2(d) of the Robinson-Patman Act.
Daniel M. Friedman: That is correct. We make no contention that there's any violation to Section 5, unless there is a violation by the seller of Section 2(d). Now, the facts that are in dispute are relatively simple. The respondent operates a chain of 13 supermarkets in the Portland, Oregon area in which it sells groceries, some clothing items, drugs and various miscellaneous goods. It's a large firm. Its sales in 1957, one of the two years involved in this case totaled more than $40 million. And it also is the second largest seller of goods in the area. The Commission's case, the discriminatory allowances involved here, turned primarily upon certain things that was done by the respondent in connection with an annual promotion plan that runs a so-called “coupon book promotion”. Since 1936, each for four weeks, the respondent has conducted this coupon book promotion. I have here from the record just to be wise with the purposes of one of the coupon books. This is a little book which the respondent sells to its customers for $0.10. It contains 72 pages. Each pages of coupon advertising a particular product, I just open this at random coupon worth $0.56, amends a 100% (Inaudible) regularly up to a $1.25 a pair, $0.69 a pair. And 72 different products are involved and in each instance, the customer takes the coupon, turns the coupon in and gets some bargain. This has been a rather substantial campaign on the part of the respondent and the two years involved approximately a sale of $140,000 in one year, a $120,000 in the other year. The respondent finances the coupon book based at the actual production of the book, by charging each supplier $350 for it's own advertising in the coupon. And the total of cost, the total amount received, the 72 coupons times $350 approximates the cost to respondent in producing the book. Now, in addition to the $350, the respondent has also received from a number of the suppliers various other concessions, relating to the fact that under the plan, they sell the goods for less than the regular price. In some instances, for example, they've gotten three goods from the supplier. In other instances, the supplier has given them discounts on the price of goods. And in other instances, the supplier has redeemed coupons. It's conceded, no one questions that the initiative for this program came from the respondent. That these suppliers did not come to Fred Meyer and suggest it; Fred Meyer demanded it from the suppliers and Fred Meyer was moving forth in obtaining these allowances. After a full-hearing, the Federal Trade Commission found that the first $350, that is the amount paid for the book, constituted a promotional allowance that was illegal under Section 2(d) because it's not made available to all competing customers. And that the remaining amount of the benefit that is the free goods, the redemption of the coupons and the discounts constituted price discrimination illegal under Section 2(a) of the Clayton Act. And the Commission further held that Fred Meyer had knowingly induced these discriminatory allowances in violation of Section 2(f) of the Act that being the provision prohibiting the illegal inducement of price discrimination and Section 5 of the Trade Commission Act that relating to the allowances involved in this case. And as I have indicated, the finding that there was an illegal promotional allowance involved by the sellers of this case rested in part on the fact that two of the wholesalers to whom these allowances were denied had customers who competed at retail in selling with Fred Meyer. Now, the Court of Appeals upheld the Commission in two respects. It agreed with the Commission that Fred Meyer had knowingly induced illegal price discrimination. It also agreed with the Commission that the respondent had knowingly induced discriminatory allowances not made available to other wholesalers. There were two other wholesalers in the area -- I'm sorry, excuse me -- there are two other large retailers in the area. It agreed that the failure to make the allowance available to the other large retailer has violated the Act. The Court held, however, that the Commission was in error in predicating a violation on the fact that the suppliers had not made the allowances available to the wholesalers whose customers competed with the direct buy and retail. Because in its view, Section 2(d) only pertains to customers who compete at the same functional level, that is retailer against retailer, wholesaler against wholesaler, but not retailer as against wholesaler whose customers compete with the retailer. And the Court of Appeals therefore struck from the Commission's order, a provision which prohibited the respondent from knowingly inducing discriminatory allowances that were not made available to wholesaler whose customers competed with Fred Meyer. Now, as I have indicated, the statute which was set forth at page 3 of our brief, prohibits a seller from giving proportional allowances unless they have made available on proportionately equal terms to all customers competing in the distribution of the goods. And they think the purpose of this prohibition is very clear. It is to prevent a supplier from subsidizing the promotional and advertising activities of a particular customer unless he makes the same benefit available to those who will likely to be injured by this type of favoritism. That is to the other people competing in the distribution of these goods to the public. The promotional allowances of this type, allowing a man -- giving a man $500 because he performs certain services in connection to the distribution of the seller's good is to put really just an indirect form of the broader prohibition of the Robinson-Patman Act against price discrimination. And this Court has pointed out frequently that the basic purpose of the Robinson-Patman Act was to prevent a large buyer from getting these discriminatory advantages over his smaller competitors as a result of his superior purchasing power. In this case, it's clear that the respondent is a large buyer that it took the initiative and that actually now come to the point that the effect of this arrangement was to give at a very significant advantage over the smaller retailers in the area who competed with him. The injury that a small retailer suffers, when his wholesaler is denied of promotional allowance of this type is basically the same as if the small retailer was purchasing directly from the supplier and the discrimination was made available to one but not to the other.
Abe Fortas: But that's not his injury, is it, Mr. Friedman? His injury is if doesn't get it and that this wholesaler doesn't get it.
Daniel M. Friedman: That's right. His injury is that he doesn't get it.
Abe Fortas: And as I read the Commission's order, it makes no provision for the qualitative affair of this problem by making a promotional allowance available to the retailer advised from the wholesaler. But what it does there is to make the supplier pay all of the -- place all who left and make the allowance available to the wholesaler which it hopelessly and may not materialize, that the wholesaler will pass the allowance on to the retailer and thereby achieve the purpose in the Act.
Daniel M. Friedman: Well, we think the -- it requires him to make it available to the retailer.
Abe Fortas: That is not what it says.
Daniel M. Friedman: I'm sorry, to make it available to the wholesaler.
Abe Fortas: Wholesaler.
Daniel M. Friedman: To make it available to the wholesaler, but we think that this is basically what the statute contemplates, that what is likely to happen in this case as we have developed in our brief is very much going to be the interest of the wholesaler to see to it that these allowances that are -- have been given to the large retailers will be --
Abe Fortas: On the contrary, it may be the interest of the wholesaler to put the allowances right in his own pocket.
Daniel M. Friedman: Well, that he could not do Mr. Justice --
Abe Fortas: Why?
Daniel M. Friedman: That he could not do under provisions of the Robinson-Patman Act. Because under -- this might consist of a violation of either Section 2(f), the receipt of an illegal price discrimination or an unfair method of competition.
Abe Fortas: You're riding a little fast there.
Daniel M. Friedman: Now take it a little -- let's go back a minute. Under the statute, the requirement is that the seller must make the allowance available to all of these competing customers. It's up to the customer to decide whether he wants to take the allowance. But if he likes to take the allowance, then he has an obligation under the statute to use it for the purpose to which it is provided. That is to make it available, to be used for the purpose that is for example as an advertising allowance.
Abe Fortas: Too bad they didn't think of that -- think of that whether that's in the statute, Mr. Friedman. It's a little difficult to find them.
Daniel M. Friedman: Well --
Abe Fortas: What you've got to do is to say that 2(f) it and that's a long, hard job, isn't it?
Daniel M. Friedman: Well, it's a difficult argument or I would also suggest that it would be an unfair method of competition, Mr. Justice, for the wholesaler to take this allowance given to him because it's necessary to ensure competitive equality between the distribution system on one hand involving the wholesalers and retailers as we say and the other cases which buying retail and thus -- and then just put it in the pocket. He has taken the money for one purpose, he's taken it to the purpose of ensuring competitive equality and injured him to another purpose.
Byron R. White: Well, he just have to use it with his own customers who are competing with the other retailers who were getting the allowance.
Daniel M. Friedman: Well in this -- he would. In this particular case, the Commission found that there were a large number or in fact virtually all of the customers in the City of Portland to be wholesalers were competing. Fred Meyer has advertised to the state that it has a supermarket in every part of the town. And there is evidence that the two wholesalers, one had I think hundred retail customers and the other had 40 retail customers. There is a testimony by some of them at least but they did directly compete with Fred Meyer's stores. He would have to -- he would have to make it available. Now, what we give as an example in this particular case, what was involved was a promotional allowance. That is a giving of money for this particular form of promotion if some of the suppliers -- if they would, some of the suppliers which of this type of promotion would have to make it available. On the other hand, there may be equivalent forms of promotion that would be available for some of these smaller retailers. Now, it doesn't have to -- they don't have to make the allowance available for the exact same thing that was given to the one say the customers. They have to give them comparable --
Byron R. White: The way you read it now doesn't sound as too much (Inaudible).
Daniel M. Friedman: But there is this difference -- I think there is a basic difference. Commissioner Elman would say, I think that in this case the retailer is a customer.
Byron R. White: I know but the end result -- there is no difference. You say the wholesaler although he gets it, has to use it to give a fantastic benefit on to the retailer's customers.
Daniel M. Friedman: He would have to. But Commissioner --
Byron R. White: And the end result would be the same.
Daniel M. Friedman: Except that under Commissioner Elman's theory, the wholesaler would have no discretion whether to accept it or not. In other words, as I understand Commissioner Elman's theory, he says that what the supplier should do is go to the retailer.
Byron R. White: So the wholesalers can make up his mind as to whether the retailer is competitive disadvantage.
Daniel M. Friedman: Well, the wholesaler -- the wholesaler can decide where he wants to make it available to the retailers.
Byron R. White: And if the -- whether or not the retailer will or will not be at a competitive disadvantage.
