Court Opinion

ID: 9680121
Source: CourtListenerOpinion
Date Created: 2023-08-24 07:20:51.358066+00
Date Added: 2024-06-11T18:17:24.707320
License: Public Domain

STERN, District Judge
(dissenting).
While I agree with the result reached by the Court in Part II of its opinion, though for different reasons, I respectfully dissent from the opinion and judgment on the merits.
I
In my view the Court properly rejects the contention that it must stay its hand in this case. I write on this point only because of the Court’s analysis of the Younger-Huffman doctrine of federal non-intervention.
Defendants urge the Court to abstain from deciding this case on the basis of the doctrine of Younger v. Harris, 401 U.S. 37, 91 S.Ct. 746, 27 L.Ed.2d 669 (1971), and its companion cases, that federal courts should not interfere in ongoing state criminal proceedings. The Supreme Court extended the ambit of Younger to certain civil proceedings “in aid of and closely related to criminal statutes” in Huffman v. Pursue, Ltd., 420 U.S. 592, 604, 95 S.Ct. 1200, 1208, 43 L.Ed.2d 482 (1975). The Court has made clear, however, that such deference should not be afforded state administrative proceedings. Gibson v. Berryhill, 411 U.S. 564, 93 S.Ct. 1689, 36 L.Ed.2d 488 (1973); Huffman v. Pursue, Ltd., supra. In Huffman, Mr. Justice Rehnquist began his opinion for the Court with the following observation:
This case requires that we decide whether our decision in Younger v. Harris, 401 U.S. 37 [91 S.Ct. 746, 27 L.Ed.2d 669] (1971), bars a federal district court from intervening in a state civil proceeding such as this, when the proceeding is based on a state statute believed by the District Court to be unconstitutional. A similar issued was raised in Gibson v. Berryhill, 411 U.S. 564 [93 S.Ct. 1689, 36 L.Ed.2d 488] (1973), but we were not required to decide it because there the enjoined state proceedings were before a biased administrative panel which could not provide a necessary predicate for a Younger dismissal, that is “the opportunity to raise and have timely decided by a competent state tribunal the federal issues involved.” Id.
420 U.S. at 594, 95 S.Ct. at 1203 (emphasis added).
The State conceded at oral argument that the Board of Pharmacy could not have ruled itself unconstitutional, even if plaintiffs had requested relief from the Board before coming here. (Tr. 2/28/75: 9) Since the federal issue involved in this case is whether the composition of the Board of Pharmacy denies plaintiffs due process of law, the Board’s inability to rule itself unconstitutional necessarily disqualifies that body from the category of “competent state *1180tribunal” for Younger-Gibson-Huffman purposes. (See ante, at 1167, n. 13)
More important, there is no pending state proceeding of any kind to which this Court could conceivably defer. The Board of Pharmacy rendered its Decision and Order on December 5, 1974. Nothing now pends before any state tribunal, administrative or judicial. While it is true that plaintiffs could have chosen to challenge the Board’s Order in the Appellate Division of the New Jersey Superior Court instead of here, N.J. S.A. 45:14-12, no doctrine requires them to have elected a state rather than a federal forum to pursue federal claims. Had plaintiffs chosen such a course before bringing the instant suit, of course, this Court would have had to apply the Younger-Huffman tests to determine whether federal court deference was appropriate.
What these plaintiffs did, however, was to pursue their defense first in the administrative forum into which they were involuntarily drawn, and upon a final adverse administrative decision, to exercise their choice of judicial forum in which to seek vindication of their federally-guaranteed rights. Where a plaintiff has exhausted its state administrative remedies, “and now would only have recourse to review of the administrative decision in the courts of [the state],” the District Court need not stay its hand. Bowen v. Hackett, 361 F.Supp. 854, 860 (D.R.I.1973). As the Supreme Court held in Gibson:
Unlike those situations where a federal court merely abstains from decision on federal questions until the resolution of underlying or related state law issues15
—a subject we shall consider shortly in the context of the present case — Younger v. Harris contemplates the outright dismissal of the federal suit, and the presentation of all claims, both state and federal, to the state courts. Such a course naturally presupposes the opportunity to raise and have timely decided by a competent state tribunal the federal issues involved. Here the predicate for a Younger v. Harris dismissal was lacking, for the appellees alleged, and the District Court concluded, that the State Board of Optometry was incompetent by reason of bias to adjudicate the issues pending before it. If the District Court’s conclusion was correct in this regard, it was also correct that it need not defer to the Board. Nor, in these circumstances, would a different result be required simply because judicial review, de novo or otherwise, would be forthcoming at the conclusion of the administrative proceedings.16 Cf. Ward v. Village of Monroe-
[footnote 16 omitted]
ville, 409 U.S. 57 [93 S.Ct. 80, 34 L.Ed.2d 267] (1972).
411 U.S. at 577, 93 S.Ct. at 1697.
Once it is ascertained that no state proceeding is.pending, no doctrine of law or consideration of comity requires plaintiffs to choose a state court rather than a federal court in which to enforce federal rights. The majority reviews a growing body of law in the lower federal courts which suggests that the application of the Younger-Huffman rule rests on some “strong and peculiar relationship to, or interest in, the existing state proceedings” on the part of a state. Ante, at 1166. In finding this questionable addition to the Younger doctrine inapplicable to the facts of this case, though purporting to decline to decide whether the “strong state interest” approach is correct, the Court overlooks the fundamental fact which renders Younger-Huffman wholly inapplicable here: there is no pending state proceeding of any kind. Cf. In re Grand Jury Impaneled January 21, 1975, 541 F.2d 373 (3rd Cir. 1976). If we were to refuse to hear plaintiffs here, we would be sending them away to begin a new suit elsewhere.
