The Coolerator Company

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IN THE MATTER OF THE COOLERATOR COMPANY COMPLAINT, FINDINGS, AND ORDER IN REGARD TO THE ALLEGED VIOLATION OF SEC. 15 OF AN ACT OF CONGRESS APPROVED SEPT. 26, 1914 Docket 2110. Complaint, .Ap1·. 16, 1936-Decision, July 10, 1931 Where a corporation engaged in distribution and sale of non-mechanical or ice refrigerators for resale by retail dealer purchasers thereof, in advertising its said non-mechanical refrigerators through large numbers of booklets and through folders, circulars, and other advertising litel'Utnre distributed to members of the purchasing public in the various States or furnished to lts customers for distribution to such public, and also through advertisements In newspapers and periodicals of general circulation- (a) Represented that temperature of from 45 to 50 degrees Is established or required standard necessary In all types of refrigerators for most satisfactory preseryation of foods, and that In mechanical or electric refrigerators proper temperature for such preservation cannot be mnintalned without detriml'ntally disturbing 11natural composi~lon of air and natural composition of food In the refrigl'rator, and that foods kept therein dl'hydrate to such an extent that their nutritive properties are Impaired, whereas foods kept in the other do not, to any extent whatever, dehydrate, and that only with ice Is it possible to produce proper temperature control of foods without disturbing natural composition of air or food; Facts being, among others, there Is no such established or required standard temper11 tnre 11necessary for satisfactory food preservation in all types of refrigerators, tl'mperature range Is not limited to that between 45 and 50 degrees, but food can properly be preserved at lower temperatures, maintained tNnperature of 50 degrees or lower Is generally accepted by experts as adequate for proper preservation of perishable foods in edible condition for normal length of time In domestic refrigerators, proper temperatures for satisfactory preserv11tlon of usual foods In mechanical refrigerators for domestic use can generally be maintained without detrimentally disturbing natural composition thereof, foods stored therein for ordinary length of time do not dehydrate to such extent as to impair their nutritive properties, and while foods kept In non-mechanical refrigerators dehydrate to some extent, depending upon various factors, it Is possible, through use of refrigerants other thnn lee, as well as ice, to produce proper food temperature control without disturbing natural composition of air or food in the refrigerator to any harmful extent, and representations hereinabove set forth were, as thus indicated, too general, lacking in specific limitation, misleading, and, In some instances, not true; (b) Represented that various gases u~ed in electric refrigerators as part of rl:'frigerunt escape from coils in which contained, permeate food chnmber, and have a delt'terlous effect on and taint foods contained in refrigerator, u ntl that certain poisonous gases, such as sulphur dioxide and chlorine, are formed from decay of food stored in such refrigerators in such quantities that they have a hnrmfnl effect in tainting foods and reducing nutritiye Yalue thereof, whereas in non-mechanical refrigerators Syllabus 25F. '1'. C. any poisonous gases formed from decay of foous are entirely absorbed by water from melting ice and carried away through drain pipes thereof, as contrasted with other in which they are not absorbeu but remain In the ice cubes made in such refrigerators, and that gelatinous matter· found in drain pipes of non-nwf'llUnieal refrigerators is formed by absorption of gases emanating from food contained tltPrt'in and (·;trr!ed away by water from the melting Ice, and that in C'ledrie refrigerators ice cubes frozen therein contain same lllattf'r as is contninP!l in drain pipe of the non-meehanicai products;

Facts being, among others, that while there have been instances in which mechanical or electric refrigerating units have developed defects and refrigerant has escaped into food chamber and tainted food contained therein, such cases are relatively very infrequent, and varioufl gases used as aforesaid do not genernllr escnpe from the coils as above set forth, there is generally no substantial decay or decomposition of foods stored in refrigerators holding a maintained temperature of 50 degrees or lower under usual conditions, type of refrigeration used bas no bearing on formation of gases formed by decny and decomposition, it docs not appear to have been scientifically established to what extent such gases are soluble in water, if o,t all, or to what extent they may be thus absorbed and carried away in drain pipe of the non-m~cbanlcal product, or be absorbed by water in lee cube trays or frost on cooling unit of the mechanical refrigerator, such gases do not form to any substantial or noticeable extent when temperatures are maintained at a point sufficient to inhibit bacterial growth and activity, and under such circumstances have no harmful effect in tainting foods or reducing their nutritive value, and it has not been scientifically determined to what extent contents of drain pipe of non-mechanical refrigerator are made up of gases and odors from food m· from growth of bartf'riu, algae and mol<ls in the pipe itself, and representations to £>ffl'l't that stwh mnttl'r mny be fonntl in ile cnbl's frozl'n in mechanical refrigerator are untrue aml ddiciPnt iu spPI'ific lhnitntion: and (c) Represented that users of electric r<'frlgi'J'atorl'! wonlll not be able to eat food therefrom without tasting other foods ><torl'll in refrigt>rator at same time ;

