(a) Reporting and transcription. Hearings shall be stenographically reported and transcribed by the official reporter of the Commission under the supervision of the hearing examiner, and the original transcript shall be a part of the record and the sole official transcript. Copies of transcripts are available from the reporter at rates not to exceed the maximum rates fixed by contract between the Commission and the reporter.

(b) Corrections. Corrections of the official transcript may be made only when they involve errors affecting substance and then only in the manner herein provided. Corrections ordered by the hearing examiner or agreed to in a written stipulation signed by all counsel and parties not represented by counsel, and approved by the hearing examiner, shall be included in the record, and such stipulations, except to the extent they are capricious or without substance, shall be approved by the hearing examiner. Corrections shall not be ordered by the hearing examiner except upon notice and opportunity for the hearing of objections. Such corrections shall be made by the official reporter by furnishing substitute type pages, under the usual certificate of the reporter, for insertion in the official record. The original uncorrected pages shall be retained in the files of the Commission.

§ 3.45 In camera orders.

(a) Definition. Except as hereinafter provided, documents and testimony made subject to in camera orders are not made a part of the public record, but are kept confidential, and only respondents, their counsel, authorized Commission personnel, and court personnel concerned with judicial review shall have access thereto. The right of the hearing examiner, the Commission, and reviewing courts to disclose in camera data to the extent necessary for the proper disposition of the proceeding is specifically reserved.

(b) In camera treatment of documents and testimony. Hearing examiners shall have authority, but only in those unusual and exceptional circumstances when good cause is found on the record (see Commission's interlocutory decision in H. P. Hood & Sons, Inc., Docket 7709, Mar. 14, 1961, 58 F.T.C. 1184), to order documents or oral testimony offered in evidence, whether admitted or rejected,

to be placed in camera. The order shall specify the date on which in camera treatment expires and shall include: (1) A description of the documents and testimony; (2) a full statement of the reasons for granting in camera treatment; and (3) a full statement of the reasons for the date on which in camera treatment expires. Any party desiring, for the preparation and presentation of the case, to disclose in camera documents or testimony to experts, consultants, prospective witnesses, or witnesses, shall make application to the hearing examiner setting forth the justification therefor. The hearing examiner, in granting such application for good cause found, shall enter an order protecting the rights of the affected parties and preventing unnecessary disclosure of information. In camera documents and the transcript of testimony subject to an in camera order shall be segregated from the public record and filed in a sealed envelope, bearing the title and docket number of the proceeding, the notation "In Camera Record under § 3.45," and the date on which in camera treatment expires.

(c) Release of in camera information. In camera documents and testimony shall constitute a part of the confidential records of the Commission and shall be subject to the provisions of § 4.11 of this chapter. However, the Commission, on its own motion without notice to any affected party, may make in camera documents and testimony available for inspection, copying, or use by any other governmental agency.

(d) Briefing of in camera information. In the submittal of proposed findings, briefs, or other papers, counsel for all parties shall make a good faith attempt to refrain from disclosing the specific details of in camera documents and testimony. This shall not preclude references in such proposed findings, briefs, or other papers to such documents or testimony including generalized statements based on their contents. To the extent that counsel consider it necessary to include specific details of in camera data in their presentations, such data shall be incorporated in separate proposed findings, briefs, or other papers marked "confidential," which shall be placed in camera and become a part of the in camera record.

§ 3.46 Proposed findings, conclusions, and order.

At the close of the reception of evidence, or within a reasonable time thereafter fixed by the hearing examiner, any party may file with the Secretary of the Commission for consideration of the hearing examiner proposed findings of fact, conclusions of law, and rule or order, together with reasons therefor and briefs in support thereof. Such proposals shall be in writing, shall be served upon all parties, and shall contain adequate references to the record and authorities relied on. The record shall show the hearing examiner's ruling on each proposed finding and conclusion, except when his order disposing of the proceeding otherwise informs the parties of the action taken by him thereon.