In my view, the applicability of the equitable abstention doctrine does not depend upon such labels as civil, criminal, quasi-criminal or “in aid of and closely related to.” Nor do I believe that the Supreme Court would decide such an issue on the *1181basis of some generalized analysis of the “strength” of a state’s interest in the particular statute under challenge. The majority’s own caveat, ante, at 1171, that though it does not “suggest or intimate that New Jersey is unconcerned with the proper regulation of the practice of pharmacy,” the state’s concern is somehow not “strong” enough to warrant our deference, makes clear the deficiency of such an approach. A state is obviously “strongly” concerned, whatever that term may mean, whenever it has enacted legislation. That a state is “concerned,” in this sense, with the outcome of the litigation to which it is a party does not give it the right to compel that litigation to proceed only within its own courts.
It is my view, rather, that the basis of the Younger doctrine lies in the conception of “Our Federalism” enunciated by Mr. Justice Black in, that seminal case. 401 U.S. at 44-45, 91 S.Ct. 746. Younger and its progeny are an effort to reconcile the fundamental paradox of two parallel court systems exercising overlapping jurisdiction within the same time and space. The doctrine of equitable abstention is in reality a mere accommodation, designed to smooth the functioning of the judicial branches of both the national and state governments in a federal system. It demands that a federal court stay its hand only when a state court has already assumed jurisdiction over the controversy between the parties. I view the purpose of the doctrine to be the avoidance of needless embarrassment to the state courts from federal litigation which, by virtue of the Supremacy Clause, could cause federal courts effectively to divest state courts of jurisdiction over prior lawsuits.
In the absence of a pending lawsuit, however, I cannot see why a federal plaintiff should be denied a federal forum in which to contend that his federal rights have been violated by state action. Such, a conclusion implies no criticism of the state courts. On the contrary, there is no question that the state judiciary is as fully capable as the federal to apply the federal constitution to enactments of the state legislature. See, e. g., Stone v. Powell,-U.S.-,-n. 35, 96 S.Ct. 3037, 49 L.Ed.2d 1067 (1976). That alone, however, is no reason for federal courts to decline to exercise jurisdiction over federal questions once a plaintiff has elected to seek his relief here. In the absence of a pending state proceeding raising the same claim between the same litigants, we ought not to send him to the state courts merely because the state has an “interest” in the outcome of the litigation. Zwickler v. Koota, 389 U.S. 241, 248, 88 S.Ct. 391, 19 L.Ed.2d 444 (1967). Cf. Mitchum v. Foster, 407 U.S. 225, 92 S.Ct. 2151, 32 L.Ed.2d 705 (1972); Cottrell v. Virginia Electric & Power Co., 363 F.Supp. 692, 696 (E.D.Va.1973). A state has an interest whenever its statutes are challenged as violative of federal law. That interest, no matter how strong, does not give the state the right to have the issue decided in the forum of its choice.1
I agree with the majority that Pullman abstention is also inappropriate here. Ante, at 1168. Since I concur in the result of Part II of Judge Garth’s opinion, for the reasons just expressed, I move now to the merits.
II
I am not as sanguine as is the majority in concluding that the statute, on its face, does not deprive plaintiffs of their due process right to a fair tribunal. For the purposes of this case, however, I find it sufficient to confine myself to plaintiffs’ contention that the statutory scheme, as applied to them and to other chain pharmacies, is unconstitutional.
The majority and I diverge from the very outset. The Court states the issue as follows:
The main thrust of Rite Aid’s complaint is that it is constitutionally imper*1182missible for independent pharmacists to regulate chain store pharmacies in general and Rite Aid pharmacies in particular.
To succeed in this argument, Rite Aid must establish that the statute “as applied”, results in a violation of due process, in that the members of the Board have such a substantial pecuniary interest that they cannot be impartial or disinterested in the outcome of any proceeding involving Rite Aid or any other chain store.
Ante, at 1171.
The Court holds that plaintiffs have failed to carry that burden. I suggest that the Court has misstated the issue, and that plaintiffs have indeed sustained their burden of proving that the statutory structure is unconstitutional “as applied.”
The issue to be determined is whether the composition of the Board deprives plaintiffs of due process of law by depriving them of a fair tribunal. The majority fails to address this question directly. Instead it seeks to measure the “as applied” claim with the same yardstick it used to reject the “facial” contention: “substantial pecuniary interest.” In choosing this indirect mode of reasoning to an inductive conclusion, the Court gives short shrift to the substantial, direct testimonial evidence of actual prejudice against Rite Aid on the part of the Board and the class from which the members of the Board must be drawn.
In the “as applied” context the question of pecuniary interest, as determined by market factors, is relevant only as an indirect means to measure the existence or the absence of actual prejudice. The majority’s inquiry in this area might be significant in the absence of direct evidence of such prejudice. Even then, the appropriate market definition and requisite market share which the majority would require Rite Aid to prove are unclear. Here, however, plaintiffs have produced substantial direct evidence of prejudice against Rite Aid among the members of the Board, and more generally among the class from which such members must be selected. I would hold that plaintiffs have satisfied their burden of proof and are entitled to judgment. In my view the majority errs in relying upon Rite Aid’s failure to produce a market analysis to support its contrary conclusion.
