Proposed promotional allowance program based on pyramiding sales of customers rejected
73 F.T.C. 1331 · May 7, 1968 · Digest No. 241
source volume section (73 F.T.C. 1331)
Text is machine-OCR of the printed volume and may contain errors. Advisory opinions are the Commission's views on proposed conduct, not binding orders.
No. 241. Proposed promotional allowance program based on pyramiding sales of customers rejected.
The Commission advised a requesting party that yiolation of Section 5 of the Federal Trade Commission Act ,youlc1 result from the adoption of a proposed sales promotion plan described in essence as follmys:
\ c(,l'tn1n sum of m()jH' ~' \'\cmlc1 be l'esE'l'\' rd from the proceeds of sale to a first customer. That customer, if he wished to participate in t he sales promotion program would be. paidllp to one quarter of the 1't'SelT('(l SU111 11S commission on sales to ten additional customers. TIle' first customer ,,"ould also be paid up to one. quarter of the, reseryed SUIll on snles made by his customers to ~Tet another generation of customers and so thrOllQ:h a fourth !2'eneration.c.The tabulation distributed to potential purchasers of the request.. c. ing party s merehandise sho\yec1 that the original participant , in theory. mip:ht brnefit from the efforts of 11.100 sa lrspersons. 1"11jsin the Commission s judp:nwnt ,yas be~70nd the realm of possibility. The return to any given participant wouldunquestionabl~7 be a Q,Teat deal less than the theoretically achirynble amount set forth: more often than not it would he negligible. The initia purchaser ",,"ould not surely benefit beyond that amount. if any. ,yhich he, can Q:ain through his own efforts. Any rurther amount which he mii!'ht receive would acerue to him sheerly through chance. (File X o. 683 7116 released IHay 7 1968.
No. 2~12. Necessity for disclosing the country of origin of irn:ported ink.
The Commission was requested to render an ach-isory opinion with rep.:al'd to the necessity for disclosinQ' the foreign origin or ink 'which is imported from Germany. The ink is imported in 50 liter drums 311: and :2 ounee bottles.and resold to the consumer in The opinion advised that in the Commission s view the country or origin of this ink must be disclosed in a clear and conspicuous manner on the bottles in which it is sold and, if the ink is packaged in separate boxes, on the boxes themselves in such a manner as to be readily seen by prospective purchasers. The opinion added that neither directly nor indirectly could it be implied that the ink is manufactured in the United States. (File No. 683 7114, released :May 7, 1968.