Interstate Distillers, Inc

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IN THE :MATTER OF INTERSTATE DISTILLERS, INC.

COMPLAINT, FINDINGS, AND ORDER IN REGARD TO THE ALLEGED VIOLATION OF SEC, 5 OF AN ACT'OF CONGRESS APPROVED SEPT. 26, 1914, AND OF SEC. 3 OF TITLE I OF AN ACT OF CONGRESS APPROVED JUNE 16, 1933 1 Docket 2372. Complaint, Apr. 22, 1935-Decision, Nov. 13, 1936 Where a corporation, engaged as rectifier of spirituous liquors, in purchasing, rectifying, blending, and bottling whiskies, brandies, rums, and other ~>pir­ ituous beverages, and in selling same in competition with those engaged In manufacture by distillation of whiskies and other spirituous beverages and in sale and distribution· thereof, and with other rectifiers and wholesalers, and owning no stills or other apparatus for the production of distilled spirits by original and continuous distillation from mash, wort, or wash- Uepresented, through use of word "Distlllers" in its corporate name, printed on its stationery and on the labels attached to the bottles in which lt sold and shipped its said products, and furnished its wholesale customers with the means of thus representing to retailers and to ultimate purchasers that said whiskies, brandies, and other spirituous beverages contained in such bottles were by it made through process of distillation, nowithstanding fact it was not a distiller and did not distill said whiskies or other liquors thus bottled, sold, and transported by it;

With tendency to mislead and deceive wholesalers, retailers, and ultimate purchasers into belief tllat in buying said liquors they were purchasing a product bottled at a distillery. by the original distlller thereof, as substantially Preferred by trade and public, and with effect of unfairly diverting tr.<.tde to it from its competitors, Including those who manufacture spirituous liquors by process of original and continuous distillation from mash, wort, or \~ash, and truthfully designate themselves as distilling companies, and those who, engaged solely as rectifiers, do not untruthfully designate themselves as "distilleries," "distillers," or "distilling companies": lield, That such acts and practices were to the prejudice of the public and competitors, and constituted unfair methods of competition. Defore 11/r. John lV. Bennett, trial examiner. Mr. PGad B. Morehouse and Mr. Dewitt T. Puckett for the Commission.

N~h & Donnelly, of Washington, D. C., for respondent. • Col\IPLAINT Pursuant to the provisions of an Act of Congress approved Sep· te~ber 26, 1914, entitled, "An Act to create a Federal Trade Com- ~lssion, to define its powers and duties, and for other purposes," the ~~ch~ral Trade Commission, having reason to believe that Interstate 18bllers, Inc., a corporation hereinafter referred to as respondent,1 las been and is using unfair methods of competition in commerce, as 1 Count 2 of the complaint, under National Industrial Recovery ,Act, dismissed.--- Complaint 23F. T.C.

"commerce" is defined in said act, and in violation of the act of Congress approved June 16, 1933, known as the "National Industrial Recovery Act", and it appearing to the said Commission that a proceeding by it in respect thereof would be in the public interest, hereby issues its complaint, stati11g its chargfls in that respect as follows: Count 1 PARAGRAPH 1. Respondent is a corporation organized, existing, and 1loing business under the laws of the State of Maryland, with its cfiice and principal place of business in Baltimore, in the said State. It is now and since its organization in 1934 has been engaged in the business .of purchasing, rectifying, blending, and bottling whiskies, brandies, rums, and other spirituous beverages and in the sale thereof in constant course of trade and commerce, between and among the various States of the United States, and in the District of Columbia. In the course and conduct of its said business, it causes the said products -when sold to be transported from its place of business in Baltimore, aforesaid, into and through various other States of the United States to the purchasers thereof consisting of wholesalers and retailers, some located within the State of Maryland and some located in other States of the United States and the District of Columbia. In the course and conduct of its business as aforesaid, respondent is no~ and at all times since its organization has been in substantial com· petition with other corporations and with individuals, partn£'rships and firms engaged in the manufacture by distillation of whiskies brandies, rums, and other spirituous beveragf's and in the sale thereoi in trade and commerce between and among ihe various States of the United States and in the District of Columbia; and in the course and conduct of its business as aforesaid, respondent is and has be:.>.n since its organization in substantial competition with other corporations and with individuals, firms, and partnerships engaged in the business of rectifying, blending, and bottling whiskies, brandies, rums, and other spirituous beverages and in the sale thereof in commcfrce between and among the various States of the United States and in the District of Columbia.

