Mount Rose Distilling Co

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IN Tile MATTER OF MOUNT ROSE DISTILLING COMPANY COMPLAINT AND ORDER IN REGARD TO Till~ ALLEGED VIOLATION OF SEC. !I' OF AN ACT OF CONGRESS AI'l'HOVED SEPT. 26, 1914 Docket 2J,BD. Complaint, July 3, 1935-order, Feb. 2, 1931 Consent order requiring re~pondent corporation, its officers, etc., In connection with sale or offer, In interstate commerce nnd in District of Columbia, o{ whiskies, gins, and other alcoholic hevernges produced by it, hnt excepting gins produced by It through process of rectificntion whereby nlcohol purchased, but not produced, by it is redistilled ns F<peeitkd, to cea~e nnd desist from representing, through use of wor<l "Distilling" in Its corporate name and on its stationery, advertising, etc., or in any other way, that it is a distiller of whiskies, gins, or other alcoholic beverages or that said whiskies, etc., were by it made through process of distillation or that it owns, operates, or controls a place where such products are thus made, unless and until it shall own, operate, or control a place or places where such products are by it manufactured through proce,;s of original und continuous distillation from mash, wort, or wash through contiunous closed pipes and vessels until manufacture is complete. llfr. PC ad B. 111 orehou8e for the Commission. Complaint Pursuant to the provisions of an Act of congress npprowd September 2G, 1914-, entitled, "An Act to create a Federal Trade Cotn· mission, to define its powers and duties, and for other purposest the Federal Trade Commission, havin~ reason to believe that Mount Rose Distilling Company, a corporation, hereinafter reft'nNl to ns respoJHlf'nt, has Lt't'll and is usin~ unfair methods of competition in commt'rce, as "commerce" is dt'fin('(l in said act, and it appearing to the sai<l 0'ommission that a proct'etling by it in rrspect thert'of would be in the pulJlic interest, herrby issues its complaint, stating its chargrs in that rt'spect as follows:

PARAGRAPH 1. lh•spondent is a corporation organized, existin!!, nn<l doing~ bnsint'ss under the laws of the State of New ,Jt'rst'v, with its oflice and principal place of business in the city of Trent~n, in said State. It is now, and for more than one year last past has been, engaged in the businrss of producing and bottling gins in a rectifying plant and in the sale thereof in constant course of trade nnd commerce lJetw<'en and among~ the various States of the Unite<l States and in the District of Columbia. In the course and conduct of its said businpss it causes its sai<l products when sold to be transported from its place of business aforesaid into and through various other MOUNT ROSE DISTILLING CO. 639 638 Complaint States of the United States to the purchasers thereof, consisting of wholesalers and retailers 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 now, and for more than one year last past has been, in substantial competition with other corporations and with individuals, partnerships, and firms engaged in the manu- ~acture by true distillation o"f gins from mash, wort, or wash and lll 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 for more than one year last past, in substantial competition with other corporations and with individuals, firms, and Partnerships engaged in the business of producing and bottling gins and in the sale thereof in commerce between and among the various States of the United States and in the District of Columbia. PAn. 2. Upon the premises of respondent's place of business aforesaid, there are stills 'which respondent uses in the production of gins by a process of rectification whereby alcohol, purchased but not produced by respondent, is redistilled over juniper berries and other aromatics. Such rectification of alcoholic spirits does not make or constitute respondent a distiller, as defined by Section 3247 of the l~revised Statutes regulating Internal Revenue, nor as commonly understood by the public and the liquor industry. For a long period ?f time the word "distilling" when used in connection with the liquor 1?dustry and with the products thereof has had and still has a definite ~Ignificance aml meaning to the minds of wholesalers and retailers Ill such industry and to the ultimate p·urchasing public, to wit, tho Inanufacturing of such liquors by the process of dbtillation from tnash, wort, or wash, and a substantial portion of the purchasing PttLlic prefers to buy gins produced by a process of ori~inal and continuous distillation from mash, wort, or wash prepared and bottled by the distillers.