Facts being, that if two types of food are placed in refrigerator at the !'lnllle time, narrwly, type of foods having characteristic nn<l inherent otlors constantly thrown off, irrel'pective of any process of decomposition or decay, and type of foods which, upon coming in contact with air, absorlls odors already contained therein, transference of odors from former to latter will take place to such extent tllat person consuming same may taste odor of the other, irrespective of type of refrigerator used, and it has not been sdentifically determined to what extent such transference takes place in a non-meehanlcal or in a mechanical refrigerator, users of Iatter protluet will be uble to consume food that·ein without tasting othf'r food,; 1lwrein storPtl, eX!'!'lJt us lil•rl'iunbon• twte!l, nud nutny foods whkh do not absorb odors from others may be consumed by users of the electric or mechanical product without tasting others stored therein at same time;

With tendency and capacity to confuse aud mislead public with respect to true facts us to the relative merits nnd OIJerating factors of non-mechan- THE COOLERATOR CO. 507 50!) Complaint real refrigerutors and mechanical refrigerators, and into erroneous and mistaken beliefs that latter are undesirable and ineffective in use and Jmrmful and dangerous to users thereof, and into purchase of its said non-mechanical p1·oduct by reason of such beliefs thus induced, and thereby to unfairly diwrt trade to it from lts competitors who do not make use of similar statements; to the injury of competition in commerce: lleld, That such acts and practices were to the prejudice of the public and competitors and constituted unfair methods of competition. Before Mr. John J. /{eenan, trial examiner. llfr. J. T. lVelch for the Commission.

Belt & 1Va77ace, of Chicago, Ill., for respondent. Cor.rrLAINT Pursuant to the provisions of an Act of Congress approved September 26, 1014, entitled ".An Act to create a Federal Trade Commission, to define its powers and duties, and for other purposes," the Federal Trade Commission, having reason to believe that The Coolerator Company, a 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 he in the public interest, hereby issues its complaint stating its charges in that respect as follows:

PARAGRAPH 1. Respondent, The Coolerator Company, is a corporation, organized, existing, and doing business under- and by virtue of the laws of the State of Minnesota, with its principal office and Place of business at 50th Avenue W. and ·wadena, in the city o-f Duluth, State of Minnesota. Respondent is now, and has been for some time, engaged in the business of distributing and selling to dealers for resale, in commerce as herein set out, refrigerators using natural or artificial ice as the cooling element therein. PAR. 2. Said respondent, being engaged in business as aforesaid, causes said refrigerators, when sold, to be transported from its office and principal place of business in the State of Minnesota to purchasers thereof located in various States of the United States other ~han the State of Minnesota and in the District of Columbia. There 18 now, and has been at all times since the organization of respondent company, a constant current of trade in commerce in said refrigerators so distributed and sold by the respondent, between and among th0columbia.e various States of the United States and in the District of PAn. 3. Cert.ain persons, partnerships, and corporations have been, and are now, engaged in offering for sale and selling, in commerce as 508 FEDERAL TRADE C0:\11\IISSION DECISIONS Complaint 2G 1!'. '.f. C. hereinabove set out, refrigerators that depend for their cooling processes upon the use of ice that is placed therein fur that purpose. Such refrigerators have been for many years commonly known in the trade and by the public as "non-mechanical" refrigerators and are generally so designated.

