Source: https://www.legalcrystal.com/case/99080/american-airlines-inc-vs-north
Timestamp: 2018-02-19 22:25:10
Document Index: 496875455

Matched Legal Cases: ['§ 411', '§ 411', '§ 411', '§ 411', '§ 411', '§ 411', '§ 411', '§ 5', '§ 45', '§ 5', '§ 411', '§ 411', '§ 5', '§ 5', '§ 5', '§ 411', '§ 411', '§ 411', '§ 5', '§ 5', '§ 411', '§ 5', '§ 45', '§ 411', '§ 5']

American Airlines Inc Vs North American Airlines Inc - Citation 99080 - Court Judgment | LegalCrystal
American Airlines, Inc. Vs. North American Airlines, Inc. - Court Judgment
LegalCrystal Citation legalcrystal.com/99080
Case Number 351 U.S. 79
Appellant American Airlines, Inc.
Respondent North American Airlines, Inc.
american airlines, inc. v. north american airlines, inc. - 351 u.s. 79 (1956) u.s. supreme court american airlines, inc. v. north american airlines, inc., 351 u.s. 79 (1956) american airlines, inc. v. north american airlines, inc. no. 410 argued march 6-7, 1956 decided april 23, 1956 351 u.s. 79 certiorari to the united states court of appeals for the district of columbia circuit syllabus in a proceeding under § 411 of the civil aeronautics act, the civil aeronautics board found that respondent's use of the name "north american" in the air transportation industry, in which it competed with american airlines, had caused "substantial public confusion" by causing persons to check in at the wrong carrier, attempt to.....
American Airlines, Inc. v. North American Airlines, Inc. - 351 U.S. 79 (1956)
U.S. Supreme Court American Airlines, Inc. v. North American Airlines, Inc., 351 U.S. 79 (1956)
1. The Board applied criteria appropriate to a determination of whether a proceeding by it in this case would be in the "interest of the public," as required by § 411, and it had jurisdiction to inquire into the methods of competition presented here and to determine whether they constituted a violation of the Act. Pp. 351 U. S. 80 -85.
2. The Board's evidentiary findings concerned confusion of the type which can support a finding of violation of § 411. Pp. 351 U. S. 85 -86.
3. However, since this Court does not understand the Court of Appeals to have decided whether the Board's findings were supported by substantial evidence on the record as a whole, the case is remanded to that Court for further proceedings in the light of this opinion. P. 351 U. S. 86 .
On October 6, 1952, respondent applied for permission to continue use of its name, "North American Airlines." Petitioner, American Airlines, on October 17, 1952, filed a memorandum with the Board requesting denial of North American's application for the reasons, among others, that use of the name "North American" infringed upon its long established trade name, "American," and constituted an unfair method of competition in violation of § 411 of
Page 351 U. S. 81
the Act. The Board, as authorized by § 411, on its own motion, instituted an investigation and hearing into whether there was a violation of § 411 by North American. It consolidated with that proceeding an investigation and hearing into the matter of North American's application for change of name in its letter of registration. American was granted leave to intervene in the consolidated proceeding.
As we understand its opinion, the Court of Appeals set aside the order because the public interest in this proceeding was inadequate to justify exercise of the Board's jurisdiction under § 411. Although the court was critical of the finding of "substantial public confusion," it did not, on its disposition of the case, expressly disturb that or any other of the Board's findings. For the purposes of review here, we will accept the findings, and there is no cause
Page 351 U. S. 82
for this Court to review the evidence. Universal Camera Corp. v. Labor Board, 340 U. S. 474 , has no application in the present posture of the case before us. The questions then presented are whether confusion between the parties' trade names justified a proceeding by the Board to protect the public, and whether the kind of confusion found by the Board could support a conclusion of a violation of the statute by respondent.