(a) When filed and when effective. Within ninety (90) days after completion of the reception of evidence in a proceeding (or within thirty (30) days in cases of (1) default under § 3.12(c), or of (2) waiver by the parties of the filing of proposed findings of fact, conclusions of law, and rule or order provided for in § 3.46) or within such further time as the Commission may allow by order entered in the record based upon the hearing examiner's written request, the hearing examiner shall file an initial decision which shall become the decision of the Commission thirty (30) days after service thereof upon the parties, unless prior thereto (i) an appeal is perfected under $3.52; (ii) the Commission by order stays the effective date of the decision; or (iii) the Commission issues an order placing the case on its own docket for review: Provided, however, That the failure of an appellant to file an appeal brief within the time prescribed by § 3.52 shall extend for ten (10) days the period within which the Commission may by order stay the effective date of the initial decision or place the case on its own docket for review.

(b) Content. The initial decision shall include a statement of (1) findings (with specific page references to principal supporting items of evidence in the record) and conclusions, as well as the reasons or basis therefor, upon all the material issues of fact, law, or discretion presented on the record, and (2) an appro

priate rule or order. The initial decision shall be based upon a consideration of the whole record and supported by reliable, probative, and substantial evidence.

(c) By whom made. The initial decision shall be made and filed by the hearing examiner who presided over the hearings, except when he shall have become unavailable to the Commission.

(d) Reopening of proceeding by hearing examiner; termination of jurisdiction. (1) At any time prior to the filing of his initial decision, a hearing examiner may reopen the proceeding for the reception of further evidence.

(2) Except for the correction of clerical errors, the jurisdiction of the hearing examiner is terminated upon the filing of his initial decision, unless and until the proceeding is remanded to him by the Commission.

§ 3.52

Appeal from initial decision.

(a) Who may file; notice of intention. Any party to a proceeding may appeal an initial decision to the Commission: Provided, That within ten (10) days after completion of service of the initial decision such party files a notice of intention to appeal.

(b) Appeal brief. The appeal shall be in the form of a brief, filed within thirty (30) days after completion of service of the initial decision, and shall contain, in the order indicated, the following:

(1) A subject index of the matter in the brief, with page references, and a table of cases (alphabetically arranged), textbooks, statutes, and other material cited, with page references thereto;

(2) A concise statement of the case; (3) A specification of the questions intended to be urged;

(4) The argument presenting clearly the points of fact and law relied upon in support of the position taken on each question, with specific page references to the record and the legal or other material relied upon; and

(5) A proposed form of rule or order for the Commission's consideration in lieu of the rule or order contained in the initial decision.

(c) Answering brief. Within thirty (30) days after service of the brief upon a party, such party may file an answering brief which shall also contain a subject index, with page references, and a table of cases (alphabetically arranged), textbooks, statutes, and other material cited, with page references thereto. It shall

present clearly the points of fact and law relied upon in support of the position taken on each question, with specific page references to the record and legal or other material relied upon.

(d) Reply brief. Reply briefs shall be limited to rebuttal of matters in answering briefs and will be received if filed and served within seven (7) days after receipt of the answering brief or the day preceding the oral argument, whichever comes first. No answer to a reply brief will be permitted.

(e) Length of briefs. No brief in excess of sixty (60) pages, including any appendices, shall be filed without leave of the Commission.

(f) Oral argument. Oral arguments will be held in all cases on appeal to the Commission, unless the Commission otherwise orders upon its own initiative or upon request of any party made at the time of filing his brief. Oral arguments before the Commission shall be reported stenographically, unless otherwise ordered, and a member of the Commission absent from an oral argument may participate in the consideration and decision of the appeal in any case in which the oral argument is stenographically reported. The purpose of oral argument is to emphasize and clarify the written argument appearing in the briefs and to answer questions. Reading at length from the briefs or other texts is not favored.

[32 F.R. 8449, June 13, 1967, as amended at 33 F.R. 7033, May 10, 1968]

§ 3.53

Review of initial decision in absence of appeal.

An order by the Commission placing a case on its own docket for review will set forth the scope of such review and the issues which will be considered and will make provision for the filing of briefs if deemed appropriate by the Commission. § 3.54 Decision on appeal or review.

(a) Upon appeal from or review of an initial decision, the Commission will consider such parts of the record as are cited or as may be necessary to resolve the issues presented and, in addition, will, to the extent necessary or desirable, exercise all the powers which it could have exercised if it had made the initial decision.

