Luther: "If any Council should decree or permit both species, we would by no means acquiesce; but, in spite of the Council and its statute, we would use one form, or neither, and never both"

Recently, the following Luther quote appeared on the CARM boards:

Originally Posted by pvb: "You know at one time Catholics were only allowed the bread. Wine represents the blood poured out by Jesus just as blood was sprinkled for atonement on the Mercy Seat during Old Testament times."

Originally Posted by Garnet: "Same with the first Protestants...the Lutherans. Here is Dr. Luther... "If any Council should decree or permit both species, we would by no means acquiesce; but, in spite of the Council and its statute, we would use one form, or neither, and never both." - Dr. Martin Luther, from 1523's De formula Missae."

Documentation
The quote is documented as "Dr. Martin Luther, from 1523's De formula Missae." It appears that the quote was taken from James Gibbons, The Faith of Our Fathers: Being a Plain Exposition and Vindication of the Church Founded by Our Lord Jesus Christ (New York: P.J. Kenedy and Sons, 1917),p. 246. There Gibbons states,

St. Paul, writing to the Corinthians, says: "Whosoever shall eat this bread, or drink the chalice of the Lord unworthily, shall be guilty of the body and of the blood of the Lord." The Apostle here plainly declares that, by an unworthy participation in the Lord's Supper, under the form of either bread or wine, we profane both the body and the blood of Christ. How could this be so, unless Christ is entirely contained under each species? So forcibly, indeed, did the Apostle assert the Catholic doctrine that the Protestant translators have perverted the text by rendering it: "Whosoever shall eat this bread and drink the chalice," substituting and for or, in contradiction to the Greek original, of which the Catholic version is an exact translation. It is also the received doctrine of the Fathers that the Eucharist is contained in all its integrity either in the consecrated bread or in the chalice. St. Augustine, who may be taken as a sample of the rest, says that "each one receives Christ the Lord entire under each particle."Luther himself, even after his revolt, was so clearly convinced of this truth that he was an uncompromising advocate of communion under one kind. "If any Council," he says, "should decree or permit both species, we would by no means acquiesce; but, in spite of the Council and its statute, we would use one form, or neither, and never both."5
5 de Formula Missae

"de Formula Missae" refers to Formula Missae et Communionis pro Ecclesia Vuittembergensi (1523). It has been translated into English as  An Order of Mass and Communion for the Church at Wittenberg, found in LW 53 (15-40) and also PE 6 (83-101).

Context
"Now concerning private confession before communion, I still think as I have held heretofore, namely, that it neither is necessary nor should be demanded. Nevertheless, it is useful and should not be despised; for the Lord did not even require the Supper itself as necessary or establish it by law, but left it free to everyone when he said, “As often as you do this,” etc. [I Cor. 11:25–26]. So concerning the preparation for the Supper, we think that preparing oneself by fasting and prayer is a matter of liberty. Certainly one ought to come sober and with a serious and attentive mind, even though one might not fast at all and pray ever so little. But the sobriety I speak of is not that superstitious practice of the papists. I demand it lest people should come belching their drink and bloated with overeating. For the best preparation is—as I have said—a soul troubled by sins, death, and temptation and hungering and thirsting for healing and strength. Teaching these matters to the people is up to the bishop.

It remains to be considered whether both forms, as they call them, should be administered to the people. Here I say this: Now that the gospel has been instilled among us these two whole years, we have humored the weak in faith long enough. Hereafter we shall act according to the words of St. Paul, “If any man be ignorant, let him be ignorant” [I Cor. 14:38]. For if after all this time they have not understood the gospel, it matters little whether they receive either form. If we continue to make allowance for their weakness, we only run the risk of confirming their obstinacy and of making rules contrary to the gospel. Wherefore, both forms may be requested and shall be offered in simple compliance with the institution of Christ. Those who refuse them will be left alone and receive nothing. For we are devising this order of the mass for those to whom the gospel has been proclaimed and by whom it has been at least partly understood. Those who have not yet heard or understood it are also not ready to receive advice concerning this matter [of liturgical forms].

Nor is it necessary to wait for a council—as they prate—in order to have this practice sanctioned. We have the law of Christ on our side and are not minded to be delayed by or to listen to a council in matters which manifestly are part of the gospel. Nay, we say more: If by chance a council should establish and permit this practice, then we would be the last to partake of both forms. Nay, in contempt both of the council and of its statute, we should then wish to partake either of one or of neither, but never of both; and we would hold those to be wholly anathema who on the authority of such a council and statute would partake of both.

You wonder why and ask for a reason? Listen! If you know that the bread and wine were instituted by Christ and that both are to be received by all—as the Gospels and Paul testify so clearly that even our adversaries themselves are forced to admit it—and if you still dare not believe and trust in Him enough to receive both forms, but dare to do so after men decide this in a council, are you not preferring men to Christ? Do you not extol sinful men over Him who is named God and worshiped as such [II Thess. 2:3–4]? Do you not trust in the words of men more than in the words of God? Nay rather, do you not utterly distrust the words of God and believe only the words of men? And how great a rejection and denial of God the most high is that? What idolatry can be compared to the superstitious regard in which you hold the council of men? Should you not rather die a thousand deaths? Should you not rather receive one or no form at all, than [both] in the name of an obedience which is a sacrilege and of a faith that amounts to apostasy?

