Neet, Inc

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IN THE MATTER OF NEET, INC.

COMPLAINT, ~'INDJNGS, AND ORDEit IN REGARD TO THE ALLEGED VIOLATION OF SEC. II OF AN ACT OF' CONGRESS APPHOVED SEPT. 26, 1014 Docket 2716. Complaint, Jo'eb. "/, 19.~6-Dccision, Jun. 19, 193"/ Where a corporation engaged In manufacture, distribution, und sale of a depilatory known as "Neet", in widely advertising its said product in newspapers and periodicals of general circulation and In display cards, advertising folders, and literature printed and circulated by it thl'Onghont the several States to customers and prospective customers- ( a) Represented that by careful laboratory control its allwlescence bad been so regulated that it never approached causticity, facts being that, while not generally caustic when applied according to its directions, to those Portions of the body recommended for tr!O'atment with said product for rf'moval of superfluous hair, there are a number of persons whose skin is more suscf'ptible to irritation than that of others nnd in cage of whom it llllght have caustic f'ffect, as It might al>~o, not applied as directed; (b) Represented that use of said product uiscouraged growth of hair and lll'lnyed its appearance for a matf'rlal length of time, and that hair was much slower In rt>turning and t·cgt·owlng than when ~havcd, facts being l1air tf'growiug after use thereof Is no slower In returning, etc., than after shaving, allowance made for action of preparation in removing hair farther helow 8tuface of ~;kin than razor, and con>~(lqncnt greater delay in reap· P<'urance;

(1') Reptf'sented that ~ha1·!ug stimulates hair growth, and that hair returning or tl'growlng after use of Its Mid product Is softer and less than that 1'1'turning or rPgrowlng utter shaving, facts being former Is no softer or ll's>~ <'oarse thnn latt<'r, though rf'growth with rounded end and less coarse feeling may retmlt from dlflsolvlng process tijereof; (d) Ht>presented that !til said product gave results unllke other methods of hair removal, and that It was not an ordinary hair rt>movcr, and endl'll f'nlnrged Pores which shaving tto>ndcd to cnm~c, and would permanently eradicate hair, facts being shaving does not <·au~;e !Htch ('llhngell pores, nor lloes use of Its said produrt fnd !mme, und aforci'laid various rcpresentntions wf're false; and (e) Falsely represPntt>d that Its said product was u>:f'd by surgeons to remove hur before o""ratlng • "'' I" tb capacity and tendencyr to ml>~l<'ad and deceh·e a suhRtantlal portion of Dnrehnsing public Into the errotwous IM•licf that all said repreflentations were true, and into purchase of a substantial volume of its said product on a<'count of such beliefs, and with result that trade was diverted to 1t from those engaged in mnnufucturlng, distributing, and selling deplla· tortes or other products dcsignf'd, intenlled nnll sold for purpose of remov· lng superfluous hair, and who truthfully advertised same and ('f'l'ectlveness }[ tltf'rf'of; to the Injury of comp<'titlon In eomml'rce: Cld, That ~ncb acts and practices w£>re to the prejudice of the public and competitors and constituted unfair m<'thods of <'ompetltlon. COl\Il\USSIO~ DECISIONS466 FEDERAL TRADE Oomplaint ~!F. T. ('.

Before 11/r. John J. Keenan, trial examiner. J/ r. J. T. Welch, for the Commission.

Air. Edwards. Rogers and Air. H. H. Ramsay, of New York City, and Rogers, lV oodson & Rogen, of Chicago, Ill., for respondent. COMPLAINT 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," ths Federal Trade Commission, having reason to believe that Neet, Inc., u corporation, hereinafter referred to as respondent, has been and now is using unfair methods of competition in commerce as "commerce" is defined in said act, and it appearing to the Commission that a proceeding by it in respect thereof would be in the public interest, hereby issues its complaint stating its charges in that respect as follows:

P ARACRAPII 1. Respondent, N eet, Inc., is a corporation, organized, existing, and doing business under and by virtue of the laws of the State of New Jersey, with its principal office and place of business located in the city of Chicago, State of Illinois. Respondent is now, and has been for some years, engaged in the business of manufacturing, distributing, and selling, in commerce as herein set out, a certain clepilatory known as "Neet."

