author: PER CURIAM: WILKEY, Circuit Judge

text:
    STANDARD EDUCATORS, INC. and James A. Melley, Sr., Petitioners v. FEDERAL TRADE COMMISSION, Respondent.
    No. 72-1164.
    United States Court of Appeals, District of Columbia Circuit.
    Argued Dec. 6, 1972.
    Decided March 9, 1973.
    Ronald J. Wilson, Washington, D. C., for petitioners.
    Nicholas S. Reynolds, Atty., Federal Trade Commission, with whom Harold D. Rhynedance, Jr., Asst. Gen. Counsel, Federal Trade Commission, was on the brief, for respondent.

      Before WRIGHT and WILKEY, Circuit Judges, and RICHEY, District Judge.

       Of the United States District Court for the District of Columbia, sitting by designation pursuant to 28 U.S.C. § 292(a) (1970).

   PER CURIAM:

This case is here on a petition to review an order of the Federal Trade Commission. The Commission directed its order against James A. Melley, Sr. in his individual capacity, as well as against the company, because it found that Melley knew of and approved many of the false and deceptive practices. Testimony before a hearing examiner showed that Melley was the organizer of the company, served as its president and treasurer, and owned 51 per cent of its stock. In the company’s infancy he did much of the selling himself, and although at the time in question Melley no longer engaged in any selling himself, he still, in the words of the trial examiner, “spends his time in the office supervising the over-all operations * * *.” In addition, he devised the form contract used by the company’s salesmen, a contract whose provisions were an integral part of the deceptive scheme. All of these factors, combined with the uncontradicted proof of widespread instances of deceptive practices by company salesmen, support the Commission’s finding that Melley knew of and approved the deceptive practices. See Fred Meyer, Inc. v. F.T.C., 9 Cir., 359 F.2d 351, 368 (1966).

The Commission introduced testimonial evidence as to 12 typical sales, dating from February 1965 to May 1968, taking place at sites as widespread as Oahu, Hawaii, Colorado Springs, Colorado, Groton, Connecticut, Portsmouth, New Hampshire, and Havre de Grace, Maryland. The same oral misrepresentations were made in every one of these cases, and in each the pattern of deception was facilitated by the contract written by Mr. Melley. The Commission does not engage in speculation when it rejects the conclusion that these similarities occurred purely by coincidence and instead infers that they were the result of direction from above.

In drawing inferences about the knowledge of corporate officers in cases such as this, the Commission properly draws upon its expertise. And where it does so, our guiding principle in reviewing the Commission’s findings of fact is Mr. Justice Black’s statement for a unanimous Court in F.T.C. v. Standard Education Society, 302 U.S. 112, 117, 58 S.Ct. 113, 116, 82 L.Ed. 141 (1937):

“The courts do not have a right to ignore the plain mandate of the statute which makes the findings of the Commission conclusive as to the facts if supported by testimony. The courts cannot pick and choose bits of evidence to make findings of fact contrary to the findings of the Commission. * * * ”

(Footnote omitted.)

In this case, the conclusion that Melley knew of and authorized the deceptive practices was amply supported by evidence of record. A heavy burden of exculpation rests on the chief executive and primary shareholder of a closely held corporation whose stock-in-trade is overreaching and deception.

The other issues raised by petitioners are without merit, and were dealt with at length in the Commission’s careful, well reasoned opinion. Accordingly, the order of the Commission is

Affirmed.

WILKEY, Circuit Judge

(dissenting):

The illegal practices alleged in this case were false and deceptive statements made by individual salesmen of Standard Educators, Inc., in connection with door-to-door sales of encyclopedias. I agree with the majority that substantial evidence supports the FTC’s findings that such statements were made. I agree that the corporation, acting through its salesmen, violated the Federal Trade Commission Act.

I cannot agree with the majority’s affirmance of the Commission’s decision to direct its cease and desist order against James A. Melley, Sr., in his individual capacity. The FTC and the majority repeatedly stress the existence of admitted violations by salesmen. That simply gets them nowhere on the issue of Mr. Melley’s personal involvement, although it does, of course, support the FTC’s decision against the corporation, with which I agree. As regards Mr. Melley, I find the Commission’s opinion neither “careful” nor “well reasoned.” To the contrary, it is unsupported and cavalier.

As the Commission itself notes in its opinion here, “[t]he rationale for subjecting respondents in their individual capacities to Commission orders is to assure that such orders will be fully effective in preventing the unlawful activities.” This rationale necessarily implies that some connection must be established between the individual respondent and the alleged unlawful practices. If a proven connection' were unnecessary, the Commission could conceivably proceed to order each and every U.S. citizen or resident to cease all imaginable illegal practices within the FTC jurisdiction. The very nature as a “cease and desist” order implies that the named individual was at least indirectly involved in the past, or is likely to participate in the future, in the activities which the Commission wants stopped. In short, naming individual respondents in a case like this “is tantamount to a finding on the evidence that they have personally violated, or can be expected to violate . . ." the relevant statute. Flotill Products, Inc. v. FPC.

Although the degree of personal involvement in the alleged violations which justifies individual direction of a cease and desist order has been variously articulated, mere ownership and control of an offending corporation, whose employees have committed the charged violations, is not enough. Mr. Melley was in fact the majority shareholder, President, Treasurer, and Chairman of the Board of Standard Educators. However, a more specific and substantial connection with the violations must be (but was not) shown to justify the order issued against him here. Rather than establishing such a connection, the FTC’s opinion, as it relates to Melley individually, ignores a highly experienced hearing examiner’s findings, goes far beyond proper inference, engages in cynical and unwarranted speculation, and finds no support in the record.

This is not a case in which a likelihood of future violations has been shown, for example, by evidence that the corporation involved was formed for the purpose of evading FTC orders. Compare FTC v. Standard Education Society et al. Hardly a “fly by night” operation, Standard Educators, Inc., enjoyed a stable corporate existence since its founding in 1957. There is absolutely no evidence in the record to support a finding that Mr. Melley would attempt to play the “shell game.”

This is not a case in which the deceptive practices were so intertwined with company policy that the responsible corporate officers could be fairly deemed to have known of and approved the violations. Compare FTC v. Standard Education Society et al. and Benrus Watch Company v. FTC. To the contrary, the Commission proved only scattered misrepresentations perpetrated by individual salesmen. The only evidence of central corporate policy came from Melley himself and was apparently credited by the hearing examiner. Mr. Melley testified that the company had a strong policy against misrepresentations and fired salesmen who were found to have engaged in deceptive practices.

This is not a case in which widespread knowledge of the offenses in the community justified an inference that the corporate officers closely involved must also know of and approve the violations. Compare Fred Meyer, Inc., et al. v. FTC. Mr. Melley did admit that he knew the company was receiving a “very minimum” number of customer complaints, “maybe one a month.” For a company doing over $2,000,000 in sales to individual customers (in 1969), that level of customer dissatisfaction was hardly high enough to support an inference of knowledge of pervasive deceptive practices. Since Melley went on to explain how he sought to discipline salesmen and satisfy the complaining customers, an inference of approval of these abuses is even more far-fetched.

Even assuming that the illegal practices could or should have been known to those directing the company on a day-to-day basis, .this is not a case in which personal knowledge could be fairly attributed to the individual officer actually named. Compare Coro, Inc. v. FTC. While Melley was deeply involved in the corporation’s early beginnings, he had almost completely withdrawn from routine supervision of its affairs at the time when the violations charged here occurred. The only evidence concerning his actual degree of involvement indicates that, while some important matters were occasionally brought to his attention, he didn’t “seem to have too many duties any more,” didn’t “watch sales that closely,” no longer hired or trained salesmen, and in fact was so removed from the business that he did not even really know how many salesmen were actually employed

This is not a case in which documents distributed by the company, and used by salesmen, were themselves found to be deceptive. Compare Consumer Sales Corp. v. FTC and Steelco Stainless Steel v. FTC. There is absolutely no finding, nor could there be a reasonable one, that the contract used was on its face in any way misleading. This last point is highly significant because, when stripped of merely eonclusory language, the Commission's opinion finding personal involvement appears to be based solely on the fact that Mr. Melley helped to draft the sales contract.

Although not finding the contract itself deceptive, the FTC and the majority here describe that document as “an integral part” of the deceptive sales practices challenged in the complaint. The Commission concludes that it is “unlikely” that the form used could have been “supplied for any other purpose” than that of enabling and authorizing salesmen to “sell encyclopedias in the deceptive manner charged.” No direct evidence supports such a view. Indeed, Melley testified that the operative reason for the selection of the actual contract format was a perhaps lazy, but otherwise blameless, decision to copy the clauses used by the competition.

The Commission’s findings rest on the inference that a deceptive use was intended to be made of concededly nondeceptive language. If it were the case that the language of the contract had no other reasonable and commercially proper use, such a gossamer inference just might withstand scrutiny. However, all of the contract clauses singled out by the Commission do have legitimate and nondeceptive functions.

The FTC suggests that the spaces provided for filling in military service information were designed to facilitate salesmen’s claims that, as a member of the military, the customer was getting a special price. Yet, at another place in the very same opinion, the Commission mentions the more obvious, legitimate, and I submit the actual, purpose for collecting this data: the customer location “problem . . . created by . [the] business policy of directing sales to military personnel.” Since that group is extremely mobile, detailed and accurate military service information was essential to keep track of people who had installment obligations to fulfill.

The FTC notes that the contract mentions a charge of $3.95 “for delivery” of an extension service and binder. Their contention is that this language was intended to buttress the salesmen’s fiendishly deceptive claim that the additional cost was merely for “postage and handling charges.” Given the fact that $3.95 was indeed the total price, I find it difficult to share the Commission’s grave concern about the misleading effect of this oral representation. Even if I did share that concern, I would still be persuaded that a contract drafted with intent to support the “postage and handling” characterization would use that precise language rather than the more ambiguous “for delivery” term.