Certain persons, partnerships, and corporations have been, and are now, engaged in offering for sale and selling, in commerce as hereinabove set out, refrigerators that do not depend for their cooling processes upon the use of ice that is placed therein for that purpose. Such non-ice-using refrigerators are commonly known in the trade and by the public as "mechanical" refrigerators and are so designated. One type of such mechanical refrigerators depends for its cooling processes upon certain appliances, attachments, and equipment operated by currents of electricity. Mechanical refrigerators of this type are commonly known in the trade and by the public as "electric" refrigerators and are so designated. In recent years, many electric J·efrigerators have been sold to the public and are now in use in large numbers by the public. A substantial portion of the public has expressed, and actually has, a preference for such electric refrigerators over any other type of refrigerators and the number of said electric refrigerators in u~e and operation is rapidly increasing. In the course and conduct of its said business respondent is now, and has been, in competition, in commerce among and between various States of the United States and in the District of Columbia, with other corporations and with partnerships and individuals likewise ~ngaged in distributing and selling such nonmechanical refrigerators in said commerce and is also in competition in said commerce with corporations, partnerships, and individuals distributing and selling in such commerce said mechanical refrigerators, including said electric refrigerators. All of the sellers of the several types of refrigerators are, and have been, in competition, in commerce as hereinabove set out, between and among themselves as to each and all of said types of refrigerators.

PAR. 4. In such competition between the sellers of nonmechanical refrigerators and the sellers of electric refrigerators, one of the con· trolling influences upon the purchasing public is the popular opinion as to the comparative desirability, effectiveness, and safety in actual operation of the said two types of refrigerators. The use of ice in refrigerators has long been pracHced and its Jesir· ability, effectiveness, and safety, such as it may be, is well-known and understood by the purchasing public. Electric refrigerators were only recently invented and introduced into popular use. The publio is not generally so well·informed as to the desirability, effectiveness, THE COOLERATOR CO. 509 Complaint and safety of such electric refrigerators as it is with respect to these qualities in a nonmechanical refrigerator. Sellers and distributors of nonmechanical, or ice-using refrigerators, are interested in, and engaged in, presenting to the purchasing public alf available reasons or arguments against, or tending to lessen, the desirability, effectiveness, and safety of said electric refrigerators . in actual use.

The use of said electric refrigerators destroys, to the extent of the use thereof, the demand for and sale of ice for use in refrigerators. The increasing sale of electric refrigerators has caused the sellers of nonmechanical refrigerators and the sellers of ice for use therein to attempt to create public sentiment adverse to the use of said electric refrigerators.

PAR. 5. To meet the needs of its customers, the same being sellers of non-mechanical refrigerators and sellers of ice for use therein, respondent has compiled, printed, and published a certain booklet Pf. propaganda against the desirability, effectiveness, and safety of electric refrigerators. Said booklet purports to state certain facts .Which respondent claims to have discovered which, it represents, ?emonstrates that electric refrigerators are in actual use undesirable, Ineffective, and unsafe in their effect upon food kept therein and Upon persons eating such food. Respondent names and designates such booklet as "Why Ice is Best ior Refrigeration." In order to ~ake· such propaganda effective in behalf of sellers of non-mecl1anl~al "refrigerators and sellers of ice for use therein, respondent fur- ?Ishes copies of said booklet to its customers to be placed by them, In such ways as they deem most effective, in the hands of members of the purchasing public so as to influence public opinion and create sales resistance against such electric refrigerators und. to· promote and increase the sale of said non-mechanical refdgerators. Respondent also causes the d.istribution of said booklet direct to the members of the purchasing public.

Practically all of the purchasers of non-mechanical refrigerators .from the respondent are manufacturers or distributors of natural or artificial ice, who resell said refrigerators in connection with their sale of ice for use therein. In some instances, several manufacturers and distributors of ice have organized sales agencies, which agencies purchase said. refrigerators f-rom the respondent and resell them to the public for use.

The said booklet is furnished by the respondent to said purchasers, same being manufacturers or distributors of ice, and their respective s~Ies agencies. As furnished to said purchasers, the booklets sometimes do not have imprinted thereon the respondent's name and 510 FEDERAL TRADE C01IMISSION DECISIONS Complaint ~5F. T. C. address but do have imprinted the name and address of the respective purchaser who actually distributes the booklet to members of the public and actually sells respondent's refrigerators to members of the public.

