way Co., 135 U. S. 641, 653, 10 Sup. Ct.od of competition, under Act Sept. 26, 1914, § 5 (Comp. St. § 8836e), should follow the com- [5] The grant of the right of way in 1862, was present and absolute and upon identification of the route, took effect as of the date of the act. All who thereafter acquired public lands took subject to such granted right. Railroad Co. v. Baldwin, 103 U. S. 426, 430, 26 L. Ed. 578. Although parties to the treaty of 1861 contemplated future allotments, it made none. No individual title to any portion of the land arose until allotted, and none was allotted until after 1862. Mr. Justice CLARKE dissents. Mr. Justice HOLMES, Mr. Justice PITNEY, and Mr. Justice BRANDEIS did not participate in consideration or decision of this case. Under Act Sept. 26, 1914, § 5 (Comp. St. $8836e), declaring unfair methods of competition in commerce unlawful, it is for the courts, and not for the Federal Trade Commission, ultimately to determine as matter of law what constitutes unfair methods of competition. Any claim by plaintiffs in error based upon adverse occupancy or possession is precluded by Northern Pacific Railroad Co. v. Smith, 171 U. S. 260, 18 Sup. Ct. 794, 43 L. Ed. 157; Northern Pacific Railroad Co. v. Townsend, 190 U. S. 267, 23 Sup. Ct. 671, 47 L. Ed. 1044; Northern Pacific Railroad Co. v. Ely, 197 U. S. 1, 25 Sup. Ct. 302, 49 L. Ed. €39; Kindred v. Union Pacific Railroad Co., supra, 597 of 225 U. S., 32 Sup. Ct. 780, 56 L. Ed. 1216. We find no error in the judgment below, Competition.] and it is affirmed. 4. TRADE-MARKS AND TRADE-NAMES 68"UNFAIR METHODS OF COMPETITION" DO NOT INCLUDE PRACTICES NOT HERETOFORE CONDEMNED. 2. TRADE-MARKS AND TRADE-NAMES 802, Act Sept. 26, 1914, § 5 (Comp. St. § 8836e), declaring "unfair methods of competition" unlawful, does not apply to practices never heretofore regarded as opposed to good morals, because characterized by deception, bad faith, fraud, or oppression, or as against public policy, because of their dangerous tendency unduly to hinder competition or create monopoly. [Ed. Note. For other definitions, see Words and Phrases, First and Second Series, Unfair 5. TRADE-MARKS AND TRADE-NAMES 80%, A complaint filed by the Federal Trade Commission under Act Sept. 26, 1914, § 5 (Comp. St. § 8836e), charging that sellers of cotton ties and bagging and their selling and FEDERAL TRADE COMMISSION v. GRATZ fect of discouraging and stifling competition in distributing agents, with the purpose and ef (253 U. S. 421) et al. (Argued April 20 and 21, 1920. Decided June 7, 1920.) the sale of such bagging, had refused to sell ties, unless the purchaser would buy from them a corresponding amount of bagging, was insufficient to support an order to desist from such practice, where it did not intimate that they did not properly obtain their ties and bagging, or state the amount controlled by them, or allege that they held a monopoly of either ties or bagging, or had ability, purpose, or intent to acquire one, or allege anything justifying the conclusion that the public suffered injury, or that competitors had reasonable ground for complaint. No. 492. 1. TRADE-MARKS AND TRADE-NAMES 802, 6. TRADE-MARKS AND TRADE-NAMES 68- Under Act Sept. 26, 1914, § 5 (Comp. St. § 8836e), providing that, when the Federal Trade Commission has reason to believe that a person, etc., has used an unfair method of competition, it shall formulate and serve a complaint, stating the charges, and after a hearing, All questions of monopoly or combination if it deems the method of competition in ques-being out of the way, a private merchant, acttion prohibited thereby, shall issue an order re-ing with entire good faith, may properly requiring the accused to cease and desist from fuse to sell, except in conjunction, such closely using such method, if the complaint is plainly associated articles as steel ties used for binding insufficient to show unfair competition, there is bales of cotton, and jute bagging used to wrap no foundation for an order to desist. such bales. Mr. Justice Brandeis and Mr. Justice Clarke dissenting. On Writ of Certiorari to the United States An order of the Federal Trade Commission Circuit Court of Appeals for the Second Cirto cease and desist from using a specified meth-cuit. For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes (40 Sup.Ct.) Proceeding by Anderson Gratz and another, doing business as Warren, Jones & Gratz, and others, against the Federal Trade Commission, to set aside an order of the Commission. The order was annulled by the Circuit Court of Appeals for the Second Circuit (258 Fed. 314, 169 C. C. A. 330), and the Commission brings certiorari. Affirmed. See, also, 250 U. S. 657, 40 Sup. Ct. 13, 63 "and shall certify and file with its application merce as: cept that the same shall be subject to review by the Supreme Court upon certiorari as provided by section 240 of the Judicial Code. Any party required by such order of the commission to cease and desist from using such method of competition may obtain