THE JUDICIAL REFORMS OF 1937.

• Author: Cushman, Barry

ABSTRACT

The literature on reform of the federal courts in 1937 understandably focuses on the history and consequences of President Franklin D. Roosevelt's ill-fated proposal to increase the membership of the Supreme Court. A series of decisions declaring various components of the New Deal unconstitutional had persuaded Roosevelt and some of his advisors that the best way out of the impasse was to enlarge the number of justiceships and to appoint to the new positions jurists who would be "dependable" supporters of the administration's program. Yet Roosevelt and congressional Democrats also were deeply troubled by what they perceived as judicial obstr-uction in the lower federal courts. The "universal injunction" had yet to emerge, but friends of the administration nevertheless maintained that injunctive relief granted by the lower courts was substantially, and in some cases decisively, frustrating implementation of vital elements of the New Deal agenda. This Article surveys the uses and perceived effects of such injunctive relief, and relates the story of efforts by the political branches to address this challenge through (1) enlargement of the lower federal judiciary, and (2) reforms to judicial procedure and/or jurisdiction that would inhibit the power of lower federal courts to thwart implementation of federal programs. The principal solution at which the Roosevelt administration arrived required, among other things, that only three-judge district court panels be authorized to enjoin the enforcement of federal law. This requirement remained for nearly forty years before it was repealed in 1976-ironically, one might think--just as the universal injunction was emerging as a phenomenon, and the stakes of a single judge having power to grant injunctive relief increased accordingly.

TABLE OF CONTENTS INTRODUCTION I. INJUNCTIONS II. CONGRESSIONAL RESPONSES A. Program Redesign B. Judicial Appointments C. Reform of Judicial Procedure III. AFTERMATH CONCLUSION INTRODUCTION

The literature on reform of the federal courts in 1937 understandably focuses on the history and consequences of President Franklin D. Roosevelt's ill-fated proposal to increase the number of seats on the Supreme Court from nine to fifteen. (1) A series of decisions declaring various components of the New Deal unconstitutional (2) persuaded Roosevelt and some of his advisors that the best way out of the impasse was to enlarge the number of justiceships and to appoint to the new positions jurists who would be "dependable" supporters of the administration's program. (3) Yet Roosevelt and congressional Democrats also were deeply troubled by what they perceived as judicial obstruction in the lower federal courts. They were particularly concerned with the issuance of injunctive relief restraining the execution of New Deal measures, and with the role that judicial appointments and the reform of judicial procedure might play in ameliorating such difficulties.

1. INJUNCTIONS

   On February 17, 1937, just twelve days after the President unveiled his Court-packing plan, Democratic Senator Pat McCarran of Nevada introduced, and the Senate approved, Senate Resolution 82. (4) That Resolution provided:

