Federal Trade Commission v. Mandel Brothers, Inc.

PETITIONER:Federal Trade Commission
RESPONDENT:Mandel Brothers, Inc.
LOCATION:Union Station

DOCKET NO.: 234
DECIDED BY: Warren Court (1958-1962)
LOWER COURT: United States Court of Appeals for the Seventh Circuit

CITATION: 359 US 385 (1959)
ARGUED: Mar 23, 1959
DECIDED: May 04, 1959

Facts of the case

Question

Audio Transcription for Oral Argument – March 23, 1959 in Federal Trade Commission v. Mandel Brothers, Inc.

Earl Warren:

The — before you proceed, Mr. Friedman, I just — I just say you don’t need to be seated.

The order — the other orders, that court appear upon the list certified by the Chief Justice and filed with the clerk and will not be orally announced.

Thank you for very much — now, Mr. Friedman, you may proceed.

Daniel M. Friedman:

Mr. Chief Justice and may it please the Court.

The principal issue in this case which is here on a writ of certiorari to the Court of Appeals for the Seventh Circuit is whether the prohibitions in the Fur Product Labeling Act against false and deceptive invoicing are applicable to invoicing at the retail level, that is when a retail courier sells a fur product to the ultimate consumer.

There’s a second issue in the case which I’ll discuss subsequently dealing with the scope of the cease-and-desist order entered by the Federal Trade Commission in this case.

At the outset, I would just like to sketch briefly for the Court, since this is the first time this statute is before the Court, what in broad terms it purports to do and why we believe that the court below has misconstrued it.

The Fur Product Labeling Act was passed in 1951 after extensive congressional consideration by three different congresses.

One thing we think that stands out in connection with the history of this Act is that there was a clear congressional purpose to protect the ultimate consumer of fur products.

The statute basically sets up in Section 3 a general prohibition against the sale or distribution of fur or fur products which are falsely or deceptively invoiced, falsely or deceptively advertised or misbranded.

And then the section of the statute goes on in the next two sections and specifies the conditions under which that event would occur.

It states to them basically the provisions are substantially the same.

It states that a fur product is misbranded if there is not attached to it a label which sets forth a certain specified items of information, particularly the name of the animal in accordance with a certain standard, the country of origin of imported furs.

And if in fact there was any used fur, any inferior part of the animal or any dyed fur, that information must be set forth on the label.

Similarly, the statute goes on and requires substantially the same information to be attached to an invoice.

Is there any difference between the courier in the information that goes on the label and require you to go on the label on that statute, or require your to go in the invoice?

Daniel M. Friedman:

Only in one minor particular.

The label requires the name of the manufacturer, the invoice requires the name and address of the seller.

Other than that, they are substantially the same.

I want to emphasize at the outset that when we speak of labels in this field, we do not refer to the traditional kind of label of a piece of cloth that is sown on the lining of the garment.

The label that are used in this business are really called, really tags.

They set forth two examples on the page 64(a) of the record and 66(b) of the record, that these little tags that are attached either to the arm of the garment or to the button, and they just hang there.

And we think this is very crucial because as I shall develop in a moment, we think that the temporary character of the label or the tag means that merely giving this information to the purchaser by this means does not give the purchaser the full measure of protection which we think Congress intended.

We think that Congress intended to go beyond this, and also to give her as a permanent record, the information contained on the invoice.

The respondent in this case operates a large department store in the City of Chicago, and after proper administrative proceedings, the Federal Trade Commission entered a cease-and-desist order finding that respondent had violated all three of these provisions, misbranding, false and deceptive invoicing and false and deceptive advertising.

The Court of Appeals modified the order with respect to misbranding, finding it was too broad in scope.

And in addition, completely struck the provision relating to false invoicing.

The Court reached this conclusion solely by looking to the statutory definition of invoice and it ruled that this definition was so clear on its face that there was no need to have resort to legislative history.

And we think that this construction is erroneous because first, we believe that the definition of invoice when viewed in light of the other provisions of the Act, does apply to retail invoicing and particularly when the legislative history in the purpose of Congress in passing the statute be considered.

And I would now like to turn to the specific statutory provisions involved in this case, which is set forth through pages 36 and 37 of our brief.

Felix Frankfurter:

Before you go on, may I ask whether this woman goes into a fur shop and buy the fur and she gets slippers, is that an invoice within the statute?

Daniel M. Friedman:

We believe it is, Mr. Justice.

Felix Frankfurter:

Does the — the usual thing that’s rolled off a cash register?

Daniel M. Friedman:

Yes, we believe —

Felix Frankfurter:

That’s an invoice within — under your submission, that’s an invoice within the terms of this statute.

Daniel M. Friedman:

That is correct, Mr. Justice.

Charles E. Whittaker:

Mr. Friedman, might I ask you (Inaudible)

Felix Frankfurter:

No, Mr. Justice.

We think that the statute does require an invoice because in Section 5 (b) it states at page 39 of our brief that a fur product shall be considered to be falsely or deceptively invoiced if such fur product or fur is not invoiced to show.

We believe this is a mandatory requirement of invoicing.

The statute in Section 3 deals with misbranding, false invoicing and false advertising —

May I ask one question just to get my thinking straight.

Your position, as I understand is for retail costumer.

He gets two pieces of paper, one, on label and the other on invoice, is that it?

Daniel M. Friedman:

That’s correct, Mr. —

All of which contains the same information.

Daniel M. Friedman:

Substantially is —

Well, it’s identity is the same information except the name of the manufacturer (Inaudible) on the invoice.

Daniel M. Friedman:

And we believe that is so, Mr. Justice, because we think the protection which Congress intended to give the consumer is not adequately met by merely giving him the label, not —

Not argument to the rights or wrongs.

Daniel M. Friedman:

I — I just like to develop that for a moment because I think —

Felix Frankfurter:

But before you do that, let me clear up one more doubt in my mind.

If furs were shipped from Chicago to Washington with tags or label, whatever label may require, and sold to a local buyer in Washington, to the district, I suppose it’s certainly arguable that that sale of that piece of fur sent without tags in Chicago to a — I withdraw to the district (Inaudible) from Chicago to New York and take away the problem of the district.

Furs were shipped from Chicago to New York for sale by retail merchant in New York, and that fur is bought by a woman in New York.

I suppose it’s certainly arguable, I’m not clear about it that the — assuming there’s a violation of the statute in that misbrand of tag, the sale in New York would still subject the — the shipper from Chicago to the prohibitions of the Act, and — and if their commerce would not have been exhausted in that point, is that right?

Daniel M. Friedman:

That is as we —

Felix Frankfurter:

However, in also the invoice which the retail dealer in New York gives to the woman within the statute?

Daniel M. Friedman:

We think it is, Mr. Justice.

We think the —

Felix Frankfurter:

You mean — a piece of fur sold by whoever sales crime lord pulls the furs to New York to a Mrs. Jordans.

Felix Frankfurter:

And he gives him a cash slip, that’s within the statute?

Daniel M. Friedman:

I have to inquire when you speak of the word “furs”.

The statute for the distinction between the raw, the pelts and the fur product.

Felix Frankfurter:

All right.