Even if we could isolate the relevant market or markets, the issue before us would not be whether a theoretically reasonable member of the class of pharmacists from which the board members are selected, given Rite Aid’s percentage of the market, would be partial or impartial in passing upon matters involving plaintiffs. It may be “obvious” to the majority, as a matter of rationality and logic, “that if Rite Aid’s dollar volume is but a minute fraction of the total dollar volume generated by pharmacies,” ante, at 1171, the members of the board are unlikely to be prejudiced against such an unimportant competitor. The question is not, however, whether any board prejudice is rational or justified; the question is whether its exists.2 Indeed, the question is not even what Rite Aid’s market share and growth record are; the question is what the board members perceive them to be.3 Since the relevant inquiry must therefore be necessarily subjective, I turn *1183to the direct evidence bearing on the state of mind of the class from which the members of the Board of Pharmacy are required to be drawn.
There can be no dispute that Rite Aid’s growth in New Jersey has been meteoric. Rite Aid opened its first pharmacy in this state in 1966.
Since then, the number of Rite Aid pharmacies in New Jersey has increased to approximately thirty-seven. Five additional pharmacies are scheduled to open within the near future. With respect to the increased sales in New Jersey, Rite-Aid pharmacies filled in 1973 approximately 1,278,000 prescriptions which produced gross sales in the approximate amount of $4,000,000. In 1974 it is projected that Rite-Aid pharmacies in New Jersey filled approximately 2,000,-000 prescriptions and had gross sales in excess of $7,000,000.
Supp.Aff. of Strauss, ¶ 3.
By the time of trial these statistics were even more striking. From two pharmacies opened in 1966, Rite Aid’s presence in New Jersey had grown to 49 pharmacies by the first week of 1976. (Tr. 1/29/76: 13) From $4,000,000 in New Jersey prescription sales in 1973, Rite Aid jumped to nearly $9,500,000 by the end of 1975, (Tr. 1/29/76: 18) Rite Aid’s vice president, Timothy Noonan, testified without contradiction that this growth in dollar value of prescription sales was “faster than the national rate of growth in prescription business,” and suggested that this statistic demonstrated that at least part of Rite Aid’s growth was at the expense of existing pharmacies. (Tr. 1/29/76: 19; cf. Exhibit P-1)
Noonan also testified that Rite Aid advertises on radio and television and in newspapers throughout the State of New Jersey, using seven radio stations, ten television stations and forty-three newspapers. (Exhibit P-2) It was his testimony that the thrust of Rite Aid’s advertising was an effort “to present a discount image . particularly in . health and beauty aid and general sundry merchandise,” otherwise known as “front-end” merchandise. (Tr. 1/29/76: 7-8; Exhibit P-4) Noonan also noted that Rite Aid offers a 10% senior citizen discount on prescription items to patrons over 60 years of age, but that New Jersey law forbade the advertising of prescription prices. (Tr. 1/29/76: 9-10) Though Rite Aid could not advertise the fact, its prescription prices were 15-20% below those of the average independent pharmacy. (Tr. 1/29/76: 11)4 Noonan testified that Rite Aid had spent over $1,000,000 on advertising in 1975, and had budgeted $1,300,000 for advertising in 1976. (Tr. 1/29/76: 11-12)
It is apparent from the record that the “front-end” prices which Rite Aid did advertise appeared in newspapers read even in communities in which Rite Aid presently maintains no pharmacy, by patrons of pharmacies which do not presently compete directly against any Rite Aid outlet. Moreover, as the deposition testimony demonstrates, Rite Aid’s growth from two to forty-nine pharmacies is an event which did not go unnoticed by small independent *1184pharmacists throughout the State, regardless of whether those pharmacists were in direct competition with a nearby Rite Aid pharmacy at any particular time.
In this regard a significant portion of Noonan’s testimony, as it relates to the board members’ perception of Rite Aid, concerns Rite Aid’s full-time realty department. It was Noonan’s testimony that Rite Aid employs full-time realtors who “are constantly looking for new locations.” (Tr. 1/29/76: 23) In addition, Rite Aid uses brokers to alert its real estate staff to likely new locations for pharmacies. Through the use of these procedures, Rite Aid has grown so swiftly that by the morning of trial, there were two more Rite Aid pharmacies than there had been two weeks earlier when P-1 was prepared, for a total of fifty-one with four more applications in various stages of processing. (Tr. 1/29/76: 24)
Rite Aid’s substantial presence in New Jersey, however, is not even a major portion of the total wherewithal of this formidable organization. Rite Aid operates more than 360 pharmacies nationally and grosses nearly half a billion dollars annually. As the record amply demonstrates, whatever Rite Aid’s present percentage of the entire New Jersey market may be, or any sub-market, it is infinitely greater than that of any one independent pharmacist. It is also clear from the record that Rite Aid has the capacity to become a direct competitor of any New Jersey pharmacy whenever it chooses, simply by opening yet another new pharmacy-
The depositions of members of the board reveal their acute awareness of these facts of business life in the New Jersey pharmacy industry. Defendant Sussman admitted in his deposition that he knew that Rite Aid’s prices for prescription and other products were lower than those of individually-owned pharmacies (Tr. 1/29/76: 28), and that he recognized the possibility that Rite Aid’s price policy could tend to dilute the business of individually-owned pharmacies. (Tr. 1/29/76: 29)
Defendant Campbell’s deposition reveals that he knew that Rite Aid pharmacies “are so-called discount operations.” (Tr. 1/29/76: 80) He testified that the term “discount” meant to him that “they sell for less than the suggested retail, but this is not uncommon.” Id. He added: “I suspect that [my prices] [a]re higher [than Rite Aid’s].” Id.
The following colloquy between defendant Campbell and counsel for plaintiff at the Campbell deposition illustrates the defect I perceive in the statutory scheme as applied to Rite Aid and other chains:
Q: . . . But in the event that a Rite Aid Pharmacy were to seek permission to open a pharmacy in your geographical area you would consider that, would you not, to be a factor which would have an affect upon your business judgment?