   Whereas the President of the United States has presented to Congress a message bearing upon the judiciary and judicial reform, and has made reference to the delays surrounding the administration of justice and the inequality, uncertainty, and delay in the disposition of vital questions of constitutionality arising under our fundamental law; and Whereas the operations of the Government, including the collection of its revenues, have been impaired and suspended by the exercise of jurisdiction over its agencies by the Federal courts; and Whereas as a result of the issuance of extraordinary writs by Federal courts and of judgments rendered in such courts, such writs and judgments in all amounting to several thousands within the past 3 years, acts of Congress have been set aside or nullified or made inoperative: Therefore be it Resolved, That for the aid and information of the Congress in the consideration of such conditions with a view to the correction of such abuses as may exist, [six named federal departments and fourteen named federal agencies] are each requested to transmit to the Senate, at the earliest practicable date, the following information: (1) A statement of all cases in which injunctions, restraining orders, or other judgments have been issued, rendered, or denied by the Supreme Court or inferior Federal courts since March 4, 1933, enjoining, suspending, or restraining the enforcement, operation, or execution of any act of Congress, or any provision thereof, administered by such department or agency, or by any other agency the functions of which have heretofore been transferred to such department or agency. (2) A brief statement concerning each of such cases, showing the extent to which, and the manner in which, the operations of the Government have been affected. (5) Over the course of the next five weeks, no fewer than seventeen departments and agencies submitted such reports. (6) These included reports from the Department of Justice, (7) the Department of the Treasury, (8) the Department of the Interior, (9) the Department of Agriculture, (10) the Department of Commerce, (11) the Federal Trade Commission, (12) the Veterans' Administration, (13) the National Mediation Board, (14) the Federal Power Commission, (15) the Federal Communications Commission, (16) the Federal Emergency Administration of Public Works, (17) the Social Security Board, (18) the Tennessee Valley Authority, (19) the Railroad Retirement Board, (20) the National Labor Relations Board, (21) the Works Progress Administration, (22) and the Securities and Exchange Commission. (21) The most comprehensive of these reports was that of Attorney General Homer Cummings, which reported on all such cases in which his Department had been involved, and also contained the report of the Department of the Treasury, which bore responsibility for the collection of taxes by which much of the New Deal was enforced or financed. (24) But the reports of several other departments and agencies also shed considerable light on the nature and effects of litigation in which neither Justice nor Treasury was involved. (25) In the aggregate, these reports demonstrate that even in a world without universal injunctions, (26) intervention by lower federal courts could substantially frustrate the implementation of regional and even national programs for relief, recovery, and reform.

   Consider first the Roosevelt administration's program for industrial recovery. The centerpiece of that initiative was the National Industrial Recovery Act (NIRA) and the Codes of Fair Competition (the Codes) promulgated thereunder. (27) One hundred sixty-two suits were brought against government officials to enjoin various provisions of the NIRA or the Codes. (28) This resulted in the granting of four permanent injunctions, eleven temporary injunctions, and twenty-seven temporary restraining orders (TROs) against the government. (29) In many of these cases, the district court did not rule on the constitutionality of the NIRA or Code provision, but instead rested its decision on equitable principles, such as "whether [the] plaintiff was likely to suffer irreparable injury, or whether the Government officer sued was authorized to enforce the law against the plaintiff." (30) In addition, the government successfully brought actions seeking injunctions or criminal penalties in fortythree judicial districts. (31) The NIRA was held unconstitutional in eighteen of those districts, and Cummings noted that such decisions "served as effectively to restrain further prosecution in [such a] district as the granting of an injunction against the Federal prosecuting officers." (32) Cummings explained that it was "impossible to state definitely how each individual case separately affected the operation of the Government in enforcing" the NIRA, but he recognized that "[e]ach decision necessarily had an important effect upon compliance with the act in the district in which it was handed down." (33)

   The NIRA was declared unconstitutional by the Supreme Court in A. L. A. Schechter Poultry Corp. v. United States on May 27, 1935, but enforcement of the NIRA had become problematic well before that decision. (34) Cummings reported that "[a]fter a number of lower courts had held the act unconstitutional, and when it became apparent that for this, and possibly other reasons, ... enforcement of the act was unlikely, violations became widespread." (35) It was "common knowledge" that "during the last few months before the Schechter decision, the purpose of the act was nullified to a considerable extent by the inability of the Government to enforce it." (36) This may have been due "as much to the decisions denying the constitutionality of the act as to the fact that injunctions were granted restraining its enforcement." (37)

   The report of the Department of the Interior detailed the litigation concerning the Petroleum Code of the NIRA. (38) Section 9(c) of the NIRA authorized the President to prohibit the interstate shipment of so-called "hot oil"--oil produced in excess of the amount permitted by the law of the state of production. (39) The President issued such a prohibition by executive order, and also delegated authority to promulgate appropriate rules and regulations to the Secretary of the Interior. (40) By a separate executive order, the President approved a Code of Fair Competition for the oil industry. (41)

   A petition filed in the Supreme Court for the District of Columbia sought a temporary injunction against enforcement of the Code on the ground that the NIRA was unconstitutional. (42) That relief was denied on August 15, 1933, after which the plaintiffs dropped the suit. (43) Another injunction was sought by another party before the same court on...