Suppose the pelt — as the woman buys a pelt in order to have it made by some other maker or tailor, whatever it is, whatever you call it.

Is that piece of paper also within the Act?

Daniel M. Friedman:

Not in the case of the intrastate sale of the piece of fur.

There is —

Felix Frankfurter:

The fur — the — the misbranding of the piece of fur which has reached New York from Chicago would be within (Voice Overlap) within the Act.

Daniel M. Friedman:

That is — that is correct.

Felix Frankfurter:

That’s one thing, but would the sale of that piece of pelt in a cert of saying it costs $673 and indicating (Inaudible) or whatever it is, (Inaudible), whatever it is.

Would that — would that piece of paper be within the Act?

Daniel M. Friedman:

Not if it was a wholly intrastate sale and that —

Felix Frankfurter:

But not give the — all of that facts there what a (Voice Overlap) —

Daniel M. Friedman:

That would — that would not be because the way the statute is set up in Sections 3 (a), (b) and (c) does a prohibition on false invoicing of furs shipped in interstate commerce.

Felix Frankfurter:

Yes.

Daniel M. Friedman:

There’s a prohibition on false invoicing of fur products shipped in interstate commerce.

But there is only a further prohibition on false invoicing of fur products shipped in intrastate commerce.

There is no prohibition in other words upon false invoicing.

It’s not applicable to false invoicing of furs, which are shipped in intrastate commerce.

Felix Frankfurter:

Well, mine is — my — my hypothesis of the shipment in — in interstate commerce, no doubt about that.

But the sale of a particular piece of pelt is — is what normally would be deemed a local transaction.

Now, I want to know whether the execution of that intrastate shipment when it gets into the hand of an individual customer is within — deemed to be within the Act.

Daniel M. Friedman:

Not insofar as the ultimate sale is made within the City of New York.

The previous transmission of the fur from Chicago to New York would be the ultimate sale by which the merchant in New York gives the fur pelt over to the woman.

That is not covered.

Felix Frankfurter:

Including also the misbranded label, was that not even in the Act, although the misbranded label comes from Chicago?

Daniel M. Friedman:

Yes, because the Act thwarts the distinction between invoicing of furs and — no, I — I have to — sorry, I have to retract that answer, Mr. Justice Frankfurter, because the fur product is not required to be labeled when sold in intrastate commerce.

I’m sorry, the fur is not permitted to be labeled in intrastate commerce.

The fur product is.

Daniel M. Friedman:

Other words —

Felix Frankfurter:

The finished coat, finished jacket or whatever you call it, the finished piece of fur, ready to wear, sent from Chicago to New York.

If sold in the conditions which it had been transported with a misbranded label, would subject who, the manufacturer or the seller?

Daniel M. Friedman:

Both.

Felix Frankfurter:

Both.

Daniel M. Friedman:

Both.

Felix Frankfurter:

But the piece of paper by which is requisite what it cost, designating what the nature of the fur is, would not be or —

Daniel M. Friedman:

No, Mr. Justice.

Felix Frankfurter:

That would be too?

Daniel M. Friedman:

That would be too in the case of the fur coat but not in the case of the skin, because we think the basic purpose was to protect the consumer of the fur products.

And the statutory scheme as we read it provides first for prohibitions on misbranded and falsely invoiced fur products shipped in interstate commerce.

That is in Section 3 (a).

And then in section —

Felix Frankfurter:

And what was — what was the fact here?

Daniel M. Friedman:

In fact the facts —

Felix Frankfurter:

— compared to — where did the fur — what was it, a fur product or a fur —

Daniel M. Friedman:

These are —

Felix Frankfurter:

— a piece of fur to wear?

Daniel M. Friedman:

No, these are fur products, fur coats and these — most of these were purchased in — manufactured in New York and shipped to Chicago.

Felix Frankfurter:

The other way around.

Daniel M. Friedman:

Now, the Court of Appeals picked up the definition of invoice in Section 2 (f) of the Act, at page 36 of our brief.

I’d like to read to the Court.

It says, “The term “invoice” means a written account, a memorandum, list or catalog, which is issued in connection with any commercial dealing in fur products or furs and described the particulars of any fur products or furs transported or delivered to a purchaser, consignee, factor, bailee, correspondent, or agent, or any other person who is engaged in dealing commercially in fur products or furs.”

The Court of Appeals stated that under this definition, an invoice at the retail level is not covered because the Court said first, “The invoice which is given by the retail dealer to the consumer is not issued in connection with any commercial dealing in fur products or furs.

Secondly,” the Court said, “that the last clause of this definition or any other person who is engaged in dealing commercially in fur products or furs must be read back as modifying not only any other person but also agent, bailee, or purchaser and therefore, it reasons that since the retail purchaser is not engaged in dealing commercially in fur products or furs, the sales slip given to that purchaser is not an invoice within the meaning of the statute.”

We believe that this reading of the statute is too narrow.

We think that a fair reading of the statute is that Congress state that the term “invoice” means a written account or memorandum issued in connection with any commercial dealing in fur products or furs.

And we think clearly, the sale by the retail store to the customer is a commercial dealing in fur product, which is — delivered to a purchaser, consignee, etcetera.

In other words, Congress specified a number of particular individuals to whom an invoice must be given, and then added a catch-all phrase covering any other person who is engaged in dealing commercially in fur product or furs.

We believe that this result follows not only from the language of this statute itself but further from the basic congressional policy reflected in the history of this Act.

Daniel M. Friedman:

The Act in the committee report states its purpose is being to protect consumers and others against false and deceptive advertising, false and deceptive invoicing and misbranding.

We have set forth in our brief some of the legislative history of this statute which shows that when the Act first came before the committees for consideration, witnesses of the fur industry testified as to the importance to the retail consumer of a good invoice.

It’s true.

They stated in this connection that they thought an invoice was better than a label and they made this contention as my adversary emphasizes because they didn’t want any legislation.

They said, “Don’t require us to label, but if we have to do anything, an invoice is preferable to a label.”

Now, Congress didn’t accept that view.

Congress included a ban in Section 3 (b) upon the manufacture for sale of any fur product made in whole or in part of fur shipped in interstate commerce, which is misbranded or falsely or deceptively advertised or falsely or deceptively imports.

The testimony before the Congress also emphasize the importance of invoicing because of the transitory character of the label which hangs on the coat.

As one of the witnesses representing the fur industry stated to the Court, purchases “are more likely to throw away a tag than a proper invoice.”

Now, the construction adopted by the Court of Appeals would have this effect, all the way along the chain of transactions by which a fur coat is manufactured and gets to the hand of the ultimate consumer, there is both the label and an invoice.

However, at the time the ultimate consumer gets the coat, at this point, it’s cut short.

All she gets is the tag, this little thing hanging there, which I think it’s a fair inference, people will have to throw away.

The invoice which would be —

And does your wife keep her invoice as to the salesperson (Inaudible)

Daniel M. Friedman:

Unfortunately, Mr. Justice, my wife doesn’t have a fur coat.

But I — [Laughter] I would — at least on the basis of what I know of this case now if she does get a fur coat, I will certainly urge her to keep her invoice.[Laughter]

Felix Frankfurter:

Do you think the invoice is more permanent than the tag?