Daniel M. Friedman: Well, in that sense, yes. But it's very much to the wholesalers interest we think that accept these allowances because these allowances to be passed on to the retailers, are obviously going to read down to the benefit of the retailers. They're going to increase the retailer's sales. And this in turn will directly increase the wholesaler's sales. So we think as a matter of self-interest, the wholesaler will be very anxious to receive these promotional allowances. Now, there are -- I'd like to point out a couple of the anomalies and rather inconsistent results of flow from the Court of Appeals' interpretation of the statute, both of which the Commission refers to. In the first instance, let's assume the market where there are two large chains. Both of whom buy directly from a supplier. In addition to that, there's a wholesaler in the market who supplies all of the existing small retailers. The -- under the Court of Appeals' interpretation, if the seller gives one of these allowances to a chain, one of the chains, it is required to make it available to the other chain. Yet at the same time, it is not required to make it available to the wholesaler. But this means basically, that the firm best able to protect itself because of its economic power, the second chain gets the benefit of this action. Whereas the people who least able in the long run, the wholesalers do not get the benefit of this thing. That is the people least able to protect themselves. The people who need the protection of the statute most are denied that right. Now, the statute uses the words competing in the distribution of the seller's goods. And we think in the light of the purposes of the Robinson-Patman Act that what this means is, it's seeking to protect the entire distribution process by which goods flow from the supplier through the wholesaler to the retailer to the ultimate consumer. Now, the wholesaler we think, in this light of this purpose make fairly be viewed as competing in the distribution of the seller's goods. Because he, together with retailers form a conduit, form a distribution unit by which the goods are distributed. The direct buying retailer in this kind of a case basically combines the function of the wholesaler and the retailer in a single entity. And it seems to us that what Congress was intending to protect here, to avoid the dangers of being powerful buying organization, bringing their power to bear in getting advantage is not available to the small merchant which is necessary to accomplish this protection.
Abe Fortas: But you have any difficulty in looking at this acrobatic fee that's so often has to be in the form of the statute, looking at it upside down and saying that -- and saying that the retailer in these circumstances, the retailers buys from the wholesalers through indirect customer or the supplier and indirect customer is still a customer that you will be dealing with tomorrow. And therefore it's the duty of the supplier to that an opportunity to get in these great benefaction goes to the indirect retailer or direct customers.
Daniel M. Friedman: I have to answer it this way, Mr. Justice. I would not have any difficulty with that argument. I think the Commission would because the Commission has always said that for the retailer to be viewed as an indirect customer there has to be something more in a way of a connection from the supplier to the retailer.
Abe Fortas: I'm aware of that but what bothers me is what the Commission did is that the supplier lacks the -- it seems that they were down to the enrichment of wholesalers and not trickle down to retailers whom the Act by hypothesis has intended to benefit and protect. The Act is interested in small retailers would buy through wholesalers, that's a common picture. And that these wholesalers are given some benefits to guide in some of your argument which I certainly respect. There is no assurance whatever that the benefits will be passed on to the competing retailer. I don't -- I have difficulty saying that that advances the purposes of the Act.
Daniel M. Friedman: Well, I think Mr. Justice that we have no assurance any more than we have assurance that if one of these allowances has made available to someone who is directly competing, that he will accept it. I mean anyone of course is free project and allowed. But it seems to us there are a couple of considerations which indicate that the wholesalers will want to take advantage of this allowance. One thing as I suggest, it's just in their self-interest because this allowance rids down to the benefit of a customer it seems to us, it will be to the benefit into the advantage of the wholesaler to take little steps that will facilitate increasing the benefit of its customers. Then another suggestion we make in our brief is that if you have a market with more than one wholesaler, one wholesaler is giving this advantage to his customers and it seems to be it won't be long before the other customer will be coerced to do so. It just seems to us that while you -- you can't force the horse to drink but at least give him a chance to get to the water.
Abe Fortas: (Inaudible)
Daniel M. Friedman: I think that what is involved in this case basically is that this may not be a perfect solution to the problem. But that this at least facilitates it. In other words, at least the retailer should have the opportunity to get to the benefit of having his wholesaler in the position to pass these things on to him. Now, I'd like to refer to one other anomalous result of the Court of Appeals' decision, which is this. Under the price discrimination provisions of the Robinson-Patman Act that is Section 2(a), it has long been viewed as subtle since this Court's decision in the Morton Salt case, that it is a violation of Section 2(a) if a seller discriminates in price between a direct buying retailer and a wholesaler whose customers compete with that direct buying retailer. Now, since these discriminatory promotional allowances are about one form of the larger species of price discrimination condemned in the statute, it seems to us it'd be most anomalous to say, that if a seller engages in the direct form of price discrimination, that is he actually gives a price discrimination to a direct buying retailer but refuses to make it available to the wholesaler whose customers compete, he's violated the law. Yet, if he does it through the device of a promotional allowance, the benefits are not available to the direct buying retailer.
Byron R. White: But in that case, you do call the retailer-purchaser, the indirect purchaser, don't you?
Daniel M. Friedman: No we do not Mr. Justice --
Byron R. White: What do you say?
Daniel M. Friedman: No, no we would not call an indirect purchaser unless there was some direct relationship between the seller and the customer.
Byron R. White: Well, but the 2(a) says purchasers.
Daniel M. Friedman: 2(a) says purchasers or customers of purchasers. If the 2(a) --
Byron R. White: Yes, I --
Daniel M. Friedman: 2(a) -- now they rely -- they rely upon -- our opponents rely on that distinction in the language. They say, you can't fairly compare the two because 2(a) in terms speaks discrimination, the effect of which maybe the less in competition with the seller or the customers of the people receiving the benefit of the discrimination. We suggest that that is no ground of distinction for two reasons. First, in terms of the basic policy, I don't think it makes any difference. And secondly, that provision as we read that merely indicates what the Commission has to show in order to establish a violation. That is it defines the kind of showing of competitive injury the Commission must make in order to establish the violation. And Congress has -- in dealing with Section 2(d), the discriminatory allowances provision has imposed a per se rule. It is limited -- eliminated. This is the need of showing injury to competition or it has also eliminated the coerced justification provision and it seems to us that it read the strange rule to suggest that what Congress has made a strict provision in dealing with promotional allowances than in dealing with coerced direct price discriminations that a seller may do -- may accomplish as a discriminatory allowance but he's prohibited from doing as a price discrimination.
Abe Fortas: Mr. Friedman, would you measure the offer that has to be made to the wholesaler in terms of the wholesaler's volume. Let's assume that the 2(d) the violation consisted of a payment for services measured by volumes. On the base of the Commission's order, I assume that the wholesaler would be entitled to that kind of volume measured payment himself, wouldn't he?
Daniel M. Friedman: I would think so.
Abe Fortas: And then when he passes it on to a retailer, he may -- as a result favor one retailer who over another who was a direct buying customer from the supplier.
Daniel M. Friedman: I would think Mr. Justice, he has to pass --
Abe Fortas: I mean -- the question again, I don't want to take more of your time but the question again is whether you don't get this whole thing out of the sculpture, once you start measuring it in terms of the wholesaler, which I take the Commission order to affirm?
Daniel M. Friedman: I would think Mr. Justice that he would be obligated to pass it on to his retail customers in the same basis which he got it.
Abe Fortas: Well, then a retailer customer who buys to the wholesaler gets an advantage over a retailer who buys direct from the supplier in the same volume. You figure that out. Excuse me for taking so much of your time. I think you'll find the word to that.
Daniel M. Friedman: I have to think about it Mr. Justice. I'd like to reserve a balance of my time.
Earl Warren: You may. Mr. Howrey.
Edward F. Howrey: Mr. Chief Justice and may it please the Court. I should like to discuss two propositions. First, that the statute involved here namely 2(d) of the Robinson-Patman Act means exactly what it says. And when that refers to competing customers, it refers to competitors who compete with each other and who buy for a business of the same third person. In other words, the customers who compete at the same functional level, and secondly, that the Government's construction requiring proportional payments to wholesalers with the hope that the wholesaler will pass it on to the retailers is administrative and practical, and impossible application in the day-to-day, early-burley commercial work. First, the Government tries to analogize 2(d) to 2(a) of the Robinson-Patman Act. I may say that since 2(a), a more solved case, prohibits the price discrimination whether, it does refer to promotional allowances prohibits the price discrimination between direct buying retailers and wholesalers whose customers compete with direct buying retailer that 2(d) should be construed the same way. And now the difficulty here is that 2(d) is entirely different statute from 2(a), has entirely differently language. 2(a) for example, prohibits the price discrimination which may injure competition with any person who either grants or receives the benefit of the discrimination or with customers of either of that. It covers the primary line, secondary line and the so-called tertiary line. The 2(d) doesn't contain language that even resembles them. 2(d) simply prohibits non-proportional promotional allowances only as between “customers competing” in the distribution of the particular product. Now, the Government argues in effect that the word distribution as used in Section 2(d), negates or at least modifies the word ‘competing'. So as to give the word ‘competing' or ‘competition' an entirely different meaning of the dictionary or from the commonly accepted meaning of the word, particularly in the antitrust field. In other words, the Government rewrites the statute, strikes out the words competing customers and inserts the words engaged in, so as to prohibit non-proportional payments to anyone engaged in the distribution of the product. Now, we think such rewriting the statute should be left with the Congress. Particularly, in view of the history of antitrust legislation, the Congress passed the Sherman Act that prohibits or restraints a trade then passed the Federal Trade Commission Act and prohibit unfair methods of competition. But when they came to Clayton Act and more particularly to the Robinson-Patman Act and amended it, they got very specific and they dealt with specific problems in specific language. And 2(d) is one of the most specific of all, because it is an amendment to promotional allowances to foresee statute limited to promotional allowances. So, in passing 2(d), Congress didn't give a three formed mandate for the Federal Trade Commission to cure any and all ills that they might find to exist in this field. For example, if I may again go back to comparison of 2(a) and 2(d), 2 (a) as I said covered primarily line as a cost justification proviso. It intended to save the economies at large scale buying for the consumer, and it had many passed exhibit which 2(d) doesn't view at all. 2(d) is considered that --
Abe Fortas: But you don't have any question Mr. Howrey about the congressional intent here being inconsistent with what the Commission did. The congressional intent being that, if you will offer a promotional allowance to one retailer, the promotional allowance has to be offered to retailers who compete with him and then you get difficulty because of the enacted language. Because the statute says, it uses the word ‘customer'. The retailer has to be in competition and it has to be a customer and the question here then is whether the statute can be read within accepted legal and judicial techniques so as to carry out the intent of Congress whether the Federal Trade Commission has been here. That's what comes down to it.
