text:
    No. 833.
    Steinschreiber, doing business as Sidcaps Laboratories, et al. v. United States.

      Abraham S. Robinson, Alexander Dreiband and Herbert Alan Johnson for petitioners. Solicitor General Cox, Assistant Attorney General Miller, Beatrice Rosenberg and Jerome M. Feit for the United States.
   C. A. 2d Cir. Certiorari denied.


source: Caselaw Access Project

license: Public Domain

text:
    No. 829.
    Waller v. New Amsterdam Casualty Co.

      Charles B. Nye for petitioner.
   C. A. 4th Cir. Certiorari denied.


text:
    No. 831.
    Alger v. United States.

      William C. Erbecker for petitioner. Solicitor General Cox, Assistant Attorney General Miller, Beatrice Rosenberg and Julia P. Cooper for the United States.
   C. A. 7th Cir. Certiorari denied.


text:
    No. 841.
    Hoisting & Portable Engineers, Local Union No. 701, of the International Union of Operating Engineers, et al. v. Gilbert et al.

      Clifford D. O’Brien for petitioners.
   Supreme Court of Oregon. Certiorari denied.


text:
    No. 843.
    Nick v. State Highway Commission of Wisconsin.

      Elliot N. Walstead for petitioner. George Thompson, Attorney General of Wisconsin, Lyle E. Strahan, Deputy Attorney General, A. J. Feifarek, Assistant Attorney General, and George Brunner Schwahn for respondent.
   Supreme Court of Wisconsin. Certiorari denied.


text:
    No. 857.
    Trost v. American Hawaiian Steamship Co.

      Harvey Gold-stein for petitioner. Gray Williams for respondent.
   C. A. 2d Cir. Certiorari denied.


text:
    No. 905.
    Anthony v. County of Los Angeles.

      Leonidas P. Econom for petitioner. Harold W. Kennedy for respondent.
   District Court of Appeal of California, Second Appellate District. Certiorari denied.


text:
    No. 725.
    No. 827.
    Pan American World Airways, Inc., v. United Brotherhood of Carpenters & Joiners of America, Local Union 1780, et al.; and United Brotherhood of Carpenters & Joiners of America, Local Union 1780, et al. v. Pan American World Airways, Inc.

      Jesse Freidin, Murray Gartner and Herbert Prashker for petitioner in No. 725. Louis Sherman, Joseph A. Sickles and Laurence J. Cohen for Building & Construction Trades Council et al.; and Roland C. Davis for Culinary Workers Union, Local 226, respondents in No. 725. Asher W. Schwartz and John F. O’Donnell for Transport Workers Union of America, AFL-CIO, as amicus curiae, in support of the petition in No. 725. Solicitor General Cox for the United States, as amicus curiae, in opposition in No. 725. Louis Sherman, Joseph A. Sickles and Laurence J. Cohen for petitioners in No. 827. Jesse Freidin and Herbert Prashker for respondent in No. 827.
   C. A. 9th Cir. Cer-tiorari denied.

Mr. Justice Douglas is of the opinion that certiorari should be granted.


text:
    No. 822.
    Gotthilf v. Sills et al.

      O. John Rogge for petitioner. Theodore Chamas for respondents.
   Appellate Division, Supreme Court of New York, First Judicial Department. Certiorari denied.

Mr. Justice Douglas is of the opinion that certiorari should be granted.


text:
    No. 754.
    United States v. Seals.

      Solicitor General Cox and Assistant Attorney General Miller for the United States. William E. Stewart, Jr. and Peter R. Celia, Jr. for respondent.
   Motion of the respondent for leave to proceed in forma pauperis granted. Petition for writ of certiorari to the United States Court of Appeals for the District of Columbia Circuit denied.


text:
    No. 857, Misc.
    Twining v. United States.

      Solicitor General Cox, Assistant Attorney General Miller, Beatrice Rosenberg and Ronald L. Gainer for the United States.
   C. A. 5th Cir. Certiorari denied. Thomas C. Wicker, Jr. for petitioner.


text:
    No. 895, Misc.
    Wuckich v. New York.
   Court of Appeals of New York. Certiorari denied.


text:
    No. 896, Misc.
    Johnson v. Dowd, Warden.
   Supreme Court of Indiana. Certiorari denied.


text:
    No. 911, Misc.
    Johnson v. Murphy, Warden.
    Petitioner pro se. Louis J. Lefkowitz, Attorney General of New York, Samuel A. Hirshowitz?. First Assistant Attorney General, and Barry Mahoney, Deputy Assistant Attorney General, for respondent. ‘
   C. A. 2d Cir. Certiorari denied.


text:
    No. 1034, Misc.
    Mastrian v. Hedman, Sheriff, et al.

      Douglas W. Thomson and John A. Cochrane for petitioner.
   C. A. 8th Cir. Certiorari denied.


text:
    No. 1040, Misc.
    Caldera v. Eyman, Warden, et al.
   Supreme Court of Arizona. Certiorari denied.


text:
    No. 1042, Misc.
    Williams v. Wilkins, Warden.
   C. A. 2d Cir. Certiorari denied.


text:
    No. 1067, Misc.
    Rogers v. Russell, Correctional Superintendent.
   Supreme Court of Pennsylvania. Certiorari denied.


text:
    No. 1068, Misc.
    Camplain v. Oklahoma et al.
   Court of Criminal Appeals of Oklahoma. Certiorari denied.


text:
    No. 1075, Misc.
    Vinson v. Boles, Warden.
   Supreme Court of Appeals of West Virginia. Certiorari denied.


text:
    No. 1079, Misc.
    Hart v. Boles, Warden.
   Supreme Court of Appeals of West Virginia. Certiorari denied.


text:
    No. 1083, Misc.
    Bush v. Illinois.
   Supreme Court of Illinois. Certiorari denied.


text:
    No. 1129, Misc.
    Callahan v. New York.
    tioner.
   Appellate


text:
    No. 2, Misc.
    Simon v. Maroney, Warden, et al.

      Marjorie Hanson Matson and Rowland Watts for petitioner.
   Supreme Court of Pennsylvania. Certiorari denied.

Mr. Justice Douglas is of the opinion that certiorari should be granted.


text:
    No. 53.
    No. 612.
    No. 705.
    No. 730.
    Brooks v. Missouri Pacific Railroad Co., Addison et al. v. United States, Whaley v. United States, Wisconsin & Michigan Steamship Co. v. Corporation and Securities Commission,
   ante, p. 182;

ante, p. 905;

ante, p. 911; and

ante, p. 912. Petitions for rehearing denied.


text:
    No. 624, Misc.
    No. 818, Misc.
    No. 868, Misc.
    No. 902, Misc.
    No. 941, Misc.
    Standley v. United States, Franco v. United States, Magee et al. v. California, Dandy v. Myers, Correctional Superintendent, Karl v. Richardson, Warden,
   ante, p. 917;

ante, p. 903;

ante, p. 925;

ante, p. 926; and

ante, p. 903. Petitions for rehearing denied.


text:
    March 31, 1964.
    No. 745.
    Giant Food Inc. v. Federal Trade Commission.

      Raymond R. Dickey and Bernard Gordon for petitioner. Solicitor General Cox for respondent.
   On petition for writ of certiorari to the United States Court of Appeals for the District of Columbia Circuit. Dismissed pursuant to Rule 60 of the Rules of this Court.


text:
    April 6, 1964.
    No. 39.
    No. 40.
    New York Times Co. v. Sullivan; and Abernathy et al. v. Sullivan,

      Sam Rice Baker, M. Roland Nachman, Jr. and Calvin Whitesell on the motion. Herbert Wechsler for New York Times Co., in opposition.
   ante, p. 254. The motion of respondent for the apportionment of printing costs and fees is denied.


text:
    No. 1041, Misc.
    Copeland v. Secretary of State.

      Leonard B. Boudin on the motion.
   On appeal from the United States District Court for the Southern District of New York. The motion of the appellant to advance is denied.


text:
    Nos. 379 and 380.
    Pan-American Life Insurance Co. v. Lorido.
   On petitions for writs of certiorari to the Supreme Court of Florida and the District Court of Appeal of Florida, Third District. The Solicitor General is invited to file a brief expressing the views of the United States.


text:
    No. 481.
    Viking Theatre Corp. v. Paramount Film Distributing Corp. et al.
   Certiorari, 375 U. S. 939, to


text:
    No. 1138, Misc.
    No. 1171, Misc.
    Creagh v. Maxwell, Warden, et al.; and Scarbeck v. Anderson, Jail Superintendent.
   Motions for leave to file petitions for writs of habeas corpus denied.


text:
    No. 1168, Misc.
    Meachnor v. Eyman, Warden, et al.
   Motion for leave to file petition for writ of habeas corpus denied. Treating the papers submitted as a petition for writ of certiorari, certiorari is denied.


text:
    No. 912, Misc.
    Springfield v. Surgeon General of the United States.

      General Cox, Assistant Attorney General Marshall, Harold H. Greene and David Rubin for respondent.
   Motion for leave to file petition for


text:
    No. 1013, Misc.
    Sharp v. United States Court of Appeals for the Sixth Circuit et al.
   Motion for leave to file petition for writ of mandamus denied.


text:
    No. 731.
    Gianopulos v. Illinois.
    Petitioner pro se. Daniel P. Ward and Elmer C. Kissane for respondent.
   Criminal Court of Cook County, Illinois. Certiorari denied.


text:
    No. 830.
    Stevens Bros. Foundation, Inc., v. Commissioner of Internal Revenue.

      John M. Sullivan for petitioner. Solicitor General Cox, Assistant Attorney General Oberdorfer and Gilbert E. Andrews for respondent.
   C. A. 8th Cir. Cer-tiorari denied.


text:
    No. 847.
    Boyajian, doing business as Precision Testing Laboratories, v. Old Colony Envelope Co., Inc., et al.
    Petitioner pro se. Eben M. Graves for respondents.
   C. A. 1st Cir. Certiorari denied.


text:
    No. 852.
    Lamar, Executrix, v. Bookwalter, District Director of Internal Revenue.

      James J. Waters for petitioner. Solicitor General Cox, Assistant Attorney General Ober-dorfer, Robert N. Anderson and Benjamin M. Parker for respondent.
   C. A. 8th Cir. Certiorari denied.


text:
    No. 860.
    Des Plaines Currency Exchange, Inc., v. Knight, Director of Financial Institutions, et al.