PAn. 2. Said respondent, being engaged in business as aforesaid, causes said depilatory, when sold, to be transported from its office and principal place of business in the State of Illinois to purchasers thereof located in various points in other States of the United States and in the District of Coll.Jmbia and there is now, and has been at all times since the organization of respondent corporation, a constant current of trade and commerce in said depilatory so manufactured, distributed, and sold by the respondent, between and among the various States of the United States and in the District of Columbia. PAR. 3. In the course and conduct of its said business, respondent is now, and has been, in substantial competition with other corporations, firms, and individuals likewise engaged in the business of manufacturing, distributing nml selling depilatories or other products de- !:'igncd, intended, and sold for the purpose of removing superfluous hair, in commerce among and between the ,·arious States of the United States and in the District of Columbia.

P.m. 4. In the course of the operation of said business, and for the purpose of inducing individuals, firms, and corporations to purchase said depilatory, respondent has caused advertisements to be inserted NEET1 INC. 467 4G5 Complaint iu ?newspapers and magazines of general circulation throughout the l!mted States and has printed and circulated throughout the several States to customers and prospective customers, through the United ~states mails and otherwise, display cards, advertising folders, and hterature, in all of which advertisements respondent has caused its torporate name to be prominently and conspicuously displayed, together with the following statements:

Its job is to remove hair and to delay its reappearance indefinitely and to relieve women of the highly stimulnted growth of hair bristles, following sha · VJng, that thow;;ands of women are suffering today. It gives results unlike any other method known to the scientific world In hair relllovai.

Not an ordinary hair remover.

Tle hair tllat regrows after using "Neet'' is many times softer and less coarse than the hair that comrs back after shaving and the hair itself is much slower In returning.

"Neet" ends, too, the disfigurement of enlarged pores. By careful laboratory control, the alkalescence of ''Neet" is regulated so that 1 ts DII never apvroachcs causticity. All of said statements, together with many similar statements ap- ~hearing in respondent's advertising literature purport to be descriptive of respondent's product. In all of its advertising literature, respondent represents, through statements and representations herein ~et out and other statements of similar import and effect, that (1) ~ts. Product is not caustic; (2) that its product discourages growth of ttr, cl_elays its reappearance for a material length of time and that h 1 ~ hair is much slower in returning or regrowing than when the tlair is. shaved; (3) that shaving stimula.tps hair growth; (4) that 1· 16 hair returning or regrowing after using uN eet" is softer and t~ss c.oarse than the hair returning or regrowing after shaving; (5) at Its product "ives results unlike other methods of hair removal and that its prourouct is not an ordinary hair remover; (6) that its Product ends enlarged pores and that shaving tends to cause enlarged r.ores; (7) that its product will permanently eradicate hair and ( 8) ~at many surgeons use its product to remove hair from patients fore operating.

t PAn. 5. Tlle representations made by the respondent with respect 0 the nature and effect of its product when used are grossly exaggerated, false, misleading, and untrue. In truth and in fact, the f{~duct i~ caustic, par.ticularly when the product _is introduce? into eye; 1t does not discourage the growth of hair or delay Its reappearance for any material lenll'th of time and the hair is not appreciably slower in returning :X, regrowing than it is following Complaint 24F. T. C.

shaving or following the use of other methods of hair removal. Shaving does not stimulate hair growth and the hair that returns after using "Neet" is not softer and less coarse than the hair that regrows following shaving. The product known as "Neet" does not give results unlike other methods of hair removal but the results given are similar to those given by many other depilatories and respondent's product is an ordinary hair remover. Shaving does not cause enlarged pores and the use of respondent's product does not end enlarged pores, nor will it permanently eradicate hair. Surgeons do not use respondent's product for the purpose of removing hair from patients before operating.

