It is not claimed that the Administrative Procedure Act is the last word on the subject. Like most legislative measures it represents a compromise between conflicting viewpoints. For those who subscribe to the attitude that specialized administrative agencies with quasi-judicial powers are a necessity in modern economic life, the Administrative Procedure Act Provides reasonable safeguards against the dangers about which Mr. O'Hara inveighs. As Arthur T. Vanderbilt recently stated, the act "marks the beginning of a new era in administrative law." Until that epochal statute has had a fair chance to demonstrate its effectiveness or lack of effectiveness, as the case may be, it is foolhardy to ask Congress to traverse the same ground by a lateral attack upon the act through the piecemeal process of amending the Federal Trade Commission Act along the lines proposed in H. R. 3871.

Let it not be forgotten also that the Administrative Procedure Act was the result of the composite efforts of the practicing attorneys who worked hrough committees of the American Bar Asociation, the Attorney General's Committee on Administrative Procedure, the thoroughgoing consideration of the Committee on the Judiciary of both the Senate and the House, and various other sources of assistance extending over a period of years antedating the particular bills which were finally enacted into law. It is not likely that the House Committee on Interstate and Foreign Commerce, noted for its careful and deliberate consideration of basic Federal regulatory legislation, will be drawn into an untimely proposal for amendment of the Federal Trade Commission which has served as a pattern for similar Federal quasi-judicial tribunals.

It is also worth noting that H. R. 3871 can hardly be appropriately considered without coordinating the jurisdiction of the House Committee on Interstate and Foreign Commerce with the jurisdiction of the House Committee on the Judiciary which is directly concerned with the question of transferring to the Federal district courts the increased burdens of the original jurisdiction contemplated by the O'Hara bill.

The tinkering character of the O'Hara bill as applied to the Federal Trade Commission's jurisdiction is further revealed by the fact that it is addressed only to amendments of certain sections of the Federal Trade Commission Act, particularly section 5 thereof, which declares unlawful "unfair methods of competition in commerce and unfair or deceptive acts or practices in commerce." If fears with respect to the combination of prosecuting and adjudicating functions apply to the Commission's adjudicatory powers on questions of fact under the Federal Trade Commission Act, why is H. R. 3871 so unconcerned about similar powers of the Commission in proceedings under the Clayton Act, as amended by the Robinson-Patman Act, the Export Trade Act, and the Wool Products Labeling Act? Surely "a day in court" is no less important for respondents under the last-stated acts than under the Federal Trade Commission Act. Is tender regard for the constitutional rights of citizens to be confined to one favored group of respondents? And if the Federal Trade Commission, as stated by Mr. O'Hara, is "primarily a regulatory agency" which should not adjudicate "issues of fact between the Government and the citizen as a judicial tribunal," what should be done about other Federal regulatory agencies with similar powers?

Surely it would tax credulity to impute to the Federal Trade Commission a monopoly of various deficiencies described by Mr. O'Hara in his statement supporting his bill. According to his version, the combination of prosecuting and adjudicatory functions "imposes on the Commission a responsibility that taxes the capacity of human nature. Experience has demonstrated that in the administration of its act the human frailty of the Commission has predominated." How easily that can be said of any tribunal made up of human beings!

In other parts of his statement the Congressman makes similar observations regarding other features common to the major Federal regulatory agencies. He is disturbed by the fact that the Commission "designates one of its trial examiners to preside over the hearings and appoints one of its trial attorneys to represent it in the proceeding." He complains about that face that "proceedings are often protracted and expensive," and that the Commissioners do not see or hear a single witness; that they do not read the whole record of testimony and depend upon the report of the trial examiner, briefs of counsel, oral argument, and advice of legal assistants. Finally, he decries the ineffective judicial review of the Commission's findings of fact because of the mandate that the findings of fact shall be conclusive if supported by evidence, which has been held to mean "substantial" evidence rather than a "preponderance" of the evidence.

All of the foregoing criticisms confirm the major point made in the first part of this statement that the O'Hara bill stems from the attitude that only a traditional court of law can accord a person protection of his fundamental rights in an original trial on both the facts and law of a controversy between the Government and the citizen. For it is clear that if the O'Hara bill is sound, then all of the objections registered against the Federal Trade Commission are paralleled in other Federal quasi-judicial tribunals.

H. R. 3871 is a denial of the validity of the principle that an expert regulatory commission can be trusted with determinations of fact. It assumes that impartiality is possible only in courts of law. It looks upon "administrative justice" as something as alien to our present legal system as was once thought to be true of courts of equity in the days of Coke. It fosters the delusion that there is an easy road back to the day when any adjudicatory tribunal other than a court of law was regarded as an illegitimate foundling on the doorstep of the common law.

