Viewing page 13 of 116

This transcription has been completed. Contact us with corrections.

- 12 -

adverse to the public interest, (2) whether the terms of the Colonial-Eastern acquisition agreement are not consistent with the public interest, and (3) if the acquisition is to be approved, what terms and conditions, if any, should be attached and what modifications, if any, should be prescribed.

Eastern's Prior Control of Colonial - It is National's contention that a carrier should not, consistent with a sound program of law enforcement, be permitted to keep the fruits of illegal acts, and that the prior finding of the Board in the Eastern-Colonial Acquisition Case, supra, that Eastern, without first securing Board approval, had obtained control of Colonial precludes approval of the present agreement.

The contention of National that the law violator should not be regarded with the fruits of such violation is well taken. The Board has adhered to this belief on prior occasions. In the Bryant-Capital Airlines Interlocking Relationship Case, 7/ the Board stated that:

"We take this occasion to inform all persons coming within section 409 of the Act that the establishment or maintenance of interlocking relationships within the scope of section 409 of the Act without prior Board approval is a violation of the Civil Aeronautics Act. Such violations will be considered in determining whether approval of such interlocking relationships will be adverse to the public interest. The violation shall be accorded such weight as the factual situation may warrant and under ordinary circumstances would be inimical, if not fatal, to the application for approval of the realtionship."


7/ Bryant-Capital Airlines Interlocking Relationships Case, Docket No. 3305, Order Serial No. E-3686, dated December 7, 1949. 

Transcription Notes:
[[underlined]] removed per Smithsonian instructions