Federal Trade Commission v. Flotill Products, Inc, No. 20

CourtUnited States Supreme Court
Writing for the CourtBRENNAN
Citation19 L.Ed.2d 398,389 U.S. 179,88 S.Ct. 401
PartiesFEDERAL TRADE COMMISSION, Petitioner, v. FLOTILL PRODUCTS, INC., eta l
Docket NumberNo. 20
Decision Date04 December 1967

389 U.S. 179
88 S.Ct. 401
19 L.Ed.2d 398
FEDERAL TRADE COMMISSION, Petitioner,

v.

FLOTILL PRODUCTS, INC., eta l.

No. 20.
Argued Oct. 16, 1967.
Decided Dec. 4, 1967.

Howard E. Shapiro, Washington, D.C., for petitioner.

William Simon, Washington, D.C., for respondents.

Page 180

Mr. Justice BRENNAN delivered the opinion of the Court.

The question in this case is whether an enforceable cease-and-desist order of the Federal Trade Commission requires the concurrence of a majority of the full Commission, or only of a majority of the quorum that participated in the decision to issue the order.

The Commission has five Commissioners, 15 U.S.C. § 41.1 A full Commission heard oral argument in this case involving a complaint that respondent made payments in lieu of brokerage in violation of § 2(c) of the Robinson-Patman Act and granted promotional allowances in violation of § 2(d) of that Act. 15 U.S.C. §§ 13(c) and (d). Two Commissioners retired before the Commission rendered its decision. Although one vacancy was filled in the interim, only three Commissioners participated in the decision because the new Commissioner, not having heard the oral argument, declined to participate. All three participating Commissioners concurred that respondent granted promotional allowances in violation of § 2(d). However, only two of the three concurred that respondent also made payments in lieu of brokerage in violation of § 2(c). On petition for review under 15 U.S.C. §§ 21(c) and 45(c), a three-judge panel of the Court of Appeals for the Ninth Circuit enforced the Commission's cease-and-desist order as it related to the § 2(d) violation but refused to enforce the order, one judge dissenting, as it related to the § 2(c) violation. In refusing to enforce the § 2(c) part of the order, the Court of Appeals held that 'absent statutory authority or instruction to the

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contrary, three members of a five member commission must concur in order to enter a binding order on behalf of the commission.' 358 F.2d 224, 228.2 On rehearing en banc the full court sustained the panel decision five to four. 358 F.2d, at 234. Because of a conflict with decisions of other courts of appeals, see Atlantic Refining Co. v. FTC, 344 F.2d 599 (C.A.6th Cir.), LaPeyre v. FTC, 366 F.2d 117 (C.A.5th Cir.), we granted certiorari, Federal Trade Commission v. Flotill Products, 386 U.S. 1003, 87 S.Ct. 1343, 18 L.Ed.2d 431. We reverse.

The Federal Trade Commission Act does not specify the number of Commissioners who may constitute a quorum.3 A quorum of three Commissioners is provided for by a rule of the Commission first promulgated in 1915; in its current version it is Rule 1.7.4 No challenge

Page 182

to the authority of FTC to promulgate Rule 1.7 is made in this case; indeed, the Court of Appeals expressly disclaimed any '* * * doubt as to the validity of the Commission's practice of conducting hearings before less than the full membership,' 358 F.2d, at 230. Before us for review, therefore, is only the holding of the Court of Appeals which follows that disclaimer: 'We say only that an order of the Commission must be supported by three members in order to constitute an enforceable order of the FTC. Two of five is too few.' Ibid.

The rationale of the Court of Appeals was that the FTC could act only on the concurrence of a majority of the full Commission 'absent statutory authority or instruction to the contrary.' 358 F.2d, at 228. The court cited no authority affirmatively supporting that proposition; the court simply rejected—on the ground that it is inapplicable to 'a statutorily created administrative tribunal like the Federal Trade Commission,' 358 F.2d, at 229—the rule stated by the Court of Customs and Patent Appeals in Frischer & Co. v. Bakelite Corp., 39 F.2d 247, 255, that '* * * in collective bodies other than courts, even though they may exercise judicial

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authority, a majority of a quorum is sufficient to perform the function of the body.'5 Further, the court rejected as 'a bare conclusion' the holding of the Court of Appeals for the Sixth Circuit in Atlantic Refining Co. v. FTC, supra, that a majority of a panel of three Commissioners could act for the Commission.

