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mission has not attacked the pump. On the contrary, it admits the pump's many advantages and great utility. It denies, however, the right of the petitioners to make unlawful contracts with respect thereto or otherwise to use it as a means of stifling competition. The petitioners further urge that the restrictive clause is the only method by which they are enabled to use and adequately protect their trade-mark. Even if this contention were supported by the evidence it would be ineffective, for the petitioners are not at liberty to violate the law of the land whatever proper result may be the consequence of their so doing. The evidence, however, discloses that many
. pumps are owned by retailers, yet there is no evidence that the name of the gasoline being sold through such pumps is not exhibited in the same manner as it is on the leased pumps. Nor is there any evidence that in such cases the gasoline of one wholesaler has been sold as the gasoline of another. These last contentions of the petitioners are, in my judgment, wholly irrelevant to either of the two issues presented with respect to section 3 of the Clayton Act.
Again, the petitioners contend that by means of the leases in question the number of retailers has been substantially enlarged and competition thereby increased rather than lessened. If it be a fact that by means of the leases the number of retailers has been increased, such increase was beyond question due to the nominal rental and not to the tying clause, and the tying clause is none the less invalid even though accompanied by other clauses that are valid. Furthermore, each increase obtained by the nominal rental was simultaneously monopolized by the tying clause and competition thereby lessened and not increased.
Although not differing from the majority of the court as to the legal principles by which the correctness of the second paragraph of the commission's order should be tested, yet I find myself not in full accord with their ultimate decision, for the only conclusion that I am able to reach by applying those principles of law to the facts of these cases is that the effect of the restrictive covenant has been, now is, and so “may be " to substantially lessen
” competition; that the practical effect of that covenant is to prevent the one pump” retailer from using or dealing in the gasoline of a competitor of his lessor and that, consequently, all “one pump” leases are in violation of Section 3 of the Clayton Act and invalid.
MISHAWAKA WOOLEN MANUFACTURING CO.
v. FEDERAL TRADE COMMISSION. Commission's order in 1 F. T. C. 506 requiring petitioner to cease
and desist from using systems of price maintenance therein set forth, affirmed, upon the authority of Federal Trade Commission v. Beech-Nut Packing Co., 257 U. S. 441, and petition for writ of certiorari denied by the Supreme Court with the understanding that the Commission will modify its order
so that the same may be no broader than said decision. (Circuit Court of Appeals, Seventh Circuit. September
Before Baker, Evans, and Page, Circuit Judges.
This is a proceeding to revise an order of the Federal Trade Commission. In its order the Commission found that the petitioner's methods of controlling prices in the retail trade were unfair.
Inasmuch as the record shows that the condemned practices were substantially identical with those involved in Federal Trade Commission v. Beech-Nut Packing Company, 257 U. S. 441, we approve the finding of the Commission upon the authority of that decision.
The petition is accordingly dismissed.
(Supreme Court of the United States. January 8,
No. 720. Per Curiam:
The petition for a writ of certiorari to the United States Circuit Court of Appeals for the Seventh Circuit is denied. The Solicitor General, in his brief for the Federal Trade Commission, concedes that the order affirmed by the Circuit Court of Appeals is broader than the decision in Federal Trade Commission v. Beech-Nut Packing Co., 257 U. S. 441, 42 Sup. Ct. 150, 56 L. Ed. 314, 19 A. L. R. 882, which the Circuit Court of Appeals followed in dismissing the petition for the Woolen Manufacturing Co. The court denies the application for writ of certiorari herein, assuming that the Federal Trade Commission will modify its order accordingly, and without prejudice to an application for that purpose by the petitioner.
1 Reported in 283 Fed. 1022. Appearances : Alexis C. Angell and Henry E. Bodman, of Detroit, Mich., for petitioner. Adrien F. Busick, of Washington, D. C., for respondent.
Reported in 260 U. S. 748, 43 Sup. Ct. 247. Appearances : Henry en Bodman, of Detroit, Mich., for petitioner.
FEDERAL TRADE COMMISSION v. P. LORIL
SAME v. AMERICAN TOBACCO CO., INC.
(District Court, S. D. New York. October 3, 1922.)
1. COMMERCE KEY No. 48FEDERAL TRADE COMMISSION ACT RE
LATES TO INTERSTATE COMMERCE ONLY. Federal Trade Commission Act Sept. 26, 1914 (Comp. St. Par. 8836a-8836k), was enacted under the power conferred on Congress by the commerce clause of the Constitution, and the Commission has no authority in respect to intrastate commerce or transactions.
