Court Opinion

ID: 9451259
Source: CourtListenerOpinion
Date Created: 2023-08-04 17:11:22.96663+00
Date Added: 2024-06-11T17:32:37.445341
License: Public Domain

On Petition for Rehearing
The United States has filed a petition for rehearing, raising two questions which were not discussed in the original briefs:
(1) That the district court and this court have no jurisdiction to entertain the defense of the State of Ohio against the penalties sought to be enforced in this case because the State did not exhaust administrative remedies to challenge the validity of acreage allotments.
(2) That a disputed question of fact exists as to whether the wheat harvested on state-owned farms has a substantial effect on interstate commerce, under the facts of this case, and that the case therefore should be remanded for the taking of proof on this issue.
I.
It is insisted that, as a prerequisite to asserting its defenses in this case, it was necessary for the State to have challenged the acreage allotments by seeking a review by a local review committee of three farmers as provided by 7 U.S.C. § 1363.6 Failure of the State to seek such a review, it is said, operated to strip the district court and this court of jurisdiction to pass upon the validity of such allotments.7
This court has held that a farmer must exhaust his statutory administrative remedies before he can challenge the accuracy of wheat acreage allotments as a defense to an action by the United States to collect civil penalties for overproduction. Corbin v. United States, 279 F.2d 431 (C.A. 6); Donaldson v. United States, 264 F.2d 804 (C.A. 6); Donaldson v. United States, 258 F.2d 591 (C.A. 6); Miller v. United States, 242 F.2d 392 *557(C.A. 6), cert. denied, 355 U.S. 833, 78 S.Ct. 48, 2 L.Ed.2d 44. Without lengthening this opinion by a detailed discussion of each case, we find all these decisions to be distinguishable on their facts from the present case.
For the reasons set forth in our original opinion, we hold that these statutes do not apply to the State of Ohio under the facts and circumstances of this case. The issue here is not the amount of the acreage allotments, but whether the State of Ohio is subject to the provisions of the Act under the facts here presented. Relying upon an opinion of the State Attorney-General rendered September 25, 1941 (See footnote 2, original opinion), the State of Ohio has taken the consistent position that the Agricultural Adjustment Act of 1938 does not regulate the amount of wheat produced on state-owned farms for use and consumption in State institutions, which under no circumstances could be marketed directly or indirectly in interstate or foreign commerce under the express prohibition of the State constitution. The present suit, filed by the United States, challenges the validity of this defense.
The institutional farms operated by the State of Ohio are located in different parts of the State. It would be an extremely cumbersome procedure, and quite obviously a useless one, to call upon three farmers in the same or nearby counties to pass upon the question of whether Congress intended for the statute to apply to state-owned farms in such a situation. The purpose of the administrative procedure prescribed by the statute is to ascertain the correct number of acres in an allotment, and not to require committees of farmers to make adjudications on issues of congressional intent.
This contention raised by the petition for rehearing would extend the doctrine of exhaustion of administrative remedies beyond the limits of practicality and common sense, and, we believe, beyond the Congressional purpose in enacting §§ 1363 and 1365 (footnotes 6 and 7).
We hold that the State was not required to resort to the statutory administrative procedure for testing marketing quotas as a prerequisite to interposing its defense under the facts of this case.
II.
In the district court the United States filed a motion for summary judgment, upon the ground that “there is no genuine issue as to any material fact.” The district court entered summary judgment on this motion. For the first time the United States now takes a position, on petition to rehear, that there is a genuine issue of material fact as to whether the wheat produced on state-owned farms and consumed for state purposes had a substantial effect on interstate commerce.
We conclude that there is no genuine issue of material fact in this case on this issue. We have held that under the constitution of Ohio this state-produced wheat was not “available” for marketing and did not “overhang” the market, and did not and could not move legally in interstate or foreign commerce. The same is true of all by-products of the wheat. The United States does not contend that any part of the wheat or its by-products in fact was marketed in violation of the State constitution. The sole argument is that, if Ohio did not grow its own wheat, it would be required to resort to the regular commercial markets for substitute supplies, thereby affecting interstate commerce. While there is general language supporting this argument in Wickard v. Filburn, 317 U.S. 111, 63 S.Ct. 82, 87 L.Ed. 122, a different factual situation was involved in that case. We adhere to the view expressed in our original opinion that these general expressions in Wickard v. Filburn are to be read in connection with the facts of that case and are not controlling under the facts of the present case; and that the amount of wheat that Ohio otherwise might have purchased necessarily would be conjectural.
The petition for rehearing is denied.

. “§ 1363. Review of quota; review committee
“Any farmer who is dissatisfied with his farm marketing quota may, within fifteen days after mailing to him of notice as provided in section 1362 of this title, have such quota reviewed by a local review committee composed of three farmers from the same or nearby counties appointed by the Secretary. Such committee shall not include any member of the local committee which determined the farm acreage allotment, the normal yield, or the farm marketing quota for such farm. Unless application for review is made within such period, the original determination of the farm marketing quota shall be final.”

. The United States also relies upon U.S.C. § 1367, which provides as follows:
“§ 1367. Stay of proceedings and exclusive jurisdiction
“The commencement of judicial proceedings under this part shall not, unless specifically ordered by the court, operate as a stay of the review committee’s determination. Notwithstanding any other provision of law, the jurisdiction conferred by this part to review the legal validity of a determination made by a review committee pursuant to this part shall be exclusive. No court of the United States or of any State shall have jurisdiction to pass upon the legal validity of any such determination except in a proceeding under this part.”