The FTC further argues that this scheme of deception was writ large in the contract’s reference to the “National Combination Offer.” Whatever the salesmen may have said, falsely, about lower prices for larger purchases, the fact remains that this phrase refers to a perfectly legitimate method by which Standard Educators sold its books. By assigning point values, rather than dollar values, to additional books sold in $50 increments above the basic encyclopedia, the company offered flexibility and benefited from simplified accounting. Since the Commission has not characterized this as an illegal “tie in,” how the mere reference to this legitimate marketing system shows the contract authors’ purpose to deceive remains a mystery to me.

Finally, the FTC claims that the contract provision calling for the customer’s agreement to give his opinion on the New Standard Encyclopedia demonstrates an intention to bolster the salesmen’s suggestion of a special price offered in exchange for an endorsement. Apparently, the Commission completely overlooked the more obvious possible purpose for this contract clause: an actual desire to obtain testimonials for use in advertising the product. The technique of advertising by testimonials has not, so far, been ruled illegal. As with the previously cited inferences, the Commission has chosen the one explanation of the contract drafters’ purpose, in preference to the many possible legitimate ones, which leads to a finding of intent to deceive; and it has made its choice for no other reason, from all that appears in the record, than that the desired result of holding Mr. Melley individually responsible could thereby be reached.

What the Commission has done in its analysis of the contract is subtly to shift the burden of proof. For example, with regard to the testimonials, the Commission apparently felt that, once there was a showing that the contract clause actually corresponded to salesmen’s misrepresentations, Melley bore the burden of demonstrating a legitimate purpose for the language. This approach no longer requires the complaint counsel to make a substantial showing that the prohibited purpose existed. It clearly conflicts with accepted notions of where the burden falls in such a proceeding. In addition, it is most unfair, since the Commission drew its inferences about intent after the hearing at which Melley could have presented rebuttal evidence. Once Mr. Melley’s counsel had established that the contract itself was not deceptive, he might well have reasonably concluded that his need to present further evidence on the language used had ended. Given the extremely tenuous nature of the FTC’s further inferences from the contract’s language to its drafters’ purpose, I for one cannot blame Melley’s counsel for failing to anticipate and rebut them.

This case comes down, in the end, to questions of Mr. Melley’s state of mind his purpose in drafting the contracts and his knowledge of the detailed practices of salesmen in the field. That question necessarily turns to a large degree on the credibility of Melley’s testimony; and the hearing examiner, who had the best opportunity to assess Melley’s credibility, believed him.

The Commission obviously wanted very badly to overturn the hearing examiner’s ruling. It took an unlikely end run via inferences that contract language, innocent on its face and serving other legitimate purposes, was intended to be used for deception merely because it was actually so used by some salesmen. That sort of analysis would justify an inference that a company officer who authorized door-to-door sales must have intended to foster misrepresentation because that method of sale may provide the personal contact necessary for an unscrupulous and talented salesman to convince the customer that he is getting a special price because he lives at that address, came to the door within one minute, or has a nice face. Everything that facilitates a sale could be la-belled “an integral part” of the salesman’s deceptive scheme; but, when a possible proper use appears, and absent additional evidence, the intent of the supplier that it be used deceptively should not be so lightly inferred.

Though this court normally gives deference to administrative agency decisions, if supported by testimony, I am not aware of any “expertise” in the Federal Trade Commission which permits it to find an individual responsible for deceptive conduct, and to issue a cease and desist order against that individual, when no evidence in the record makes the inference it draws any more likely than an inference clearing him of personal responsibility. That this court need not respect a greater aptitude in the FTC for drawing deductive logical conclusions is amply demonstrated by the outrageous manner in which the Commission has constructed its “chain” of “reasoning” in this case.

It seems to me that affirmance here either changes the law by holding corporate officers individually liable to cease and desist orders with regard to acts with which they had no connection, save their “mere ownership and control,” or it gives the FTC a mandate to exercise no less than mystical powers. The Commission may, under the sort of reasoning approved here, act not on the basis of the record created by its complaint counsel but on sheer instinct. Heretofore such a modus operandi has been more common in the sensational press than in quasi-judicial proceedings.

Since Melley has not been shown ever personally to have participated in any deceptive practice, he is not even being given the dubious benefits of the “bad man” theory. This record would not even support a high-handed attempt to enjoin, and therefore brand as a likely offender, one with a proven “predilection” to violate the law.

Rather, it appears that the FTC and the majority have carved a new niche in the law for “guilt by office” and “guilt by association.” Mr. Melley is saddled with a “heavy burden of exculpation” even though no inculpating evidence (beyond mere ownership and control-— which is not enough) has been introduced! The majority seems to find that “we know your type” is acceptable logic — at least when applied to a corporation executive rather than a common criminal.

I recognize that there are in fact different standards of proof in criminal trials and civil cease-and-desist order proceedings. But the lower standard in this kind of ease surely cannot be so low that it amounts to no standard of proof or indeed, as here, actually shifts the burden once complaint counsel has rested on a wink or a leer.

Nor can the absence of criminal penalties support an argument that Melley is not harmed by being individually named in the cease and desist order. The upright man need not fear the direct impact of an injunction commanding him to remain honest. But the very existence of the order tells the whole world, unless it too is enjoined, that he alone has been found likely to transgress. By its unfounded order, the FTC has filched Melley’s reputation — a crime more serious than the one alleged, for it enriches the Commission not and makes Melley poor indeed.

I respectfully dissent.

      . We might add, in response to the dissent’s unwarranted characterization of these instances as “scattered misrepresentations,” that petitioners’ own counsel sought to limit the number of customer-witnesses that could be called by the Commission in order “to reduce the case to manageable and realistic proportions” and to avoid burdening petitioners.

      . It is interesting to note that, although the Standard Education Society is apparently not related to Standard Educators, Inc., the record does indicate that when he incorporated Standard Educators, Inc. Mr. Melley made arrangements with Standard Education Society to purchase its line of encyclopedias for resale to the public. Standard Education Society also provides the broadsides used by Standard Educators’ salesmen in their sales presentations. In addition, the false and deceptive practices of Standard Educators, Inc. parallel in many respects the false and deceptive practices condemned in Standard Education Society, including: representing that encyclopedias are given away free or sold at a specially reduced price to selected persons in return for use of the purchaser’s name for advertising; representing that the recipient pays only for purchase of a 10-year annual yearbook extension service; and representing that the recipient was getting a special combination offer not generally available.

      . 15 U.S.C. § 45 (1964).

      . Appendix (hereafter “App.”) at p. 200.

      . 358 F.2d 224, 233 (9th Cir. 1966).

      . See Flotill Products, Inc. v. FTC where reliance, in naming individuals in the order there, “on no other fact than that the three individuals owned and controlled the corporation” was accurately described as “rather cavalier.” 358 F.2d 224, 233.

      . The hearing examiner specifically noted that “Complaint counsel did not point to any evidence — and there is none in the record — that Mr. Melley committed any illegal act in his individual capacity, or that Mr. Melley is likely to violate the act in the future in his individual capacity, or that he will attempt to evade any order which may be issued against the corporate respondent.” App. at pp. 181-182 (emphasis added).

      . 302 U.S. 112, 58 S.Ct. 113, 82 L.Ed. 141 (1937).

      . The hearing examiner specifically noted that “[t]here is no evidence of record to indicate that the corporate entity is a sham or that Mr. Melley organized the corporation in an attempt to evade any order which may he issued . . . . ” App. at p. 183.

      . The offense charged there involved a “well-matured” “general sales plan” “outlined in letters going directly from the companies.” 302 U.S. 112, 115-117, 58 S.Ct. 113, 115, 82 L.Ed. 141 (1937).

      . 352 F.2d 313 (8th Cir. 1965). The violation charged concerned preticketing of merchandise. That practice was of the sort necessarily planned and supervised as a matter of company policy, and could hardly have originated with a frolic and detour by individual non-policymaking employees. Therefore, the fact that the officers involved “formulated, directed and controlled the policies and practices of the corporate respondents” was enough to justify individual direction of the cease and desist order. 352 F.2d 313, 324. See also Pati-Port, Inc. v. FTC, 313 F.2d 103 (4th Cir. 1963), where the individuals named had, on request from a subordinate, specifically approved the illegal practices.

      . Testimony was introduced concerning twelve sales at scattered sites during a period from February 1965 to May 1968. A dispersed pattern of abuse might well merely suggest that dishonest salesmen get around and pick up the tricks of their trade from each other. Even if central control is inferable, who sent directives from above would still not have been shown. Indeed, their widely scattered character could increase the chances that company headquarters would not learn of violations.

      . Mr. Melley testified that if salesmen “are caught in misrepresentation, they, are fired.” App. at p. 404.

      . 359 F.2d 351 (9th Cir. 1966), cert. denied, 386 U.S. 908, 87 S.Ct. 851, 17 L.Ed.2d 782 (1967). In that case, the court noted that “despite Meyer’s denials of knowledge of the operations of his business, the Commission was justified in concluding that ‘if “a majority of Portland’s 120,000 families” were apprised of the details of these [deceptive] programs, we think it is a fair inference that the Chairman of the Board also knew about them.’ ” 359 F.2d 351, 368.

      . App. at p. 380.

      . 338 F.2d 149 (1st Cir. 1964). “In the absence of evidence of personal involvement in Coro’s [the company’s] unlawful conduct,” a showing of “overall corporate responsibility” was held not enough to support direction of the cease and desist order against an individual who was the largest corporate shareholder, President, and Chairman of the Board.

      . App. at p. 362.

      . App. at p. 351.

      . App. at p. 198.

      . App. at p. 351.

      . 198 F.2d 404 (2nd Cir. 1952). In this case, deceptive order forms furnished by tlie company supported an inference that the corporate officers “actively encouraged and participated in making the said false representations.” 198 F.2d 404, 407.