Edward F. Howrey: Basically, Mr. Justice Fortas, that is correct but I do not believe that it would interpret the statute differently from the words which the statute used which is ‘competing customers'. You spoke of the general legislative intent as expressed -- the Government in its brief -- the referring language which this Court used in the Broch case which you would paraphrase in your question. But if you will return to more recent Sun Oil case, you use different language. This Court used different language. They said, I quote, “Congress intended to assure that businessmen at same functional level would start on equal competitive footings.” So I don't think that the Congress intended --
Abe Fortas: But that doesn't help you at all, does it? It didn't help you really because, obviously, what Congress intended here was that retailer as against retailer who got their suppliers from the same supplier would be on the same basis. Now, if these -- if they were not a wholesaler here, they were not a wholesaler let's say but an agency -- an agency either of the retailer which sometimes happens or the resource, the supplier, you wouldn't have any question, would you?
Edward F. Howrey: Not the slightest --
Abe Fortas: Then the 2(d) allowance would have to be offered. That's what we're troubled about here is the circumstances of title.
Edward F. Howrey: Well, the Court of Appeals if that's what you're saying. The Court said that if these retailers who buy from wholesalers were indirect customers. By then, they would be required -- the supplier would give a proportion on his balance but there was a specific finding that they were not indirect customers in the sense that the supplier did not deal directly with him. So -- well, I would concede the Robinson-Patman Act's general purpose. That's in fact the record says, still they use specific language to deal with specific problems and I think the problem with the Act of Congress do not strike out words which were the statute namely ‘competing customers'. And in the Sun Oil case, just decided by this Court in 1963, the Court said precisely the same thing. There, the Government was contending just the opposite of what they contend now. There they were contending that you couldn't ignore the functional levels. You will recall that that case arose under 2(b) of the Robinson-Patman Act which permits a seller to be competition. And there this Court held that the defense meeting competition was not available to a gasoline with client who gave lower prices to the service station customer to enable to meet the price of the competitive service station across the street. There, this Court said that you can't expand the word ‘competition' to include customers at different functional levels. And there the Sun Oil Company used exactly the same argument which the Government uses here namely that the buyer, the customer in that service station was just conduit to the consumer. Here, the Government says to the wholesaler, it is just a conduit to the retailer. But this Court rejected that argument and as I recall it did so unanimously. Thus, that ends the discussion of my first proposition, namely that statute means what it says and in order to hold otherwise, with respect to submit to this Court would have to strike out the word ‘competing' and insert the word ‘engaged'. Now, the second argument, I should like to make is that if we adopt the government structure, it would be impossible of application. Now, the rationale, I agree with Mr. Justice Fortas, that there is no compulsion here for the wholesaler to pass it on profitable on how they -- but the rationale of the Government's argument is that it should be passed on and that the customer of the wholesaler's disadvantage because he's a small retailer and he doesn't get what he argued competitively. There again, I said the Robinson-Patman Act can't cure all ills. And if they try to do it here, let's take an in-store promotion for example. The Commission suggests that the wholesaler -- it's just $350 the Government suggests that the wholesaler fragment that $350 and proportionalize payments to over a hundred retailers. $350 not a -- on the average $350 but I supposed the wholesaler would have to try to do it to buy them so it would ascertain the dollar volume of the quantity that each 100 -- each of the 100 retailers try to proportionalize these payments so that can get down to almost ridiculous sum of maybe a dollar here and maybe $3 there and $5 --
Abe Fortas: Why shouldn't every retailer competing with the direct retailer or purchaser to get that opportunity to get that $350, that's what -- isn't that the intent of the Act by getting the barbarous language.
Edward F. Howrey: Well, if the intent of the Act is proportionalize based on dollar volume or --
Abe Fortas: I understand that but I say that here, what's happening is that $350 is given for a page and that if any retailer wants to provide the same service or to be able to get the $350 and that's the theory of the Act.
Edward F. Howrey: That's the theory of the Act. But the --
Abe Fortas: It's not that the wholesaler in getting and then fragmented as you've stated and that's my problem (Voice Overlap) the Commission's approach to this --
Edward F. Howrey: The Government as -- I mean the Federal Trade Commission and its order hasn't provided the retailer to get it and the Government in its brief rejects the dissenting opinion. So we're placed here with a case where the supplier has ordered to pay it to the wholesaler, to the hope that you passed it on. But still, you have to be -- one has to be practical I think in this commercial world. And I say that it would be impossible to a wholesaler to do all the things that the FTC Guide require him to do with these hundred retailers. First, you have to go and find out which one of them actually competes with the direct buying retailer. Then he would have to find out what proportion those to each of these, and I say it would be a rudimentary portion. Then he has to ascertain whether the plan is suitable for the small retailer and obviously the plan involved here was not to be suitable to little retailers because this involve a coupon book promotion. Covering four weeks time, covering in store -- and a small retailer who buys from wholesaler wouldn't want to put in use such promotion. So this wholesaler would have to go to each of the 800 customers and devise an alternative plan so that he could have the benefit of it and it would be of some use. Then he'd have to collect the money from the supplier, passing on to these hundred retailers. You'd have to see that it was actually used and if it he didn't use at all, he'd have to see that he did. I say that that's impossible on application. Now, the Government recognizes that that might be difficult but they say in some instances in advertising for example, would there be no problem because the wholesaler could do the advertising for the retailer. They could publish the ads and say, go to so and so retailer and get direct buyers of goods. Well, the difficulty with that is, that every or universally I would suggest, the advertisements of food retailers combined product and price. You never pick up an ad of a supermarket and just see meat advertised, you see the price under. So here, you would have the wholesaler, publishing ad for hundred retailers giving a price. They couldn't have separate ads -- they'd have to have a joint or a common ad. So, you would have a situation I would suggest where you'd have a direct Sherman Act violation suggested by the Government, financed by the supplier and managed by the wholesaler. And that it's exactly what of become to if the wholesaler has to do the advertising for his hundred retailers. Well, the Government has suggested another alternative that might not be too difficult. They suggest as I take it has been suggested here this afternoon that the retailer or that the supplier deal directly with the wholesaler's retail customers. So the wholesaler would be added with all to these. So now, in that case, their deal directly may become under the decisions an indirect customer. Therefore, you have the Robinson-Patman Act questions and Sherman Act questions raised. The supplier would have to police and supervise the wholesaler's prices to these hundred retail customers to see that they were not discriminatory among themselves and perhaps more importantly incomparable with supplier's prices to the direct buying retailer. So you'd -- he'd have to do that to avoid the Robinson-Patman Act, price discrimination law. But the minute he polices the wholesaler's prices, he engages in resale price maintenance. So I suggest there again, the Government has suggested an alternative which has violative of two other laws. And in the impossibility or impractibility of the Commission's order is even more apparent when you would apply the principle to a more complex method of distribution such as where you have a job before you get to the wholesaler. There, you'd have the job for the wholesaler and the retailer and there are even variations of that. So I think if the Commission's order is affirmed by this Court, it will have a devastating effect on the distribution system of this country. It will either put the wholesaler out of business or can go away with promotion allowances (Voice Overlap) --
Abe Fortas: I merely haven't quite got that facet, Mr. Howrey. As I understand the theory of the Act, it is that -- it's an admonition in effect, a legal instruction in effect to suppliers to device promotional systems that are capable of being administered in whatever way the Act says and the general purpose however inevitably expressed is that you have to device a promotional system that is capable of being offered on proportionally equal terms to all retailers who are in competition one with the other. And if I -- if your particular promotional scheme can't be so administered, why don't use it, that's what the Act says and sometimes it is indeed, established ingenuity.