PAn. 3. In the course and conduct of its business us aforesaid, by !he Use of the wor1l ''Distilling'' in its corporate name pri11ted on Its stationery, advertising matter, and on the labels attached to the bottles in which it sells and ships its saitl products, and in various ot!1er ways, respondent represents to its customers and fnrnishes them '"1th the means of representing to their wndees, both retailers and the ultimate consuming public, that the said gins therein contained "'ere by it manufactured through a true process of distillation from n:aslt, wort, or wash, when, as a matter of fact, respo!Hl(lnt is not a distiller, does not distill the said gins by it so bottled, labeled, sold, and transported, and merely by the use of stills operated by it as 640 FEDERAL TRADE COl\fMISSION DECISIONS Complaint 24F.T.C.

aforesaid in the rectification of alcoholic spirits by redistillation over juniper berries and other aromatics, does not distill the gins by it so bottled, labeled, sold, and transported in the sense in which the word "distilled" is commonly accepted and understood by those en· gaged in the liquor trade and the public. Respondent does not own, operate, or control any place or places where such beverages are man· ufactured by a true process of distillation from mash, wort, or wash, and said gins are not produced and bottled in a distillery. PAn. 4. There are among the competitors of respondent engaged in the sale of spirituous beverages as mentioned in paragraph 1 hereof corporations, firms, partnerships, and individuals who distill from mash, wort, or wash gins sold by them and who truthfully use the words "distillery," "distilleries," "distillers," or "distilling" as ~ part of their corporate or trade names and on their stationery, adver· tising, and on the labels of the bottles in which they sell and ship such products. There are also among such competitors corpora· tions, firms, partnerships, and individuals who manufacture and pro· duce gins by a process of rectification similar to that used by this respondent and who do not use the words "Llistillery," "distilleries,'' "distilling," or "distillers" as a part of their corporate or trade names, nor on their stationery, advertising, 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 para· graph 3 hereof, is calculated to aml has a capacity and tendency to and docs mislead and deceive dealers and the purchasing public into the belief that respondent is a distiller and that the gins sold by the respondent are produceu by a true process of distillation by it fronl mash, wort, or wash, and is calculateu to and has the capacity and tendency to and does induce dealers and the purchasing public, act· ing in such belief~ to purchase the gins manufactured and bottled by the respondent, thereby diverting trade to respondent from its competitors who do not by their corporate or trade name or in any .other manner misrepresent that they are distillers, and thereby re· spondent does substantial injury to substantial competition in inter· state commerce. . PAn. 6. The acts and things above alleged to have been done and the false representations alleged to have been made by respondent are to the prejudice of the public and the competitors of respondent, and constitute 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, 1014:. MOUNT ROSE DISTILLING CO. 641 Order ORDER TO CEASE AND DESIST This proceeding having come on to be heard by the Federal Trade Commission upon the complaint hereinbefore issued and served upon Mount Rose Distilling Company, respondent herein, and the said respondent's written answer made thereto, waiving the taking of testilhony, findings as to the. facts, filing of briefs, oral argument and all other intervening procedure, and consenting that an order shall issue ~erein for it to cease and desist from methods of competition charged In the complaint, and the Commission being fully advised in the Premises, having thereupon concluded that respondent has violated 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."

It is no10 ordered, That respondent, }tfount Rose Distilling Com- P:ny, its officers, representatives, agents, and employees, in connection With the sale, offering for sale, and distribution in interstate commerce and in the District of Columbia of whiskies, gins, and all other alcoholic beverages, except gins by it produced through a process of rectification whereby alcohol purchased but not produced by respondent is redistilled over juniper berries and other aromatics, do cease and desist from :

Representing through the use of the word "Distilling" in its cor- Porate name, on its stationery, advertising, or on the labels attached to the bottles in which it sells and ships its said products, or in any other way by word or words of like import, that (a) it is a distiller of whiskies, gins, and other alcoholic beverages; cr (b) the said "Whiskies, gins, and other alcoholic beverages were by its manufactured through the process of distillation; or (c) it owns, operates, or controls a place or places where such beverages are manufactured by the process of distillation, unless and until the said respondent shall own, operate, or coutrol a place or places where such whiskies, gins, and other alcoholic beverages are by it manufactured through a Process of original and continuous distillation from mash, \vort, or 'Wae>h, through continuous closed pipes and vessels until the manufacture thereof is completed.

It is further ordered, That the said respondent, within ()0 days from and 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. Syllabus