This cause is here a second time. The prior appeal was from a decree denying a preliminary injunction and dismissing the bill. We reversed, holding that evidence should be taken, findings and conclusions made, and a decree thereupon entered. After remand the appellant amended its bill, the court sent the case to a master who made findings of fact, stated his conclusions of law, and recommended that an injunction be entered. The District Court accepted the master's findings, and found certain additional facts, but dismissed the bill upon the merits. From this judgment the present appeal was taken.
As will appear by reference to our former opinion, the appellant's complaint is that the fixing of a differential of not to exceed one cent per quart on sales to stores, in favor of milk dealers not having a 'well advertised trade name,' by the Milk Control Law of April 10, 1933, Laws N.Y. 1933, c. 158 (re-enacted by the Laws N.Y. 1934, c. 126 (Agriculture and Markets Law N.Y., Consol. Laws, N.Y. c. 69, § 258-q, as added by Laws N.Y. 1934, c. 126, § 2)), was an invasion of rights guaranteed by the Fourteenth Amendment. The bill, as framed when the case was here before, recited that the administrative authority which fixed the minimum price on sales to stores found the appellant and three other milk dealers in the metropolitan market had well-advertised trade-names and the statute permitted dealers not having such trade-names to sell bottled milk to stores at one cent per quart less than the minimum which dealers with well advertised trade-names were required to charge, and also permitted stores to resell to their customers the unadvertised brands of milk at a price one cent per quart less than that at which the appellant's milk could be sold under the minimum fixed by the order. Resulting loss of business and irreparable damage were alleged.
In this court the appellees sought to justify the differential by the assertion that the statute was temporary in character, intended to relieve a temporary economic situation, and meanwhile to prevent monopoly of the business by dealers having well-advertised names. In support of this position it was said that prior to the adoption of the Milk Control Act of 1933 independent dealers, so-called, had purchased from producers at prices lower than those paid by appellant and other purveyors of well-advertised brands, and in turn charged less to stores than the appellant and others in its class. By the Milk Control Act the independent dealers were compelled to purchase from the farmers on the same basis as the well-known dealers; and to deprive them of this advantage and in turn to compel them to charge the same price for their milk as the well-advertised brands commanded would be to transfer all their customers to the owners of well-known brands, and put them out of business. The appellant replied that, prior to the adoption of the Milk Control Law, there had been a threat to forbid the sale of milk in bulk to stores; this compelled the independents who had formerly sold mostly bulk milk to change to the bottled trade, and keen competition ensued between them and the owners of well-advertised brands with destructive price cutting throughout the greater part of New York City, so that there was no fixed price for bottled milk sold to stores either by the independents or the well-advertised dealers. In support of these contentions we were referred to statements found in the legislative report leading to the adoption of the Milk Control Law, and the injunction affidavits.
We held we could not take judicial notice of local trade conditions prevailing in the city of New York; as the case had been disposed of below on the allegations of the bill, we were not called upon to examine the affidavits submitted in support of the motion for injunction and to find the facts; and the constitutionality of the challenged provision should be determined in the light of evidence upon the matters as to which the parties were in disagreement.