PAR, 2. For a long period of time the word "distillers" when used in connection with the liquor industry and with the products of such industry has had and still has a definite significance and meaning to the minds of wholesalers and retailers in such industry and to the ultimate purchasing public, to wit, individuals, partnerships or corporations who engage in the manufacture of such liquors by the process of distillation; and a substantial portion of the purchasing INTERSTATE DISTILLERS, INC. 839 837 Complaint Public prefers to buy spirituous liquors bottled by the actual distillers and manufacturers thereof.

PAR. 3. In the course and conduct of its business as aforesaid, by the use of the word "distillers" in its corporate name, printed on its stationery and on the labels attached to the bottles in which it sells and ships its said products, and in various other ways, respondent represents to its customers and fur11ishes them with the means of ~representing to their vendees, both retailers and the ultimate consum- Ing pub]jc, that the said whiskies, brandies, rums, and other spirituous beverages therein contained were by it manufactured through the Process of distillation, when, as a matter of fact the respondent is not a distiller, does not distill the said whiskies or other spirituous liquors by it so bottled, labeled, sold, and transported, and does not own, operate, or control a place or places where such beverages are manufactured by the process of distillation.

PAR. 4. There are among the competitors of respondent engaged in the sale of spirituous liquors as mentioned in paragraph 1 hereof, corporations, firms, partnerships, and individuals who manufacture and distill whiskies, brandies, rums, and other spirituous beverages i!old by them and who truthfully use the words "distillery," "distilleries," "distillers," or "distilling" as a part of their corporate names and on their stationery and on the labels of the bottles in Which they sell ancl ship such products. There are also among such competitors, corporations, firms, partnerships, and individuals engaged in the business of rectifying, blending, and bottling whiskies, brandies, rums, and other spirituous beverages who do not use the Words "distilleries " "distillery " "distillers " or "distillin a'' as a part ' ' "" of their corporate' names nor on their stationery nor on the labels attached to the bottles in which they sell and ship their said products. PAn. 5. The representation by respondent as set forth in paragraph 3 hereof, is calculated to and has a capacity and tendency to and does n1mislead and deceive dealers antl the purchasing public into the belief that the whiskies, brandies, rums, and other spirituous beverages sold by the respondent are manufacturetl and distilled by it and is calculated to and has the capacity and tendency to and does induce dealers and the purchasing public, acting in such belief, to purchase . the whiskies, brandies, rums, and other spirituous beverages rectified, blended, and bottled by the respondent, thereby diverting trade to respondent from its competitors who do not by their corporate name o: in any other mamier misrepresent that they are manufacturers by · distillation of whiskies, brandies, rums, and other spirituous hevera ges, and thereby respondent does substantial injury to subs tan I ial competition in interstate commerce.

Complaint 23F.T.C.

