Under § 5 of the Federal Trade Commission Act, the Commission
ordered respondent corporations and others to cease and desist from
certain trade practices. The Court of Appeals affirmed the order
with modifications, and commanded compliance. The decree directed
that reports of compliance be filed with the Commission within 90
days, reserved jurisdiction to enter further orders to enforce
compliance, and provided that it was without prejudice to the right
of the Government to prosecute suits to recover civil penalties for
violations of the order and to initiate contempt proceedings for
violations of the decree. Reports of compliance were filed and
accepted. Under § 6(a) and (b) of the Act and its own Rule of
Practice No. XXVI, the Commission subsequently ordered respondents
to file special reports to show continuing compliance with the
decree.
Held:
1. This order did not invade the jurisdiction of the Court of
Appeals. Pp.
338 U. S.
638-643.
(a) The Commission's continuing duty to prevent unfair methods
of competition and unfair or deceptive acts or practices in
commerce is not suspended or exhausted as to any violator whose
guilt is once established. Pp.
338 U. S.
638-639.
(b) Although the Commission's cease and desist order was merged
in the court's decree, the court neither assumed to itself nor
denied to the Commission that agency's duty to inform itself and to
protect commerce against continued or renewed unlawful practice. P.
338 U. S.
641.
(c) When investigative and accusatory duties are delegated by
statute to an administrative body like the Commission, it may take
steps to inform itself as to whether there is probable violation of
the law without first making charges that there are such
violations. Pp.
338 U. S.
641-643.
Page 338 U. S. 633
(d) The Commission's order for special reports was not made in
the name of the court or in reliance upon judicial powers, but in
reliance upon its own law-enforcing powers. P.
338 U. S.
643.
2. The order did not violate § 3(a) of the Administrative
Procedure Act. Respondents were put on notice of the possibility of
the issuance of such orders by the Commission's Rule XXVI, together
with its Statement of Organization, Procedures, and Functions,
which meet the requirements of that section. Pp.
338 U. S.
644-647.
3. The Commission's authority under § 6 of the Act to require
special reports of corporations includes special reports of the
manner in which they are complying with decrees enforcing cease and
desist orders under § 5. Pp.
338 U. S.
647-651.
(a) That this use of the Commission's power under § 6 is novel
and unprecedented in Commission practice does not require a
different result, since power granted to governmental agencies is
not forfeited by nonuser. Pp.
338 U. S.
647-648.
(b) The language of § 6 is clearly broad enough to authorize the
issuance of the order here in question. Pp.
338 U. S.
648-649.
(c) The use of information obtained in special reports under § 6
is not limited to support of general economic surveys for the
President, the Congress, or the Attorney General. It may also be
used in determining whether there has been proper compliance with
the court's decree under § 5. Pp.
338 U. S.
649-650.
(d) The special reports required by the order were of the kind
which the Commission is authorized by § 6 to require. P.
338 U. S.
650.
(e) The fact that § 5 applies to individuals, partnerships, and
corporations, while §§ 6(b) and 10 apply only to corporations, does
not require a different result. Pp.
338 U. S.
650-651.
4. The Commission's order does not contravene the Fourth
Amendment's proscription of unreasonable searches and seizures or
the due process clause of the Fifth Amendment. Pp.
338 U. S.
651-654.
(a) Law-enforcing agencies have a legitimate right to satisfy
themselves that corporate behavior is consistent with the law and
the public interest. P.
338 U. S.
652.
(b) If the inquiry is within the authority of the agency, the
demand is not too indefinite, and the information sought is
reasonably relevant, it does not exceed the investigatory power of
the Commission. P.
338 U. S.
652.
(c) On its face, the Commission's order did not transgress these
bounds. Pp.
338 U. S.
652-653.
(d) Before the courts will hold an order of the Commission
seeking information reports arbitrarily excessive, they may
expect
Page 338 U. S. 634
the supplicant to have made reasonable efforts before the
Commission itself to obtain reasonable conditions, and petitioners
made no such efforts in this case. Pp.
338 U. S.
653-654.
(e) This decision is not to be understood as holding such orders
exempt from judicial examination or as extending a license to exact
as reports what would not reasonably be comprehended within that
term as used by Congress in the context of the Act. P.
338 U. S.
654.
174 F.2d 703, reversed.
The District Court dismissed suits by the United States under §§
9 and 10 of the Federal Trade Commission Act to compel respondents
to comply with an order of the Federal Trade Commission requiring
them to file special reports, and to recover penalties for
noncompliance. 80 F. Supp. 419. The Court of Appeals affirmed. 174
F.2d 703. This Court granted certiorari. 338 U.S. 857.
Reversed, p.
338 U. S.
654.
MR. JUSTICE JACKSON delivered the opinion of the Court.
