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U.S. Supreme Court

FTC v. Motion Picture Advertising Svc. Co., Inc., 344 U.S. 392 (1953)

Federal Trade Commission v.

Motion Picture Advertising Service Co., Inc.

No. 75

Argued December 8, 1952

Decided February 2, 1953

344 U.S. 392


1. Respondent produces advertising motion pictures and distributes them in interstate commerce. It had exclusive contracts with 40% of the theaters which exhibit such films in the area where it operates. It and three other companies had exclusive contracts with 75% of such theaters in the United States. The Federal Trade Commission found, upon substantial evidence, that respondent's exclusive contracts unreasonably restrain competition and tend to monopoly, and that their use was an "unfair method of competition" in violation of § 5 of the Federal Trade Commission Act. It issued an order prohibiting respondent from entering into any such exclusive contract for more than a year or from continuing in effect any exclusive provision of an existing contract longer than a year after service of the order.

Held: the order is sustained. Pp. 344 U. S. 393-397.

(a) The Commission did not exceed the limits of its allowable judgment in restricting the exclusive contracts to one-year terms. Pp. 344 U. S. 395-396.

2. A plea of res judicata to the present proceeding of the Commission, based on a former proceeding which was directed at a conspiracy between respondent and other distributors involving the use of exclusive agreements, cannot be sustained, since the present proceeding charges no conspiracy and the issues litigated and determined are not the same as those in the earlier one. Pp. 344 U. S. 397-398.

194 F.2d 633 reversed.

In a proceeding upon a complaint charging "unfair methods of competition" in violation of § 5 of the Federal Trade Commission Act, the Commission entered a cease and desist order against respondent. 47 F.T.C. 378. The Court of Appeals reversed. 194 F.2d 633. This Court granted certiorari. 344 U.S. 811. Reversed, p. 344 U. S. 398. chanroblesvirtualawlibrary

Page 344 U. S. 393

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