Edward F. Howrey: I don't think the Act says that here. I think it says the competing customers. In fact it does say that, well how you interpret that, well it's a different thing. But I go back to where the language of the antitrust field, no word is more used or more understood than the word ‘competition'. And you can search every picture in or look at every antitrust opinion that I've ever seen and the word ‘competition' refers to competitors who buy or a customer or business of the same third person. Now, if you just want to forget the functional system, why -- you could do it but it certainly is a concept which I think shakes the foundations of the distribution work. I think I've covered the two propositions I started to discuss and since I have a minute left, I would like to add the third argument. And that is that this issue that is before this Court was not tried. For 25 years, the Commissions and the courts had held that you didn't have to proportionalize promotion allowances as between retailers and wholesalers. In fact, when the hearing were going on in this case, the Commission decided to link Meyers to back up case and then repeat what it had held before that proportionalization was required only among customers competing at the same functional level. And then when this case came up, they expressly reversed Meyers and held the contrary. So, the issue was not post in the complaint, it was not tried, no evidence was submitted on the issue, the -- it was assumed once you showed there wholesalers that they didn't -- that was an absolute defense that isn't covered within 2(d). Now, of course the Commission has the right to reverse itself as the courts would like to do. But it seems to me that if they're going to do it at the very minimum, it should be -- minimum of course, it should be followed would be to wait until the case comes up where the issue is posed by the pleading. The evidence is introduced and the case is decided in broad daylight and not by just a change of law based on a record which merits on all the things I've talked about exactly. There's nothing in the record about how difficult it would be to administer because it wasn't an issue. Thank you very much.
Earl Warren: Mr. Friedman.
Daniel M. Friedman: Mr. Chief Justice and may it please the Court. On the point that Mr. Howrey has just made that this issue was not adequately presented to the Commission. I'd like to invite the Court's attention to pages 107 to 113 of the record, the Commission's opinion on the exceptions to the proposed form of order in which the Commission points out that all of the facts involved in this case were fully litigated. The respondents were unnoticed in this case when the Commission counsel began putting in its quote that the Commission was treating wholesalers as the customers competing in the distribution because they introduced a lot of evidence dealing with that. And of course, in the issue under the price fixing section of the complaint, 2(a), 2(f) charge. Of course under a central line of authority that particular issue was opened in terms of whether there was -- whether the wholesalers had retail customers who were competing. The only thing that was not litigated during the course of the initial Commission hearing was the legal issue. The legal issue whether under Section 2(d), the wholesalers need circumstances that were competing in the distribution of the goods within the meaning of the statute. And that issue was fully argued by the respondent in the exceptions to the proposed order which for the first time, specifically dealt with this issue and the Commission analyzed the problem and disposed of it in its opinion. So we don't think that there's any basis of the claim which is now asserted that the record in this case is not adequate to dispose off the issue. The suggestion that all of the contentions to which Mr. Howrey eludes that there was no record evidence upon which that could be based, this symbolized the kind of factual economic arguments that are always in advance to justify a particular construction of the statute. It was never suggested by the respondent in the exceptions before the Commission on the form of the order that the record was inadequate to permit a judgment, a determination of this issue. The argument was that the Commission was wrong as in the matter of law. So in terms of the fairness of this, we think that this record thus fully presents all the evidence necessary and if the case is inappropriate posture for this Court to decide. Thank you.


Warren E. Burger: The case is submitted. We'll hear arguments next in United States against Mitchell. Mr. Claiborne, I think you may proceed whenever you're ready.
Louis F. Claiborne: Mr. Chief Justice, may it please the Court. This case is here from the judgment of the Court of Claims on the petition of the United States. In that court, the plaintiffs were, first, some 1500 Indian allottees on association consisting of those allottees and perhaps others and the Quinault Tribe, itself. The case concerns the management of timber on the Quinault Reservation. That reservation was created in 1873 by a presidential order. It was provided for some 20 years earlier by a treaty leaving the location and dimensions of the reservation to be determined by the President at some later time. The reservation consists of some 200,000 acres of land mostly covered by timber. Some one-third of that area has now been taken out of trust, but the remainder in the land, we are told, involved in this case, is some 130,000 acres of timberland. Because the land was overgrown with timber, it was originally thought that it was not appropriate for allotment into individual parcels. But -- and indeed, that was the administrative view until this Court set the matter right in 1924. During the decade that followed this Court's decision in Payne in 1924 and until 1933 or 1934 or 1935, most of these reservation was allotted in individual parcels or indeed, perhaps, all of it was. Typically, there were 80-acre allotments and we're told some 2000 of them. The tribal interest here is derivative in that since the Indian Reorganization Act, some small portion of the allotted lands have returned in the tribal ownership, but a mere 4000 acres as compared to the very much larger portion in individual allotments. Beginning in 1910, the Secretary of the Interior was given statutory authority to consent to the sale of timber on Indian-allotted land, as well as on Indian tribal land. And whether or not, those allotted lands were technically held in trust or were held by some restricted patent. In 1934, as a part of the Indian Reorganization Act, the Secretary was required when managing Indian timberlands to do so, on a sustained-yield basis. These plaintiffs brought this action in the Court of Claims alleging a number of complaints against the Secretary's management of their timberlands. They said that he had failed to obtain a fair market value in the sales contracts. That he had failed to manage it on sustained-yield basis. That he failed, in some cases, to obtain any payment for the timber. That he'd not developed the proper system of roads and that he'd made improper charges against the allottees for some of those roadworks. That he'd fail to pay interest on certain sums or insufficient interest and finally that he had exacted excessive administrative charges of being cleared that the Secretary's entitled to make a charge for his management of the timber but the allottees claimed the actual charges were excessive. In all of these respects of course, the allottees claimed money damages. It's fair to say that the case proceeded for some years in the Court of Claims before the United States interposed the defense which is presently before this Court. That defense, the motion to dismiss was premised on the notion that these claims were monetary relief against the United States in respect of its management of the timber, did not lie under the Tucker Act or under its counterpart Section 1505 of the Judicial Code, in the Court of Claims or indeed in any other Court. That defense was no doubt accounted by this Court's decision in United States v. Testan in 1976. At all events, when the motion came before the Court of Claims, that Court overruled it holding that applying the rationale of Testan and its own decisions, the United States here through its agent, the Secretary of the Interior, the Bureau of Indian Affairs, had violated statutory duties which fairly mandated compensation in damages under the Tucker Act or under Section 1505 against the United States. It is that ruling against which we complain. The case is primarily one under the Tucker Act, Section 1491 of the Judicial Code. Much is made of the companion provision as we call it, Section 1505, which pertains however, only to the claims of Indian tribes or identifiable groups. Here the great majority of the plaintiffs or individual allottees who cannot, whenever you make any claim, except under the Tucker Act itself. And indeed the Court of Claims did not suggest otherwise. 1505 was in the case, in view of the Court of Claims simply because there is a small tribal claim. At all events, as we've elaborated in our brief, the two statutory provisions are entirely quite extensive. 1505 allows no more monetary relief than does the Tucker Act, itself.
Potter Stewart: Mr. Claiborne, in your brief you indicate one and only question is presented, but doesn't the question embrace at least two -- two questions? First of all is there a private right of action created and secondly, if so, as the answer -- if the answer to that is, yes, does the defendant have sovereign immunity?
Louis F. Claiborne: Mr. Justice Stewart, in the context of this case, a case based entirely on an act of Congress within the terminology of the Tucker Act, we view those questions as the same, analytically different, but in practice, the same. And may I --
Potter Stewart: I suppose if Congress had a created a prior right of action, it would thereby waive the sovereign immunity.
Louis F. Claiborne: Exactly, exactly.
Potter Stewart: But nonetheless, aren't -- aren't there two questions?
Louis F. Claiborne: Analytically, Mr. Justice Stewart, I think you're right. There are two questions. We placed our entire emphasis on the first of those of questions that is, did Congress in the General Allotment Act primarily relied on and entirely relied by the Court of Claims, impliedly or expressly create a right of action in money damages?
Potter Stewart: Against the United States?
Louis F. Claiborne: Against the United States, when a -- an alleged breach of trust duty is found.
Byron R. White: Well, the Court of Claims doesn't disagree with you does it on the fact that you must find some -- some kind of a substantive right in the -- in some statutes other than the jurisdictional statutes?
Louis F. Claiborne: That is so, Mr. Justice White.
Byron R. White: And so you did just differ on whether you do find that?
Louis F. Claiborne: Our disagreement is with the ease with which they find such a relaxation of the rule.
Byron R. White: Mr. Claiborne, could you tell me where do you find the waiver of sovereign immunity in the ordinary contract case? And where do you find the implied right? Then United States just signs a contract for a -- a construction contract to -- to build a building or something and then it allegedly is breached.
Louis F. Claiborne: Mr. Justice White, I have some difficulty reconciling my answer with to look for words of the test in opinion.
Byron R. White: Yes.
Louis F. Claiborne: And so --
Byron R. White: To go ahead and try.
Louis F. Claiborne: It will -- I have to -- I have to read the Testan or perhaps less strictly than its words say. Testan says that the Tucker Act is no more than a jurisdictional statute. If by that is meant, the Court which will hear such a claim, I have to suggest that that language is too narrow for --
Byron R. White: Well, you mean it -- do you mean that the Tucker Act actually contains the -- the waiver of sovereign immunity?
Louis F. Claiborne: Well, the Tucker when one looks at its original language and when one reads the long list of cases in this Court must in some sense be viewed as a waiver of sovereign of immunity.
Byron R. White: So you -- so you look to that -- that contains the waiver of sovereign, but it's still doesn't get you home because you must have a -- implied right of action somewhere?
Louis F. Claiborne: Exactly so.
Byron R. White: Or expressed.
Louis F. Claiborne: And in a contract case, it's set that the Tucker Act, it waives a sovereign immunity of the United States. It can't be the government contractor who has no such power.
Byron R. White: So that you don't -- so that you don't when come around in finding out if there is a private cause of action, you aren't -- don't have the -- you don't approach it as you would a sovereign immunity question. Namely --
Louis F. Claiborne: Well --
Byron R. White: -- a very strict construction.