a review of such order in said Circuit Court of Appeals by filing "Commerce among the several states or with in the court a written petition praying that foreign nations, or in any territory of the the order of the commission be set aside. A United States or in the District of Columbia, copy of such petition shall be forthwith served or between any such territory and another, or upon the commission, and thereupon the combetween any such territory and any state or mission forthwith shall certify and file in the foreign nation or between the District of Co-court a transcript of the record as hereinbefore lumbia and any state or territory or foreign provided. Upon the filing of the transcript the court shall have the same jurisdiction to affirm, set aside, or modify the order of the commission as in the case of an application by the #424 nation." Messrs. Huston Thompson, of Washington, D. C., Alexander C. King, of Atlanta, Ga., and Claude R. Porter, of Washington, D. C., for petitioner. poration to cease and desist from using such method of competition." Mr. Thomas F. Magner, of Brooklyn, N. Y., for respondents. *422 *Mr. Justice McREYNOLDS delivered the opinion of the Court. By an act approved September 26, 1914 (chapter 311, 38 Stat. 717 [Comp. St. 88 8836a-8836k]), Congress made provision for the Federal Trade Commission and declared its powers. Section 4 (section 8836d) defines com Section 5 further provides that the commission may apply to the designated Circuit Court of Appeals to enforce an order Section 5 (section 8836e): "That unfair methods of competition in commerce are hereby declared unlawful. The commission is hereby empowered and directed to prevent persons, partnerships, or corporations, except banks, and common carriers subject to the acts to regulate commerce, from using unfair methods of competition in comSections 6 and 7 (sections 8836f, 8836g) emmerce. Whenever the commission shall have power the commission to require reports and reason to believe that any such person, part- compile information concerning corporations; nership, or corporation, has been or is using to inquire concerning execution of decrees reany unfair method of competition in commerce, straining violations of the anti-trust acts; and if it shall appear to the commission that to investigate alleged violations of such acts; a proceeding by it in respect thereof would be to recommend readjustments of corporate to the interest of the public, it shall issue and business; to publish information and make serve upon such person, partnership, or corporation a complaint stating its charges in that reports to Congress; to classify corporations respect, and containing a notice of a hearing and make rules and regulations; to investiupon a day and at a place therein fixed at least gate trade conditions; to act, under orders thirty days after the service of said complaint. of the court, as a master in chancery in cerThe person, partnership, or corporation so com-tain designated circumstances, etc. plained of shall have the right to appear at the Undertaking to proceed under section 5, place and time so fixed and show cause why June 4, 1917, the commission issued a coman order should not be entered by the complaint containing two counts against respondmission requiring such person, partnership, or corporation to cease and desist from the violation of the law so charged in said complaint. ** If upon such hearing the commission shall be of the opinion that the method of com$423 2 ents. The first related to unfair methods of petition in question is prohibited by this act, N commission for an *enforcement of its order, and the findings of the commission as to the facts, if supported by testimony, shall in like manner be conclusive." "their officers and agents, cease and desist from | cotton, and which jute bagging is manufactured requiring purchasers of cotton ties to also buy by the American Manufacturing Company, of or agree to buy, a proportionate amount of St. Louis, Missouri. American Manufacturing Company's bagging and further that the respondents cease and desist from refusing to sell cotton ties unless the purchasers buy or agree to buy from them corresponding amounts of American Manufacturing Company's bagging, or any amount of cotton bagging of any kind." The challenged order is based solely upon the first count of the complaint which fol lows: "Paragraph 2: That the respondents P. P. Williams, W. H. Fitzhugh, and Alex. Fitzhugh are copartners doing business under the firm name and style of P. P. Williams & Co., having their principal office and place of business in the city of Vicksburg and state of Mississippi, and the said last-named respondents and the said respondent Charles O. Elmer, who is located and doing business at the city of New Orleans and state of Louisiana, are the selling and distributing agents of the said firm of Warren, Jones & Gratz, and sell and distribute the ties and bagging, manufactured as aforesaid, in interstate commerce, principally to jobbers and dealers, who