FED. TRADE COMM. v. KLESNER

MR. CHIEF JUSTICE TAFT delivered the opinion of the Court.

The question presented in this case is whether the Court of Appeals of the District of Columbia has, under the Federal Trade Commission Act, 38 Stat. 717, jurisdiction to enforce, set aside or modify orders of the Federal Trade Commission, entered against persons engaged in commerce within the District of Columbia, requiring them to cease and desist from the use of unfair methods of competition within the District.

The case, as made before the Commission, was as follows: Klesner, a resident of the District, was engaged, among other things, in the manufacture and sale of window shades in the District, doing business under the name and style of "Shade Shop." For some years prior to respondent's entry into this business, another establishment had been engaged exclusively in the window shade business under the same name and style, and had become well and favorably known to the purchasing public by that name. The charge heard before the Commission was that the respondent, by the use of the name "Shade Shop," was deceiving the purchasing public into the belief that his establishment was that of a prior long-established competitor, and by this means was causing people to deal with the respondent, in the belief that they were dealing with his competitor. Klesner answered, denying the charge. Evidence was received upon the issues joined, and after argument the Commission made its report upon the facts and issued an order requiring the respondent to cease and desist from doing business in the District of Columbia under the name of "Shade Shop." Klesner failed and refused to obey the order, and the Commission applied to the Court of Appeals of the District of Columbia for a decree of enforcement. That court, without considering the merits of the case, held that it was without jurisdiction in the premises, and dismissed the Commission's petition, June 1, 1925, in an opinion reported in 6 F.2d 701. A petition for certiorari was granted by this Court October 26, 1925, (269 U.S. 545) pursuant to § 240 (a) of the Judicial Code, as amended by the Act of February 13, 1925, c. 229, 43 Stat. 938.

The ground for the dismissal of this case by the Court of Appeals was that Congress, in the Trade Commission Act, had not given jurisdiction to the Court of Appeals of the District of Columbia over suits brought to enforce the order of the Commission as it had done in respect of such suits in the proper circuit courts of appeals. The pertinent part of the Federal Trade Commission Act bearing on this question we have set out in the margin.*

The Trade Commission Act was passed by Congress to prevent persons, partnerships or corporations from using unfair methods of competition in the commerce which Congress had the constitutional right to regulate. By § 4 of the Act, the commerce to be reached is defined as including not only commerce between the States, and with foreign nations and between the District of Columbia and any State or Territory or foreign nation, but also commerce within the District of Columbia. The statute is clear in its direction that the Commission shall make orders preventing persons engaged in the District from using the forbidden methods. Therefore the Commission was authorized to make the order which was made in this case. In § 9 of the Trade Commission Act, the Commission is given power to require by subpoena the attendance and testimony of witnesses and the production of documentary evidence relating to any matter under investigation. And this may be required from any place in the United States at any designated place of hearing, and in case of disobedience to a subpoena, the Commission may invoke the aid of any court of the United States in requiring such attendance and testimony. Any of the district courts of the United States within the jurisdiction of which such inquiry is carried on, may in case of contumacy or refusal to obey a subpoena issue an order requiring the presence of the person summoned, and a failure to obey the order may be punished by the district court as a contempt thereof. Upon application of the Attorney General, at the request of the Commission, the district courts shall have jurisdiction to issue writs of mandamus commanding any person to comply with the provisions of this Act or any order of the Commission made in pursuance thereof.

By § 61 of the Code of Laws for the District of Columbia, 31 Stat. 1199, the Supreme Court of the District is given the same powers and the same jurisdiction as district courts of the United States and is to be deemed a court of the United States, and shall exercise all the jurisdiction of one, and a special term of the court shall be a district court of the United States. The justices of the court are vested with the power and jurisdiction of judges of the district courts of the United States. Sections 62 and 84, Code of the District of Columbia, 1924. It follows that the Trade Commission could use the Supreme Court of the District to enforce the procedure needed on its part to take evidence and thus enable it to reach its conclusions, and in this could avail itself of the power of contempt of that court.

