Federal Trade Commission. That is the reason that we put his whole statement into the record and let the members of the committee read for themselves.

Mr. REECE. The judge said in the Baney case :

The Trade Commission, like many other modern administrative legal experiments, is called upon simultaneously to act the roles of complainant, judge, jury, and counsel.

I do not know what interest the judge would be or was serving there. Mr. DAVIS. Mr. Chairman, Congressman Reece is not asking any questions. He is not seeking enlightenment. He is simply trying to inject these different things into my statement and I do not think it is fair. It is not according to the rule of the committee or any of the other congressional committees that I have any knowledge of.

Mr. SADOWSKI. Maybe he is appearing as a witness for himself. Mr. DAVIS. I think I ought to get in my statements.

Mr. REECE. I want to ask if you agree with this statement because it was made by one of the witnesses who appeared for the Federal Trade Commission, Mr. Montague

Mr. DAVIS. I do not care to pass upon it. That is not relevant.

Mr. Chairman, I ask that I be permitted to finish my statement—I know you are going to have to adjourn pretty soon-and not be constantly interrupted by Mr. Reece, who is not doing it to seek enlightenment. He is doing it to interfere with the record and take up our time.

Mr. REECE. My purpose here is to develop some information on the three major points involved in the bill.

One of them is very pertinent: This quotation in the Harriet Hubbard Ayer case, in which the Commission's order was reversed, says:

The rule is now well recognized that the finding of fact by the Commission, having any evidence to support it, is conclusive and binding upon the courts, and we may not review the weight of the testimony.

Mr. SADOWSKI. That was discussed by Mr. Kelley previously.

Mr. KELLEY. I may say this, that if a question of an administrative tribunal exercising the mandate of Congress was relevant under this bill, it would be very well for you to call Judge Groner and Dean Pound and Justice Martin about statements that they have made that I have heard and their writings. I do not want to speak for them. I do not think that they fundamentally believe in administrative tribunals as they have been constituted by Congress. That is a matter for the Congress. That was a matter that for 3 years they have been thrashing out with all of the different bills that were considered which crystallized in the House, in the bill of Mr. Sumners, the chairman of the Judiciary Committee, and over in the Senate.

I confidently predicted it would not be long until those bills are passed. Those bills deal with the question of judge, jury, and prosecutor among a great many other things.

Your amendment does not deal with that question. If it did, Justice Groner and Justice Martin that you mentioned, would be witnesses for you, because I do not think they would believe in an administrative tribunal as they are constituted by Congress, but Congress did so constitute them. They are constitutional. No one has ever intimated that they were unconstitutional. The courts have pronounced them time and time and time again as constitutional. It is not a question of

being in or out of the Constitution. It is constitutional. The point is that they have nothing to do whatsoever with the amendment here. We are talking about H. R. 2390.

Mr. REECE. I will not press these quotations as a basis for my question, because I do not want to cause anyone to become impatient, neither do I want to consume the time of the committee, but when a court makes a statement as was made in the Harness case, for instance, in which it was said:

It follows there will be no occasion to resort to the record on which the findings were based unless it is alleged that there was no evidence to support a particular finding and then it would be necessary to examine only so much of the evidence as pertained to that subject

And numerous other ones. I am not going to go farther, but in view of these findings of the court, in view of these statements by the court, I can understand how respondents might feel ill at ease because, in view of that very strong statement of the court

Mr. KELLEY. The statement that you just read from, that and all of these things that you pick out need explanation.

When the Federal Trade Commission was created back in 1914, it was the second administrative tribunal of the United States Government. The only one that antedated it was the Interstate Commerce Commission. I do not know how long ago that decision was. That was a price-fixing conspiracy case that you mentioned, decided by .the circuit court of appeals at Cincinnati, and it must be over 15 years ago. The Commission had a long, elaborate set of findings in that case that it made after trial, every one of which findings was approved by the circuit court of appeals and the order of the Commission was affirmed by the circuit court of appeals.

You picked that sentence out of that decision rendered by that court in a price-fixing case nearly 20 years ago.

I do not think that is quite according to Hoyle. It does not prove a thing.

Mr. SADOWSKI. That same gentleman may have changed his mind by this time?

Mr. KELLEY. Exactly.

Mr. SADOWSKI. You may proceed.