      . 187 F.2d 693 (7th Cir. 1951). Since the literature provided by the company, in this case, was held to be deceptive in its own right, the corporate officers could not escape responsibility just because even more misleading statements were made by salesmen.

      . App. at p. 198.

      . App. at p. 199 (emphasis added).

      . App. at p. 365.

      . App. at p. 217.

      . Presumably, Melley might have met this novel burden by showing that an ad campaign based on testimonials was in fact conducted. However, even if the contract clause had been inserted with a bona fide intent to collect endorsements, there are many possible reasons wby an ad campaign might not in fact have resulted. In that event, the difficulties of showing a proper purpose merely highlight the need for scrupulous care whenever guilty intent is presumed and the accused must prove the negative,

      . This approach is highlighted by the elaborate but irrelevant exposition by the majority, in footnote 2, attempting to link this case to Standard Education Society. Mr. Melley’s former legitimate business dealing with that firm, of course, have no probative value. The similarity of the conduct of salesmen in both cases may testify to the endurance of the confidence game — but it simply cannot show Mr. Melley’s personal involvement in their violations. Recognizing this, the majority is reduced to listing these facts as merely “interesting to note” — exactly the sort of improper “raised eyebrow” technique in which the commission was engaged.


source: Caselaw Access Project

author: PER CURIAM:

license: Public Domain

text:
    DAN-AIR SERVICES, LTD., Petitioner, v. CIVIL AERONAUTICS BOARD, Respondent. BRITISH MIDLAND AIRWAYS, LTD., Petitioner, v. CIVIL AERONAUTICS BOARD, Respondent. BRITISH MIDLAND AIRWAYS, LTD., Appellant, v. CIVIL AERONAUTICS BOARD.
    Nos. 72-1666, 72-1786, 72-1770.
    United States Court of Appeals, District of Columbia Circuit.
    Argued Oct. 10, 1972.
    Decided March 15, 1973.

      Lester M. Bridgeman, Washington, D. C., with whom Jeffrey M. Lang, Washington, D. C., was on the brief for petitioner in No. 72-1666.
    Paul Reiber, Washington, D. C., with whom Herbert A. Rosenthal, Washington, D. C., was on the brief, for appellant in No. 72-1770 and petitioner in No. 72-1786.
    Warren Sharfman, Associate General Counsel, Civil Aeronautics Board, with whom R. Tenney Johnson, General Counsel, O. D. Ozment, Deputy General Counsel, Robert L. Toomey, Atty., Civil Aeronautics Board, and Howard E. Shapiro, Atty., Department of Justice, were on the brief for respondent in No. 72-1666 and 72-1786 and appellee in No. 72-1770.
    Before McGOWAN and MacKINNON, Circuit Judges, and WYZANSKI Senior United States District Judge for the District of Massachusetts.

       Sitting by designation pursuant to 28 XJ.S. O. § 294(d) (1970).

   PER CURIAM:

Dan-Air Services, Ltd. (Dan-Air) and British Midland Airways, Ltd. (BMA) are foreign air carriers authorized to engage in charter operations between the United States and England. They seek review of Civil Aeronautics Board Order 72-6-59 which implements a condition in their operating authority by requiring that they (and another carrier) file for advance approval of all passenger charter flights at least 25 days prior to flight date, and forbidding the operation of a charter flight for which such approval has not been obtained. The case also involves an appeal by BMA from the District Court’s denial of BMA’s motion for preliminary injunction seeking to restrain enforcement of the same Board order pending final disposition of a complaint for a permanent injunction filed in that court by BMA more than a month prior to its petition for statutory review.

The authority of Dan-Air and BMA to operate into and out of the United States is derived from foreign air carrier permits issued pursuant to orders of the Board entered under section 402 of the Federal Aviation Act (49 U.S.C. § 1372) after approval by the President under section 801 (49 U.S.C. § 1461). These permits authorize the carriers to conduct operations between points in the United States and the United Kingdom, limited exclusively to charter flights as defined in Part 214 of the Board’s Economic Regulations. Condition (4) of appellants’ operating permits provides as follows:

(4) The exercise of the privileges granted by this permit, except with respect to inclusive tour charters, shall be subject to the provisions of Part 214 of the Board’s Economic Regulations, and all amendments and revisions thereof as the Board, by order or regulation and without hearing, may adopt. (J.A. 23, 60.)

Part 214 contains the definitions and regulations governing operations by the holders of all foreign air carrier permits which authorize charter transportation only. The regulations applicable to pro rata charters embody the concept of “affinity” of the passengers which the Board has applied for years in drawing the line between bona fide charters and individually ticketed service offered to the public at large. To aid in effectuating this concept, the regulations require the carriers to obtain from the chartering organization “statements of supporting information” in the form prescribed by the appendix to Part 214, designed to demonstrate to the carriers’ satisfaction that the charter participants are indeed eligible for charter transportation. The carriers must obtain this information “at such time as required by the carrier to afford it due time for review thereof” (14 C.F.R. 214.22 and 214.37), and as a general rule the regulations require that the carrier obtain it 30 days prior to departure of the flight in question (14 C.F.R. 214.12(a)).

These regulations are designed to maintain the “affinity” concept which has proven to be inherently difficult to enforce and administer, both for the Board and for the individual carriers. In further seeking to prevent the formation of spurious organizations solely for the purpose of obtaining individual transportation in the guise of affinity charters, the Board has inserted in the operating authority of all foreign air carriers engaging in charter operations the following condition:

(5) The Board, by order or regulation and without hearing, may require advance approval of individual charter trips conducted by the holder pursuant to the authority granted by this permit, if it finds such action to be required in the public interest. (J.A. 23, 60.)

This condition was contained in the petitioners’ permits at the time of their issuance and received their unqualified acceptance.

On June 14, 1972, the Board determined (as it had three months earlier in the case of two other carriers) that it was indeed in the public interest to invoke the advance approval condition in the petitioners’ permits as well as that of a third foreign air carrier. The Board stated that it had

substantial reason to believe that BMA [and] Dan-Air . . . may be regularly engaging in foreign air transportation under terms and conditions not in conformity with Part 214 in that, inter alia, persons are being transported who do not qualify for charter transportation authorized under Part 214. For example, several of the Board’s own employees, responding to public solicitation and mass media advertising, recently bought passage at a fixed price and participated in a number of charter flights operated by those carriers even though those employees did not meet any of the charter eligibility requirements of Part 214. None of the employees who sought the transportation were refused it. (Order 72-6-59.)

While the Board expressly disclaimed any accusation or determination that petitioners (or the other carrier involved) had knowingly violated the terms of their permit, it was the Board’s judgment that “the circumstances are such that the public interest in protecting the integrity of the Board’s regulations which were adopted pursuant to law and in assuring that the carriers’ future operations comply with the permits the Board has granted them” required petitioners (and the other carrier) to obtain advance approval for all passenger charters to be operated into, or out of this country on and after July 15, 1972. The order requires that petitioners submit a request for advance approval to the Board’s Bureau of Operating Rights at least 25 days (reducible to 10 days upon a showing of good cause) prior to the proposed operation of the particular flight for which approval is requested.

Dan-Air did not seek reconsideration, however BMA did. The Board denied BMA’s petition for reconsideration (Order 72-7-44), finding BMA’s contentions unsupportable and unconvincing. It found, among other things, that the requirement would not be burdensome assuming, as BMA assured the Board was the case, that the carrier was complying with the regulations, because “all of the information which they are being required to submit to the Board is being prepared by them in any event” in accordance with the regulations. The Board also concluded that there was no reason for the market to avoid carriers subject to prior approval because there was no reason to fear disapproval of valid charters.

In reviewing the Board’s actions, we note preliminarily that the specific terms of condition (5) are beyond the jurisdiction of this court to review, since section 1006(a) of the Federal Aviation Act (49 U.S.C. § 1486(a)) explicitly excepts from this court’s review “any order in respect of any foreign air carrier subject to the approval of the President as provided in section 801 of this Act,” Indeed Dan-Air expressly concedes the validity of condition (5). The permits issued to petitioners were such orders under section 801 and were duly approved by the President. Accordingly, review of such orders in respect of foreign air carriers is clearly precluded by statute. Pan American World Airways v. C.A.B., 129 U.S.App.D.C. 159, 169, 392 F.2d 483, 493 (1968); British Overseas Airways Corp. v. C.A. B., 113 U.S.App.D.C. 76, 304 F.2d 952 (1962); see also C.A.B. v. Donaldson Lines, 343 F.Supp. 1059 (S.D.N.Y.1972) (appeal pending). Moreover, under traditional equity principles, review is inappropriate. Petitioners accepted their permits containing condition (5) without objection and have enjoyed the benefits conferred by those permits for approximately two years. In these circumstances petitioners should not now be heard to complain of the terms and conditions upon which they were granted the right to operate. F.P.C. v. Colorado Interstate Gas Co., 348 U.S. 492, 502, 75 S.Ct. 467, 90 L.Ed. 583 (1955); see also Callanan Road Improvement Co. v. United States, 345 U.S. 507, 513, 73 S.Ct. 803, 97 L.Ed. 1206 (1953).

Distinct from the nonreviewable order originally granting petitioners’ permits is the order in question here invoking condition (5) which all parties concede is reviewable. Petitioners assert the invalidity of this order on the ground that it constituted an “amendment, cancellation, suspension, or revocation” of their certificate and therefore, under section 801, required prior Presidential approval. There is no merit to this contention since the implementation of condition (5) in no way could modify- or diminish the scope of an operating permit which at all times was subject to that condition. Moreover, the President previously had expressly approved the permits containing condition (5) which by its terms cannot be read to contemplate another Presidential approval of its invocation.

Petitioners also contend that the Board’s order constituted a de facto rev-oeation, modification or suspension and is invalid since it was issued without the notice and hearing required by section 402(f) of the Act (49 U.S.C. § 1372(f)). This is similar to the first claim. Again, the simple answer is that the invocation of condition (5) was not in any realistic sense a revocation, modification or suspension of permits which were issued subject to this express condition enabling the Board to take this very action. This order is in complete accordance with the provisions of these permits and in no way diminishes their operating authority.

