Holland Furnace Company v. FTC

Citation295 F.2d 302
Decision Date11 October 1961
Docket NumberNo. 12451.,12451.
PartiesHOLLAND FURNACE COMPANY, Petitioner, v. FEDERAL TRADE COMMISSION, Respondent.
CourtUnited States Courts of Appeals. United States Court of Appeals (7th Circuit)

Stuart S. Ball, Chicago, Ill., Robert H. Trenkamp, Cleveland, Ohio, Edward A. McLeod, Malcolm C. Douglas, Cleveland, Ohio (Trenkamp & Bovington, Cleveland, Ohio, Sidley, Austin, Burgess & Smith, Chicago Ill., of counsel), for petitioner.

James E. Corkey, Asst. Gen. Counsel, E. K. Elkins, Atty., Federal Trade Commission, Pgad B. Morehouse, Acting Gen. Counsel, Alan B. Hobbes, Asst. Gen. Counsel, Miles J. Brown, Atty., Federal Trade Commission, Washington, D. C., for respondent.

Before DUFFY, CASTLE and KILEY, Circuit Judges.

DUFFY, Circuit Judge.

This is a petition by Holland Furnace Company for a review of an order of the Federal Trade Commission dated July 7, 1958, which directs Holland to cease and desist from certain practices in commerce found to be unfair and deceptive.

Holland's main office for manufacturing facilities is located in Holland, Michigan. It operates in forty-four states and has 475 branch and sub-branch offices. Holland has a field organization of approximately 5000 employees. Its business is the sale and installation of warm air furnaces. Holland claims a large part of its business is the replacement of warm air heating equipment which is no longer serviceable or which has become obsolete.

Salesmen or house-to-house canvassers sell Holland's products, the gross annual sales totaling at least $30 million. All sales are to the ultimate purchasers and the users of the equipment. Holland does not ship furnaces as units to its warehouses, but sends out quantities of essential parts.

After nearly two years of hearings, the hearing examiner rendered his initial decision. Petitioner appealed therefrom to the Commission, and on July 7, 1958, the Commission handed down its decision and opinion in which it denied the appeal and adopted the examiner's initial decision and proposed order.

The final order, in substance, directed that Holland and its agents, representatives and employees cease and desist from 1) representing that its employees are inspectors or employees of governmental agencies or of gas or utility companies; 2) representing contrary to fact that its salesmen are heating engineers; 3) representing that furnaces manufactured by competitors are defective and not repairable and likely to result in fires or asphyxiation unless such are the facts; 4) tearing down or dismantling any furnace without the permission of the owner; 5) representing that a furnace which had been dismantled cannot be reassembled or used without danger of asphyxiation and fires etc., when such is not the fact; 6) requiring the owner of any furnace which has been dismantled by Holland's employees to sign a release absolving Holland of liability before reassembling such furnace; 7) refusing to immediately reassemble at the request of the owner any furnace which has been dismantled by Holland's employees; and 8) misrepresenting in any manner the condition of any furnace which has been dismantled by Holland's employees.

One aspect of this case was before us previously. After Holland had filed its petition for review by this Court on November 25, 1958, it filed a motion seeking determination of the jurisdictional issues raised in its petition for review in advance of a hearing on the merits. This Court granted that motion. Thereafter, briefs were filed and oral argument was held. On June 16, 1959, this Court denied petitioner's motion to vacate the order of the Commission on jurisdictional grounds. Holland Furnace Company v. Federal Trade Commission, 7 Cir., 269 F.2d 203. We held the Commission did have jurisdiction stating (269 F.2d 209), "* * * We hold as did the Commission that the acts, representations and conduct of Holland's employees in selling and distributing Holland's furnaces and parts, whether before or after such products had been warehoused in the state where sold and distributed, were in commerce within the meaning of the Federal Trade Commission Act 15 U.S.C.A. § 41 et seq.. * * *" We also said, at page 210, "* * * Under such facts the temporary warehousing of the products in each separate state in Holland's own warehouses is but an incident in its interstate business. The work of Holland's salesmen and servicemen create and are an essential part of Holland's vast interstate business and therefore is in commerce and subject to the regulative powers of the Commission."