[Objection and discussion by counsel omitted]
A: Succinctly, yes, if I thought Rite Aid or heard Rite Aid was going to open a pharmacy next door or across the street I’d be concerned, of course, as anyone else would.
Q: Why would you be concerned about Rite Aid?
A: As I would with anyone else. I feel you can slice a pie just so many times.
Q: What do you mean slice a pie so many times?
A: There’s a given market in an area and, as I say, you can cut it just so many times. And if when any new operation, any new practitioner, came into the area he would have to succeed, if he succeeded, at the expense of those already there.
Q: Okay. Now, would you be concerned or fear a new Rite Aid Pharmacy more than an independently-owned pharmacy?
A: Yes, I would.
Q: Why?
A: Well, it’s a large corporate structure so they can afford, so to speak, to hang in there — hang in there for a longer period of time.
*1185Q: What do you mean hang in there?
A: Well, when you open a new pharmacy it’s seldom profitable the first few months. And you have to have — it requires capital to “hang in there.”
(Dep. of Campbell, at 81-82)
Rite Aid’s failure to prove by market data that it presently dominates the entire pharmacy industry in every local community throughout the State is immaterial to the proven perception of Rite Aid as an impending, if not immediate, threat to any small pharmacist.
Defendant Campbell further testified that the Board members are aware of a general feeling of antipathy toward chain pharmacies among the members of the New Jersey pharmacy profession (Tr. 1/29/76: 86-99), and that some concern had been expressed to him with regard to Rite Aid’s rapid growth:
Q: Have any owners of individual pharmacies such as your own discussed with you the growth of Rite Aid Pharmacies in New Jersey?
A: I can’t recall specifically.
Q: Well, has the subject ever come up at any time that you can recall?
A: I have heard it.
Q: What have you heard?
A: That they’re expanding probably at association meetings.
Q: How about generally, Mr. Campbell, have you ever discussed or has anybody ever discussed Rite Aid Pharmacies with you?
A: I’m sure they have.
Q: Tell me generally what was said.
A: It’s been months or years ago and I can’t really remember, they were expanding and buying stores in New Jersey, they were opening new stores.
Q: Was it a concern of these individuals that Rite Aid was opening new stores in New Jersey, a concern that it might affect their business?
A: I honestly can’t recall. It was more “Wow, they’re really moving” or something like that. I can’t recall specific times or if there were numerous times or maybe once or twice.
(Dep. of Campbell, at 82-83)
The constitutional infirmity of the present regulatory system is highlighted by the following testimony by defendant Campbell.
Q: And how do you become aware of this feeling of antipathy?
A: Well, we’re — we’re members of the Board of Pharmacy but we — that occupies only a small part of our time. We’re all engaged in operating our own pharmacies and we see and talk to other pharmacies, other pharmacy owners.
(Dep. of Campbell, at 88-89) (emphasis added)
Q: . . . This antichain feeling and sentiment that has been expressed for the past twenty-five years, the basis of that feeling is essentially that the chain prevents the individual from making as much money as he wants to make. Isn’t that right?
A: Yes, insofar as it goes.
Q: It boils down to how much money you’re going to make, doesn’t it, Mr. Campbell?
A: (The witness nods his head in the affirmative).
Q: You have to answer “yes.”
A: Yes. Excuse me.
Q: And just as you’re aware of this economic interest, so too are the other members of the Board?
A: Yes, any practicing pharmacist is aware of it.
Q: Aware of that?
A: His economic interest. It’s not just competition. There are a lot of economic interests. .
(Dep. of Campbell, at 93) (emphasis added)
The State conceded the credibility of the Campbell deposition, and stated that it dis*1186puted none of his deposition testimony. (Tr. 1/29/76: 147)
Defendant Silnutzer testified at his deposition in a similar vein, though more guardedly:
Q. Did you ever discuss with any of your fellow board members the growth of the Rite Aid Pharmacies within the State of New Jersey?
A. Not that I recall.
Q. Did you ever discuss it with any pharmacy — any pharmacies?
A. I guess I might have.
Q. Do you recall what you would have discussed?
A. No. Generally the fact that Rite Aid was growing. I recall having talked about their stock market situation. I guess the same thing that a layman would talk about, about the growth of Rite Aid.
Q. Was the growth of Rite Aid of any particular concern to you?
A. No.
Q. Did the subject of Rite Aid’s growth or method of doing business ever come up during the course of any board meetings?
A. Not that I can remember.
Q. Did the subject of chain store pharmacists ever come up during the course of any board meetings or outside board meetings, for that matter? MR. LA BUE: Can we define chain store in terms of number?
Q. Do you know — do you understand what I mean by a chain store, Mr. Silnutzer?
A. Yes.
Q. Did that subject ever come up at any board meeting?
A. Not that I can recollect.
Q. How about outside the board meetings?
A. Yeah. I think- — well, you can pick up any trade journal and read about chain stores as differentiated from independents.
Q. That would have been discussed amongst the board members, wouldn’t it?
A. Well, except between meetings I rarely spoke to or saw other board members. I can tell you I saw other pharmacists and that it was a topic of discussion.
Q. What would you have discussed with other pharmacists?
A. What would I have discussed?
Q. Yes, about chain stores.
A. I guess growth. Maybe the way they’re differentiated from the average independent, and the way they do business. I think that rather covers it.
Q. The chain stores growth and method of doing business would be of concern to the independent pharmacy owner, would it not?
