Russek'S Fiith Avenue, Inc

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IN THE 1\fA'ITER OF RUSSEK'S FIFTH A VENUE, INC.

COMPLAINT, FINDINGS, AND ORDER IN REGARD TO THJil ALLEGED VIOLATION OF SEC. 5 OF AN ACT OF CONGRESS APPROVED SEPT. 26, 1914 Doclcct 3066. Complai11t, lt'cb. 25, 1931-Decision, Apr. 24, 1931 Where a corporation engaged as retailer of women's wares, such as furs, coats, dresses, and other items of wearing apparel, in shipping from its place of business to the purchasers thereof in other States articles of merchandise sold by it- Made use of words "silk" or "satin" In soliciting sale of i.ts products t~ purchasers in various States, through advertisements and advertising matter in newspapers circulating among the various States, through representing, designating, and referring to products thus offered as "satin and sill;: jersey dresses'' or as "silk afternoon dresses," as case might be, notwithstanding fact dresses respectively thus described were not composed of silk, product of the cocoon of the silk worm, as long specifically and definitely understood in mind of purchasing public from words "silk" or "satin," as long associated In said mind with the long and highly esteemed silk fabrics, and preeminent quality thereof;

With tendency and ca1mcity to ml~lead fill(). deceive a substantial portion of the purchasing public into the erroneous belief that SUCh representations Were true and to cause them to buy such dresses on account of such erroneous IJelicf, and to unfairly divert trade to it from competitors engaged in the sale of dresses and other women's wearing apparel, who do not misrepresent the kind. of dresses offered, but truthfully advertise and represent the nature and kind thereof; to the substantial injury of competition in commerce:

licld, That such acts and practices were to the prejudice of the public and competitors and constituted unfair methods of competition. nefore !1/r. John L. IIornor, trial examiner. 11!r. Astor llogg for the Commission.

Weisman, Quinn, Allen & Spett, of New York City, for respondent. Complaint Pursuant to the provisions of an Act of Congress, approved September 26, 1914, entitled "An Act to create a Federal Trade Comtnission, to define its powers and duties, and for other purposes," the F~deral Trade Commission, having reason to believe that Russek's Fifth A venue, Inc., a corporation, hereinafter referred to as respondent, has been, and is using unfair methods of competition in comtnerce 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 jn that respect as follows:

HG7:iGm-39-vol. 24--71 Complaint 24 F. T. C. PARAGRAPH 1. Respondent, Russek's Fifth Avenne, Inc., is a corporation organized, existing, and doing business under and by virtue of the laws of the State of New York, with its principal office and place of business located on 5th Avenue at 36th Street, in the city of New York in said State.

Respondent is now, and has been for several years last past, engaged in business as a retailer of women's wear, such as furs, coats~ dresses, anu other items of wearing apparel. It sells, and has sold and distributed, such articles of merchandise to members of the purchasing public located in various States of the United States, and in the District of Columbia. Respondent now causes, and during the time herein mentioned has caused, its articles of merchandise, when sold, to be shipped from its place of business in New York City to the purchasers thereof located in the various States of the United Statf's other than the State of New York and in the District of Columbia. There is now, and has been at all times mentioned hereint a constant current of trade and commerce by the respondent in said articles of merchandise between and among the various States of the United States, and in the District of Columbia. Respondent is now and at all times herein mentioned has been in substantial competition with other corporations and with firms, partnerships, and individuals engaged in the sale and distribution of women's wearing apparel, including furs, coats, and dresses in commerce among the various States of the Uniteu States, arid in the District of Columbia.