      Edward M. White for petitioner. Leonard D. Rutstein for respondent Kane.
   Supreme Court of Illinois. Certiorari denied.


text:
    No. 856.
    Brown et ux. v. Pearl River Valley Water Supply District.

      James P. Coleman for petitioners. L. Arnold Pyle for respondent.
   Supreme Court of Mississippi. Certiorari denied.


text:
    No. 859.
    Isthmian Lines, Inc., et al. v. Ballwanz, to the use of Liberty Mutual Insurance Co.

      William A. Grimes and Eugene A. Edgett, Jr. for petitioners. John J. O’Connor, Jr. for respondent.
   C. A. 4th Cir. Certiorari denied.


text:
    No. 864.
    Williams et al. v. United States.

      Kenneth D. Wood, William H. Collins and James K. Hughes for petitioners. Solicitor General Cox, Assistant Attorney General Miller, Beatrice Rosenberg and Robert G. Maysack for the United States.
   United States Court of Appeals for the District of Columbia Circuit. Certiorari denied.


text:
    No. 865.
    Brown et al. v. Unauthorized Practice of Law Committee of Cuyahoga County, Ohio.

      Alexander H. Martin, Jr. for petitioners. Merritt W. Green for respondent.
   Supreme Court of Ohio. Certiorari denied.


text:
    No. 880.
    Aiple, doing business as Aiple Towing Co., v. Central Soya Co., Inc.

      John M. O’Connor, Jr. for petitioner. Stuart B. Bradley for respondent.
   C. A. 7th Cir. Certio-rari denied.


text:
    No. 821, Misc.
    Massengale v. Massengale.
   Court of Common Pleas of Ohio, Hamilton County. Certiorari denied.


text:
    No. 893.
    United Mine Workers of America v. Love & Amos Coal Co.

      E. H. Rayson, R. R. Kramer and Harrison Combs for petitioner. J. Clarence Evans and John A. Rowntree for respondent.
   Court of Appeals of Tennessee. Cer-tiorari denied.


text:
    No. 660.
    Seattle Building & Construction Trades Council et al. v. Rosling et al.

      Hugh Hafer and Richard P. Donaldson for petitioners. De-Witt Williams for . respondents.
   Supreme Court of Washington. Certiorari denied.

Mr. Justice Douglas is of the opinion that certiorari should be granted.


text:
    No. 818.
    Timken Roller Bearing Co. v. National Labor Relations Board.

      John G. Ketterer for petitioner. Solicitor General Cox, Arnold Ordman, Dominick L. Manoli and Norton J. Come for respondent.
   C. A. 6th Cir. Certiorari denied.

Mr. Justice Goldberg took no part in the consideration or decision of this petition.


text:
    No. 848.
    Michalsky v. City of New York.
   Motion to dispense with printing the petition for writ of certiorari granted. Petition for writ of certiorari to the United States Court of Appeals for the Second Circuit denied.


text:
    No. 788, Misc.
    Gosnell v. Boles, Warden.
    Petitioner pro se. C. Donald Robertson, Attorney General of West Virginia, and C. Robert Sarver, Assistant Attorney General, for-respondent.
   Supreme Court of Appeals of West Virginia. Certiorari denied.


text:
    No. 841, Misc.
    Jacobs v. Warden, Maryland Penitentiary.
   Circuit Court for Baltimore County, Maryland. Certiorari denied.


text:
    No. 845, Misc.
    Hutchinson v. North Carolina.
    Petitioner pro se. Thomas Wade Bruton, Attorney General of North Carolina, and Ralph Moody, Deputy Attorney General, for respondent.
   Supreme Court of North Carolina. Certiorari denied.


text:
    No. 907, Misc.
    Paige v. North Carolina.
    Petitioner pro se. Thomas Wade Bruton, Attorney General of North Carolina, and Ralph Moody, Deputy Attorney General, for respondent.
   Supreme Court of North Carolina. Certiorari denied.


text:
    No. 932, Misc.
    Walker v. Pate, Warden.
    Petitioner pro se. William G. Clark, Attorney General of Illinois, and Edward A. Berman, Assistant Attorney General, for respondent.
   C. A. 7th Cir. Certiorari denied.


text:
    No. 943, Misc.
    Baber v. United States.
    Petitioner pro se. Solicitor General Cox, Assistant Attorney General Miller, Beatrice Rosenberg and Jerome M. Feit for the United States.
   United States Court of Appeals for the District of Columbia Circuit. Certiorari denied.


text:
    No. 1054, Misc.
    Keitt v. New York.

      Nanette Dembitz for petitioner. Frank S. Hogan and H. Richard Uviller for respondent.
   Appellate Division, Supreme Court of New York, First Judicial Department. Certiorari denied.


text:
    No. 1066, Misc.
    Brown v. New York.
   Court of Appeals of New York. Certiorari denied.


text:
    No. 1074, Misc.
    Hayes v. Cunningham, Penitentiary Superintendent.

      Lewis T. Booker for petitioner.
   Supreme Court of Appeals of Virginia. Certiorari denied.


text:
    No. 764, Misc.

      Ogden v. United States.

      Daniel G. Marshall for petitioner. Solicitor General Cox, Assistant Attorney General Yeagley and Kevin T. Maroney for the United States.
   C. A. 9th Cir. Certiorari denied.

Mr. Justice Douglas is of the opinion that certiorari should be granted.


text:
    No. 878, Misc.
    Durr v. Illinois.
   Supreme Court of Illinois. Certiorari denied.

Mr. Justice Douglas is of the opinion that certiorari should be granted.


text:
    No. 79.
    No. 108.
    No. 680.
    No. 756.
    No. 769.
    No. 773.
    2,872.88 Acres of Land et al. v. United States, Sears, Roebuck & Co. v. Stiffel Company, Wolfsohn, Executrix, v. Hankin et al., Badger v. United States, Rodgers v. Baltimore & Ohio Railroad Co., General Radio Co. v. Superior Electric Co.,
   ante, p. 192;

ante, p. 225;

ante, p. 203;

ante, p. 914;

ante, p. 932; and

ante, p. 938. Petitions for rehearing denied.


text:
    No. 216.
    No. 234.
    In re Estate of Williams, Ginsburg v. Stern et al.,
   ante, p. 902; and

ante, p. 930. Petitions for rehearing sur motion for docketing and submission of petitioner’s motion to remand denied.


text:
    No. 698, Misc.
    No. 920, Misc.
    Fermin v. Municipal Court Department No. 3, Oakland, California, Brill v. Muller Brothers, Inc.,
   375 U. S. 925; and

ante, p. 927. Motions for leave to file petitions for rehearing denied.


author:
Mr. Justice Black
      MR. Justice Clark,

text:
    BROTHERHOOD OF RAILROAD TRAINMEN v. VIRGINIA ex rel. VIRGINIA STATE BAR.
    No. 34.
    Argued January 13, 1964.
    Decided April 20, 1964.

      Beecher E. Stallard and John J. Naughton argued the cause for petitioner. With them on the briefs were Edward B. Henslee and Arnold Elkind.

      Aubrey R. Bowles, Jr. argued the cause for respondent. With him on the brief was Aubrey R. Bowles III.

      Wayland B. Cedarquist, Holcombe H. Perry, Warren H. Resh and Earl Sneed filed a brief for the American Bar Association, as amicus curiae, urging affirmance.
   Mr. Justice Black

delivered the opinion of the Court.

The Virginia State Bar brought this suit in the Chancery Court of the City of Richmond, Virginia, against the Brotherhood of Railroad Trainmen, an investigator employed by the Brotherhood, and an attorney designated its “Regional Counsel,” to enjoin them from carrying on activities which, the Bar charged, constituted the solicitation of legal business and the unauthorized practice of law in Virginia. It was conceded that in order to assist the prosecution of claims by injured railroad workers or by the families of workers killed on the job the Brotherhood maintains in Virginia and throughout the country a Department of Legal Counsel which recommends to Brotherhood members and their families the names of lawyers whom the Brotherhood believes to be honest and competent. Finding that the Brotherhood’s plan resulted in “channeling all, or substantially all,” the workers’ claims to lawyers chosen by the Department of Legal Counsel, the court issued an injunction against the Brotherhood’s carrying out its plan in Virginia. The Supreme Court of Appeals of Virginia affirmed summarily over objections that the injunction abridges the Brotherhood’s rights under the First and Fourteenth Amendments, which guarantee freedom of speech, petition and assembly. We granted certiorari to consider this constitutional question in the light of our recent decision in NAACP v. Button, 371 U. S. 415. 372 U. S. 905.

The Brotherhood’s plan is not a new one. Its roots go back to 1883, when the Brotherhood was founded as a fraternal and mutual benefit society to promote the welfare of the trainmen and “to protect their families by the exercise of benevolence, very needful in a calling so hazardous as ours . ...” Railroad work at that time was indeed dangerous. In 1888 the odds against a railroad brakeman’s dying a natural death were almost four to one; the average life expectancy of a switchman in 1893 was seven years. It was quite natural, therefore, that railroad workers combined their strength and efforts in the Brotherhood in order to provide insurance and financial assistance to sick and injured members and to seek safer working conditions. The Trainmen and other railroad Brotherhoods were the moving forces that brought about the passage of the Safety Appliance Act in 1893 to make railroad work less dangerous; they also supported passage of the Federal Employers’ Liability Act of 1908 to provide for recovery of damages for injured railroad workers and their families by doing away with harsh and technical common-law rules which sometimes made recovery difficult or even impossible. It soon became apparent to the railroad workers, however, that simply having these federal statutes on the books was not enough to assure that the workers would receive the full benefit of the compensatory damages Congress intended they should have. Injured workers or their families often fell prey on the one hand to persuasive claims adjusters eager to gain a quick and cheap settlement for their railroad employers, or on the other to lawyers either not competent to try these lawsuits against the able and experienced railroad counsel or too willing to settle a case for a quick dollar.

It was to protect against these obvious hazards to the injured man or his widow that the workers through their Brotherhood set up their Legal Aid Department, since renamed Department of Legal Counsel, the basic activities of which the court below has enjoined. Under their plan the United States was divided into sixteen regions and the Brotherhood selected, on the advice of local lawyers and federal and state judges, a lawyer or film in each region with a reputation for honesty and skill in representing plaintiffs in railroad personal injury litigation. When a worker was injured or killed, the secretary of his local lodge would go to him or to his widow or children and recommend that the claim not be settled without first seeing a lawyer, and that in the Brotherhood’s judgment the best lawyer to consult was the counsel selected by it for that area.

