LEWIS R. MORGAN, Circuit Judge:
This is an appeal from an order of the District Court for the Northern District of Georgia directing the appellant Genuine Parts Company to comply with an Order to File a Special Report issued by the Federal Trade Commission (hereafter, the Commission or the F.T.C.) pursuant to a resolution of the Commission, dated December 18, 1967, authorizing a non-public investigation of Genuine Parts under Section 6 of the Federal Trade Commission Act, 15 U.S.C. § 46 (1963) (hereafter, the Act),
to determine whether there was reason to believe Genuine Parts had violated the antitrust laws in making certain acquisitions and corporate mergers. The district court’s opinion is reported at 313 F. Supp. 855. The district court later amended its order and stayed the accrual of the penalties imposed for failure to respond to a special report order within thirty days after notice of default, under Section 10 of the Act, 15 U.S.C. § 50 (1963),
“pending final outcome of any appeal which may be taken from this order” and staying the judgment pending appeal insofar as it represents a judgment for enforcement of the Commission’s order. The Commission cross-appeals from this portion of the order.
Genuine Parts is the largest warehouse distributor of automotive parts in the country, with annual sales in 1967 in excess of $204,000,000. It operates 35 warehouse distributor outlets in 22 states. A warehouse distributor such as Genuine Parts purchases automotive parts from manufacturers and then resells them to jobbers. Jobbers in turn stock a smaller inventory of parts and resell them to repair garages and service stations for use in maintenance or repair work for the ultimate consumer. Genuine Parts also operated 185 jobber stores or outlets scattered among the states in which its warehouses were located and rebuilt a limited number of types of automotive parts at three other locations.
The order to file a special report here in question was issued by the F.T.C. on December 28, 1967, in conjunction with an investigation of the automotive parts industry and was served on Genuine Parts on January 2, 1968. Genuine Parts was required to file its answer with the Commission within 90 days aft
er the date of issuance. The order contains about sixty questions divided into eight specifications, nuínbered I to VIII.
These specifications are further broken down into lettered questions. On March 27, 1968, Genuine Parts filed a report with the F.T.C. in which it responded to nineteen of the sixty questions, offered to respond to two other questions if they would be received
in camera
and treated as confidential. Genuine Parts offered no response
to the remaining thirty-nine questions, notwithstanding the preface of the F.T.C. order, which provided:
« * * * if any question cannot be answered fully, give such information as is available to you, and explain why your answer is incomplete and the source from which a more complete answer may be obtained. If books and records which provide accurate answers are unavailable, enter your best estimates, indicating the sources or bases of your estimates. * * * ”
Instead of giving any explanation for its failure to respond to these questions, it stated in its report:
Genuine Parts Company respectfully refuses to respond to certain items of the Order on grounds, among others, that response to these items would be unduly burdensome; that the information sought by such items is irrelevant; and that the Order, insofar as it contains said items to which no response is made, is beyond the Commission’s authority.
There were no specific objections in the report to any of the thirty-nine unanswered questions. At a conference with Commission representative on April 2, 1968, counsel for Genuine Parts informed the officials present that Genuine Parts would provide responses to the unanswered questions of the order only when ordered to do so by court order.
On July 26, 1968, about four months after the partial response to the special report order had been filed with the F.T. C., and Genuine Parts still not having replied to any of the unanswered questions, the Commission served upon it a notice of default, informing Genuine Parts that it was in default in failing to provide much of the information required by the December 28, 1967, order, and that if its failure continued it would become subject to a penalty of $100 for each day after the thirtieth day of the notice of default.
The notice specified each of the unanswered questions and then noted that Genuine Parts’ answers to some of the other questions might be deficient in specified respects.
On August 14, 1968, Genuine Parts brought this action for declaratory and injunctive relief. By its complaint, Genuine Parts alleged that the Commission’s order to file a special report constituted a denial of due process by requiring responses that were oppressive, unreasonably burdensome, irrelevant and beyond the scope and purpose of the investigation the Commission had undertaken, and sought a declaration that it need not comply with provisions of the Order and that any action the Commission might take to impose the statutory penalty of Section 10 would be illegal. Genuine Parts also sought what it termed a preliminary injunction to prevent the accrual of the penalty pending the resolution of the matter.
