S. Buchsbaum & Co. v. Federal Trade Commission

• Decision Date: 06 May 1946
• Docket Number: No. 8504.,8504.
• Citation: 153 F.2d 85
• Parties: S. BUCHSBAUM & CO. v. FEDERAL TRADE COMMISSION.
• Court: U.S. Court of Appeals — Seventh Circuit

153 F.2d 85 (1946)

S. BUCHSBAUM & CO. v. FEDERAL TRADE COMMISSION.

No. 8504.

Circuit Court of Appeals, Seventh Circuit.

January 14, 1946.

Writ of Certiorari Granted May 6, 1946.

Walter H. Moses, of Chicago, Ill. (Moses, Kennedy, Stein & Bachrach, of Chicago, Ill., of counsel), for petitioner.

Joseph J. Smith, Jr., Asst. Chief Counsel, Federal Trade Commission, of Washington, D. C., W. T. Kelley, Chief Counsel, and Carl C. Wheaton, Sp. Atty., both of Washington, D. C., for respondent.

Before SPARKS and KERNER, Circuit Judges, and BALTZELL, District Judge.

Writ of Certiorari Granted May 6, 1946. See 66 S.Ct. 1016.

SPARKS, Circuit Judge.

By this proceeding petitioner seeks to review and set aside a cease and desist order of the Federal Trade Commission. The complaint charged petitioner with having engaged in unfair and deceptive acts and practices in violation of the Federal Trade Commission Act, 15 U.S.C.A. § 41 et seq. The charge was that by the use of the trade name "Elasti-Glass" petitioner had falsely represented that various men's accessories made by petitioner from a chemically manufactured plasticized resinous material called "Vinylite" were made and constructed of glass. The answer admitted that petitioner manufactured "Elasti-Glass" products and advertised and sold them in interstate commerce as alleged in the complaint. It denied, however, that its trade name and representations were false or deceptive. It asserted that although "Vinylite" was a chemically manufactured plasticized resinous material, it was in fact an organic glass, a synthetic resin glass scientifically produced and properly designated as glass. It further alleged that the word "glass," as properly used and defined, includes both organic glasses and inorganic glasses, and denied that, by the use of the term "Elasti-Glass" or in any other way, it had misled or deceived the public into believing that its products were made of inorganic glass.

In substance the Commission found the facts as follows: Petitioner is an Illinois corporation engaged in the business of manufacturing various men's accessories such as suspenders, belts, garters, etc., which it advertises and sells in interstate commerce under the trade name "Elasti-Glass." It also found that glass as understood and recognized by the general public is the common glass found in window panes, tumblers, and bottles, and petitioner's use of the term "Elasti-Glass" tends to mislead a substantial portion of the purchasing public into the belief that petitioner's products are made from common glass specially processed in some manner to make it pliable and elastic; that petitioner's products are not glass as understood by the purchasing public; that they are made of plastic material, "Vinylite," which has none of the characteristics of glass as recognized and understood by the general public, other than that of transparency, and which differs so greatly in composition, methods of manufacture, and properties from those substances commonly known as glass that it constitutes a part of a separate division of chemical technology. On these facts the Commission concluded the petitioner was engaged in deceptive acts and practices in violation of the Federal Trade Commission Act, and accordingly ordered petitioner, in connection with the offering for sale, the selling and distribution of men's accessories and other similar articles of merchandise in interstate commerce, to cease and desist from:

1. Using the term "Elasti-Glass" or any other term containing the word "glass" to designate or describe any article of merchandise made of the material "Vinylite" or any other similar compound.

2. Representing in any manner, either directly or by implication, that any article of merchandise made from "Vinylite" or any other similar synthetic resinous compound is made of glass.

The first question raised for our consideration is whether the Commission erred in denying petitioner's motion for a trial de novo, and in failing to strike from the record the evidence taken before Trial Examiner Reeves.

W. C. Reeves was the Trial Examiner originally appointed to act in this case. He conducted hearings on April 3 and 4, 1941, at Chicago, and on April 11 and 12, 1941, at Toledo, Ohio, at which evidence was taken covering 619 pages of transcript, and 48 Commission exhibits and 17 of petitioner's exhibits were received in evidence. Sixteen witnesses for the Commission testified before him, including all six of the consumer witnesses.

Mr. Reeves died October 26, 1941. Trial Examiner Vilas was appointed on November 17, 1941, to complete the taking of testimony, close the case and make his report upon the evidence. Within four days from that date petitioner filed with the Commission its motion that there be a trial de novo and that the transcript of hearings before Trial Examiner Reeves be stricken from the record. The motion was denied by the Commission on December 5, 1941, and Examiner Vilas proceeded from where Mr. Reeves left off, and based his report both upon the evidence taken before Mr. Reeves and that heard by him. On these facts appellant contends that the court erred in not granting a trial de novo. We think the ruling was erroneous, and we find no authority adverse to our conclusion. Ohio Bell Telephone Co. v. Public Utilities Commission, 301 U.S. 292, 57 S.Ct. 724, 81 L.Ed. 1093; Morgan v. United States, 304 U.S. 1, 58 S.Ct. 999, 82 L.Ed. 1129; Wigmore on Evidence (3rd Ed.) Vol. III, § 946; and Rubin v. Lipman, D.C., 215 F. 669.

The Commission contends that...