Insofar as the Court of Appeals' holding implies that the proposition state by it is the common-law rule, the court was manifestly in error. The almost universally accepted common-law rule is the precise converse—that is, in the absence of a contrary statutory provision, a majority of a quorum constituted of a simple majority of a collective body is empowered to act for the body. 6 Where the enabling statute is silent on the question,

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the body is justified in adhearing to that common-law rule.

Respondent does not undertake to support the Court of Appeals' proposition as stated. Rather respondent concedes that the common-law rule is as we have stated it to be but argues that an exception allegedly recognized at common law in the case of courts should be applied to an agency like the FTC exercising quasijudicial functions; respondent cites the statement in Frischer, supra, at 255, that '(w)here courts are concerned, it has been uniformly held, so far as we can ascertain, that a clear majority of all the legally constituted members thereof shall concur or no valid judgment may be entered except such as may follow no decision.' But even on the doubtful premise that there is an exception in the case of courts,7 Frischer itself recognized, as we have seen, that

Page 185

the exception does not apply to administrative agencies with quasi-judicial functions. Ibid.8 It follows that the FTC is not inhibited from following the common-law rule unless Congress has declared otherwise. Since that declaration is not expressed in the Trade Commission Act, our task is narrowed to determining whether it may be read in by implication.

The Court of Appeals' opinion may be read as having found an implicit contrary declaration because Congress wrote the common-law rule into later statutes creating other agencies: '* * * when Congress wanted to authorize the exercise of the powers of an administrative body by less than the full body in other situations, it did not lack the words to do so expressly. Cf. National Labor Relations Board, 29 U.S.C. § 153(b); Interstate Commerce Commission, 49 U.S.C. § 17(1) (sic); Federal Power Commission, 16 U.S.C. § 792,' 358 F.2d, at 229. 9 How-

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ever, in another statute, reorganizing the Federal Maritime Commission, Congress enacted not the common-law rule but a unanimous concurrence provision, Reorganization Plan No. 7 of 1961, 75 Stat. 840; the reasoning of the Court of Appeals thus would equally justify an inference that Congress sanctioned the FTC's adherence to the common-law rule, since Congress has not lacked the words to abrogate such a practice expressly. This diversity in congressional treatment of the problem clearly forecloses reliance upon a particular choice in one statute as the basis for an inference of a contrary choice in another which says nothing on the matter.

The Court of Appeals seems also to have been of the view that there is a basis for inferring a contrary

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declaration from within the four corners of the Trade Commission Act itself. '(I)t is difficult to believe that Congress conceived of the five-member FTC with its politically balanced make-up, permitting two of its members to speak for the Commission, and failed to specifically provide enabling legislation.' 358 F.2d, at 229. This argument stresses the structural characteristics of the Commission—that it is a multi-membered body whose members serve long, staggered terms, and no more than three of whom may belong to the same political party. But the argument fails to take into account the fact that these features are common to almost all federal regulatory agencies, whose enabling acts, where they deal at all with the question of how many of a quorum may act for the agency, deal with it diversely. Nothing in the structure of the FTC, therefore, commands the inference that Congress intended to restrict the Commission to voting requirements not normally imposed on or adhered to by similarly structured agencies.

Respondent's final argument is that there is a basis for the inference in the action of Congress in 1961 in not disapproving the Reorganization Plan for the Commission submitted by President Kennedy.10 Under this plan the FTC was granted 'authority to delegate, by published order or rule, any of its functions to a division of the Commission, an individual Commissioner, a hearing examiner, or an employee or employee board, including functions with respect to hearing, determining, ordering, certifying, reporting or otherwise acting as to any work, business, or matter * * *.' The plan further pro-

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vided that 'the Commission shall retain a discretionary right to review the action of any such division of the Commission, individual Commissioner * * *' and that 'the vote of a majority of the Commission less one member thereof shall be sufficient to bring any such action before the Commission for review.' Reorganization Plan No. 4, § 1(a), (b). The Commission did not purport to act pursuant to Plan No. 4 in this proceeding. Nevertheless, respondent argues that the provision assuring a minority of the Commission a means to compel review by the full Commission is a congressional expression that Commission action shall be valid only when concurred in by a majority of the full membership. This argument is not persuasive,...