resell the same to retailers, cotton ginners, and farmers. "Paragraph 3: That with the purpose, intent, and effect of discouraging and stifling competition in interstate commerce in the sale of such bagging, all of the respondents do now refuse, and for more than a year last past have refused, to sell any of such ties unless the prothem bagging to be used with the number of spective purchaser thereof would also buy from ties proposed to be bought; that is to say, for each six of such ties proposed to be bought from the respondents the prospective purchaser is required to buy six yards of such bagging." "Federal Trade Commission v. Anderson Gratz and Benjamin Gratz, Copartners Doing Business under the Firm Name and Style of Warren, Jones & Gratz, P. P. Williams, It is unnecessary now to discuss conflict W. H. Fitzhugh, and Alex. Fitzhugh, Copartners Doing Business under the Firming views concerning validity and meaning Name and Style of P. P. Williams & Co., and of the act creating the commission and effect Charles O. Elmer. #427 ticing "unfair methods of competition in commerce" within the fair intendment of those words. We go no further and confine this opinion to the point specified. of the evidence presented. The *judgment "The Federal Trade Commission having rea- below must be affirmed, since, in our opinion, son to believe, from a preliminary investiga- the first count of the complaint is wholly intion made by it, that Anderson Gratz and Ben-sufficient to charge respondents with prac jamin Gratz, copartners doing business under the firm name and style of Warren, Jones & Gratz, P. P. Williams, W. H. Fitzhugh, and Alex. Fitzhugh, copartners doing business under the firm name and style of P. P. Williams & Co., and Charles O. Elmer, all of whom are hereinafter referred to as respondents, have been and are using unfair methods of competition in interstate commerce in violation of the provisions of section 5 of the act of Congress approved September 26, 1914, entitled 'An act to create a Federal Trade Commission, to define its powers and duties, and for other purposes,' and it appearing that a proceeding by it in respect thereof would be to the interest of the public, issues this complaint, stating its charges in that respect, on information and belief, as follows: "I. When proceeding under section 5 it is essential, first, that, having reason to believe a person, partnership, or corporation has used an unfair method of competition in commerce, the commission shall conclude a proceeding "in respect thereof would be to the interest of the public"; next, that it formulate and serve a complaint stating the charges "in that respect," and give opportunity to the accused to show why an order should not issue directing him to "cease and desist from the violation of the law so charged in said complaint." If after a hear"Paragraph 1: That the respondents Ander-ing the commission shall deem "the method son Gratz and Benjamin Gratz are copartners of competition in question is prohibited by doing business under the firm name and style this act," it shall issue an order requiring of Warren, Jones & Gratz, having their princi- the accused "to cease and desist from using pal office and place of business in the city of such method of competition." St. Louis and state of Missouri, and are engaged in the business of selling, in interstate commerce, either directly to the trade, or through the respondents hereinafter named, steel ties made and used for binding bales of cotton, and which steel ties are manufactured by the Carnegie Steel Company of Pittsburgh, Pennsylvania, and also selling, in the same manner, jute bagging, used to wrap bales of $426 [1, 2] If, when liberally construed, the complaint is plainly insufficient to show unfair competition within the proper meaning of these words there is no foundation for an order to desist-the thing which may be prohibited is the method of competition specified in the complaint. Such an order should follow the complaint; otherwise it is improvi (40 Sup.Ct.) dent and, when challenged, will be annulled | show any unfair method of competition prac- The judgment of the court below is [3, 4] The words "unfair method of competition" are not defined by the statute and their exact meaning is in dispute. It is for the courts, not the commission, ultimately to determine as matter of law what they include. They are clearly inapplicable to practices never heretofore regarded as opMr. Justice BRANDEIS dissenting, with posed to good morals because characterized | whom Mr. Justice CLARKE concurs. by deception, bad faith, fraud, or oppression, or as against public policy because of their dangerous tendency unduly to hinder compe First. The court disposes of the case on a question of pleading. This, under the circumstances, is contrary to established practice. The circumstances are these: Mr. Justice PITNEY concurs in the result. *428 tition or create monopoly. The act was *certainly not intended to fetter free and fair the court. The pleading