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AERATED PRODUCTS CO. OF PHILADELPHIA, PA. v. DEPARTMENT OF HEALTH OF NEW JERSEY et al.

O'CONNELL, Circuit Judge.

The Aerated Products Company of Philadelphia, Pennsylvania (hereinafter called "plaintiff"), a Pennsylvania corporation, operates in Philadelphia a plant which manufactures a patented product called Instantwhip. Packed in a small metal container, Instantwhip is used widely, throughout the United States, as a topping for sundaes, desserts, and the like.

The ingredients of the product are butterfat, cream or milk, sugar, and vanilla. Harmless nitrous oxide gas is forced through this mix to puff it into the shape generally associated with whipped cream.

Among plaintiff's customers was the Aerated Products Company of Newark (hereinafter called "Newark-Aerated"), an independent corporation which purchased plaintiff's product and resold it in smaller quantities to restaurants and soda fountains in New Jersey, from August, 1940, until April 1941.

Several local New Jersey boards of health, early in 1941, raised the question whether Instantwhip could be dispensed in their areas without meeting the requirements of Title 24, Chapter 10, of the Revised Statutes of New Jersey of 1937, N.J.S.A. Plaintiff thereupon made application for a permit. Representatives of defendant Department of Health of the State of New Jersey (hereinafter called "Department") inspected plaintiff's plant, as a result of which it was ascertained that a certain dairy from which plaintiff received milk and cream had not been approved by the Department. Consequently, on April 9, 1941, defendant J. Lynn Mahaffey (hereinafter called "Mahaffey"), Director of Health of the State of New Jersey, wrote plaintiff a letter in which he rejected plaintiff's application for a permit to distribute under the statute. Six days later, Mahaffey, in a letter to Newark-Aerated, withheld approval of its application for a permit for the same reason, and added the following remark: "* * * furthermore, you are advised to immediately discontinue the distribution of milk products in this State, which said products are obtained from or prepared for distribution in any milk plant or creamery which fails to meet the requirements of the statute aforementioned."

This chapter regulates the distribution and sale of milk products within New Jersey. Pertinent portions of the statute are:
"24:10-1. Milk products. j. Milk products is defined as cream, ice cream, ice cream mix, sherbets, cream cheese, or other food for human consumption made from milk or cream, or both.


The dairy had been approved, however, by the appropriate Pennsylvania and Philadelphia health authorities. That plaintiff's product is pure and wholesome is not contested.

The text of this letter to plaintiff is as follows:

Conversations between plaintiff and a representative of the Department, both before and after the letters quoted above, revealed that plaintiff would be granted a permit only if all the milk and cream used in plaintiff's plant came from sources approved by the Department. Plaintiff thereupon brought this suit, seeking an injunction to prevent the Department and Mahaffey from interfering with the sale of Instantwhip in New Jersey and from enforcing the statute, which was alleged to be in violation of the Constitution of the United States.

The Department had approved of other sources in Pennsylvania, but not of this source.

At the conclusion of the testimony in the court below, the district judge granted a motion to dismiss as to the Department, on the ground that the Department is the State, which the Eleventh Amendment renders immune to suit; and entered judgment for Mahaffey on the merits, finding that he had neither taken nor threatened action giving plaintiff a cause for complaint. The court took the view that the permit negotiations between plaintiff and the representatives of Mahaffey were of no legal effect, because "the statute specifically limits its operation to the production, distribution and sale of milk, cream and milk products within the State of New Jersey," and "the provisions of this statute do not apply to nonresidents of New Jersey." D.C. 1945, 59 F. Supp. 652, 657.