Daniel M. Friedman:

I believe so and I believe the —

Felix Frankfurter:

Why do you believe that?

Daniel M. Friedman:

Because the — first, the testimony before the Congress indicated that.

And secondly, I think —

Felix Frankfurter:

I can understand that the — the retailer would keep invoice to — from his manufacturer, but the ultimate consumer keeps invoice.

Daniel M. Friedman:

I — I would —

Felix Frankfurter:

Top of my knowledge, a women is very limited to make those.

Daniel M. Friedman:

I — I would think so, Mr. Justice.

I think it’s — it’s the kind of a thing that would be necessary.

In our brief, we have set forth in one of the footnotes a rather dramatic example of what happened with respect to an invoice.

The story is told of a woman who came to the Hollander Company and said she’d purchased a — what have been told to her was a Hollanderized fur, and it just didn’t look very well.

When the man took a look at it and said, “This isn’t a Hollanderized fur.”

He said, “Where did you buy it?”

Daniel M. Friedman:

And she said, “I bought it in a neighbor store.”

He said, “Well, do you have your invoice?”

And she said, “Yes.”

He said, “Fine, you go back and tell him this is not a Hollanderized fur.”

She went back and was able to have some adjustment to get her money back.

I — I think that this kind of a invoice which contains this information is a vital link to the consumer in getting the measure of protection which Congress intend.

Hugo L. Black:

Suppose the Court of Appeals is right, what in your judgment is a scope of protection given by the Act as construed by that.

Daniel M. Friedman:

Well, the only protection as construed by the Court of Appeals is that when she comes in to buy the fur coat, there has to be attached to this coat the label, but there is no permanent record given to her and I point out, Mr. Justice, that these tags are the kind of thing that are going to be — have to be clipped off when the coat as taken out of the consumer by the box and she takes it with her.

I think it’s common understanding that we generally tend to clip these things off and throw them away.

Hugo L. Black:

And under your — excuse me.

Felix Frankfurter:

I beg your pardon.

Hugo L. Black:

Under you construction, then what — what is the scope of the protection given to the —

Felix Frankfurter:

In addition to that, she is required to be given this invoice which contains this important information which Congress thought consumers of fur product should have.

She gets —

Hugo L. Black:

Does any of this — does the — the Act has construed either way, affect the right of the merchant who buys the fur?

Does he get any protection from it at all under the construction?

Daniel M. Friedman:

Yes.

There’s no — there’s no question, Mr. Justice Black that the merchant gets both the invoice and the label.

That is required under the Act.

The only —

Hugo L. Black:

He — he is entitled to that under the Act, that’s conceded.

Daniel M. Friedman:

That is conceded.

The only issue was whether the ultimate retail consumer is entitled to the protection of the invoice.

Hugo L. Black:

Of both — of both.

Daniel M. Friedman:

That’s correct, Mr. Justice.

Felix Frankfurter:

Why do you say that this tag isn’t the ordinary label that is put on, piece of the clothing?

Why do you say that?

Daniel M. Friedman:

Well, it’s not a label in the sense of something sewn in —

Felix Frankfurter:

I — I heard you say that, but why do you say that?

Daniel M. Friedman:

Well, first, the particular type of tag itself and secondly, again —

Felix Frankfurter:

You mean in this case, I’m talking about generally on the labels in the — in the normal colloquial sense of the term sewn unto the furs that people buy, that women buy?

(Voice Overlap) —

Daniel M. Friedman:

I don’t believe they are in this industry, Mr. Justice.

And I —

Felix Frankfurter:

So you don’t believe.

Daniel M. Friedman:

No, and I —

Felix Frankfurter:

Does the record show that?

Daniel M. Friedman:

The — the record speaks in terms of tags and the legislative history speaks in terms of losing tag.

I think there’s a sound practical reason why not, which is the average woman I don’t think would like to show her friend a fur coat and when the fur coat — friend opens it and sees the label, it says on it, “Contains used fur” or contains paws, bellies, and — paws, bellies and tails, I think as a practical matter, this is not the kind of information that the consumer would want to have made a permanent part.

Felix Frankfurter:

And you think if she gets that information on a piece of paper, she carefully puts it away.

Daniel M. Friedman:

I would hope she would.

Felix Frankfurter:

You would hope that.

Daniel M. Friedman:

Now — so we think basic —

Potter Stewart:

Well, isn’t the — isn’t the purpose of the Act to see to it that a consumer is fully and honestly informed of what she’s buying at the time she buys it.

Isn’t that its fundamental purpose?

Daniel M. Friedman:

Basically.

But I think there was also the purpose of — to make sure that the information which she receives is made available to her in such form that she has a permanent record, which will aid her in protecting her rights under this coats, for the fact —

William J. Brennan, Jr.:

I — I don’t get this “permanent,” why — what’s — why the emphasis on “permanent,” Mr. Friedman?

Daniel M. Friedman:

Well —

William J. Brennan, Jr.:

Is it a permanent in the sense you mean that it’s saved somehow by the purchaser?

Daniel M. Friedman:

Yes, the — the kind of thing that a consumer is — is likely to say.

William J. Brennan, Jr.:

Well, why — I gather — I don’t see why the — there’d be anymore disposition to save permanently an invoice than there would be to save a tag containing the same information.

Daniel M. Friedman:

Well, I think first that the — and I quote the almost ephemeral character of the tag.

It’s the sort of thing we traditionally, I think, tend to throw away.

William J. Brennan, Jr.:

Well, I — I have difficulty from personal experience understanding that there’s a preference for saving invoices.

That doesn’t seem to be so in my household.[Laughs]

Daniel M. Friedman:

Well, the — both the — the testimony before Congress was an — there’s an indication.

People have stated that the customer tends to throw away the tag and the invoice is something that she tends to keep.

William J. Brennan, Jr.:

Well, was the test — well, that there was testimony that’s something that she tends to keep?

Daniel M. Friedman:

Yes, Mr. Justice.

Daniel M. Friedman:

We have set that out at pages 19 and 25 —

William J. Brennan, Jr.:

Well, is this something peculiar to the purchase of furs?

Daniel M. Friedman:

Perhaps, and that it tends to be a major item of purchase and the information with respect to the furs, something the average housewife, I think, would be more likely to keep.

The — at least that seems to be the evidence was before Congress.

Hugo L. Black:

Did the Court of Appeals take judicial knowledge of why it did not keep those things?

Daniel M. Friedman:

No, Mr. Justice.

Felix Frankfurter:

Did it take judicial knowledge as they did?

Daniel M. Friedman:

No, they just took judicial knowledge of the — based to this definition of invoice.

They didn’t — they didn’t go into considerations of the purpose.

Hugo L. Black:

Your argument is that the evidence before Congress showed there was a difference?

And they did show that they wanted to and that the Court ought not to change, is that —

Daniel M. Friedman:

That is correct, Mr. Justice.

Felix Frankfurter:

What is the evidence, in any report or in the spokesman of the bill?

Daniel M. Friedman:

No, the evidence is in —

Felix Frankfurter:

Both by congressmen or witnesses in hearings.

Daniel M. Friedman:

Witnesses at hearings before the congressional committees.

