Brice, Mitchell F

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IN THE MATTER OF MITCHELL F. BRICE, TRADING AS PARR SALES COMPANY COMPLAINT, FINDINGS, AND ORDER IN REGARD TO THE ALLEGED VIOLATION OF SUBSEC. (c) OF SEC. 2 OF AN ACT OF CONGRESS APPROVED OCT. 15•, 1914, AS AMENDED BY AN ACT OF CONGRESS APPROVED JUNE 19, 1936 Docket 4233. Co-mplaint, Aug. 13, 191,0-Deh.~ion, Not'. 2, 191,0 Where an individual who (1) was president, secretary-treasurer and director of, and owner of a large majority of the stock in a corporation engaged in a general wholesale merchandise busines.~. and which IJiaced orders for a substantial portion of the goods, wares, and merchandise, and particularly food stuffs, required in the ordinary conduct of its business with sellers located mostly in other States, and (2) was co-owner in a brokerage firm in the same city with another to whom, as his employee in various enterprises owned and controlled by him, be paid as compensation for services rendered a substantial amount of the brokerage fees and commissions received by said firm, through which said corporate wholesaler made Its purchases aforesaid from sellers in other States mostly- Accepted and received, through said brokerage firm, as brokerage fees or commissions, certain percentages paid by sucbi sellers on purdhases mjade through firm in question by corporate wholesaler aforesaid, and in which transactions sald ,individual was agent and acted in fact for and in behalf of aforesaid corporate wholesaler:

Held, That in accepting and receiving certain percentages of the sales prices upon purchases of commodities of said corporate wholesaler, in interstate commerce as aforesaid set forth, as brokerage fees or commissions, said · lndi>idual, In his individual capacity and while trading as member of such brokerage firm, violated provisions of section 2 (c) of Clayton Act, as amended by Robinson-Patman Act.

J/r. J. T. Hem lett, for the Commission.

Mr. Duncan Graham, of Vidalia, Ga., for respondent. Complaint The Federal Trade Commission, having reason to believe that the party respondent named in the caption hereof a~d hereinafter more particularly designated and deser~bed, since June 19, 1936, has violated and is now violating the provisions of subsedion ( <;.) of section 2 of the Clayton Act (U.S. C., title 15, see. 13) as amended by the Robinson-Patman Act approved June 19, 1936, hereby issues its complaint, stating its charges with respect thereto as follows: PARAGRAPH 1. Tanner-Brice Co., Inc., a corporation orp;aniz~d ana existing under and by virtue of the I a ws of the State of Georgia, with its principal office and place of business located at Vidalia, Ga., is engaged in a general wholesale merchandise business and operates PARR SALES CO. 1287 1.286 . Complaint a chain of retail grocery stores under the trade name of Sims Stores, the principal ones of which are located at Vidalia, Swainsboro, Dublin, Douglas, and Baxley, Ga. Practically all the merchandise sold by the Sims Stores is purchased from the Tanner-Brice Co., Inc.

PAR. 2. The respondent, Mitchell F. Brice, an individual residing in the city of Vidalia, Ga., is now and has been since June 19, 1936, Pre~id~t,. ~~eretl_!,t:Yr:-~r~~tg_·er,_cJir~ctor, and a major stockholder in Tanner-Brice Co., Inc. Said respondent Mitchell F. Brice owns and controls 83 percent of the outstanding capital stock, and actively manages and conducts the business of said Tanner-Brice Co., Inc. PAR. 3. Respondent Mitchell F. Brice is a member of a firm engaged in the brokerage business under the trade name Parr Sales Co., maintaining an office and place of business in Vidalia, Ga. The Parr Sales Co. is a firm owned by respondent Mitchell F. Brice and Francis K. Graham. Said Francis K. Graham is a former employee of the Tanner-Brice Co., Inc., and is now employed by the said Mitchell F. Brice to render services to various other enterprises owned and controlled by respondent Mitchell F. Brice. PAR. 4. Tanner-Brice Co., Inc., places orders for a substantial portion of the goods, wares, and merchandise, particularly foodstuffs, required in the ordinary conduct of its business with sellers who are in most cases located in States of the United States other than the State in which said Tanner-Brice Co., Inc., is located, through the brokerage firm of Mitchell F. Brice and Francis K. Graham trading as Parr Sales Co. As a result of the transmission and e;<:ecution of said orders, as aforesaid, goods, 'vares and merchandise, particularly foodstuffs, are, in the case of each such order, and 1!1 a continuous succession of such orders, sold, transported and delivered by one or more of such sellers across State lines to the Tanner-Brice Co.