Petitioners argue further that the Board, in entering its order failed to comply with the literal terms of condition (5). They claim that the phrase “ . . . if it finds such action to be in the public interest” requires a formal finding made on an evidentiary record. This, however, does not comport with a common sense reading of the provision especially in light of its essential purposes. Condition (4) made these permits subject to the Board’s affinity regulations. Condition (5) merely allowed the Board, in those cases where it had some reason to believe that its regulations were being violated, to require that proof of compliance be submitted in advance of the particular flight. Since condition (5) contemplates a decision without a hearing, the term “finds” is better interpreted not as the legal term of art encompassing a formal evidentiary hearing, but rather as a broad determination or conclusion that there is a rational basis to believe that violations of the Board’s regulations are in fact occurring. Here the order of the Board indicates that it had made such a determination and proceeded to act in strict compliance with the terms of condition (5). No further finding is required.

There is also a lack of substance to the argument that the order is invalid since condition (5) dispenses only with the need of a hearing but says nothing about notice. Clearly notice would serve little purpose where the Board is under no compulsion to consider the arguments and objections of the parties affected. We find that condition (5) in providing for summary Board action without hearing impliedly dispenses with any formal notice requirements.

Lastly, BMA alleges discriminatory enforcement in the Board’s implementation of this condition only with respect to certain British air carriers (BMA br. at 50). It must be emphasized, however, that the Board consistently has disclaimed any punitive design in the issuance of this order. As the Board stated in its order dismissing BMA’s petition for reconsideration, the order is designed to aid the carriers in complying with regulations they have admittedly found difficult to enforce on their own and, if the carriers are in fact complying with Board regulations, there is no reason to withhold approval for proposed charters. Moreover, the Board indicated that it was proceeding on an ad hoc basis as efficiently as practicalities would permit. Even had this order been issued in a punitive context, BMA has failed to show the “patent abuse of discretion” necessary to establish a case of discriminatory enforcement. F.T.C. v. Universal-Rundle Corp., 387 U.S. 244, 87 S.Ct. 1622, 18 L.Ed.2d 749 (1967).

The Board’s actions are accordingly-affirmed and therefore we need not consider the propriety of the District Court’s denial of the preliminary injunction.

Affirmed.

      . The Board’s order was issued on June 14, 1972, and became effective the next day. BMA’s complaint in the District Court was filed July 6 and on the same day that court issued a temporary restraining order. On July 18 the District Court denied BMA’s motion for preliminary injunction, but on July 20 it granted a 30-day injunction pending appeal. BMA perfected its appeal on August 11 and on the same day moved this court for a further injunction pending disposition of the appeal and on August 18 we granted the requested stay. The petition for statutory review of the Board’s order was filed August 16.

      . Dan-Air’s permit was issued pursuant to Order 70-10-137 which was approved by the President on October 27, 1970. BMA’s was issued pursuant to Order 70-6-3, approved by the President on May 28, 1970.

      . 14 C.F.R. 214.

      . “Charter” is a term denoting a fundamental distinction between group travel and individually ticketed travel by passengers drawn from the general public. It is not defined by the Act and is thus subject to refined definition and regulation by the Board. Trans International Airlines v. C. A. B., 139 U.S.App.D.C. 174, 432 F.2d 607 (1970); American Airlines v. C. A. B., 125 U.S.App.D.C. 6, 365 F.2d 939 (1966); American Airlines v. C. A. B., 121 U.S.App.D.C. 120, 348 F.2d 349 (1965).

      . To this end, the regulations require that the “charter group” i. e., “that body of individuals who shall actually participate in the charter flight” (14 C.F.R. 214.2 (h)) be derived from the membership (or immediate families of members) of an organization, club or other entity. Persons who have joined the organization “merely to participate in the charters” are not deemed to be bona fide members of the chartering organization (14 C.F.R. 214.30(b)(1)) and persons who have not been members of the organization for six months prior to the charter flights are not bona fide members (14 C.F.R. 214.30(b) (2)). Moreover, the regulations provide that the organization must maintain a central membership list available for inspection by the carrier to insure that the participants in the flight are limited to actual members of the organization and their immediate families and to insure that they have been members for the requisite period of time (14 C.F.R. 214.31). Finally, carriers such as petitioners are forbidden to carry persons solicited “under circumstances in which the services are advertised in mass media, whether or not the advertisement is addressed to members of a specific organization, and regardless of who places or pay for the advertising.” (14 C.F.R. 214.30(a)(1)).

      . The order was not applicable to “inclusive tour charters” since prior affinity is not required for such charters. It may also be noted that the Board has recently provided for a new kind of charters, “travel group charters,” which, like inclusive tour charters, do not require that the participants have prior affinity. See SPB.-61, September 27, 1972.

      . Section 1006(a) provides in full:
      Any order, affirmative or negative, issued by the Board or Administrator under this chapter, except any order in respect of any foreign air carrier subject to the approval of the President as provided in section 801 of this Act, shall be subject to review by the courts of appeals of the United States or the United States Court of Appeals for the District of Columbia upon petition, filed within sixty days after the entry of such order, by any person disclosing a substantial interest in such order. After the expiration of said sixty days a petition may be filed only by leave of court upon a showing of reasonable grounds for failure to file the petition theretofore. (Emphasis added.)

      . Dan-Air br. at 14; reply br. at 1.

      . Section 801 (49 U.S.C. § 1461) provides in full:
      The issuance, denial, transfer, amendment, cancellation, suspension, or revoeation of, and the terms, conditions, and limitations contained in, any certificate authorizing an air carrier to engage in overseas or foreign air transportation, or air transportation between places in the same Territory or possession, or any permit issuable to any foreign air carrier under section 402, shall be subject to the approval of the President. Copies of all applications in respect of such certificates and permits shall be transmitted to the President by the Board before hearing thereon, and all decisions thereon by the Board shall be submitted to the President before publication thereof.

      . See note 2, supra.

      . See note 9, supra.

      . Section 402(f) provides as follows:
      Any permit issued under the provisions of this section may, after notice and hearing, be altered, modified, amended, suspended, canceled, or revoked by the Board whenever it finds such action to be in the public interest. Any interested person may file with the Board a protest or memorandum in support of or in opposition to the alteration, modification, amendment, suspension, cancelation, or revocation of a permit.

      . Arguments and objections of the parties may be heard on petition for reconsideration of the Board’s order as BMA in fact did in this case.

      . Order 72-7-44 denying BMA’s petition for reconsideration expressly adopts the reasoning of Order 72-5-35 dealing with Donaldson International Airways in an identical case.

      . . . it is apparent that the Board cannot and need not investigate everything at the same time. The Board must necessarily deal with some things first and its power to investigate and deal with emergent matters of greatest seriousness at the outset cannot be defeated because other matters of a similar nature remain for investigation at a later date.” C.A.B. Order 72-5-35 incorporated by reference in Order 72-7-44.


text:
    SOUTHLAND MANUFACTURING CORPORATION, Petitioner, v. NATIONAL LABOR RELATIONS BOARD, Respondent.
    No. 71-2059.
    United States Court of Appeals, District of Columbia Circuit.
    March 16, 1973.

      L. Wayne Townsend, Richmond, Va., was on the brief for petitioner.
    Peter G. Nash, Gen. Counsel, Mar-eel Mallet-Prevost, Asst. Gen. Counsel, Baruch A. Fellner and John M. Flynn, Attys., for the N. L. R. B., were on the brief for respondent.
    Before FAHY, Senior Circuit Judge, and McGOWAN and LEVENTHAL, Circuit Judges.
   PER CURIAM:

In 1966 the National Labor Relations Board issued its decision that Southland Manufacturing Corporation had violated Sections 8(a)(1), (3), and (5) by wrongfully discharging an employee, refusing to reinstate striking employees, and shutting down its plant. The Board ordered the company to pay back pay and reinstate the discriminatees. That decision was affirmed by this court in United Hatters, Cap & Millinery Workers, International Union v. NLRB, 126 U.S.App.D.C. 149, 375 F.2d 325 (1967). In 1971 the Board issued a Supplemental Decision and Order determining the amount of backpay for which Southland is liable, and this case is before us on a petition to review and set aside that determination.

Southland raises four objections to the Board’s Supplemental Decision: The backpay liability was contingent upon resumption of business operations; the Board was guilty of laches in instituting the proceedings; the Board failed to show compensable loss by the discriminatees; and the Board failed to follow its own guidelines for investigating backpay losses. We find none of these warrants reversal.

1. The portion of the Board’s order relevant to Southland’s contingency argument reads as follows:

We shall order the Respondent, in the event it resumes its operations, to offer Crimilda Acosta and to those striking employees, who were diseriminatorily discharged or denied reinstatement immediate and full reinstatement to their former or substantially equivalent positions and make all such employees whole for any loss of earnings they may have suffered by reason of the unlawful discrimination against them; backpay to run only to the date in February 1965 when the Respondent shut down its plant, the exact date to be determined at the compliance stage. We shall also require the Respondent to make whole those nonstriking employees who were unlawfully locked out from December 7, 1964 to January 11, 1965.

Southland has not resumed its operations, and it contends that the above passage makes its liability for backpay, in respect of periods both before and after its shutdown in February, 1965, contingent upon such resumption. It further notes that this court affirmed the above order, and concludes that the Board cannot now assess backpay without the occurrence of the contingency.

Each party asserts that a strict grammatical construction of the order supports its reading of the modifying clause “in the event it resumes its operations.” Neither argument is compelling, although Southland’s reading has some advantage insofar as purely grammatical indications of meaning are thought to be determinative. The modifying clause precedes both dependent clauses. Were it intended to modify only the “reinstatement” clause, proper placement would be within the clause. Nevertheless, this argument is not conclusive.

