Page images
PDF
EPUB

470

Opinion of the Court.

Commission held that there was insufficient evidence in the record to establish discrimination among wholesalers, as such. Ruberoid contends that the order should have been similarly limited to sales to retailers and applicators. But there was ample evidence that Ruberoid's classification of its customers did not follow real functional differences. Thus some purchasers which Ruberoid designated as "wholesalers" and to which Ruberoid allowed extra discounts in fact competed with other purchasers as applicators. And the Commission found that some purchasers operated as both wholesalers and applicators. So finding, the Commission disregarded these ambiguous labels, which might be used to cloak discriminatory discounts to favored customers, and stated its order in terms of "purchasers who in fact compete." Thus stated, we think the order is understandable, reasonably related to the facts shown by the evidence, and within the broad discretion which the Commission possesses in determining remedies.

Finally, Ruberoid complains that the order enjoins lawful acts by failing to except from its prohibitions differentials which merely make allowance for differences in cost of manufacture, sale or delivery, or which are made in good faith to meet an equally low price of a competitor. Differences in price satisfying either of these tests are permitted by the terms of the Act. It is argued that the Commission has radically broadened its prohibitory

9"[N]othing herein contained shall prevent differentials which make only due allowance for differences in the cost of manufacture, sale, or delivery resulting from the differing methods or quantities in which such commodities are to such purchasers sold or delivered..." 49 Stat. 1526, 15 U. S. C. § 13 (a). "[N]othing herein. contained shall prevent a seller rebutting the prima-facie case thus made by showing that his lower price . . . was made in good faith to meet an equally low price of a competitor . . . ." 49 Stat. 1526, 15 U. S. C. § 13 (b), Standard Oil Co. v. Federal Trade Comm'n, 340 U. S. 231 (1951). Ruberoid does not complain of the omission

Opinion of the Court.

343 U.S.

powers through failure to include these provisos in the order. We do not think so because we think the provisos are necessarily implicit in every order issued under the authority of the Act, just as if the order set them out in extenso. Although previous Commission orders have included these provisos, they gained no force by that inclusion. Their absence cannot preclude the seller from differentiating in price in a new competitive situation involving different circumstances where it can justify the discrimination in accordance with the statutory provisos. Nor is the seller required to seek modification of the order each time, for example, that a competitor's price reduction requires it either to lower its price in good faith to meet the lower competing price or to lose a fleeting sales opportunity. On the other hand, the implied inclusion of the provisos in the order does not shift from the seller the burden of proof of justification.10 Neither does recognition of the implicit availability of these defenses allow the seller to relitigate issues already settled by prior proceedings before the Commission which resulted in an order that was affirmed in the courts. If questions of justification, claimed upon the basis of facts relating to costs or meeting competition, have once been finally decided against the seller, it cannot again interpose the same defense upon substantially similar facts when the Commission seeks to show that its order has been violated."

from the order of the statutory provisos relating to the seller's right to select its own customers and to price changes in response to changing conditions affecting the market for, or the marketability of, the goods concerned. Hence we do not deal with those defenses here.

10 Cf. Federal Trade Comm'n v. Morton Salt Co., 334 U. S. 37, 44-45 (1948) (cost justification); Federal Trade Commʼn v. A. E. Staley Mfg. Co., 324 U. S. 746 (1945) (meeting-competition justification).

11 Where the Commission seeks both affirmance and enforcement of its order in one proceeding, contending that the seller has con

470

Opinion of the Court.

The same result follows where the evidence supporting the defense, although not produced in the previous proceedings, was then available to the seller. In short, the seller, in contesting enforcement or contempt proceedings, may plead only those facts constituting statutory justification which it has not had a previous opportunity to present.

The sole question presented by the Commission's petition concerns the lower court's holding, with one dissent, that the Commission could not "obtain a decree directing enforcement of an order issued under the Clayton Act in the absence of showing that a violation of the order has occurred or is imminent." 12 The pertinent parts of the Act provide:

"If such person [subject to the order] fails or neglects to obey such order of the commission . . . while the same is in effect, the commission .

may ap

ply to the circuit court of appeals of the United
States . . . for the enforcement of its order ...
[T]he court. . . shall have power to make and
enter. . . a decree affirming, modifying, or setting
aside the order of the commission . . .