held defective is not one in competition as commonly understood and this suit. It is the pleading by which was practiced by honorable opponents in trade. originated the proceeding before the Federal [5] Count 1 alleges, in effect: That War- Trade Commission, an administrative triburen, Jones & Gratz are engaged in selling, nal, whose order this suit was brought to set either directly to the trade or through their aside. No suggestion was made in the procorrespondents, cotton ties produced by the ceeding before the commission that the comCarnegie Steel Company and also jute bag-plaint was defective. No such objection was ging manufactured by the American Manu- raised in this suit in the court below. It facturing Company. That P. P. Williams & was not made here by counsel. The objecCo., of Vicksburg, and C. O. Elmer, of New tion is taken now for the first time and by Orleans, are the selling and distributing agents of Warren, Jones & Gratz, and as such sell and distribute their ties and bag-peals for the Second Circuit, was brought to ging to jobbers and dealers, who resell them set aside an order of the Federal Trade Commission. Before the latter the matter into retailers, ginners, and farmers. That with the purpose and effect of discouraging and stifling competition in the sale of such bagging all the respondents for more than a year have refused to sell any of such ties unless the purchaser would buy from them a corresponding amount of bagging-six yards with as many ties. This suit, begun in the Circuit Court of Ap The complaint contains no intimation that Warren, Jones & Gratz did not properly obtain their ties and bagging as merchants usually do; the amount controlled by them is not stated; nor is it alleged that they held a monopoly of either ties or bagging or had ability, purpose or intent to acquire one. So far as appears, acting independently, they undertook to sell their lawfully acquired property in the ordinary course, without deception, misrepresentation, or oppression, and at fair prices, to purchasers willing to take it upon terms openly announced. [6] Nothing is alleged which would justify the conclusion that the public suffered injury or that competitors had reasonable ground for complaint. All question of monopoly or combination being out of the way, a private merchant, acting with entire good faith, may properly refuse to sell, except in conjunction, such closely associated articles as ties and bagging. If real competition is to continue, the right of the individual to *429 exercise reasonable discretion *in respect of his own business methods must be preserved. United States v. Colgate, 250 U. S. 300, 39 Sup. Ct. 465, 63 L. Ed. 992; United States v. A. Schrader's Son, Inc. (March 1, 1920), 252 U. S. 85, 40 Sup. Ct. 251, 64 L. Ed. 471. The first count of the complaint fails to Thir Volved was thoroughly tried on the merits. *430 more than 16 months. The report of them fills 400 pages of the printed record. In my opinion it is our duty to determine whether the facts found by the commission are sufficient in law to support the order, and also, if it is questioned, whether the evidence was sufficient to support the findings of fact. Second. If the sufficiency of the complaint is held to be open for consideration here, we should, in my opinion, hold it to be sufficient. The complaint was filed under section 5 of the Federal Trade Commission Act which declares unlawful "unfair methods of compe sion to prevent their use, and directs it to tition in commerce," empowers the commisissue and serve "a complaint stating its charges in that respect" whenever it has reason to believe that a concern "has been or is using" such methods. The function of the complaint is solely to advise the respondent of the charges made so that he may have due notice and full opportunity for a hearing thereon. It does not purport to set out the elements of a crime like an indictment or information, nor the elements of a cause of action like a declaration at law or a bill in equity. All that is requisite in a complaint $432 before the commission is that there be a plain statement of the thing claimed to be wrong so that the respondent may be put upon his defence. The practice of the Federal Trade Commission in this respect, as in many others, is modeled on that which has been pursued by the Interstate Commerce Commission for a generation and has been sanctioned by this as well as the lower federal courts. United States Leather Co. v. *In considering whether the complaint is sufficient, it is necessary to bear in mind the nature of the proceeding under review. The proceeding is not punitive. The complaint is not made with a view to subjecting the respondents to any form of punishment. It is not remedial. The complaint is not filed with a view to affording compensation for any injury alleged to have resulted from the matter charged, nor with a view to protecting individuals from any such injury in the future. The proceeding is strictly a pre Southern Ry. Co., 21 Interst. Com. Com'n