It has been the evident intention of Congress that laws generally applicable to enforcement of what may be called federal law in the United States generally should have the same effect within the District of Columbia as elsewhere. For this purpose the courts of the District of Columbia are federal courts of the United States. Keller v. Potomac Electric Company, 261 U.S. 428, 442. They are part of the federal judicial system. In Benson v. Henkel, 198 U.S. 1, this Court held that the Supreme Court of the District of Columbia was a Court of the United States and that the District of Columbia was a district within the meaning of Revised Statutes, § 1014, providing for the apprehension and holding persons for trial before such court of the United States. Where the Judicial Code provides that no writ of injunction shall be granted by any court of the United States to stay proceedings of any court of a State, with certain exceptions, the District Court of Appeals has held that the statute applied to the Supreme Court of the District of Columbia. Hyattsville Building Assn. v. Bouick, 44 D.C. App. 408. See also, United States v. B. & O.R.R., 26 D.C. App. 581; Arnstein v. United States, 296 Fed. 946, 948.

The question, therefore, which we have to answer is whether, when Congress gave the Commission power to make orders in the District of Columbia with the aid of the Supreme Court of the District in compelling the production of evidence by contempt or mandamus, it intended to leave the orders thus made, if defied, without any review or sanction by a reviewing court, though such review and sanction are expressly provided everywhere throughout the United States except in the District. We think this most unlikely, and, therefore, it is our duty, if possible in reason, to find in the Trade Commission Act ground for inference that Congress intended to refer to and treat the Court of Appeals of the District as one of the circuit courts of appeals referred to in the Act, to review and enforce such orders.

It is to be noted that the same question arises in the construction of the Clayton Act of October 15, 1914, c. 323, 38 Stat. 730. That Act applies, as this one does, to commerce in the District, as well as between States, and with foreign nations. By its second section it forbids difference in prices to purchasers in order to lessen competition. In the third section it makes it unlawful to lease or make and sell goods patented or unpatented or fix a price thereon with the condition that the lessee or purchaser shall not use the goods or wares of competitors, where such a provision shall lessen competition. By § 7, corporations are forbidden to acquire stock of another to lessen competition, and by § 8 there is a restriction upon interlocking directorates in two or more competing corporations applicable to banking associations and other corporations. Section 11 provides that authority to enforce compliance with the sections just referred to is vested in the Interstate Commerce Commission where applicable to common carriers, in the Federal Reserve Board where applicable to banks, and in the Federal Trade Commission where applicable to all the other characters of commerce. The orders of these bodies are to be made upon hearings similar to those provided for in the Federal Trade Commission Act, and the circuit courts of appeals are to review and enforce the orders. The existence of two such Acts itself enforces the inference that Congress thought that the term "Circuit Court of Appeals" was sufficient to include the appellate court of the District of Columbia.

The Court of Appeals of the District of Columbia was created by an Act of Congress approved February 9, 1893, 27 Stat. 434, which conferred upon it appellate jurisdiction over the Supreme Court of the District of Columbia. Section 7 of the Act provides that any party aggrieved by any final order, judgment or decree of the Supreme Court of the District, or of any justice thereof, may appeal therefrom to the Court of Appeals thereby created, which upon such appeal shall review such order, judgment or decree and affirm, reverse or modify the same as shall be just. This was a substitution of the Court of Appeals for the general term of the Supreme Court, which latter court was abolished by the Act. The parallelism between the Supreme Court of the District and the Court of Appeals of the District, on the one hand, and the district courts of the United States and the circuit courts of appeals, on the other, in the consideration and disposition of cases involving what among the States would be regarded as within federal jurisdiction, is complete.