There is a dispute between the parties as to the exact meaning of the decree rendered below, but the Brotherhood in this Court objects specifically to the provisions which enjoin it

“. . . from holding out lawyers selected by it as the only approved lawyers to aid the members or their families; ... or in any other manner soliciting or encouraging such legal employment of the selected lawyers; . . . and from doing any act or combination of acts, and from formulating and putting into practice any plan, pattern or design, the result of which is to channel legal employment to any particular lawyer or group of lawyers . ...”

The Brotherhood admits that it advises injured members and their dependents to obtain legal advice before making settlement of their claims and that it recommends particular attorneys to handle such claims. The result of the plan, the Brotherhood admits, is to channel legal employment to the particular lawyers approved by the Brotherhood as legally and morally competent to handle injury claims for members and their families. It is the injunction against this particular practice which the Brotherhood, on behalf of its members, contends denies them rights guaranteed by the First and Fourteenth Amendments. We agree with this contention.

It cannot be seriously doubted that the First Amendment’s guarantees of free speech, petition and assembly give railroad workers the right to gather together for the lawful purpose of helping and advising one another in asserting the rights Congress gave them in the Safety Appliance Act and the Federal Employers’ Liability Act, statutory rights which would be vain and futile if the workers could not talk together freely as to the best course to follow. The right of members to consult with each other in a fraternal organization necessarily includes the right to select a spokesman from their number who could be expected to give the wisest counsel. That is the role played by the members who carry out the legal aid program. And the right of the workers personally or through a special department of their Brotherhood to advise concerning the need for legal assistance — and, most importantly, what lawyer a member could confidently rely on — is an inseparable part of this constitutionally guaranteed right to assist and advise each other.

Virginia undoubtedly has broad powers to regulate the practice of law within its borders; but we have had occasion in the past to recognize that in regulating the practice of law a State cannot ignore the rights of individuals secured by the Constitution. For as we said in NAACP v. Button, supra, 371 U. S., at 429, “a State cannot foreclose the exercise of constitutional rights by mere labels.” Here what Virginia has sought to halt is not a commercialization of the legal profession which might threaten the moral and ethical fabric of the administration of justice. It is not “ambulance chasing.” The railroad workers, by recommending competent lawyers to each other, obviously are not themselves engaging in the practice of law, nor are they or the lawyers whom they select parties to any soliciting of business. It is interesting to note that in Great Britain unions do not simply recommend lawyers to members in need of advice; they retain counsel, paid by the union, to represent members in personal lawsuits, a practice similar to that which we upheld in NAACP v. Button, supra.

A State could not, by invoking the power to regulate the professional conduct of attorneys, infringe in any way the right of individuals and the public to be fairly represented in lawsuits authorized by Congress to effectuate a basic public interest. Laymen cannot be expected to know how to protect their rights when dealing with practiced and carefully counseled adversaries, cf. Gideon v. Wainwright, 372 U. S. 335, and for them to associate together to help one another to preserve and enforce rights granted them under federal laws cannot be condemned as a threat to legal ethics. The State can no more keep these workers from using their cooperative plan to advise one another than it could use more direct means to bar them from resorting to the courts to vindicate their legal rights. The right to petition the courts cannot be so handicapped.

Only last Term we had occasion to consider an earlier attempt by Virginia to enjoin the National Association for the Advancement of Colored People from advising prospective litigants to seek the assistance of particular attorneys. In fact, in that case, unlike this-one, the attorneys were actually employed by the 'association which recommended them, and recommendations were made even to nonmembers. NAACP v. Button, supra. We held that “although the petitioner has amply shown that its activities fall within the First Amendment’s protections, the State has failed to advance any substantial regulatory interest, in the form of substantive evils flowing from petitioner’s activities, which can justify the broad prohibitions which it has imposed.” 371 U. S., at 444. In the present case the State again has failed to show any appreciable public interest in preventing the Brotherhood from carrying out its plan to recommend the lawyers it selects to represent injured workers. The Brotherhood’s activities fall just as clearly within the protection of the First Amendment. And the Constitution protects the associational rights of the members of the union precisely as it does those of the NAACP.

We hold that the First and Fourteenth Amendments protect the right of the members through their Brotherhood to maintain and carry out their plan for advising workers who are injured to obtain legal advice and for recommending specific lawyers. Since the part of the decree to which the Brotherhood objects infringes those rights, it cannot stand; and to the extent any other part of the decree forbids these activities it too must fall. And, of course, lawyers accepting employment under this constitutionally protected plan have a like protection which the State cannot abridge.

The judgment and decree are vacated and the case is remanded ■ for proceedings not inconsistent with this opinion.

It is so ordered.

Mr. Justice Stewart took no part in the disposition of this case.

MR. Justice Clark,

whom Mr. Justice Harlan joins,

dissenting.

By its decision today the Court overthrows state regulation of the legal profession and relegates the practice of law to the level of a commercial enterprise. The Court permits a labor union — contrary to state law — to engage in the unauthorized practice of soliciting personal injury cases from among its membership on behalf of 16 regional attorneys whom its president has placed on the union’s approved list. Local officials of the union call on each member suffering an injury and seek to secure employment of these approved attorneys in the prosecution of claims for damages arising therefrom. Moreover the union, through its president, not only controls the appointment and dismissal of the approved attorney but also has considerable influence over his fees and often controls the disposition of cases. Furthermore, from 1930 to at least 1959, the union had required these approved attorneys to pay to it a portion of their fees, usually 25%. Such an arrangement may even now be in effect through the ruse of reimbursement for investigatory services rendered by the union. This state of affairs degrades the profession, proselytes the approved attorneys to certain required attitudes and contravenes both the accepted ethics of the profession and the statutory and judicial rules of acceptable conduct.

The Court excuses the practice on the policy ground that the union membership needs a corps of attorneys experienced in personal injury litigation because ordinary “lawyers [are] either not competent to try these lawsuits against the able and experienced railroad counsel or too willing to settle a case for a quick dollar.” To me this is a serious indictment of the profession. In the cases that I have passed on here — numbering about 177 during the past 15 years — I dare say that counsel for the railroad employee has exhibited advocacy not inferior to that of his opponent (although I do not remember that any one of the 16 approved attorneys appeared in these cases). Indeed, the railroad employee has prevailed in practically all of the cases and the recoveries have ranged as high as $625,000. See Gallick v. Baltimore & Ohio R. Co., 372 U. S. 108 (1963); Transcript of Record, p. 7. Under these facts the Court’s rationale will not stand up, even as a policy ground for approving this patent violation of the cardinal ethics of our profession and flagrant disobedience to the law of most of our States.

The Court depends upon NAACP v. Button, 371 U. S. 415 (1963), to support its position. But there the vital fact was that the claimed privilege was a “form of political expression” to secure, through court action, constitutionally protected civil rights. Personal injury litigation is not a form of political expression, but rather a procedure for the settlement of damage claims. No guaranteed civil right is involved. Here, the question involves solely the regulation of the profession, a power long recognized as belonging peculiarly to the State. Button, as well as its ancestry cited by the majority in the footnotes, is not apposite.

Finally, no substantive evil would result from the activity permitted in Button. But here the past history of the union indicates the contrary. Its Legal Aid Department (now the Department of Legal Counsel) was set up in 1930 for the admitted purposes of advising members “relative to their rights respecting claims for damages” and assisting them “in negotiating settlements . . . .” The Department had a complete reporting service on all major injuries or deaths suffered by its members, regional investigators to whom such reports were referred, and the 16 approved regional counsel (many of whom remain the same today) to whom the cases were channeled for prosecution and who split their fees with the union. And, what is of even more significance, the trial court in this case found “that the defendant Brotherhood still adheres to the pattern and design of the plan formulated and implemented in 1930.”

The union admits that it did operate in this manner until 1959 but says that it has now reformed its operation. But the record shows that this identical union plan has been before several other courts and, while the union has repeatedly promised to reform, as here, it has consistently renewed the same practices. But even if the union has sincerely reformed, which I doubt, the plan it now proposes to follow is subject to the same deficiencies. It includes: the approval of 16 regional attorneys by the president of the union, who also has power to discharge them at his pleasure; the solicitation of all injured members by the local officials of the Brotherhood who urge the employment of an approved counsel; the furnishing of the name of the approved counsel to the injured brother as the only attorney approved by the Brotherhood; the furnishing of the names and addresses of injured members to the approved attorneys; the furnishing of investigative services to the approved attorney, the cost of which, it is indicated, comes from the fees received by the latter; and, finally, the “tooting” of the approved attorneys in union literature and meetings.

I do not read the decree approved by the State as prohibiting union members from recommending an attorney to their brothers in the union. Virginia has sought only to halt the gross abuses of channeling and soliciting litigation which have been going on here for 30 years. The potential for evil in the union’s system is enormous and, in my view, will bring disrepute to the legal profession. The system must also work to the disadvantage of the Brotherhood members by directing their claims into the hands of the 16 approved attorneys who are subject to the control of one man, the president of the union. Finally, it will encourage further departures from the high standards set by canons of ethics as well as by state regulatory procedures and will be a green light to other groups who for years have attempted to engage in similar practices. E. g., Chicago Bar Assn. v. Chicago Motor Club, 362 Ill. 50, 199 N. E. 1; Rhode Island Bar Assn. v. Automobile Service Assn., 55 R. I. 122, 179 A. 139; cf. Semler v. Oregon State Board of Dental Examiners, 294 U. S. 608 (1935); Williamson v. Lee Optical of Oklahoma, Inc., 348 U. S. 483 (1955).

       The investigator and the Regional Counsel were not served with process and are not parties.

       We do not find it necessary to consider the Brotherhood’s additional argument that the decree violates the Brotherhood’s right to represent workers which is guaranteed by the Railway Labor Act, 44 Stat. 577, as amended, 45 U. S. C. §§ 151-188.

       Constitution of the Brotherhood of Railroad Trainmen and Brotherhood of Railroad Trainmen Insurance Department, Preamble.

       Interstate Commerce Commission, Third Annual Report (1889), 85.

       Griffith, “The Vindication of a National Public Policy Under the Federal Employers’ Liability Act,” 18 Law and Contemp. Prob. 160, 163.