William J. Brennan, Jr.:

And what were their qualifications?

Daniel M. Friedman:

They were representatives of the fur industry.

Felix Frankfurter:

And they wanted this statute to be — must be a noble industry.

I must say they wanted —

Daniel M. Friedman:

No, Mr. Justice — no, Mr. Justice, they certainly did not want this statute.

They opposed it.

But they suggested that if Congress felt that some protection was needed for the consumer, adequate protection would be given through the invoice in requirement, give the consumer the invoice.

Potter Stewart:

Now Mr. Friedman then, is it — am I correct in thinking that the material set out on — in your brief in which invoices are so highly allotted by representatives of the industry.

The fact is that they were proposing invoices instead of labels, isn’t that correct?

Daniel M. Friedman:

That is correct.

Potter Stewart:

They weren’t comparing invoices to labels.

They wished — they — they were opposing labels, isn’t that right?

Daniel M. Friedman:

They — they were — they were suggesting that an invoice was superior to —

Potter Stewart:

Was sufficient?

Daniel M. Friedman:

That’s right, but the statue as — that it came out of Congress, provided poor labeling and we think in the circumstances, it would have been anomalous that Congress gave them the greater protection, apparently, what they seem to think of the label and at the same time, denied in the protection of the invoice.

I made —

Felix Frankfurter:

And they will also have the price?

This is what you call the label.

Does that have the price of the fur?

Daniel M. Friedman:

Presumably, it’s not required.

Felix Frankfurter:

But — but at — as industry practice, doesn’t the label have the price?

Daniel M. Friedman:

Yes, but that would have to be on the other side of the label under the Commission’s rules, only certain information can be set forth on one side of the label, the required information.

Hugo L. Black:

May I ask what — what objection the Mandel offered to this?

What — what objection did he have to do in this, to that fur, did they say?

Daniel M. Friedman:

Well, their — their objection was — they said the Act is not applicable to the retail merchant.

Hugo L. Black:

They said it was not applicable to a retail merchant.

Daniel M. Friedman:

The false invoicing provisions.

Hugo L. Black:

Well, did the court below hold that?

Daniel M. Friedman:

The court below held that the false invoicing provisions are not applicable to retails —

Hugo L. Black:

To retail merchant?

Daniel M. Friedman:

To retail merchant, that’s correct.

Charles E. Whittaker:

Can that be sold upon (Inaudible)

Daniel M. Friedman:

That seems to be the opinion of the Court, it just looks — as we read the opinion, it just looked to the particular language.

I would now briefly like to turn to the —

Felix Frankfurter:

Before — may I ask one more question.

Am I right in understanding that this is not a case where the so-called invoice, when I say so-called, not in an invidious way, this technical invoice was stated things falsely, just didn’t state what was required by — under your views of the statute, is that right?

Daniel M. Friedman:

That is correct.

Felix Frankfurter:

This isn’t a case where an invoice misrepresented.

It didn’t make the representations, which according to your views are affirmatively required.

Daniel M. Friedman:

That is correct, but the — where the statute says that something —

Felix Frankfurter:

I — I understand that.

I just want —

Daniel M. Friedman:

That’s correct.

Felix Frankfurter:

In my mind, there might be a difference where a piece of paper is given which — which misrepresents, is underrepresented, is that it?

Daniel M. Friedman:

That it fails to represent.

Felix Frankfurter:

Failed to represent.

Daniel M. Friedman:

Briefly to turn to the second issue in the case, which is —

Felix Frankfurter:

Is there any — this is just an order so that we’re not bothered here where the mens rea is required.

Daniel M. Friedman:

No, this is a cease-and-desist — this statute requires without any mens rea certain obligations.

Hugo L. Black:

Did they put in the label to in evidence?

Did it come in evidence?

Daniel M. Friedman:

Yes, the labels are set forth at 64 (a) and 66 (b) of the record.

Hugo L. Black:

That — the labels I saw didn’t state much statement.

You — you mean that’s a sample of blank label.

Daniel M. Friedman:

That is a sample of the label and 66 (b) is another label stating that the country of origin of the fur and stating that it’s mink.

Our — our —

Hugo L. Black:

And that does contain all the information you say it should.

Daniel M. Friedman:

Perhaps.

I don’t know as to this particular label, but the complaint against them is they failed to state certain information such as the fur was dyed and properly, the state (Voice Overlap) —

Hugo L. Black:

Well, is that on their label?

Daniel M. Friedman:

That’s required both on the label.

Hugo L. Black:

Did they state all the information on the label?

Daniel M. Friedman:

No, they didn’t.

That — and that comes to the scope of the second part of the case.

The order against misbranding, the statute requires that to be — avoid being misbranded, the label must contain six categories of information specified.

The Commission in this case found that the label failed to include three categories of information and further found there was no evidence that the label failed to include the other categories of information.

The Commission entered an order directing them to cease-and-desist from misbranding by failing to include on their label, the six categories of information specifying these six categories.

The Court of Appeal struck from the order against mislabeling, the provisions covering the three categories of information with respect to which the Commission found there was no evidence or violation.

Now, at the outset, I may say that the principal complaint of Mandel against this phase of the order is its fear that the public will get the misapprehension that by virtue of having been told to cease-and-desist from this other violations that somehow violated them.

And in their brief at page 40, they have suggested — perhaps suggested that an alternative form of order, which will not specify the particular subcategories but will merely state to cease-and-desist from failing to include all the information required by the statute.

And in a brief — reply brief, we have stated that we construe that as having the same effect as the Commission’s order.

We therefore do not object to the form.

Earl Warren:

Mr. Friedman, there — there are two phrases or — or two words that are used in this case that bothered me a little, one of them is invoice and I’d like to know if there’s anything in the record to indicate that the term “invoice” is or is not used in the retail trade as it is in the wholesale trade.

Daniel M. Friedman:

The legislative history speak — speak —

Earl Warren:

You — you take it off from the legislative history.

Daniel M. Friedman:

Yes.

There’s nothing in the record —

Earl Warren:

Yes.

Daniel M. Friedman:

— in this case as such in which the word invoice is used in the retail trade other than the statutory definition of invoice.

Earl Warren:

Yes.

Daniel M. Friedman:

But the —

Earl Warren:

All right, go ahead.

Daniel M. Friedman:

The legislative history does show that they referred to the need for an invoice to a retail consumer, at least the fur representatives at that time were using the term “invoice” as applicable to retail sale, the retail sales slip.

Earl Warren:

Now, is there anything in the record that would indicate whether the term “commercial transaction” is used by Congress in connection with retail transactions as well as wholesale transactions?

Daniel M. Friedman:

Again, Mr. Chief Justice, nothing in the record.

But in the legislative history, there is repeated reference to the need to protect consumers among other things against — to set what we think deceptive invoice.

And then we therefore draw from the legislative history the inference that Congress used “commercial transaction” to include the sale by the commercial retailer to the individual customer.

Earl Warren:

Thank you.

Mr. Horne.

Samuel H. Horne:

Mr. Chief Justice, if the Court please.

To answer one or two of the questions at the outset, Mr. Justice Black asked what will Mandel do about invoicing.

Mandel gave invoices.

