Legal Document

352 U.S. 419 77 Supreme Court Reporter 502 1 United States Reports Lawyer’s Edition 2d Series KF101.8 U54 438 FEDERAL TRADE COMMISSION, Petitioner,v.NATIONAL LEAD COMPANY et al. Number 63. Argued Dec. 12, 1956. Decided Feb. 25, 1957. Mr. Earl W. Kintner, Washington, D.C., for the petitioner. Eugene Z. Du Bose, New York City, respondent. Justice CLARK delivered opinion of Court. The sole question involved in this proceeding under § 5 Federal Trade Commission Act1 concerns power framing an order pursuant to its finding that respondents had conspired adopt and use a zone pricing system their sale lead pigments.2 In general cease desist prohibiting concert action among further such system, inserted provision directing each respondent individually from adopting same or similar purpose with effect 'matching' prices competitors. assert is beyond Commission, Appeals agreed, 7 Cir., 227 Reporter, 2nd 825, striking Commission's order. We granted certiorari, 351 961, 76 1026, 100 L.Ed. 1482, because importance administration Act. restore stricken order, permitting it stand interpretations placed upon opinion. I. 2 original Act was commenced 1944. entered on second amended complaint filed 1946. After protracted hearings, findings which has held be supported by substantial evidence. material here are as follows: 3 practice industry white oil prior 1933 not shown record. However, National Lead early 1910 sold pigment basis territorial differentials involving free freight specified towns. added base price were generally uniform some 589 cities listed Lead's 1933. charge purchasers outside plus actual nearest city. sales dry oxides appears there case lead, while paid addition price. 4 Beginning July 1933, series meetings Chicago ostensible drafting code fair competition govern Industrial Recovery Act, 48 Statutes-at-Large 195. These resulted understanding agreement those attending, including respondents, sell pigments 'on flat customers within designated zones, applicable between zones . ..' 49 F.T.C. 840. Four zoning systems established covering various pigments. As example, 'keg' products consisted 12 geographical one known par zone. remaining premium being determined adding set premiums varied $.125 per cwt. two high $1 State Mexico.3 highly artificial boundaries led bizarre results at times, located near plants charged higher than distance plants. industry, only agreed identical but also adopted discounts, terms sale, respect certain products. A consignment contracts. stated 'nowhere code, nor any preliminary draft produced committees, reference differences pigments, agency contracts arrangements lead-in-oil.' Id., 839. 'with exceptions, have followed practices adhered conditions 1934 herein found present time.' 849. admit they bound these we see no reason disturb them. II. 6 entering into carrying out 'planned common course action,' agreement, conspiracy 'zone system,' other resulting points sale. included provision, strenuously object, them 'quoting selling calculated whole part accordance systematically matching quotations sellers thereby preventing advantage dealing more against another.' 873—874. 8 accompanying opinion, all cases where violations law, 'it duty determine best ability remedy necessary suppress activity take every precaution preclude revival.' 884. case, pointed out, cooperatively revised establishing 'uniform system.' Detailed discussions carried 'maps showing observed * distributed' individual respondents. 884, Each 'since time so discussed maps.' Ibid. Discussing complaint, noted charges adherence 'for enabling match exactly offers prospective purchaser destination, eliminating themselves.' It made combination work. Unless until prohibited adhering using evils springing combination, eliminate competition, may well continue indefinitely. representing practically entire economic deprived device effective, merely useless gesture.' 884—885. view, added, 'prohibition necessary, unlawful circumstances seller, acting independently, territories, make fully effective trade restraining (defendants) participated.' When if restored prohibition longer expressed intention, application, vacate latter III. 9 At beginning must understand limits contested portion First, temporary. Though life expectancy definite, clear creating breathing spell during independent might without hang-over long-existing pattern collusion. Second, directed solely system4 other. This method based geographic devisions entirely drawn seller. His throughout particular up him. Customarily different though here, widely separated geographically, mention passed validity basing point sales, Corn Products Refining company versus 1945, 324 726, 65 89 1320, decided plan used here. Third, se banned specific definite period 'the very cornerstone conspiracy,' i.e., pricing. See Hartford-Empire States, 323 386, 428, 373, 394, 322, corporate defendants enjoined 'forming joining association' five years. But chose flexible sanction, limited concluded future should temporarily restricted protection