       27 Stat. 531, as amended, 45 U. S. C. §§ 1-43.

       35 Stat. 65, as amended, 45 U. S. C. §§ 51-60. An earlier version of the law passed two years earlier, 34 Stat. 232, had been held unconstitutional. Employers’ Liability Cases, 207 U. S. 463. The constitutionality of the 1908 statute was sustained in the Second Employers’ Liability Cases, 223 U. S. 1.

       The Brotherhood also provides a staff, now at its own expense, to investigate accidents to help gather evidence for use by the injured worker or his family should a trial be necessary to vindicate their rights.

       Certain other provisions of the decree enjoin the Brotherhood from sharing counsel fees with lawyers whom it recommended and from countenancing the sharing of fees by its regional investigators. The Brotherhood denies that it has engaged in such practices since 1959, in compliance with a decree of-the Supreme Court of Illinois. See In re Brotherhood of Railroad Trainmen, 13 Ill. 2d 391, 150 N. E. 2d 163. Since the Brotherhood is not objecting to the other provisions of the decree except insofar as they might later be construed as barring the Brotherhood from helping injured workers or their families by recommending that they not settle without a lawyer and by recommending certain lawyers selected by the Brotherhood, it is only to that extent that we pass upon the validity of the other provisions. Because of our disposition of the case, we do not consider the Brotherhood’s claim that the findings of the court were not supported by substantial evidence.

       The Bar relies on the common law, the Canons of Ethics of the American Bar Association, adopted into the rules of the Supreme Court of Appeals of Virginia, 171 Va. xviii, and several Virginia statutes prohibiting the unauthorized practice of law. The Canons of Ethics to which the Bar refers prohibit respectively stirring up of litigation, control or exploitation by a lay agency of professional services of a lawyer, and aiding the unauthorized practice of law. Canons 28, 35, 47. The statutes respectively set the qualifications for the practice of law in the State and provide for injunctions against “running, capping, soliciting and maintenance.” Virginia Code, 1950, §§ 54r-42, 54-83.1.

        NAACP v. Button, 371 U. S. 415; Konigsberg v. State Bar, 353 U. S. 252; Schware v. Board of Bar Examiners, 353 U. S. 232.

       See Feather, The Essence of Trade Unionism (London, 1963), 42-43.

       Cf. Drinker, Legal Ethics (1953), 167; Hildebrand v. State Bar, 36 Cal. 2d 504, 515, 225 P. 2d 508, 514 (Carter, J., dissenting), 36 Cal. 2d, at 521, 225 P. 2d, at 518 (Traynor, J., dissenting).

       See also Gibson v. Florida Legislative Investigation Comm., 372 U. S. 539; Louisiana ex rel. Gremillion v. NAACP, 366 U. S. 293; Shelton v. Tucker, 364 U. S. 479; Bates v. City of Little Rock, 361 U. S. 516; NAACP v. Alabama ex rel. Patterson, 357 U. S. 449; Schneider v. State, 308 U. S. 147.

       “In the context of NAACP objectives, litigation is not a technique of resolving private differences; it is a means for achieving the lawful objectives of equality of treatment by all government, federal, state and local, for the members of the Negro community in this country. It is thus a form of political expression.” NAACP v. Button, supra, at 429.

        E. g., In're Petition of Committee on Rule 28 of the Cleveland Bar Assn., 15 Ohio L. Abs. 106 (1933); In re Brotherhood of Railroad Trainmen, 13 Ill. 2d 391, 150 N. E. 2d 163 (1958); In re O’Neill, 5 F. Supp. 465 (E. D. N. Y. 1933); Young v. Gulf M. & O. R. Co., No. 3957 (E. D. Mo. 1946); Reynolds v. Gulf M. O. & Texas Pac. R. Co., No. 772 (E. D. Tenn. 1946); North Carolina ex rel. McLean v. Hice, Superior Ct. of N. C., County of Buncombe (1948).


author: Mr. Justice Douglas Mb. Justice StewaRT, Mr. Justice Brennan and Mr. Justice Goldberg.

text:
    SIMPSON v. UNION OIL CO. OF CALIFORNIA.
    No. 87.
    Argued January 15—16, 1964.
    Decided April 20, 1964.

      Maxwell Keith argued the cause and filed briefs for petitioner.

      Moses Lasky argued the cause and filed a brief for respondent.
   Mr. Justice Douglas

delivered the opinion of the Court.

This is a suit for damages under § 4 of the Clayton Act, 38 Stat. 731, 15 U. S. C. § 15, for violation of §§ 1 and 2 of the Sherman Act, 26 Stat. 209, as amended, 50 Stat. 693, 15 U. S. C. §§ 1, 2. The complaint grows out of a so-called retail dealer “consignment” agreement which, it is alleged, Union Oil requires lessees of its retail outlets to sign, of which Simpson was one. The “consignment” agreement is for one year and thereafter until canceled, is terminable by either party at the end of any year and, by its terms, ceases upon any termination of the lease. The lease is also for one year; and it is alleged that it is used to police the retail prices charged by the consignees, renewals not being made if the conditions prescribed by the company are not met. The company, pursuant to the “consignment” agreement, sets the prices at which the retailer sells the gasoline. While “title” to the consigned gasoline “shall remain in Consignor until sold by Consignee,” and while the company pays all property taxes on all gasoline in possession of Simpson, he must carry personal liability and property damage insurance by reason of the “consigned” gasoline and is responsible for all losses of the “consigned” gasoline in his possession, save for specified acts of God. Simpson is compensated by a minimum commission and pays all the costs of operation in the familiar manner.

The retail price fixed by the company for the gasoline during the period in question was 29.9 cents per gallon; and Simpson, despite the company’s demand that he adhere to the authorized price, sold it at 27.9 cents, allegedly to meet a competitive price. Solely because Simpson sold gasoline below the fixed price, Union Oil refused to renew the lease; termination of the “consignment” agreement ensued; and this suit was filed. The terms of the lease and “consignment” agreement are not in dispute nor the method of their application in this case. The interstate character of Union Oil’s business is conceded, as is the extensive use by it of the lease-consignment agreement in eight western States.

After two pretrial hearings, the company moved for a summary judgment. Simpson moved for a partial summary judgment — that the consignment lease program is in violation of § § 1 and 2 of the Sherman Act. The District Court, concluding that “all the factual disputes” had been eliminated from the case, entertained the motions. The District Court granted the company’s motion and denied Simpson’s, holding as to the latter that he had not established a violation of the Sherman Act and, even assuming such a violation, that he had not suffered any actionable damage. The Court of Appeals affirmed. While it assumed that there were triable issues of law, it concluded that Simpson suffered no actionable wrong or damage, 311 F. 2d 764. The case is here on a writ of cer-tiorari. 373 U. S. 901.

We disagree with the Court of Appeals that there is no actionable wrong or damage if a Sherman Act violation is assumed. If the “consignment” agreement achieves resale price maintenance in violation of the Sherman Act, it and the lease are being used to injure interstate commerce by depriving independent dealers of the exercise of free judgment whether to become consignees at all, or remain consignees, and, in any event, to sell at competitive prices. The fact that a retailer can refuse to deal does not give the supplier immunity if the arrangement is one of those schemes condemned by the antitrust laws.

There is actionable wrong whenever the restraint of trade or monopolistic practice has an impact on the market ; and it matters not that the complainant may be only one merchant. See Klor’s v. Broadway-Hale Stores, 359 U. S. 207, 213; Radiant Burners v. Peoples Gas Co., 364 U. S. 656, 660. As we stated in Radovich v. National Football League, 352 U. S. 445, 453-454:

“Congress has, by legislative fiat, determined that such prohibited activities are injurious to the public and has provided sanctions allowing private enforcement of the antitrust laws by an aggrieved party. These laws protect the victims of the forbidden practices as well as the public.”

The fact that, on failure to renew a lease, another dealer takes Simpson’s place and renders the same service to the public is no more an answer here than it was in Poller v. Columbia Broadcasting System, 368 U. S. 464, 473. For Congress, not the oil distributor, is the arbiter of the public interest; and Congress has closely patrolled price fixing whether effected through resale price maintenance agreements or otherwise. The exclusive requirements contracts struck down in Standard Oil Co. v. United States, 337 U. S. 293, were not saved because dealers need not have agreed to them, but could have gone elsewhere. If that were a defense, a supplier could regiment thousands of otherwise competitive dealers in resale price maintenance programs merely by fear of nonrenewal of short-term leases.

We made clear in United States v. Parke, Davis & Co., 362 U. S. 29, that a supplier may not use coercion on its retail outlets to achieve resale price maintenance. We reiterate that view, adding that it matters not what the coercive device is. United States v. Colgate, 250 U. S. 300, as explained in Parke, Davis, 362 U. S., at 37, was a case where there was assumed to be no agreement to maintain retail prices. Here we have such an agreement; it is used coercively, and, it promises to be equally if not more effective in maintaining gasoline prices than were the Parke, Davis techniques in fixing monopoly prices on drugs.

Consignments perform an important function in trade and commerce, and their integrity has been recognized by many courts, including this one. See Ludvigh v. American Woolen Co., 231 U. S. 522. Yet consignments, though useful in allocating risks between the parties and determining their rights inter se, do not necessarily control the rights of others, whether they be creditors or sovereigns. Thus the device has been extensively regulated by the States. 22 Am. Jur., Factors, § 8; Hartford Indemnity Co. v. Illinois, 298 U. S. 155. Congress, too, has entered parts of the field, establishing by the Act of June 10, 1930, 46 Stat. 531, as amended, 7 U. S. C. § 499a et seg., a pervasive system of control over commission merchants dealing in perishable agricultural commodities.

One who sends a rug or a painting or other work of art to a merchant or a gallery for sale at a minimum price can, of course, hold the consignee to the bargain. A retail merchant may, indeed, have inventory on consignment, the terms of which bind the parties inter se. Yet the consignor does not always prevail over creditors in case of bankruptcy, where a recording statute or a “traders act” or a “sign statute” is in effect. 4 Collier, Bankruptcy (14th ed.), pp. 1090-1097, 1484-1486. The interests of the Government also frequently override agreements that private parties make. Here we have an antitrust policy expressed in Acts of Congress. Accordingly, a consignment, no matter how lawful it might be as a matter of private contract law, must give way before the federal antitrust policy. Thus a consignment is not allowed to be used as a cloak to avoid § 3 of the Clayton Act. See Standard Fashion Co. v. Magrane-Houston Co., 258 U. S. 346, 353-356; cf. Straus v. Victor Talking Mach. Co., 243 U. S. 490, 500-501. Nor does § 1 of the Sherman Act tolerate agreements for retail price maintenance. See United States v. Socony-Vacuum Oil Co., 310 U. S. 150, 221-222; United States v. Parke, Davis & Co., supra.