The lower court also made the following finding of fact: "The plaintiff was advised by defendant J. Lynn Mahaffey, that it discontinue sending its product into the State." This statement also appears in the opinion, with the word "advised" italicized. The transcript of the trial testimony submitted to this court, however, indicates that Mahaffey himself dealt directly with the plaintiff only when he wrote the letter set forth in footnote 3, supra; and the opinion of the lower court includes the statement that "* * * the only evidence appearing in the case of any action on the part of this defendant [Mahaffey] directed towards this plaintiff is the following letter written by him: [text of letter quoted in footnote 3, supra]."
Plaintiff did introduce testimony concerning the interviews with one of Mahaffey's assistants. One of the two witnesses testified that Mahaffey's assistant said that Instantwhip could not be shipped, the other witness that the assistant said Instantwhip could not be sold, unless cream approved by New Jersey was used.

The Eleventh Amendment of the Federal Constitution denies to federal courts the jurisdiction over suits against a State by citizens of another State. The Department is a part of the executive branch of the New Jersey government. Revised Statutes of New Jersey of 1937, 26:2-1 et seq., N.J.S.A.; Board of Health v. Mundet Cork Corporation, 1939, 126 N.J. Eq. 100, 8 A.2d 105, affirmed 1940, 127 N.J. Eq. 61, 11 A.2d 260. Consequently, we agree with the court below that plaintiff's suit against the Department is prohibited by the Eleventh Amendment. Ford Co. v. Department of Treasury, 1945, 323 U.S. 459, 65 S.Ct. 347, 89 L.Ed. 389.

As to Mahaffey, the rule is equally clear that his function as a public official brings him within the protection of the Eleventh Amendment only if the statutes authorizing his actions are constitutional, and if his actions do not exceed the authority granted him. Baldwin v. G.A.F. Seelig, 1935, 294 U.S. 511, 55 S.Ct. 497, 79 L. Ed. 1032, 101 A.L.R. 55. If the activities of Mahaffey are in violation of a right guaranteed by the federal Constitution, this court has jurisdiction to enjoin such violation.

Plaintiff's appeal, therefore, raises two questions which we have jurisdiction to decide: (1) Does New Jersey have the power to limit the distribution and sale in New Jersey of Instantwhip manufactured in Pennsylvania? (2) Is plaintiff entitled to an injunction preventing Mahaffey from interfering with shipments of Instantwhip into New Jersey?

As to the first question: The testimony reveals that all distributing and selling of Instantwhip in New Jersey is performed by Newark-Aerated. Newark-Aerated is not acting as an agent of plaintiff, and is not a party to this suit. Adjudication of this issue, therefore, would affect the rights of Newark-Aerated without giving it the opportunity to be heard. See Mallow v. Hinde, 1827, 25 U.S. 193, 198, 12 Wheat. 193, 198, 6 L.Ed. 599; quoted in Buss v. Prudential Ins. Co. of America, 8 Cir. 1942, 126 F.2d 960, 967. Consequently, we are not called upon to decide, and do not decide, what effect the statute and the activities of Mahaffey would have upon the rights of Newark-Aerated.

As to the second question: Our examination of the record in this case indicates that the district court did not abuse its discretion in finding that no action had been taken or threatened by Mahaffey which would jeopardize plaintiff's right to ship. Indeed, defendant concedes the right, and points out further that that right was exercised without hindrance for nine months, while the statute was in effect.

Since no attempt has been made, or is contemplated, to apply the statute to shipments by plaintiff, the contention that Instantwhip is a "food product" and not a "milk product" becomes academic. It is sufficient to note that the definition of "milk products" in the statute (paragraph 24:10-1 j, set forth in footnote 2, supra), as conceded by plaintiff, is sufficiently broad to include Instantwhip. Such classification we deem to be neither capricious nor ill-advised. Cf. Leaman v. District of Columbia, 1932, 60 App.D.C. 395, 55 F.2d 1020.

At best, therefore, it would appear that an injunction is sought prematurely by plaintiff. "It is elementary that a court of equity will not grant an injunction to restrain one from doing what he is not attempting and does not intend to do." Blease v. Safety Transit Co., 4 Cir. 1931, 50 F.2d 852, 856.

Affirmed.

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AERATED PRODUCTS CO. v. DEPT. OF HLT. OF N.J
(Feb 14, 1947)