Philippine Mahogany Case

By \flalter G. Scrim

An address made at the Annual Convention of the Pacific Coast V/holesale Hardwood Distributors Association, held at Del Monte, Calif., April 28,29 ond 30, 1938

Wolter G. Scrim

l-rad to inform you that we long investigation.

When your President asked me to make a report on the "Philippine Mahogany Case" at this convention. I felt that I was in a rather difficult position on account of the present situation as to our status before the Federal Trade Commission. If this meeting had been held one month later, I would have been in a position to tell you that the rnatter had been cleared up for all time and that we were within our rights in calling this lvood "Philippine Mahogany", or I would have had again to go through another

You all knorv, of course, that we have been continuously fighting this case for 13 years. Back in 7925, the Mahogany Association initiated this trade fight. I feel that I am quite right in calling it a "trade fight" because no other interests have appeared except those of the Mahogany Association and the Philippine Mahogany industry.

As I say, the case started back in 1925, and after the trial of two cases, which cost the industry probably $200,000, we got a favorable decision in 1931, under which it was held that Philippine Mahogany was the proper name for the wood.

In 1934, through death and resignations, three new men had been appointed to the Federal Trade Commission. The Mahogany Association renewed the fight and filed a petition to reopen this case. This case we briefed and argued in 1935, and the Commission did not reopen it.

In October, 1937, the Mahogany Association put forth pressure on the Commission to reopen it, with the result that we had again to brief the question as to the right of the Commission to reopen, and final argument will be held on May 25. That is why, had this meeting been held one month later, I would have been able to give you more definite information.

The attempts of the Mexican and African Mahogany interests to reopen this case has been merely an attempt to perpetuate a nasty trade fight. That this is being done in bad faith is shown by the fact that two of the largest of these importers are making nice profits from the sale of Philippine Mahogany. and it is notable that thev use the terms "Philippine Mahogany" in selling our wood.

That really is the history of the case in a nrrtshell. brrt T believe that for the information of many of those present who have not been connected '*'ith or interested in this case until very lately, it is in order to briefly run over the history of the so-calied "Philippine Mahogany Case.,'

In February, 1925, at the instigation of the members of the Mahogany Association, the Federal Trade Commission issued a complaint against Thomas E. Powe. Shortly thereafter, they issued complaints against the Indiana Quartered Oak Co., James Hardwood Co., Pacific Southwest Import Co., Kirschmann Hardwood Co., Hammond Lumber Co., and Robert Dollar Co. The Commission elected to try the case against the Indiana Quartered Oak Co. After the Commission had traveled all over the country and taken evidence, most of it what we called at that time "evidence from their butter and egg \Mifns55s5"- sn August L6, 1927, they entered an order to cease and desist. This meant, of course, that the seven parties against whom complaints had been issued were prevented from selling our wood as Philippine Mahogany.

In 1929, various concerns, not parties to the above case, stated to the Commission that they believed the findings in the Indiana Quartered Oak Co. case were erroneous and did not disclose the real facts. These dealers petitioned the Commission to institute proceedings against one of their number in order that a more complete disclosure of the facts regarding the matter might be obtained.

On December 14, l9D, the Commission filed a new complai.nt against the Gillespie Furniture Co. This is the proceedings which was made the test case;6,747 pages of testimony were taken in this case. At about this time, the Commission issued complaints against other respondents, numbering some 14 dealers in Philippine Mahogany, among whom were such well known firms as E. J. Stanton & Son, Western Hardwood Lumber Co., Cadwallader-Gibson Co., and Black & Yates. Again the Commission traveled all over the countrv taking evidence, and the Philippine Mahogany interests, their counselors, and many of their interested friends, were put to the expense of traveling all over the conntry bringing forward witnesses and providing concrete evidence.

On -fune 8, 1931, the Commission decided the "Pine Case," rvith the result of rvhich you are all familiar. in that the dealers in California Pine could not call their lumber White Pine. but had to change the name to Ponderosa.

I u'ant vou to note these dates:

C)n June 8, 1931, the Corrmission decided aqainst the pine people; on June 10. 1931. two days later, the Commission dismissed the Gillesoie case.

Tu'o months after the dismissal of the Gillespie case. that is. September. 1931. the Mahoganl' Association petitioned the Commission to intervene and move for a rehearing of the Gillespie case, citing as its principal reason that there was a discrepancy between the Commission's decision in the White Pine case and in the Gillespie case. This petition was denied.

On September D, 1931, on behalf of the respondents in the Gillespie case, amounting to some 13, a motion was made to dismiss the complaints in these cases based on the result of decision of the test case against Gillespie, because it had been agreed that result of the Gillespie case would govern the decision of the remainder of the respondents. These respondents did not ask merely for a dismissal of the proceedings against them, but made an effort to cooperate lvith the Commission in making use of this test case as a final dismissal of the Mahogany case and to that end offered to sign a stipulation whereby they agreed not to sell, describe or advertise the wood of the Philippine fslands, or aricles made therewith, without using the word "Philippine" in conjunction with the word "Mahogany".

Up to this time, it had cost the Philippine Mahogany industry over $200,000, and probably had cost the Government a similar amount.

On October 21, 1931, certain African Mahogany dealers, rvho we believe are largely responsible for this whole situation, again moved through the Mahogany Association to intervene in these 13 untried cases. On November 5. 1931. the Commission denied this petition to intervene.

We. of course, thought after the Gillespie case had been decided, and after the Commission had twice refused to allow the intervention of the Mahogany Association or members of the Mahogany Association, that our troubles were over, and we immediately started to do some advertising work. Members of the industry, having faith in the Federal Trade Commission, naturally supposed the matter was closed for all time. However, the Mahogany Association immediately started circulating propaganda to weaken our standing with the trade and rvith the public.

Naturally, I can only to,uch on the high spots of this case, for as I stated, there were over 6,7ffi pages of evidence taken in the Gillespie case, and I have in my files four volumes of about 700 pages each taken in the original, or Indiana Ouartered Oak Co. case. If anybody is interested in reading any of this, I will be glad to let them have it.

In October of last year, the Mahogany Association again put forth pressure on the Commission to reopen the Gillespie case. Since October until a short time ago, our attorneys have been preparing briefs to show cause why the Commission should not allow the case to be reopened. Our attorneys have briefed this case and shown in a very few words why the case should not be opened, principally, on the grounds of contending that the Commission is without power or jurisdiction to reopen this proceeding.

BEN JOHNSON HEADS PICKERING LUMBER CORP.

Ben Tohnson, formerly in the banking business in Shreveport and Marshficld, La., has succeeded D. H. Steinmetz as president and general manager of the Pickering Lumber Corporation, Standard, Calif.

J. C. Rassenfoss is vice-president ancl resident manager of the conrpany.

Il. D. Hamacher is sales manager.

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