public. And so, violates when present: (1) competitors, (2) Considering mechanics plan, way can competitors coincide overlap.5 10 Respondents contend written, excludes benefits 2(b) Clayton Act.6 While 'does concern itself (but) (with) seller's 'lower' extent 'in good faith meet equally low competitor," Atlantic E. Staley Mfg. Co., 746, 753, 971, 975, 1338, section read Ruberoid 1952, 343 470, 476, 72 800, 804, 96 1081. Since must, therefore, afforded section. IV. 11 contention paragraph effectively bans noncollusive, pricing, lawful, competitive method, therefore authority Commission. even exercise improper, unnecessary, would, fact, hamper industry. They stress did include unlawful; came after Trial Examiner his recommended decision order; denied opportunity rebutting evidence 'a logical, economical, doing business.' insertion objectionable paragraph, contend, due process defend. since would allow rebut charge, completely answered shall deal further. goes saying requirements hearing notice claims opposing party Morgan 1938, 304 1, 58 773, 82 1129. record indicates safeguards. emphasis evidence, support inclusion misplaced. Its nothing mode implementation, selected enforce Moreover, replete counsel supporting seek enforcement. far back 1947, before Examiner, issue concerning motions dismiss. Admittedly Count II dealt itself. overruled dismiss, view allegations effects alleged 'not instances' discrimination Furthermore, May 1948, almost years decree entered, written exceptions ground, others, objected If thought rebuttal bare effort offer it. Nor request reopen reached 13 pass respondents' major questioning said many times before, powers Western Meat 1926, 272 554, 559, 47 175, 177, 71 405. relevant sections empower prevent unfair methods authorize it, present, enter requiring offender 'to desist' method. 14 clothed wide discretion determining type bring end exist. jacob Siegel 1946, 327 608, 66 758, 90 888, named expert body what deceptive been disclosed. latitude judgment courts will interfere except reasonable relation exist.' pages 612 613, page 760. Thereafter, Cement Institute, 333 683, 68 793, 815, 92 1010, Congress, passing 'felt needed assistance men trained combat monopolistic judicial decrees antitrust litigation.' light this, reasoned, 'lightly modify' orders Again, supra, 473, 803, 'if attain objectives Congress envisioned, cannot required confine road block narrow lane transgressor traveled; allowed close roads goal, bypassed impunity.' primary responsibility fashioning question: Does 'reasonable exist'? believe does. simplicity operation lends manipulation; second, quarter century; and, third, originator chief beneficiary previously adjudged violator laws. 332 319, 67 1634, 91 2077. 15 plainly disregarded law. correctly considered illegal acts occurred. Those utter disregard 'call repression sterner measures steps could reasonably permissible.' Gypsum 1950, 340 76, 89—90, 160, 170, 95 89. appeal guilt. Having lost battle facts, hope win war decree. fight right weapon enterprise. permitted. obliged assume, contrary experience, laws relinquish fruits violation (it) requires *.' International Salt 392, 400, 17, 20. Although lawful purposes, often carry purpose. Ethyl Gasoline Corporation 1940, 309 436, 60 618, 84 852; Bausch & Lomb Optical 1944, 321 707, 64 805, 88 1024. instances revival practices. 461, 627; Local 167 I.B.T. etc. 1934, 291 293, 54 396, 78 804. supra; Crescent Amusement 173, 188, 254, 261, 160.7 conclude that, justified determination restraint corporations continuance Standard Education Society, 1937, 302 112, 120, 113, 117, 141. now examine imposed. 16 long history entered. say our restoration competition. supplemental memorandum, note 5, clearly scope conclusion intended does prohibit se. absorption foster said, seller lower competitor. plead defense system. designed protect transactions. 17 pose hypothetical situations rise plague 'we think administration,' late Brother Jackson 401, 20, strike conjectures. reserved jurisdiction just contingencies. arise presented evidentiary form rather fantasies. add, burden lighter application then remember caught violating expect fencing in. 187, 261. 18 Reversed. 38 719, amended, Code KF62 45, Annotated KF65 U5 45. three principal oil, oxides, red litharge. Dry fine powder paints. White linseed basic ingredient exterior house paint. litharge electric storage battery manufacturers raw plates. Red paint commonly protective coating iron steel structures. includes number northeastern midwestern States. excluded On hand, San Francisco area zone, City St. Louis, both areas. For detailed discussion maps findings, 840—870. Our construed approval use. do reach question. oral argument, requested submit statement behalf setting forth disputed response, supplied interpretation coincides 1526, 13(b), 13(b). need discuss full relative breadth comparison court equity. Department Stores Labor Relations Board, 326 376, 390, 203, 211, 145, 'The test whether Board

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