This is a controversy as to the power of the Federal Trade
Commission to require corporations to file reports showing how they
have complied with a decree of the Court of Appeals enforcing the
Commission's cease and desist order, in addition to those reports
required by the decree itself.
Page 338 U. S. 635
Proceedings under § 5 of the Federal Trade Commission Act
[
Footnote 1] culminated in a
Commission order requiring respondents Morton Salt Company and
International Salt Company, together with eighteen other salt
producers
Page 338 U. S. 636
and a trade association, to cease and desist from stated
practices in connection with the pricing, producing, and marketing
of salt. The Court of Appeals for the Seventh Circuit affirmed the
order with modifications, and commanded compliance.
Salt
Producers Assn. v. Federal Trade Comm'n, 134 F.2d 354. The
decree directed that reports of the manner of compliance be filed
with the Commission within ninety days, but it reserved
jurisdiction
"to enter such further orders herein from time to time as may
become necessary effectively to enforce compliance in every respect
with this decree and to prevent evasion thereof."
The decree expressly was
"without prejudice to the right of the United States, as
provided in Section 5(1) of the Federal Trade Commission Act, to
prosecute suits to recover civil penalties for violations of the
said modified order to cease and desist hereby affirmed, and
without prejudice to the right of the Federal Trade Commission to
initiate contempt proceedings for violations of this decree."
The reports of compliance were subsequently filed and accepted,
and there the matter appears to have rested for a little upwards of
four years.
On September 2, 1947, the Commission ordered additional and
highly particularized reports to show continuing compliance with
the decree. This was done without application to the court, was not
authorized by any provision of its decree, and is not provided for
in § 5 of the statute under which the Commission's original cease
and desist order had issued. The new order recited that it was
issued on the Commission's own motion pursuant to its published
Rule of Practice No. XXVI [
Footnote
2] and the authority granted by subsections (a) and (b) of § 6
of the Trade Commission Act. It ordered these and other parties
restrained by the earlier decree to file, within thirty days,
"additional reports showing in detail the
Page 338 U. S. 637
manner and form in which they have been, and are now, complying
with said modified order to cease and desist and said decree."
It demanded of each producer a "complete statement" of the
"prices, terms, and conditions of sale of salt, together with
books or compilations of freight rates used in calculating
delivered prices, price lists and price announcements distributed,
published or employed in marketing salt from and after January 1,
1944."
From the Salt Producers Association, it required information as
to its activities and services. The Association and some of the
producers reported satisfactorily. These two respondents did not.
Instead, each informed the Commission in general terms that it had
complied with the decree in the manner previously reported, but
that it doubted the Commission's jurisdiction to require further
reports, and declined to supply the particulars demanded. Neither
asked any hearing, or made objection to the scope of the order.
The Commission next gave respondents notices asserting their
default and calling attention to penalties provided in § 10 of the
Act. Neither respondent asked any hearing on the notice of default.
These suits were then commenced in the name of the United States in
District Court under §§ 9 and 10 of the Trade Commission Act,
asking mandatory injunctions commanding respondents to report as
directed, together with judgment against each for $100 per day
while default continued. Respondents answered. Both sides moved for
summary judgments. The court found no dispute as to material facts,
and dismissed the complaints for want of jurisdiction. 80 F. Supp.
419. The Court of Appeals, by divided vote, affirmed. 174 F.2d 703.
We granted certiorari, 338 U.S. 857, because the case involved
issues of some importance to enforcement of the Act and of court
decrees under it and under other Acts which provide similar methods
to enforce orders of administrative bodies.
Page 338 U. S. 638
The Government's suits and the Commission's order are challenged
upon a variety of grounds, not all of which were considered by the
Court of Appeals. They include contentions that (1) the order
constitutes an interference with the decree and an invasion of the
powers of the Court of Appeals; (2) the Commission's Rule XXVI is
ultra vires, and violates the Federal Administrative
Procedure Act, 60 Stat. 237, 5 U.S.C. § 1001
et seq.; (3)
the procedure is unauthorized by those sections of the Act on which
it is based; (4) it is novel and arbitrary, and violates the Fourth
and Fifth Amendments to the Constitution. For reasons given, we
reject each of these contentions.
I
. INVASION OF COURT OF APPEALS JURISDICTION
The respondents' case and the decision below are rested heavily
on this argument that the Commission is invading the province of
the judiciary. The Court of Appeals held that the Commission's
order of September 2, 1947, represented an unauthorized attempt to
enforce that court's decree. It pointed out that the statute had
made the court's own jurisdiction of the proceeding "exclusive" and
its own decree final. It considered that "every vestige of
jurisdiction" over that subject was "firmly and exclusively lodged
in [the] Court of Appeals." It noted that it had required filing of
only the original compliance reports, and that it had protected its
jurisdiction by reserving power to enter further orders necessary
to enforce compliance and prevent evasion. It thought that the
effect of the Commission's proceedings was to assert "such
jurisdiction to reside elsewhere."