Therefore, let them stop prating of their councils. First, let them do this: Let them restore to God the glory which they have denied him. Let them confess that with Satan their master they have held back one form, that they have lifted themselves up above God, that they have condemned his word, and have led to perdition so many people for so long a time. And let them repent of this unspeakably cruel and godless tyranny. Then, let them solemnly declare that we have done right when on our part and even against their dogma we have taught and received both forms and have not waited for their council. And let them give thanks, because we have refused to follow their perditious abomination. When they have done this, we shall gladly and willingly honor and obey their council and [its] statute. In the meantime, while they fail to do so and instead continue to demand that we should await their authorization, we shall listen to nothing. Rather, we shall continue to teach and act against them, particularly where we know it displeases them most. For what do they require with their diabolical demand except that we should exalt them above God and their words above his, and that we should receive the phantoms of their fancy as idols in the place of God? It is our concern, however, that the whole world be completely subjected and obedient to God."

Luther, M. (1999, c1965). Vol. 53: Luther's works, vol. 53 : Liturgy and Hymns (J. J. Pelikan, H. C. Oswald and H. T. Lehmann, Ed.). Luther's Works (53:34-35). Philadelphia: Fortress Press.

Conclusion
Contrary to Gibbons,The context explains the remark, and shows Luther's sarcasm against "councils" in regard to this issue. Gibbons clearly botched the context. Gibbons was exposed for this remark by Rev. Edward J. Stearns, Faith of our Forefathers, An Examination of Archbishop Gibbon's "Faith of our Fathers, pp. 301-302:

As our Lord said to the eleven (or to the twelve, if Judas was present), "Drink ye all of this," and St. Mark records that " they all drank of it;" and as the Archbishop's objection that this was said " not to the people at large, but only to the Apostles," (p. 301,) is answered, as he very well knows, by his admission (p. 298) that " even the clergy of every rank, including the Pope, receive only of the consecrated bread, unless when they celebrate Mass;" and as Cardinal Bona admits that "always, everywhere, from the very first foundation of the Church to the 12th century, the faithful communicated under the species both of bread and wine;" and as the Archbishop himself confesses (p. 304) that the withholding of the cup was first enacted into a law by the Council of Constance in 1414; and as the alleged exceptional instances, of communion in one kind in the early history of the Church, and the alleged sufficiency of such communion, even with Augustine and Leibnitz to back it (if they do back it), amount to nothing in the face of the plain command of our Saviour, "Drink ye all of it; and as I have already (p. 79) refuted the Archbishop's calumnious accusation (p. 300) against " the Protestant translators" of 1 Cor. 11 : 27, I shall confine myself to the extraordinary paragraph about Luther, and to the last three paragraphs of the chapter, in which the Archbishop apologizes for not obeying the command of Christ by alleging certain difficulties in the way of obedience to it! The paragraph respecting Luther is as follows: "Luther himself, even after his revolt, was so clearly convinced of this truth, that he was an uncompromising advocate of communion under one kind. 'If any Council,' he says, 'should decree or permit both species, we would by no means acquiesce; but in spite of the Council and its statute, we would use one form, or neither, and never both.'—De formula Missce."

Of course, any one familiar with the works of Luther, knows that in the part I have italicized above, there is no truth. It is the old Jesuit trick of taking what the logicians call dictum secundum quid for simpliciter dictum; that is to say, in quoting what is said relatively, to leave out that relatively to which it is said, and quote it as said absolutely. To illustrate: On page 241, above, I said: "I scorn to be ' tolerated' in the enjoyment of that which is my birthright. Like him whose blood flows in my veins, the first Governor Dudley of Massachusetts, but for a very different reason, I cry out, from the bottom of my soul, and with all the strength that is in me, against this un-American, un-nineteenthcentury, ' intolerable toleration.' "—Suppose the Archbishop, or some of his understrappers, were to quote me thus: "Like him whose blood flows in my veins, the first Governor Dudley of Massachusetts, I cry out, from the bottom of my soul, and with all the strength that is in me, against this 'intolerable toleration;'" leaving out the qualifying words, without giving any indication that anything was left out; and, commenting upon it, represent me as "an uncompromising advocate" of intolerance, and add, that, by my own confession, it was born and bred in me! He would be serving me exactly as he has served Luther. But as he is in the habit of serving the Bible and the Fathers so, as I have already shown (p. 113) and have yet to show, (p. 337) it is not strange that he should serve a heretic the same scurvy sauce. Here is what Luther says, the part which I have italicized being that, in the first paragraph, which the Archbishop has left out. It will be seen that what Luther is denouncing is, not communion in both kinds, as the Archbishop represents, but, putting the Councils of men above the Word of God:

"If by any chance a Council by its own authority should decree or permit it, in that contingency by no means would we use both species; rather, then first, in spite as well of the Council as of its statute, would we use one or other of the two only, or neither, and by no means both, and would plainly anathematize those, whosoever they might be who, on the authority of such Council or statute, should use both.

"Do you wonder, and ask why? Listen; If you know the bread and the wine to have been instituted by Christ, both, namely, to be taken by all, as the Gospels and Paul most clearly testify, so that even our adversaries are compelled to confess it, and yet dare not believe and trust Him, so as to take it on His authority, {literally, to take it so), but are bold to take it, if men in their Council decree it, are you not in that case preferring men to Christ? Are you not exalting Men of sin above all that is called God, or that is worshipped? Are you not relying upon the words of men, rather than upon the words of God? Nay, you altogether distrust the words of God, and believe only the words of men. But how great is that abomination and denial of the Most High God? What idolatry then can equal your so scrupulous obedience to a Council of men? Ought you not rather a thousand times to die? Ought you not rather to receive one species or none, than, in such obedience so sacrilegious and apostasy of faith, to receive both?"