A. It is to some, not to me particularly.
Q. Why would it be of interest to some?
A. Well, many independents feel that chain stores are highly competitive and may put them out of business in their own particular areas.
Q. And that sentiment has been expressed to you by some independent owners of pharmacies, has it not.
A. By many.
Q. A lot?
A. The Trade Press, they usually compare—
Q. You said the press would pretty much express the fear, I think you said. And you were going to say something else and you were interrupted by the Reporter.
A. Yeah. I think the Trade Press — I’ll differentiate — I think has expressed the fear that pharmacists have expressed, that the chain stores will take over the drug business and they’ll be — I think small pharmacists particularly have the fear that chain stores are going to put them out of business.
Q. This fear, putting the independent out of business, that’s been expressed *1187to you, would you say on many occasions?
A. No. I don’t think this topic is a topic that occurs among professionals any more than any other topics.
Q. But the number of persons who have expressed this fear to you, would you say there have been many persons, a few persons, somewhere in between?
A. I can’t tell you that anybody has personally to me said “I’m going to go out of business,” you know, but I think they reflect the view of a lot of people put together, that they’re competing with these people.
Q. It’s a fear on their part?
A. Yeah. Except, you know, I don’t know how many — like myself, I’m aware there’s this fear on the part of pharmacists, independent pharmacists. I don’t have that fear myself.
Q. But the others do?
A. Yeah.
Q. Whether rightfully or wrongfully, they have this fear?
A. Well, maybe they do. You know, from what I know — from what I hear and what I read in the press, they do.
Q. Has this fear of competition between the independents and the chain store pharmacy been expressed at any pharmacy association meetings?
A. Not that I can recall in particular.
Q. Have any of your fellow board members expressed this fear of competition?
A. No.
Q. You don’t recall?
A. (The witness shakes his head in the negative.)
Q. You have to answer “no.”
A. Oh, no. .
Q. Okay. You say that the Trade Press has echoed the fear of chain store pharmacies — the fear of independents toward the chain store pharmacies. Is that correct?
A. I think that’s pretty correct.
Q. Are you referring to any specific trade publication which expresses that fear?
A. No.
Q. Is there any particular magazine that you’re referring to or—
A. No. I think any date of any issue you can find it in any of the trade journals.
Q. And I take it that at the time you were a board member that you were aware of this fear of competition on the part of independents toward the chain stores?
A. And before and since.
(Dep. of Silnutzer, at 31-36) (emphasis added)
Silnutzer isolated yet another defect from which the Board suffers, not only because it has a competitive interest in the business of those it regulates, but also because it knows it has. Because he was aware of the competitive antagonism between independents like himself and chain stores like Rite Aid, Silnutzer testified, he deliberately “bent over backwards” to schedule fewer enforcement inspections of Rite Aid than of independents, and to impose lesser penalties on Rite Aid than on independents:
Q. Why did you think that by increasing the penalty you might be accused of signaling Rite Aid out if you had not been previously accused of that?
A. Well, I guess there were some thoughts I had. You know, almost subliminal, but they were there. Part of it was what we talked about, the fact that pharmacists, independent pharmacists, are believed to be in fear of chains—
Q. That was in your mind?
A. That’s always in my mind. In the early years, when I first came to the board, board inspections were carried out by members with relation to the granting of permits or transfer of permits, or anything else. I guess I didn’t do it with independents and say I’ve been to this kind of guy, so I wouldn’t go into that store or I’ve seen this kind of opera*1188tion so I wouldn’t go into that one. But I took special care that I didn’t— I guess I didn’t inspect as many Rite Aids proportionately or chains generally as independents, because, you know, I had — I had the feeling even at that time that we might be accused of picking on these people. My feeling is that in the minds of the chain — I’m not connected with chains, I’m concerned more with the independent, and they read the press too, they probably feel if the independent fears them that I fear them. I don’t. But I had the feeling that they might point a finger at me and accuse me of feeling that way and behaving that way because of this feeling. So I took pains not to do too many inspections of chain stores generally.
(Dep. of Silnutzer, 12/1/75, 40-41)
And on cross-examination by the Deputy Attorney General:
Q. The 90-day period of suspension then in your opinion, was that a lesser or a greater penalty than had been imposed on independents for similar violations?
MR. RICCIO: Objection.
MR. DIZZIA: Your objection is noted.
Q. Can you answer that question, Mr. Silnutzer?
A. Yes. I thought it was rather lenient as compared to other penalties that we had imposed.
Q. Is there a reason why it was more lenient than those other penalties?
A. I think I expressed it. I guess you want me to express it again.
Q. If you would.
A. Yeah. I guess, and again I can speak only for myself, not for the rest of the board, but in my mind I didn’t want to be accused of going out of my way to pick on Rite Aid or to impose any harsh kind of penalties. And I wanted to be very certain not to make the penalties any stricter than the penalties we had imposed against anybody else. I think maybe in bending over to do that I would rather have it the other way. I would rather be more lenient with Rite Aid.
Q. You bent over backwards to be lenient to Rite Aid?
MR. RICCIO: Objection.
A. Um-hum.
(Dep. of Silnutzer, 12/1/75, 51-52) (emphasis added)
I view that sort of regulation as a disservice to the public, the pharmacy industry and the individual litigant before the board. To me it matters not if the awareness of a competitive interest influences the judge for rather than against the litigant before him. In either event the adjudicative process is poisoned.
Regardless of defendant Silnutzer’s professed approach to the regulation of Rite Aid, however, there is one crucial fact in the record which in my view demonstrates the error of the majority’s decision: the Board’s “freeze” of all Rite Aid applications because of the pendency of disciplinary litigation against one Rite Aid store, Rite Aid of Bergenfield.