It seems conceded, however, that some power or duty,
independently of the decree, must still have resided in the
Commission. [
Footnote 3]
Certainly entry of the court decree did
Page 338 U. S. 639
not wholly relieve the Commission of responsibility for its
enforcement. The decree recognized that. It left to the Commission
the right, and hence the responsibility, "to initiate contempt
proceedings for the violation of this decree." This must have
contemplated that the Commission could obtain accurate information
from time to time on which to base a responsible conclusion that
there was or was not cause for such a proceeding. The decree also
required the original report showing the manner and form of each
respondent's compliance to be filed not with the court, but with
the Commission. Presumably the Commission was expected to
scrutinize it and, if insufficient on its face, to reject it and
move the court to take notice of the default. And the duty likewise
was left upon the Commission to move the court if any respondent
made a false report. The duty would appear to be the same if a
temporary compliance were truly reported, but conduct resumed which
would violate the decree. In addition, the Trade Commission has a
continuing duty to prevent unfair methods of competition and unfair
or deceptive acts or practices in commerce. That responsibility as
to all within the coverage of the Act is not suspended or exhausted
as to any violator whose guilt is once established.
Page 338 U. S. 640
If the Commission had petitioned the court itself to order
additional reports of compliance, it could properly have been
required to present some evidence of probable violation to overcome
the "presumption of legality," of innocence, and of obedience to
the law which respondents here urge. Courts hesitate to alter or
supplement their decrees except the need be proved as well as
asserted. Evidence the Commission did not have; it had, at most, a
suspicion, or let us say a curiosity as to whether respondents'
reported reformation in business methods was an abiding one.
Must the decree, after a single report of compliance, rest upon
respondents' honor unless evidence of a violation fortuitously
comes to the Commission? May not the Commission, in view of its
residual duty of enforcement affirmatively satisfy itself that the
decree is being observed? Whether this usurps the courts' own
function is, we think, answered by consideration of the fundamental
relationship between the courts and administrative bodies.
The Trade Commission Act is one of several in which Congress, to
make its policy effective, has relied upon the initiative of
administrative officials and the flexibility of the administrative
process. Its agencies are provided with staffs to institute
proceedings and to follow up decrees and police their obedience.
While that process at times is adversary, it also at times is
inquisitorial. These agencies are expected to ascertain when and
against whom proceedings should be set in motion, and to take the
lead in following through to effective results. It is expected that
this combination of duty and power always will result in earnest
and eager action, but it is feared that it may sometimes result in
harsh and overzealous action.
To protect against mistaken or arbitrary orders, judicial review
is provided. Its function is dispassionate and disinterested
adjudication, unmixed with any concern as
Page 338 U. S. 641
to the success of either prosecution or defense. Courts are not
expected to start wheels moving, or to follow up judgments. Courts
neither have, nor need, sleuths to dig up evidence, staffs to
analyze reports, or personnel to prepare prosecutions for
contempts. Indeed, while some situations force the judge to pass on
contempt issues which he himself raises, it is to be regretted
whenever a court in any sense must become prosecutor. Those
occasions should not be needlessly multiplied by denying
investigative and prosecutive powers to other lawful agencies.
The court in this case advisedly left it to the Commission to
receive the report of compliance and to institute any contempt
proceedings. This was in harmony with our system. When the process
of adjudication is complete, all judgments are handed over to the
litigant or executive officers, such as the sheriff or marshal, to
execute. Steps which the litigant or executive department lawfully
takes for their enforcement are a vindication, rather than a
usurpation, of the court's power. In the case before us, it is true
that the Commission's cease and desist order was merged in the
court's decree; but the court neither assumed to itself nor denied
to the Commission that agency's duty to inform itself and protect
commerce against continued or renewed unlawful practice.
This case illustrates the difference between the judicial
function and the function the Commission is attempting to perform.
The respondents argue that, since the Commission made no charge of
violation either of the decree or the statute, it is engaged in a
mere "fishing expedition" to see if it can turn up evidence of
guilt. We will assume for the argument that this is so. Courts have
often disapproved the employment of the judicial process in such an
enterprise. Federal judicial power itself extends only to
adjudication of cases and controversies, and it is natural that its
investigative powers should be jealously confined
Page 338 U. S. 642
to these ends. The judicial subpoena power not only is subject
to specific constitutional limitations, which also apply to
administrative orders, such as those against self-incrimination,
unreasonable search and seizure, and due process of law, but also
is subject to those limitations inherent in the body that issues
them because of the provisions of the Judiciary Article of the
Constitution.