PAR. 5. In the course and conduct of the buying and selling transactions hereinabove referred to resulting in the transportation and ?_delivery of goods, wares, and me1:ch~ndise, particularly foodstuffs, 111 interstate commerce from one or more sellers to said Tanner- Brice Co., Inc., sellers have transmitted and paid, and do transmit and pay, to the brokerage firm of Mitchell F. Brice and Francis I~: Graham, trading as the Parr Sales Co., brokerage fees or commise"ions, the same being a certain percentage (usually from 211z ~ercent to 5 percent) of the .sales prices of such purchases. Since June 19, 1936, sellers have paid brokerage fees and commissions to, and the same have been received by, the brokerage firm of Mitchell F. Brice and Francis K. Graham, trading as Parr 29Hi>16'"-41-vol. 81--~4 Findings 31F. T.O.

Sales Co., upon the purchases of Tanner-Brice Co., Inc., in the manner hereinabove described in substantial amounts. PAR. 6. In all of the transactions of purchase and sale hereinabove referred to, since June 19, 1936, the respondent Mitchell F. Brice has been the agent, and has acted in fact for and in behalf of the Tanner-Brice Co., Inc.

PAR. 7. A substantial amount of the brokerage fees and commissions received by the brokerage firm of Mitchell F. Brice and Francis K. Graham trading as Parr Sales Co. in the manner aforesaid since June 19, 1936, has been paid to Francis K. Graham as compensation for services rendered by Francis K. Graham in his respective capacities as an employee of the various enterprises owned and controlled by respondent Mitchell F. Brice. PAR. 8. The transmission and payment of brokerage fees and commissions by sellers to said respondent Mitchell F. Brice as a member of the brokerage firm trading as the Parr Sales Co., and the receipt and acceptance of such brokerage fees and commissions by said respondent Mitchell F. Brice upon the purchases of the Tanner-Brice Co., Inc., in the manner and form hereinabove set forth, is in violation of the provisions of subsection (c) of section 2 of the act described in the preamble hereof.

Report, FINDINGs AS TO THE FACTs, AND ORDER Pursuant to the provisions of an Act of Congress entitled "An Act to supplement existing laws against unlawful restraints and monopolies and for other purposes,'~ approved October 15, 1914, the Clayton Act, as amended by an Act of Congress approved June 19, 1936, the Robinson-Patman Act (U. S. C. title 15, sec. 13), the Federal Trade Commission on the 13th day of August 1940, issued and served its complaint in this proceeding upon respondent Mitchell F. Brice, charging the respondent with violation of the provisions of subsection (c) of section 2 of the said act.

After the issuance of said complaint and the filing of respondent's answer, the Commission, by order entered herein, granted respondent's motion for permission to withdraw said answer and to substitute therefor an answer admitting all the material allegations of fact set forth in said complaint and waiving all intervening procedure and further hearings as to said facts, which substitute answer was duly filed in the office of the Commission. Thereafter, this proceeding regularly came on for final hearing before the Commission on the said complaint and substitute answer, and the Commission having duly considered the matter and being now fully advised in the premises, and being of the opinion that PARR SALES CO. 1289 1286 Findings section 2 (c) of the Qlayton Act, as amended by the Robinson-Patman Act, has been violated by the respondent, now makes this its findings as to the facts and its conclusion drawn therefrom. FINDINGS AS TO THE FACTS PARAGRAPH 1. Tanner-Brice Co., Inc., a corporation, organized and existing under and by virtue of the laws of the State of Georgia, with its principal office and place of business located at Vidalia, Ga., is engaged in a general wholesale merchandise business. PAR. 2. The respondent, Mitchell F. Brice, an individual residing in the city of Vidalia, Ga., is now and has been since June 19, 1936, president, secretary-treasurer, director, and stockholder in Tanner- Brice Co., Inc.

PAR. 3. The Parr Sales Co. is a firm engaged in the brokerage business with an office and place of business in Vidalia, Ga., and is owned by respondent Mitchell F. Brice and Francis K. Graham. Said Francis K. Graham is a former employee of the Tanner-Brice Co., he., aud is now employed by the said Mitchell F. Brice to render !:.ervices to various other enterprises owned and controlled by tespondent Mitchell F. Brice.

