commission in such form as the commission may prescribe annual or special, or both annual and special, reports or answers in writing to specific questions, furnishing to the commission such information as it may require as to the organization, business, conduct, practices, management, and relation to other corporations, partnerships, and individuals of the respective corporations filing such reports or answers in writing. Such reports and answers shall be made under oath, or otherwise, as the commission may prescribe, and shall be filed with the commission within such reasonable period as the commission may prescribe, unless additional time be granted in any case by the commission.

The above-mentioned chief law officer of the Federal Trade Commission has rendered his opinion specifically with regard to each of the resolutions under consideration, and his position will be found set out in detail in the copy of his opinion hereto attached and to which reference has hereinbefore been made. Briefly stated, his opinion is:

(1) That Senate Resolution 163 (68th Cong., 1st sess.) confers no authority upon the Federal Trade Commission to make, either in whole or in part, the investigation directed by the resolution.

(2) That Senate Resolution 329 (68th Cong., 2d sess.) legally empowers the commission to make the investigation directed by the resolution, except the inquiry directed by the following paragraph of said resolution:

The commission shall also ascertain and report what effort, if any, has been made by the said General Electric Company or other corporations, companies, organizations, or associations, or anyone in its behalf, or in behalf of any trade organization of which it is a member, through the expenditure of money or through the control of the avenues of publicity, to influence or control public opinion on the question of municipal or public ownership of the means by which power is developed and electric energy is generated and distributed. and that the Federal Trade Commission is not empowered by aforesaid subsection to make the investigation directed by this paragraph.

(3) That Senate Resolution 28 (69th Cong., special session of the Senate) does not empower the commission to make, either in whole or in part, the investigation directed by the resolution.

(4) That Senate Resolution 34 (69th Cong., special session of the Senate) does not empower the Federal Trade Commission to make, either in whole or in part, the investigation directed by the resolution.

(5) That subsections (a) and (b) of section 6 of the Federal Trade Commission act do not empower the commission, acting as of its own motion, to make the investigations directed by above-mentioned Senate Resolutions 163, 28, and 34, nor the investigations directed by that paragraph of said Senate Resolution 329 above referred to and set out.

The questions of law upon which each of the foregoing statements of opinion were rendered by the said chief law officer are, specifically, the questions of law upon which the opinion of the Attorney General is desired.

The foregoing is transmitted by direction of the commission. I have the honor to be,

Respectfully yours,

The PRESIDENT,

VERNON W. VAN FLEET, Chairman Federal Trade Commission.

The White House, Washington, D. C.

EXHIBIT 3

LETTER BY MESSRS. NUGENT AND THOMPSON

MAY 4, 1925.

DEAR MR. PRESIDENT: We very respectfully advise you that we do not join with the majority of the Federal Trade Commission in asking you to request the Attorney General of the United States for an opinion in respect of the authority of the commission relative to the matters detailed in the letter of even date addressed to you and signed by Hon. Vernon W. Van Fleet, chairman. We trust that you will understand that our action in this matter is not due to any lack of respect either for you or the Attorney General, but solely to the fact that, in our judgment, the Federal Trade Commission is an independent body and that the extent of its jurisdiction should be determined only by the courts in particular cases in the future as in the past.

Respectfully,

THE PRESIDENT,

Executive Mansion.

Commissioners.

117

EXHIBIT 4

ATTORNEY GENERAL'S OPINION ON THE POWERS AND DUTIES OF THE FEDERAL TRADE COMMISSION IN THE CONDUCT OF INVESTIGATIONS UNDER RESOLUTIONS OF THE UNITED STATES

SENATE

[Prepared by A. F. Myers.

Reviewed by P. R. Chandler. Approved by William J. Donovan and William D. Mitchell]

OCTOBER 24, 1925.

SIR: I have the honor to acknowledge the receipt of your letter dated May 5, 1925, enclosing a communication from the Federal Trade Commission and requesting that I render an opinion on the questions propounded therein. The questions relate to the powers and duties of the Federal Trade Commission in the conduct of investigations under four designated resolutions of the United States Senate. As to these resolutions, severally, the following questions are asked:

1. Is the commission empowered by subsection (d) of section 6 of the Federal Trade Commission act to make the entire investigation called for by the resolution?

2. Is the commission empowered by said subsection to make any part of the investigation directed by the resolution, and if so, what part or parts thereof is the commission empowered to investigate?

3. If the inquiry directed by the resolution is partly within and partly without the power of the commission to investigate under the provisions of said subsection, may the commission legally proceed with that part of the investigation which is legally within such power regardless of the fact that part of the investigation directed is legally without such power?

4. If the Attorney General shall be of opinion that said resolutions, or certain parts thereof, confer no power upon the commission to proceed with such investigations or parts thereof, do subsections (a) and (b) of section 6 of said act confer power upon the commission, proceeding as upon its own motion, to make such investigations or parts thereof?

I note that a preliminary question is suggested in the papers accompanying the submission regarding my authority to render this opinion. I need only say that the practice of rendering opinions to the President for the guidance of independent establishments is of such long standing and is instanced by so many opinions by my predecessors that I must regard it as settled and proper.

A resolution by one of the two Houses of Congress is not legislation and can not add to or detract from the powers already possessed by the commission under preexisting statutes. United States v. Louisville & Nashville R. R. Co., 236 U. S. 318; Federal Trade Commission v. American Tobacco Co., 264 U. S. 298, 283 Fed. 999: Federal Trade Commission v. Baltimore Grain Co., 284 Fed. 886;

statement by Senator Cummins (51 Cong. Rec. 11451). Power to make the investigations in question must, therefore, be found in the subsections of section 6 of the Federal Trade Commission act (copied in the order of their importance in this inquiry) and in the current appropriation act, approved March 3, 1925 (ch. 468, 43 Stat. 1203). SEC. 6. That the commission shall also have power

(d) Upon the direction of the President or either House of Congress to investigate and report the facts relating to any alleged violations of the antitrust acts by any corporation.