PAR. 6. The acts and things above alleged to have been done and the false representatioi1s alleged to have been made by respondent are to the prejudice of the public and the competitors of respondent and consitute unfair methods 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. Oount 1J PARAGRAPH 1. Respondent is a corporation organized, existing, and doing business under the laws of the State of Maryland, with its office and principal place of business in Baltimore, in the said State. It is now and since its organization in 1934 has been engaged in the business of purchasing, rectifying, blending, and bottling whiskies, brandies, rums, and other spirituous beverages and in the sale thereof in constant course of trade and commerce, between and among the various States of the United States, and in the District of Columbia. In the course and conduct of its said business, it causes the said prod· ucts when sold to be transported from its place of business in Balti· more, aforesaid, into and through various other States of the United States to the purchasers thereof consisting of wholesalers and retail· ers, some located within the State of Maryland and some located in other States of the United States and the District of Columbia. In the course and conduct of its business as aforesaid, respondent is no-w and at all times since its organization has been in substantial competi· tion with other corporations and with individuals, partnerships, and firms engaged in the manufacture by distillation of whiskies, brandies, rums, and other spirituous beverages and in the sale thereof in trade and commerce between and among the various States of the United States and in the District of Columbia; and in the course and conduct of its business as aforesaid, respondent is and has been since its organization in substantial competition with other corporations and with individuals, firms, and partnerships engaged in the busin~ss of rectifying, blending, and bottling whiskies, brandies, rums, and other spirituous beverages and in the sale thereof in commerce between and among the various States of the United. States and in the District of Columbia.

PAR. 2. As grounds for this paragraph of this complaint, the Fed· era! Trade Commission relies upon the matters and things set out in paragraph 2 of count 1 of this complaint to the same extent as though the allegations thereof were set out at length herein and said paragraph 2 of count 1 of this complaint is incorporated herein by INTERSTATE DISTILLERS, INC. 841 837 Complaint reference and adopted as the allegations of this paragraph of this count and is hereby charged as fully and as completely as though the several averments of said paragraph 2 of said count 1 were repeated verbatim.

PAR. 3. As grounds for this paragraph of this complaint, the Federal Trade Commission relies upon the matters and things set out in paragraph 3 of count 1 of this complaint to the same extent as though the allegations thereof were set out at length herein and said Paragraph 3 of count 1 of this complaint is incorporated herein by reference and adopted as the allegations of this paragraph of this count and is hereby charged as fully and as completely as though the several averments of said paragraph 3 of said count 1 were repeated 'Verbatim.

PAR. 4. As grounds for this paragraph of this complaint, the Fed- ~ral Trade Commission relies upon the matters and things set out In paragraph 4 of count 1 of this COID;plaint to the same extent as though the allegations thereof were set out at length herein and said Paragraph 4 of count 1 of this complaint is incorporated herein by reference and adopted as the allegations of this paragraph of this count and is hereby charged as fully and as completely as though the several averments of said paragraph 4 of said count 1 were repeated Verbatim.

PAn. 5. As grounds for this paragraph of this ~complaint, the Federal Trade Commission relies upon the matters and things set out in Paragraph 5 of count 1 of this complaint to the same extent as though the allegations thereof were set out at length herein and said paragraph 5 of count 1 of this complaint is incorporated herein by reference and adopted as the allegations of this paragraph of this count and is hereby charged as fully and as completely as though the several UYerments of said paragraph 5 of said count 1 were repeated verbatim. PAR. 6. Under and pursuant to Title I of the National Industrial Recovery Act, approved June 16, 1933 ( 48 Stat. 195 C. 90) the President of the United States, by Executive Order No. 6182, of June 26, 1933, as supplemented by Executive Order No. 6207, of July 21, 1933, and Executive Order No. 6345 of October 20, 1933, delegated to H. A. Wallace as Secretary of Agriculture, certain of the powers vested in the President of the United States by the aforesaid act. Under and pursuant to the delegation of such powers, the said ~eeretary of Agriculture pursuant to Section 3 (d) of the act and Executive orders under the act, upon his own motion presented a Code of Fair Competition for the Distilled Spirits Rectifying Industry after due notice and opportunity for hearing in connection therewith had been afforded interested parties, including respondent, in acconlance Complaint 23F.T.C· with Title I of the National Industrial Recovery Act and applicable regulations issued thereunder, to the President of the United States who approved the sume on the 9th day of December 1933, thereby constituting the said code a Code of Fair Competition within the meaning of the said National Industrial Recovery Act, for the regula· iion of the aforesaid Industry.