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66 practice notes
  • Public Service Commission of State of N. Y. v. Federal Power Commission, Nos. 24716
    • United States
    • United States Courts of Appeals. United States Court of Appeals (District of Columbia)
    • 27 Agosto 1975
    ...403, 444 F.2d 841, 861 (1970), cert. denied, 403 U.S. 923, 91 S.Ct. 2229, 2233, 29 L.Ed.2d 701 (1971). 124 FTC v. Flotill Prods., Inc., 389 U.S. 179, 183-185, 88 S.Ct. 401, 19 L.Ed.2d 398 125 See 16 U.S.C. Sec. 792 (1970). 126 In this view, we have no occasion to consider whether action of ......
  • Levinson v. Connecticut Bd. of Chiropractic Examiners, No. 13354
    • United States
    • Supreme Court of Connecticut
    • 20 Junio 1989
    ...constituted of a simple majority of a collective body is empowered to act for the body." FTC v. Flotill Products, Inc., 389 U.S, 179, 183, 88 S.Ct. 401, 404, 19 L.Ed.2d 398 (1967). "In the absence of legislative restriction, the general rule is that a committee or commission performing such......
  • Chamber of Commerce of U.S. v. Nat'l Labor Relations Bd., Civil Action No. 11–2262 (JEB).
    • United States
    • United States District Courts. United States District Court (Columbia)
    • 27 Julio 2012
    ...must participate for it to take an action, are two separate (albeit related) characteristics.” Id.;see also FTC v. Flotill Prods., Inc., 389 U.S. 179, 183–84, 88 S.Ct. 401, 19 L.Ed.2d 398 (1967) (concluding that Commissioner who declined to participate could not be counted toward quorum). D......
  • Railroad Yardmasters of America v. Harris, No. 82-2468
    • United States
    • United States Courts of Appeals. United States Court of Appeals (District of Columbia)
    • 16 Noviembre 1983
    ...S.REP. NO. 1065, 73d Cong., 2d Sess. 3 (1934). 25 See note 23, supra. 26 The District Court relied on FTC v. Flotill Prods., Inc., 389 U.S. 179, 88 S.Ct. 401, 19 L.Ed.2d 398 (1967), to raise the objection that "[t]he delegation provision was not utilized by the Board to enable it to operate......
  • Request a trial to view additional results
66 cases
  • Public Service Commission of State of N. Y. v. Federal Power Commission, Nos. 24716
    • United States
    • United States Courts of Appeals. United States Court of Appeals (District of Columbia)
    • 27 Agosto 1975
    ...403, 444 F.2d 841, 861 (1970), cert. denied, 403 U.S. 923, 91 S.Ct. 2229, 2233, 29 L.Ed.2d 701 (1971). 124 FTC v. Flotill Prods., Inc., 389 U.S. 179, 183-185, 88 S.Ct. 401, 19 L.Ed.2d 398 125 See 16 U.S.C. Sec. 792 (1970). 126 In this view, we have no occasion to consider whether action of ......
  • Levinson v. Connecticut Bd. of Chiropractic Examiners, No. 13354
    • United States
    • Supreme Court of Connecticut
    • 20 Junio 1989
    ...constituted of a simple majority of a collective body is empowered to act for the body." FTC v. Flotill Products, Inc., 389 U.S, 179, 183, 88 S.Ct. 401, 404, 19 L.Ed.2d 398 (1967). "In the absence of legislative restriction, the general rule is that a committee or commission performing such......
  • Chamber of Commerce of U.S. v. Nat'l Labor Relations Bd., Civil Action No. 11–2262 (JEB).
    • United States
    • United States District Courts. United States District Court (Columbia)
    • 27 Julio 2012
    ...must participate for it to take an action, are two separate (albeit related) characteristics.” Id.;see also FTC v. Flotill Prods., Inc., 389 U.S. 179, 183–84, 88 S.Ct. 401, 19 L.Ed.2d 398 (1967) (concluding that Commissioner who declined to participate could not be counted toward quorum). D......
  • Railroad Yardmasters of America v. Harris, No. 82-2468
    • United States
    • United States Courts of Appeals. United States Court of Appeals (District of Columbia)
    • 16 Noviembre 1983
    ...S.REP. NO. 1065, 73d Cong., 2d Sess. 3 (1934). 25 See note 23, supra. 26 The District Court relied on FTC v. Flotill Prods., Inc., 389 U.S. 179, 88 S.Ct. 401, 19 L.Ed.2d 398 (1967), to raise the objection that "[t]he delegation provision was not utilized by the Board to enable it to operate......
  • Request a trial to view additional results

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