Rite Aid Corporation is a public corporation, listed on the New York Stock Exchange, with approximately 6,000 shareholders. It operates 360 pharmacies and an additional 100 non-pharmacy stores in 12 states. Its most recent total gross sales were approximately $400,000,000, generating an annual pre-tax profit of $20,000,000. (Tr. 1/29/76: 58-60)
Franklin Brown, Vice President and General Counsel for Rite Aid Corporation, testified that the Board refused to consider further Rite Aid applications for pharmacy permits, or to act on pending applications, for a period ranging from December 1973 to July 1974. Plaintiffs introduced into evidence a letter dated January 31, 1974 (P-4) from defendant Paul Pumpian, Secretary of the Board, to Louis E. Lehrman, President of Rite Aid Corporation. The letter substantiates plaintiffs’ allegation that the Board imposed a “freeze” on Rite Aid applications:
*1189Dear Mr. Lehrman:
Reference is made to the application filed by Rite Aid Pharmacy of Wildwood, Inc. for a permit to conduct a pharmacy at 3306 Pacific Avenue, Wildwood, and to advise that the Board has not approved the application.
The Board plans to hold a hearing on this application under Section 45:14-33 [illegible] of the Pharmacy Act which states, in part “Upon application made on a form prescribed and furnished to the Board, and upon payment of the required fee, the board shall issue a permit to conduct a pharmacy to such persons as it shall deem qualified to conduct such business.” Because of the reports of numerous violations by Rite Aid now before the Board, the Board has deemed it necessary to hold a hearing on the Wildwood application to determine if your corporation can still be considered as “qualified to conduct” a pharmacy.

The hearing on this application, however, will not be scheduled until action on the reported violations has been taken.

(emphasis added)
In response to this letter, according to Brown’s testimony, Brown telephoned Pumpian in early Febraury, 1974. He had previously called Pumpian in mid-January “to follow up” on the Wildwood application. Brown testified that Rite Aid was “anxious to get this particular permit because at that time a pharmacy in our neighborhood was closing and we wanted to transfer as much of that business to our store as we could. So I was moving the permit along as best I could.” (Tr. 1/29/76: 54) Brown continued:
When I telephoned Mr. Pumpian in mid-January, he advised me that we were not going to get this license following the inspection. He placed no emphasis at all on the idea that we might have failed in the inspection and he did not indicate that.
He said, rather, that we would not receive any license at Wildwood or elsewhere until we had gotten a final resolution of an alleged series of violations in our Bergenfield store. Mr. Pumpian told me that he was sending a letter to that effect to Mr. Lehrman, that upon receipt of that letter I could be in touch with him.
Then when the letter arrived a few days later, I telephoned Mr. Pumpian and forcefully objected to what I termed to him an unlawful refusal on the part of the Board of Pharmacy to process our application in Wildwood. And Mr. Pumpian told me not only would it be Wild-wood, but we would not receive any licenses for any new pharmacies in New Jersey until the dispute in Bergenfield was cleared up.
Q Now, following those two telephone conversations with Mr. Pumpian and the letter that Mr. Lehrman received, what did you do?
A I did two things. I urged Mr. Pumpian to have the Board reconsider this action on their part, this refusal of any licensing, and I contacted my counsel in Newark, Donald Robinson, and Mr. Robinson and I pursued contacts with the Deputy Attorney General, Mr. LaBue, who was attached to the Pharmacy Board or who does some of their work, and we appealed also to Mr. DelTufo, the First Assistant Attorney General.
Q Stopping there, you are familiar with the stipulation concerning your conversations and your meeting with Mr. DelTufo, are you not?
A I am.
Q Now, following your meeting with Mr. DelTufo and his reference to you, as stipulated, to Mr. LaBue, Deputy Attorney General in Newark, what, if anything, did you do concerning new store applications and when did you do it?
A Well, we continued conversations with Mr. LaBue repeatedly for a few months, attempting to persuade him to advise the Pharmacy Board to allow us to have applications processed. Finally, it seems to me that it was some time in late May, 1974, Mr. LaBue indicated offhandedly that maybe it was time for us to file *1190an application and pursue such an application and that the first one should really be a re-application or a request for a hearing on the Wildwood application which had been filed five or six months earlier.
Q Did you do that?
A Yes, we did.
Q And did you then process additional applications?
A Yes. We processed several other applications at about the same time, because we had six or seven pending that we had wanted to open and had been delayed during that period of five or six months.
We were granted a hearing on the Wildwood matter and it was a brief hearing and the Board immediately following the hearing granted us a license in the Wildwood application, but that was in late June — to be specific, early July, 1974.
Q Was there a period of time during which Rite Aid did not receive any new store permits for New Jersey pharmacies?
A Yes. That period ran from December, ’73 to July, ’74.
Q And was there also a period of time when Rite Aid Corporation did not apply for any new store applications with one exception?
A Yes.
Q And what was that period of time?
A We did not make any application from February, the beginning of February, ’74, to say May, ’74.
Q Why?
A Because Mr. Pumpian told me that this would be a futile act.
Q Was that the period of time during which you had your meetings with Mr. DelTufo and Mr. LaBue?
A Yes.
Q On the Deputy Attorney General level?
A Yes. That is the period.
Q Now, did you apply for one new store application during that period?
A Yes.
Q Which one and why?
A Passaic. We applied for one — we applied for a license in Passaic in May, 1974, because it was a condition of our lease that we apply for a license for a pharmacy because our landlord was a supermarket and our landlord demanded that we be a pharmacy and not just a health and beauty aid store, and the lease said that we could open as soon as we applied for the license.