On August 21, 1968, a hearing was held before the district court on the preliminary injunction, and, although neither the court nor the F.T.C. had been apprised of Genuine Parts’ specific objections to the unanswered questions, the court entered an order “that no
statutory penalties shall accrue under the provisions of Section 10 of the * * Act pending further order of this Court”. Specific objections to the unanswered questions were first filed with the F.T.C. and the court on September 18, 1968. Upon suggestion of the district court, negotiations were entered into between the F.T.C. and counsel for Genuine Parts. These negotiations, however, proved fruitless and the F.T.C. filed a counterclaim seeking enforcement of its order of November 13, 1968.
The matter was set for hearing before the district court on January 6,1969. At the hearing, however, Genuine Parts stated its intention to amend its complaint and file a motion for discovery. Genuine Parts was given until March 3rd to file its motion for discovery. The stated reason for the motion for discovery was to determine whether the F.T.C.’s actions toward Genuine Parts had shifted from the “investigative to the adjudicative stage”. Genuine Parts based its belief that the mode of the proceeding before the Commission had shifted on an article in the October, 1968 issue of
Motor Age,
a trade magazine, which reported an interview with Mr. Paul Teetor, the F.T.C. counsel in charge of the Genuine Parts investigation, and stated that “cases * * * have been prepared” against four firms, including Genuine Parts, and that these firms were “caught in the Commission’s web”. In response to this motion, the F.T.C. filed three affidavits, one from Mr. Teetor and the two others from members of the F.T.C. staff involved in the Genuine Parts investigation, stating that the F.T.C. had not made a decision to issue a complaint against Genuine Parts and that no complaint had been prepared or drafted by any member of the F.T.C. staff.
On May 8, 1968, the district court denied the motion of Genuine Parts for discovery, stating that it saw “no way in which the depositions requested by [Genuine Parts] could be relevant to the constitutionality of the ‘Order to File Special Report’ which is the subject. matter of the complaint”, and that the time for such discovery would be after the Commission filed a complaint in an adjudicative proceeding. Genuine Parts filed a motion to amend this order or for the allowance of an interlocutory appeal under 28 U.S.C. § 1292(b). The F.T.C. opposed the motion to amend and filed a motion for summary judgment. The motion to amend was denied on August 7, 1969, and on November 4, 1969, a hearing was held on the merits of the order to file a special report.
On May 21, 1970, the district court entered a final order on the issues raised by the complaint. In summary, the final order held that Genuine Parts did not have to comply with the order to the extent that the underlying records necessary to respond to some of the questions were no longer in existence; defined certain disputed words and phrases used in the order; and ordered the remaining unanswered questions to be answered, either precisely as they had been presented by the F.T.C. or on the terms stated in the order.
On June 1, 1970, Genuine Parts filed a motion to alter or amend the May 21st order so as to delay the answers to certain questions until the F.T.C. had received other responses and demonstrated a need for the additional responses to the satisfaction of the district court; to enjoin the accrual of statutory penalties pending the exhaustion of appellate relief; and, insofar as the order constituted a judgment on the F.T.C. counterclaim for enforcement, that such judgment be stayed pending resolution of all appellate proceedings and subsequent district court proceedings.
On August 3, 1970, the district court denied the motion to alter or amend, but ordered that no penalties would accrue pending final outcome on appeal and stayed its judgment insofar as the order represents a judgment for enforcement of the Commission’s order pending appeal. Genuine Parts subsequently filed notice of appeal and a cross-appeal was filed by the Commission.
The appellant Genuine Parts makes two main contentions: First, it contends that the district court erred in denying its motion to discover from the Commission whether the proceedings against it had shifted from the investigative to the adjudicative stage, so as to entitle it to the procedural safeguards provided for by the Commission’s rules in adjudicative proceedings, notwithstanding the fact that no complaint had been filed against it by the F.T.C. Secondly, it contends that the district court erred in ordering it to respond to the question set out in Specifications V and VII, Sections (F), (G), (H), and (I), of the Commission’s order on the ground that the questions are unreasonably burdensome, not reasonably relevant to the investigation and outside of the scope of the Commission’s authority. The Commission, in its cross-appeal, contends that the district court erred in enjoining the accrual of penalties under Section 10 of the Act.