Louis F. Claiborne: Mr. Justice White, my answer is -- is the opposite.
Byron R. White: That it was --
Louis F. Claiborne: One does approach it.
Byron R. White: -- because it would expand the sovereign immunity, do we have a loose construction?
Louis F. Claiborne: Exactly. Precisely, because of the Tucker Act is a waiver of sovereign immunity in some sense, one must construe it narrowly. And because the very same considerations go to determining whether or not, the United States has made itself liable in damages as the question whether the United States has opened itself to suit in anyway. I would put it in this way, if I may. That is a presumption against monetary liability of the Government. That presumption derives from the principle of sovereign immunity from all suits. But the principle of sovereign immunity -- the core of it is liability in -- to a judgment which will expand itself against the Federal Treasury or against the federal land. Indeed, there are suggestions that that's all it's left of the doctrine of sovereign immunity.
Byron R. White: Or you would say then -- you would say then, if you were in a District Court in a -- in some kind of a case and then the question was an injunction, there wouldn't be any -- there wouldn't be a sovereign immunity case?
Louis F. Claiborne: Exactly so. I would have said that Mr. Justice White, even before the amendment of the Administrative Procedure Act --
Byron R. White: And no -- so you -- even if you are in the Court of the Claims and the issue is a -- is a -- an injunction, the -- the party seeking the injunction might lose, but not because of sovereign immunity. It be because of the limits of the jurisdiction of the Court of Claims.
Louis F. Claiborne: Exactly so. And of course, it's not novel notion that the United States and its offices open themselves up to actions for prospective relief and hold the bar to accountability in money damages. One need only think of the hundreds of cases in which courts review the action of administrators without there being any sovereign immunity bar and courts do direct that different action be taken in the future, whether it's matter of -- of the FDA, withholding improperly permission to market a new drug or any other example, one can think of. The Department of Interior making an error in surveying land, those are matters which are correctible by courts for the future. And indeed, to some extent perhaps retroactively, but which do not give rise to liability and damages against the United States.
Byron R. White: But if you find there are some statutes that you think clearly enough gives a substantive right to damages to a private individual, if you just post that kind of a statute, you can take it to the Court of Claims. You can have your -- have your case in the Court of Claims and the sovereign immunity is -- is not an issue at all.
Louis F. Claiborne: Mr. Justice White, I think it's right that if one finds a statutory duty which clearly permits recovering damages for breach, the function of the Tucker Act in such a case is to permit you to join the United States in name.
Byron R. White: And even if you find the statute as very arguable and you file in a Court of Claims, the argument is not sovereign immunity, but the argument you're making here.
Louis F. Claiborne: Exactly so. And that to -- to come to --
John Paul Stevens: Mr. Claiborne, before you -- before you leave that line of inquiry that Mr. Justice White raised I want to be sure I understand your response to his question about the ordinary breach of contract case, where the contractor claims the Government defaulted on an obligation and so forth. What is the source of the implied cause of action in that sort of case?
Louis F. Claiborne: The Court -- Mr. Justice Stevens, I think one must say that the tradition that the remedy for breach of contract is money, is the source of the obligation of the United States, like any other contractor when breaching a contract to pay. The ability to sue the United States is granted by the Tucker Act in waiving the technical objection of sovereign immunity.
John Paul Stevens: So that whatever -- whether we're talking here of the waiver of sovereign immunity or creation of cause of action, whatever we need in the way of statutory authority for the litigation to proceed, it's found in the Tucker Act?
Louis F. Claiborne: If it -- but in a contract case, which of course is -- is not the category we're concerned with today, it is the law of contracts that provides the remedy in damages. In --
John Paul Stevens: Then why doesn't the law of trust provide the remedy here?
Louis F. Claiborne: Well, there is --
John Paul Stevens: It's for the next question here. You have to keep in mind.
Louis F. Claiborne: There isn't a reliance here on the law of trust or I can say the common law of trust because it's a doctrine of equity but the unwritten law of trust is not what is invoked in this case. And indeed that judgment of the Court of Claims is very plain that there is no reliance on the law of trust generally or even on the fiduciary relationship between Indians in the United States. The reliance is on an act of Congress and specifically on the General Allotment Act of 1887.
John Paul Stevens: It may just be a stronger case to recovery.
Louis F. Claiborne: I'm sorry.
John Paul Stevens: So then, shouldn't this be a stronger case for recognizing the claim?
Louis F. Claiborne: When -- when reliance is placed on act of Congress, Mr. Justice Stevens, we say following the Testan that one must find in that act of Congress, a provision fairly read as mandating a recovery in damages against the Government. And that is simply, wholly absent with respect to the General Allotment Act. There is no suggestion here that the origin of the right to collect damages is based on law of trust, generally. And indeed, one might have a question why the law of trust like the law of contract isn't -- doesn't afford the same remedy under the Tucker Act. The answer must be that whereas the Tucker Act lists certain categories, it does not list law of trust as one of them. It lists contracts. It lists acts of Congress. It lists the Constitution. It lists regulations, but not the law of trust. And it expressly excludes the law of torts. Now, the -- the question is we've seen --
Potter Stewart: But does generically -- arguably, covered it says, “The Court of Claims shall jurisdiction to entertain a suit for liquidated or unliquidated damages in cases not sounding in tort and that would generically include the law of trust or any other law except tort. Wouldn't --
Louis F. Claiborne: Mr. Justice Stewart, commentators in courts have pondered over that last clause --
Potter Stewart: I am -- I am now doing so too.
Louis F. Claiborne: -- and have usually answered that it simply cannot be read literally. For if it were, it would absolve all that came before.
Potter Stewart: Everything else.
Louis F. Claiborne: It would be meaningless. And therefore the answer given usually is that that clause cannot be read as it's written, but must be deemed to mean two things. First, that damages may be recovered even though unliquidated. And secondly, that recovery in tort is never permitted. And that the clause qualifies all that comes before.
Potter Stewart: It's not permitted by the Tucker Act. It is (Voice Overlap) --
Louis F. Claiborne: No. Not permitted by the Tucker Act. And indeed, in this case, the Court of Claims in its words, skipped over that last clause placing no reliance on it and the plaintiffs below have made no reliance on it. They did flirt with either one stage, but in their brief on the merits, they have abandoned any reliance on it. Coming now to the question whether the statute invoked the General Allotment Act of 188,7 can be read as fairly mandating relief of damages, we think the answer clear, that statute contemplated the scheme whereby the land of the reservation would be divided among the Indians within 25 years and in the meantime, the United States was simply to hold title in trust solely for the purpose of preventing state taxation it being a legal title in the United States and therefore, exempt from state taxation.
Byron R. White: Do you plead -- do you think that the question of construing a statute in order to ascertain whether the Congress intended to give a cause of action for damages, you think that our -- our constructional problem is different than in say, cases like Cort against Ash? You would -- you would say those -- that -- that set of rules just doesn't apply here or not?
Louis F. Claiborne: I would, Mr. Justice White, say that some of those rules do apply as they were indeed (Voice Overlap) --
Byron R. White: Well, maybe some of them, but you would just say -- you -- you wouldn't say, “Well, let's just approach this problem in the same as you would in determining whether under the Securities Law, Congress intended a private cause of action.
Louis F. Claiborne: No, but, Mr. Justice White, to that extent I invoke the approach followed in Testan that is that one requires a very clear indication if not an expressed statement in the act of Congress relied on that the remedy for its breach shall be damages. Where no --
Byron R. White: We must not only find the right, but the remedy --
Louis F. Claiborne: But the (Voice Overlap) --
Byron R. White: in the (Voice Overlap) statute.
Louis F. Claiborne: Exactly so. The sovereign immunity may be weighed by the Tucker Act, but the remedy and the right must post originate from the same statute relied on. And --
Harry A. Blackmun: The point in the United States did not press the issue of jurisdiction in U.S. against Mason, did it?
Louis F. Claiborne: That is certainly true Mr. Justice Blackmun whether it was simply overlooked or whether it was thought that was an exceptional case in that, the very purpose of the General Allotment Act had been to exempt the allotted lands from state taxes. And that case involved the question whether the United States had breached its duty to assure that exemption from state taxes, by failing to or by paying over voluntarily the state taxes. They might there have been a clear -- clearer relation between the breach alleged and the purpose of the statute whereas here, we're at thorough move from that situation. We also bid that in Mason, the view could've been taken that we were paying with the Indians' money, the taxes which arguably, they did not owe. And to that extent, we were misappropriating funds. The kind of activity which the Testan opinion recognizes does not require the same -- the same expressed provision in the statute. The purposes of the General Allotment Act make it clear that the Congress of 1887, which wrote that statute, would never regret of providing that the United States shall be amenable in damages when it mismanages as alleged the timber on those lands. It is too remote from the expectations of those who wrote that statute to indulge any such idea quite beyond the fact that the statute doesn't itself, provide for any expressed remedy as to breach --
Potter Stewart: When was the Tucker Act originally enacted?
Louis F. Claiborne: 1887, as well.
Potter Stewart: Same year?
Louis F. Claiborne: Same year. Well, that -- of course, the Tucker Act was a sequel to earlier legislation which had much the same effect in respect to the liability of the United States for cases found they've done an act of Congress. That had been the law since --
Potter Stewart: (Voice Overlap) the Tucker Act laws in the (Voice Overlap) --
Louis F. Claiborne: But not in this respect. The remedy for -- in respect of a claim founded on act of Congress had been in the jurisdiction of the Court of Claims since 1855.