There are some two or three samples of them in the — in the record at page 65, 66 — 66 (a) the — the problem is whether the statute specifies what has to be on those invoices to the retail consumer, but it — it isn’t a matter of resisting, the giving of — of an invoice.

It’s a question of whether we are at that point subject to the act’s invoicing requirements.

Earl Warren:

You do consider this in the trade as an invoice, the — the document which appears at 66 (a).

Samuel H. Horne:

I’m not sure, Your Honor, that we do.

Earl Warren:

Well, you just said — you just said they did.

Samuel H. Horne:

Well, we’re using invoice here.

I suppose I as a term of art, we’re talking about a statute which requires invoicing.

Earl Warren:

Yes.

Samuel H. Horne:

Now, whether this is an invoice in the retail trade, there’s nothing in the record about that, one way or the other.

William J. Brennan, Jr.:

Well, just an ordinary sales slip.

Samuel H. Horne:

I beg your pardon?

William J. Brennan, Jr.:

It’s just the ordinary sales slip.

Samuel H. Horne:

That’s the way we — we view it.

It was in this FTC proceeding, treated as an invoice within the Act and the complaint there didn’t comply.

But —

Felix Frankfurter:

But is the real question whether, although it is an ordinary sales slip thing, you and I or — or I and my ignorance, my — my extreme of calling it an invoice, Congress is entitled to give invoice defined — limit beyond the colloquial meaning.

Samuel H. Horne:

Well, that’s right, it is.

Felix Frankfurter:

And the question is whether it has done so.

Samuel H. Horne:

That — that brings us down to the — to the heart of the question.

Felix Frankfurter:

Certainly.

Samuel H. Horne:

Whether in specifying the invoicing, Congress brought within its scope these invoices that are given at the — at the retail level.

Earl Warren:

Well, now — now may I — may I ask this.

Do you concede that the — that the term “invoice” is a — an appropriate term and is used in the retail business?

Samuel H. Horne:

If Your Honor please, in the early — early in briefing stages, as I recall, we raised the point and went on.

But an invoice in the common concept of the term isn’t the sort of thing that you get when you brought to the counter and buy something and get a sales slip.

That is used at different stages of a commercial process.

But in this prosecution, if you turn the — generally, we — we were faced with the contention that that sales slip is the invoice that Congress talked about and that it didn’t comply so we had to make the issue on that point.

I still adhere to my basic feeling that an invoice happens at a different stage in the commercial process.

Felix Frankfurter:

When you say you have to meet the issue, other than saying it isn’t an invoice in the terms of the statute.

What do you mean by that?

How did you — how do you meet it except in that way?

You mean allege you did — you don’t meet it by —

Samuel H. Horne:

Well, we —

Felix Frankfurter:

— to satisfy the requirement if this be an invoice, did it?

It did not satisfy the requirement.

If this be a statutory —

Samuel H. Horne:

That —

Felix Frankfurter:

— of why invoice, it didn’t satisfy —

Samuel H. Horne:

That came to be one of the questions in the case that —

Felix Frankfurter:

But you say you had to meet the issue —

Samuel H. Horne:

Whether —

Felix Frankfurter:

What?

Felix Frankfurter:

I don’t understand that.

Samuel H. Horne:

We had to face up to the issue, perhaps, I should have said.

Felix Frankfurter:

But what was — how do you face up to it except by saying —

Samuel H. Horne:

Where — well —

Felix Frankfurter:

— you’re not within the statute?

Samuel H. Horne:

First, we denied that it was an — an invoice within the statute.

Furthermore, we contended that such invoices as had been presented in the proceeding did comply.

Felix Frankfurter:

I see.

That’s (Voice Overlap) —

Samuel H. Horne:

And —

Felix Frankfurter:

That’s what I was searching for.

Samuel H. Horne:

It was found that some of them lacked, some of the required — some of the elements, some of the representations that would be required if it were a statutory invoice within the Act.

Felix Frankfurter:

Let me be clear about this.

There was — this is a piece of paper, it contains certain writings, certain information.

If you were to agree that you do not, that the statute required you for this transaction to comply with the statute, did it contain the information that the statute command be contained in such a piece of paper?

Samuel H. Horne:

Speaking of the sales slips that are in evidence here.

The finding was that some of them lacked one or more of the six required elements.

Felix Frankfurter:

Well now, if you — if you are required to include those elements, then the Commission has a right to issue this into this order, doesn’t it?

Samuel H. Horne:

That’s correct.

Felix Frankfurter:

And so I go back to my question.

Are you contending that even though this be considered an invoice within the terms of the statute, you comply with what was required?

Samuel H. Horne:

On the invoicing issue, I think that we are concluded by the finding below that —

Felix Frankfurter:

There were omissions — there were omissions.

Samuel H. Horne:

They were — there were omissions.

Potter Stewart:

But the Court of Appeals did agree with your fundamental and primary contention that these were not invoices within the meaning of the statute, is that (Voice Overlap)?

Samuel H. Horne:

Yes, Your Honor.

Potter Stewart:

And that’s the issue here on that — on that part of the case, isn’t that it?

Samuel H. Horne:

That is the — that is the first issue, whether those invoices, good or bad, or the in — or the invoices contemplated by the statute, in the private statute.

Hugo L. Black:

If that’s not an invoice, what would be invoice?

Samuel H. Horne:

What would be an invoice?

Samuel H. Horne:

I should say that the term “in common acceptance” is used when the manufacturer ships a batch of stuff to a wholesaler or to a retailer.

Hugo L. Black:

You mean the retailer cannot issue an invoice.

Samuel H. Horne:

Technically, he can, but I’m saying that in the common acceptance of the term and whether Congress —

Hugo L. Black:

I’m — I’m — what I’m — I might — you say that this fee were not invoice, isn’t what I ask you on — if these are not invoices, how could a retailer issue an invoice?

Samuel H. Horne:

I — I’d have difficulty in saying how a retailer could invoice, I —

Hugo L. Black:

Your — your position seems to me to be that the retailer can’t do it.

Suppose I’d go into sales rulebook and buy it for the argument.

They write them all down in one thing and that is to me not — is that an invoice?

Samuel H. Horne:

If we are wrong on this first issue here, it is.

But I’m — I still feel that in —

Hugo L. Black:

Well, that in your — in your judgment, would that be an invoice?

Samuel H. Horne:

In —

Hugo L. Black:

Hold on — hold on to invoice 12 different furs, put them all down just what they have here.

Samuel H. Horne:

Well —

Hugo L. Black:

In your judgment, would that be an invoice via retail?

Samuel H. Horne:

An invoice is usually defined as a list of goods sent together with prices perhaps from one person to another.

Well, that’s a — that’s a broad general term.

Hugo L. Black:

Whole — wholesales — wholesales over put down on here and I went in and bought 15 furs and put them all down, put down the price on each.

In your judgment, would that be an invoice within the meaning of this statute?

Samuel H. Horne:

Within the meaning of the statute to — no, Your Honor.

Hugo L. Black:

Well, if not, what could be an invoice?

Samuel H. Horne:

Well, an invoice within the meaning of the statute is one thing and an invoice —

Hugo L. Black:

What could be —

Samuel H. Horne:

— at large —

Hugo L. Black:

In your judgment, are you saying that a retailer cannot issue an invoice?

