254 DOUGLAS, J., dissenting. 342. By § 13 (4) of the Act, the Commission is empowered to regulate intrastate rates which are found to be discriminatory. The key to this regulatory authority is discrimination against interstate commerce, which presupposes that somehow or other the particular intrastate rates interfere with or prejudice interstate commerce. This principle is explicit in § 13 (4) and in the decisions. of the Court, both before and after the enactment of § 13 (4).3 1 2 1 As Mr. Justice Hughes speaking for the Court in the Shreveport case said (234 U. S., p. 351): "Congress is empowered to regulate,— that is, to provide the law for the government of interstate commerce; to enact 'all appropriate legislation' for its 'protection and advancement' (The Daniel Ball, 10 Wall. 557, 564); to adopt measures 'to promote its growth and insure its safety' (County of Mobile v. Kimball, supra); 'to foster, protect, control and restrain' (Second Employers' Liability Cases, supra). Its authority, extending to these interstate carriers as instruments of interstate commerce, necessarily embraces the right to control their operations in all matters having such a close and substantial relation to interstate traffic that the control is essential or appropriate to the security of that traffic, to the efficiency of the interstate service, and to the maintenance of conditions under which interstate commerce may be conducted upon fair terms and without molestation or hindrance." 2 The relevant portions of § 13 (4) read: "Whenever in any such investigation the Commission, after full hearing, finds that any such rate, fare, charge, classification, regulation, or practice causes any undue or unreasonable advantage, preference, or prejudice as between persons or localities in intrastate commerce on the one hand and interstate or foreign commerce on the other hand, or any undue, unreasonable, or unjust discrimination against interstate or foreign commerce, which is hereby forbidden and declared to be unlawful, it shall prescribe the rate, fare, or charge, or the maximum or minimum, or maximum and minimum, thereafter to be charged, and the classification, regulation, or practice thereafter to be observed, in such manner as, in its judgment, will remove such advantage, preference, prejudice, or discrimination. . . ." 3 See Shreveport Rate Case, supra; American Express Co. v. South Dakota, 244 U. S. 617; Wisconsin Commission v. Chicago, B. & DOUGLAS, J., dissenting. 344 U.S. In this case there is no rational relation between intrastate freight rates and interstate passenger operations. The present level of freight rates in Florida neither hampers nor obstructs the free flow of interstate passenger transportation. They do not affect its quantity or flow. There is, therefore, no basis for a finding of discrimination against interstate commerce. The Commission, of course, is authorized to regulate intrastate rates so that intrastate operations will provide a fair share of the carriers' revenue. See Wisconsin Commission v. Chicago, B. & Q. R. Co., 257 U. S. 563. But that authority rests on the Commission's power to remove discrimination. If, for example, intrastate freight operations fail to produce an adequate return as determined by reference to the cost of the intrastate operations and the investment in the intrastate business, interstate commerce is discriminated against. But there is no such failure in this case. Intrastate freight operations in Florida are amply profitable and carry their fair share of the load. The Commission nevertheless has saddled the intrastate freight business with the deficits from the interstate passenger business. If there is any discrimination here, it is against the local Florida shipper. Q. R. Co., 257 U. S. 563; Florida v. United States, 282 U. S. 194; Georgia Commission v. United States, 283 U. S. 765; Louisiana Commission v. Texas & N. O. R. Co., 284 U. S. 125; United States v. Louisiana, 290 U. S. 70; North Carolina v. United States, 325 U. S. 507. * Section 15a (2) of the Act reads in pertinent part: "In the exercise of its power to prescribe just and reasonable rates the Commission shall initiate, modify, establish or adjust such rates so that carriers as a whole... will, under honest, efficient and economical management and reasonable expenditures for maintenance of way, structures and equipment, earn an aggregate annual net railway operating income equal, as nearly as may be, to a fair return upon the aggregate value of the railway property of such carriers held for and used in the service of transportation . . . 254 DOUGLAS, J., dissenting. The Commission surmises but does not find that the intrastate passenger rates contribute to the passenger deficits of the carriers. But there is no showing that either the intrastate passenger rates or the intrastate freight rates do in fact contribute to these deficits. Moreover, even if we assume that intrastate passenger rates do contribute to the passenger deficits, we do not know the amount. The absence of these material findings (see North Carolina v. United States, 325 U. S. 507) indicates to me the short cut which the Commission is taking to enlarge its jurisdiction to unprecedented limits. 226612 O-53--23 STEELE ET AL. v. BULOVA WATCH CO., INC. CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT. No. 38. Argued November 10, 1952.-Decided December 22, 1952. Under the Lanham Trade-Mark Act of 1946, 15 U. S. C. § 1051 et seq., a federal district court has jurisdiction to award relief to an American corporation against acts of trade-mark infringement and unfair competition consummated in a foreign country by a citizen and resident of the United States who purchases parts here and some of whose products, sold abroad, enter this country where they may reflect adversely on the American corporation's trade reputation. Pp. 281-289. (a) It is not material that the infringing trade-mark was affixed in a foreign country, or that the purchase of parts in this country, when viewed in isolation, did not violate any law of the United States. P. 287. (b) American Banana Co. v. United Fruit Co., 213 U. S. 347, distinguished. Pp. 288-289. (c) Where there can be no interference with the sovereignty of another nation, the district court, in exercising its equity powers, may command persons properly before it to cease or perform acts outside its territorial jurisdiction. P. 289. 194 F. 2d 567, affirmed. A Federal District Court dismissed a suit for injunctive and monetary relief brought by an American corporation against a citizen and resident of the United States for acts of trade-mark infringement and unfair competition consummated in Mexico. The Court of Appeals reversed. 194 F. 2d 567. This Court granted certiorari. 343 U. S. 962. Affirmed, p. 289. Wilbur L. Matthews argued the cause and filed a brief for petitioners. 280 Opinion of the Court. Marx Leva argued the cause for respondent. With him on the brief were Alexander B. Hawes, A. Lloyd Symington, Sanford H. Cohen, George Cohen, Isidor Ostroff and Maury Maverick. MR. JUSTICE CLARK delivered the opinion of the Court. The issue is whether a United States District Court has jurisdiction to award relief to an American corporation against acts of trade-mark infringement and unfair competition consummated in a foreign country by a citizen and resident of the United States. Bulova Watch Company, Inc., a New York corporation, sued Steele,1 petitioner here, in the United States District Court for the Western District of Texas. The gist of its complaint charged that "Bulova," a trade-mark properly registered under the laws of the United States, had long designated the watches produced and nationally advertised and sold by the Bulova Watch Company; and that petitioner, a United States citizen residing in San Antonio, Texas, conducted a watch business in Mexico City where, without Bulova's authorization and with the purpose of deceiving the buying public, he stamped the name "Bulova" on watches there assembled and sold. Basing its prayer on these asserted violations of the trade-mark laws of the United States, Bulova requested injunctive and mone 1 Joined as parties defendant were S. Steele y Cia., S. A., a Mexican corporation to whose rights Steele had succeeded, and Steele's wife Sofia who possessed a community interest under Texas law. 2 While the record shows that plaintiff fully relied on his asserted cause of action "arising under" the Lanham Act, diversity of citizenship and the jurisdictional amount were also averred. As we are concerned solely with the District Court's jurisdiction over the subject matter of this suit, we do not stop to consider the significance, if any, of those averments. Cf. Pecheur Lozenge Co. v. National Candy Co., 315 U. S. 666 (1942), decided prior to passage of the Lanham Act. See also note 6, infra. |