Potter Stewart: Did the Tucker Act add or fund any expressed or implied contract to the United States?
Louis F. Claiborne: As -- it's certainly not --
Potter Stewart: (Inaudible)
Louis F. Claiborne: I think not. But I think it did add the Constitution. And I think it did also add the last clause -- the clause Your Honor, mentioned a minute ago. And it did in -- in other respects changed the procedure for collecting judgments which were previously not so much judgments as they were recommendations to Congress for an appropriation.
William H. Rehnquist: Mr. Claiborne, let me call your attention to the language from the General Allotment Act cited on page 3 of the Government's brief, the last sentence where it says, “And if any conveyance shall be made of the lands set apart and allotted as herein provided or any contract made touching the same, before the expiration of the time above mentioned, such conveyance or contract shall be absolutely null and void." Now, is that referring to a conveyance by the Government?
Louis F. Claiborne: I think probably both, Mr. Justice Rehnquist.
William H. Rehnquist: Well, don't you have an expression unius argument to rely on there that the -- that the remedy against the Government, if it breached its trust under the General Allotment Act, was simply to declare the conveyance null and void?
Louis F. Claiborne: I'm grateful to Your Honor. I don't know why we should have overlooked that argument, but does seem to me available to say that the statute itself provided its own remedy clearly not one in damages and that is an additional reason why one shouldn't strain and define here a different --
Byron R. White: Was not available in the Court of Claims?
Louis F. Claiborne: This remedy of course, would not be in the Court of Claims.
Byron R. White: And -- but if in the District Court, how about the -- how about restitution as when you declare that the act -- the -- a contract void? How about if it involved money?
Louis F. Claiborne: It may be that in the case of a -- an alienation which is wholly unauthorized --
Byron R. White: What about timber? The United States as would say a legally part of -- with Indian timber?
Louis F. Claiborne: Well, not the --
Byron R. White: And it's -- and it's a void contract and that the timber is gone and the U.S. has the money.
Louis F. Claiborne: In the --
Byron R. White: You get a (Inaudible) against the United States for money?
Louis F. Claiborne: Well, I think that would probably money wrongfully retained within the exception noted in Testan. It might also be a -- a taking within the just compensation clause. In both cases, it would be recoverable under the Tucker Act without regard to the reliance on act of Congress. If I may reserve the balance of my time for --
Byron R. White: And where do you get the -- and where do you get the -- the cause of action -- the implied cause of action -- the expressed cause of action as a constitutional claim?
Louis F. Claiborne: From the Constitution itself, but of course, the Tucker Act does imply.
Byron R. White: Mean that -- well, you don't read it in the Constitution.
Louis F. Claiborne: Well, this Court has done it, precisely that.
Byron R. White: Well, I know, but you -- you don't -- can you just find it there?
Louis F. Claiborne: Well, the just compensation clause --
Byron R. White: Yes.
Louis F. Claiborne: -- in words, it says that when the property of a private citizen is taken for public use --
Byron R. White: Oh, you say that's the only --
Louis F. Claiborne: (Voice Overlap) just compensation.
Byron R. White: -- that's -- that's the only clause in the Constitution for which there's a remedy against the United States?
Louis F. Claiborne: Remedy in damages, so far as I'm aware, against the United States.
Byron R. White: So -- so yes, your answer is, yes?
Louis F. Claiborne: Yes. (Inaudible)
Warren E. Burger: Very well. Mr. Hobbs.
Charles A. Hobbs: Mr. Chief Justice and may it please the Court. As a preliminary matter, I would like to call the Court's attention to the recent publication of the Whiskers case. The citation is 600 F.2d 1332. The Whiskers case was decided by Tenth Circuit and that Court agreed with the Court of Claims below. We sent a letter to the clerk of this Court asking him to pass the citation on to you. He said he had no authority to do that and for us to make this known to you at oral argument.
Potter Stewart: 600 F.2d 1332?
Charles A. Hobbs: Yes, Your Honor. I'd like to begin by expressing a little indignation to hear a justice claiming that this late date -- that it does not have -- the Court does not have jurisdiction over this case. When these claims were filed in 1971, the law of the land was at the Court of Claims did have jurisdiction over these claims. And that's what the Court of Claims initially held in the Klamath case, five years before we filed these claims and in the Fields case, a year and half before we filed these claims. In Capoeman, involving one of these very plaintiffs, six months before we filed these claims, the Court of Claims held it had jurisdiction under 1491.
William H. Rehnquist: When you say that you feel indignation Mr. Hobbs, isn't it the Government's responsibility to call to the court of any -- call the attention of any court of the United States an apparent lack of jurisdiction on its part?
Charles A. Hobbs: Yes, why did the Government wait so long to spot this apparent lack?
William H. Rehnquist: Well, that may be attributable to a number of reasons. But once they spotted it, it was certainly your obligation to call it to that attention of the Court.
Charles A. Hobbs: No doubt. We had gone through an enormous amount of litigation. Well past the time when ordinarily a litigant should raise a point of -- of jurisdiction, if he has one. We had had -- had six years of discovery. We had three fully briefed, reported decisions of the Court of Claims. We had 26,000 pages of exhibits developed and handed over to the Government. We had a three-week trial. After the trial is when the Government for the first time, raised the question of jurisdiction, up until that point, the law of the land was settled. That's why they didn't raise the issue in the Mason case. No one questioned jurisdiction at that late date.
William H. Rehnquist: But we've had jurisdictional questions raise sua sponte in this Court, as to the jurisdiction of District Courts, because that's the law.
Charles A. Hobbs: Justice Rehnquist, I'm not saying that this Court cannot entertain the question of jurisdiction. I'm only pointing out the enormous cost and inconvenience to us of having delayed so long while case after case, a total of I believe nine cases went by -- with jurisdiction being upheld in each one until finally they -- and though, in the wake of the Testan case, saw that there might be argument to be made in this case. And they raised it. We don't say they can't raise it. In the Mason case, it wasn't just the Court of Claims that helped give the bar the feeling that the law was settled, it was this Court. In the Mason case jurisdiction was invoked under 1491. It was not seriously challenged by the Government below. They did raise a question, but the Court of Claims held it had jurisdiction. The issue was not --
Potter Stewart: In the Mason case, the plaintiffs were not an Indian tribe?
Charles A. Hobbs: No. The plaintiff was an individual in the Mason case.
Potter Stewart: So, it didn't involve 1505. It involved 1491?
Charles A. Hobbs: Correct. This Court adjudicated the Mason case on the merits and it noted on Footnote 5 that the suit was brought under 28 U.S.C. 1491 which gives the Court jurisdiction and to render judgment upon claims against the United States and so forth. Now, this certainly tells me ordinary observer that well, here's a case that's been to the Supreme and they had no problem with it. And then in the text of the Mason case Mr. Justice Marshall wrote on page 398, “There is no doubt that the United States serves in fiduciary capacity with respect to these Indians. And that as such, it is duty-bound to exercise great care in administering its trust, duty-bound.” Now, at the time that the court below decided in our favor that there was jurisdiction under 1491 and 1505, 1491 of course is the Tucker Act. 1505 is the extension of the Indian Claims Commission Act, for future cases. I'm coming to the question of individual versus group claims. But at the time the court below decided our case, there were two parallel lines of cases in existence on the jurisdictional question. The Klamath and the Mason cases were one line. They define jurisdiction under 1491 and 1505 for Indian plaintiffs and the other line was the Testan case decided by this Court and the Eastport case decided by the Court of Claims in 1967. Eastport is the Court that wrote the fairly mandating compensation test which this Court adopted in the Testan case. And neither Testan nor Eastport of course, was an Indian case. The Klamath/Mason line of cases specifically upheld jurisdiction in cases like ours. And test port -- Eastport line was an open question in cases like ours, with the Department of Justice saying below that Testan/Eastport meant there was no jurisdiction even in an Indian case and we of course, arguing the contrary. The Court of Claims en banc with every single judge concurring, including I might add Justice or Judge Bennett, who had dissented in the Testan case and had been upheld by this Court. When it reversed the Testan case, all agreed that the Testan/Eastport line of cases was entirely in harmony with the Klamath/Mason line of cases and under both lines, the court had jurisdiction. Let's look at the Testan case now. Not -- first and foremost, Testan was not an Indian case, Indian cases are special as this Court has held time after time. There are special canons of construction that apply in Indian cases. There is the knowledge --
William J. Brennan, Jr.: Was this the position in the Court of Claim?
Charles A. Hobbs: It did not speak to that question.
William J. Brennan, Jr.: No. Thank you.
Charles A. Hobbs: There is the underlying knowledge that the land of the United States originally belonged to the Indians.
William J. Brennan, Jr.: Did your words have position than its support on the Court of Claims' jurisdiction in the Court of Claims?
Charles A. Hobbs: Yes, Your Honor.
William J. Brennan, Jr.: That is Indian cases are special cases?
Charles A. Hobbs: Yes.
William J. Brennan, Jr.: You do.
Charles A. Hobbs: And we argue the rule of construction which is --
William J. Brennan, Jr.: So I gather you feel like you -- you suggest that you can rely on that here even though the Court of Claims didn't justify its jurisdiction like I --
Charles A. Hobbs: Justice Brennan, I -- I assume that we can urge any ground that we urge below in support of affirmance of the Court of Claims. Of course, the --
William J. Brennan, Jr.: Even though the Court of Claims didn't rely on that ground. You urged it that they didn't -- they've relied on something else.