Samuel H. Horne:

I don’t —

Hugo L. Black:

Something he does would be an invoice.

Samuel H. Horne:

I don’t believe we can say that.

No, Your Honor.

Hugo L. Black:

Well, what would be then if this is —

Samuel H. Horne:

This technically —

Hugo L. Black:

I’m not talking about this.

Well, what would be an invoice?

Samuel H. Horne:

Technically, this may be an invoice at large.

Hugo L. Black:

In your judgment, (Voice Overlap) invoice, under the statute if this is one.

Samuel H. Horne:

Technically, this may be, speaking at large and apart from the statute, these sales slips may be invoices too.

But the question is whether —

Hugo L. Black:

Maybe.

If they’re not invoices, how could the retailer give an invoice?

Maybe they can, I’m not saying that — I just don’t know.

Samuel H. Horne:

Well, I — my difficulty is in getting away from the strong feeling that in — in the common acceptance of the term, an invoice is an earlier stage of the process.

Hugo L. Black:

Earlier stage, you mean —

Samuel H. Horne:

Prior to the retailers’ handling.

Hugo L. Black:

In other words, a retailer doesn’t issue invoice.

Samuel H. Horne:

Not in the common acceptance of the term, but I don’t believe, Your Honor, that with all respect that that’s going to — to get us anywhere because we’ve got a definition of invoice here.

And the question is whether what they did was within — or whether that step — step of the process is within the statutory definition of invoice.

Hugo L. Black:

You mean by saying step, when the retailer does?

Samuel H. Horne:

Does the — yes, sir.

Yes, Your Honor.

Hugo L. Black:

You are thinking of invoices given by manufactures or wholesales.

Samuel H. Horne:

I think that’s — that is certainly the common acceptance of the term and that is the way we view the requirements.

That’s correct.

Earl Warren:

Mr. Horne, let’s take this situation.

I notice in the — in the record that Mandel Brothers do a lot of other state business too.

That is people come to this store and — and have a good shipped out of the State.

Suppose they ship this — this fur that we’re talking about from — from Chicago to New York, and send it C.O.D. to the customer, and they issued some kind of a — of a document to indicate what the price was and what the article was and so forth, what would you call that?

Samuel H. Horne:

Perhaps we’d have to call that a non-statutory invoice, Your Honor.

Earl Warren:

[Laughter]

Hugo L. Black:

How do you use the word “invoice”?

Earl Warren:

[Laughs] No, we were labeling this from a — the carrier.

Samuel H. Horne:

Well, of course.

The — the obstacle in many of these considerations is the limited nature of the statutory definition.

Hugo L. Black:

Where — what part of the statute is that you think States takes out of retailer?

Samuel H. Horne:

Two parts, Your Honor, which is issued in connection with any commercial dealing —

Hugo L. Black:

In what ways to stop right then and do you consider this a commercial dealing?

Samuel H. Horne:

The sale from the — from Mandel to — to the customer?

Hugo L. Black:

Yes.

Samuel H. Horne:

It seems to me that dealing imports two people.

Hugo L. Black:

Well, there are two here.

Samuel H. Horne:

And dealing commercially imports trafficking in goods with a view to resale or exchange as a business.

And unless you have on both sides of your transaction, your retailer and your — your customer if the customer is buying to sell to someone else, that’s one thing but if — that is not the ordinary situation.

That imports, it seems to me, that first commercial clause, the necessity of their being of persons on each side of the transaction that are trafficking for gain, dealing commercially then now, the second clause —

Hugo L. Black:

I imagine both of these are, one of them is trying to get as cheap as it can, which is — I’m afraid my recent experience, they — they will not achieve and the other is trying to get as much profit as they can get.

Samuel H. Horne:

I suspect in this situation —

May I ask you (Inaudible)

Earl Warren:

If —

Samuel H. Horne:

Well, may I — continue to answer your question first, please?

The other clause in the definition and the — the one that’s been more talked about is purchaser, consignee and so on, or any other person who is engaged in dealing commercially in fur product or furs.

Now, that’s a big mouthful.

I think it might help get that picture if we say transported or delivered to a purchaser and so on, or any other commercially dealing person.

To shorten the — the — who is dealing?

That clearly, it seems to us, requires that the transferee in the process, the recipient of the statutory invoice, be a person who is dealing commercially, the Court of Appeals took both clauses, one as reinforcing the other.

But it seems to us that either clause would exclude from the purview of invoice as defined in the Act and that fall from the invoice in the requirements, the retail sale to the consumer.

Hugo L. Black:

Sometimes a consumer turns out to be a seller himself, wouldn’t it?

When installment, they come around.

Samuel H. Horne:

That sometimes is the case.

Hugo L. Black:

I can’t get — I couldn’t draw this line.

Samuel H. Horne:

Well, if you have — if you simply draw the line that — the invoicing requirements follow the product down to the hands of the retailer and from thereon, the protection is in the label, I think there’s more difficulty.

Hugo L. Black:

Which one do you think needs protection the most, a fur merchant or the individual that buys the fur from the fur merchant?

Samuel H. Horne:

Well, there was a great deal of talk in these congressional hearings suggesting that the consumer needs information, needs facts, needs to avoid the glamorized description of fur product that seems to have been pervading the fur industry.

Earl Warren:

Mr. Horne, If I — I apologize for asking so many questions, but I would like to ask you the same question I asked Mr. Friedman about the term “commercial transaction” or as you say, “commercially.”

I’d like to know if there’s anything in the record or in the cases that indicate that that term is limited to — to the wholesale trade or — or whether it’s applied equally to or at times to — to the retail trade.

Samuel H. Horne:

No, Mr. Chief Justice.

There isn’t a word in the reports or in the legislative history.

There is nothing in the record in this case.

There is one sidelight in which — which maybe at some interest to you in the legislative history and neither is this.

The — the term “dealing commercially” was used at another point, in an earlier stage of the — the bill to designate — it — they said in Section 3 (d) of H.R. 3734 as reported in the 80th Congress.

That a person dealing commercially, if he has reason to believe that the label has come to him as wrong, may substitute another label.

That’s the only other place in the history that I found dealing commercially is used.

Obviously there, it has to mean the wholesaler, the jobber, the retailer, because they’re the only ones that are interested in looking at the label and substituting or correcting it.

The consumer certainly is not interested in substituting —

Could I ask you a collective question?

Samuel H. Horne:

Certainly.

Under the Act now, construe this, you would have — you’ll have to furnish a label to the retailer, the same — the same information with the invoice as the Government says.

We should also appreciate that.

What practical difference does it make, well if you’ll have to furnish two pieces of label?

Samuel H. Horne:

From a practical standpoint and I’m speculating now, I must admit this isn’t in the record.

Was — it wasn’t raised.

From the practical standpoint, the fur buyer, the head of the department can, before they open the door, go down to the line of garments and police the tags, and make certain that all of the tags or labels of — are in proper order.

When the door is opened and the sale starts, and they have two or three dozen salesclerks to — selling the products, it becomes a different matter watching every say — it’s just — it’s physically impossible to watch every sales slip that each clerk makes out to make certain that it touches on each of the six statutory elements.