Mr. DAVIS. Kenneth Perry, one of the witnesses favoring the bill, made this statement:

I do not think there would be many cases, Mr. O'Hara, because most of them are wrong. The Commission is generally right; the Commission is right in an overwhelming percentage of the cases. Most of the cases should not even be tried. If the attorneys were familiar with the law, they would not try many of these cases, because their clients are wrong, the practice is bad from the beginning, they shouldn't be in it. * *

*

As I say, it is patently bad practice, as a rule, on the part of the company. And then Robert L. Swain, who is the editor of Drug Topics and Drug Trade News, made this statement: "It [the Reece bill] is a step in assuring justice in those relatively small number of cases in which the question of justice is still open."

Gentlemen, everybody recognizes that the number of cases they complain about are infinitesimally small, and we think they are wrong in their complaint with respect to at least most of those.

There is an effort to break down the procedure of the Federal Trade Commission, including a proposal that has never been made before in any bill before any previous committee or subcommittee.

The question is whether in order to favor a few, a very small percentage of people who are not willing to stop the unfair practices, you are willing to make it most difficult to protect the public health and the public interest.

This bill has been pending more than a year. There has been a tremendous amount of propaganda in behalf of it. Some of these trade magazines said that James F. Hoge wrote the bill and it is also reported that he wrote two statements, extension of remarks, that Congressman Reece put in the Congressional Record.

Mr. REECE. Without attempting to answer either of your statements because that is unnecessary, I think they are entirely improper, although I do not care for them being in the record, but I might say, for the benefit of the record, that at the time this bill was introduced, I probably had met Mr. Hoge but I had no recollection of having met him and he had not talked with me about it. The first man who spoke to me with reference to some of the difficulties which this bill seeks to cure was a very good friend of mine at home who enjoys a high reputation in social, church, and business affairs. It is unnecessary to call his name but he as a citizen had every right to be interested and discuss the matter with me. I am sure neither members of the committee nor of the House will appreciate these extraneous remarks by you.

These imputations which you undertake to make, Judge, do not disturb me in the least, but I think, certainly, it hardly proper, Mr. Chairman, for a witness to make statements of that type before the committee, but I do not want the committee to rule on that. I want to leave that entirely to the judgment, discretion, and sence of propriety of the witness.

Mr. DAVIS. I am perfectly willing to compare propriety with you any day.

Now, Mr. Chairman, during that year articles have been appearing in these magazines which are supported by the drug and cosmetic industries as well as others.

Mr. REECE. But I might

Mr. DAVIS. They had articles at first in which they were complaining that the trade was not taking any interest.

Mr. REECE. But I might add, if the judge will permit, in connection with the statement I made, if the Federal Trade Commission should cast those insinuations against a Member of Congress because he introduced a bill, then I can well understand the apprehension that an attorney who appears before the Federal Trade Commission might have in appearing before a committee to testify in favor of a bill of which the Federal Trade Commission disapproves. And what has been said by some members of the staff of the Federal Trade Commission and the member who is now appearing, and the spirit in which the statements were made, I can well understand would give grounds for apprehension on the part of the attorneys appearing before the Commission that they might be recriminated against.

And when the members of an agency that is a quasi-judicial agency appears before a committee and manifests that spirit, I think it is an

unwholesome indication and a further justification of the necessity of having an adequate court review of their decisions and that is the chief thing one phase of this bill undertakes to provide.

Mr. DAVIS. We have no objection whatever or any resentment against a statement of facts, but we do object to misstatement of facts. That is all.

Mr. SADOWSKI. Of course, the committee is not aware of any attorney basing any complaints, placing any complaints or recriminations against the Commission.

Mr. REECE. They made it plain that they did not. The witness for the Commission has tried to put them in the position of having done so. I heartily agree with you, Mr. Chairman, that they did not do so, and neither did the member who introduced the bill intend any reflection. Any such insinuations by the witnesses for the Commission are unfortunate. The only explanation which immediately occurs for making them would be an inward feeling of justification for the views expressed by the proponents of the bill.

I do not think the suggestion that adequate right of appeal be provided really casts any reflection upon any one, just as providing the right to appeal from one court to another casts no reflection upon the court; that is, upon the court from which that decision is appealed.

Mr. DAVIS. I am perfectly willing to let those who know us decide. There are a large number of Members in Congress who served with and know Commissioner Ayres and me, and they know many of the others. I am willing to leave that matter as it is.