The court’s previous reference to the order sheds little light on the contingency issue:

The remedial order, in addition to cease and desist provisions, called affirmatively for reinstatement of certain named employees in the event the company, which at the time of the order had ceased operations, resumed operations, with reimbursement for any loss of earnings suffered as a result of the discrimination against them. .

375 F.2d at 326.

We did, however, note with approval the Board’s reservation of the right to modify the backpay provisions as required in the future. Thus we showed no purpose in affirming the order to confine the Board to the terms of this alleged contingency in the supplemental proceedings. It does not seem rational to suppose that either the court or the Board contemplated that Southland could escape liability for backpay in respect of periods prior to its going out of business.

2. Southland’s second argument is that the Board was guilty of laches in instituting the backpay proceeding. The initial order was entered on April 1, 1966, and this court issued an enforcement order on February 23, 1967. The backpay proceedings began January 21, 1971. Petitioner claims prejudice because, in the meanwhile, records were allegedly lost by petitioner, possible witnesses moved away, and the memories of former employees faded. It cites no specific examples of any of these disadvantages. It called no witnesses other than its president; therefore, the claim concerning the faded memories of former employees is questionable.

The Board answers that laches may not defeat a suit brought by the Government to enforce a public right. In any event, the Board points out that the delay is largely attributable to the intervening proceedings held to determine whether it was Southland or its alleged successor (Propper International, Inc.) which was to be held accountable for the back pay. Affirmance as to this point can rest comfortably on this last-mentioned circumstance.

3. The problem of the adequacy of the Government’s proof is complicated by the sketchy nature of the hearing. Prior to the hearing the Board had, in accordance with its usual practice, filed a detailed specification of the back pay which it had found to be due each individual employee. This specification lists the employees by name and sets forth other relevant information, including the amounts of interim earnings, if any, which are deducted from the amount owing by Southland. These interim earnings are obtained by the Board from the Social Security records.

In its amended answer, Southland stated first that it could not admit or deny the accuracy of the specifications for lack of knowledge as to how the Board formulated them. It did go on to say, however, that its President, Mr. Milstein, “has knowledge of interim earnings and compensation by some of the employees named in the schedules of the specifications which are not reflected in those specifications”; and it went on to say that it expected to be able to produce records as to those alleged interim earnings and compensations at the hearing.

It is to be noted that these allegations in the amended answer relate to interim earnings. There is no suggestion whatsoever by the defense of willful loss of earnings, which is the shorthand way of referring to the fact that an employee makes no effort to find other employment. At the hearing Mr. Milstein was the only witness for Southland. He testified about the vacation pay and December wages refered to in Note 1. He also testified that he had talked to some of the employees, and had ascertained from them that they did nothing more about seeking employment than to register with the United States Employment Service. Although the Examiner let this in over the General Counsel’s objection, it obviously was improper testimony since it went to a defense not even hinted at in the amended answer. Mr. Milstein further testified that he had asked these 30-odd employees whether they had been approached by the Board for information in connection with the ascertainment of interim earnings, and that they had indicated they had not been. It is this testimony on which Southland relies in urging that the Board did not follow its own prescribed procedures,

This was the sum of Southland’s challenge to the specifications at the hearing, and it was not of such a nature to warrant upsetting the Board’s order in this case. The Board proceeded in a proper fashion, and, by means of the specifications, put Southland clearly on notice of what the Board’s investigation showed to be due to each employee in respect of back pay, taking account of interim earnings known to the Board. If Southland had any reason to challenge any one of these computations, it should have done so with a statement of why it thought it was incorrect; and, in that event, it is entirely possible that the Board might have been under the necessity of producing the employee in question or otherwise sustaining its burden of proof. See NLRB v. Rice Lake Creamery Co., 124 U.S.App.D.C. 355, 365 F.2d 888 (1966); NLRB v. Mastro Plastics Corp., 354 F.2d 170 (2d Cir. 1965). In the circumstances of this record, however, the Board was not required to have every employee present personally at the hearing to testify.

4. On the basis of Milstein’s testimony that a few of the employees had indicated to him that the Board had not approached them directly about interim earnings, Southland alleges that the Board failed to follow its own investigatory procedures in this case. That evidence standing alone is insufficient to require disturbance of the Board’s order.

The Petition for Review is Denied.

      . It is also alleged that many of the employees had received vacation pay, and that some had received wages during the period from December 7 through December 21, 1964, and that, as to these matters, Southland expected to be able to produce probative records at the hearing. The Board found ultimately — and we agree— that, as to these particular claims, South-land did not carry its burden of proof. See footnote 4 of the Board’s Supplemental Decision and Order.

      . Rice Lake and Mastro Plastics involved the issue of willful loss of earnings, a defense not raised in the pleadings in this ease. Although the reasoning of those decisions may apply to the question of interim earnings as well, we reserve that question for consideration in a case where the defense of interim earnings has been asserted with the requisite specificity.


author: HUFSTEDLER, Circuit Judge:

text:
    UNITED STATES of America, Plaintiff-Appellee, v. Jerry Mack MALCOLM, Defendant-Appellant.
    No. 72-2183.
    United States Court of Appeals, Ninth Circuit.
    March 8, 1973.

      John K. Van de Kamp, Federal Public Defender, Alan L. Issacman, Deputy Federal Public Defender, San Diego, Cal., for defendant-appellant.
    William D. Keller, U. S. Atty., Stanley I. Greenberg, Earl E. Boyd, Eric A. Nobles, Asst. U. S. Attys., Los Angeles, Cal., for plaintiff-appellee.
    Before HUFSTEDLER and GOODWIN, Circuit Judges, and SKOPIL, District Judge.

       Honorable Otto R. Skopil, United States Judge for the District of Oregon, sitting by designation.

   OPINION

HUFSTEDLER, Circuit Judge:

Malcolm appeals from his conviction for armed bank robbery. (18 U.S.C. § 2113(a) (d).)

The only contested factual issue at trial was his sanity at the time of the offense. Over his objection, the district court admitted the testimony of a psychiatrist who had examined him pursuant to a pretrial order compelling him to submit to an examination to ascertain his sanity at the time of the offense. Malcolm contends that the court erred in admitting the testimony because the pretrial order was invalid on statutory and constitutional grounds and that, even if the order were authorized by 18 U.S.C. § 4244, the testimony exceeded the statutory restrictions imposed by the section upon the use of such testimony. He further argues that the court erred in repeatedly interrupting defense counsel’s examination of witnesses and his closing argument and in instructing the jury, on intent and motive.

When Malcolm first appeared in court, the judge observed that something was seriously wrong with him. Malcolm was dazed and almost stuporous. He could not stand up without support. The public defender told the court that he had been unable to communicate with his client. The marshal reported that Malcolm did not seem to know what was going on around him. The district court tried to address Malcolm personally and was unable to elicit any response. Defense counsel asked the court to appoint a psychiatrist under section 4244 to examine his client and to give his opinion on his competence to stand trial. The district court agreed and promptly signed a form order appointing Dr. Abe. Unknown to defense counsel, the form required Malcolm to submit to a dual purpose psychiatric examination to ascertain not only his competence to stand trial but also his sanity at the time of the offense. The district court did not attempt to inform Malcolm of the contents of the order, and, under the circumstances, any effort to have done so would then have been futile.

Dr. Abe examined Malcolm nine days later. From the face of Dr. Abe’s report, dated September 30, 1971, the examination consisted primarily of a personal interview with Malcolm. Almost all of the report, which is slightly longer than two letter-sized pages, is a recitation of Malcolm’s life history. It narrates his chaotic youth, his mother’s murder of his stepfather, his education, his medical discharge from the Marine Corps for mental disability, his grand mal epileptic seizures, and his brief arrest record. The remainder of the report follows:

“PRESENT ARREST: Defendant states he was arrested for ‘bank robbery.’ He admits holding up with a gun the United California Bank in Pomona. He states further ‘it was an emotional thing.’ By this he means he robbed the bank to get back at a girl friend who works in the bank. ‘Also to go to jail because no where to go.’ Initially, defendant thought he would be shot and killed while robbing the bank. He then found himself walking toward the police station. Someone yelled at him, so he shot at him. He kept walking and also ran at times. Defendant states he will repeat the offense, which he knows is wrong, if placed on the street because T have no place to go.’ He apparently doesn’t mind being in jail.
"MENTAL STATUS EVALUATION: Defendant was a cooperative individual, who manifested no odd or bizarre mannerisms. His speech was relevant and coherent. His affect varied appropriately. No delusions, hallucinations or disordered thinking was apparent. Defendant believes he will be going to prison because of the offense which he has committed. Defendant’s mental grasp and capacity indicate about average intelligence.
“OPINION: Defendant is presently sane. -Defendant is presently able to understand the proceedings against him, is able to assist in his own defense and does not present mental incompeteney.
“Defendant does not have a mental disease or defect causing him to lack substantial capacity either to appreciate the wrongfulness of his conduct or conform his conduct to the requirements of the law.”

The competency issue was submitted to the court solely on Dr. Abe’s report. The court found him competent and arraigned him. Malcolm pleaded not guilty. Defense counsel told the court that the defense would be insanity, and he moved for the appointment of an independent psychiatrist to examine Malcolm, pursuant to section 3006A(e)(1) of the Criminal Justice Act (18 U.S.C. § 3006A(e)(1)). The district court denied the motion. The motion was renewed before trial, and the court granted it.

The government relied exclusively on lay testimony in presenting its case in chief. Malcolm took the stand and admitted the bank robbery. He described his despondency over a broken love affair and said that his motive in robbing the bank was to get himself killed. The defense psychiatrist gave his opinion which, if credited, would have supported a finding of insanity. On rebuttal, the Government called Dr. Abe. Defense counsel objected to the admission of any testimony by Dr. Abe based on or related to statements Malcolm had made to Dr. Abe during his September 29 examination on the ground that section 4244 forbade its use. The court gave two reasons for overruling the objection: (1) The restrictions in section 4244 do not apply when the only question before the court is sanity of the defendant at the time of the offense, and (2) a waiver of the section 4244 restrictions results when defense counsel has obtained a psychiatric examination of a defendant to ascertain sanity.