Well, that’s still what we have to label on, the label didn’t have what you’re reserving serving to a cease-and-desist order or —

Samuel H. Horne:

That’s right.

— proceeding — better understanding the cease-and-desist order, so I don’t see what the account of furnishing in the business with — (Inaudible) except that is a laborer copying out from the label.

Samuel H. Horne:

Well, there, it’s more than the physical effort of copying.

It’s a matter of checking to make certain that each clerk has copied correctly and that isn’t always feasible.

Tom C. Clark:

But it wasn’t a proper case (Inaudible)

You keep copies —

Samuel H. Horne:

We are —

Tom C. Clark:

You keep copies of your labels?

Samuel H. Horne:

Not of the labels, Your Honor.

Samuel H. Horne:

I don’t believe they do.

Tom C. Clark:

Why wouldn’t the invoice set the mere protection to you as well as to the public?

You’d have a copy of the invoice, a fellow allowed to label, you wouldn’t have a copy of anything.

He could say, “Well, the saleslady is telling me it was a tissue and it turns out to be red.

She was playing, and you would say, “Oh no, this is not the coat,” or something like that?

Well, if you had an invoice, which — which described on a letter, your got in your invoice copy and you’d say, “Well, here’s the invoice copy.

This shows what we gave you.

Here’s your signature on it.”

Looks like it protects you.

Samuel H. Horne:

Well, it might.

But on the other hand — well, I would suggest that that gets into an area in which the Federal Trade Commission has no function.

That’s the local controversy in the Federal Trade Commission.

The — the Fur Products Labeling Act is a disclosure act, and the Federal Trade Commission polices the disclosure, the completeness of the disclosure all through process.

But if —

Tom C. Clark:

Well, I grant you a —

Samuel H. Horne:

If a controversy arises at — at the local level as in a merchant and his customer, it’s going to be answered by the store’s practices.

Charles E. Whittaker:

I grant you, the Trade Act is aimed to the protection of the public and not protection to your bookkeeping, but you were trying to answer Justice Harlan as why you objected to this than a mere physical labor because of your clerks and I was just wondering why you and me in favor of it is going to go into the merits of it.

Samuel H. Horne:

Well, if Your Honor please, we are objecting at this point because if there’s a cease-and-desist order on us, we are exposed to future contempt or penalty proceedings if somebody makes another mistake.

And the lesser of that exposure we have, the happier the store will be.

That isn’t to say that there hasn’t been — there — I’m told that there has been a radical revision of all their procedures, I mentioned we made at the advertising.

That’s all been changed.

That’s in the cease-and-desist order, and their other procedures have been radically changed to try to bring them in the line, but there are limits to how far you can go with personnel and how much you can get out off them.

Now, you — someone asked me a question a moment ago whether we’d be prosecuted for typographical error.

One of the elements on — on the invoice in which we were found deficient is that the sales slip says Mandel Brothers and doesn’t say — the state of Madison to Chicago, Illinois.

The store had been there for more than 50 years and —

Tom C. Clark:

Can you give the address?

Samuel H. Horne:

And — we can give the address.

An attempt was made but the Commission didn’t go along with it, speaking of technicalities.

Tom C. Clark:

Well, that’s (Voice Overlap) —

Samuel H. Horne:

The labels —

Tom C. Clark:

Doesn’t that indicate that they wouldn’t go along with just their clerical errors.

They would say, “Well, Mr. Mandel, you didn’t have this as a practice.

This was not your instructions to your clerk, to leave this out.

The clerk just (Inaudible) she’s in a big hurry and you get the customer out of the store and I’m thinking now then failed to do it.

She made an error.

She failed to put down a petition.

They wouldn’t enjoin a little — a thing — purely clerical error, would they?

I mean, they were the basic case on that.

Samuel H. Horne:

Well, again, all I can say is they did.

That was while the deficiencies pointed out.

I know the deficiencies —

Tom C. Clark:

But at least they are instructions of the Mandel Brothers to their clerks rather than a clerical error of the clerk.

Samuel H. Horne:

No, they say of — as a printed form, Your Honor.

Tom C. Clark:

I know, but the filling in part, the part that you fill in.

Samuel H. Horne:

Well, certainly, but we can instruct all day long and hope that the clerk will grasp it and we’ll fill in all the required elements.

Tom C. Clark:

Did you instruct them to give paying all six?

Samuel H. Horne:

That isn’t in the record.

I assume that they have.

Earl Warren:

Well, isn’t it your — isn’t it your position that you didn’t instruct them to do anything so far as this invoice is concerned because you didn’t believe you’re obliged to under the law.

Samuel H. Horne:

Oh no, Mr. Chief Justice.

Here’s what happened.

The investigator from the Federal Trade Commission came in, in September of 1952, one month after the Act became effective to look over what they were doing.

Mandel Brothers was there as it had been, previously, giving these sales slips, such as are set forth in the record here.

There are fifteen or twenty of those things in — in the record below.

The investigator went through the books and took samples of the sales slips, which they had been given — giving and checked them to see if they were in conformity with the requirements of that new act.

He looked at the labels on the fur garments, checked them to see if they were in conformity with the new requirements.

He found some mistakes.

Earl Warren:

You say that was within two months of the — of the Act going onto effect in 1952?

Samuel H. Horne:

The Act gone into effect in — in August of 1952 and if I remember correctly, the investigator was there in September of 1952.

He came back in October of 1954 —

Earl Warren:

1954.

Samuel H. Horne:

— for another inspection.

Earl Warren:

Yes.

Samuel H. Horne:

And for whatever its worth, he found a great many fewer errors at the 1954 inspection.

And furthermore, for whatever it’s worth, he — it’s in the record.

He says nothing — there was no communication after the first inspection as to what — whether they were doing anything wrong or what they were doing wrong.

Earl Warren:

Well, I’m afraid Mr. Horne, I — I totally misconceived what’s your position is.

I thought your position in this case was that you are not obliged to have any — any of this material on the invoice or sales tags or whatever we choose to call it.

And that you therefore — therefore, you could not be ordered to cease-and-desist because the statute didn’t require you to put it on.

Samuel H. Horne:

Our position is that irrespective of whether these sales slips were within or without the — whether they did or did not have all six elements.

Earl Warren:

Yes.

Samuel H. Horne:

That that isn’t — the question here — the question — our position is that whether they did or didn’t, it was gratuitous so far as the Act is concerned, the giving of this.

It has nothing to do with the Act.

The Act doesn’t say that the retailer has to give the invoice.

The Act requires invoicing of furs from the raw pelt down to manufacturer.

The Act requires the labeling of fur products from the time they are manufactured until they reach the end to the consumer.

In addition, there is this further requirement, which is the issue before us.

It says “invoice fur product.”

Now, the extent of that requirement, of invoicing fur product, whether or not these invoices we gave were good or bad.

The extent of that requirement of invoicing fur products is — is the question here and that depends on what the definition means.

Earl Warren:

Well —

Samuel H. Horne:

If he doesn’t —

Earl Warren:

— what is your position that — is it your position that the law does or does not require the retailer to give an invoice, which will include this information?