I.
Discovery
Genuine Parts takes the position in this appeal that when an F.T.C. investigation is no longer a general inquiry, but has begun to focus, and the Commission is in the process of gathering evidence to be used in an agency process for the formulation of an order in an adjudicative proceeding, prior to the formal initiation of that proceeding through the issuance and service of a complaint, the adjudicative process
substantively
commences and from that point forward the requirements of due process demand that further investigation be conducted pursuant to the procedural rules established by the Commission for adjudicative hearings. Cf. Escobedo v. Illinois, 378 U.S. 478, 84 S.Ct. 1758, 12 L.Ed.2d 977 (1964). On this basis, Genuine Parts seeks the right to discover from the Commission facts which would enable the district court to find that the adjudicative process had, in substance, begun, and order the Commission to conduct any subsequent investigation according to the discovery rules applicable to adjudicative proceedings.
We find this novel attempt to en-graft the principle of
Escobedo
into the field of administrative law without merit.
Although it is quite possible to view investigative proceedings and adjudicative proceedings as merely constituent parts of the administrative enforcement process, they have long been recognized as separate and distinct proceedings serving different functions and entitling parties to different rights under the due process clause of the Fifth Amendment. In Hannah v. Larche, 363 U.S. 420, 80 S.Ct. 1502, 4 L.Ed.2d 1307 (1960), the Supreme Court held that the procedures used by the Civil Rights Commission, a purely investigative body, did not violate due proces. In so doing the Court observed:
A typical agency is the Federal Trade Commission. Its rules draw a clear distinction between adjudicative proceedings and investigative proceedings. 16 C.F.R., 1958 Supp., § 1.34. Although the latter are frequently initiated by complaints from undisclosed informants, id., §§ 1.11, 1.15, and although the Commission may use the information obtained during investigations to initiate adjudicative proceedings, i d., § 1.42, nevertheless, persons summoned to appear before investigative proceedings are entitled only to a general notice of “the purpose and scope of such investigation,” id., § 1.33, and while they may have the advice of counsel, “counsel may not, as a matter of right, otherwise participate in the investigation.” Id., § 1.40. The reason for these rules is obvious. The Federal Trade Commission could not conduct an efficient investigation if persons being investigated were permitted to convert the investigation into a trial. We have found no authorities suggesting that
the rules governing Federal Trade Commission investigations violate the Constitution, and this is understandable since any person investigated by the Federal Trade Commission will be accorded all the traditional judicial safeguards at a subsequent adjudicative proceeding, * * * Id., 446, 80 S.Ct., 1517.
See also, F. T. C. v. Cinderella Career and Finishing Schools, Inc., 1968, 131 U. S.App.D.C. 331, 404 F.2d 1308. A further indication of the distinction recognized between investigative and adjudicative proceedings is the fact that “both industrywide investigations and adjudicative proceedings involving the same general subject matter may be instituted and conducted simultaneously” and “that the exercise of such dual functions by an administrative agency does not constitute a deprivation of due process”. Lehigh Portland Cement Company v. F. T. C., E.D.Va., 1968, 291 F.Supp. 628, aff’d. per curiam 4 Cir., 1969, 416 F.2d 971(1).
