Moretrench Corporation v. Federal Trade Commission, 2.

• Decision Date: 04 May 1942
• Docket Number: No. 2.,2.
• Parties: MORETRENCH CORPORATION v. FEDERAL TRADE COMMISSION.
• Court: U.S. Court of Appeals — Second Circuit

127 F.2d 792 (1942)

MORETRENCH CORPORATION v. FEDERAL TRADE COMMISSION.

No. 2.

Circuit Court of Appeals, Second Circuit.

May 4, 1942.

Samuel J. Reid, of New York City, and McCole & Reid, of New York City, for petitioner.

Cyrus B. Austin and W. T. Kelley, both of Washington, D. C., for respondent.

Before L. HAND, SWAN, and CHASE, Circuit Judges.

L. HAND, Circuit Judge.

The Moretrench Corporation complains of an order of the Federal Trade Commission which found that certain statements occurring in its advertising were false, and which ordered it to "cease and desist" from repeating them in the future. The Commission now concedes that its original order should be modified, and the only question before us is whether as modified it finds support in the findings, and whether the evidence supports the findings. To an understanding of this question, some account of the Moretrench Corporation's business is necessary. It makes, sells and installs systems of pumps, piping and well-points which are used to drain wet places preparatory to building or engineering operations. The wellpoints about which this controversy turns are the means by which the water is sucked up which the piping discharges away from the locus in quo. The Moretrench wellpoint is a metal nozzle about three and a half feet long, made up of an inner solid pipe surrounded by seven longitudinal metal rods, which are enclosed by a copper screen of wide mesh and heavy wire. Outside of this screen is a screen of fine wire and small mesh, and outside of the fine screen is a third screen of the same size wire and mesh as the first. The fine screen is thus held between the two coarse screens; it is known as the "water-passing screen." In operation, the lower end of the wellpoint is sunk into the ground and the water is sucked through the three screens, whence it passes up between the metal rods outside the solid pipe, and is carried away through the piping. To sink the wellpoint into position, water is "jetted" through the hollow pipe, at the bottom of which is a rubber ball arranged as a valve to open when water is forced through it and to close when water is sucked into it. All wellpoints have such a valve but the Moretrench has an added valve set between the screen and the solid pipe so as to close during "jetting," and to prevent all "jetting" water from flowing up ("backwashing") into the draining space.

The Moretrench Corporation put out an advertising pamphlet in which it compared its system with that of its competitors, of which only two are in question here: the Complete and the Griffin. The pamphlet contained photographs of its screen and of a section of its wellpoint, together with photographs of the screen of other makers; also a photograph of five wellpoints side by side in elevation, including its own, the Complete and the Griffin. Below the last photograph was a table professing to give statistics as to the wellpoints shown, in the first line of which was the legend: "Unobstructed water-passing screen area in square inches." The Moretrench wellpoint was credited with 350 inches, the Complete with 40, and the Griffin with 85. The Commission has found that this statement was untrue and has directed its discontinuance. The second statement which it forbade was that the Complete and Griffin wellpoints "have only a limited use as jetting points, because they lack a valve to prevent back waste of the jetting water, and cannot wash the jetted hole out as thoroughly as it should be done to get the best service with the water pressure available." On another page of the Moretrench pamphlet appeared photographs of its wellpoint and another of the Complete, while both were "jetting"; below was the statement that the Complete wellpoint "backwasted nearly all of the jetting pressure." The third statement forbidden is that a Moretrench wellpoint was equal or superior to five of any other wellpoints; the fourth, that it never "clogs"; the fifth, that "contractors all over the world testify" that the cost of its operation is always fifty per cent lower than that of competitors'.

The Complete wellpoint is made of a hollow pipe like the Moretrench, but instead of being circular in section its outer surface is fluted. When the fine screen is wrapped outside the pipe, it necessarily touches it only at the outer turns of the flutings, leaving vertical grooves for draining the water between pipe and screen. Around the outside of the fine screen is wrapped a perforated casing against the inside of which the inner screen fits snugly when the wellpoint is delivered, but from which it backs away a little in use, except where the casing holds it close to the outer turns of the flutings. The Griffin wellpoint has an inner pipe whose outer surface is circular in section like the Moretrench; and in order to make a draining space between it and the screen, a convoluted perforated sheet of metal is interposed between the two, which presents a surface to the fine screen like the flutings of the Complete wellpoint except for the perforations. Around this sheet the fine screen is wrapped, making vertical draining passages between the two; and also between the pipe and the inner side of sheet, for so much of the water as passes through the perforations. Around the fine screen is finally wrapped a perforated casing like that in the Complete. As in the case of the Complete wellpoint, the fine screen when delivered fits snugly against the inside of the casing, but in use it backs off a little except where it is held against a convolution of the inner sheet. Neither wellpoint has a second valve to stop the "backwash" during "jetting."

The first question is as to the meaning of the phrase: "Unobstructed water-passing screen area." The witnesses for the Moretrench Corporation understood this to mean the whole area of the fine...