Felsenheld v. United States, 186 U.S. 126 (1902)
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Felsenheld v. United States
No. 205
Argued April 7-8, 1902
Decided May 19, 1902
186 U.S. 126
CERTIFICATE FROM THE CIRCUIT COURT
OF APPEALS FOR THE FOURTH CIRCUIT
Syllabus
It is within the power of Congress to prescribe that a package of any article which it subjects to a tax, and upon which it requires the affixing of a stamp, shall contain only the article which is subject to the tax.
The coupons described in the statement of facts are within the prohibitions of the Act of July 24, 1897, 30 Stat. 161.
Neither question three or question four presents a distinct point or proposition of law, and, as each invites the Court to search the entire record, the Court declines to answer them.
This was a proceeding commenced in the Circuit Court of the United States for the District of West Virginia seeking a forfeiture of certain tobacco. Attachment and monition were duly issued. The case was submitted upon an agreed statement of facts, and a judgment of forfeiture was entered. Whereupon the case was taken on error to the Circuit Court of Appeals for the Fourth Circuit, which certified four questions.
The facts as found in the agreed statement are these: at times, a practice prevailed among manufacturers of tobacco of placing in their packages of tobacco other articles of intrinsic value, such as pen knives, etc. On November 4, 1891, the Commissioner of Internal Revenue issued this circular:
Manufacturers of tobacco, in marking the gross, tare, and net weight of packages of tobacco, should include in the gross the full weight of the package and all its contents. The tare should include the weight of the pail, lining, covering, etc., so that the tare, subtracted from the gross, will give the net weight of the tobacco contained therein and expressed by the stamp. Great care should be exercised by the collectors to prevent foreign articles of any kind being included in any of the packages. A practice has grown up, which seems to be on the increase, by which manufacturers have included in statutory packages many foreign articles. This practice should be discontinued. A package of tobacco means a package containing tobacco and nothing else.
On July 24, 1897, Congress passed what is known as the Dingley Bill. 30 Stat. 151, c. 11. The third clause of the tenth section thereof amended section 3394 of the Revised Statutes so as to read:
None of the packages of smoking tobacco and fine-cut chewing tobacco and cigarettes prescribed by law shall be permitted to have packed in, or attached to, or connected with them any article or thing whatsoever other than the manufacturers’ wrappers and labels, the internal revenue stamp, and the tobacco or cigarettes, respectively, put up therein on which tax is required to be paid under the internal revenue laws; nor shall there be affixed to, or branded, stamped, marked, written or printed upon, said packages or their contents any promise or offer of, or any order or certificate for, any gift, prize, premium, payment, or reward.
On the 23d day of September, in the year 1898 at the City of Wheeling, in the district aforesaid, the internal revenue collector of the United States seized 1,440 packages of chewing and smoking tobacco known by the name and brand of Merry World Tobacco, weighing one and two-thirds ounces to the package, and having a total weight of 150 pounds, and afterwards, on the 5th day of April, in the year 1899, J. K. Thompson, the marshal of the United States for the said District of West Virginia, in pursuance of the attachment and monition appearing in the record, took into his possession the said 1,440 packages of tobacco, and now holds the same in his possession.
At the time of the seizure by the collector, there was in each of the packages a small slip of paper called a coupon, with printed words and figures on both sides thereof, which coupon had been placed within such package at the time when it was packed in the manufactory and prepared for sale. These coupons were all alike, and on each of them were the following words and figures, that is to say, upon one side thereof the following words and figures:
Merry World Tobacco Coupon
With the tobacco packed herewith, the purchaser has bought a definite share in any of the articles mentioned on the other side of this voucher.
We will send you postpaid any or all of the articles listed on the other side for the number of coupons as stated.
Mail these coupons to the Merry World Tobacco Co., Wheeling, W.Va. stating number of coupons sent, articles wanted, your name, street and number, city or town, county and state.
And on the other side, the following words and figures:
Will send you postpaid for 20 coupons, 1 picture, 14 x 28, handsome water-color facsimile, 12 subjects.
30 coupons, 1 picture, 20 x 24, fine pastel facsimile, 12 subjects.
40 coupons, 1 picture, 20 x 30, beautiful Venetian scenes, 4 subjects.
50 coupons, 1 picture, 22 x 28, elegant water-color gravures, 2 subjects.
60 coupons, 1 picture, 22 x 28, magnificent water-color gravures, 4 subjects.
No advertising or lettering on any of the above. Such excellent works of art have never before been offered, except through dealers at very high prices. They are suitable decorations for the most elegant home, and to be appreciated must be seen. See descriptive catalogue mailed on application. Order by subjects.
20 coupons, 1 book of Popular Seaside Library, 300 titles by favorite authors.
50 coupons, 1 cloth-bound book, 160 titles by eminent authors. Catalogues of our books mailed on application.
25 coupons, 1 scarf-pin, solid sterling silver.
25 coupons, 1 pipe, genuine French briar.
40 coupons, 1 rubber tobacco pouch, self-closing.
75 coupons, 1 elegant pocketbook, finest quality leather, gent’s or ladies.
70 coupons, 1 pocketknife, first quality, American manufacture razor steel, hand-forged, finely tempered blades. Stag handle. Choice between jackknife or penknife.
95 coupons, 1 fine razor, highest grade steel, hollow ground.
40 coupons, 1 bicycle lock, nickeled, gent’s sprocket or lady’s with chain.
150 coupons, 1 cyclometer, 1,000 miles repeating. In ordering, state size of wheel.
550 coupons, 1 excellent open-face watch. Guaranteed without qualification. Has all improvements up to date. I t will wear and perform well for a lifetime if only ordinarily cared for.
Illustrated catalogue for the above mailed upon application.
This coupon is printed on thin paper, is of inappreciable weight, is without any intrinsic value in itself, and has upon it no picture of any kind and does not affect in any way the ascertaining of the proper tax payable upon the package or interfere in any way with the collection of such tax. The value of the five cases of tobacco of 288 packages each is, and was when they were seized as aforesaid, fifty-four dollars ($54.00). The packages were owned by Emanuel Felsenheld, who at the proper time intervened and claimed the property.
The following are the questions certified by the court of appeals:
First. Whether the third clause of the tenth section of the act of Congress of July 24, 1897, if the prohibition of that statute be applied to the coupons described in the foregoing statement of facts, was in accordance with or in conflict with the Constitution of the United States.
Second. Whether, if the said section be properly construed, the coupons described in the foregoing statement of facts are within its prohibition.
Third. Upon the facts stated, was the seizure set forth in the information of the packages of Merry World tobacco therein described, or was the judgment of forfeiture rendered in this case justified under section 3453 of the Revised Statutes?
Fourth. Upon the facts stated, was the seizure set forth in the information of the packages of Merry World tobacco therein described, or was the judgment of forfeiture rendered in this case, justified under section 3456 of the Revised Statutes?