The Administrative Procedure Act of 1946, despite its imperfections and compromises of conflicting viewpoints, is itself the answer of the legal profession generally to the fear that the constitutional rights of citizens will be vitiated by a trial of issues of fact before an administrative agency. With his characteristic judicial calm and insight into the lessons of history, Mr. Chief Justice Stone envisaged the attitude of the contemporary American legal profession toward administrative tribunals in these words:

"Rarely in the history of the law has such an opportunity come to our profession to carry forward a creative work which would enable the law to satisfy the pressing needs of a changing order without the loss of essential values. The ultimate establishment of equity, after a period of resistance, as a coordinate branch of the law, ameliorating the rigors of the common-law system and translating in some measure moral into juristic obligations, is a comparable transition in the law. The profession of our day, like its predecessors who saw in the pretensions of the chancellor but a new danger to the common law, has given little evidence that it sees in this new method of administrative control any opportunity except for resistance to a strange and therefore unwelcome innovation" ((1936) 50 Harvard Law Review at p. 17).

The Chief Justice manifested prophetic vision of the stage in which administrative law entered in 1946 when emphasis in the Administrative Procedure Act was placed upon administrative procedural reform rather than upon substituting traditional court proceedings for proceedings before an administrative body.

"Fortunately, the theories, firmly established in this country, of due process and of the supremacy of law over official action, afford that protection of individual right and justice which is the ideal of the common law. The time has come for a more ready recognition that the procedures worked out by administrative bodies have realized this ideal largely without the coercive intervention of courts, and that they have set up standards for the appraisal of the specialized experience with which they are concerned which courts could have formulated, if at all, only more tardily and with far greater difficulty. It is a record which

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encourages us to believe that our concern for the future should be not so much to secure for the citizen the adequate protection which, under the Constitution, cannot be denied, as to secure a more unified system of administrative procedure and to make certain that court review, whether by constitutional or statutory requirement, shall not go beyond that need, and shall be made available at such time and in such manner as will not unnecessarily impair the efficiency of the administrative agency, or duplicate its work by courts."

It would require a volume to elaborate upon the objections to H. R. 3871. Moreover, the task would be unrewarding since, as already pointed out, every one of the objections and every point in its support as set forth in Congressman O'Hara's statement, has been thoroughly explored in the controversial literature of the subject, particularly during the last 15 years. No attempt is made in this statement to review this controversy. Rather, I shall confine myself to certain specific aspects of H. R. 3871, which are based upon a fallacious approach to the problem of reconciling the need for conserving the public interest in administrative tribunals and the protection of public rights in courts of law.

House Resolution 3871 proposes to transfer from the Federal Trade Commission to the district courts of the United States the power to decide in the first instance whether section 5 of the Federal Trade Commission Act has been violated. The Commission would be left only with the function of filing a complaint in the dis

trict court and acting in the role of prosecutor. Upon the district court would fall the burden of deciding questions of fact and law pursuant to the rules of civil procedure for the United States district courts. Thus the Commission would merely initiate the proceeding and assist in its prosecution just in the case of the Antitrust Division of the Department of Justice. The investigatory functions of the Commission woud be ancillary to its prosecuting authority. If the district court decides that the method of competition or the act or practice violates the act, it will enter a permanent injunction order, subject to review in the circuit courts of appeals and on certiorari ultimately in the Supreme Court. This deprival of the Commission's power to adjudicate factual issues reverts to the discredited idea that a Federal Trade Commission proceeding should be treated like a traditional adversary lawsuit. This is indeed a rejection of the theory, to which the courts themselves have subscribed, that the traditional courts are not adapted to the handling of factual questions related to the carrying out of a congressional policy regarding unfair trade practices and restraints of trade. The courts are accustomed to appraise the merits of a particular controversy on a wide variety of types of cases. They do not have the specialized knowledge and skill arising from continuous attention to the specific types of issues upon which an administrative agency constantly focuses its attention. Consequently a court is apt to view the specific case before it without benefit of a perspective of the whole congressional policy such as the administrative tribunal gains from specialization in the field of its delegated authority.

House Resolution 3871 also does violence to the assumption that courts of law would be able to undertake the enormous burden of fact finding in unfair competition and restraint of trade cases without serious deflection from their present extensive duties. It requires little imagination to perceive that the courts are now so heavily burdened with their conventional types of cases that H. R. 3871 would only serve to increase the presently overcrowded dockets of the district courts. I think it is safe to say that the judges of the district courts will show little enthusiasm for this threat of foisting upon them the arduous task of fact finding contemplated by the O'Hara bill.