In his written report to the President, the said Secretary of Agriculture made, among others, the following findings with respect to the said code in the following words, to wit: That said Code will tend to effectuate the declared policy of Title I of the National Industrial Recovery Act as set forth in Section 1 of said Act in that the terms and provisions of such Code tend: (a) to remove obstructions to the free flow of foreign commerce, which tend to diminish the amount thereof; (b) to provide for the general welfare by promoting the organization of industry for the purposes of cooperative action among trade groups; (c) to eliminate unfair competitive practices; (d) to promote the fullest possible utilization of tlle present productive capacity of industries; (e) to avoid undue restriction of production (except as may be temporarily required); (f) to increase the consumption of industrial and agricultural products by increasing purchasing power; and (g) otherwise to rehabilitate industry. By his approval of the said code on December 9, 1933, the President of the United States, pursuant to the authority vested in him by Title I of the National Industrial Recovery Act aforesaid, made and issued his c"certain written Executive order, wherein he adopted and approved the report, recommendations and findings of the said Secretary of Agriculture, and. ordered that the said Code of Fair Competition be, and the same thereby was approved, and by virtue of the National Industrial Recovery Act aforesaid, the following provi· sion of Article V of the said Code became and still is one of the standards of fair competition for the Distilled Spirits Rectifying Industry and is binding upon every member of said Industry and this respondent:

The following practices constitute unfair methods of competition and shall not be engaged in by .any member of the industry: SECTION. 1. False Advertising.-To publish or disseminate in any manner any false advertisement of any rectified product. Any advertisement shall be deemed to be false lf it is untrue in any particular, or if directly or by ambiguity, omission or inference it tends to create a misleading impression. PAR. 7. The use by respondent of the word "distillers" in its corporate name, printed upon its stationery and on the labels attached to the bottles in which it sells and ships such products and in vari· ous other ways, constitutes false advertising within the meaning of the aforesaid provision of said Article V and tends to and does create the misleading impression that respondent is engaged in the business INTERSTATE DISTILLERS, INC. 843 837 Findings of distilling spirits, and that the spirituous beverages by it so sold and transported have been bottled at a distillery by the original distillers thereof, all contrary to the provisions of Section 1, Article V, of the Code aforesaid.

PAR. 8. The above alleged methods, acts and practices of the respondent are and have been in violation of the standard of fair competition for the Distilled Spirits Rectifying Industry of the United States. Such violation of such standard in the aforesaid transactions in interstate commerce and other transactions which affect interstate ~commerce in the manner set forth in paragraph 5 of count 1 hereof, are in violation of Section 3 of Title I of the National Industrial Recovery Act and they are unfair methods of competition in commerce within the meaning of the Federal Trade Commission Act as amended.

REPORT, FINDINGS AS TO THE FACTS, AND ORDER Pursuant to the provisions of an 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," the Federal Trade Commission, on April 22, 1935, issued and served its complaint in this proceeding, upon respondent Interstate Distillers, Inc., a corporation, charging it with the use of unfair methods of competition in commerce in violation of the provisions of said act. After the issuance of said complaint, and the filing of respondent's answer thereto, testimony and other evidence in support of the allegations of said complaint were introduced by PGad n. Morehouse, attorney for the Commission, before J olm ,V. Bennett an examiner of the Commission, theretofore duly designated by it, and in opposition to the allegations of the complaint by Horace J. Donnelly, Jr., attorney for the respondent; and said testimony and other evidence were duly recorded and filed in the office of the Commission. Thereafter, tht1 Proceeding regularly came on for final hearing before the Commission, on the said complaint, the answer thereto, testimony and other evidence, briefs in support of the complaint and in opposition thereto, and the oral arguments of counsel aforesaid; and the Commission having duly considered the same, and being now fully advised in the Premises, finds that this proceeding is in the interest of the public, and makes this its findings as to the facts and its conclusion drawn therefrom:

FINDINGS AS TO THE FACTS PARAGRAPH 1. Respondent is a corporation organized, existing, and doing business under the laws of the State of Maryland, with its FEDERAL TRADE COl\IMISSION DECISIONS844 Findings 23F T.C.

principal office and place o£ business at 36 South Calvert Street, in the city o£ Baltimore in said State. Originally incorporated Jannary 5, 1934, under the name o£ "Interstate 'Vine & Liquor Company", with a capital stock o£ one thousand shares, valued at $100 each, its charter authorized it, among other'things, to buy, sell, deal in, distill, redistill, manufacture, rectify, blend, import, and export all kinds of alcoholic beverages. By an amendment to its charter, dated February 21, 1934, the name was changed to "Interstate Distillers, Inc." It is now, and since February 1934 has been, engaged in business as a rectifier of spirituous liquors under a basic permit from the Federal Government, purchasing, rectifying, blending, and bottling whiskies, brandies, rums, and other spirituous beverages, and selling the same in constant course of trade and commerce between and among the various States of the United States and in the District of Columbia.

In the course and conduct of its business, respondent is, and has been, in competition with other corporations, individuals, and part·· nerships engaged in the manufacture by distillation of whiskies, brandies, and other spirituous beverages, and in the sale and dis· tribution thereof in interstate commerce; and also in competition with other rectifiers and wholesalers.

Respondent purchases its distilled spirits' requirements from distillers, and about 80% of the liquor put out by respondent is straight whiskey; and the rest, blended whiskey. Occasionally it sells a very small percentage of whiskey in bulk, and supplies some retailers with package goods.

Respondent's plant at the above address is described as follows: There are offices in the rear on the first floor, and elevator at the front entrance, four or five tanks with a capacity of from 150 to 450 gallons each on the second floor, and on the third floor is the processing room and wholesale room and retail stockroom. This respondent does not now have, and has never had, stills or other apparatus for the production of distilled spirits by an original and continuous distillation from mash, wort, or wash. PAR. 2. Since the repeal of prohibition, there has been, and still is, a sharp distinction in the trade between the processes of distilling and rectifying. Distilling is confined to the manufacture of alcoholic spirits by an original and continuous process from grain, or other raw materials, in a mash to a cistern room, in the case of whiskey. Rectifying deals wholly with subsequent modifications of the product not involving the process of distillation. This distinction in trade significance has been recognized by the Government through its· is- INTERSTATE DISTILLERS, INC. 845 837 Findings suance of two ~eparate kinds of basic permits to those engaging in the two respective operations.

Rectifying in the distilled spirits rectifying industry means the mixing of whiskies of different ages or the mixing of other ingredients with whiskies, but reducing proof of whiskey by adding water is not rectifying. Rectifiers also blend whiskies with neutral spirits (grain alcohol).

A distiller, in the sense ordinarily understood by the liquor industry, is one who prepares distilled spirits by a process of original and continuous distillation from mash, wort or wash, through continuous closed pipes and vessels until the manufacture thereof is complete. Many distillers operate a separate establishment 600 feet or more away from their distillery, known as a rectifying plant, wherein they operate in the same manner as described above, for a rectifier-sometimes exclusively with spirits of their own distillation and sometimes with spirits purchased from other distillers or both. Some distilleries have a tax-paid bottling room on the distillery bonded premises wherein their distilled spirits are bottled straight as trey come from the still, or in a bonded warehouse after aging, or after reduction of proof. Any rectifying by a distiller, however, must be done in his rectifying plant under his rectifier's permit. On all bottled liquors, whether bottled at the distillery rectifying plant or at any other rectifying plant, appear the words "Bottled" or ''Blended" (as the case may be) "by the -------------------- Com- Pany." If the distilled spirits therein contained are bottled by a distiller either in his distillery or are spirits of his own distillation bottled in his rectifying plant, the distiller may and does put "Distilled and Bottled by -------------------- Company." I£, in the distiller's rectifying plant, other spirits have been blended or rectified, he puts "Blended and Bottled by -------------------- Com- Pany." Finally, blown (usually in the bottom) in each bottle is a symbol, consisting of a letter followed by a number, identifying the bottler, viz., a "D" for a distillery and "R" for a rectifier, the number following said letter corresponding with the distiller's or rectifier's Permit. Thus "R--220" designates this respondent. A distiller who also operates a rectifying plant, having both kinds of permits, may Use either symbol depending upon whether the liquor contained in the bottle was produced and bottled under his distiller's or his rectifiber's permit.