PAR. 6. There are among respondent's competitors many who manufacture, distribute and sell depilatories or other products designed, intended, and sold for the. purpose of removing superfluous hair and who do not in any way misrepresent the quality or character of their respective product or its effectiveness in removing said hair growth. PAR. 7. Each and all of the false and misleading statements and representations made by the respondent in designating or describing its product and the effectiveness of said product for removing hair, as hereinabove set out, in its advertising in newspapers, magazines, booklets, pamphlets, display cards, and other advertising literature, in offering for sale and selling its product was, and is, calculated to, and had, and now has, a tendency and capacity to mislead and deceive a substantial portion of the purchasing public into the erroneous belief that all of the said representations are true. Further, as a direct consequence of the mistaken and erroneous beliefs, induced by the acts, advertisements, and misrepresentations of respondent, as hereinabove detailed, a substantial number of the consuming public has purchased a substantial volume of respondent's depilatory with the result that trade has been unfairly diverted to the respondent from individuals, firms, and corporations likewise engaged in the business of manufacturing, distributing, and selling depilatories or other products designed, intended, and sold for the purpose of removing superfluous hair, and who truthfully advertise their products. As a result thereof, substantial injury has been, and is now being done, by respondent to substantial competition in commerce among and between the various States of the United States and in the District of Columbia.

PAR. 8. The above and foregoing acts, practices, and representations of the respondent have been, and are, all to the prejudice of tho public and respondent's competitors as aforesaid, and have been, and are, unfair methods of competition within the meaning and intent NEET, INC. 469 465 Findings of Section 5 of an Act of Congress approved September 20, 1914, entitled "An Act to create a Federal Trade Commission, to define its Powers and duties, and for other purposes." REPORT, FINDINGS AS TO THE FACTs, AND Onder Pursuant to the provisions of an Act of Congress approved September 20, 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 February 7, 1V30, issued and served its complaint in this proceeding upon respondent Nect, Inc., 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 J. T. 'Welch, attomey for the Commission, before John J. Keenan, an examiner of the Commission theretofore duly designated by it, and in opposition to the allegations of the complaint by James H. Rogers, attorney for the respondent; and said testin1ony and other evidence were duly recorded and filed in the office of the Commission. Thereafter, a stipulation was entered into Whereby it was stipulated and agreed that a statement of facts signed and executed by the respondent's counsel, Rogers, ·woodson & Rogers and "\V. T. Kelley, Chief Counsel for the Federal Trade Commission, subject to the approval of the Commission, may be taken as facts in this proceeding in addition to the testimony theretofore taken and that the said Commission may proceed upon said statement of facts and upon the testimony and evidence taken to make its report, stating its findings as to the facts and its conclusion based thereon and enter its order disposing of the proceeding without the presentation of argument or the filing of briefs. Thereafter, the proceeding regularly came on for final hearing before the Commission on the said complaint, the answer thereto, testimony and other evidence and said stipulation as to the facts, said stipulation having been approved and accepted by the Commission, 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, N eet, Inc., is a corporation, organized, existing, and doing business under and by virtue of the laws of the State of New Jersey. Its principal office and place of business is lo- Findings 24F. T. C.