Even the Logan bill of 1936, which proposed the establishment of a Federal administrative court with both a trial and appellate division, did not depart from the concept that it was essential to have a specialized tribunal with a consolidation of the quasi-judicial functions of the separate administrative bodies. There have also been proposals for a specialized commerce court and during the OPA period, the emergency court of appeals sat as an expert tribunal on cases arising under the Emergency Price Control Act. H. R. 3871, however, represents a complete abandonment of such an approach by giving to a single judge without any specialized background the responsibility of resolving complicated issues of fact.

The Supreme Court has recently shown that it appreciates the desirability of relieving the courts of the fact-finding burden in trade practice cases. In Bruce's Juices, Inc., v. American Can Co. (330 U. S. 743 at p. 746), the majority of the Court said:

66* * * The economic effects on competition of [quantity] discounts are for the Trade Commission to judge. Until the Commission has determined the question, courts are not given guidance as to what the public interest does require concerning the harm or benefit of these quantity discounts on the ultimate public interests sought to be protected in the act.

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In similar tenor the minority opinion observed that:

* * * It may be granted that the Federal Trade Commission has more technical knowledge and experience in dealing with the complexities of this problem than most courts; and the Commission's judgment would be of inestimable value to any judge called upon to deal with quantity discounts. *

The relevance of these quotations is heightened by the fact that under the O'Hara bill, the courts would be called upon to resolve issues of fact on the highly intricate questions of violation of the Sherman Act as well as of the Federal Trade Commission Act. This is true because under section 5 of the latter act, the courts have sustained the Commission's jurisdiction over combinations or conspiracies in restraint of trade in violation of the Sherman Act. The Commission has instituted many proceedings involving price-fixing conspiracies and combinations boycotts under section 5 of its organic act. All of these complex factual issues would be thrown into the hopper of the district courts by the mere filing of a complaint by the Commission.

It is no answer to say that H. R. 3871 preserves the Commission's investigatory powers. Under the proposed bill, the district courts would not have the benefit

of the Commission's adjudication of the facts. The specialized experience of the Commission would not be brought to bear on the vital fact-finding function. The district courts would be compelled to assume the role of fact-finding experts in a field, which is primarily a problem of national regulatory policy, where courts of law are not adequately equipped by experience gained in the handling of the traditional adversary judicial proceedings in private controversies.

There is another significant reason why an administrative tribunal like the Federal Trade Commission is better adapted than a court of law for the adjudication of questions of fact. As far back as 1908, Charles Evans Hughes, who was then campaigning for Governor of New York, had this to say about a proposal to vest in an appellate court the trial of questions of fact:

"And I tell you, ladies and gentlemen, no more insidious assault could be made upon the independence and esteem of the judiciary than to burden it with these questions of administration-questions which lie close to the public interest, and in regard to which the people are going to insist on having administration by officers directly accountable to them."

This objection applies with equal force to the O'Hara bill's proposal of giving the district courts the burden of trial of issues of fact.

In a true sense the Federal Trade Commission is much more responsive than any court can be to the will of the people expressed through Congress. In Humphrey's Executor v. U. S. (295 U. S. 602 (1935)), Mr. Justice Sutherland stressed this responsiveness of the Commission as an agency created by the Congress, saying:

"The debates in both Houses demonstrate that the prevailing view was that the Commission was not to be 'subject to anybody in the Government but * :* * only to the people of the United States'; free from 'political domination or control' or the 'probability or possibility of such a thing'; to be 'separate and apart from any existing department of the Government-not subject to the orders of the President.'"

In its most recent opinion involving the Federal Trade Commission, handed down on April 26, 1948, in Federal Trade Commission v. The Cement Institute (16 Law Week 4359), the Supreme Court again recognized the valuable assistance of the Federal Trade Commission as a specialized tribunal. The Cement Institute opinion reaffirms prior judicial interpretations that the term "unfair methods of competition" embraces any conduct within the scope of the Sherman Act. In so doing, the Court again emphasized the manner in which the Federal Trade Commission implements the judicial process by having the Commission act as an expert aid to the courts. Mr. Justice Black said:

"But on the whole the act's legislative history shows a strong congressional purpose not only to continue enforcement of the Sherman Act by the Department of Justice and the Federal district courts but also to supplement that enforcement through the administrative process of the new Trade Commission. Far from being regarded as a rival of the Justice Department and the district courts in dissolving combinations in restraint of trade, the new Commission was envisioned as an aid to them and was specifically authorized to assist them in the drafting of appropriate decrees in antitrust litigation. All of the committee reports and the statements of those in charge of the Trade Commission Act reveal an abiding purpose to vest both the Commission and the courts with adequate powers to hit at every trade practice, then existing or thereafter contrived, which restrained competition or might lead to such restraint if not stopped in its incipient stages."