Knowledge of these details is not widespread among the retail f trade and is very limited to the general public. It is not possible to determine from the presence of the phrase "Blended and Bottled by" alone, or the phrase "Bottled by" alone, 846 FEDERAL TRADE COM!\IISSION DECISIONS Finding-s 23 F. T. C. on the label, whether the package was bottled by a rectifier who is a distiller, or hy a rec6fiber who is not a distiller. · PAR. 3. Approximately thirty witnesses who had had no connection with the liquor industry were subpoenaed at the instance of the Commission to ascertain whether or not there existed a preference of a f-!Ubstantial portion of purchasers and potential purchasers to buy whiskies and other alcoholic beverages, bottled at or by a distillery or distilling company. These witnesses were fairly representative and included men from practically every walk of life; namely, a banker, stockroom clerk, sales manager, superintendent of fertilizer plant, salesman, government employee, pastry shop owner, electrical engineer, telephone man, real estate broker, postal clerk, department store manager, paper carrier, insurance man, a professor of anatomy. a syrup salesman, an assistant train yardmaster, coal merchant, and a graduate law student. Their testimony showed that the word "Distillers," or similar words in connection with the liquor industry, meant to them a person or concern which manufactured by distillation, and twenty-two of them testified that in a corporate name such as respondent's suclt a word as "distillers" would imply to them•that respondent was such a manufacturer, and they indicated a distinct preference to buy distillery-bottled packages of liquor, usually for the reason that'they felt more confidence in the goods, as the manufacturer, in their judgment, was likely to be more trustworthy and had more at stake than any middle-man. A liquor dealer with thirty-one years of experience in making contacts with the trade and the public was of the opinion, based upon such experience that, in the majority of cases, the ultimate consumer pre.fers to buy distillerybottled goods. The respondent produced approximately ten wit· nesses who were retail liquor dealers and who, from their experience with the public, stated it as their observation that customers paid no attention to the corporate or trade name of the seller as shown upon the labels, but made their purchases because of other considerations. Such testimony is not contradictory to that given by the thirty witnesses as aforesaid, from all of which the Commission concludes it to be true that there is a substantial portion of purchasers which prefers to buy beverages bottled by the original distiller or manu· facturer thereof.