cated in the city of Chicago, State of Illinois. For some years the respondent has been engaged in the business of manufacturing, distributing, and selling a certain depilatory known as "Neet." When orders are received for said depilatory, respondent ships said product so purchased from its principal place of business in the State of Illinois to the respective purchasers thereof located at various points in other States of the United States and in the District of Columbia. Respondent, has, at all times, maintained a constant current of trade in commerce in said depilatory manufactured, distributed, and sold by it between and among the various States of the United States and in the District of Columbia. There are likewise other corporations, firms, and individuals engaged in the business of manufacturing, distributing, and selling depilatories or other products designed, intended, and sold for the purpose of removing superfluous hair, in commerce among and between the various States of the United States and in the District of Columbia. Respondent, N"eet, Inc., is in substantial competition in the sale of its product "Neet" with said other corporations, firms, and individuals in the sale of their respective products. PAR. 2. For the purpose of inducing the purchase of its depilatory, respondent has widely advertised said product in advertisements inserted in newspapers and magazines of general circulation throughout the United States. It has also printed and circulated throughout the several States, to customers and prospective customers, display cards, advertising folders, and literature. In all of the advertisements and advertising matter hereinabove mentioned, respondent has caused its corporate name to be prominently and conspicuously displayed, to· gether with such statements as the following: Its job Is to r·emove hair and to dl'lay Its reappea1·ance Indefinitely anu to relieve women of the highly stimulate(} growth of hair bristles, following shaving, that tl'...,usands of women are su1Terlng today. It gives results uulilce :my other method known to the scientific world In hair removal.

Not nn ordinary hair remover.

The hair that regrows after using "Neet" Is many times softer and less coarse than the hair that comes baclc after shaving aud the hair Itself Is much slower In returning.

"Neet" ends, too, the disfigurement of enlarged pores. By careful laboratory control, the alkalescence of "Neet" is regulated so that Its pii never approaches causticity.

Tile statements above set out, together with many similar statements appearing in respondent's advertising literature, purport to be descriptive of its product. Through these statements aml other sim· ilar statements of similar import and effect, the respondent represents that (1) its product is not caustic; (2) that its product discourages NEET, INC. 471 465 Findings growth of hair, delays its reappearance for a mateFiallength of time and that the hair is much slower in returning or regrowing than when the hair is shaved; (3) that shaving stimulates hair growth; ( 4) that the hair returning or regrowing after using "N eet" is softer and less coarse than the hair returning or regrowing after shaving; (5) that its product gives results unlike other methods of hair removal and that its product is not an ordinary hair remover; ( 6) that its product ends enlarc;ed pores and that shaving tends to cause enlarged pores; (7) that its product will permanently eradicate hair and (8) that many surgeons use its product to remove hair from patients before operating.

PAR. 3. In truth and in fact, the product designated as "Neet" is not generally caustic when applied according to respondent's di- J·sections to those portions of the body recommended to be treated with said product for the removal of superfluous hair. There are a number of persons whose skin is more susceptible to irritation than that of others. The product "Neet" might have a caustic effect when applied to the skin of such persons. It might, also, have a caustic effect when not applied in accordance with the respondent's directions.

The product is caustic to such sensitive portions of the body as the eyes, but is not normally applied to the eyes and is introduced into them only in cases of misapplication. In many cases, the product may produce a sufficient dermatitis to result in a redness of the skin in the area treated, but this dermatitis is not generally of such a character as to be considered a caustic burn. "Neet" does not discourage the growth of hair and does not delay its reappeamnce for any material length of time. The hair regrowing after the use of said product is no slower in returning and regrowing than when the hair has been shaved, except that when the hair is removed by the use of said product, it is generally taken off farther below the plane of the surface of the skin than when the hair is removed with a razor. In shaving the hair, the stalk of the hair is generally cut off at a point in line with the plane of the skin surface. In the removal of hair by the respondent's process or any process similar thereto, the product, to some extent, goes down into the pores and dissolves the stalk of the hair Lelow the plane of the skin surface. To the extent that the product goes below the plane of the skin surface in dissolving the hair stalk, the hair will be delayed in reappearing above the plane of the skin surface. There is no scientific basis for the statement or representation that sl1aving stimulates the hair growth or causes the regrowing hair to 472 FEDERAL TRADE COl\Il\IISSIO~ DECISIONS l•'iudings 24F. T. C. come in faster or· coarser. In fact, the shaving of superfluous hair has no effect whatever on the texture or rate of growth of the regrowing hair.