2. CONSTITUTIONAL LAW KEY No. 48—To BE CONSTRUED SO AS TO
AVOID DOUBT OF CONSTITUTIONALITY. A statute must be construed, if fairly possible, so as to avoid any doubt of its constitutionality. 3. TRADE-MARKS
UNFAIR COMPETITION KEY No. 801, New, VOL. 8A KEY-No. SERIES-POWERS OF
FEDERAL TRADE COMMISSION, A resolution of the Senate directing the Federal Trade Commission to investigate and report the tobacco situation as to the domestic and export trade, etc., but without reference to any alleged violation of law, is not within the provision of Federal Trade Commission Act, Par. 6 (Comp. St. Par. 8836f), authorizing the Commission on direction of the President or either House of Congress to investigate and report the facts relating to any alleged violation of the antitrust acts by any corporation, nor within the provision of section 9 (section 8836i), vesting District Courts with jurisdiction to issue writs of man. damus to compel compliance with the provisions of the act or any order of the Commission made in pursuance thereof, and in the investigation under said resolution neither the Commission nor the court has authority to compel a private corporation to produce its books and papers for inspection and
the making of copies thereof. 4. SEARCHES AND SEIZURES Key No. 7.-LIMITATION OF POWER OF
TRADE COMMISSION. While the Federal Trade Commission may, make investigations, its visitorial power over private corporations must keep within the restrictions of the Fourth Constitutional Amendment. Congress could not grant, and did not intend to grant, to the Commission, an unlimited power of inquisition or an unlimited right of access to books and papers of private parties, not engaged in any public service or of search without basis of some facts tending to establish a charge of wrongdoing.
i Writ of error to Supreme Court allowed on January 2, 1923.
Petitions for mandamus by the Federal Trade Commission against the P. Lorillard Company, and against the American Tobacco Company, Inc. Denied.
William Hayward, U. S. Atty., of New York City, and W. H. Fuller, Chief Counsel for Federal Trade Commission, of Washington, D. C. (A. S. Barnes, of New York City, of counsel), for petitioner.
William D. Guthrie and William B. Bell, both of New York City (Bernard Hershkopf, of New York City, of counsel), for respondent P. Lorillard Co.
John Walsh, of Washington, D. C., and Junius Parker, of New York City (Jonathan H. Holmes, of New York City, of counsel), for respondent American Tobacco Co., Inc.
MANTON, Circuit Judge:
These cases were argued together and will be considered in one opinion.
The petitioner in each of the above-named proceedings was granted an alternative writ of mandamus commanding i he respondent to show cause why a peremptory writ should not issue directing that immediately it forthwith deliver into the possession of the Federal Trade Commis
ion the accounts, books, records, documents, memoranda, papers, and correspondence of the respondent for inspection and examination and for the purpose of making copies thereof. The petition upon which the alternative writ was granted sets forth that on the 16th of September, 1921, a complaint was filed with the Federal Trade Commission against the respondent. The complaint alleged that the respondent in the conduct of its interstate commerce was indulging in practices which were in violation of the provisions of the Act of Congress of September 26, 1914 (38 Stat. 717) in that the respondent was using certain methods of business practices resulting in unfair competition, and that it was regulating and fixing or attempting to regulate and fix the prices at which the commodities sold by it should be resold by those to whom it had sold them, and was cooperating, aiding, and abetting others to successfully formulate and carry out a scheme or combination pursuant to which the resale prices of respondent's commodities should be fixed and maintained by those to whom respondent had previously sold its products or commodities. Further, that the Senate of the Congress of the United States by a resolution directed the Federal Trade Commission to investigate the tobacco situation in the United States as to the domestic and export trade, with particular reference as to the market price to producers of tobacco and the market price for manufacturing tobacco and the price of leaf tobacco
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exported, and to report to the Senate as soon as possible the result of such investigation. Petitioner then sets forth that at various times between September 29, 1921, and November 5, 1921, authorized agents of the petitioner, in its behalf, demanded of the respondent to produce and furnish to them at respondent's offices certain specified documentary evidence or written data, correspondence, and other paper writings which were then and there in the possession, custody, and control of the respondent so that copies thereof or parts thereof might be made. And the respondent, complying with the demands and pursuant to its duty, under the provisions of the Federal Trade Act, did produce for inspection and examination of petitioner's agents certain of the data commanded, but in violation of provisions of the Federal Trade Act, it refused to produce for inspection and examination “certain documentary evidence, records, correspondence, and writings. herein specified which were then and there in respondent's possession, .custody, and control, and it refused to permit copies thereof to be made by petitioner.” And it sets forth that it is necessary in the prosecution of its duty that such inspection and examination be granted to the petitioner's agents and that it is hindered in the performance of its duty and in the exercise of its power by the refusal of the respondent to grant such examination and inspection. Its prayer for relief is that “all papers and telegrams received by the American Tobacco Company (or P. Lorillard Company) from all of its jobber customers located in different points throughout the United States and also copies of all letters and telegrams sent by the American Tobacco Company (or P. Lorillard Company) to such jobbers during the period of January 1, 1921, to December 31, 1921, inclusive” be turned over for examination and inspection. Each respondent resists the application for a peremptory writ, contending that the Federal Trade Commission is asserting authority which it does not possess in seeking to make an unlimited and unrestricted inspection with the right to copy all of the correspondence with its jobber customers, and that the Senate resolution directing the Federal Trade Commission to make the investigation referred to grants no authority for unlimited and unrestricted search with the right to copy the correspondence. It further contends that Secs. 5, 6, and 9 of the Federal Trade Commission Act give no such authority of unlimited and unrestricted search and examination, and it is said that any such construction or interpretation of the Federal Trade Commission Act would be in contravention of the Fourth Amendment of the Constitution guaranteeing the right of the people to be secure in their papers and effects against unreasonable searches and seizures and that no warrant shall issue but upon probable cause supported by oath or affirmation. Thus the question is presented