Aristo Hosiery Company

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COMPL..4.INT IN THE l\IATTER OF Tile ALLEGED VIOLATION OF SF.CTION G OF AN ACT OF CONGRESS APPROVED SEPTEMBER 26; 1014. Docket 685-April 11, 1()~3.

SYLLABUS.

Where a corporation engaged in the sale nt wholesale of hosiery, in competition with concems who either correctly branded, labeled, and advertised their products with reference to composition, or failed to brand, label, and advertise the same at all in that respect, sold hosiery composed of cotton and wool in approximately equal proportions labeled, branded, and advertised as "worsted ribbed hose," "wool fashioned hose," "women's black cashmere hose," "fashioned cashmere hose," "women's black wool hose fashioneu," and "Indies' high graue cashmere": thereby rnisleacling a substantial part of the purchasing public into believing said goous to be composed of wool:

Held, That the sale of goods labeled, branded, and advertised as above set forth constituted nn unfair methou of competition. COMPLAINT.

The Federal Trade Commission, having reason to believe from a preliminary investigation made by it that the Aristo Hosiery Company, hereinafter referred to as respondent, has been and is using unfair methods of competition in violation of the provisions of Section 5 of an Act of Congress approved September 26, 1014, entitled "An Act to create a Federal Trade Commis::.ion, to define its powers an<.l duties, and for other purposes," and it appearing that a proceeding by it in respect thereof would be to the interest of the public, issues this complaint, stating its charges in this respect on information and belief as follows:

PARAGRAPH 1. That the respondent is a corporation organized and existing under the laws of the State of New York, with its principal place of business in the city of New York, in said State. PAR. 2. That respondent is engaged in the business of manufacturing ..and selling hosiery, and causes hosiery sold by it to bt3 transported to the purchasers thereof, from the State of New York; through and into other States of the United States, and carries on such business in direct, active competition with other persons, partnerships, and corporations similarly engaged, ARISTO HOSIERY CO. 85 84 Findings. PAR. 3. That respondent, in the course of its business as described in paragraph 2 hereof, places or causes to be placed upon hosiery sold by it, made of cotton and wool in approximately equnl proportions, and upon the boxes in which such hosiery is eventually offered for sale by the retail dealers to the purchasing public certaill :false and deceptive labels, among which are the following: "Worsted Ribbed Hose," " 1Vorsted Fashioned Hose," " 1Vool Fashioned Hose," "1Vomen's Black Cashmere Hose," " Black Cashmere," "Fashioned Cashmere Hose," "1Vomen's Black 1Vool Hose Fashioned,"" Ladies' High-Grade Cashmere"; which labels are false and misleading and are calculated to and do mislead and deceive the purchasing public.

PAR. 4. That by reason of the facts recited, the respondent is using an unfair method of competition in commerce, within the intent and meaning of Section 5 of an Act of Congress, entitled "An Act to create a Federal Trade Commission, to define its powers and duties, and for other purposes," approved September 26, 1914. REPORT, FINDINGS AS TO THE FACTS, AND ORDER. Pursuant to the provisions of an Act of Congress approved September 26, 1914, the Federal Trade Commission issued and served a complaint upon the respondent, Aristo Hosiery Company, charging it with the use of unfair methods of competition in commerce, in violation of the provisions of said act.

The respondent having entered its appearance in its own proper person and filed its answer herein, admitting all the allegations of ihe complaint and each count and paragraph thereof, and having made, executed, and filed an agreed statement of facts, in which it is stipulated and agreed by the respondent that the Federal Trade Commission shall take such agreed statement of facts as the facts in this case and in lieu of testimony, and proceed forthwith with such agreed statement of facts to make its findings as to the facts and such order as it may deem proper to enter therein without the introduction of testimony or the presentation of argument in support of same, and the Federal Trade Commission, having duly considered the record and being now fully advised in the premises, makes this its report stating its finding as to the facts and conclusion.

FINDINGS AS TO THE FACTS.

PARAGRAPH 1. That the respondent, Aristo Hosiery Company, is a corporation duly incorporated and doing business under and by Virtue of the laws of ~he State of New York, with its principal place of business in the city of New York, State of New York. 86 FEDERAL TRADE COMMISSION DECISIONS. Findings. 6F.T.C.