(b) In rendering its decision, the Commission will adopt, modify, or set aside the findings, conclusions, and rule or order contained in the initial decision,

and will include in the decision a statement of the reasons or basis for its action and any concurring and dissenting opinions.

(c) In those cases where the Commission believes that it should have further information or additional views of the parties as to the form and content of the rule or order to be issued, the Commission, in its discretion, may withhold final action pending the receipt of such additional information or views.

(d) The order of the Commission disposing of adjudicative hearings under the Fair Packaging and Labeling Act will be published in the FEDERAL REGISTER and, if it contains a rule or regulation, will specify the effective date thereof, which will not be prior to the ninetieth (90th) day after its publication unless the Commission finds that emergency conditions exist necessitating an earlier effective date, in which event the Commission will specify in the order its findings as to such conditions.

§ 3.55 Reconsideration.

Within twenty (20) days after completion of service of a Commission decision, any party may file with the Commission a petition for reconsideration of such decision, setting forth the relief desired and the grounds in support thereof. Any petition filed under this subsection must be confined to new questions raised by the decision or final order and upon which the petitioner had no opportunity to argue before the Commission. Any party desiring to oppose such a petition shall file an answer thereto within ten (10) days after service upon him of the petition. The filing of a petition for reconsideration shall not operate to stay the effective date of the decision or order or to toll the running of any statutory time period affecting such decision or order unless specifically so ordered by the Commission.

Subpart G-Reports of Compliance § 3.61 Reports of compliance.

(a) In every proceeding in which the Commission has issued an order to cease and desist, each respondent named in such order shall file with the Commission, within sixty (60) days after service thereof, or within such other time as may be provided by the order, a report in writing, signed by the respondent, setting forth in detail the manner and form of his compliance with the order, and

shall thereafter file with the Commission such further signed, written reports of compliance as it may require. Reports of compliance shall be under oath if so requested. Where the order prohibits the use of a false advertisement of a food, drug, device, or cosmetic which may be injurious to health because of results from its use under the conditions prescribed in the advertisement, or under such conditions as are customary or usual, or if the use of such advertisement is with intent to defraud or mislead, or where the order was issued under the Flammable Fabrics Act, or in any other case where the circumstances so warrant, the order may provide for an interim report stating whether and how respondents intend to comply to be filed within ten (10) days after service of the order. When court review of an order of the Commission is pending, the respondent shall file only such reports of compliance as the court may require. Thereafter, the time for filing report of compliance shall begin to run de novo from the final judicial determination, except that if no petition for certiorari has been filed following affirmance of the order of the Commission by a court of appeals, the compliance report shall be due the day following the date on which the time expires for the filing of such petition. The Commission will review such reports of compliance and will advise each respondent whether the actions set forth therein evidence compliance with the Commission's order.

(b) The Commission has delegated to the Directors and Assistant Directors of the Bureaus of Deceptive Practices, Restraint of Trade, and Textiles and Furs, without power of redelegation, the authority, for good cause shown, to extend the time within which reports of compliance with orders to cease and desist may be filed. It is to be noted, however, that an extension of time within which a report of compliance may be filed, or the filing of a report which does not evidence full compliance with the order, does not in any circumstances suspend or relieve a respondent from his obligation under the law with respect to compliance with such order. An order of the Commission to cease and desist becomes final on the date and under the conditions provided in section 5 (g), (h), (i), (j), and (k) of the Federal Trade Commission Act (15 U.S.C. 45 (g), (h), (i), (j), and (k)) and section 11 (g), (h), (i), (j), and (k) of an Act to supplement

existing laws against unlawful restraints and monopolies, and for other purposes, as amended-the Clayton Act, as amended (15 U.S.C. 21 (g), (h), (i), (j), and (k)). Any person, partnership or corporation against which an order to cease and desist has been issued who is not in full compliance with such order on and after the date provided in these statutes for the order to become final is in violation of such order and is subject to an immediate action for civil penalties.