So, though I knew that it might be a futile act to apply at that time, I applied to comply with the literal requirements of the lease in Passaic.
Tr. 1/29/76: 54-58.
Defendant Pumpian testified on defendant’s case. He stated that the Bergenfield investigation began when he received a letter of complaint against Rite Aid from a pharmacist in the Bergenfield area, alleging that a local physician had posted a notice in his office advising his patients not to use the Rite Aid Pharmacy in Bergenfield. Pumpian sent the pharmacists’s complaint to the Enforcement Bureau with a request to investigate. (Tr. 1/29/76: 195-196) The local pharmacist’s complaint was dated April 6, 1973, and Pumpian’s memorandum requesting an investigation was dated April 13, 1973. (Tr. 1/29/76: 201; Stipulation of Facts, Tab A-l) Reports of that investigation were forwarded to the Board on August 22, 1973. The Board set the matter for a formal hearing. (Tr. 1/29/76: 202)
Pumpian testified that at a Board meeting on January 23,1974, the Board “agreed that no action should be taken on the Wild-wood application until a decision on the violations of the Pharmacy Act by Rite Aid, referring to the Bergenfield situation, were [sic] resolved.” (Tr. 1/29/76: 203) After a five-month delay, however, the Board granted a hearing on the Wildwood application despite the fact that the Bergenfield complaints had still not been resolved. The Wildwood hearing was held on June 24, 1974, and the Wildwood application was approved by the Board that same day. (Tr. 1/29/76: 207-208) This reversal of position was, according to Pumpian, the result of a *1191legal opinion from a Deputy Attorney General. Pumpian testified:
We were advised that the Bergenfield store — the applicant for the Bergenfield store is Rite Aid of Bergenfield. The applicant for the Wildwood store is, I think, Rite Aid of Wildwood. That there is a different — a separate corporate entity and, therefore, the only matter that could be considered on the Wildwood application were [sic] matters relating to the Wildwood store, the Wildwood corporation.
Because of this no other pending Rite Aid matters were considered on the Wild-wood application because of the separate corporate veil, if you wish.
Tr. 1/29/76: 212-213.
Pumpian testified that “the numerous violations by Rite Aid” cited in P-4 were in fact “fifteen or twenty” complaints received against Rite Aid by January, 1974. About half these complaints had been made by pharmacists. (Tr. 1/29/76: 209-210) It was Pumpian’s testimony that he received such complaints against Rite Aid from pharmacists whenever Rite Aid opened a new pharmacy near them. (Tr. 1/29/76: 258-259)
The prejudice of the board against Rite Aid is manifest in this testimony. Based on fifteen or twenty complaints over a period of more than seven years of operations in New Jersey, most if not all from competitors, when Rite Aid was operating at least 27 pharmacies in New Jersey and hundreds out-of-state, the board froze all action on pending applications and barred future applications for new facilities from this New York Stock Exchange corporation indefinitely, on the purported basis that Rite Aid’s qualifications to conduct any pharmacy anywhere were in doubt. The specific impetus for this action, we are told, was a complaint by yet another local competitor, this time of Rite Aid’s Bergenfield pharmacy.
Only after months of freezing any further Rite Aid expansion did the board relent and rescind the ban, on the technical basis that it had been wrong to consider against Rite Aid of Wildwood complaints filed against Rite Aid of Bergenfield, in view of their separate corporate identities. Thus the board attempted to insulate itself from allegations of prejudice while effectively barring further Rite Aid expansion in this state for five months.
The record before us demonstrates the strategy used by the members of the board. Rite Aid’s inevitable growth in New Jersey was to be delayed. The freeze on old and new applications and the increase in penalties beyond the recommendation of the hearing officer were part of that effort. The facts of Rite Aid’s growth and structure, well-known to the board members, made clear to them that if today’s application to conduct a pharmacy were not for a site across the street from a member’s own pharmacy, tomorrow’s might well be.
The testimony of the members- of the board at depositions, when combined with the evidence of the board’s actual conduct against Rite Aid, amply supports plaintiffs’ allegations of “as applied” unconstitutionality. It is evident from the facts adduced that the members of the board were well-aware of Rite Aid’s extraordinary growth record, both within and without the state. The Board knew that Rite Aid’s successful operations in many states supplied a ready “deep pocket” to subsidize cut-rate prescription pricing in New Jersey. I have no doubt, based on this record, that the members of the Board were aware of Rite Aid’s low-price policy, of its full-time realty staff seeking continued expansion and of the growing role of this and other chains in the New Jersey pharmacy market. (Stipulation of Facts, Tab A, at 7-8) Under these circumstances, the Court’s observation in Wall is well-stated:
If the board’s argument regarding geographical location were accepted, the board could challenge the licenses of all the optometrists in the state simply by disqualifying the member from Atlanta in all Atlanta cases; disqualifying the member from Tifton in all Tifton cases, etc. In this way, the board could — and does — argue that it has removed the fi*1192nancial interest in the case geographically, while assuring through this “round-robin” procedure that essentially the same board decided all the cases. In other words, the possibility for “log-rolling” or mutual “backscratching” is enormous.