(a) To gather and compile information concerning and to investigate from time to time the organization, business, conduct, practices, and management of any corporation engaged in commerce, excepting banks and common carriers subject to the act to regulate commerce, and its relation to other corporations and to individuals, associations, and partnerships.

(b) To require, by general or special orders, corporations engaged in commerce, excepting banks and common carriers subject to the act to regulate commerce, or any class of them, or any of them, respectively, to file with the commission in such form as the commission may prescribe annual or special, or both annual and special, reports or answers in writing to specific questions, furnishing to the commission such information as it may require as to the organization, business, conduct, practices, management, and relation to other corporations, partnerships, and individuals of the respective corporations filing such reports or answers in writing. Such reports and answers shall be made under oath, or otherwise, as the commission may prescribe, and shall be filed with the commission within such reasonable period as the commission may prescribe, unless additional time be granted in any case by the commission. The appropriation act:

No part of this sum shall be expended for investigations requested by either House of Congress, except those requested by concurrent resolution of Congress, but this limitation shall not apply to investigations and reports in connection with alleged violations of the antitrust acts by any corporation.

An investigation which the commission may prosecute pursuant to subsection (d) must relate to an alleged violation of the antitrust acts by some corporation. The above-quoted provision of the appropriation act is but a reaffirmation of the requirements of subsection (d).

The question to be determined in each instance is whether the resolution is so worded as to allege a violation of the antitrust laws by any corporation. The courts have not defined with what definiteness and certainty an alleged violation of the antitrust acts must be charged in the resolution. Federal Trade Commission v. American Tobacco Co., supra, involved a petition for writ of mandamus to compel the respondents, American Tobacco Co. and others, to deliver to the commission certain books, documents, and correspondence. The commission was proceeding (a) under complaints of the use by respondents of unfair methods of competition contrary to the Trade Commission act, and (b) in pursuance of a resolution of the United States Senate. The resolution (S. 129, dated August 9, 1921), merely directed that the commission make a broad investigation as to the prices for certain grades of tobacco. The court in rejecting the resolution as a source of power said (p. 305):

The Senate resolution may be laid on one side, as it is not based on any alleged violation of the antitrust acts within the requirements of section 6 (d) of the act. United States v. Louisville & Nashville R. R. Co., 236 U. S. 318.

1" Corporation" is defined by section 4 to mean "any company or association, incorporated or unincorporated, which is organized to carry on business for profit and has shares of capital or capital stock, and any company or association, incorporated or unincorporated, without shares of capital or capital stock, except partnerships, which is organized to carry on business for its own profit or that of its members."

No procedure is prescribed for alleging violations of the antitrust acts in the resolutions of the House or Senate, and no authority exists for holding such bodies to fixed forms. The debates accompanying the adoption of Senate Resolution No. 329, set out in connection with the consideration of that resolution, show that the Senate itself has declined to be bound to any formal procedure in alleging violations of the antitrust laws.

A main purpose of the Federal Trade Commission act was to enable Congress, through the Trade Commission, to obtain full information concerning conditions in industry to aid it in its duty of enacting legislation. That purpose was emphasized in the proceedings attending the passage of the act (H. Rep. 533, 63d Cong., 2d sess.; S. Rep. 597, 63d Cong., 2d sess.); and in the debates the commission was sometimes likened to a committee of Congress. (State ment by Congressman Stevens, 51 Cong. Rec. 14935.)

Resolutions directing investigations pursuant to section 6, subsection (d), are to be limited in their scope to the ascertainment of facts which reasonably and logically tend to show whether or not the antitrust acts are being violated by any corporation. The existence or nonexistence of a violation of such acts may be disclosed by acts committed by the corporations under investigation and the effect of such acts upon interstate trade and commerce. The investigations should not in any case be enlarged to include an inquiry into any matter which does not have a direct bearing upon the question whether interstate trade and commerce are being unlawfully monopolized or restrained.

In considering particular resolutions it is not enough to stop with the bare language thereof; resort must be had to the proceedings attending their adoption.

2

1. Resolution No. 163 (68th Cong., 2d sess.). This resolution on its face requires, primarily, an economic investigation of the milling and baking industries, and incidentally a report of the facts (if any) tending to show contracts, combinations, etc., in restraint of trade. There is no direct allegation that any corporation or corporations is violating the antitrust acts; but the resolution as introduced contained a preamble reciting a series of alleged facts fairly calculated to bring the investigation within the scope of the commission's authority under subsection (d) of section 6. Certain of these recitals were stated so positively that their adoption in that form would have amounted to a declaration by the Senate that they were true. A Senator having objected to the resolution on the ground stated, the preamble was stricken out. (65 Cong. Rec. 2541.) The preamble follows:

Whereas the price of bread is being maintained at substantially the level of war prices while the price of wheat has declined to pre-war levels; and

Whereas bread made by American flour is selling in England at an average retail price of 4 cents a pound, as compared with an average of 8.7 cents in the United States; and

Whereas the financial reports of flour milling and baking companies so far as published disclose enormous profits during recent years; and

Whereas excessive bread prices have caused a decrease in the consumption of bread in the United States amounting to 44 loaves per person per year; and

2 The resolutions are set out in an appendix to this opinion.