Yakus v. United States

Supreme Court of United States
321 U.S. 414 (1944)

ELI5:

Rule of Law:

Congress may delegate its legislative authority to an administrative agency so long as it provides an intelligible principle to guide the agency's actions. Furthermore, Congress may require that the validity of an administrative regulation be challenged exclusively in a specialized statutory review process, thereby precluding a defendant from raising the regulation's invalidity as a defense in a subsequent criminal prosecution.

Facts:

During World War II, Congress passed the Emergency Price Control Act to combat inflation.
Pursuant to the Act, the Price Administrator issued Revised Maximum Price Regulation No. 169, which established specific maximum prices for the wholesale sale of beef.
Petitioners, who were wholesalers of beef, willfully sold beef at prices exceeding the maximums set by the regulation.
The Act created an exclusive procedure for challenging a regulation's validity, requiring a protest to the Administrator within 60 days, followed by a review in a special Emergency Court of Appeals.
Petitioners did not use this statutory procedure to protest or challenge the validity of the beef price regulation.
By the time petitioners were criminally indicted, the 60-day period for filing a protest against the regulation had expired.

Procedural Posture:

Petitioners were indicted in the U.S. District Court for the District of Massachusetts for willful violation of a price regulation.
At trial, the District Court excluded petitioners' evidence offered to prove the invalidity of the regulation.
A jury found the petitioners guilty, and the District Court entered a judgment of conviction.
Petitioners, as appellants, appealed to the U.S. Circuit Court of Appeals for the First Circuit.
The Circuit Court of Appeals affirmed the convictions of the District Court.
The U.S. Supreme Court granted certiorari to review the judgment of the Circuit Court of Appeals.

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Issue:

Does the Emergency Price Control Act, by granting an administrative agency broad authority to set prices and by requiring that the validity of its regulations be challenged only through an exclusive statutory procedure in the Emergency Court of Appeals, involve an unconstitutional delegation of legislative power or violate the Fifth and Sixth Amendments by precluding a defendant from challenging a regulation's validity as a defense in a criminal prosecution?

Opinions:

Majority - Stone, C.J.

No, the Act does not involve an unconstitutional delegation of power and its procedural requirements do not violate the Constitution. Congress laid down an intelligible principle to guide the Administrator's actions by stating the legislative objective—preventing wartime inflation—and providing clear standards, such as requiring prices to be 'fair and equitable' and giving consideration to historical price levels. The statutory review procedure is the exclusive means for determining a regulation's validity; § 204(d) explicitly removes jurisdiction from all other courts, including criminal trial courts, to consider this issue. This procedure does not violate due process because it provides an adequate opportunity to be heard, and petitioners forfeited their right to challenge the regulation by failing to use the available remedy. There is no constitutional requirement that the validity of a law be adjudicated in the same proceeding as a criminal charge for its violation.

Dissenting - Roberts, J.

Yes, the Act is an unconstitutional delegation of legislative power. The supposed 'standards' guiding the Price Administrator—such as stabilizing prices, preventing profiteering, and protecting fixed-income persons—are so broad and vague that they fail to set any meaningful limits on the Administrator's discretion. This grants the Administrator virtually unlimited power to regulate the economy, which is a core legislative function that Congress cannot delegate. The judicial review procedure is a 'solemn farce' because the burden placed on a challenger is insupportable, making it practically impossible to prove that the Administrator's judgment was arbitrary. This scheme overrules the principles of Schechter Corp. v. United States and allows Congress to abdicate its constitutional duties under the guise of the war power.

Dissenting - Rutledge, J.

Yes, the Act's procedural provisions are unconstitutional as applied in a criminal trial. While Congress has the power to set prices during wartime and to channel civil review to a special court, it cannot deprive a defendant of the right to a full defense in a criminal prosecution. The Act unconstitutionally 'chops up' the criminal trial by forcing the accused to litigate a crucial element of their defense—the validity of the regulation—in a separate, summary civil proceeding, or lose that defense entirely. This violates the defendant's Sixth Amendment right to a trial by jury on all essential issues of the crime and the Fifth Amendment's guarantee of due process by stripping the criminal court of its power to consider the constitutionality of the law it is asked to enforce.

Analysis:

This case is a landmark decision that strongly affirms Congress's power to delegate broad authority to administrative agencies, especially during national emergencies. It solidifies the 'intelligible principle' test as a highly deferential standard, permitting delegations with general policy objectives and flexible guidelines. Critically, Yakus establishes the doctrine of 'jurisdictional channeling,' confirming that Congress can require litigants to use a specific, exclusive administrative and judicial review process, and that failure to do so forfeits the right to challenge a regulation elsewhere, even in the face of criminal charges. This precedent significantly shapes modern administrative law, reinforcing the principle of exhausting administrative remedies and insulating agency actions from collateral attack in enforcement proceedings.

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