The Court also pointed out that the same conduct of the defendants might subject them to simultaneous suits instituted by the Department of Justice and by the Federal Trade Commission. The Court said:

"Just as the Sherman Act itself permits the Attorney General to bring simultaneous civil and criminal suits against a defendant based on the same misconduct, so the Sherman Act and the Trade Commission Act provide the Government with cumulative remedies against activity detrimental to competition. Both the legislative history of the Trade Commission Act and its specific language indicate a congressional purpose, not to confine each of these proceedings within narrow, mutually exclusive limits, but rather to permit the simultaneous use of both types of proceedings."

In other parts of the Cement Institute opinion, the Court took occasion to reassert its belief in the correctness of the congressional purpose of avoiding the overburdening of the courts with involved questions of fact finding by bringing to the aid of the courts the expertness of a quasi-judicial body such as the Federal Trade Commission. The Court said:

"We are persuaded that the Commission's long and close examination of the questions it here decided has provided it with precisely the experience that fits it for performance of its statutory duty. The kind of specialized knowledge Congress wanted its agency to have was an expertness that would fit it to stop at the threshold every unfair trade practice that kind of practice, which if left alone, 'destroys competition and establishes monopoly.'

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If the district courts are vested with jurisdiction to find facts in unfair-competition and restraint-of-trade cases, another serious obstacle to effective enforcement of the congressional policy embodied in the Federal Trade Commission Act would arise. Under the present act, the Commission is in a position to develop a consistent and uniform national policy, through its adjudicationof-fact issues and expedited judicial review of its orders in the circuit courts of appeals and in the Supreme Court. If the district courts are given power to decide fact questions, the process of developing a unified body of law on this subject could be greatly impeded. Each district court would approach its task of fact-finding without the aid of an over-all view of the policy involved such as the Commission derives from its specialized activities. Even though the courts alone have the power to decide questions of law, namely, whether the method or acts of respondents constitutes a violation of law, H. R. 3871 increases the probability that there will be greater diversity in the decisions of the district courts than exists under the present method of judicial reviews of the Commission's orders in the circuit courts of appeals. By having original jurisdiction to pass on both questions of fact and law, there is great risk that within a short time what may be deemed unfair competition, for example, in one district will not be deemed unfair competition in another district. In the absence of an administrative adjudication by the Commission on the facts and the conclusions of law reached by the Commission, it is reasonable to suppose that the decisions of the district courts will lack consistency and uniformity on a much larger scale than the present possibility of differences of views of the circuit courts of appeals on questions of law only. Moreover, the ultimate decision of the Supreme Court on issues arising under the O'Hara bill would be delayed much longer than is now the case.

It is no flight of fancy to suggest that under H. R. 3871 there may result a checkerboard of heterogeneous unfair competition decisions of district courts which will take considerable time and expense to bring into uniformity through the appellate processes.

Another disadvantage which would result from depriving the Commission of its quasi-judicial power to adjudicate facts would be the great loss in time and expense now avoided under the informal settlement of cases by stipulation agreements. It should be kept in mind that the great majority of Commission cases are settled without issuance of a formal complaint by extending to persons the privilege of executing a stipulation satisfactory to the Commission in which the person, after admitting the material facts, promises to cease and desist from and not resume the practices in question. Under H. R. 3871, all such stipulations involving factual issues will require approval by the district courts in conformity with the Rules of Civil Procedure governing the proceedings in those courts.

Even after issuance of a formal complaint, all agreements of respondents to cease and desist on stipulated facts and a so-called consent order would have to be approved by the district court and entered formally as an order of the court. This means that even though the Commission may preliminarily confer with prospective respondents prior to the filing of a complaint in the district court, it would not be in a position to engage in any adjudication in connection with stipulations and consent orders but would have to resort to the district courts for any binding action on matters concerning which stipulations are sought.

Under its existing act, the Federal Trade Commission has recently placed greater emphasis upon elimination of unfair trade practices through cooperative means upon an industry-wide basis by promulgation of trade practice conference rules for an industry. The O'Hara bill would throw into question the use of trade practice conferences under the guidance of the Commission, since the Commission's authority for holding such conferences is implied from the present wording of section 5 of the act which the O'Hara bill amends in such terms as to make it doubtful whether this authority will still continue. Moreover, in its trade practice conference work, the Commission makes use of its stipulation procedure and this, too, would have to be changed to conform to the necessity of securing approval for such stipulations in the district courts.

In short, it is doubtful whether, in the absence of adjudicatory powers, the Commission's investigatory and prosecutory powers under H. R. 3871 will enable