PAR. 2. That the respondent is engaged in the business of selling hosiery, and in causing such hosiery, when sold, to be shipped and transported from the State of New York through and into other States of the United States pursuant to such sales. PAR. 3. That the respondent, prior to March 1, 1!)20, in the conduct of its business as described in paragraph 2 above, sold and shipped hosiery made of cotton and wool in approximately equal proportions, labeled, advertised, and branded, and in packages or containers labeled, advertised, and branded" ·worsted Ribbed Hose," and" \Vool Fashioned Hose," and" \Vomen's Black Cashmere," and " Fashioned Cashmere Hos('," and "\Vomen's Black \Vool Hose Fashioned," and "Ladies' High Grade Cashmere." That neither the said hosiery nor the boxes containing it were labeled, advertised, or branded with any other word or w·ords to indicate the character, kind, or grade of material or materials entering into the manufacture of said hosiery. That some retail dealers purchasing this hosiery from respondent, or from respondent's customers, labeled, advertised, and branded as aforesaid, place it and display it on their shelves in the packages or containers, labeled and branded as aforesaid, and sell said hosiery to the purchasing public from said boxer;;. PAR. 4. That the word" Worsted," when applied to hosiery without any other word or words descriptive of the kind or grade of materials, signifies and is understood by a substantial part of the purchasing public to mean hosiery which is made entirely of wool. That the word "\Vool," when applied to hosiery v·:without any other word or words descriptive of the kind or grade of materials, signifies and is understood by a substantial part of the purchasing public to m('an hosiery made entirely of wool. That the word "Cashmere," when applied to hosiery without any other word or words descriptive of the kind or grade of materials, signifies and is understood by n substantial part of the purchasing public to mean hosiery made entirely of a high-grade wool.

PAR. 5. A number of respondent's competitors, in the selling of hosiery, are engaged in interstate commerce selling and shipping their goods from one State into another. That a number of such competitors have sold and shipped, and now sell and ship in said commerce between the States, hosiery which is made entirely of wool, which hosiery and the packages or containers of which are labeled, advertised, and branded "\Vorsted." That a number of such competitors have sold and shipped, and now sell and ship in commerce between the States, hosiery which is made entirely of wool, which hosiery and the packages or containers of which arc labeled, advertised, and branded "'Vool." That a number of such ARISTO HOSIERY CO. 87 84 Order. competitors have sold and shipped and now sell and ship in commerce between the States, hosiery which is made entirely of a highgrade wool, which hosiery and the packages or containers of which are labeled, advertised, and branded "Cashmere." PAn. 6. That a number of respondent's competitors,· engaged in interstate commerce as aforesaid, have sold and shipped and now sell and ship, hosiery which is made of wool and cotton in approximately equal proportions, which hosiery and the packages or containers of which are labeled, advertised, and branded with the words "'Vool and Cotton," or " 'Vorsted and Cotton," or " Cashmere and Cotton," or with no word or words descriptive of the materials. PAn. 7. The labels or brands under which the respondent sells, advertises, and ships hosiery, as set forth in the foregoing findings, tend to and do mislead and deceive a substantial part of the purchasing public as to the composition of materials of said hosiery; said labels or brands as so used by respondent cause said hosiery to compete unfairly with goods of its competitors in interstate commerce, who, as set forth in paragraphs 5 and 6 above, sell hosiery made entirely of worsted, wool, wool and cotton, worsted and cotton, or .cashmere and cotton; or hosiery made wholly or in part of other materials than those named, and labeled or branded so as to indicate the true composition thereof, or not labeled or branded by any words descriptive of the composition thereof.

CONCLUSION.

The practices of the said respondent, under the conditions and circumstances described in the foregoing findings, are unfair methods of competition in interstate commerce and constitute a violation of the Act of Congress approved September 26, 1914, entitled "An Act to create a Federal Trade Commission, to define its powers and duties, and for other purposes."

Onder TO CEASE AND DESIST.

This proceeding having been heard by the Federal Trade Commission, upon the complaint of the Commission, the answer of the respondent, and the statement of facts agreed upon by the respondent and counsel for the Commission, and the Commission having made its findings as to the facts with its conclusion, that the respondent has violated the provisions of the Act of Congress approved September 26, 1914, entitled "An Act to create a Federal Trade Commission, to define its powers and du~ies, and for other purposes," 88 FEDERAL TRADE COMMISSION DECISIONS, Order. 6F.T.C.

It i.~ now oraerea, That the respondent, Aristo Hosiery Company, and its officers, agents, representatives, servants, and employees, cease and desist from directly or indirectly: 1. Using as labels or brands on hosiery sold by it, or on the containers thereof, or in advertisements thereof, the word "Cashmere," (1) unless the hosiery so labeled, brandeu, or advertised be composed entirely of wool of a high grade, or· (2) unless, when the hosiery is composed partly of cashmere it is accompanied by a word or words aptly and truthfully describing the other material or materials of which the hosiery is in part composed.

2. Using as labels or brands on hosiery sold by it, or on the containers thereof, or in advertisements thereof, the word "·wool," ( 1) unless the hosiery so labeleu, branded, or advertised be composed entirely of wool, or (2) unless, when the hosiery is composed partly of wool, it is accompanied by a word or words aptly and truthfully describing the other material or materials of which the hosiery is in part composed.

3. Using as labels or brands on hosiery sold by it, or on the containers thereof, or in advertisements thereof, the word " ·worsted," (1) unless the hosiery so labeled, branded, or advertised be composed partly of wool, it is accompanied by a word or words aptly and truthfully describing the other material or materials of which the hosiery is in part composed.

Respondent is further orderea, To file a report in writing with the Commission sixty (60) days from notice hereof, stating in detail the manner in which this order has been complied with and conformed to. AMERICAN FILM CO. 89 Complaint.

FEDERAL TRADE COMMISSION v.

AMERICAN FILM COMPANY.