Dr. Abe testified, in substance, that in his opinion Malcolm was sane when he robbed the bank. He did not quote to the jury any statements that Malcolm made to him, but, as we earlier observed, the foundation for his opinion was Malcolm’s recitation of his whole history, including the bank robbery episode.

I.

Malcolm argues that the order initially appointing Dr. Abe was invalid to the extent that it compelled Malcolm to submit to an examination to ascertain his sanity at the time of the offense because there is no statutory authorization for the order.

The statute upon which the court relied in issuing the order is 18 U.S.C. § 4244 which, in pertinent part, provides:

“Whenever after arrest and prior to the imposition of sentence . . the United States Attorney has reasonable cause to believe that a person charged with an offense against the United States may be presently insane or otherwise so mentally incompetent as to be unable to understand the proceedings against him or properly to assist in his own defense, he shall file a motion for a judicial determination of such mental competency of the accused, setting forth the ground for such belief with the trial court in which proceedings are pending. Upon such a motion or upon a similar motion in behalf of the accused, or upon its own motion, the court shall cause the accused, whether or not previously admitted to bail, to be examined as to his mental condition by at least one qualified psychiatrist, who shall report to the court. . . .No statement made by the accused in the course of any examination into his sanity or mental competency provided for by this section, whether the examination shall be with or without the consent of the accused, shall be admitted in evidence against the accused on the issue of guilt in any criminal proceeding. A finding by the judge that the accused is mentally competent to stand trial shall in no way prejudice the accused in a plea of insanity as a defense to the crime charged; such finding shall not be introduced in evidence on that issue nor otherwise be brought to the notice of the jury.”

Because nothing on the face of section 4244 or in its legislative history purports to authorize an order to appoint a psychiatrist to examine a defendant to ascertain his sanity at the time of an offense, the great weight of circuit opinion is that section 4244 cannot be expanded to encompass such an examination and that the source of authority to issue an order of that type is the inherent power of the court. (E.g., United States v. Driscoll (2d Cir. 1968), 399 F.2d 135, 137-138, 139; United States v. Albright (4th Cir. 1968), 388 F.2d 719, 722; Featherstone v. Mitchell (5th Cir. 1969), 418 F.2d 582, 584; United States v. Bohle (7th Cir. 1971), 445 F.2d 54; United States v. Maret (8th Cir. 1970), 433 F.2d 1064, 1067.)

The Ninth Circuit’s views are not crystalline. In Wade v. United States (9th Cir. 1970), 426 F.2d 64, 74, our court, sitting en banc, recognized that both the source of power to compel a defendant to submit to a psychiatric examination and the mode of its exercise raised serious statutory and constitutional questions. We expressly refused to decide the questions because it was not strictly necessary to reach them in disposing of the case. A panel in United States v. Handy (9th Cir. 1971), 454 F.2d 885, 889, briefly discussed these issues and inconclusively observed that the foundation for the questioned order could be section 4244 or inherent power of the court. A different panel writing United States v. Mattson (9th Cir. 1972) 469 F.2d 1234 assumed, without analysis, that section 4244 authorizes a dual purpose examination.

The questions are squarely presented in Malcolm’s ease, and we think they should be squarely answered. Accordingly, we bring the Ninth Circuit into line with the Second, Fourth, Fifth, Seventh, and Eighth Circuits by holding that section 4244 does not authorize an order compelling a defendant to submit to a psychiatric examination to determine his sanity at the time of the offense and that the source of power to order such an examination is the inherent power of the court.

Our holding does not automatically invalidate the order questioned in this case or an order in any other case erroneously based on section 4244. Such orders are valid if, under the particular facts and circumstances of the ease, the order did not impermissibly infringe the defendant’s constitutional guaranties and if it did not exceed the bounds of discretion committed to the district court in exercising its inherent powers.

The constitutional guaranty of the right not to incriminate oneself is a limitation on the inherent power of the court to compel a defendant to submit to a psychiatric interview to ascertain his sanity at the time of the offense. Unlike an examination to ascertain competence to stand trial, the purpose of an interview to probe sanity at the time of the offense is to obtain information from the accused bearing directly on his guilt. If the defendant has knowingly and voluntarily requested such an examination, the Fifth Amendment presents no problem. (Cf. McCarthy v. United States (1969), 394 U.S. 459, 466, 89 S.Ct. 1166, 22 L.Ed.2d 418.)

The Fifth Amendment right looms as soon as the court, on its own motion or the prosecutor’s, orders the defendant to submit to the examination. Courts have regularly surmounted this hurdle when the Government has asked for such an examination after the defendant has raised the insanity defense and has introduced or has indicated that he will introduce, the testimony of his examining psychiatrist directed to the sanity issue. The rationale for the result is not always clear; the recurring themes are estoppel, waiver, and fairness.

When a defendant, personally or through his counsel, raises his privilege in opposition to an order compelling him to submit to a sanity examination before he has indicated his intent to rely on insanity as a defense and before he has shown his intent to rely on an examining psychiatrist’s testimony to support it, his objection cannot be defeated by using the estoppel, waiver, or fairness theories. Under such circumstances, he has done nothing upon which to predicate an estoppel or from which to find any waiver. Invocation of a fairness doctrine to overcome a properly invoked Fifth Amendment right, absent any foundation for waiver or estoppel, would erode and could potentially destroy the right.

When the court ordered the psychiatric examination to ascertain sanity at the time of the offense, no steps had been taken by Malcolm to invoke the insanity defense. If an objection to the order had been then interposed, the district court would have been obliged to confront the constitutional issue, and, if the objection were overruled, we too would have had to reach the question. However, the constitutional objection was never raised before the district court; accordingly, we decline to reach it.

Malcolm urges that the order was invalid to the extent that it went beyond an examination to determine his competency to stand trial because neither he nor his lawyer had notice of the dual nature of the order. There is force in the argument, but our court in United States v. Mattson, supra, 469 F.2d 1234 rejected the Second Circuit’s decision of the point in his favor and accepted the views of the dissenter in United States v. Driscoll, supra, 399 F.2d 135. Unless Mattson is overturned by our court en banc or by contrary Supreme Court authority, Mattson binds this circuit on the issue.

We conclude that the validity of the initial order authorizing the psychiatric examination to determine competency, pursuant to section 4244, and to ascertain sanity at the time of the offense, pursuant to inherent court power, cannot be successfully challenged on this appeal on constitutional grounds.

II

We turn to the questions raised by the admission, over objection, of Dr. Abe’s testimony on the sanity issue. Because Dr. Abe was appointed pursuant to section 4244 to examine Malcolm upon his competency to stand trial, the statutory restrictions upon the use of information obtained from such examinations apply to the reception of Dr. Abe’s testimony, even though the second aspect of the examination was not bounded upon the statute.

The first limitation is that “[n]o statement made by the accused in the course of any examination into his sanity or mental competency provided for by this section, whether the examination shall be with or without the consent of the accused, shall be admitted in evidence against the accused on the issue of guilt in any criminal proceeding.” Malcolm contends that permitting a psychiatrist who conducted a section 4244 examination to testify for the Government on the sanity issue violates that restriction because the psychiatrist’s opinion rests primarily on his statements to Dr. Abe and that no effective cross-examination can be conducted without probing what Malcolm had told him. Congress could have resolved the matter by forbidding the examining psychiatrist from testifying at the trial on the merits, but it did not do so. (United States v. Mattson, supra, 469 F.2d 1234.) It chose instead to frame the limitation in terms of statements made by the accused. If the examining psychiatrist does not testify to the statements of the accused, his testimony is not foreclosed by section 4244. Moreover, the section does not prevent defense counsel from bringing out statements of the accused on cross-examination. Since the exclusion is for a defendant’s benefit, he can waive it. Defense counsel may decide to forgo exploration of the statements because he believes that the disclosures would hurt his case, but that election is a matter of trial tactics, not a matter of statutory command.

However, we agree with Malcolm that the section 4244 limitation upon the use of an accused’s statements to the examining psychiatrist is not eliminated when the only factual issue in the trial on the merits is defendant’s sanity at the time of the offense. Competence to stand trial does not go to the guilt of an accused, but sanity at the time of the offense is one of the components of guilt when it involves a particular state of mind which is an essential element of the offense charged or when, under the applicable test for mental responsibility, insanity provides exoneration from the crime charged. When a psychiatrist, who conducted a section 4244 examination, testifies for the Government on the sanity issue at trial on the merits, he is testifying “against the accused on the issue of guilt in any criminal proceeding”; accordingly, he cannot testify on direct examination to statements that the accused made to him during the course of his psychiatric examination.

We also agree with Malcolm that the section 4244 restrictions do not evaporate when a defendant has requested such an examination or when he has received an independent psychiatric examination on the insanity issue. The statute expressly states that the restrictions apply even though the accused consented to the examination. The receipt of an independent psychiatric examination on the sanity question may provide the foundation for a claim of waiver of his right against self-incrimination, asserted to thwart a Government motion that he submit himself to its expert to examine him on the sanity issue. It has no effect, however, upon the congressional directive in section 4244. A waiver of the exclusionary rule of section 4244 cannot be based solely on the act of an accused in obtaining a psychiatric examination for a very different purpose (sanity at the time of the offense) than that encompassed by section 4244 (competency to stand trial).

An appropriate basis for finding a valid waiver is here presented. By the time Dr. Abe testified on rebuttal, Malcolm himself had testified and had introduced the testimony of his examining psychiatrist on the sanity issue. Dr. Abe did not testify to anything that Malcolm told him during the examination. Under these circumstances, the section 4244 exclusionary rule was not infringed and no basis exists for challenging the district court’s ruling as an abuse of the court’s inherent discretionary power.

III.