However, I think that some degree of responsibility in that regard rests upon a Member of Congress in considering a bill and voting on bills that will affect the public interest as much as this bill will, and so that is that.

Mr. Chairman and gentlemen, I do not know how many letters the author of this bill has written to people soliciting them to come and speak in favor of the bill. I have seen quite a number. And I have heard of quite a number more. And he certainly manifested very great activity in behalf of his bill, both before and in the hearings, so that is that. And he has, as I started to call your attention to, a lot of help. For instance, all along, first these magazines complained that the industry was not taking any interest in the bill and calling on them to do it, and so forth.

Here is one, Drug Trade News, July 16, 1945. The author is Mr. Robert L. Swain who appeared as a witness. Of course, his constituents are the drug people. Just before you started your vacation last summer, he had this: "See them at home. As it is now settled that Congress cannot get around to a consideration of the Reece bill until after the summer recess, we earnestly urge drug-industry members to do their best selling job on their Senators and Congressmen while they are home for the vacation period."

Mr. SADOWSKI. They evidently did a good job, because they got the hearing on the bill.

Mr. DAVIS. I have various other magazaines. This went on. Here is a full_page_calling for help. And here is another magazine, the N. A. R. D. Journal, which just came out the other day, and this article is written by George H. Frates, their Washington representative, who appeared here.

Mr. REECE. There is a picture on this side of the cover that is attracting the attention of the committee.

[Laughter.]

Mr. DAVIS. Well, there is a comparison, one of the more conservative kind.

Mr. REECE. Do you have the editorial from Printers' Ink; are you going to put that in the record?

Mr. DAVIS. I will put the editorial in, yes. Get me that editorial. I ask that it be inserted in the record.

(The matter referred to is as follows:

[From Printers' Ink, a journal for advertisers, September 1, 1938]

WE RECANT

When the late unlamented Tugwell food and drug bill was being fought by advertisers as the thoroughly iniquitous and impossible piece of legislation that it was, there was introduced into the House a measure known as the Mead bill. Sponsored by the Proprietary Association, it was written by our good friend, James F. Hoge.

We twitted Counselor Hoge quite a bit at the time-both in person and in print-for providing that the Federal Trade Commission rather than the Food and Drug Administration should enforce the proposed law.

In most other respects the bill was good-as good as the present Copeland law or perhaps in some respects, even better.

The thing that condemned it in Printers' Ink's estimation, though (and we had plenty of company) was the Federal Trade Commission angle. We believed that Federal Trade Commission enforcement would be practically the same as no enforcement. We did not question the integrity or ability of the Commissioners. But having in mind the fishing expeditions and the interminable procedure that had characterized FTC activities, we feared that the whole enforcement proposition would become so lopsided and top-heavy that it would get nowhere.

Came the Wheeler-Lea amendment to the Federal Trade Commission Act. This proposed that the Commission should have jurisdiction over the advertising of foods, drugs, cosmetics, and devices. We thought-and still think, for that matter that it would be better to give the Food and Drug Administration authority over advertising as provided for by the excellent Copeland bill which, since then, has become law. But Secretary Wallace, under whose general direction the Food Administration operates, had some jealous enemies in the House. Furthermore, the FTC, understandably enough, wanted more power. The anti-Wallace people and the pro-Commission element had their way.

Thus today we have the Copeland law setting certain standards for the production and merchandising of foods, drugs, and cosmetics. We also have the Wheeler-Lea amendment providing that the matter of enforcing advertising regulations in these commodities shall be in the hands of the Commission.

Strange to relate-and unexpectedly, too, so far as Printers' Ink is concerned— the thing works.

Last week in this paper it was shown that under FTC regulations and procedure an actual revolution in copy writing has come about in the few short months since the Wheeler-Lea amendment has gotten under way.

Advertisers have been called to account and almost without exception they have signed stipulations to the effect that in the future they will agree to abstain from certain practices.

True, they could have done all this voluntarily and under their own power. In these pages during the last 5 years they have been urged repeatedly to cleanse their advertising of what they knew was questionable. This, however, is beside the point. The fact remains that they have done it now. Advertising, as a result, is going to be more powerful as well as better. These changes, made under the Commission's prodding, will do much to keep and increase the confidence of the consumer.

Our respectful salutations, then, to the Wheeler-Lea amendment and the Federal Trade Commission.

Advertisers-including those who have been called to account--will, we believe join us in this sentiment.