Walker-Hill Co. v. United States

KERNER, Circuit Judge

(dissenting).

I do not believe it was the intent of Congress to impose the full liquor tax on those who use alcohol in non-intoxicating products.

As lucid as is the maj ority opinion, it has that weakness so fatal to appellate court decisions which attempt to restate the findings of fact of a trial judge.

As I read the statute, it provides that a drawback shall be allowed on all food products unfit for beverage purposes. The District Court found that plaintiff’s eggnog is a food product unfit for beverage purposes; that the labels on plaintiff’s eggnog represented it as a food product and that in its sales plaintiff made no representations to the contrary. In support of his findings the trial judge had before him the appearance of the product itself. It is thick, viscous and semi-solid. It lacks every characteristic of a drink. In addition the trial judge had expert medical testimony which established the product as rich in food value and non-intoxicating.

It is elementary that if there is evidence to support the findings, they must stand. This seems to be conclusive of the case, for whether the purpose of Congress in enacting the heavy tax on alcohol was to raise revenue or curtail drinking, the eggnog differs from the usual alcoholic drink in that it is non-intoxicating. If the effects of the alcoholic consumption are missing and food values are present, then the eggnog must fall within the meaning of the drawback provisions. The quantity of alcohol used in the product then seems immaterial.

Finally, we have the equity of the statute. In view of this evidence and the existence of the letter from the Deputy Commissioner, later revoked, exempting the eggnog as “unfit for beverage use,” the District Court had ample support for its finding. Assuming arguendo, that the eggnog in question is both a food product and a beverage, we are faced with the statutory requirement that it must be “unfit for beverage purposes.” As a beverage, this product seems unfit for beverage purposes, because it cannot be taken as an alcoholic drink.

As pointed out in the case of Iioffman Beverage Co. v. United States, Ct.CL, 147 I'.Supp. 71, if the product for which a drawback is sought comes within the language and equity of the statute, then the plaintiff must prevail. I would affirm the judgment.