If the Board finds that the carrier is so engaged, "it shall order such air carrier . . . to cease and desist from such practices or methods of competition." Section 411 was modeled closely after § 5 of the Federal Trade Commission Act, * which similarly prohibits "unfair methods of competition in commerce, and unfair or deceptive acts or practices" and provides for issuance of a complaint "if it shall appear to the Commission that a proceeding by it . . . would be to the interest of the public." 38 Stat. 719, as amended, 15 U.S.C. § 45. We may profitably look to judicial interpretation of § 5 as an aid in the resolution of the questions raised here under § 411.
Page 351 U. S. 83
It should be noted at the outset that a finding as to the "interest of the public" under both § 411 and § 5 is not a prerequisite to the issuance of a cease and desist order as such. Rather, consideration of the public interest is made a condition upon the assumption of jurisdiction by the agency to investigate trade practices and methods of competition and determine whether or not they are unfair. Thus, this Court has held that, under § 5, the Federal Trade Commission may not employ its powers to vindicate private rights, and that whether or not the facts, on complaint or as developed, show the public interest to be sufficiently "specific and substantial" to authorize a proceeding by the Commission is a question subject to judicial review. Federal Trade Commission v. Klesner, 280 U. S. 19 . See also Federal Trade Commission v. R. F. Keppel & Bro., Inc., 291 U. S. 304 ; Federal Trade Commission v. Royal Milling Co., 288 U. S. 212 .
In the Klesner case, two District of Columbia retailers, with a long history of acrimonious personal and business relations, were both operating stores called the "Shade Shop." This Court held that the public interest merely in resolving their private unfair competition dispute would not justify the Commission in issuing a complaint. The courts of law are open to competitors for the settlement of their private legal rights, one against the other. The Board, under a mandate from Congress, is charged with the protection of the public interest as affected by practices of carriers in the field of air transportation. In exercising our function of review of the Board's jurisdiction to protect the public interest by a proceeding which may be generated from facts also giving rise to a private dispute, we must take account of the significant differences between § 5 and § 411. Section 5 is concerned with purely private business enterprises which cover the full spectrum of economic activity. On the
Page 351 U. S. 84
". . . the record is convincing that the public interest requires this action in order to prevent further public confusion between respondent and intervenor due to similarity of names. The maintenance of high standards in dealing with the public is expected of common carriers, and the public has a right to be free of the inconveniences which flow from confusion between carriers engaging in the transportation of persons by air. The speed of air travel may well be diminished when passengers check in for flights with the wrong carrier, or attempt to retrieve baggage from the wrong carrier, or attempt to purchase transportation from the wrong carrier, or direct their inquiries to the wrong carrier. Friends, relatives, or business associates planning to meet passengers or seeking information on delayed arrivals are subject to annoyance or worse when confused as to the carrier involved. The proper handling of complaints from members of the public is impeded
Page 351 U. S. 85
by confusion as to the carrier to whom the complaint should be presented. The transportation itself may differ from what the confused purchaser had anticipated ( e.g., in terms of equipment), even though the time and place of arrival may be about the same. It is obvious that public confusion between air carriers operating between the same cities is adverse to the public interest. . . ."
It is argued that respondent's use of the name "North American" cannot amount to an unfair or deceptive practice or an unfair method of competition authorizing the Board's order within § 411. "Unfair or deceptive practices or unfair methods of competition," as used in § 411, are broader concepts than the common law idea of unfair competition. See Federal Trade Commission v. R. F. Keppel & Bro., Inc., supra; Federal Trade Commission v. Raladam Co., 283 U. S. 643 , 283 U. S. 648 . The section is concerned not with punishment of wrongdoing or protection of injured competitors, but rather with protection of the public interest. See Federal Trade Commission v. Klesner, supra, at 280 U. S. 27 -28.