"Any party required by such order of the commission . . . to cease and desist from a violation charged may obtain a review of such order in said circuit court of appeals by filing in the court a written petition praying that the order of the commission . . . be set aside. . . . [T]he court shall have the same jurisdiction to affirm, set aside, or modify the order of the commission . . . as in the case of an applica

tinued in its unlawful practices since the order was issued, the court, in deciding whether the order should be affirmed, will of course review the determination of the Commission in the ordinary manner. But questions thus settled will not be open in deciding whether the order has been violated and should therefore be enforced.

12 191 F. 2d 294, 295.

Opinion of the Court.

343 U.S.

tion by the commission . . . for the enforcement of its order.

"The jurisdiction of the circuit court of appeals of the United States to enforce, set aside, or modify orders of the commission . . . shall be exclusive." 13 The Commission argues, first, that the provision authorizing it to apply for enforcement "if such person fails or neglects to obey such order" is merely "a Congressional directive to the Commission as to the circumstances under which it may go into court to seek enforcement," which does not amount to a prerequisite to the court's granting of enforcement." We cannot subscribe to this argument, which disregards the unequivocal language of the statute and its consistent interpretation over the thirty-eight-year period of its existence.15 Congress, in 1938, amended similar language in the Federal Trade Commission Act, so that the reviewing court is now plainly required, upon affirmance, to enforce an order based upon violation of that Act.16 The Commission has

13 38 Stat. 735, as amended, 15 U. S. C. § 21.

14 Brief for the Federal Trade Commission in No. 448, p. 16.

15 E. g., Federal Trade Comm'n v. Whitney & Co., 192 F. 2d 746 (C. A. 9th Cir. 1951); Federal Trade Comm'n v. Standard Brands, Inc., 189 F. 2d 510 (C. A. 2d Cir. 1951); Federal Trade Comm'n v. Herzog, 150 F. 2d 450 (C. A. 2d Cir. 1945); Federal Trade Comm'n v. Baltimore Paint & Color Works, 41 F. 2d 474 (C. A. 4th Cir. 1930); Federal Trade Comm'n v. Balme, 23 F. 2d 615 (C. A. 2d Cir. 1928); Federal Trade Comm'n v. Standard Education Society, 14 F. 2d 947 (C. A. 7th Cir. 1926). The last three cases cited arose under the Federal Trade Commission Act, but since the Clayton Act provisions involved here are identical with the corresponding provisions of the Federal Trade Commission Act prior to 1938, 38 Stat. 720, the decisions make no distinction between them.

16 "To the extent that the order of the Commission is affirmed, the court shall thereupon issue its own order commanding obedience to the terms of such order of the Commission." 52 Stat. 113, 15 U. S. C. § 45 (c). Unless the party subject to an order issued under the

[ocr errors]

470

Opinion of the Court.

repeatedly sought similar amendment of the Clayton Act provisions involved in this case." We will not now achieve the same result by reinterpretation in the face of Congress' failure to pass the bills thus brought before it.18 Effective enforcement of the Clayton Act by the Commission may be handicapped by the present provisions, but that is a question of policy for Congress.

Alternatively, the Commission argues that, even though disobedience of the order is a condition to enforcement upon the application of the Commission, there is no such condition where the order comes before the court upon petition for review by the affected party. This argument begins with the difference in language between the statutory paragraphs providing for review at the instance of the respective parties, but consideration of the section as a whole convinces us that the most that can be said for the argument is that the section is ambiguous. We think the statutory prerequisite to enforcement applies when the Commission seeks enforcement by cross-petition after review has been set in motion by the party subject to the order as well as when the Commission makes the original application. There is no reason why one who has complied with the order, but who seeks to have it reviewed and modified or set aside, should be placed in a worse position than one who does not exercise that right.

19

We

provisions of the Federal Trade Commission Act files a petition for review within sixty days, the order becomes final and its violation punishable. 52 Stat. 113-114, 15 U. S. C. § 45 (g) and (l).

17 E. g., Ann. Rep. F. T. C. (1951) 7–8; Ann. Rep. F. T. C. (1948) 12; Ann. Rep. F. T. C. (1947) 13; Ann. Rep. F. T. C. (1946) 12. 18 E. g., H. R. 10176, 75th Cong., 3d Sess.; H. R. 3402, 81st Cong., 1st Sess.

19 Accord, e. g., Federal Trade Comm'n v. Fairyfoot Products Co., 94 F. 2d 844 (C. A. 7th Cir. 1938); Butterick Co. v. Federal Trade Comm'n, 4 F. 2d 910 (C. A. 2d Cir. 1925); L. B. Silver Co. v. Federal Trade Comm'n, 292 F. 752 (C. A. 6th Cir. 1923).

« PreviousContinue »