Federal Trade Commission v. Orton

175 F. Supp. 77, 1959 U.S. Dist. LEXIS 2912, 1959 Trade Cas. (CCH) 69,404
CourtDistrict Court, S.D. New York
DecidedJuly 10, 1959
StatusPublished
Cited by3 cases

This text of 175 F. Supp. 77 (Federal Trade Commission v. Orton) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Federal Trade Commission v. Orton, 175 F. Supp. 77, 1959 U.S. Dist. LEXIS 2912, 1959 Trade Cas. (CCH) 69,404 (S.D.N.Y. 1959).

Opinion

DAWSON, District Judge.

This is a motion, pursuant to the provisions of § 9 of the Federal Trade Commission Act, 15 U.S.C.A. § 49, for an order requiring respondent to appear before the petitioner’s hearing examiner and produce certain documentary material referred to in a subpoena duces tecum served upon the respondent. The only issue relates to that portion of the subpoena duces tecum which would require respondent to produce

“All schedules submitted to the Bureau of the Census on Form MC 20C by all plants, manufacturing establishments or units owned or controlled by your concern in conjunction with the 1954 census of manufacturers together with copies of all correspondence clarifying or amending said schedules or reports.”

It is to be noted that the subpoena duces tecum does not require the respondent to submit any work papers or other material used by the respondent in compiling the information submitted to the Bureau of the Census, or file copies thereof, but requires production of the actual schedules submitted to the Bureau, together with all correspondence clarifying or amending said schedules or reports.

Respondent contends that this subpoena duces tecum calls for confidential and privileged data and it cannot be compelled to produce the documents required.

It is to be noted that Form MC 20C has at the top of it the following statement:

“Confidential — -This report should be returned within 30 days of its receipt. This report is required by Act of Congress (13 U.S.C. [§] 131). Your report is confidential and only sworn Census employees will have access to it. It cannot be used for purposes of taxation, investigation or regulation.”

The subpoena duces tecum has been issued in connection with a proceeding now pending before the Federal Trade Commission in which the Federal Trade Commission alleges that The Borden Company and other companies have violated the provisions of the Federal Trade Commission Act and § 7 of the Clayton Act, 15 U.S.C.A. § 18. This subpoena was issued in connection with this in *79 vestigation by the Federal Trade Commission by virtue of the regulatory authority of the Federal Trade Commission.

The Federal Trade Commission has broad powers to secure information or data from companies subject to its regulatory authority. See 15 U.S.C.A. § 49. It cannot, however, require that the respondent produce the schedules submitted by it for the 1954 Census of Manufactures.

The census was taken pursuant to the provisions of Title 13 U.S.C. § 131, providing for preparation by the Secretary of Commerce, in each fifth year, of a census of manufactures.

Section 9 of Title 13 U.S.C., provides that neither the Secretary of Commerce, nor any other officer or employee of the Department of Commerce or bureau or agency thereof, may use the information furnished under the provisions of this title for any purpose other than the statistical purposes for which it is supplied, or “make any publication whereby the data furnished by any particular establishment or individual under this title can be identified.”

Where information is given under such a statute, the information so furnished is privileged. See 8 Wigmore, Evidence, § 2377 (3d ed. 1940):

“The policy underlying the principle of § 2374 ante, is that where the Government needs information for the conduct of its functions, and the persons possessing the information need the encouragement of privacy in order to be induced freely to make full disclosure, the protection of a privilege should be accorded.
“In that well-settled common-law application of this policy, the privilege concerned information relating to the conduct of third persons. But many situations exist where the information can best be obtained only from the person himself whose affairs are desired to be known by the Government. An attempt to do so by mere compulsion might be tedious and ineffective. And where the ultimate purpose to be served is administrative, and not penal, it may well be that the Government can afford to promise secrecy in respect to purposes penal or litigious, as the price of readily achieving its administrative purpose when it demands a report of the truth.
******
“(3) The most-apt instance of this principle is the privilege, established in most jurisdictions, for reports of commercial and industrial facts, required by law to be made by employers of various sorts, or by commercial houses, or by public utilities, to the appropriate administrative official, as well as for reports of accidents in carriage by rail, by motor, or by aircraft. Here the main object is to investigate conditions and causes with a view to future administrative action; hence the State can afford to abdicate the use of such reports for purposes of punishment or of private litigation, in case the facts reported reveal a legal liability or a commercial secret on the part of the person reporting.” Vol. 8 Wig-more, Evidence § 2377 (3d ed. 1940).

One example of such reports cited by Wigmore is census data. Id. nn. 3 & 5.

That the information furnished to the Bureau of the Census in the Census of Manufactures was to be privileged and confidential was announced by the President of the United States on November 22, 1929, when he stated in a proclamation that

“The sole purpose of the census is to secure general statistical information regarding the population and resources of the country, and replies are required from individuals only to permit the compilation of such, general statistics. No person can be harmed in any way by furnishing the information required. The census has nothing to do with *80 taxation, with military or jury service, with the compulsion of school attendance, with the regulation of immigration or with the enforcement of any national, state or local law or ordinance. There need be no fear that any disclosure will be made regarding any individual person or his affairs * * See 36 Op. Attys. Gen. 366 (1930).

In the present situation the petitioner seeks to invoke the processes of this Court to compel respondent to reveal data filed with the Government which the Government at the time stated would be confidential and not used for regulatory purposes, and which the President of the United States had indicated, in a proclamation, would never be used in connection with “the enforcement of any national, state or local law or ordinance.” The information required by the Government in connection with the census had to be prepared in a particular manner and was not necessarily information which a business would furnish if it had an opportunity to check with its accounting records or its counsel. *

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Related

In Re FTC Corporate Patterns Report Litigation
432 F. Supp. 291 (District of Columbia, 1977)

Cite This Page — Counsel Stack

Bluebook (online)
175 F. Supp. 77, 1959 U.S. Dist. LEXIS 2912, 1959 Trade Cas. (CCH) 69,404, Counsel Stack Legal Research, https://law.counselstack.com/opinion/federal-trade-commission-v-orton-nysd-1959.