We are enlightened on present-day marketing methods by recent congressional investigations. In the automobile field the price is “the manufacturer’s suggested retail price,” not a price coercively exacted; nor do automobiles go on consignment; they are sold. Resale price maintenance of gasoline through the “consignment” device is increasing. The “consignment” device in the gasoline field is used for resale price maintenance. The theory and practice of gasoline price fixing in vogue under the “consignment” agreement has been well exposed by Congress. A Union Oil official in recent testimony before a House Committee on Small Business explained the price mechanism:

“Mr. Roosevelt. Who sets the price in your consignment station, dealer consignment station?
“Mr. Rath. We do.
“Mr. Roosevelt. You do?
“Mr. Rath. Yes. We do it on this basis: You see, he is paid a commission to sell these products for us. Now, we go out into the market area and find out what the competitive major price is, what that level is, and we set our house-brand price at that.”

Dealers, like Simpson, are independent businessmen; and they have all or most of the indicia of entrepreneurs, except for price fixing. The risk of loss of the gasoline is on them, apart from acts of God. Their return is affected by the rise and fall in the market price, their commissions declining as retail prices drop. Practically the only power they have to be wholly independent businessmen, whose service depends on their own initiative and enterprise, is taken from them by the proviso that they must sell their gasoline at prices fixed by Union Oil. By reason of the lease and “consignment” agreement dealers are coercively laced into an arrangement under which their supplier is able to impose noncompetitive prices on thousands of persons whose prices otherwise might be competitive. The evil of this resale price maintenance program, like that of the requirements contracts held illegal by Standard Oil Co. v. United States, supra, is its inexorable potentiality for and even certainty in destroying competition in retail sales of gasoline by these nominal “consignees” who are in reality small struggling competitors seeking retail gas customers.

As we have said, an owner of an article may send it to a dealer who may in turn undertake to sell it only at a price determined by the owner. There is nothing illegal about that arrangement. • When, however, a “consignment” device is used to cover a vast gasoline distribution system, fixing prices through many retail outlets, the antitrust laws prevent calling the “consignment” an agency, for then the end result of United States v. Socony- Vacuum Oil Co., supra, would be avoided merely by clever manipulation of words, not by differences in substance. The present, coercive “consignment” device, if successful against challenge under- the antitrust laws, furnishes a wooden formula for administering prices on a vast scale.

Reliance is placed on United States v. General Electric Co., 272 U. S. 476, where a consignment arrangement was utilized to market patented articles. Union Oil correctly argues that the consignment in that case somewhat parallels the one in the instant case. The Court in the General Electric case did not restrict its ruling to patented articles; it, indeed, said that the use of the consignment device was available to the owners of articles “patented or otherwise.” Id., at 488. But whatever may be said of the General Electric case on its special facts, involving patents, it is not apposite to the special facts here.

The Court in that case particularly relied on the fact that patent rights have long included licenses “to make, use and vend” the patented article “for any royalty or upon any condition the performance of which is reasonably within the reward which the patentee by the grant of the patent is entitled to secure.” Id., at 489. Congress in establishing the patent system included 35 U. S. C. § 154, which provides in part: “Every patent shall contain a short title of the invention and a grant to the patentee, his heirs or assigns, for the term of seventeen years, of the right to exclude others from, making, using, or selling the invention throughout the United States, referring to the specification for the particulars thereof.” (Italics added.)

“The right to manufacture, the right to sell, and the right to use are each substantive rights, and may be granted or conferred separately by the patentee.” Adams v. Burke, 17 Wall. 453, 456. Long prior to the General Electric case, price fixing in the marketing of patented articles had been condoned (Bement v. National Harrow Co., 186 U. S. 70), provided it did not extend to sales by purchasers of the patented articles. Adams v. Burke, supra; Ethyl Gasoline Corp. v. United States, 309 U. S. 436.

The patent laws which give a 17-year monopoly on “making, using, or selling the invention” are in pari materia with the antitrust laws and modify them pro tanto. That was the ratio decidendi of the General Electric case. See 272 U. S., at 485. We decline the invitation to extend it.

To allow Union Oil to achieve price fixing in this vast distribution system through this “consignment” device would be to make legality for antitrust purposes turn on clever draftsmanship. We refuse to let a matter so vital to a competitive system rest on such easy manipulation. Cf. United States v. Masonite Corp., 316 U. S. 265, 280.

Hence on the issue of resale price maintenance under the Sherman Act there is nothing left to try, for there was an agreement for resale price maintenance, coercively employed.

The case must be remanded for a hearing on all the other issues in the case, including those raised under the McGuire Act, 66 Stat. 631,15 U. S. C. § 45, and the damages, if any, suffered. We intimate no views on any other issue; we hold only that resale price maintenance through the present, coercive type of “consignment” agreement is illegal under the antitrust laws, and that petitioner suffered actionable wrong or damage. We reserve the question whether, when all the facts are known, there may be any equities that would warrant only prospective application in damage suits of the rule governing price fixing by the “consignment” device which we announce today.

Reversed and remanded.

Me. Justice Harlan took no part in the disposition of this case.

Mb. Justice StewaRT,

dissenting.

In this case the District Court granted a summary judgment in favor of the respondent, finding that the respondent had not violated the Sherman Act, and that even if there had been a violation, the petitioner had not suffered any damages. The Court of Appeals affirmed upon the theory that, even assuming a Sherman Act violation, “any damage occurring to Simpson was the result of his own free and deliberate choice and he could not deliberately and knowingly enter into contractual obligations and then and thereafter contend he was injured by the results of his own acts.” 311 F. 2d 764, at 769.

I think the reasoning upon which the Court of Appeals proceeded is untenable. The gravamen of the petitioner’s complaint was that he had been coerced into a lease conditioned upon acceptance of the respondent’s allegedly unlawful system of selling. If, as the Court of Appeals assumed, there had been such a violation of the Sherman Act, it was inconsistent to assume that the petitioner could not have been subject to the coercion he alleged and could not have suffered damages. But the root error in this case, it seems to me, was the District Court’s decision to terminate the controversy by way of a summary judgment. I therefore agree with the Court that the judgment of the Court of Appeals should be set aside and the case remanded to the District Court for a trial on the merits. Poller v. Columbia Broadcasting System, 368 U. S. 464. But I think that upon remand there should be a full trial of all the issues in this litigation, because I completely disagree with the Court that whenever a bona fide consignor, employing numerous agents, sets the price at which his property is to be sold, “the antitrust laws prevent calling the 'consignment’ an agency,” and transform the consignment into a sale. In the present posture of this case, such a determination, overruling as it does a doctrine which has stood unquestioned for almost 40 years, is unwarranted, unnecessary and premature.

In United States v. General Electric, 272 U. S. 476, this Court held that a bona fide consignment agreement of this kind does not violate the Sherman Act. The Court today concedes that “the consignment in that case somewhat parallels the one in the instant case.” The fact of the matter is, so far as the record now before us discloses, the two agreements are virtually indistinguishable. Instead of expressly overruling General Electric, however, the Court seeks to distinguish that case upon the specious ground that its underpinnings rest on patent law.

It is, of course, true that what was sold in General Electric was not gasoline, but lamp bulbs which had been manufactured under a patent. But until today no one has ever considered this fact relevant to the holding in that case that bona fide consignment agreements do not violate the antitrust laws “however comprehensive as a mass or whole in their effect . . . Id., at 488. In addition to the unambiguous statement in Chief Justice Taft’s opinion for a unanimous Court that “[t]he owner of an article, patented or otherwise, is not violating the common law, or the Anti-Trust law, by seeking to dispose of his article directly to the consumer and fixing the price by which his agents transfer the title from him directly to such consumer,” 272 U. S., at 488, the Court, throughout that portion of its opinion dealing with the validity of General Electric’s consignment agreements, gave no intimation whatsoever that its conclusion would have differed in any respect if the consigned article had been unpatented. Quite the contrary, the General Electric Court, assessing the validity of these agreements, addressed itself to but one question: “The question is whether, in view of the arrangements, made by the company with those who ordinarily and usually would be merchants buying from the manufacturer and selling to the public, — such persons are to be treated as agents, or as owners of the lamps consigned to them under such contracts.” 272 U. S., at 483-484.

To answer that question, the Court examined the operative provisions of the consignment agreement to determine whether the agreement created a valid agency or whether, in fact, title effectively passed to the so-called consignee. Id., at 483-488. If the latter were the case, the price-fixing requirement would have made the agreement nothing more than a resale-price-maintenance scheme, unlawful under the antitrust laws, cf. Dr. Miles Medical Co. v. Park & Sons Co., 220 U. S. 373, regardless of whether or not the article sold was patented. Similarly, if the agreement created a bona fide agency, the consignment would be valid under the antitrust laws, again regardless of whether or not the article consigned were patented.

Possession of patent rights on the article allegedly-consigned has no legal significance to an inquiry directed to ascertaining whether the burdens, risks, and rights of ownership actually remain with the principal or have passed to his agent. Nor is the power of a consignor to fix the prices at which his consignee sells augmented in any respect by the possession of a patent on the goods so consigned. It is not by virtue of a patent monopoly that a bona fide consignor may control the price at which his consignee sells; his control over price flows from the simple fact that the owner of goods, so long as he remains the owner, has the unquestioned right to determine the price at which he will sell them.

It is clear, therefore, that the Court today overrules' General Electric. It does so, even though the validity of that decision was not challenged in the briefs or in oral argument in this case. I should have thought that a decision of such impact and magnitude could properly be reached only after careful consideration of all relevant considerations and preferably by a full Court. Today’s upsetting decision carries with it the most severe consequences to a large sector of the private economy. We cannot be blind to the fact that commercial arrangements throughout our economy are shaped in reliance upon this Court’s decisions elaborating the reach of the antitrust laws. Everyone knows that consignment selling is a widely used method of distribution all over the country. By our decision today outlawing consignment selling if it includes a price limitation, we inject severe uncertainty into commercial relationships established in reliance upon a decision of this Court explicitly validating this method of distribution. We create, as well, the distinct possibility that an untold number of sellers of goods will be subjected to liability in treble damage suits because they thought they could rely on the validity of this Court’s decisions.