R. 323, 324; Clinton Sugar Refining Co. v. C. & N. W. Ry. Co., 28 Interst. Com. Com'n R. 364, 367; Stuarts Draft Milling Co. v. South-ventive measure taken in the interest of the general public. And what it is brought to prevent is not the commission of acts of unfair competition, but the pursuit of unfair methods. Furthermore, the order is not selfexecutory. Standing alone it is only informative and advisory. The commission cannot enforce it. If not acquiesced in by the respondents, the commission may apply to ern Ry. Co., 31 Interst. Com. Com'n R. 623, 624; New York Central, etc., R. R. Co. v. Interstate Commerce Commission (C. C.) 168 Fed. 131, 138, 139; Dickerson v. Louisville & Nashville R. R. Co. (C. C.) 187 Fed. 874, 878; Texas & Pacific Ry. v. Interstate Com #431 merce Commission, 162 *U. S. 197, 215, 16 Sup. Ct. 666, 40 L. Ed. 940; Cincinnati, Hamilton | the Circuit Court of Appeals to enforce it. & Dayton Ry. Co. v. Interstate Commerce | But the commission need not take such acCommission, 206 U. S. 142, 149, 27 Sup. Ct. tion, and it did not do so in respect to the 648, 51 L. Ed. 995. order here in question. Respondents may, if they see fit, become the actors and ask to have the order set aside. That is what was done in the case at bar. The complaint here under consideration stated clearly that an unfair method of competition had been used by respondents, and specified what it was, namely, refusing to sell cotton ties unless the customer would purchase with each six ties also six yards of bagging. The complaint did not set out the circumstances which rendered this tying of bagging to ties an unfair practice. But this was not necessary. The complaint was similar in form to those filed with the Interstate Commerce Commission on complaints to enforce the prohibition of "unjust and unreasonable charges" or of "undue or unreasonable preference or advantage" which the act to regulate commerce imposes (Comp. St. § 8565). It is unnecessary to set forth why the rate specified was unjust or why the preference specified is undue or unreasonable, because these are matters not of law but of fact to be established by the evidence. Pennsylvania Co. v. United States, 236 U. S. 351, 361, 35 Sup. Ct. 370, 59 L. Ed. 616. So far as appears neither this nor any other court has ever held that an order entered by the Interstate Commerce Commission may be set aside as void, because the complaint by which the proceeding was initiated, failed to set forth the reasons why the rate or the practice complained of was unjust or unreasonable; and I cannot see why a different rule should be applied to orders of the Federal Trade Commission issued under section 5.1 1 See Report Senate Committee on Interstate Commerce, June 13, 1914, Sixty-Third Congress, Second Session, No. 597, p. 13: : "It is believed that the term 'unfair competition' has a legal significance which can be enforced by the corumission and the courts, and that it is no more difficult to determine what is unfair competition than it is to determine what is a reasonable rate or what is an unjust discrimination. The committee was of the opin The proceeding is thus a novelty. It is a new device in administrative machinery, introduced by Congress in the year 1914, in the hope thereby of remedying conditions in business which a great majority of the American people regarded as menancing the general welfare, and which for more than a generation they had vainly attempted to remedy by the ordinary processes of law. It was believed that widespread and growing concentration in industry and commerce restrained trade, and that monopolies were acquiring increasing control of business. Legislation designed to arrest the movement and to secure disintegration of existing combinations had been enacted by some of the states as early as 1889. In 1890 Congress passed the Sherman Law (Comp. St. §§ 8820-8823, 8827-8830). *433 It was followed by much legislation in the states2 and many official investigations. Between 1906 and 1913 reports were made by the Federal Bureau of Corporations of its investigations into the petroleum industry, the tobacco industry, the steel industry, and the farm implement industry. A special committee of Congress investigated the affairs of the United States Steel Corporation. And in 1911 this court rendered its decision in Standard ion that it would be better to put in a general provision condemning unfair competition than to attempt to define the numerous unfair practices, such as local price cutting, interlocking directorates, and holding companies intended to restrain substantial competition." 2 See Laws on Trusts and Monopolies, Compiled under direction of the Clerk of the House Committee on the Judiciary, Sixty-Third Congress, by Nathan B. Williams, Revised January 10, 1914; also Trust Laws and Unfair Competition (Federal) Bureau of Corporations, March 15, 1915. |
0 Κριτικές Οι αξιολογήσεις δεν επαληθεύονται, αλλά η Google ελέγχει και καταργεί ψευδές περιεχόμενο όταν το εντοπίζει Σύνταξη κριτικής |