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M. Kraus & Bros. v. United States

United States Supreme Court
327 U.S. 614, 66 S. Ct. 705, 90 L. Ed. 894 (1945)

Written by David Bloom, JD

Facts

[Editor’s Note: The casebook excerpt lists the year of this case as 1945, but the decision was filed in 1946.] M. Kraus & Bros. (Kraus) (plaintiff) was a meat and poultry seller. The United States government (United States) (defendant) charged Kraus and its president with violating the Emergency Price Control Act of 1942, a statute intended to maintain price stability and control inflation during food shortages. The United States price administrator issued a regulation under the Emergency Price Control Act that made evading price ceilings imposed on commodities illegal. Poultry was a primary commodity subject to statutory price ceilings. The United States accused Kraus and its president of circumventing the price ceiling on poultry by requiring customers who wanted to purchase poultry also to buy secondary commodities, such as chicken feet and skin. Such tying arrangements, also called combination sales, were not specifically addressed by the price administrator’s regulation prohibiting price-ceiling evasion. At trial, no evidence was submitted as to what value, if any, the secondary commodities had. Kraus’s president was acquitted, but Kraus was convicted and ordered to pay monetary fines. Kraus appealed the conviction. The intermediate appellate court affirmed the conviction. Kraus petitioned to set aside the conviction.

Rule of Law

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Issue

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Holding and Reasoning (Murphy, J.)

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Dissent (Black, J.)

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