If the record now before us actually required re-examination of the General Electric case, I think that in view of the serious considerations which I have mentioned we should set this case for reargument and invite the Justice Department to express its views. But the fact is that in the present posture of this case, this broad issue need not be decided. The record upon which the District Court entered its summary judgment is wholly inadequate to support a realistic assessment of the actual nature and effect of the so-called lease-and-consignment agreement here involved. As the Court of Appeals pointed out, “[t]he record is not an easy one to read. No written pretrial stipulation of facts was entered into nor was any formal pretrial order made. . . . The result of all this was to create a most unsatisfactory record .... As the record now stands, it is almost impossible to determine what agreements, if any, were reached at pretrial.” 311 F. 2d, at 767.

After a trial on the merits it may be determined that the scheme here involved, although on its face a bona fide lease-and-consignment agreement, was in actual operation and effect a system of resale price maintenance. Or the District Court after a trial might find that despite the formal provisions of the lease-and-consignment agreement, there actually existed here some coercive arrangement otherwise violative of the antitrust laws. In either event, the question of the petitioner’s damages would then become an issue to be determined. Only if all these issues, and perhaps others, were resolved in favor of the respondent, would there be presented the question of the continuing validity of the General Electric doctrine. Consequently, re-examination of that case should certainly await another day.

I would vacate the judgment of the Court of Appeals and remand this case to the District Court for a plenary trial of all the issues.

Memorandum of

Mr. Justice Brennan and Mr. Justice Goldberg.

We do not necessarily disagree with the Court that “resale price maintenance through the present, coercive type of 'consignment’ agreement is illegal under the antitrust laws, and that petitioner suffered actionable wrong or damage.” We think, however, that the Court should not decide that question either as to fact or law on the record upon which this summary judgment was entered. Since the decision may be expected to affect consignment agreements in many businesses, including outstanding agreements that may have been entered into in reliance upon United States v. General Electric, 272 U. S. 476, the Court ought not pronounce that judgment without the benefit of a trial of the question whether this is a “coercive type of 'consignment’ agreement,” and without affording interested parties, including the Antitrust Division of the Department of Justice, an opportunity to express their views. We therefore agree with Mr. Justice Stewart and would vacate the judgment of the Court of Appeals and remand this case to the District Court for a plenary trial of all the issues.

      As of December 31, 1957, Union Oil supplied gasoline to 4,133 retail stations in the eight western States of California, Washington, Oregon, Nevada, Arizona, Montana, Utah and Idaho. Of that figure, 2,003 stations were owned or leased by Union Oil and, in turn, leased or subleased to an independent retailer; 14 were company-operated training stations; and the remaining 2,116 stations were owned by the retailer or leased by him from third persons. Union Oil had “consignment” agreements as of that date with 1,978 (99%) of the lessee-retailers and with 1,327 (63%) of the nonlessee-retailers.

       See the McGuire Act, 66 Stat. 631, 15 U. S. C. §45; the Miller-Tydings Act, 50 Stat. 693, 15 U. S. C. § 1; United States v. Socony-Vacuum Oil Co., 310 U. S. 150.

       H. R. Rep. No. 1958, 85th Cong., 2d Sess., S. Rep. No. 1555, 85th Cong., 2d Sess.

       H. R. Rep. No. 1958, supra, note 3, at 1.

       See H. R. Rep. No. 1157, 85th Cong., 1st Sess., pp. 6-7. The Assistant Attorney General in charge of the Antitrust Division, Department of Justice, testified:
      “Another issue relating to price fixing concerns certain of the practices which the major oil companies have used to preserve their tank wagon price structure; for example, the placing of the dealer on a commission or consignment agency basis, which narrows his normal margin of profit and effectively fixes the retail price.” Id., at 7. The Committee report said:
      “One of the effects of this expansion of commission and consignment outlets is that more and more service station operators lose their status as independent businessmen. The selling price and gross margin of profit per gallon in the commission-type stations are wholly within the control of the supplier.” Ibid.

       See Hearings, House Select Committee on Small Business, 85th Cong., 1st Sess., H. R. Res. 56, Pt. Ill, pp. 79-80. The same official gave this justification for the consignment program — a justification similar to that traditionally advanced for resale price maintenance:
      “Consignment is our method of protecting our dealers’ profit margins during disturbed retail price conditions, at the same time maintaining our dealers’ positions as people handling a premium quality product. We have not used consignment as a means of unfair competition, nor has it been used to price any dealer out of any station. It has instead been used by us to maintain a competitive relationship between our dealers’ prices and those of our competitors.
      “We are proud of our retail consignment program which has accomplished the ends outlined above. We have been able to make these accomplishments without taking away any of the independence of our dealers. Through our consignment program we have established and maintained under all conditions the minimum guaranteed margins for our dealers that are the best in the industry. It has brought our dealers one other substantial benefit also — and I would like to point this out strongly — they have available for other uses the investment which otherwise would be in gasoline inventories. This amounts to an average of $2,500 per dealer.
      “If there is any suspicion or resentment by any dealers or dealer groups, it certainly appears that Union Oil Co.’s retail consignment program is a greatly misunderstood one. It does not remove any aspect of a dealer’s independence other than giving us the right to name the dealer’s selling prices. It has not been used to create or disturb any retail price situations and instead has, as a matter of fact, contributed materially to the economic welfare of our dealers.
      “If we were today to withdraw the consignment program as it is now set up, we know that such action would be bitterly opposed by our dealers. Any problems that are laid at its doorstep — and there were some problems as there are in any new program — have been corrected to the point that a survey of our dealers today would reveal that the great majority of them are heartily in favor of consignment. We are able to offer the names of hundreds of our dealers who are in favor of the program.” Id., at 86-87.

         The basic agreement in force during most of the period when Simpson was a consignee provided that his commission was per gallon more than the amount by which the price at which the company “authorized” him to sell exceeded a posted “tank wagon” price applicable to those gallons. However, if the “authorized” price fell below a posted “minimum retail” price, the commission was reduced by 50% of the difference between “minimum retail” and “authorized” retail. In no event could the commission be less than 5.950 for regular and 5.750 for ethyl.
      Shortly before Simpson ceased to be a consignee the program was changed. The guaranteed minimum was eliminated and the consignee absorbed 20% of the difference if “authorized” prices fell below “minimum retail.” If the “authorized” price exceeded “minimum retail,” the commission increased by 80% of the excess, as compared with 100% thereof under the former plan.

       See Klaus, Sale, Agency and Price Maintenance, 28 Col. L. Rev. 312, 441, 443-454 (1928).

       A. A. Berle recently described the critical importance of price control to money making by the large oligarchies of business, or the “behemoths" as he calls them:
      “Are these behemoths good at making goods — or merely good at making money ? Do they come out better because they manufacture more efficiently — or because they ‘control the market' and collect unduly high prices from the long-suffering American consumer?
      “Again, no one quite knows. It is pretty clear that most prices are established only partly by competition, and partly by administration. Economists are just beginning to wrestle with the problem of 'administered' prices. The three or four ‘bigs’ in any particular line are happy to stay with a good price level for their product. If the price gets too high, some smart vice president in charge of sales may see a chance to take a fat slice of business away from his competitors.
      “But while any one of the two or three bigs knows he can reduce prices and start taking all the business there is, he knows, too, that one or all of his associates will soon drop the price below that. In the ensuing price war, nobody will make money for quite a while.
      “So, an uneasy balance is struck, and everyone’s price remains about the same. Shop around for an automobile and you will see how this works. Economists call it ‘imperfect competition’ — a tacitly accepted price that is not necessarily the price a stiff competitive free market would create. Only big concerns can swing this sort of competition effectively.
      “We do not really know whether bigs make more money because they are efficient or because, through their size, they can ‘administer’ prices.” Bigness: Curse or Opportunity? New York Times Magazine, Feb. 18, 1962, pp. 18, 55, 58.

       In General Electric the consignee was responsible for lost, damaged or missing items from the stock in his possession and the consignor assumed all risks of fire, flood and obsolescence, while in the instant case the consignee is “responsible to Consignor for all gasolines consigned to him, or for loss thereof or damage thereto from any cause whatsoever other than earthquake, lightning, flood, fire or explosion.not caused by his negligence and will pay Consignor for all gasolines sold, lost or damaged."
      In General Electric the consignees were, in their regular business, wholesale or retail merchants of other merchandise and some of them had previously so handled the consignor’s lamps, while in the instant case the consignees, although some of them had previously been regular retail merchants, deal exclusively in the consignor’s gasoline.
      General Electric Co. paid “all” taxes assessed on the stock of lamps, whereas Union Oil pays only property taxes.
      General Electric Co. carried “whatever insurance is carried” on the stock held by consignees, while Union Oil apparently is not obligated to carry any insurance.

         Without commenting on their significance, the Court does purport to discover in the operative provisions of the two agreements factual differences regarding the tax and insurance burdens assumed by the consignors. On closer examination, however, even these purported differences disappear. From the records in the cases, it is clear that both companies assumed the same tax burden' — payment of property taxes on the consigned goods. And since both companies bore virtually the same insurable risks of loss or damage to the goods consigned, the fact that General Electric apparently "carried 'whatever insurance is carried’ on the stock held by consignees, while Union Oil apparently is not obligated to carry any insurance” is no distinction at all.
      The Court implies that the terms of this agreement providing that the consignee must carry personal liability and property damage insurance; that the consignee is responsible for losses of consigned gasoline incurred in the ordinary course of events; and that the consignee must pay his own costs of operation, are inconsistent with a valid consignment agreement. But such provisions are common to consignment agreements. They merely illustrate the well-recognized fact that these retail gasoline dealers are both independent businessmen and agents. A consignee is commonly defined as one who “in the pursuit of an independent calling,” is engaged by another as his agent to sell property. See, e. g., Calif. Civil Code § 2026. Consequently, it is not at all surprising for a consignment agreement to provide both that a consignee bear the expenses of conducting his own business, and that he be responsible for loss or damage to the goods occurring in the ordinary course of business. The Court in General Electric explicitly found such provisions unobjectionable, 272 U. S., at 48A-485, and further observed that a provision placing the burden of risk of loss or damage to goods on the consignee “is only a reasonable provision to secure [the consignee’s] careful handling of the goods entrusted to him.” Id., at 484. Nor is the requirement that Simpson carry property damage and personal liability insurance of significance. Such a provision serves the reasonable purpose of protecting the consignor from responsibility (which might be imputed by virtue of the agency relationship) for liabilities incurred by Simpson arising out of or in connection with Simpson’s business.
      The only remaining point which the Court makes is that the consignee’s commission declines as retail prices drop. But it is in the very nature of commissions that they be geared to prices, and it is thus typical of consignment agreements that the consignee bears some of the risk of price declines. In fact, the consignment agreement challenged in the General Electric ease provided that “[t]he agent is allowed a compensation of 10% of the list prices of the lamps ...” Since the General Electric Company set the list price, it would have been as correct to say in that ease, as it is in this one, that the consignee’s commission declined as retail prices dropped. Moreover, under Union’s agreement, Simpson received a minimum guaranteed commission regardless of the extent of price declines, thereby substantially restricting his exposure to the risks of a decline in the market price.

