Alberty v. Federal Trade Commission

182 F.2d 36, 86 U.S. App. D.C. 238, 1950 U.S. App. LEXIS 4321, 1950 Trade Cas. (CCH) 62,583
CourtCourt of Appeals for the D.C. Circuit
DecidedMarch 20, 1950
Docket9843_1
StatusPublished
Cited by21 cases

This text of 182 F.2d 36 (Alberty v. Federal Trade Commission) is published on Counsel Stack Legal Research, covering Court of Appeals for the D.C. Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Alberty v. Federal Trade Commission, 182 F.2d 36, 86 U.S. App. D.C. 238, 1950 U.S. App. LEXIS 4321, 1950 Trade Cas. (CCH) 62,583 (D.C. Cir. 1950).

Opinions

PRETTYMAN, Circuit Judge.

This is a petition to review an order of the Federal Trade Commission. Petitioners are engaged in selling food and drug products. They were charged by the Commission with disseminating false advertisements amounting to unfair and deceptive acts or practices in commerce. Four products are involved in this petition. They are Oxorin Tablets, Zen, Vitamin A Shark Liver Oil, and Alberty’s Phospho B. After hearing, the Commission made detailed findings and issued a cease and desist order. Petitioners contest the validity of two clauses contained in parts of the order.

The Commission found that typical of the advertisements in respect to Oxorin are; bition left, when every effort you make seems to leave you weak and spent then try Oxorin Tablets, a tonic for the blood.”

“Pep up your blood! Iron * * * A principal factor in Red Blood Cells * * * The disease Fighting Units of the Blood.”
“When you are weary, tired, run-down, just dragging yourself around with no am-

The Commission found as a fact that these tablets have no beneficial effect upon the blood except in cases of simple iron-deficiency anemia and that there are many causes of run-down conditions and lack of energy which will not be beneficially affected by the tablets. Petitioners do not object to that portion of the cease and desist order which forbids them to represent “That the preparation ‘Oxorin Tablets’ will have any therapeutic effect upon the blood or the red corpuscles thereof, except in cases of simple iron deficiency anemia; or that said preparation will relieve, correct, or have any beneficial effect upon the condition of lassitude characterized by such expressions as ‘weariness’, ‘tiredness’, ‘weakness’, ‘lack of energy’, or ‘general run down condition’, unless such representation be expressly limited to symptoms or conditions due to simple iron deficiency anemia”.

However, the Commission added to the foregoing the requirement that the advertisement also state “that the condition of lassitude is caused less frequently by simple iron deficiency anemia than by other causes and that in such cases this preparation will not be effective in relieving or correcting it.” This additional clause is one of the two which are the subject matter of the petition for review. It is applied to other products as well as to Oxorin Tablets.

The Federal Trade Commission Act gives the Commission authority to prevent persons from using unfair or deceptive practices in commerce,1provides that the dissemination of false advertisement is an unfair or deceptive practice in commerce,2 and defines a false advertisement as one which is misleading in a material respect.3 [38]*38In determining, whether the advertisement is misleading, failure to reveal facts made material by existing representations and failure to reveal facts made material by reason of the consequences of using the product are to be considered.4 Thus, false advertising, by the terms of the statute, includes failure to reveal certain characteristics of the product which become important either because of certain things which are represented in the advertisement or because of consequences which arise from the use of the product. The Supreme Court has held that the act confers upon the Commission not only the powers specifically prescribed but all power falling within the penumbra of meaning in the statutory provisions. In Jacob Siegel Co. v. Federal Trade Comm.,5 the Supreme Court held that in these cases “the courts will hot interfere except where the remedy selected has no reasonable relation to the unlawful practices found to exist.”

. The question posed in the case at bar is not restricted to the peculiarities of these products. None involved is injurious or harmful in any sense. On the contrary, it is agreed that they have beneficial effects. The proposition that. an advertisement should limit claims of beneficial effect to the causes for which the product is helpful—-in the case of Oxorin Tablets simple iron-deficiency anemia—is not disputed. But the Commission says that these advertisers must go further 'and say that the condition of lassitude is caused less frequently by simple iron-deficiency anemia than by other causes and that in such cases the product will not be effective. In short, the Commission. requires that the advertiser tell the public that his product is more frequently valueless than it is valuable.

[2] If this rule applies to petitioners, it must also apply to all other products similarly advertised. The scope of the power thus claimed by the Commission will be seen if the advertisements which are currently customary in newspapers and magazines and on the radio are called to mind. Headaches, lack of energy, indigestion, and numerous other ailments may be due to any one or more of many causes, and remedies for these ills are usually beneficial only when the condition results from certain of those causes. It is admitted in this case that the Commission can require an advertiser of a product beneficial to a certain condition to specify which cause of that condition will yield to the product. But under the power claimed, the Commission could require every such advertiser to announce that in most cases the remedy will be useless. The question before us deals with an advertiser who states plainly that his product will aid a certain condition when that condition arises from one certain described cause. The question is whether that advertisement is, nevertheless, false and fraudulent unless it also' states that frequently, or less frequently, or more frequently, the described condition springs from other causes which will not be reached by the product.

Even if we give effect to the broadest possible concept of the power conferred by the Congress upon the Commission, we do not think that the Commission has the power here claimed. There is a limit to the Commission’s power. It is not given a general charter to police the expenditure [39]*39of the public’s money or generally to do whatever is considered by it to be good and beneficial. The task assigned it by Congress is specific, and it has no other authority in respect to this subject. False advertising is defined by the act 'as including failure to reveal facts made important, or of some consequence, because of other things claimed, and failure to reveal facts made important, or of some consequence, because of the results of the use of the product. The Commission must find either of two things before it can require the affirmative clause complained of: (1) that failure to make such statement is misleading because of the consequences from the use of the product, or (2) that failure to make such statement is misleading because of the things claimed in the advertisement. There is no such finding here.

Nor do we see how a derogatory addendum to the advertisement, such as that required here by the Commission, has any reasonable relation to the purpose of preventing the 'advertisements from being misleading. As we have pointed out, there are no harmful consequences from use of these products. The limitations imposed by the first part of the Commission’s order reveal the stark, complete truth. In the case of Oxorin Tablets, petitioners can say that they help lassitude only if they specify lassitude due to simple iron-deficiency anemia. The Commission has found that such a statement is true. Moreover, it is the full truth. It is clear enough that an additional derogatory negative emphasizes the truth.

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Alberty v. Federal Trade Commission
182 F.2d 36 (D.C. Circuit, 1950)

Cite This Page — Counsel Stack

Bluebook (online)
182 F.2d 36, 86 U.S. App. D.C. 238, 1950 U.S. App. LEXIS 4321, 1950 Trade Cas. (CCH) 62,583, Counsel Stack Legal Research, https://law.counselstack.com/opinion/alberty-v-federal-trade-commission-cadc-1950.