United States v. Union Supply Co.

Background

A corporation was indicted for willfully breaking a 1902 federal law that required wholesale oleomargarine dealers to keep certain books and make returns. That law’s sixth section imposed both a fine and imprisonment for “any person” who wilfully violated its duties. The district court threw out the indictment because it concluded the statute could not apply to a corporation: a corporation cannot be imprisoned, and the court read the law as requiring imprisonment along with fines.

Reasoning

The Court asked whether the statute’s words and history reached corporate businesses. It noted that the same duties had appeared in an earlier law that clearly covered corporations, so repeating the language suggested no change in meaning. The Court explained that the phrase “wholesale dealers” naturally includes corporate sellers and that the penal phrase “any person” is broad enough to reach corporations. The justices rejected the idea that impossibility of imprisonment should let a corporate defendant escape all punishment. When a statute prescribes separate penalties, the sensible rule is to enforce the parts that can be applied—so a corporation can be fined even if imprisonment cannot be imposed. The Court also contrasted a different section where corporations were mentioned and a judge had discretion about which penalty to use; that difference did not mean corporations were excluded from §6.

Real world impact

The ruling lets the government pursue criminal penalties against companies that fail to keep required oleomargarine records, even though only fines, not jail, can be imposed on a corporation. It restores the indictment and allows prosecutions to proceed where the statutory punishment includes imprisonment for individuals but only fines can effectively reach businesses. This is a narrow decision about how to read the statute, not a broad new rule about corporate punishment.