Samuel H. Horne:

Our position is that the law does not extend to requiring a statutorily detailed invoice from the retailer to the consumer.

Earl Warren:

Well, now, does it require any kind of an invoice?

Samuel H. Horne:

No — no, Your Honor.

It will require — the only requirement of an invoice is the statutorily detailed invoice.

There’s no other involved.

Earl Warren:

All right.

Samuel H. Horne:

In the statute.

Earl Warren:

And — and you claim that’s not applicable to you because you’re a retailer?

Samuel H. Horne:

That’s right.

Earl Warren:

Then why —

Samuel H. Horne:

Well —

Earl Warren:

Why do you say that you’re — you’re conforming to it and it was only some slight deviations that they found in your invoices.

Is that essential to the case if you don’t have to — have to comply with the — the invoice portion at all?

Samuel H. Horne:

If we don’t have to comply, no, Your Honor.

But we had to file both steps in the case.

Earl Warren:

All right, but then —

Samuel H. Horne:

Well, we have only the one step here.

Earl Warren:

All right.

Then if you do have to comply, then the only question we have to determine is whether all of those things are included on your invoice, isn’t that right?

Samuel H. Horne:

That’s true, and I think that in — in the present posture of the case, we can’t deny that there was a finding and — unreversed finding that some of them were not included —

Earl Warren:

Yes.

Samuel H. Horne:

— if they are subject to the statutory requirement of invoices.

Earl Warren:

Yes.

Samuel H. Horne:

But our position is that your retailer to the consumer transaction has its complete and adequate protection in the requirement of a label.

The label has the same information, the Commission itself in its opinion twice, said, the clerk can copy from the — from the label on the invoice.

And as — as a further point, said that the — the information required for the invoice is the same that’s required for the label.

There’s no — there’s no doubt about it.

It’s a duplication.

Felix Frankfurter:

Yes.

Samuel H. Horne:

And — and —

Earl Warren:

Yes.

In —

Samuel H. Horne:

— we — our position is that the label is the thing that reaches the consumer and it has to be on the garment, on — when she examines it or if she considers it and it has to stay on the garment until it’s delivered into her hands.

But your invoice, what good does it do?

It doesn’t — except to — for local bookkeeping reasons.

It’s prepared after your sale has been consummated.

She doesn’t see that until after she — she takes the fur —

Earl Warren:

Yes.

Samuel H. Horne:

— coat home and unpacks it.

And as to the suggesting that they may lose or throw away the tag, I think it imputes absurdity federal legislation to say that it requires giving a consumer the same information on each of two pieces of paper, of course you’d like to lose one.

What — what has the Commission been doing administrating, or in perspective (Inaudible) they have been requiring (Inaudible)

Samuel H. Horne:

The Commission is —

Or it’s not your interest.

Samuel H. Horne:

I do know.

They have been after practically every fur dealer in the country, on and — on the whole thing.

We — we can’t decide the basic.

That they think the position that’s —

Construe it that way themselves.

Samuel H. Horne:

Yes.

Yes, Your Honor.

But we — we don’t feel that it — this is the first case in which that issue has been litigated.

We don’t feel that’s a long embedded practice.

Moreover, the thing was before Congress through three sessions.

The Commission wrote six letters of comment to the congressional committees describing the bill.

And in every case, the Commission said “Just two requirement.”

So the bill required invoice first and label fur product.

They never mentioned this other — in any of the letters.

So that that fur — that interpretation apparently was established after the Act got into the hands of Commission for administration.

There’s just one other feature of the legislative history I would like to touch on briefly.

Earl Warren:

Mr. Horne, your time is about up, but we have taken so much of your time asking — asking questions.

I think you’re entitled with few minutes of — uninterrupted argument and I’m going to give you five minutes extra to —

Samuel H. Horne:

Thank you, Mr. Chief Justice.

Earl Warren:

State what you want to say.

Samuel H. Horne:

I am glad to have to have the question because it indicates —

Earl Warren:

Well, I (Voice Overlap) — if you would like to sum up your argument and put it in perspective way.

Samuel H. Horne:

Well, for one thing on the — the invoicing question, it depends altogether on the interpretation of this term “invoice”.

I — short — I used a shorthand reference to it a moment ago or — or other commercially dealing person, purchaser, consignee, factor, bailee or other commercially dealing person.

Samuel H. Horne:

And I would like to point out just briefly the parallel between the language, that language and the language that the Court had before it in United States versus Standard Brewery, that’s cited in our brief.

The statute prohibited use of food products in the manufacture or production of beer, wine, or other intoxicating liquor.

And the Court held that — or other intoxicating liquor referred back and modified beer and wine and it had to be intoxicating beer before it was in that prohibition.

Similarly, we say that this clause, commercially dealing person, goes back and modifies that — enumeration of the persons who are concerned with the handling of furs.

Now, you’ll want to know, I think, why we say that it’s reasonable that Congress should have required the invoicing of fur products from the manufacturer to the retailer and not require it from the retailer to the — to the consumer.

The reason for that, it seems to us, is found in the fact that you’re intervening persons, your wholesaler, your jobber or your retailer.

Each one is responsible for seeing that the garment has a proper label on it before it goes forward from him.

If the wholesaler, the jobber, the retailer has a statutory invoice, a statutorily detailed invoice, he has something against which he can check the correctness of the invoice, of the label for which he is responsible.

But the consumer doesn’t have any responsibility to pass — pass it on to anybody.

And the consumer had — does have the full protection of the required statutory label.

There was a mention of the testimony in the hearings in the 80th Congress, where this whole legislation originated, the fur dealers and processors and manufacturers were about the only witnesses that were in there, except to — to irrelevant groups that were barred.

They were opposing the legislation.

They were opposing any legislation.

They were opposing labeling.

When they advocated invoicing to be observed, they didn’t advocate invoicing but we touched them.

They advocated invoicing by somebody else.

The — at the outset of those hearings, I have been testimony by a representative from the Federal Trade Commission who had recommended labeling as the remedy for the bills of the business.

At the close of those hearings and how it’s in the 80th, the sponsor of the bill, Congressman O’Hara, called as if — he’s the representative, if I could stand and ask if he could add anything to testimony.

He reaffirmed his previous advocacy of labeling then he turned to the suggestion of invoicing as being — as against labeling.

And he said, “Labeling would be a more effective remedy than invoicing because the label gives the customer facts before the — before she makes her choice.

The invoice comes after.”

Then he said it would be like locking the barn door after the horse is stolen.

He also went on the comment, “There is no burden on the manufacturer’s invoice, but there is a burden on the retailer to give an invoice at the time to every sale.”

Potter Stewart:

Mr. Horne, on the second aspect of this case, are you and the Government now on agreement as to the form of the order?

Samuel H. Horne:

Well, what they suggest would be an improvement on what the Commission did, but it would still leave us in the position where we’re subject to a cease-and-desist order, and if we do violate, it will be a penalty the first time and not the second time until your cease-and-desist order put you — says that you will —

Potter Stewart:

You’d be violating one of the three respects in which you have — have been talking.

Samuel H. Horne:

If we — if one of the three respects in which we — we were exonerated.

I thank you.

Earl Warren:

Very well.