We must not disguise the fact that sometimes, especially early
in the history of the federal administrative tribunal, the courts
were persuaded to engraft judicial limitations upon the
administrative process. The courts could not go fishing, and so it
followed neither could anyone else. Administrative investigations
fell before the colorful and nostalgic slogan "no fishing
expeditions." It must not be forgotten that the administrative
process and its agencies are relative newcomers in the field of
law, and that it has taken and will continue to take experience and
trial and error to fit this process into our system of judicature.
More recent views have been more tolerant of it than those which
underlay many older decisions.
Compare Jones v. Securities
& Exchange Comm'n, 298 U. S. 1,
with United States v. Morgan, 307 U.
S. 183,
307 U. S.
191.
The only power that is involved here is the power to get
information from those who best can give it and who are most
interested in not doing so. Because judicial power is reluctant, if
not unable, to summon evidence until it is shown to be relevant to
issues in litigation, it does not follow that an administrative
agency charged with seeing that the laws are enforced may not have
and exercise powers of original inquiry. It has a power of
inquisition, if one chooses to call it that, which is not derived
from the judicial function. It is more analogous to the Grand Jury,
which does not depend on a case or controversy for power to get
evidence, but can investigate merely on suspicion that the law is
being violated, or
Page 338 U. S. 643
even just because it wants assurance that it is not. When
investigative and accusatory duties are delegated by statute to an
administrative body, it, too, may take steps to inform itself as to
whether there is probable violation of the law.
Of course, the Commission cannot intrude upon or usurp the
court's function of adjudication. The decree is always what the
court makes it; the court's jurisdiction to review is, and remains,
exclusive, its judgment final. What the Commission has done,
however, is not to modify, but to follow up, this decree. It has
not asked this report in the name of the court, or in reliance upon
judicial powers, but in reliance upon its own law enforcing
powers.
That Congress did not regard it as a judicial function to
investigate compliance with court decrees, at least initially, is
shown by its action as to other antitrust decrees. Section 6(c) of
the Act under consideration specifically authorizes the Commission,
on its own initiative and without leave of court, to investigate
compliance with final decrees in cases prosecuted by the Attorney
General and not involving the Commission as a party. Congress
obviously deemed it a function of the Commission, rather than of
the courts, to probe compliance with such decrees, even when it had
no part in obtaining them. It surely was not because of fear it
would involve collision with the judicial function that Congress
omitted express authorization for the Commission to follow up
decrees in its own cases. Express grant of power would only seem
necessary as to decrees in which the Commission had no other
interest.
Whether the Commission has invaded any private right of
respondents we consider under later rubrics. Our only concern under
the present heading is whether the Commission's order infringes
prerogatives of the court. We hold it does not.
Page 338 U. S. 644
II
. VIOLATION OF THE ADMINISTRATIVE PROCEDURE ACT
The Administrative Procedure Act was framed against a background
of rapid expansion of the administrative process as a check upon
administrators whose zeal might otherwise have carried them to
excesses not contemplated in legislation creating their offices. It
created safeguards, even narrower than the constitutional ones,
against arbitrary official encroachment on private rights.
Thus, § 3(a) of the Act requires every agency to which it
applies, which includes the Federal Trade Commission, to publish in
the Federal Register certain statements of its rules, organization
and procedure, "including the nature and requirements of all formal
or informal procedures available," and adds that "[n]o person shall
in any manner be required to resort to organization or procedure
not so published." In addition, § 6(b) proscribes any requirement
of a report or other investigative demand "in any manner or for any
purpose except as authorized by law."
Principally on the basis of these two sections, respondents
contend that the current order cannot be enforced except in
violation of the Administrative Procedure Act. Have the respondents
been ordered to comply with procedure of which they were not put on
notice by publication in the Federal Register? And, to the extent
that the procedure had been defined and published, was it
authorized by law?
The pertinent provisions of the Administrative Procedure Act
became effective September 11, 1946. On December 11, 1946, the
Federal Trade Commission published in the Federal Register its
Rules of Practice, 11 Fed.Reg. 14233-14239. The Commission's Rule
XXVI,
id. 14237, republished without change in 12 Fed.Reg.
5444, 5448, sets the time limit for filing initial reports of
compliance with Commission orders, and asserts the Commission's
right to require, within its sound discretion, the
Page 338 U. S. 645
filing of further compliance reports thereafter. [
Footnote 4] In § 7.12 of its Statement of
Organization, Procedures, and Functions, 12 Fed.Reg. 5450, 5452,
the Commission restated its right to require by order "such
supplemental reports of compliance as it considers warranted," and
defined the contents of such a report. [
Footnote 5]
Page 338 U. S. 646
We conclude that the Commission's published Rule XXVI announced
the right it claims in this case to demand of a party against whom
an enforcement decree has been entered that it
"file with the Commission, from time to time thereafter, further
reports in writing, setting forth in detail the manner and form in
which they are complying with said order. . . ."