PAR. 2. In the course and conduct of its business ns described in paragraph 1 hereof, the respondent, in soliciting the sale of and selling its products to purchasers located in the various States of the United States, caused advertisements and advertising matter to bo inserted in newspapers having circulation in and among the various · States of the United States, wherein certain of its dresses were represented, designated, and referred to as "satin and silk jersey dresses," while certain other dresses were represented, designated and referred to as "silk afternoon dresses." Such statements and representations served as representations on the part of respondent that such dresses, so advertised and offered for SRle, were silk dresses. The representations hereinbefore set forth, are grossly false and misleading in that said dresses so represented, designated and referred to as being silk and satin silk are not and were not composed of silk, the product of the coon of the silkworm, but were composed of a material, or materials, other thnn silk. PAR. 3. The word "silk" for many years past, has had and still has, in the minds of the consuming public, a definite and specific RUSSEK'S FIFTH AVENUE, INC. 1087 1085 Findings meaning, to wit, the product of the cocoon of the silkworm. Silk fabrics for many years have held, and still hold great public esteem and confidence for their preeminent qualities. Silk fibre has long been woven into a variety of fabrics and a variety of distinctive terms have been applied to the fabrics resulting from different types of weaving. The term "satin" has been for a long time, and at the present time still is associated in the public mind. with a fabric made from the cocoon of the silkworm, commonly known and understood by the public as silk. · PAR. 4. The use by respondent of the representations set forth herein has lut<l and now has the capacity and tendency to mislead and deceive nnd has misled and deceived a substantial portion of the purchasing public into the erroneous belie£ that such representations are true, and to cause them to purchase such dresses on account of such erroneous belie£ engendered as above set forth. There are, among the competitors .of respondent, as mentioned in paragraph 1 hereof, corporations, individuals, partnerships and firms engaged ·in the sale of dresses and other women's wearing apparel who do not misrepresent the kind of dresses offered for sale, but who likewise auvertise, sell and distribute their <lresses among the various States of the United States and in the District of Columbia. lly the t·epresentations aforesaid trade is unfairly diverted to respondent from such competitors, and thereby substantial injury is being, and has been, done by respondent to competition in commerce as herein set out.

PAR. 5. The above alleged acts anu practices of respondent are all to the injury and 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 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 Sept:mber 26, 1914, entitled "An Act to create a Federal Trade Commis- Sion, to define its powers and duties, and for other purposes," the ~ederal Trade Commission on February 25, 1937, issued and served Its complaint in this proceeding upon respondent Russek's Fifth Ave- ~ue, Inc., charging it with the use of unfair .methods of competition ~ 11 commerce in violation of the provisions of said act. After the Issuance of said complaint and the filing of respondent's answer thereto, the attorneys of record for said respondent tendered and 1088 FEDERAL TRADE COl\:Il\HSSION DECISIONS Findings 24 F. T. O. entered into a stipulation as to the facts with the Chief Counsel for the Commission, subject to the approval of the Commission, by which it is agreed that the statement of facts therein contained may be taken as the facts in this proceeding, and in lieu of testimony in support of the charges stated in the complaint and in opposition thereto; and that the Commission may proceed upon said statement of facts to make its report, stating its findings as to the facts (including inferences which it may draw from the said stipulated facts) and its conclusion based thereon, and enter its order disposing of the proceeding without the presentation of argument or the filing of briefs; which ~aid stipulation has been approved by the Commission. Thereafter, the proceeding regularly came on for final hearing before the Commission on the said complaint, the answer thereto, and the said stipulation and statement of facts, 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 PARAGRAPII 1. Respondent, Russek's Fifth A venue, Inc., is a corporation organized, existing, and doing business under the laws of the State of New York with its principal office and place of business located on Fifth Avenue at 3Gth Street in the city of New York in said State. Respondent is, and has been for several years last past, engaged in business as a retailer of women's wares such as furs, coats, dresses, and other items of wearing apparel. It sells and distributes such articles of merchandise to members of the purchasing public located in the various States of the United States. It causes, and has caused, its articles of merchandise '"hen sold to be shipped from its place of business in New York City to the purchasers thereof located in the various States of the United States other than the State of New York. There is now, and has been at all times mentioned herein, a constant current of trade and commerce by the respondent in said articles of merchandise between and among the various States of the United States. Respondent is now, and at all tirnes herein mentioned has been, in substantial competition with other corporations, and with firms, partnerships, and individuals engaged in the sale and distribution of women's apparel, including furs, coats, and dresses in commerce among and between the various States of the United States.