The hair returning or regrowing after the use of ~'N eet" is no softer or less coarse than the hair returning or regrowing after shaving. Dy reason of the process by which respondent's product dissolves the hair stalk rather than chopping it off, the hair regrowing or returning after the use of said product may have a rounded end with the result that the returning or regrowing hair feels less coarse. The use of respondent's said product does not give results unlike other methods of hair removal. On the contrary, thp use of the product gives results similar to the results given by other methods of hair removal and respondent's product is an ordinary hair remover. Shaving does not cause enlarged pores in the skin and the use of respondent's product does not end enlarged pores. In fact, the use of respondent's product will have no effect v.·whatever on the size or character of the pores of the skin.

Respondent's product will not permanently eradicate hair and its use has no effect whatever on the roots of the hair. Surgeons do not, in fact, use respondent's said product to remove hair from patients before operating on said patients. PAR. 4. There are among respondent's competitors many who manufacture, distribute and sell depilatories or other products designed, intended and sold for the purpose of removing superfluous hair and who do not in any way misrepresent the quality or character of their respective product or 1ts eflectiveness in removing said hair growth. PAR. 5. The various statements and representations made by the respondent in describing its product and the effectiveness of said product in use had, and now have, a capacity and tendency to mislead and deceive a substantial portion of the purchasing public into the l'l'roneous belief that all of said representations are true and into the purchase of a substantial volume of respondent's depilatory on account of such beliefs induced by respondent's representations contained in its various advertisements. .As a result thereof, trade has been diverted to the respondent from individuals, firms, and corporations likewise engaged in the business of manufacturing, distributing and selling depilatories or other products designed, intended, and sold for the purpose of removin~ superfluous hair, and who truthfully advertise their products and the effectiveness of said products when used. As a consequence thereof, injury has been, and is now being, done by respondent to comp<'tition in commerce between and among the va· rious States of the United Stutes.

NEET, INC. 473 465 Order CONCLUSION The aforesaid acts and practices of the respondent, Neet, Inc., are to the prejudice of the public and of 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 DERIST 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 J. Keenan, an examiner of the Commission theretofore duly designated by it in support of the allegations of said complaint and in opposition thereto and upon a stipulation as to the ·facts entered into between the respondent herein ami W. T. Kelley, Chief Counsel for the Commission, and the Commission having made its findings as to the facts and conclusion tha.t said respondent has violated the provisions of an Act of Congress approyed 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, Neet, Inc., a corporation, its officers, representatives, agents, and employees, in connection with the offering for sale, sale, and distribution of a depilatory product now known and designated as "Neet," or of a product of substantially the same composition and ingredients sold under the name "Neet" or under any other name, in interstate commerce or in the District of Columbia do forthwith cease and desist from representing: 1. That its product is not caustic, provided that the respondent is not hereby prohibited from representing the said product is not generally caustic;

2. That the use of said product discourages the growth of hair and delays its appearance for a material length of time and that the hair is much slower in returning and regrowing than when it is shaved, provided that the respondent is not hereby prohibited from representing that the hair returns more slowly when removed by respondent's product than when removed by a razor to whatever extent said product penetrates into the pores below the plane of the surface of the skin and dissolves the hair stalk; 3. That shaving stimulates hair growth;

4. That the hair retnming or rPgrowing after using its product is softer and less coarse than the hair returning or regrmYing after Order 2-!F. T. C. shaving, provided that the respondent is not hereby prohibited from representing that the hair returning or regrowing after using its product feels less coarse on account of the rounded end thereof; 5. That its product gives results unlike other methods of hllir removal and that its product is not an ordinary hair remover; 6. That its product ends enlarged pores or that shaving tends to cause enlarged pores ;

7. That its product will permanently eradicate hair; 8. That its prouuct is used by surgeons to remove hair before operating.

It ~ further ordered, That the respondent shall, within GO days after service upon it of this order, file with the Commission a report in writing setting forth in detail the manner and form in which it has complied with this order.

RALADAM CO. 475 Syllabus