(c) Any respondent subject to a Commission order may request advice from the Commission as to whether a proposed course of action, if pursued by it, will constitute compliance with such order. The request for advice should be submitted in writing to the Secretary of the Commission and should include full and complete information regarding the proposed course of action. On the basis of the facts submitted, as well as other information available to the Commission, the Commission will inform the respondent whether or not the proposed course of action, if pursued, would constitute compliance with its order. (This procedure is applicable only to advice sought with respect to a proposed course of action, and not to advice sought concerning any course of action already in being. Furthermore, the filing of a request for advice under this subsection does not in any circumstances suspend or relieve a respondent from his obligation under the law with respect to his compliance with the order. He must in any event be in full compliance on and after the date the order becomes final as prescribed by statute referred to in paragraph (b) of this section.) Advice to respondents under this paragraph will be published by the Commission in the same manner and subject to the same restrictions and considerations as advisory opinions under § 1.4 of this chapter.

(d) The Commission may at any time reconsider its approval of any report of compliance or any advice given under this section and, where the public interest requires, rescind or revoke its prior approval or advice. In such event the respondent will be given notice of the Commission's intent to revoke or rescind and will be given an opportunity to submit its views to the Commission. The Commission will not proceed against a respondent for violation of an order with respect to any action which was taken in good faith reliance upon the Com

mission's approval or advice under this section, where all relevant facts were fully, completely, and accurately presented to the Commission and where such action was promptly discontinued upon notification of rescission or revocation of the Commission's approval.

(e) All applications for approval of proposed divestitures, acquisitions, or similar transactions subject to Commission review under outstanding orders, together with supporting materials, will be placed on the public record as soon after they are received as circumstances permit, except for information for which confidential classification has been requested, with a showing of justification therefor, and which the Commission, with due regard to statutory restrictions, its rules, and the public interest, has determined should not be made public. Also, any communications, written or oral, concerning such proposed transactions, received by any member of the Commission, or by any employee involved in the decisional process, will be placed on the public record immediately after their receipt. In the case of an oral communication, the member or employee shall immediately furnish the Commission with a memorandum setting forth the full contents of such communication and the circumstances thereof, and such memorandum will immediately be placed on the public record. Within thirty (30) days after such applications and materials are placed on the public record, any person may file for the public record written objections or comments with the Secretary of the Commission. All responses to applications for approval of proposed divestitures, acquisitions, or similar transactions subject to Commission review under outstanding orders, together with a statement of supporting reasons, will be published when made. [32 F.R. 8449, June 13, 1967, as amended at 34 F.R. 17432, Oct. 29, 1969]

Subpart H-Reopening of
Proceedings

§ 3.71 Authority.

Except while pending in a U.S. court of appeals on a petition for review (after the transcript of the record has been filed) or in the U.S. Supreme Court, a proceeding may be reopened by the Commission at any time. Such a reopening may be either on the Commission's own initiative or on the request of any party to the proceeding.

(a) Before statutory review. At any time prior to the expiration of the time allowed for filing a petition for review or prior to the filing of the transcript of the record of a proceeding in a U.S. court of appeals pursuant to a petition for review, the Commission may upon its own initiative and without prior notice to the parties reopen the proceeding and enter a new decision modifying or setting aside the whole or any part of the findings as to the facts, conclusions, rule, order, or opinion issued by the Commission in such proceeding.

(b) After decision has become finai. (1) Whenever the Commission is of the opinion that changed conditions of fact or law or the public interest may require that a Commission decision containing a rule or order which has become effective, or an order to cease and desist which has become final by reason of court affirmance or expiration of the statutory period for court review without a petition for review having been filed, or a Commission decision containing an order dismissing a proceeding, should be altered, modified, or set aside in whole or in part, the Commission will serve upon each person subject to such decision (in the case of proceedings instituted under §3.13, such service may be by publication in the FEDERAL REGISTER) an order to show cause, stating the changes it proposes to make in the decision and the reasons they are deemed necessary. Within thirty (30) days after service of such order to show cause, any person served may file an answer thereto. Any person not responding to the order within the time allowed may be deemed to have consented to the proposed changes.

(2) Whenever any person subject to a decision containing a rule or order which has become effective, or an order to cease and desist which has become final, is of the opinion that changed conditions of fact or law require that said rule or order be altered, modified, or set aside, or that the public interest so requires, such person may file with the Commission a petition requesting a reopening of the proceeding for that purpose. The petition shall state the changes desired, the grounds therefor, and shall include, when available, such supporting evidence and argument as will in the absence of a contest provide the basis for a Commission decision on the petition. Within thirty (30) days after service of such a