Taken together with the Commission's Statement of Organization,
Procedures, and Functions,
supra, if indeed not by itself,
Rule XXVI amply met the requirements of § 3(a) of the
Administrative Procedure Act.
Respondents hardly challenge this conclusion. Theirs is the more
subtle argument that requirement of supplemental reports following
court enforcement of a Commission order is unauthorized by statute
and
ultra vires, so that no valid notice of Rule XXVI had
been or could be given, as required by § 3(a) of the Administrative
Procedure Act. Also, it is said to be in direct violation of § 6(b)
of that Act. This leads to the question of statutory authority for
the order to report, a question we must determine even apart from
consideration of the Administrative Procedure Act. Accordingly, we
turn to the Federal Trade Commission Act itself to see whether it
contains statutory authority for the Commission's Rule XXVI, as
well as for its order here sought to be enforced, issued, as it
was, pursuant to the procedures proclaimed
Page 338 U. S. 647
in that Rule. If we find such statutory authority, we must
conclude that the objections under the Administrative Procedure Act
are taken in vain.
III
. STATUTORY AUTHORITY TO REQUIRE REPORTS
The Court of Appeals found the Commission to be without
statutory authority to require additional reports as to compliance.
Section 6 of the Federal Trade Commission Act, it thought, could
not be invoked in connection with a decree sought and entered
pursuant to § 5, which sections the court regarded as insulated
from each other and directed to wholly different situations.
Section 6, so it was held, authorized requirements only of "special
reports" supplemental to "annual reports," and could not be
authority for requiring special reports supplemental to a report of
compliance required by court decree in a § 5 case.
At the root of this position lies the elaborate and plausible
argument of respondents that §§ 5 and 6 of the Act set up
self-sufficient, independent, and exclusive procedures for dealing
with different matters, and that therefore neither section can be
supported or aided by the other. Respondents also say that the
present use of the asserted power is novel and unprecedented in
Commission practice, and introduces a new method of investigating
compliance. Respondents are not without statements by the
Commission or its officials, dicta from judicial opinions, views of
text writers, and facts of legislative history which give some
support to this theory. But this Court never before has been called
upon to deal consciously and squarely with the subject.
The fact that powers long have been unexercised well may call
for close scrutiny as to whether they exist; but, if granted, they
are not lost by being allowed to lie dormant, any more than
nonexistent powers can be prescripted by an unchallenged exercise.
We know that unquestioned powers are sometimes unexercised from
lack
Page 338 U. S. 648
of funds, motives of expediency, or the competition of more
immediately important concerns. We find no basis for holding that
any power ever granted to the Trade Commission has been forfeited
by nonuser.
The Commission's organic Act, § 5, comprehensively provides
substantive and procedural rules for checking unfair methods of
competition. The procedure is complete from complaint and service
of process through final order, court review, and enforcement
proceedings to recover penalties which are not those here sued for.
This entire subject of unfair competition, it is true, came into
the bill late in its legislative history, and dealt with a
commercial evil quite different from the target of prior antitrust
laws. It is to be noted, however, that, although complete
otherwise, this section confers no power to investigate this or any
other matter. That power, without which all others would be vain,
must be found in other sections of the Act. The Commission, for
power to investigate compliance with a § 5 order, has turned to §
6, which authorizes it to require certain reports but is not
expressly applicable to a § 5 case. Respondents say it might better
have turned to § 9, which authorizes it to send investigators to
examine their books, copy documents, and issue subpoenas, and which
is expressly applicable to § 5 proceedings.
Section 6, on which the Commission relies, among other things,
and with exceptions not material, adds the power
"to investigate from time to time the organization, business,
conduct, practices, and management of any corporation engaged in
commerce, . . . and its relation to other corporations and to
individuals, associations, and partnerships."
It also authorizes the Commission
"to require, by general or special orders, corporations engaged
in commerce . . . to file with the commission, in such form as the
commission may prescribe, annual or special, or both annual and
special, reports or answers in writing
Page 338 U. S. 649
to specific questions, furnishing to the commission such
information as it may require as to the organization, business,
conduct, practices, management, and relation to other corporations,
partnerships, and individuals of the respective corporations filing
such reports or answers in writing."
To one informed of no fact apart from this text, it would appear
to grant ample power to order the reports here in question.
Respondents are in the class subject to inquiry, the call is for
what appears to be a special report, and the matter to be reported
would seem to be as to business conduct and practices about which
the Commission is authorized to inquire. But respondents advance
several arguments to persuade us that this seemingly comprehensive
power is subject to limitations not evident in the text.