PAn. 2. Respondent in soliciting the sale of and selling its products to purchasers located in the various States of the United States, RUSSEK'S FIFTH AVENUE, INC. 1089 1085 Conclusion caused advertisements and advertising matter to be inserted in newspapers having circulation in and among the various States of the United States, wherein certain of its dresses were represented, designated, and referred to as "satin and silk jersey dresses," while certain other dresses were represented, designated, and referred to as "silk afternoon dresses." In and by such representations and statehlents, respondent represented that such dresses so advertised and offered for sale were silk dresses. Such statements and representations thus made are and were false and misleading in that said dresses so represented as being "silk" and "satin and silk" are not and were not composed of silk, the product of the cocoon of the silk worm but were composed of materials other than silk.

PAR. 3. The word "silk" for many years last past has had and still has in the minds of the purchasing public a definite and specific hleaning, to wit: the product of the cocoon of the silk worm. Silk fabrics for many years have held and still hold great public esteem and confidence for their preeminent qualities. Silk fibre has long been woven into a variety of fabrics, and a variety of distinctive terms have been applied to the fabrics resulting from different types of Weaving. The term "satin" ha$ been for a long time, and at the Present time is associated in the public mind with a fabric made from the cocoon of the silk worm, commonly known and understood by the Public as "silky."

PAn. 4. The use by the respondent of the representations set forth herein have had and now have the tendency and -capacity to mislead and deceive a substantial portion of the purchasing public into the erroneous belief that such representations are true and to cause them to purchase. such dresses on account of such erroneous belief brought about as above set forth. There are among the competitors of the r~spondent as mentioned in paragraph 1 hereof, corporations, indi- VIduals, partnerships, and firms engaged in the sale of dresses and other women's wearing apparel, who do not misrepresent the kind of dresses offered for sale, but who truthfully advertise and represent the nature and kind of dresses sold by them. The representations hlade by respond(:!nt as aforesaid, have the capacity and tendency to unfairly divert trade to respondent from such competitors; thereby substantial injury is being done and has been done by the respond- ('nt to competition in commerce as herein set out. CONCLUSION A The aforesaid acts and practices of the respondent, Russek's Fifth venue, Inc., are to the prejudice of the public and of respondent's 1090 :FEDERAL TRADE COl\I:MISSION DECISIONS Order 24F. T.C.

competitors, and constitute unfair methods of competition in commerce, within 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 the respondent and the agreed stipulation of facts entered into between th~ respondent herein, Russek's Fifth Avenue, Inc., and ,V. T. Kelley, Chief Counsel for the Commission, which provides among other things that without further evidence or other intervening procedure the Commission may issue and serve upon the respondent herein, findings as to the facts and conclusion based thereon and an order disposing of the proceeding, and the Commission having made its findings as to the facts and conclusion that ·said respondent has violated 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."

It is ordered, That the respondent Russek's Fifth A venue, Inc., its officers, representatives, agents, and employees in connection with the offering for sale, sale, and distribution of its merchandise, dress goods and garments in interstate commerce or in the District of Columbia, do forthwith cease and desist from:

(1) Using the word ''silk" either alone or in conjunction with any word or words to describe or refer to the fabric of merchandise, dres~ goods, or garments not composed entirely of silk, the product of the cocoon of the !lilk worm.

(2) From using the \Vord "satin" either alone or in conjunction with any other word or words to describe or refer to the fabric merchandise, dress goods, or garments not made wholly from silk, the product of the cocoon of the silk worm. · It is furtlwr or-dered, That the respondent, Russek's Fifth Avenue, Inc., shall within 30 days after service upon it of a copy of this ord~r file with the Commission a report in writing setting forth in detail the manner and form in which it has complied with the order to cease and desist hereinabove set forth.

ATZ'S HATCHERY, ETC, 1091 Syllabus