       The quotations in the majority opinion from the General Electric ease relate to a wholly separate second issue involved in that case— the validity of a license granted by General Electric to Westinghouse, under the patents owned by the former, to manufacture and sell lamps at prices fixed by the patentee-licensor — and have no relevance whatsoever to the issue here. Since the source of power over price by the patentee-consignor in General Electric was not his patent, and since the question of patent monopoly is not involved in this case, the patent cases cited by the Court are also singularly irrelevant to the issue here.

       There is no reason to suppose that Mr. Justice Harlan will be disqualified in any future case which may involve the question of the continuing validity of the General Electric rule.

       The Department's views are not known, because they have not been sought. Indeed, had they been sought, there is a substantial possibility in light of the Department's recognition and tacit validation of consignment selling under the 1959 consent decree entered against the large West Coast oil companies, United States v. Standard Oil Co. of California, 1959 Trade Cases ¶ 69,399, p. 75,522 et seq., that the Government would have taken the position that the rule of General Electric should be left undisturbed.

       In that event, the effect of California’s Fair Trade Act, Cal. Bus. & Prof. Code § 16900, would have to be considered. See 66 Stat. 631, 16 U. S. C. § 45 (McGuire Act).


author: Mr. Justice Douglas Mr. Justice Stewart,

text:
    FEDERAL POWER COMMISSION v. TEXACO INC. et al.
    No. 386.
    Argued March 25, 1.964.
    Decided April 20, 1964.

      Howard E. Wahrenbrock argued the cause for petitioner. With him on the brief were Solicitor General Cox, Ralph S. Spritzer, Richard A. Solomon, Josephine H. Klein and Peter H. Schiff.

      Alfred C. DeCrane, Jr. argued the cause for respondent Texaco Inc. With him on the brief was Paul F. Schlicher. Carroll L. Gilliam argued the cause for respondent Pan American Petroleum Corp. With him on the brief were W. W. Heard, Wm. H. Emerson and William J. Grove.

      J. Calvin Simpson and John T. Murphy filed a brief for the State of California and the Public Utilities Commission of California, as amici curiae, urging reversal.
   Mr. Justice Douglas

delivered the opinion of the Court.

The Federal Power Commission in its regulation of independent producers of natural gas has required them to file their contracts as rate schedules. This was done by regulations which evolved as a result of a series of rule-making proceedings. The pertinent regulations presently provide that only certain pricing provisions in the contracts of independent producers are “permissible,” any other being “inoperative and of no effect at law.” The regulations go on to say that any contract executed on or after April 2, 1962, containing price-changing provisions other than the “permissible” ones, “shall be rejected” so far as producer rates are concerned, that a producer’s application for a certificate of public convenience and necessity under § 7 of the Natural Gas Act “shall be rejected” if any contract submitted in support of it contains any of the forbidden provisions, and that, so far as pipeline certificates are concerned, any producer contract executed after that date which has that infirmity “will be given no consideration in determining adequacy” of a pipeline company’s gas supply.

These regulations were adopted pursuant to the provisions of § 4 of the Administrative Procedure Act, 60 Stat. 238, 5 U. S. C. § 1003. General notice of the proposed rule making was published in the Federal Register as required by § 4 (a) of that Act. The Commission also gave interested parties a “hearing” under § 4 (b). No oral argument was had but an opportunity was afforded for all interested parties to submit their views in writing; and the two respondents in this case — Texaco and Pan American — along with others, did so.

Later, each respondent submitted an application for a certificate of public convenience and necessity under § 7 of the Natural Gas Act, to supply natural gas to a pipeline company. Section 7 provides, with exceptions not presently material, that the Commission “shall set” such an application “for hearing.” Since, however, the applications disclosed price clauses that are not “permissible” under the regulations, the Commission without a hearing rejected the applications. 28 F. P. C. 551; 29 F. P. C. 378. Petitions for review were filed with the Court of Appeals, which set aside the orders of the Commission. 317 F. 2d 796. It held that while the regulations are valid as a statement of Commission policy, they cannot be used to deprive an applicant of the statutory hearing granted those who seek certificates of public convenience and necessity. The two cases are here in one petition for certiorari which we granted because of an apparent conflict between that decision and Superior Oil Co. v. Federal Power Comm’n, 322 F. 2d 601, decided by the Court of Appeals for the Ninth Circuit. 375 U. S. 902.

I.

A preliminary question, which concerns Texaco Inc., alone, is whether venue to review these orders of the Commission was properly in the Tenth Circuit. The governing provision is § 19 (b) of the Natural Gas Act which provides:

“Any party to a proceeding under this Act aggrieved by an order issued by the Commission in such proceeding may obtain a review of such order in the court of appeals of the United States for any circuit wherein the natural-gas company to which the order relates is located or has its principal place of business, or in the United States Court of Appeals for the District of Columbia . . . .”

The term “is located” would have an ambivalent meaning if venue lay only in “any circuit” where the natural gas company “is located.” But in the context of § 19 (b) “any circuit” covers either the place where the company “is located” or where it “has its principal place of business.” Hence the main argument of Texaco derives from the fact that “is located” was substituted for “resides” in an early draft of the bill which later emerged as the Federal Power Act, from which § 19 (b) of the Natural Gas Act is derived. The Court of Appeals found that change decisive; but we can only conjecture as to why it was made, as no explanation appears. The bill in which “resides” was used gave review to “any person aggrieved” and the bill substituting “is located” for “resides” substituted “licensee or public utility” for “person aggrieved.” Since the latter language was changed from the personal to the impersonal it may be, as the Commission says, that the Congress was trying to use common legal parlance that a corporation “can have its legal home only at the place where it is located by or under the authority of its charter,” as stated in Ex parte Schollenberger, 96 U. S. 369, 377. And see Neirbo Co. v. Bethlehem Corp., 308 U. S. 165, 169. However that may be, we think that “is located” means more than having physical presence or existence in a place, since the alternate venue referred to in § 19 (b) is “principal place of business.” The Court of Appeals recognized the overlap between the two clauses inherent in its construction but resolved its doubts in favor of Tenth Circuit venue because the gas sold by Texaco under the contested contracts was produced in that circuit and the performance of the contract took place there.

The Act with which we deal was enacted August 26, 1935. At that time and down to the 1948 amendment of § 1391 of the Judicial Code, 28 U. S. C. § 1391 (c), the only residence of a corporation for purposes of federal venue was the State and district in which it had been incorporated. See 9 Fletcher, Cyclopedia Corporations (1931), § 4385. That theme runs through the cases. See, e. g., Shaw v. Quincy Mining Co., 145 U. S. 444, 449-450. We conclude that, although “located” sometimes is used as indicating a place of business (Mercantile Nat. Bank v. Langdeau, 371 U. S. 555), in the setting of this Act “is located” and “resides” are equated and that “is located” refers in the case of Texaco to its State of incorporation. There is symmetry in that construction as the choice, so far as circuits are concerned, is then left between that State, the “principal place of business” (with no penumbra of other places of business, as here), or the District of Columbia where the Commission sits.

Texaco is a Delaware corporation and there is no claim that its principal place of business is within the Tenth Circuit. The Court of Appeals therefore erred in failing to dismiss its petition for lack of venue. There is, however, another respondent, Pan American, whose principal place of business is within the Tenth Circuit. We therefore proceed to the merits of its application.

II.

The main issue in the case is whether the “hearing” granted under § 4 (b) of the Administrative Procedure Act is adequate, so far as the price clauses are concerned, for purposes of § 7 of the Natural Gas Act. We think the Court of Appeals erred, that the present case is governed by the principle of United States v. Storer Broadcasting Co., 351 U. S. 192, and that the statutory requirement for a hearing under § 7 does not preclude the Commission from particularizing statutory standards through the rule-making process and barring at the threshold those who neither measure up to them nor show reasons why in the public interest the rule should be waived.

In Storer the Federal Communications Commission, pursuant to its general rule-making authority, limited permissible multiple ownership for radio and television stations. Storer, which had seven radio stations and five television stations, was under that rule automatically disqualified for further licensing. To surmount that barrier it argued that the Act required a license to issue where the public interest would be served and that before an application could be denied, a hearing must be held. We said:

“We read the Act and Regulations as providing a ‘full hearing’ for applicants who have reached the existing limit of stations, upon their presentation of applications conforming to Rules 1.361 (c) and 1.702, that set out adequate reasons why the Rules should be waived or amended. The Act, considered as a whole, requires no more. We agree with the contention of the Commission that a full hearing, such as is required by § 309 (b) ... would not be necessary on all such applications. As the Commission has promulgated its Rules after extensive administrative hearings, it is necessary for the accompanying papers to set forth reasons, sufficient if true, to justify a change or waiver of the Rules. We do not think Congress intended the Commission to waste time on applications that do not state a valid basis for a hearing. If any applicant is aggrieved by a refusal, the way for review is open.” 351 U. S., at 205.

In the present case, as in Storer, there is a procedure provided in the regulations whereby an applicant can ask for a waiver of the rule complained of. Facts might conceivably be alleged sufficient on their face to provide a basis for waiver of the price-clause rules and for a hearing on the matter. Cf. Atlantic Refining Co., 28 F. P. C. 469 ; 29 F. P. C. 384. But no such attempt was made here by Pan American, the only respondent to which the present point has any immediate applicability.