Respondents derive from legislative history their contention
that Congress divided the duties and powers of the Commission into
two separate categories -- one in § 6 merely reenacting the old
powers of investigation and publicity in antitrust matters --
"essentially a mere continuance of the former powers of the old
Bureau of Corporations." The other was a new unfair competition
power, self-contained and sealed off in § 5. It is argued that the
reports set forth in § 6 can be required only "in support of
general economic surveys, and not in aid of enforcement proceedings
under Section 5."
While we find a good deal which would warrant our concluding
that § 6 was framed with the preexisting antitrust laws in mind,
and in the expectation that the information procured would be
chiefly useful in reports to the President, the Congress, or the
Attorney General, we find nothing that would deny is use for any
purpose within the duties of the Commission, including a § 5
proceeding. A construction of such an Act that would allow
information to be obtained for only a part of a Commission's
functions, and would require the Commission
Page 338 U. S. 650
to pursue the rest of its duties as if the information did not
exist would be unusual, to say the least. The information was such
as the Commission was authorized to obtain, and we think it could
be required for use in determining whether there had been proper
compliance with the court's decree in a § 5 case.
It is argued, however, and the court below has agreed, that the
"special report" authorized by statute does not embrace the one
here asked as to the method of compliance with the decree. We find
nothing in the legislative history that would justify so limiting
the meaning of special reports, or holding that the report here
asked is not such a one. The very House Committee Report (H.R.Rep.
No.533, 63d Cong., 2d Sess.) which the court below thought
sustained respondents' contention we read, in its context, to
support the Commission. Speaking of what became this section, the
Report said,
"The commission, under this section, may also require such
special reports as it may deem advisable. By this means, if the
ordinary data furnished by a corporation in its annual reports does
not adequately disclose its organization, financial condition,
business practices, or relation to other corporations, there can be
obtained by a special report such additional information as the
commission may deem necessary."
Id. at p. 4. An annual report of a corporation is a
recurrent and relatively standardized affair. The special report
was used to enable the Commission to elicit any information beyond
the ordinary data of a routine annual report. If the report asked
here is not a special report, we would be hard put to define
one.
Nor does the fact that § 5 applies to individuals, partnerships,
and corporations, while §§ 6(b) and 10 apply only to corporations,
lead us to conclude that the Act must not be read as an integrated
whole. The argument that, because the reporting and penalty
provisions of the latter extend only to corporations, they must not
be invoked to implement, as against corporations, a § 5
proceeding
Page 338 U. S. 651
which contemplates action against persons and partnerships as
well would have force were there not sound reason for more drastic
powers to compel disclosure from corporations than from natural
persons. What the former may be compelled to disclose without
objection, the latter may withhold, or reveal only after exacting
the price of immunity from prosecution. Corporations not only have
no constitutional immunity from self-incrimination, but the
disparity between artificial and natural persons is so significant
that differing treatment can rarely be urged as an objection to a
particular construction of a statute. Moreover, Congress may have
considered that the volume or proportion of unincorporated
business, or the relatively small size of individually owned
enterprises, or even a lesser capacity and disposition to resist,
made it possible to omit persons from duties and penalties imposed
on artificial combinations of capital.
We conclude that the authority of the Commission under § 6 to
require special reports of corporations includes special reports of
the manner in which they are complying with decrees enforcing § 5
cease and desist orders.
IV
. RIGHTS UNDER FOURTH AND FIFTH AMENDMENTS
The Commission's order is criticized upon grounds that the order
transgresses the Fourth Amendment's proscription of unreasonable
searches and seizures and the Fifth Amendment's due process of law
clause.
It is unnecessary here to examine the question of whether a
corporation is entitled to the protection of the Fourth Amendment.
Cf. Oklahoma Press Publishing Co. v. Walling, 327 U.
S. 186. Although the "right to be let alone -- the most
comprehensive of rights and the right most valued by civilized
men," Brandeis, J., dissenting in
Olmstead v. United
States, 277 U. S. 438,
277 U. S. 471
at
277 U. S. 478,
is not confined literally to searches and seizures
Page 338 U. S. 652
as such, but extends as well to the orderly taking under
compulsion of process,
Boyd v. United States, 116 U.
S. 616;
Hale v. Henkel, 201 U. S.
43,
201 U. S. 70,
neither incorporated nor unincorporated associations can plead an
unqualified right to conduct their affairs in secret.
Hale v.
Henkel, supra; United States v. White, 322 U.
S. 694.
While they may and should have protection from unlawful demands
made in the name of public investigation,
cf. Federal Trade
Comm'n v. American Tobacco Co., 264 U.
S. 298, corporations can claim no equality with
individuals in the enjoyment of a right to privacy.
