Federal Trade Commission v. Gratz 253 U.S. 421 (1920)
FEDERAL TRADE COMMISSION v. GRATZ 253 U.S. 421 (1920)
Section 5 of the federal trade commission act outlawed, but did not define, "unfair methods of competition." Justice james mcreynolds, for a 7–2 Supreme Court, upheld a contract exclusively binding customers to one supplier. Confining Federal Trade Commission (FTC) orders against unfair methods to those previously found illegal (a holding reversed in 1934), the courts, not the commission, were henceforth to determine what section 5 meant. Justice louis d. brandeis, joined by Justice john h. clarke, dissented. They would have voided this practice, contending that "the Act left the determination to the Commission." They agreed that courts might determine whether—based on FTC findings—a practice was unfair, but they cautioned against overturning commission decisions without substantial reason.