The purpose of an investigative proceeding conducted by an administrative agency “is to discover and produce evidence not to prove a pending charge or complaint, but upon which to make one if, in the [agency’s] judgment, the facts thus discovered should justify doing so”. Oklahoma Press Publishing Co. v. Walling, 327 U.S. 186, 201, 66 S.Ct. 494, 501, 90 L.Ed. 614 (1946). Thus, granting that to be effective an administrative investigation must focus on specific parties and particularized matters “to get information from those who best can give it and who are most interested in not doing so,” United States v. Morton Salt Co., 338 U.S. 632, 70 S.Ct. 357, 94 L.Ed. 401 (1950); such an investigation serves a function which is directly related to, but at the same time distinct from, the function of an adjudication. An investigation discovers and produces evidence; an adjudication tests such evidence upon a record in an adversary proceeding before an independent hearing examiner to determine whether it sustains whatever charges are based upon it. A party under investigation may not contest the discovery and production of evidence in the same manner he may contest the use of that evidence in an adjudication by proper objection, by the introduction of other evidence, and the other safeguards traditional to an adversary proceeding under our system. An investigation does not determine guilt or innocence; that is done at the adjudication, and thus it is there the whole plethora of due process rights designed to insure the fairness of such a determination come to bear.
Aside from this, there are grave policy considerations that militate against allowing the process of administrative investigation to become adversary in nature, even after it becomes specific and particularized. These considerations were succinctly stated by the Supreme Court in Hannah v. Larche, supra, 363 U.S. at 443-444, 80 S.Ct. at 1515, where it stated:
* * * [T]he investigative process could be completely disrupted if investigative hearings were transformed into trial-like proceedings * * *. Fact-finding agencies * * * would be plagued by the injection of collateral issues that would make the investigation interminable. * * * This type of proceedings would make a shambles of the investigation and stifle the agency in its gathering of facts.
We therefore hold that there is no shift from the investigative to the adjudicative stage until a complaint is issued and served by the Commission on the party charged, 16 C.F.R. § 3.11(a) (1971), and until that point is reached the procedural safeguards required by due process in an adjudicative proceeding are unavailable.
II.
Objections to Order to File Special Report
Genuine Parts contends that two Specifications of the Special Report Order were not sufficiently limited by the district court in its order of May 21, 1970. Of these, Specification V seeks informa
tion concerning the relationship between Genuine Parts and what the Order terms dependent jobbers; and Specification VII, of which Genuine Parts objects only to §§ (F) through (I), deals with Genuine Parts’ relationship with its suppliers.
The district court clarified several of the questions contained in these
specifications and limited the response required by others.
Genuine Parts argues that Specification V is too broad in scope and that any attempt to respond would be unreasonably burdensome because it would be required to report all of the detailed information called for on each jobber customer falling within any of the categories stated in the Specification’s definitions of “dependent jobber”. Genuine Parts makes similar objection to the controverted sections of Specifications VII on the grounds that it would be required to report each instance of financial or other assistance given to it or its jobber customers by suppliers named in response to the specification. It also objects to the descriptions used in Specification VII, such as “sales promotional or other kinds of services”, and “advertising allowances”.
The chief limitation on an investigation by an administrative agency is that it must meet the test of reasonableness. Oklahoma Press Publishing Co. v. Walling, supra, 327 U.S. at 208, 66 S.Ct. 494.
In United States v. Morton Salt Company, supra, the Supreme Court set out the standard by which Section 6 investigations conducted by the F.T.C. are to be judged:
* * * [I]t 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 * * *. Id. at 652, 70 S.Ct. at 369.
At the same time the Court recognized the extreme breadth that must be accorded the Commission in conducting such an investigation.
* * * 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. Id. at • 652, 70 S.Ct. at 369.
While an investigation under Section 6 may be objected to on the ground of oppressiveness and as requiring an unreasonably burdensome compliance, United States v. Associated Merchandising Corporation, S.D.N.Y., 1966, 261 F.Supp. 553, see F. T. C. v. Hunt Foods and Industries, Inc., S.D.Calif., 1959, 178 F.Supp. 448, aff’d. 9 Cir., 1961, 286 F.2d 803, cert. den. 365 U.S. 877, 81 S.Ct. 1027, 6 L.Ed.2d 190, we do not think such an objection can be sustained in this case. It is clear that the demand contained in the F.T.C. Order here in question is within the authority of the Commission, is not too indefinite, and is reasonably relevant to the purpose of the investigation. Indeed, the portions of the Order here objected to go to the very heart of the inquiry — the relationship between Genuine Parts and its jobbers on the one hand and its suppliers on the other. When the degree of burdensomeness necessarily inherent in the preparation of a full response to the Order
is considered in light of the pertinent responses the objected portions of the Order will produce, we are unable to hold that the burden of compliance is unreasonable. We therefore hold that Genuine Parts must comply with the controverted portions of the Order, as limited by the district court, as well as those portions remaining unanswered which where not objected to in this appeal.
