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FTC V. A.P.W. PAPER CO., INC., 328 U. S. 193 (1946)

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U.S. Supreme Court

FTC v. A.P.W. Paper Co., Inc., 328 U.S. 193 (1946)

Federal Trade Commission v. A.P.W. Paper Co., Inc.

No. 320

Argued February 4, 1946

Decided May 6, 1946

328 U.S. 193

Syllabus

Prior to 1905, respondent used "Red Cross" as a trade name and displayed the Red Cross symbol on its products. Section 4 of the American Red Cross Act of January 5, 1905, forbade

"any person or corporation, other than the Red Cross of America, not now lawfully entitled to use the sign of the Red Cross, hereafter to use such sign . . . for the purposes of trade or as an advertisement to induce the sale of any article whatsoever."

That section was amended in 1910 so as to forbid the use of the symbol or the words "Red Cross" for the purpose of trade or as an advertisement "to induce the sale of any article" or "for any business or charitable purpose" by any person other than the American National Red Cross or the sanitary and hospital authorities of the army and navy, except that "no person, corporation, or association that actually chanroblesvirtualawlibrary

Page 328 U. S. 194

used . . . the said emblem . . . or words for any lawful purpose prior to" January 5, 1905 "shall be deemed forbidden by this Act to continue the use thereof . . ." The Geneva Convention of 1929, ratified by the United States in 1932, bound the contracting Governments to take or recommend to their legislatures such measures as might be necessary "to prevent the use by private persons . . . of the emblem or the name of the Red Cross" from the time set in the legislation and not later than five years after the effective date of the convention. Congress enacted no legislation to effectuate this undertaking. In 1942, the Federal Trade Commission charged petitioner with a violation of § 5(a) of the Federal Trade Commission Act, as amended by the Act of March 21, 1938, which makes unlawful "unfair methods of competition in commerce, and unfair or deceptive acts or practices in commerce." After appropriate administrative proceedings, the Commission found that respondent's use of the words and symbol were misleading to the purchasing public, and ordered respondent to cease and desist from using the words "Red Cross" to describe its products and from displaying the symbol on them.

Held:

1. Under the facts of this case, the Commission may not absolutely forbid the use of the words and symbol by respondent. Pp. 328 U. S. 198, 328 U. S. 200, 328 U. S. 204.

(a) The 1910 Act granted, or at least recognized, the right of pre-1905 users to continue their use. P. 328 U. S. 200.

(b) This specific right was not intended to be swept away by the 1938 amendment to the Federal Trade Commission Act. P. 328 U. S. 202.

(c) Since Congress has taken no action to effectuate the undertaking in the Geneva Convention of 1929 to prevent their use by private persons, it does not impair the rights of good faith pre-1905 users granted or recognized by the 1910 Act. P. 328 U. S. 203.

2. Reading the 1910 and 1938 Acts in pari materia, the good faith use of the words and symbols by pre-1905 users is permissible; but the Commission may require the addition of language which removes any misleading inference that the products are in fact sponsored, approved, or in any manner associated with the American National Red Cross. P. 328 U. S. 202.

3. The fashioning of the order which should be entered is entrusted to the Commission, which has wide latitude for judgment. P. 328 U. S. 203.

149 F.2d 424 affirmed. chanroblesvirtualawlibrary

Page 328 U. S. 195

The Federal Trade Commission ordered respondent to cease and desist from using the words "Red Cross" to describe its products and from displaying the Greek red cross on them. 38 F.T.C. 1. On petition for review, the Circuit Court of Appeals reversed the Commission's order and remanded the case to the Commission for the formulation of a new order which, though not forbidding the use of the words and symbol, might require statements which would avoid any inference that the goods were sponsored or approved or in any way connected with the American National Red Cross. 149 F.2d 424. This Court granted certiorari. 326 U.S. 704. Affirmed, p. 328 U. S. 204.





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