Sci-Iool Ser.Vices Inc

Text (OCR of the scan; may contain errors)

It is respondents contention that the emphasized references to advertisements offering “college educations in five weeks” and “becoming an airline’s hostess by attending a charm school” were “unmistakenly an allusion to the allegations in the present case.” They request that I withdraw for the reason that my remarks reflect prejudgment of the issues or, if I have not prejudged the issues, that I should withdraw to assure the appearance of complete fairness in this proceeding. In the first place, respondents’ assertion that the advertising representations used as examples in my remarks “unmistakenly” allude to the allegations in this matter is completely without foundation. Indeed, respondents make no attempt to show any correlation between the charges before the Commission and niy remarks. My reference was to claims for a college education in five weeks, but there is no allegation in the complaint. that respondents’ courses are limited to such a time. period. In fact, the examiner's decision, which issued before my remarks were made, states that respondents’ courses extend for an appreciably longer period of time. The reference to advertising representations that a person may become an airline hostess by attending a charm school is likewise not related to any questions involved in this case at the time my remarks were made, The complaint is directed in part at the respondents’ alleged advertising claims that one of their specific courses of instruction qualifies students to be airline stewardesses. The issue before the Commission, however. is not the truth or falsity of such claim? but whether cr not respondents have made the alleged representation. And this, obviously, is not a matter to which my remarks were directed.

In referring to the advertising representations mentioned in my remarks, I had no particular case in mind. J merely listed certain principles in advertising which. based on my judgment and experience, would indicate a possible breach of acceptable standards. In my opinion, this matter falls squarely within the holding of the Supreme Court in the Cement Institute case.? In that case, the Commission issued a formal complaint based on an earlier investigation of the basing point system as used in the cement industry, Prior to complaint, the Commission had reported to Congress that the industry’s basing point system was a price fixing device and was unlawful under the Sherman Act and the Federal Trade Commission Act. In denying respondents’ motion for disqualification of the Commission. the Supreme Court stated that:

Neither the Tumey Gecision nor any other decision of this Court would require us to hold that it would he a violation of procedural due process for a judge to sit in a case after he had expressed an opinion as to whether certain types 1The parties stipulated that none of respondents students. merely hecause ther had completed a course of instruction in Cinderella Career Colleze & Finishing School. quality for a job as an airline stewardess (Initial Decision, p. 40) [74 F.T.C. 920, 958-959] 2 Federal Trade Commission v, Cement listitute, 333 U.S. 688 (1948). of conduct were prohibited by law. In fact, judges frequently try the same case more than once and decide identical issues each time, although these issues involve questions both of law and fact. Certainly, the Federal Trade Commission cannot possibly be under stronger constitutional compulsions in this respect than a court. (833 U.S. at 702-703.) It is established law that the kind of personal bias that requires disqualification is that which has led to an irrevocably closed mind on the issues. On this point, the Supreme Court in the Cement Institute case has stated that:

In the first place, the fact that the Commission had entertained such views as the result of its prior er parte investigations did not necessarily mean that the minds of its members were irrevocably closed on the subject of the respondents’ basing point practices. Here, in contrast to the Commission's investigations, members of the cement industry were legally authorized participants in the hearings. They produced evidence—volumes of it. They were free to point out to the Commission by testimony, by cross-examination of witnesses, and br arguments. conditions of the trade practices under attack which they thought kept these practices within the range of legally permissible business activities. (333 U.S. at 701.) The court of appeals in commenting on this question of prejudice in Eisler vy. United States, 170 F. 2d 273 (D.C. Cir. 1948) has stated that “Prejudice, to require recusation, must be personal according to the terms of the statute, and impersonal prejudice resulting from a judge’s background or experience is not, in our opinion, within the purview of the statute.”

The issues in this case have been fully litigated and the record is before us. My decision on these issues will be based solely on the evidence in this record. If my decision is adverse to respondents, and Iam in the majority, respondents will have an absolute, statutory right to test, in the courts, whether the majority’s findings are supported by evidence.$ As to the “appearances” contention in respondents’ motion, I have stated in my memorandum refusing to withdraw from participation in Bakers of Washington, Docket $309 (November 4, 1964) [66 ETC. 1562, 1566], that this principle “is not a rigid command of the law, compelling disqualification for trifling causes, but a consideration addressed to the discretion and sound judgment of the administrator himself in determining whether, irrespective of the law’s requirements, he should disqualify himself.” The Supreme Court’s decision in the (ement Institute case, supra, makes it clear that an administrator’s duty is presumed, in the absence of clear proof to the contrary, to be not only regular in all respects but affirmatively in the public interest. 3 Section 5(c) of the Federal Trade Commission Act provides in part that any party “required hy au order of the Commission to cease and desist. . . may obtain a review of such order” in the appropriate court of appeals. “Upon such filing of the petition and transcript the court... shall have power to make and enter a decree affirming, modifying, or setting aside the order of the Commission... . The findings of the Commission as to the facts, if supported by evidence, shall be conclusive’ (emphasis added). As I further pointed out in my memorandum in the Bakers of Washington matter, this principle has been summed up in the statement of a recent commentator that “every adjudicator has a positive duty to fulfill his adjudicative functions unless actually disqualified, and both the individual parties to a controversy and the public at large have a vested interest in such administrator’s participation in the case involved. Consequently, while an administrator should scrupulously search his conscience to test his impartiality, it is almost as great a fault to employ self-disqualification too readily as too sparingly.” * I can state without reservation that I have scrupulously searched my conscience and that I have not prejudged the issues in this case, nor do I harbor any bias or prejudice against the respondents. My decision will be based entirely on the facts contained in the record. Accordingly, it is my decision not to withdraw from participation in this proceeding. i shall not participate in any deliberation or decision by the Commission on respondents’ alternate request.

Orver Denyine Morton to Dis@uaLiry Respondents, School Services, Inc., et al., by motion filed May 3, L1G8, requested that Chairman Dixon withdraw from further particisation in this proceeding, or, in the alternative, that the full Commission disqualify Chairman Dixon. Chairman Dixon, for the reasons stated in the attached memorandum, has decided not to withdraw from participation in any further proceedings in this matter. A tribunal which is asked to rule on the ability of one of its own members to make an objective and impartial judgment faces a most difienlé and delicate responsibility. This responsibility cannot be treated lightly.

Traditionally, the Commission has viewed requests for disqualification as a matter primarily to be determined by the individual member concerned, leaving it within the exercise of his sound and responsible discretion. This is only proper and consistent with the law and no basis for departing therefrom has been demonstrated in the instant proceeding. Accordingly, /t¢ is ordered, That the motion for disqualification of Chairman Dixon be, and it hereby is. denied.

By the Commission, with Chairman Dixon and Commissioner E]lman not participating.

7 ‘Prejudice and the Administrative Process,” 59 Northwestern Univ. L. Rev.