III.
Stay of Statutory Penalty
In contending that the district court erred in granting Genuine Parts a stay of the accrual of the penalty imposed by Section 10 of the Act upon failure to comply with an order to file a special report thirty days after issuance of a notice of default, the Commission advances two arguments: first, that the stay is void because Genuine Parts failed to exhaust its administrative remedies, relying on St. Regis Paper Co. v. United States, 368 U.S. 208, 82 S.Ct. 289, 7 L.Ed.2d 240, reh. den. 368 U.S. 972, 82
S.Ct. 437, 7 L.Ed.2d 401 (1961), and United States v. Morton Salt Company, supra; and, second, that Genuine Parts failed to make any of the showings required to obtain an injunction of an administrative sanction, relying on Virginia Petroleum Job. Ass’n. v. Federal Power Com’n., 1958, 104 U.S.App.D.C. 106, 259 F. 2d 921, 925. Genuine Parts counters by contending that under
St. Regis Paper
persons served with an order to file a special report by the F.T.C. have the right to challenge that order in federal court after the notice of default has been served but before penalties begin to accrue under Section 10, and that such persons are entitled to a stay of the accrual of penalties during the pend-ency of such challenge.
It is clear from both United States v. Morton Salt Company, supra, and St. Regis Paper Co. v. United States, supra, that the Supreme Court has sanctioned, at least in
dicta,
the manner being used here to review an order to file a special report, and that a person under such an order has the right to seek review by way of an action for a declaratory judgment after the Commission serves it with a notice of default, but before the statutory penalty for failure to comply begins to accrue and without the necessity of awaiting action by the Commission seeking judicial enforcement of the order by way of injunction.
See Continental Baking Company v. Dixon, D.Del., 1968, 283 F.Supp. 285. But see Federal Trade Commission v. Claire
Furnace Co., 274 U.S. 160, 47 S.Ct. 553, 71 L.Ed. 978 (1927), and Anheuser-Busch, Incorporated v. F. T. C., E.D.Mo., 1965, 242 F.Supp. 122, which hold that a person under an order to file a special report cannot seek judicial review prior to the issuance of a notice of default, triggering the forfeiture provisions of Section 10.
These cases, however, leave in doubt the two issues we face here: whether the person seeking to contest the Commission’s order must exhaust his administrative remedies, if indeed any are or were available, and whether, and under what circumstances, such a person is entitled to a stay of the penalty pending review of the contested order.
A.
Exhaustion of Remedies.
It is not contested that at the time this suit was filed the Commission’s Rules of Practice and Procedure did not provide for any administrative procedure to contest the issuance or the terms of a special report order. Subsequently, and apparently in response to this litigation, the Commission amended its rules to provide that a person served with a special report order may file a motion with the Commission to limit or quash the order within 10 days after the special report order was served. 16 C.F.R. § 2.12(b), 15 U.S.C.A. (App.Supp.1971). Notwithstanding the absence of such a rule when this lawsuit was commenced, the Commission asserts that there was an informal procedure of which Genuine Parts ought to have been aware, which would have accorded it the same right of review now accorded by § 2.12(b) any time before the issuance of the notice of default, and that the failure to exhaust this remedy barred it from seeking judicial review of the order, much less a stay of the statutory penalty.
In
Morton Salt,
supra, the Court refused to consider objections to the terms of a special report order, saying:
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 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. 338 U.S. at 653-654, 70 S.Ct. at 369.