379 F.Supp. at 189 (emphasis added).
Thus, the majority’s suggestion that if a given member of the board were a direct competitor of Rite Aid, “[t]he proper procedure . . . would be to seek the disqualification of the interested Board members,” ante at 1174, n. 25, is, as the Court held in Wall, “simply . . not good enough.” (379 F.Supp. at 189) Its deficiency lies not only in the possibility that a pharmacist-board member from Cape May may strike back at a Rite Aid outlet in Cape May by penalizing a Rite Aid outlet in Bergenfield. The most pernicious aspect of the statutory scheme rather, is that a pharmacist-board member in Sussex, where there may be no Rite Aid competitor, may find it prudent to win the Battle for Sussex, on a street-corner in Bergenfield; indeed, if Rite Aid can be stopped or delayed in Bergenfield, the Battle for Sussex may never need to be fought at all.
The majority fears a parade of horrors from the result I would reach here. Ante, at 1170, n. 19. It was suggested by my brothers at oral argument that the views I set forth here would spell the end of “self-regulation” of the professions, e. g., Tr. 1/29/76: 92-93, or would prevent the State from regulating the professions through technically competent officials, ante, at 1170, n. 19.
In my view these fears are groundless. What is before us now is not a system of professional “self-regulation.” This is state regulation. We deal here not with some informal professional board which renders advisory opinions and relies merely on the force of moral suasion to enforce them. On the contrary, this board is constituted by statute and vested with the formidable police power of the State. Though its members are practicing pharmacists, they are public officials. The vice of the present system is that these public officials are required, by the very statute which grants them the power to regulate, to continue their active role in the class to be regulated. The power exercised by this board is the power of the State, and it is the power of the State that is circumscribed by the Due Process Clause of the Fourteenth Amendment.
As for the feared threat to regulation by persons skilled in the field, the permissible alternatives to a system which requires the board members to continue the active conduct of a pharmacy during their tenure are many. The State may employ qualified pharmacists to sit as members of the Board of Pharmacy full-time, provided that they not practice during their term of office. It could choose to compensate them for their services as it compensates Mr. Pumpian, a full-time state employee. The legislature might prefer instead to recruit volunteers from the faculties of pharmacy schools or the ranks of the recently-retired. There may well be other regulatory structures which would guarantee effective professional regulation within the restrictions imposed by the Constitution. In these ways the State could achieve its rational and laudable goal of competent professional regulation without depriving the regulated of their constitutional rights.
Ill
On this record, I would hold that the statutory scheme requiring the board to be composed principally of active practicing pharmacists, as applied to these plaintiffs, deprives them of their due process right of a fair tribunal.
For the foregoing reasons, I respectfully dissent.5

 See, e. g., Railroad Comm’n v. Pullman Co., supra; England v. Louisiana State Bd. of Medical Exam’rs, 375 U.S. 411 [84 S.Ct. 461, 11 L.Ed.2d 440] (1964); Lake Carriers’ Assn, v. MacMullan, 406 U.S. 498 [92 S.Ct. 1749, 32 L.Ed.2d 257] (1972).

. In the largest sense, the State’s argument turns comity on its head. Why should the State be concerned whether this litigation proceeds here or elsewhere? If the courts of both sovereignties are equally competent to vindicate federal rights, are they not equally competent to vindicate state interests as well? In the absence of a pending state lawsuit, what “interest” does the State have in plaintiffs’ choice of forum?

. I emphasize that the prejudice against Rite Aid which I find among the members of the board inheres in each independent pharmacist-member by virtue of his dual role as independent pharmacist and state-invested regulator. It is not some personal ill will which he may bear for reasons and from origins peculiar to him. That type of prejudice, which the majority calls “actual bias” in Part IV of its opinion, is not properly before this three-judge Court.
I note also that the recent repeal of 28 U.S.C. §§ 2281 and 2282 by Pub.L.No. 94-381, effective August 12, 1976, is of course inapplicable to actions commenced before the date of enactment. Pub.L.No. 94-381, § 7 (Aug. 12, 1976).

. Even under the majority’s approach, there is ample evidence in the record to suggest that Rite Aid was and is a significant force in the industry. For example, the parties have stipulated that Rite Aid’s New Jersey pharmacies filled approximately 1,278,000 prescriptions in 1973, producing gross sales of about $4,000,-000. In 1974, according to the stipulated facts, Rite Aid’s New Jersey pharmacies filled approximately 1,600,000 prescriptions for gross sales of about $7,000,000, and in 1975, 1,800,-*1183000 prescriptions for gross sales of about $9,466,000.
By contrast, the pharmacies owned by the five members of the board, taken together, filled 463,615 prescriptions in 1973 and 411,160 in 1974. Except for defendant Silnutzer, who showed an increase of less than 6%, the prescription volume of each board member declined in 1974. (Stipulation of Facts, Tab A, at 7-8)
What percentage share of what relevant market would be sufficient for the majority to find a “substantial” pecuniary interest on the part of the class of all New Jersey pharmacy owners? Suppose Rite Aid did 10% of the prescription volume in County A, 5% in County B and 40% in County C. What would that mean to an independent in each of these counties?

. That law has since been implicitly invalidated by the United States Supreme Court in Virginia State Board of Pharmacy v. Virginia Citizens Consumer Council, Inc., 425 U.S. 748, 96 S.Ct. 1817, 48 L.Ed.2d 346 (1976). Presumably Rite Aid may now advertise its cut-rate prescription prices directly. This development can hardly be expected to endear Rite Aid to its small, independent “regulators.” Whether their individual stores are located near to or far from a Rite Aid store, their customers will now be able to compare Rite Aid’s prices to what is charged locally.

. I note that the Court leaves open the possibility of further proceedings before a single judge of this Court. Ante, at 1177-1178, 1179. Since I am the district judge to whom the case was initially assigned, any further proceedings would normally come before me. In light of the views I have expressed in this opinion, however, I hereby request the Clerk to cause any remaining proceedings in this matter to be assigned to another judge of this Court.