PAR. 4. Tanner-Brice Co., Inc., places orders for a substantial portion of the goods, wares· and merchandise, particularly food stuffs, required in the ordinary conduct of its business with sellers, who are in most cases located in States of the United States other than the State which said Tanner-Brice Co., Inc., is located, through the brokt~rage firm of Mitchell F. Brice and Francis K. Graham, trading as the Parr Sales Co. As a result of the transmission and execution of said orders as aforesaid goods, wares and merchandise, particularly food stuffs, are, in the case of each such order and in a continuous succession of such orders, sold, transported, and delivered by one or more of such sellers across State lines to the Tanner-Brice Co., Inc. par. 5. In the course and conduct of the buying and selling transactions, hereinabove referred to, resulting in the transportation anJ delivery of goods, wares and merchandise, particularly food stuffs, in interstate commerce from one or more sellers to said Tanner-Bric~ Co., Inc., sellers have transmitted and paid, and do transmit and pay, to the brokerage firm of 'Mitchell F. Brice and Francis K. Graham, trading as the Parr Sales Co., brokerage fees or commissions, the same being a certain percentage (usually from 272 percent to 5 percent) of the sales prices of such purchases. Since June 19, 1936, and while respondent Mitchell F. Brice owned and controlled 83 percent of the outstanding capitnl sto<'k and actively Order 31F.T.U.

managed and conducted the business of the said Tanner-Brice Co., Inc., sellers have paid brokerage fees and commissions to, and the same have been received by, the brokerage firm of Mitchell F. Brice and Francis K. Graham, trading as Parr Sales Co., upon the purehases of Tanner-Brice Co., Inc., in the manner hereinabove described in substantial amounts.

PAR. 6. In all of the transactions of purchase and sale hereinabove referred to since June 19, 1936,,the.res.pondJ:)nt Mitchell F, .. Bdce has been the agent and acted in fact for, an'd· in 'behalf of,· the Tanner. Brice Co., Inc.

PAR. 7. A substantial amount of the brokerage fees and commissions received by the brokerage firm of Mitchell F. Brice and Francis K. Graham, trading as Parr Sales Co., in the manner aforesaid since June 19, 1936, has been paid to Francis K. Graham as compensation for services rendered by Francis K. Graham in his respective capacities as an employee of the various enterprises owned and controlled by respondent Mitchell F. Brice.

CONCLUSION In accepting and receiving brokerage fees or commissions, the same being a certain percentage (usually from 2¥2 percent to 5 percent) of the sales prices upon purchases of commodities of the Tanner-Brice Co., Inc., in interstate commerce as set forth in the foregoing findings as to the facts, the respondent Mitchell F. Brice, individually and while trading under the firm ,name and style of Parr Sales Co., violated the provisions of section 2 (c) of the Clayton Act as amended by the Robinson-Patman Act.

ORDER TO CEASE AND DESIST This proceeding having been heard by the Federal Trade Commission upon the complaint of the Commission ·and substitute answer of respondent, in which answer respondent admits all the material allegations of fact set forth in said complaint and states that he waives all intervening procedure and further hearings as to. said facts, and the Commission having made its findings as to the facts and conclusion that said respondent •has violated the provisions of section 2 (c) of the Clayton Act as amended by the Robinson-Patroan Act, approved June 19, 1936 (U.S. C. title 15, sec. 13). It is ordered, That in purchasing commodities in interstate commerce the respondent, l\Iitc11ell F. Brice, indi:vidually, and trading under the firm name and style of Parr Sales Co., or any other name, his agents, employees, and representatives, directly or through any corporate or other device, do forthwith cease and desist from: PARR SALES CO. 1291 1286 Order 1. Accepting from sellers directly or indirectly on purchases of commodities of the Tanner-Brice Co., Inc., any brokerage fees or commissions or any allowance or discount in lieu of brokerage in whatever manner or form said brokerage fees, allowances, and discounts may be offered, allowed, granted, paid, or transmitted; and 2. Accepting from sellers in any manner or form whatever, directly or indirectly, anything of value as a commission, brokerage, or other compensation or any allowance or discount in lieu thereof upon purchase of commodities made for respondent's own account. It i<J further ordered, That the said respondent Mitchell F. Brice shall within 60 days after service upon him of this order file with the Commission a report in writing setting forth in detail the manner and form in which he has complied with the order to cease and desist hereinabove set forth by the Commission.

Syllabus 31 F. T. C.