The rule-making authority here, as in Storer, is ample to provide the conditions for applications under § 4 or § 7. Section 16 of the Natural Gas Act gives the Commission power to prescribe such regulations “as it may find necessary or appropriate to carry out the provisions of this Act.” We deal here with a procedural aspect of a rate question and with a certificate question that is important in effectuating the aim of the Act to protect the consumer interest. Federal Power Comm’n v. Hope Natural Gas Co., 320 U. S. 591, 610. In a rate case under § 5 (a) of the Act the Commission can pass on existing contracts affecting rates, can find that particular contracts are “unjust, unreasonable, unduly discriminatory, or preferential” and thereupon has power to determine the “just and reasonable” rate or contract and “fix the same.” And see United Gas Pipe Line Co. v. Mobile Gas Service Corp., 350 U. S. 332, 341. And where, as here, applications for certificates are made under § 7 of the Act, the Commission under § 7 (e) is required to control the terms and conditions under which natural gas companies, such as respondent, may initiate sales at wholesale of natural gas in commerce. Atlantic Refining Co. v. Public Service Comm’n, 360 U. S. 378, 389.

Pan American does not disagree on that score; it insists that those changes and adjustments can be made only after an adversary hearing. To that there are two answers. The present regulations do not pass on the merits of any rate structure nor on the merits of a certificate of public convenience and necessity; they merely prescribe qualifications for applicants. Those qualifications are in the category of conditions that relate to the ability of applicants to serve the consumer interest in this regulated field. They are kin to the kind of capital structure that an applicant has and to his ability by reason of the rate structure to serve the public interest. It must be remembered that under this Act rate increases are initiated by the natural gas company, the Commission having the burden by reason of § 4 (e) of the Act to initiate a hearing on their legality with only a limited power to suspend new rates. See United Gas Pipe Line Co. v. Mobile Co. Service Corp., supra. Natural gas companies that seek to enter the field with prearranged escalator clauses and the like have a built-in device for ready manipulation of rates upward. Protection of the consumer interests against that device may be best achieved if it is given at the very threshold of the enterprise. At least the Commission may so conclude; and the legislative history makes clear that its authority reaches that far. H. R. Rep. No. 1290, 77th Cong., 1st Sess., pp. 2-3, states:

. . The bill when enacted will have the effect of giving the Commission an opportunity to scrutinize the financial set-up, the adequacy of the gas reserves, the feasibility and adequacy of the proposed services, and the characteristics of the rate structure in connection with the proposed construction or extension at a time when such vital matters can readily be modified as the public interest may demand. . . .” (Italics added.)

And see S. Rep. No. 948, 77th Cong., 2d Sess., pp. 1-2.

To require the Commission to proceed only on a case-by-case basis would require it, so long as its policy outlawed indefinite price-changing provisions, to repeat in hearing after hearing its'conclusions that condemn all of them. There would be a vast proliferation of hearings, for as a result of Phillips Petroleum Co. v. Wisconsin, 347 U. S. 672, there are thousands of individual producers seeking applications. See Wisconsin v. Federal Power Comm’n, 373 U. S. 294, 300. We see no reason why under this statutory scheme the processes of regulation need be so prolonged and so crippled.

Pan American finally argues that the “hearing” accorded it under § 4 (b) of the Administrative Procedure Act did not comply with that Act nor with the Natural Gas Act. It points out that § 7 of the Natural Gas Act requires a hearing and that § 5 of the Administrative Procedure Act provides, with exceptions not relevant here, that a full-fledged adversary-type of hearing be held in “every case of adjudication required by statute to be determined on the'record after opportunity for an agency hearing. . . .” “Adjudication” is defined in § 2 (d) of the Administrative Procedure Act as “agency process for the formulation of an order”; “order” is defined as “the whole or any part of the final disposition . . . of any agency in any matter other than rule making but including licensing.” And “licensing” is defined as “agency process respecting the . . . denial ... of a license.” § 2 (e). What the Commission did in these cases, however, is not an “adjudication,” not “an order,” not “licensing” within the meaning of § 2. Whether Pan American can qualify for a certificate of public convenience and necessity has never been reached. It has only been held that its application is not in proper form because of the pricing provisions in the contracts it tenders. No decisions on the merits have been reached. The only hearing to which Pan American so far has been entitled was given when the regulations in question were adopted pursuant to § 4 (b) of the Administrative Procedure Act.

Reversed.

Mr. Justice Stewart,

dissenting in part.

I agree with Part I of the Court’s opinion, holding that the petition of Texaco Inc. should have been dismissed for lack of venue. I cannot agree, however, that a gas producer’s application for a certificate of public convenience and necessity can be rejected without the full adjudicative hearing to which § 7 of the Act entitles him. My reasons are substantially those expressed in Judge Breitenstein’s opinion for the Court of Appeals. 317 F. 2d 796, 804-807.

       See Natural Gas Act, 52 Stat. 821-833, as amended, 15 U. S. C. §§717-717w; Phillips Petroleum Co. v. Wisconsin, 347 U. S. 672.

       See Order No. 174-B, 13 F. P. C. 1576, 18 CFR § 157.25; Order No. 232, 25 F. P. C. 379, 26 Fed. Reg. 1983, as amended by Order No. 232A, 25 F. P. C. 609, 26 Fed. Reg. 2850; Order No. 242, 27 F. P. C. 339, 27 Fed. Reg. 1356; Reg. §154.91 et seq., as amended, 18 CFR (Cum. Supp. 1963) § 154.91 et seq.

       Section 154.93 defines the “permissible” provisions:
      “(a) Provisions that change a price in order to reimburse the seller for all or any part of the changes in production, severance, or gathering taxes levied upon the seller;
      “(b) Provisions that change a price to a specific amount at a definite date; and
      “(c) Provisions that, once in five-year contract periods during which there is no provision for a change in price to a specific amount (paragraph (b) of this section), change a price at a definite date by a price-redetermination based upon and not higher than a producer rate or producer rates which are subject to the jurisdiction of the Commission, are not in issue in suspension or certificate proceedings, ■and, are in the area of the price in question . . . .”

         Ibid. For a discussion of escalation clauses see Pure Oil Co., 25 F. P. C. 383, aff’d 299 F. 2d 370.

        Ibid.

       § 157.25.

       §157.14 (a) (10) (v).

       Section 4 (b) provides:
      “After notice required by this section, the agency shall afford interested persons an opportunity to participate in the rule making through submission of written data, views, or arguments with or without opportunity to present the same orally in any manner; and, after consideration of all relevant matter presented, the agency shall incorporate in any rules adopted a concise general statement of their basis and purpose. Where rules are required by statute to be made on the record after opportunity for an agency hearing, the requirements of sections 7 and 8 shall apply in place of the provisions of this subsection.”

       Pan American’s contracts provide (1) for a one-cent escalation in 1968, 1973, and 1978, and (2) for a redetermination of a “fair market price” in each five-year period commencing October 1, 1983, but in no event for less than 20.5 cents per thousand cubic feet.
      'Texaco’s contract contained price clauses to become effective at definite times or upon the happening of definite circumstances in the future, e. g., the passage of 5, 10, or 15 years, increased taxation on the production, severance, gathering, transportation, sale, or delivery of gas or as a result of renegotiations undertaken six months prior to the beginning of the third (1974) and fourth (1979) of the four five-year periods into which the contract term was divided.

       See § 313 (b) of the Federal Power Act, 49 Stat. 860, 16 U. S. C. § 8251 (b); cf. S. 1725, 74th Cong., 1st Sess., with S. 2796 of the same session.

       Regulation § 1.7 (b), 18 CFR (Cum. Supp. 1963) § 1.7 (b), provides in relevant part:
      “A petition for the issuance, amendment, waiver, or repeal of a rule by the Commission shall set forth clearly and concisely petitioner’s interest in the subject matter, the specific rule, amendment, waiver, or repeal requested, and cite by appropriate reference the statutory provision or other authority therefor. If a rate filing is accompanied by a request for waiver pursuant to this section the thirty-day notice period provided in section 4 (d) of the Natural Gas Act and section 205 (d) of the Federal Power Act shall begin to run if and when the Commission grants the request. Such petition shall set forth the purpose of, and the facts claimed to constitute the grounds requiring, such rule, amendment, waiver, or repeal, and shall conform to the requirements of §§ 1.15 and 1.16. Petitions for the issuance or amendment of a rule shall incorporate the proposed rule or amendment.”

       The Commission in making the last amendment to the regulation now challenged said:
      “Protection of the public interest is the touchstone of our regulatory powers under the Natural Gas Act. The Commission’s obligation under the Act to the natural gas companies, as one segment of the public whose interest is to be protected, does not compel it to acquiesce in the use of contracts which carry provisions incompatible with a scheme of effective rate regulation. To be sure, the proposed rule will have impact upon contractual practices which have been fairly widespread. But the real issue is not one of ‘freedom of contract’; the question is whether the rule is rationally related to a condition which requires correction if regulatory objectives embraced by the statute are to be achieved. See American Trucking Associations v. United States, 344 U. S. 298. In our view, the rule we adopt fully meets this test.
      “We held in the Pure Oil case [see note 4, supra] that indefinite escalation clauses are contrary to the public interest and restated this conclusion in Order No. 232A. Increases in producer prices, triggered by indefinite escalation clauses, have resulted in a flood of almost simultaneous filings. These filings bear no apparent relationship to the economic requirements of the producers who file them. The Natural Gas Act contemplates that prices, to be just and reasonable, be related to economic needs. The elimination of indefinite escalation provisions does not, of course, cut off other avenues by which a producer may make provision for filing for increased rates.
      “Filings under indefinite escalation clauses have created a significant portion of the administrative burdens under which this Commission is laboring today. The Natural Gas Act contemplates that rate increases shall be sought when there is economic justification, but not that there shall be a chain reaction in a wide area whenever one producer in the area negotiates a contract at a new price level. The Act requires the Commission to give precedence to the hearing and decision of rate increases, but the complexity of indefinite price clauses requires it to spend an undue amount of time in their interpretation and application at the expense of making a prompt determination of the rate issues involved. Accordingly, in protecting the public against waves of increases which have no defensible basis, we also serve the need — which we believe we should take into account— of making the tasks of regulation more manageable.” 27 F. P. C. 339, 340, 27 Fed. Reg. 1356, 1357.

       In one recent case seven years elapsed between the date of the new rate filing and the close of the review proceedings. Shell Oil Co., 18 F. P. C. 617, 19 F. P. C. 74, set aside sub nom.. Shell Oil Co. v. Federal Powér Comm’n, 263 F. 2d 223, rev’d sub nom. Texas Gas Transmission Corp. v. Shell Oil Co., 363 U. S. 263; on remand, aff'd sub nom. Shell Oil Co. v. Federal Power Comm’n, 292 F. 2d 149, cert. denied, 368 U. S. 915.

       See note 8, supra.