Defense counsel was understandably disturbed by the district court’s frequent interruptions of his interrogation of witnesses and of his interruption of his closing argument. The court often intervened in the prosecution’s case as well. The trial court is, of course, more than an umpire. It properly participates in the examining of witnesses for the purpose, among others, of clarifying the evidence, controlling the orderly presentation of the evidence, confining counsel to evidentiary rulings, and preventing undue repetition of testimony. The trial court’s role is especially sensitive in a jury trial. It must be ever mindful to eschew advocacy or the appearance of advocacy. (E.g., Blunt v. United States (1957), 100 U.S.App.D. C. 266, 244 F.2d 355, 363-366.) We have examined the entire record to determine whether, as Malcolm claims, the district court overstepped the bounds of acceptable trial conduct. Although from our vantage point of hindsight we can see that a greater reluctance quickly to intervene at times may have been warranted, we conclude that the conduct of the district court fell short of Malcolm’s appellate mark.

We decline to reach the claimed error in instructing the jury. Defense counsel initially acquiesced in the instruction. His protest after the jury was instructed came too late. Rule 30, Fed.R.Crim.Proc., applies.

Affirmed.

      . Exercise of the court’s discretion in favor of granting the motion under the circumstances of this case was well advised. United States v. Schultz (8th Cir. 1970). 431 F.2d 907.

      . The House Report, echoing the Senate Report, explained that “[t]he bill provides for a uniform procedure for delinquents suffering from mental disorders which exist ... at the time of trial.” (H.R.Rep. No. 1309, 81st Cong., 1st Sess. (1949) ; 2 U.S. Code Cong.Serv. 1928 (1949).) Section 4244 was enacted because “[e]xisting Federal statutes prescribe no procedure whatever for determination of an accused person’s mental competence to stand trial and there are but few judicial questions on the question.” Id.

      . The view of the District of Columbia Circuit is different, but not necessarily to the contrary. The circuit is firmly committed to the practice of dual purpose pretrial psychiatric examinations when there is anything in the accused’s history that casts doubt either on his competence to stand trial or on his sanity at the time of the offense. But its opinions do not reveal the path of logic from the federal or district statutes to its conclusion. The opinions can be read as finding authority in inherent court power as well as in § 4244 or in its District counterpart. E. g., Mitchell v. United States (1963), 114 U.S.App.D.C. 353, 316 F.2d 354; Edmonds v. United States (1959), 106 U.S.App.D.C. 373, 273 F.2d 108; Winn v. United States (1959), 106 U.S.App.D.C. 133, 270 F.2d 326.

      . The reasoning is cloudy in United States v. Handy, supra, 454 F.2d at 888-889, the only Ninth Circuit case that considered the problem; the discussion shuttles between a largely unarticulated concept of fairness and an oblique mention of the Schmerber line of cases (Schmerber v. California (1966) 384 U.S. 757, 86 S.Ct. 1826, 16 L.Ed.2d 908). A sampling of circuit views includes: United States v. Baird (2d Cir. 1969), 414 F.2d 700, 707 (estoppel); United States v. Albright, supra, 388 F.2d at 723, 724 (truth and fairness).

      . “There is a vast difference between that mental state which permits an accused to be tried and that which permits him to be held responsible for a crime. ‘ [E] xaminations, made for the purpose of determining his competency to stand trial . . . require less than examinations designed to determine sanity for the purpose of criminal responsibility.’ It is not to be assumed, therefore, that a psychiatrist who has been ordered to prepare an opinion as to a man’s trial competency will conduct the type of examination which is necessary to provide the trier of the facts with the information essential for a proper determination of criminal responsibility. In addition to the psychological and neurological tests which may be indicated, that determination requires adequate knowledge and a proper expert evaluation of the accused’s personal history and the circumstances surrounding the crime.” Winn v. United States, supra., 270 F.2d at 328 (citations omitted).
      This segment of Winn was quoted with approval in Driscoll, supra., 399 F.2d at 138, with which observations the dissenter in Driscoll agreed, id. at 140.

      . We do not reach the question whether the court’s sua sponte exercise of its inherent power to issue a pretrial order compelling a defendant to submit to a psychiatric examination to ascertain sanity at the time of the offense is an abuse of discretion because the point was not raised below, and it is raised only tangentially on appeal.

      . Other alternatives founder on the impracticability of fragmenting a dual purpose interview or the impropriety of our ignoring manifest congressional intent.

      . The second limitation of § 4244 is not in issue here: “A finding by the judge that the accused is mentally competent to stand trial shall in no way prejudice the accused in a plea of insanity as a defense to the crime charged; such finding shall not be introduced in evidence on that issue nor otherwise be brought to the notice of the jury.”

      . Canon 15 of the American Bar Association’s Canons of Judicial Ethics provides that:
      “A judge may properly intervene in a trial of a case to promote expedition, and prevent unnecessary waste of time, or to clear up some obscurity, but he should bear in mind that his undue interference, impatience, or participation in the examination of witnesses, or a severe attitude on his part toward witnesses, especially those who are excited or terrified by the unusual circumstances of a trial, may tend to prevent the proper presentation of the cause, or the ascertainment of the truth in respect thereto.
      “Conversation between the judge and counsel in court is often necessary, but the judge should be studious to avoid controversies which are apt to obscure the merits of the dispute between litigants and lead to its unjust disposition. In addressing counsel, litigants, or witnesses, he should avoid a controversial manner or tone.
      “lie should avoid interruptions of counsel in their arguments except to clarify his mind as to their positions, and he should not be tempted to the unnecessary display of learning or a premature judgment.”


author: ESCHBACH, District Judge.

text:
    In the Matter of the Petition of O. L. SCHMIDT BARGE LINES, INC., as owner of the MOTOR VESSEL MARY R, for exoneration from or limitation of liability.
    Nos. 71-1498 to 71-1500.
    United States Court of Appeals, Seventh Circuit.
    Argued Nov. 27, 1972.
    Decided March 7, 1973.
    Rehearing Denied April 9, 1973.

      Paul McCambridge, Philip H. Corboy, Chicago, Ill., for appellant.
    Joseph V. McGovern, Michael A. Snyder, Chicago, Ill., for appellee.
    Before KILEY and STEVENS, Circuit Judges, and ESCHBACH, District Judge.

       District Judge Jesse E. Eschbach of the Northern District of Indiana is sitting by designation.

   ESCHBACH, District Judge.

A petition was brought in the district court by O. L. Schmidt Barge Lines, Inc. (“Schmidt”), as owner of the tugboat M/V MARY R, for exoneration from or limitation of liability for loss, damage and injury arising out of a collision on the Little Calumet River between the barge in tow of the MARY R and a motorboat owned and operated by Joseph Moss. Claims for damages for personal injuries were filed in limitation proceedings by Moss and the other occupants of the motorboat who survived the collision (Dean Steglieh, Peter O’Malley and Lawrence Regan). Claims for wrongful death were filed by the Administrator of the Estate of George O’Donnell, Jr., an occupant of the motorboat who was drowned in the accident, against both Schmidt and Moss. After a trial on the issue of liability before the district court sitting in admiralty, a decree was entered exonerating Schmidt from liability for the casualty. Judgment was also entered granting recovery for the decedent’s estate on the issue of liability on its cross-claim against Joseph Moss.

Moss appeals in No. 71-1499 from the judgment of the trial court finding him liable for the collision and, in No. 71-1500, from the decree exonerating Schmidt. The latter appeal originally included claimants Steglieh, O’Malley and Regan, but was later dismissed as to them pursuant to their motion. O’Donnell’s estate appeals only from the decree of exoneration in favor of Schmidt. (No. 71-1498). We affirm.

The collision occurred at about 9:00 P.M. on August 19, 1968, immediately west of the Indiana Avenue Bridge over the Little Calumet River at Chicago, Illinois. The MARY R was proceeding down the river in a westerly direction pushing in front of it Barge No. 26, a 254-foot tank barge which was empty at the time. As the MARY R approached the Indiana Avenue Bridge, its speed was slowed to enable passage of the 50-foot wide barge through the south draw of the bridge, a passage having a width of about 62 feet. The towboat maintained a speed of about three miles per hour until the time of the collision. The pilot of the MARY R used a searchlight to illuminate the banks of the river and the pilings protecting the south draw of the bridge. Gerald Toomey, a deckhand who was acting as lookout, stood on the forward end of the barge with his back to the pilot and gave flashlight signals to guide the barge through the opening. As the head of Barge 26 cleared the east pile clusters of the south draw, Toomey turned and walked aft on the barge to take down a warning flag so that it would not hit the underside of the bridge as the barge passed through the draw.

As the MARY R was descending the river toward the Indiana Avenue Bridge, the 16-foot outboard motorboat which Moss had purchased only two days earlier was docked at the Seaways Marina gas dock which was located on the north bank of the river approximately 130 feet west of the Indiana Avenue Bridge. Moss and his companions had stopped there shortly after 8:00 P.M. to purchase some beer in a tavern at the marina. Moss had never owned a boat prior to August 17, 1968, and had no significant experience operating a boat. He had taken the new boat out on only one prior occasion, on August 18, the day before the accident, and had been through the Indiana Avenue Bridge on one round trip. The boat contained no life preservers or buoyant apparatus of any kind.

Moss and Steglich remained in the boat while O’Malley, Regan and O’Donnell went up to the tavern at Seaways Marina. When the three young men returned some time later, Moss departed from the gas dock and proceeded toward the south draw of the bridge on a course roughly parallel to Indiana Avenue. Prior to the collision, a witness on the north shore near the marina observed the starboard and bow running lights of the barge as it began emerging from the draw of the bridge. The small boat collided with the front of the barge just as the latter was clearing the protective pile cluster at the northwest corner of the bridge draw. The occupants of the motorboat jumped out just prior to contact and all but O’Donnell reached safety.