A question similar to the one we have here was presented in the case of the Steamer Coquitlam v. United States, 163 U.S. 346. The United States in that case brought a suit in admiralty for the forfeiture of the steamer Coquitlam, because of an alleged violation of the revenue laws of the United States, in the District Court of Alaska, and, a decree having been rendered for the United States, an appeal was prosecuted to the Circuit Court of Appeals for the Ninth Circuit. Under the 15th section of the Act creating the circuit courts of appeals, 26 Stat. 826, 830, the circuit courts of appeals in cases in which their judgments were made final by the Act, were given the same appellate jurisdiction by writ of error or appeals to review the judgments, orders and decrees of the Supreme Courts of the several territories as by the Act they might have to review the judgments, orders, and decrees of the district courts and circuit courts, and for that purpose the several territories were, by orders of the Supreme Court, to be made from time to time, to be assigned to particular circuits. 26 Stat. 826, 830. Now, in Alaska there was only one court, and it was called the District Court of Alaska, and it was contended that it was not a supreme court of the territory and, therefore, was not a court from which an appeal could be prosecuted to the Circuit Court of Appeals for the Ninth Circuit. By the Act of May 17, 1884, 23 Stat. 24, a civil government was provided for Alaska, to constitute a civil and judicial district, with the civil and judicial and criminal jurisdiction of district courts of the United States, and such other jurisdiction not inconsistent with the Act as might be established by law, and the general laws of Oregon, so far as the laws were applicable, were adopted. This Court held that, under the statutes, the Circuit Court of Appeals of the Ninth Circuit could not review the final judgments or decrees of the Alaska court in virtue of its appellate jurisdiction over the district and circuit courts mentioned in the Act of March 3, 1891, 26 Stat. 826, 830, but that, as Alaska was one of the territories of the United States and as the District Court established in Alaska was the court of last resort within the limits of the territory, it was in a very substantial sense the supreme court of that territory; that no reason could be suggested why a territory of the United States in which the court of last resort was called a supreme court should be assigned to some circuit established by Congress that did not apply with full force to the Territory of Alaska in which the court of last resort was designated as the District Court of Alaska. The Court, speaking by Mr. Justice Harlan, said (p. 352):

"Looking at the whole scope of the act of 1891, we do not doubt that Congress contemplated that the final orders and decrees of the courts of last resort in the organized Territories of the United States — by whatever name those courts were designated in legislative enactments — should be reviewed by the proper Circuit Court of Appeals, leaving to this court the assignment of the respective Territories among the existing circuits."

We think we may use the same liberality of construction in this case. We find here a court which by acts of Congress is to be treated as a district court of the United States, and we find here a court of appeals which by the terms of its creation is exercising reviewing power over all federal cases proceeding from that district court of the United States by appeal or writ of error, so that it is exercising exactly the same function as the circuit courts of appeals do with respect to the district courts within their respective territorial jurisdictions in the other parts of the United States. The services of this district court of the United States in the District of Columbia are to be availed of under the Trade Commission Act when necessary in compelling evidence by the express words of the Act. We must conclude that Congress, in making its provision for the use of the circuit courts of appeals, in reviewing the Commission's orders, intended to include within that description the Court of Appeals of the District of Columbia as the appellate tribunal to be charged with the same duty in the District. The law was to be enforced, and presumably with the same effectiveness, in the District of Columbia as elsewhere in the United States.

We do not think that the cases of Swift v. Hoover, 242 U.S. 107, and of Tefft, Weller & Company v. Munsuri, 222 U.S. 114, should lead us in this case to a different conclusion. They related to appeals direct to this Court in bankruptcy from a court in Porto Rico, and from the Supreme Court of the District respectively. With the heavy burden upon this Court, every direct review imposed on it was naturally viewed with critical care, and when it was sought to enlarge the jurisdiction of this Court by strained construction to include review of the numerous and small claims from courts of bankruptcy in such jurisdictions, it is not strange that the attempt failed. More than that, in those cases the bankruptcy proceedings were judicial proceedings with judicial judgments which could be enforced even if not reviewed. They were not left in the air without any sanction against a defiant litigant, as would be the result in the present case, were the view we have taken not to prevail.

The judgment of dismissal of the Court of Appeals of the District of Columbia is reversed and the cause remanded for further proceedings.

Reversed.