Page 351 U. S. 86
The courts have held, in construing § 5 of the Trade Commission Act, that the use of a trade name that is similar to that of a competitor, which has the capacity to confuse, or deceive the public, may be prohibited by the Commission. Federal Trade Commission v. Algoma Lumber Co., 291 U. S. 67 ; Juvenile Shoe Co. v. Federal Trade Commission, 289 F. 57. And see Pep Boys -- Manny, Moe & Jack, Inc. v. Federal Trade Commission, 122 F.2d 158, where the confusing name was not that of any competitor. The Board found that respondent knowingly adopted a trade name that might well cause confusion. But it made no findings that the use of the name was intentionally deceptive or fraudulent, or that the competitor, American Airlines, was injured thereby. Such findings are not required of the Trade Commission under § 5, and there is no reason to require them of the Civil Aeronautics Board under § 411. Federal Trade Commission v. Algoma Lumber Co., supra, at 291 U. S. 81 ; Eugene Dietzgen Co. v. Federal Trade Commission, 142 F.2d 321, 327; D.D.D. Corp. v. Federal Trade Commission, 125 F.2d 679, 682; Gimbel Bros., Inc. v. Federal Trade Commission, 116 F.2d 578, 579; Federal Trade Commission v. Balme, 23 F.2d 615, 621. See also S.Rep. No. 221, 75th Cong., 1st Sess. 2.
Page 351 U. S. 87
"a serious sanction which necessarily involves disturbance and loss to the carrier: . . . The maintenance of high standards in dealing with the public is expected of common carriers, and the public has a right to be free of the inconveniences which flow from confusion between carriers engaging in the transportation of persons by air. The speed of air travel may well be diminished when passengers check in for flights with the wrong carrier, or attempt to retrieve baggage from the wrong carrier, or attempt to purchase transportation from the wrong carrier,
Page 351 U. S. 88
or direct their inquiries to the wrong carrier."
"Since American Airlines, Inc., carries approximately 5 1/2 million passengers each year over its system, I am not impressed with the fact that witnesses in this case (principally those employed by American Airlines itself) have testified that some confusion has existed between the services offered by American, on the one hand, and North American on the other. On the contrary, I would be greatly surprised (in view of the several million phone calls and other communications which American Airlines receives every year over and above those received from passengers which it actually carries) if there were not some demonstrable public confusion between American
Page 351 U. S. 89
Airlines and the respondent in this case."
The Court relies on the cases arising under § 5 of the Federal Trade Commission Act, 38 Stat. 719, as amended, 15 U.S.C. § 45. Federal Trade Commission v. Algoma Lumber Co., 291 U. S. 67 ; Juvenile Shoe Co. v. Federal Trade Commission, 289 F. 57; Pep Boys -- Manny, Moe & Jack, Inc. v. Federal Trade Commission, 122 F.2d 158. Those cases are quite different. In each, the Commission made more than a bald finding of "substantial public confusion." It found, in the Algoma Lumber case, that a substantial number of purchasers had been misled into buying something other than what they thought they were buying. 291 U.S. at 291 U. S. 72 . In the Juvenile Shoe case, the competitor took a name so similar ("Juvenile Shoe Corporation" and "Juvenile Shoe Company, Inc.") that confusion in the public mind was "inevitable." 289 F. at 58. And the Commission made a finding that the use of the word "Juvenile" caused confusion and led purchasers to believe that the goods of one company were the goods of the other company. Id., 289 F. at 59. In the Pep Boys case, the court approved the following test:
There are no similar findings in the instant case. There is no finding here that a passenger bought a North American ticket and flew North American under the mistaken belief that he was flying American. There is no finding that any passenger missed a plane because of the confusion. If passengers mistakenly bought North American service, believing it to be American, a finding of unfair or deceptive practices or unfair methods of competition under § 411 would be justified. That is a type of public
Page 351 U. S. 90
confusion quite different from the confusion found in this case -- reporting to the wrong ticket counter or attempting to retrieve baggage from the wrong carrier. By analogy to the § 5 cases, we have here a situation where a few prospective purchasers walked into the wrong store, but never made any purchases there.