While this suggests the possibility of a procedure by which to make objections to the terms of an order before the Commission, it must be noted that the whole thrust of the controversy in
Morton Salt
was whether the Commission had authority to issue the order in the first place. No objection had been raised to the terms of the order until the ease was before the Supreme Court. In this light the above-quoted passage from the opinion is at best ambiguous and could refer to the lack of a district court record on the issue, as well as the lack of any prior administrative proceeding. Likewise, in
St. Regis Paper,
supra, the existence of
such a procedure is suggested by the fact that the party under investigation filed a motion to vacate several special report orders prior to seeking judicial review and the Commission temporarily suspended the order while the motion was under consideration.
However, there is nothing in the opinion to indicate that such a motion was a necessary precondition to judicial review or that such motions to vacate were part of a well-established informal procedure before the Commission, rather than merely a good faith effort to avoid litigation by informal means.
Section 3(a) of the Administrative Procedure Act, now codified at 5 U.S.C. § 552(a) (1967), provides that “ * * * [e]ach agency shall separately state and currently publish in the Federal Register for the guidance of the public — *< * (C) rules of procedure * * *” and that “[ejxcept to the extent that a person has actual and timely notice of the terms thereof, a person may not in any manner be required to resort to, or be adversely affected by, a matter required to be published in the Federal Register and not so published”. See United States v. Morton Salt Company, supra, 338 U.S. at 644, 70 S.Ct. 357. Even though the record before us indicates that Genuine Parts made every effort to avoid a timely presentation of its specific objections to the Commission, and in doing so in all probability unduly lengthened and complicated the present litigation, this Court is hesitant, on the authority here before us, to hold that Genuine Parts was barred from seeking judicial review as a result of its failure to exhaust an uncertain informal remedy, at the time unreported in the Federal Register. It must be noted, however, that in light of the Commission’s new Rule § 2.12(b) this decision cannot offer solace to others of like mind who wish to “by-pass” the Commission in the future.
B.
Availability of a Stay
In
St. Regis Paper,
supra, the Supreme Court indicated that a stay could have been sought at the commencement of the action in the district court (brought by the Commission to enforce its special report order and for the forfeiture of accrued penalties) and, although it refused to hold that the court of appeals abused its discretion in denying a stay upon appeal, the Court itself stayed the accumulation of further penalties when it granted the petition for writ of certiorari. See n. 11, supra. Thus, it is clear that a stay of the accrual of Section 10 penalties is at least available in the type of review proceedings contemplated by
St. Regis Paper.
What is not clear is under what circumstances a person challenging a special report order is entitled to a stay. In discussing the availability of a stay in
St. Regis Paper,
the Court said: “we are not prepared to say that courts would be powerless ‘to act where such
orders appear suspect
and ruinous penalties would be sustained pending a good faith test of their validity’ ” * * * “for a test of reasonable objections to such an order.” (Emphasis supplied). 368 U.S. at 226-227, 82 S.Ct. at 300. The implication is that a stay of the accrual of Section 10 penalties would be appropriate whenever the challenged order “appears suspect” and the review seeks a “good faith test” of “reasonable objections” to the order. Such a stay was issued in Continental Baking Company v. Dixon,
supra,
283 F.Supp. at 288, although the district court did not discuss the grounds upon which it granted the stay, except to cite
St. Regis Paper.
It is thus left to determine whether the district court abused its discretion in granting the stay under the standard set out above. See St. Regis Paper Co. v. United States, supra, 368 U.S. at 226, n. 13, 82 S.Ct. 289. The
Commission strongly argues that this action was brought in bad faith for the purpose of delaying any potential adjudication that might come about as a result of the information elicited by the special report order. Upon the record before us, such a contention is not without support. No real effort was made by Genuine Parts to obtain relief directly from the Commission to limit the questions contained in the order by informal discussion and some of the objections, particularly those concerning the definition of terms,
seem nothing less than picayune. However, the district court found it necessary to limit the order in certain respects in order to avoid any unreasonable burdensomeness, and for that reason alone, we are unable to say that it abused its discretion in granting the stay under what we understand to be the logic of
St. Regis Paper.
Now that the issues presented by Genuine Parts have finally, after inordinate delay, been decided, however, the stay must be dissolved upon the issuance of the mandate of this court.
The judgment of the district court is hereby in all things affirmed.
Affirmed.