Cf. United
States v. White, supra. They are endowed with public
attributes. They have a collective impact upon society, from which
they derive the privilege of acting as artificial entities. The
Federal Government allows them the privilege of engaging in
interstate commerce. Favors from government often carry with them
an enhanced measure of regulation.
Cf. Graham v. Brotherhood of
Locomotive Firemen, 338 U. S. 232;
Steele v. Louisville & Nashville R. Co., 323 U.
S. 192;
Tunstall v. Brotherhood of Locomotive
Firemen & Engineers, 323 U. S. 210;
Wickard v. Filburn, 317 U. S. 111, at
317 U. S. 129.
Even if one were to regard the request for information in this case
as caused by nothing more than official curiosity, nevertheless law
enforcing agencies have a legitimate right to satisfy themselves
that corporate behavior is consistent with the law and the public
interest.
Of course, a governmental investigation into corporate matters
may be of such a sweeping nature and so unrelated to the matter
properly under inquiry as to exceed the investigatory power.
Federal Trade Comm'n v. American Tobacco Co., supra. But
it is sufficient if the inquiry is within the authority of the
agency, the demand is not too indefinite, and the information
sought is reasonably relevant.
"The gist of the protection is in the requirement, expressed in
terms, that the disclosure
Page 338 U. S. 653
sought shall not be unreasonable."
Oklahoma Press Publishing Co. v. Walling, 327 U.
S. 186,
327 U. S. 208.
Nothing on the face of the Commission's order transgressed these
bounds.
Nor do we consider whether, for reasons peculiar to these cases
not apparent on the face of the orders, these limits are
transgressed. Such questions are not presented by the procedure
followed by respondents. Before the courts will hold an order
seeking information reports to be arbitrarily excessive, they may
expect the supplicant to have made reasonable efforts before the
Commission itself to obtain reasonable conditions. Neither
respondent raised objection to the order's sweep, nor asked any
modification, clarification, or interpretation of it. Both
challenged, instead, power to issue it. Their position was that the
Commission had no more authority to issue a reasonable order than
an unreasonable one. That, too, was the defense to this action in
the court below.
Of course, there are limits to what, in the name of reports, the
Commission may demand. Just what these limits are we do not attempt
to define in the abstract. But it is safe to say that they would
stop the Commission considerably short of the extravagant example
used by one of the respondents of what it fears if we sustain this
order -- that the Commission may require reports from automobile
companies which include filing automobiles. In this case, we doubt
that we should read the order, as respondents ask, to require
shipment of extensive files or gifts of expensive books. This is
not a necessary reading, certainly, and other parties to the decree
seem to have been able to satisfy its requirements.
If respondents had objected to the terms of the order, they
would have presented, or at least offered to present, evidence
concerning any records required, and the cost of their books,
matters which now rest on mere assertions in their briefs. The
Commission would have had opportunity
Page 338 U. S. 654
to disclaim any inadvertent excesses or to justify their demands
in the record. We think these respondents could have obtained any
reasonable modifications necessary, but, if not, at least could
have made a record that would convince us of the measure of their
grievance, rather than ask us to assume it.
It is argued that, if we sustain this use of § 6, the power will
be unconfined, and its arbitrary exercise subject to no judicial
review or control, unless and until the Government brings suit, as
here, for penalties. The Government, it is said, may delay such
action while ruinous penalties accumulate and defendant runs the
risk that his defenses will not be sustained. However, we are not
prepared to say that courts would be powerless if, after an effort
to clarify or modify such an order, it still is considered to be so
arbitrary as to be unlawful, and the Government pursues a policy of
accumulating penalties while avoiding a judicial test by refusing
to bring action to recover them. Since we do not think this record
presents the question, we do not undertake to determine whether the
Declaratory Judgments Act, the Administrative Procedure Act, or
general equitable powers of the courts would afford a remedy if
there were shown to be a wrong, or what the consequences would be
if no chance is given for a test of reasonable objections to such
an order.
Cf. Oklahoma Operating Co. v. Love, 252 U.
S. 331. It is enough to say that, in upholding this
order upon this record, we are not to be understood as holding such
orders exempt from judicial examination or as extending a license
to exact as reports what would not reasonably be comprehended
within that term as used by Congress in the context of this
Act.
The judgment accordingly is
Reversed.
MR. JUSTICE DOUGLAS and MR. JUSTICE MINTON took no part in the
consideration or decision of these cases.
* Together with No. 274,
United States v. International Salt
Co., also on certiorari to the same court.