PAR. 4. In the course and conduct of its business as aforesaid, by the use of the word "Distillers" in its corporate name, printed on its sta· tionery, and on the labels attached to the bottles in which it sells and ships such products, respondent represents, and furnishes its whole· sale customers with the means of representing to the retailer and ulti· mate purchaser that the said whiskies, brandies and other spirituous beverages therein contained, were by it manufactured through the INTERSTATE DISTILLERS, INC. 847 837 Conclusion process of distillation, when, as a matter of fact, the respondent is not a distiller and did not distill the said whiskies or other spirituous liquors by it so bottled, sold, and transported. PAR. 5. The Commission finds that because the trade, as well as the public, has a substantial preference to buy liquors bottled by the actual distillers, the tendency to diversion of trade by respondent's use of the Word "Distillers" in its name is plain, particularly with reference to any prospective purchaser who does not know from other sources the particular status of respondent, and the name readily lends itself as a tool to any salesman to be used by him for the purpose of gaining an unfair competitive advantage in competing with an actual distilling company for any particular order of whiskey. The use by respondent of the term "Distillers" in its trade or corporate name upon its invoices, stationery, advertising, and upon the labels attached to. the bottles in which it sells and ships its spirituous liquors, has a tendency to mislead and deceive wholesalers, retailers, and the ultimate purchasers into the belief that in purchasing the same they are purchasing a product bottled at a distillery by the original distillers thereof, and this, in turn, tends to, and does, unfairly divert trade from respondent's competitors to the respondent. Among such competitors, there are those who, manufacturing spirituous liquors by a process of original and continuous distillation from mash, wort or wash, do truthfully designate themselves as distilling companies, and also among such competitors are those in the same class with this respondent, to wit; those who are engaged in that branch of the industry known as the distilled spirits rectifying industry, and who, as rectifiers, do not untruthfully designate themselves as "distilleries," "distillers," or "distilling companies."

PAR. 6. The complaint herein was issued April22, 1935 (which was Prior to the decision of the United States Supreme Court, May 27, 1935, in the case of A. L. A. Schechter Poultry Corporation, et al, vs. United States, 2!)5 U. S. 495) and contained two counts. Count 1 specifically charged a violation of the Federal Trade Commission Act and count 2 charged that the practices of respondent, as hereinbefore set out, were unfair methods within the meaning of the Federal Trade Commission Act because they were in violation of Section ~ of Title I of the National Industrial Recovery Act which was Invalidated by the aforesaid decision.

For this reason the Commission is of the opinion that the complaint should be dismissed as to count 2 thereof.

CONCLUSTON The aforesaid acts and practices of the respondent, Interstate Distillers, Inc., a corporation, are to the prejudice of the public and of 848 FEDERAL TRADE COMl\IISSION DECISIONS Order 23F. T.C.

respondent's competitors, and constitute unfair methods of competition in commerce, :within the intent and meaning of Section 5 of an 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."

ORDER TO "CEASE AND DESIST This proceeding having been heard by the Federal Trade Commission upon the complaint of the Commission, the answer of respondent, testimony and other evidence taken before John ,V. Bennett, an examiner of the Commission, theretofore duly designated by it, in support of the allegations of said complaint and in opposition thereto, briefs filed herein, and oral arguments by PGad B. Morehouse, counsel for the Commission and by Horace J. Donnelly, Jr., counsel for respondent, and the Commission having made its findings as to the facts and its conclusion that said respondent has violated the provisions of and 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."

It is ordered, That the respondent Interstate Distillers, Inc., a corporation, its officers, representatives, agents, and employees, in connection with the offering for sale, sale, and distribution of whiskies, brandies and all other spirituous beverages in interstate commerce or in the District of Columbia, do forthwith cease and desist from: Representing through the use of the word "Distillers" in its corporate name, on its stationery, advertising, or on the labels attached to the bottles in which it sells and ships said products, or in any other way by word or words of like import, (a) that it is a distiller of whiskies, brandies, or any other spirituous beverages; (b) that the said whiskies, brandies or other spirituous beverages were by it manufactured through the process of distillation; or (c) that it owns, operates, or controls a place or places where any such products are by it manufactured by a process of original and continuous distillation from mash, wort, or wash, through continuous closed pipes and ,·esse]s until the manufacture thereof is completed, unless and until respondent shall actually own, operate, or control such a place or places. It is further ordered, That the said complaint be, and the same is hereby, dismissed as to count 2 thereof.

It is further ordered, That the said respondent, within 60 days fronl nnd after the date of the service upon it of this order, shall file with the Commission a report or reports in writing setting forth in detail the manner and form in which it is complying and has complied with the order to cease and desist hereinabove set forth. MONTEBELLO DISTILLERS, INC. 849 Complaint