Holland petitioned the Supreme Court of the United States for a writ of certiorari but this petition was denied (361 U.S. 932, 80 S.Ct. 369, 4 L.Ed.2d 353).

On this appeal, Holland is attempting to again litigate the question of jurisdiction. The excuse offered is that when the case was here previously, we did not have before us the entire record; that the hearing examiner had concluded that sales made from Holland branches in one state to customers located in an adjoining state were sufficient to bring the acts and practices complained of, in interstate commerce. Holland argues there is evidence of only a few sales across state lines, and that the acts and practices of Holland's employees...

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7 cases
  • Cheff v. Schnackenberg
    • United States
    • United States Supreme Court
    • June 6, 1966
    ...to enter its cease-and-desist order, Holland Furnace Co. v. F.T.C., 7 Cir., 269 F.2d 203 (1959), and affirmed on the merits, 295 F.2d 302 (1961). In March 1962 the Commission petitioned the Court of Appeals to enter a show cause order against Holland for contempt of its pendente lite order.......
  • American Financial Services Ass'n v. F.T.C.
    • United States
    • United States Courts of Appeals. United States Court of Appeals (District of Columbia)
    • July 12, 1985
    ...at enticing elderly women to enter contracts for extended series of dance lessons costing thousands of dollars); Holland Furnace Co. v. FTC, 295 F.2d 302 (7th Cir.1961) (unfair for salesman to dismantle home furnaces for cleaning and inspection and then refuse to reassemble them until custo......
  • Ross v. Philip Morris & Company
    • United States
    • United States Courts of Appeals. United States Court of Appeals (8th Circuit)
    • March 20, 1964
  • Pritchard v. Liggett & Myers Tobacco Company
    • United States
    • United States Courts of Appeals. United States Court of Appeals (3rd Circuit)
    • October 12, 1961
  • Request a trial to view additional results
3 books & journal articles
  • Federal Law of Unfair Competition
    • United States
    • ABA Antitrust Library Business Torts and Unfair Competition Handbook Business tort law
    • January 1, 2014
    ...Corp. v. FTC, 561 F.2d 357, 360-63 (D.C. Cir. 1977) (comparative advertising of automobiles). 220. See, e.g., Holland Furnace Co. v. FTC, 295 F.2d 302, 305 (7th Cir. 1961) (misrepresentations regarding competitors’ products); E.B. Muller & Co. v. FTC, 142 F.2d 511, 516 (6th Cir. 1944) (disp......
  • Unfair Acts or Practices Under Cutpa - the Case for Abandoning the Obsolete Cigarette Rule and Following Modern Ftc Unfairness Policy
    • United States
    • Connecticut Bar Association Connecticut Bar Journal No. 77, January 2003
    • Invalid date
    ...a small harm to a large number of people, or if it raises a significant risk of concrete harm. 13 See, e.g., Holland Furnace Co. v. FTC, 295 F.2d 302 (7th Cir. 1961) (seller's servicemen dismantled home furnaces and then refused to reassemble them until the consumers had agreed to buy servi......
  • DEFENDING ESG: A NEW STANDARD OF REVIEW FOR DEFENSIVE MEASURES THAT IMPACT ESG RATINGS.
    • United States
    • University of Pennsylvania Law Review Vol. 171 No. 1, December 2022
    • December 1, 2022
    ...Cheff, 199 A.2d at 555. (14) Id. at 552. (15) Id. (16) HILL ET AL., supra note 3, at 502. (17) Holland Furnace Co. v. Fed. Trade Comm'n, 295 F.2d 302, 303-04 (7th Cir. (18) See id. at 303, 306 (denying Holland's petition for a review of the FTC decision, which directed Holland to cease and ......

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