The trial court found that Moss was guilty of a number of violations of the Rules of the Road for Western Rivers, 33 U.S.C. § 301 et seq., and the Pilot Rules for Western Rivers, 33 C.F.R. § 95.01 et seq. The court found that these violations eonstitituted gross fault in the aggregate and were sufficient in themselves to account for the collision. As to the conduct of the MARY R, the court found no violation of Rule 24(b) of the Rules of the Road, 33 U.S.C. § 349(b), which provides that when a vessel is approaching a blind bend and has a tow ahead of her, “[W]hen the head of such tow is within six hundred yards of the bend . . . [she] shall give a signal by three distinct blasts of her whistle.” It was further found that even if Toomey had been positioned in the most favorable possible place to observe approaching craft as the barge emerged from under the bridge, he could not have seen or warned Moss in time to prevent the collision.

In an admiralty case, as in the ordinary civil case under Rule 52(a) of the Federal Rules of Civil Procedure, the findings of the trial court may not be set aside unless they are clearly erroneous. Commercial Transport Corp. v. Martin Oil Service, Inc., 374 F.2d 813, 817 (7th Cir. 1967); In re Rapp’s Petition, 255 F.2d 628, 632 (7th Cir. 1958). Although appellants challenge a number of the court’s conclusions of law, the main thrust of their argument on appeal is that the evidence at trial did not support the court’s decision as a factual matter. We find nothing in this record to indicate clear error in the findings of the experienced trial judge who heard the evidence and observed the witnesses in this case.

An examination of the record shows that the pilings and center pier of the bridge effectively obstructed the view which a lookout stationed at the head of the barge would have had of the Moss boat until seconds before the collision. The precise amount of time can be estimated at somewhere from one to five seconds on the basis of evidence as to the location at which the collision occurred (five to twenty feet west of the northwest pile cluster) and the testimony of the occupants of the motorboat that they did not see the barge until two to five seconds before the collision. Under these circumstances, the finding that Toomey’s absence from the head of the barge was immaterial and could not have been a contributing cause of the collision is substantially supported by the evidence. Therefore, even if there was a breach of the duty to keep a proper lookout, the fact that a lookout could not have prevented the collision precludes a finding of liability on that basis. Tidewater Associated Oil Co. v. United States, 60 F.Supp. 376 (S.D.Calif.1945); The Bouker No. 2, 254 F. 579 (2d Cir. 1918); The Transfer No. 21, 248 F. 459 (5th Cir. 1918). Appellants contend that a failure to keep a proper lookout is a statutory fault which casts upon Schmidt the burden, under the rule of The Pennsylvania, 19 Wall. 125, 86 U.S. 125, 22 L.Ed. 148 (1874), of showing “not merely that her fault might not have been one of the causes, or that it probably was not, but that it could not have been.” See Ulster Oil Transport Corp. v. The Matton No. 20, 210 F.2d 106 (2d Cir. 1954); Gulf Oil Corp. v. The Socony No. 16, 162 F.2d 869 (2d Cir. 1947). Compare Anthony v. International Paper Company, 289 F.2d 574 (4th Cir. 1961). As indicated above, however, the court specifically found that such a showing had been made by stating that “[e]ven if a lookout were required on the starboard forward corner, he could not have seen or warned Moss in time to prevent the collision.”

Appellants attempt to attribute fault to the MARY R for not sounding a danger signal as required by Rule 24(a) of the Rules of the Road for Western Rivers, 33 U.S.C. § 349(a), or otherwise warning Moss prior to the collision. Rule 24(a) provides as follows:

If, when steam vessels are approaching each other either vessel for any reason fails to understand, or regards as unsafe, the course or intention of the other, the vessel in doubt shall immediately so signify by giving several short and rapid blasts of her whistle, at least four, the danger signal.

We agree with Schmidt that the rule applies only to those situations where a vessel is aware of “the course or intention of the other vessel”. In light of the inability of the MARY R to see the Moss boat until it was too late to avoid the collision, any warning would have been futile and the rule requiring a danger signal is inapplicable.

The trial court found that the MARY R did not violate Rule 24(b), 33 U.S.C. § 349(b), which requires a bend signal to be sounded “within 600 yards” of a blind bend in the river. The court interpreted the rule as not prescribing a minimum distance within which such a signal must be sounded and that the practice of the pilot of the MARY R to sound a bend signal as soon as he cleared the Indiana Avenue Bridge was “both reasonable and prudent”. It is unnecessary, however, to decide whether the trial court’s interpretation of the language “within 600 yards” was correct or whether, given that interpretation, the finding of reasonableness was erroneous. The court in its conclusions of law stated as follows:

There are many cases where the vessels failed to blow a bend signal at all and were found at fault for colliding with vessels rounding bends, but none of these eases is analogous, because this collision did not happen at a bend, and Moss was never around the bend at any time when the Mary R was within 600 yards of the bend. The law did not contemplate the sounding of a signal for the benefit of Moss, only for the benefit of vessels below the bend. (Emphasis supplied.)

We agree that the bend signal rule imposed no duty upon the MARY R with respect to Moss.

The question of the applicability of the bend signal rule to the facts of this case is controlled by principles recently stated by the Supreme Court in Union Oil Company of California v. The Tugboat San Jacinto, 409 U.S. 140, 93 S.Ct. 368, 34 L.Ed.2d 365 (1972). In that case, the SS SANTA MARIA and the tugboat SAN JACINTO were approaching on opposite sides of a well-defined and relatively narrow channel. Although the visibility in the direction in which the SANTA MARIA was headed was almost two miles, there was heavy fog to the left. The SAN JACINTO emerged from the fog bank only 900 feet away; executing a U-turn in front of the SANTA MARIA which caused a barge in the tow of the SAN JACINTO to crash into the bow of the SANTA MARIA. The Court of Appeals held that the SANTA MARIA violated Rule 16 of the Inland Rules of Navigation, 33 U.S.C. § 192, “the half-distance rule” which requires a vessel to travel in conditions of fog at a speed which will enable it to come to a standstill before it would collide with a vessel it could see through the fog. The Supreme Court reversed the judgment for half-damages against the SANTA MARIA which the Ninth Circuit had based on such statutory fault. The Court found implicit in the rule the assumption that vessels can reasonably be expected to be traveling on intersecting courses, and went on to state that:

“There is no evidence in the record suggesting that the speed of the tanker would have prevented her from coming to a complete halt within half the distance of sighting a vessel that was either proceeding on a remotely foreseeable intersecting course or else being overtaken by her. The tug emerged from a fog bank only 900 feet from the tanker on a course and for reasons that no seaman could, under the circumstances, have anticipated.” 93 S.Ct. at 372.

The Court held that “fault based on the half-distance rule must have some relationship to the dangers against which that rule was designed to protect”. Therefore, liability rested on the SAN JACINTO alone.

Likewise, in the instant case, fault based upon the bend signal rule must have some relationship to the dangers against which that rule was designed to protect. The rule clearly applies only to situations in which a steam vessel “is nearing a bend in a channel where, from the height of the banks or other cause, a steam vessel approaching from the other direction cannot be seen for a distance of six hundred yards. . . . ” 33 U.S.C. § 349(b). The rule was designed to protect against the danger of collision- between vessels whose vision of each other is obscured by a bend in the channel. There was no bend in the Little Calumet River which obscured the Moss boat from the view of the MARY R. The obstruction was the Indiana Avenue Bridge. Appellants do not contend that the bend signal rule should be interpreted to require such a signal six hundred yards from every obstruction to a full view of the channel ahead. They assert merely that the signal should have been sounded above the Indiana Avenue Bridge for the bend in the river some 400 yards downstream from the bridge. However, we cannot agree that the failure to timely sound such a signal to warn vessels on the other side of the bend results in fault for collisions with vessels hidden from view by a bridge which is fortuitously situated within 60 yards of the bend. If any duty is owed to approaching vessels which may be hidden by a bridge, the requirement of a signal should not be determined by whether there happens to be a bend in the river nearby. Therefore, the district court was correct in holding that the MARY R was not at fault for not sounding a bend signal before passing under the Indiana Avenue Bridge. Under Union Oil, supra, the collision between the Moss boat and the MARY R had no relationship to the dangers against which the bend signal rule was designed to protect.

Appellants urge that the MARY R should not he exonerated from liability-on the basis of the rule that “where the active fault of one vessel so flagrantly and heavily outweighs the passive faults of omission of the other vessel, the interests of justice are best served by condemning the more culpable vessel completely”. Cia. Maderas, etc. v. The Queenston Heights, 220 F.2d 120, 123 (5th Cir. 1955), cert. denied, 350 U.S. 824, 76 S.Ct. 52, 100 L.Ed. 736 (1955). Accepting appellants’ contention that such a rule, though well-established, must be carefully applied, we find that the evidence supports the trial court’s finding that the fault of Moss was “glaring” and was sufficient in itself to account for the collision. Discussion of the so-called “major-minor fault rule”, however, is unnecessary because there is ample evidence in the record to support the exoneration of Schmidt even under the strictest standards required by the rule of The Pennsylvania, supra. Since there was no fault on the part of the MARY R for not sounding a bend signal, Schmidt was not required to make a showing that such a fault could not have been a cause of the collision. The only remaining faults urged by appellants arise out of the alleged failure of the MARY R to keep a proper lookout. Although the trial court cited the Cia. Maderas case, supra, Judge Marovitz specifically found, on the basis of substantial evidence, that a properly stationed lookout “could not have seen or warned Moss in time to prevent the collision”. Thus, we need not consider whether the lookout was inadequate, or whether an inadequate lookout would constitute a “major” or “minor” fault. Further inquiry is foreclosed by the finding that no causal connection existed between any such fault and the collision. That finding, not being clearly erroneous, satisfies the strict requirements of The Pennsylvania.

The judgments appealed from are affirmed.

Affirmed.

        See also Note, The United States Courts of Appeals: 1971-1972 Term Criminal Law and Procedure, 61 Geo.L.J. 275, 379-81 (1972).