Charles A. Hobbs: Yes. It's of course, a rule for the convenience of the Court, whether to listen to such an argument if the Court of Claims did not address it. But it is a fact of the case that this is an Indian case. In the second place, also important is the fact that the Testan case did not involve a trust. It's instructive I think, to consider that kind of claim that Testan and Eastport involved. Testan involved the claim of a government employee that he was entitled to next higher rate and he should be paid for that. And he sued for damages for the pay -- back pay, for the next higher position which he said he should've had. The Eastport case involved someone who was disappointed with the ruling of the shipping board which failed to get him a license, to enable him to -- to sell a ship in foreign commerce, which he had wanted. Both of these cases involve governmental discretion and complex governmental decisions. Neither involves any indication by Congress that -- of any intention that there would be a right to recover damages with that kind of case. In our case, we have a specific trust relationship established by Congress in the General Allotment Act. And I would like to refresh ourselves on the language of that Act, the part that's relevant here. 25 U.S.C. 348 which was passed in 1887 says, “The United States does and will hold the land thus allotted for the period of 25 years in trust for the sole use and benefit of the Indian to whom such allotment shall have been made or in case of his decease, of his heirs, according to the laws of the state or territory where such land is located. And that at the expiration of such period, the United States will convey the same by patent to the said Indian or his heirs as aforesaid in fee, discharged of said trust and free of all of charges or encumbrances whatsoever.” In the Capoeman case this Court held that that language created a trust that had an important purpose of bringing the Indian to a state of competency.
William H. Rehnquist: It says nothing about damages or does it?
Charles A. Hobbs: The General Allotment Act?
William H. Rehnquist: Yes.
Charles A. Hobbs: No. Neither do most contracts, Your Honor. And yet it's implied when a duty imposed by contract has been breached, there's a duty to respond in damages. And we say the same applies in a breach of trust case.
William H. Rehnquist: What about the last language or the last sense quoted in the Government's brief where it says that, “If the Government makes a -- conveys in violation of the General Allotment Act, such contract shall be null and void.” Isn't there some argument to be gained for the Government there by saying that Congress specified the remedy as well as the right?
Charles A. Hobbs: I could not see when you were in dialogue with Government counsel. I could not see the existence of a remedy there, but these contracts for timber are in fact, authorized by statute. The 1910 statute specifically authorize the Secretary to make them, to sell the timber or to approve -- technically to approve the sale by the allottee. Therefore, this -- the 1910 Act certainly superseded the General Allotment Act's ban on any contract. But to pick up with the Capoeman case again, in that case you held that the language of the General Allotment Act created an undertaking to hold whole for the Indian his allotment. And that it could not be diminished by taxes during the trust period. And I would ask you, if you hold that the trust allotment cannot be diminished by taxes during the trust period, does it not follow that it should not be diminished by waste by the trustee during the trust period? The intent of Congress certainly had to be the same in both cases that would diminish the value of the allotment. And the Government has argued that the General Allotment Act did not contemplate a complex timber management operation. Perhaps it did not. We don't have to get into that because the only question here is whether there is jurisdiction and the cause of action for breach of trust. The scope of that trust whether it be broad or narrow, remains for further litigation.
William H. Rehnquist: But if the General Allotment Act contemplated only a skeletal type of trust to protect the Indians from the improvident conveyances and specified within it, its own remedy, then that would have a bearing on the outcome of this case.
Charles A. Hobbs: Well, it might. But the 1910 Act expanded the General Allotment Act by permitting timber sales. And that's what we have here, timber sales. We have congressionally authorized timber sales done under a trust arrangement created by the General Allotment Act.
William H. Rehnquist: Well, but then you're saying that it's the 1910 Act you're relying on, not the General Allotment Act because you say you don't have to get into the question of whether the General Allotment Act contemplated an elaborate timber management program.
Charles A. Hobbs: That's right. We do not have to get into that because the only question today is whether there is a cause of action for damages for breach of trust. It is not how wide or narrow the General Allotment Act trust is.
William H. Rehnquist: But then are you relying on the 1910 Act?
Charles A. Hobbs: I'm -- I'm citing the 1910 Act to you to show that when the question does come up of how wide the trust obligation is, the 1910 Act will help to find that. So indeed, will the 1934 Act, which instructs the Secretary to manage the timber on a sustained-yield basis, which he failed to do. There are many acts, all cited in our brief, which define the duties of the trustee under the trust relationship, but those Justice agrees with these.Justice says in its brief as we do, that this question is not before you now. The scope of the trust is not before you. If the General Allotment Act gave only one or imposed only one duty on the United States after litigation, we'd suppose we were to find that out, still the question is whether we could sue on the -- on the breach of that duty for damages. We say, sure we can for by analogy to the contract, by the legislative history which I'm going get to in minute.
William H. Rehnquist: What if the General Allotment Act had said in exactly the same words imposed a trust on the United States, then said, “The exclusive remedy for a breach of this duty by the United States, shall be an action for a rescission.”
Charles A. Hobbs: Perhaps, that would govern to the exclusion of an action for damages. You have also --
Byron R. White: Although, the last sentence of Section 5 refers just to conveyances and contracts. And any conveyance or contract with respect to these lands until the expiration of the allotment period under that sentence would be utterly void. Any contract or conveyance and yet -- yet there were subsequent acts as you say, which said expressly permitted certain kinds of conveyances and contracts with respect to these lands, as part of your argument, I take it.
Charles A. Hobbs: Yes.
Byron R. White: And in any event, it refers only to contracts and conveyances and part of your claims for breach of trust had nothing to do with the conveyance wherein -- or in --
Charles A. Hobbs: Well --
Byron R. White: -- a contract --
Charles A. Hobbs: -- they have to do with the way the conveyance of the timber was carried out.
Byron R. White: Well, I know, but the -- the failure to pay interest hasn't got anything to do with that does it?
Charles A. Hobbs: (Voice Overlap) --
Byron R. White: Or the failure to -- to handle it on sustained-yield basis? It hasn't got whole lot to do with the conveyance or a contract. Well, anyway you go ahead and start --
Charles A. Hobbs: The contract is the matrix in which these breaches of trust occurred. We don't rely on any breach of contract, certainly. We rely on breach of trust which occurred in the context of a contract. The contract I guess you might say is background. Another thing you have to consider is the very fact that these timbered allotments were made at all. Normally, in the overwhelming number of cases of Indian allotments, they're farmland. And the Indians are expected to raise corn or -- or cattle. In those cases, the Indian does the work and the Government just helps him and gives seed and supervises his labor. But when the Government gave 2400 Indians 80 acres of timber each, what are they going to do? You can't manage 80 acres of land. An individual Indian can't. For one thing, you only can harvest it once in a lifetime. And when you do, you're going to need equipment that most people don't have and especially an Indian. For another thing 80 acres is hopelessly small as a -- an area of timber that can be managed particularly if it's located in the middle of a large forest. If it were an isolated woodland, there are techniques for management of that. This is in the middle of a dense forest, one of the densest forests in the United States. The very allotment of those allotments -- the very act of making those allotments should have made clear that the trust was going to have to involve some management of timber, because the Indian could not possibly do that himself.
William H. Rehnquist: Are all of the respondents here allottees?
Charles A. Hobbs: They are allottees or successors of allottees, who have a claim that arose while the land was in trust status, yes.
William H. Rehnquist: So you don't have to rely on 1505 then?
Charles A. Hobbs: No. That's correct. However, we do rely on 1505 as a second string to our bow, a point I'm coming to. I want while I'm still on the question of what actually happened here? What is the -- for practical purposes, what really went on here? I also want to say this. That the Indians understandably took no part in the management of this forest even though they were the owners of it by the small parcel, they took no part in its management. The Secretary had a large office located, one of them in Portland, one of them in Washington DC and another one in later Everett, Washington. They decided when the timber was to be sold. When they decided that, they would go visit the Indian or communicate with him and have him come in and sign a power of attorney. That authorized the Secretary to do all things necessary to manage and sell that timber. The Government then would put out invitation for bids. The Government would let the contract. When the contract was let, the Government would supervise the contractor. It had inspectors in the field and inspected the logging. They saw to the proper scaling of the timber. They saw to the collection of money, security deposits from the loggers, they collected the money, they deducted their 10% fee and they credited the balance to the allottees. The -- all the allottee had to do after he signed the power of attorney was open the envelope with the check. That's all he had to do with a very complex management scheme involving hundreds of employees of the Interior department. This clearly distinguishes our case from the background of either Testan or Eastport. We don't say of course that the rules of those cases don't apply. They do of course. The Eastport/Testan rule says “That when you sue the Government for damages, you got to find outside the Tucker Act, some statute that gives you a right to sue for damages.” Justice says this has to be expressed. I think I heard during the oral argument a retreat from that. And it may as well be, because the Testan case -- when it comes to Testan's own conclusion, it picks up the Eastport conclusion, which is in our brief on page 13 which I would like quote for us. This is this Court laying down the rule, “Entitlement to money damages depends upon whether any federal statute, ‘can fairly be interpreted as mandating compensation by the Federal Government, for the damage sustained,' citing Eastport. In continuing, we are not ready to tamper with these established principles.” Well, the Eastport case that you approved of course was a rule laid down by the very court and including some of the very judges that have said that we, in our case, have jurisdiction. So the question is whether the language of the General Allotment Act which is to say a language establishing a trust can be fairly mandating as saying that you have a right of action for damages. The Court of Claims said, yes. The Whiskers case has said, yes. Two District Courts in California have said, yes. They're cited in our brief. You have said, yes, in case that we don't find substantially similar or dissimilar. In Jacobs v. United States, which is a just compensation case, you upheld jurisdiction under a Fifth Amendment taking claim even though the Constitution is silent as to any right to sue for damages. You've said this was part of the self-executing aspect of the Constitution. Well, isn't this also true of a trust? If a trustee breaches his trust, isn't it an inherent part of that relationship that he respond in damages? The United States v. Wickersham which was another government employee case. Unlike Testan, he already had his job and he was illegally fired from it. Yet, he was held to have an implied right to go to court and sue for damages for the back pay during the period he'd been laid off illegally, because you said that this was a suit for denial of emoluments of a civil service position and that was presumably an implied, fairly mandated cause of action.