[
Footnote 1]
The Federal Trade Commission was established, under the Federal
Trade Commission Act, 38 Stat. 717, as amended 52 Stat. 111, 1028,
15 U.S.C. § 41
et seq., to prevent unfair methods of
competition and unfair or deceptive acts or practices in interstate
commerce by certain persons, partnerships or corporations. Under §
5(b) of that Act, the Commission is empowered and directed,
following suitable hearing and determination, to order that those
found guilty of such practices cease and desist therefrom, and,
under §§ 5(c) and 5(d), exclusive jurisdiction to affirm, enforce,
modify, or set aside such orders is placed in the appropriate Court
of Appeals, whose judgment and decree are final except insofar as
they may be subject to review here. Civil penalties for violations
of cease and desist orders are provided for, § 5(1), to be
recovered in civil actions brought by the United States. Under §§
6(a) and 6(b) of the Act, the Commission is authorized to compile
information concerning, and to investigate, the organization,
business, conduct, practices, and management of any corporation
within its jurisdiction, and to require any such corporation to
file "annual or special, or both annual and special, reports or
answers in writing to specific questions," concerning such
information. For the purposes of the Act, the Commission is
empowered, in § 9, to examine and copy documentary evidence of any
corporation being investigated or proceeded against, and to require
attendance of witnesses and production of all such documentary
evidence. The same section also gives District Courts jurisdiction
to compel compliance with the subpoena, as well as other provisions
of the Act or any order of the Commission made in pursuance
thereof. And, finally, in § 10, it is provided that,
"If any corporation required by this Act to file any annual or
special report shall fail so to do within the time fixed by the
commission for filing the same, and such failure shall continue for
thirty days after notice of such default, the corporation shall
forfeit to the United States the sum of $100 for each and every day
of the continuance of such failure, which forfeiture . . . shall be
recoverable in a civil suit in the name of the United States. . .
."
The present action was brought to compel the filing of reports
ordered by the Commission and for money judgment under § 10 for
respondents' default to do so.
[
Footnote 2]
See note 4
infra.
[
Footnote 3]
For example, one of the respondents frankly states:
". . . At no time has this respondent attempted to argue that it
was immune to investigation by the Federal Trade Commission simply
by virtue of the original case's having come within the
jurisdiction of the Court of Appeals. This respondent assumes that,
in some manner or other, the Commission can, if it chooses,
continue to police the compliance of this respondent by appropriate
investigatory procedures. Whether or not the appropriate procedure
is (a) by petitioning the Court of Appeal for permission to
investigate the respondent with a view to possible contempt or
Section 5(1) proceedings, (b) by an assertion of a right of
investigation under Section 9, even though it be an investigation
supplemental to a Court of Appeals decree, or (c) by an assertion
of an alleged inherent right of investigation under Section 5, is a
matter of law not at issue in this case, and it represents an issue
as to which this respondent at the moment is completely
indifferent. . . ."
[
Footnote 4]
"§ 2.26.
Reports showing compliance with orders and with
stipulations. (a) In every case where an order to cease and
desist is issued by the Commission for the purpose of preventing
violations of law, and in every instance where the Commission
approves and accepts a stipulation in which a party agrees to cease
and desist from the unlawful methods, acts, or practices involved,
the respondents named in such orders and the parties so stipulating
shall file with the Commission, within sixty days of the service of
such order and within sixty days of the approval of such
stipulation, a report, in writing, setting forth in detail the
manner and form in which they have complied with said order or with
said stipulation;
Provided, however, That if, within the
said sixty (60) day period, respondent shall file petition for
review in a circuit court of appeals, the time for filing report of
compliance will begin to run
de novo from the final
judicial determination. . . ."
"(b) Within its sound discretion, the Commission may require any
respondent upon whom such order has been served and any party
entering into such stipulation, to file with the Commission, from
time to time thereafter, further reports in writing, setting forth
in detail the manner and form in which they are complying with said
order or with said stipulation. . . ."
[
Footnote 5]
"§ 7.12.
Compliance and enforcement. (a) Reports of
compliance with orders to cease and desist are required in
accordance with the provisions of § 2.26 of the rules of practice.
The Commission may by order require such supplemental reports of
compliance as it considers warranted. Reports of compliance must
consist of a full statement showing the manner and form in which
the order has been complied with. Mere statements that the
respondent is not violating the order are not acceptable. A factual
showing is required sufficient to enable the Commission to appraise
the manner and form of compliance."
"(b) After an order to cease and desist issued by the Commission
pursuant to the Federal Trade Commission Act has become final as
provided for under section 5 of that act, and the Commission has
reason to believe that a respondent has violated such order, it
shall certify the facts concerning the violation to the Attorney
General, who may institute a suit in one of the District Courts of
the United States for the recovery of civil penalties as provided
in the act. In proceedings under the Federal Trade Commission Act,
where a Circuit Court of Appeals of the United States has by decree
commanded obedience to the Commission's order, enforcement may be
accomplished by way of contempt proceedings in the Circuit Court.
With respect to orders under the various provisions of the Clayton
Act, enforcement must be accomplished by way of contempt
proceedings. . . ."