Potter Stewart: I suppose the Bivens case and last term a Passman case also help you don't they?
Charles A. Hobbs: By holding implied rights of action in the Constitution?
Potter Stewart: Yes.
Charles A. Hobbs: Yes, they do. The Justice Department did not raise the point and we decided in view of the enormous number of points to raise, not to raise it ourselves. But we did think of that they helped us.
Potter Stewart: But you relied on the other case which held that the only jurisdiction was the Takings Clause of the Constitution.
Charles A. Hobbs: Well, the Jacobs case.
Potter Stewart: Yes.
Charles A. Hobbs: Yes, we did rely on that.
Potter Stewart: I noticed that the two cases are mentioned, other provisions of the Constitution were held to confer private rights of action.
Charles A. Hobbs: We also didn't argue the Cort case, C. O. R. T. because we thought our case was -- raise sharper issues. The Cort case was vaguer, less tied down, less nailed down, had less square corners in our case. We have a trust agreement here. And we think therefore, that the very existence of that trust confers a right of action for damages.Otherwise, what --
Potter Stewart: Because it's not a mine run, plain vanilla trust, is it?
Charles A. Hobbs: No. It is a trust to bringing in this to a state of (Voice Overlap) --
Potter Stewart: Distinction uses the word, trust, but it also provides that there shall be an allotment to individual Indians and it's the individual Indians who have control of the property unlike a mine run trust, where the trust -- where the trustee does.
Charles A. Hobbs: In the case of farmland, the Indian does have control of the property. In the case of timberland, he does not. These allottees don't even know where their lands are.
William H. Rehnquist: don't you think that the allottees could insist that they be permitted to operate their own timberland, if they so desired?
Charles A. Hobbs: They tried, Your Honor, in 1941. And the Court threw them out. That was the Eastman case. It was a suit for injunction to permit the Indians to run the timberland the way they wanted to and the Court said, “Why, nonsense.” The Secretary would be foolish if he let the Indians run their own allotments. It'd be -- it'd be a madhouse in the forest. And they threw them out of the grounds that the Secretary had to manage this forest as a single unit. They tried the injunction route and they were thrown out. Now --
William H. Rehnquist: That's a Ninth Circuit Case, that's not -- that's a -- a case in this Court is it?
Charles A. Hobbs: No, that's true. Now, justice agrees that some of our claims are within the Tucker Act. Claims for money improperly withheld. Why is land held by the Government with an obligation to turn it over at the end of the trust period any different than money held? If this Court here -- if the Court of Claims has jurisdiction for a money claim, then why not for a claim -- a land claim -- a land for return of the money originally given to the trustee? Contract, suppose there were a contract between these Indians and the Government and the obligation of the Government under that contract was to competently manage these forestlands, would anyone question that the Court of Claims had jurisdiction over such a claim? I don't think so. What about the fact that the Indians have paid fees in this case? The United States collects up to a 10% fee to pay it for its administrative services. Is that not an implied contract if the services are not properly performed to be paid to make the trust property hold? The Interior department agrees with us. Now, for a good reason, when the Indian Claims Commission Act was passed, they testified that they wanted to be accountable in order to make the government employees have an incentive to do a proper job under the trust's responsibility. They so testified and the language is quoted in our brief.
Byron R. White: Could I interrupt just a moment? Do you think technically, this a jurisdictional issue?
Charles A. Hobbs: (Voice Overlap) --
Byron R. White: By the way Government puts it -- they say the Court of Claims jurisdictional statute reads right on it. There's been a waiver of sovereign immunity in the Tucker Act. The question is this, one of statutory construction whether or not, the -- I at the threshold of the case, whether or not, the statute should be construed to permit a -- a cause of action for -- for damages.Suppose the statute said there was, I just said it in black and white. And suppose another said there shouldn't be. And another is a -- is a -- is more arguable, you at least have a -- you at least have a -- the Court of Claims got jurisdiction to figure out whether the statute grants a cause of action or not. And if they decide doesn't, the claimant just loses his case.
Charles A. Hobbs: That is so.
Byron R. White: Was that a jurisdictional question or not?
Charles A. Hobbs: I have to confess considerable confusion over the question of whatever sovereign immunity and creation of a cause of action --
Byron R. White: In sovereign immunity, the Government concedes has been waived by the Tucker Act.
Charles A. Hobbs: Well, that's not what this Court said in Testan.
Byron R. White: Well, I -- to Government, the -- well, I don't know. It so depends on how you read Testan about that.
Charles A. Hobbs: Well --
Byron R. White: And -- and the -- and I don't know that Testan is -- is any different in that regard, in the Government's argument here that the way that you construe whether the statute with respect to whether or not the cause of action has -- is -- has been granted. You should remember that you're talking about the scope of sovereign immunity. And I'm not sure that converts it into a -- a kind of a jurisdictional question that cant -- that -- that the Government -- that the -- that the normal rules about raising issues shouldn't apply to it.
Charles A. Hobbs: Your Honor, I have a second argument that is just as solid as the first. And I must turn my attention --
Byron R. White: Go ahead.
Charles A. Hobbs: -- to it now, and that is the legislative history. You cannot read this legislative history of 1505 without concluding that Congress intended tribes and identifiable groups to have a cause of action for damages for breach of trust. You cannot conclude otherwise. The question is whether our plaintiffs fit within the definition of tribe or identifiable group. Tribe, we have the Quinault Tribe and as to their 4000 acres, clearly they're within that. Whether you call it a waiver of sovereign immunity or creation of a cause of action, that legislative history did both and no question about that. As to identifiable group, these 1465 plaintiffs are an identifiable group. They were so held by the Court of Claims. While they were held to be a class by the Court of Claims, the Court of Claims, it has rulings that we think would make them agree that this is an identifiable group. If, however, you do not agree that they're an identifiable group, then the doctrine of in pari materia must lead you to conclude that 1491 has to be construed the same way as 1505. That is what the Court of Claims held in the Hiba case. It was cited in our brief and that is a case upon which we would rely, if we got to that point. Thank you.
Warren E. Burger: Mr. Claiborne, do you have something further?
Louis F. Claiborne: Very briefly, Mr. Chief Justice, I simply want to suggest that the proposition now put forward is a novel one. In one respect in this case, it seems to be a -- accolade of Indian cases, but we know from the Cherry case, decided by the same Court subsequently. That this notion, that there is immunability to damages for breach of trust is not limited to Indian cases. And indeed, why should it be here? There is such a principle, it will range far and wide and we invite the Court not to open that door which, if it's opened, has been opened since 1887 and yet, it didn't occur to anyone, Indian or not Indian to put it forward until at the earliest, a decade ago.
Warren E. Burger: Nothing -- nothing terribly unusable about that, is there? We recently construed the Sherman Act to include the type of cause of action that -- that's not been thought of by anybody since 1881 or 1887 or whenever the Act was passed.
Louis F. Claiborne: But Mr. Chief Justice, it happens, but it is unusual to discover 100 years later that the Tucker Act, if they're available, has and open to individual Indians, not tribes since then, has now, for the first time, provided a remedy of breach of trust because it happens, it might not have, that the allotment in this case was under the General Allotment Act, if it have been made under the very Treaty of Olympia involved in this case, it would not be a trust allotment, it would be a restricted allotment. And there'd be no technical breach of trust.
Warren E. Burger: Assuming a breach of trust on the theory that the case was brought, what kind of an action -- what kind of remedy would there be for a -- in terms of an accounting?
Louis F. Claiborne: Mr. Chief Justice, with -- of course, my first answer is that there is a prospective remedy to enjoin the continuation of the breach by the Secretary of the Bureau of Indian Affairs or whoever is violating the statutory duty to --
Warren E. Burger: Where would -- where would that be -- why would there be jurisdiction for that kind of action?
Louis F. Claiborne: In -- in the District Courts, under 5 U.S.C. 702, to review and to correct the action of the administrator in violating the statute whether it's called trust or not, is mismanagement of the forest in violation of -- of the statute. That remedy is plainly a veil of oath and certainly, is they, with the amendment of the Administrative Procedure Act. It may also be a remedy to recoup any monies wrongfully exacted or wrongfully retained from the Indian. That is an exception which the Court recognized in Testan and which we conceive here may well be available to these plaintiffs in respect of the claims that the administration fees charged by the Government were excessive. To that extent, it would be a wrongful retention or exaction which may be recouped. But it's not damages in the usual sense.
Potter Stewart: Would that be restitution?
Louis F. Claiborne: It would in effect, be restitution.
Warren E. Burger: At 1 o'clock, we'll hear -- we begin with Boeing Company against Van Gemert.