In the ways hereinabove indicated and by reason of the facts above alleged, sellers of ice for use in non-mechanical refrigerators, as well as sellers of such refrigerators, have an interest adverse to the sale of electric refrigerators and are in practical effect in competition with such sellers of electric refrigerators along with the sellers of non-mechanical refrigerators. The purpose and effect of said booklet is the dissemination of misleading and disparaging propaganda in aid of the sale of non-mechanical refrigerators and of ice therefor. PAR. 6. For the purpose and intent, and with the effect of disparaging electric refrigerators sold in commerce, as hereinabove set out, and for the purpose and with the intent and effect of promoting the sale in commerce, as aforesaid, of non-mechanical refrigerators and the sale of ice for use therein, the respondent in such booklet, designated as ""\Vhy Ice is Best for Refrigeration," by use of false and misleading statements or representations, has falsely represented, directly and by implication and inference, among other things: 1. That a temperature of from 45 to 50 degrees is the established or re· .quired standard temperature necessary to be obtained in all types of refrig· era tors for the most satisfactory preservation of foods; 2. That iu mechanical or electric refrig~rntors the proper temperature for the preservation of foods cannot be maintained without detrimentally dis· turbing the natural composition of the air in the refrigerator and the natural .composition of the food;

3. That the various gases used in electric refrigerators as part of the refrigerant escape from the coils in which they are contained, permeate the food chamber and have a deleterious effect on and taint the foods contained in said refrigerator;

4. That foods kept in electric refrigerators lose water, or dehydrate to sucb. an extent that their nutritive properties are impaired, destroying essential parts of the chemical combination of various foods in their natural stnt.e; 5. That foods kept in non-mechanical refrigerators do not deh~drate or lose water, to any extent whatever.

6. That it is possible only with ice to produce the proper temperature con· trol of foods without disturbing the natural composition of the air or food in the refrigerator, and that similar or comparable results can not be obtained by use of electric refrigerators;

7. That certain poisonous gases,· such as sulphur dioxide aud chlorine, are formed from the decay of foods stored in electric refrigerators in such quantities that said gases have a harmful effect in tainting foods and in reducing their nutritive value;

8. That in non-mechanical refrigerators any polsonons gases formed trolll decay of foods are entirely absorbed by the water from the melting ice and are carried away through the drain pipes thPreot, hnt that In electric re- THE COOLERATOR CO. 511 505 Complaint frlgerators such poisonous gases are not absorbed, and said gases remain in the ice cubes made in said refrigerator;

9. That the gelatinous matter found in drain pipes of non-mechanical refl·fgerators is formed from gao;es emanating from food contained therein being absorbed and carried away by the water from the melting ice, and that the ice cubes frozen in an electric refrigerator contain the same matter as is claimed to be contained in the drain pipe of a non-mechanical refrigerator; and, 10. That the users of electric refrigerators will not be able to eat food therefrom, without tasting other food that was stored in the refrigerator at the same time.

PAR. 7. In truth and in fact a temperature of from 45 to 50 degrees is not an established or required standard temperature for the c preservation of goods, Foods are generally better preserved at a temperature of from 40 to 45 degrees. In truth and in fact it is possible and practical to use electric refrigerators in such a manner that the proper temperature for the preservation of foods can be lnaintained without detrimentally disturbing the natural composition of the air in the refrigerator or the natural composition of the food therein. The various gases anu liquius useu as refrigerants in electric refrigerators do not escape from the coils in which they are contained, do not permeate the food chamber anu do not have a deleterious effect on or taint the foods contained in electric refrigertors. In truth and in fact foods kept in electric refrigerators, and in the proper apliances and attachments furnished there- With, uo not lose water or dehydrate to such an extent that their nutritive properties are impaired or that essential parts of their chemical combination in the natural state are destroyed. A great number of foods, when kept in an electric refrigerator, do not uehydrate to any noticeable or harmful extent. FooLls kept in nonlneehanical refrigerators do dehydrate or lose water to a certain extent. A proper temperature control of foods can be maintained With refrigerants other than ice, 'vithout uistnrbing the natural composition of the air or of the foods themselves. Poisonous gases: such as sulphur dioxide and chlorine, are not formed from the decay of foods stored in electric refrigerators in such quantities, if at all, that said gases have any harmful effect in tainting foods or have any harmful effect on the eaters of such foods. In truth anu in fact ho poisonous gases are formed from the decay of foods when the tPtnperature of the refrigerator is properly controlled and such ?uses as may be formed from the decay of said foods are not harmful lll the quantities found, and are not generally absorbed by the ice cubes made in said electric refrigerators. The gelatinous matter formed in the urain pipes of non-mechanical refrigerators is not formed from any gases thrown off by foods containeu in sniu re- 158121'"-39-35 512 FEDERAL TRADE COl\'Il\IISSION DECISIONS Findings 25 F. T. C. frigerators. In truth and in fact the ice cubes made in an electric refrigerator do not contain the same gelatinous matter contained in the drain-pipe of a non-mechanical refrigerator. The users of electric refrigerators are able to eat food therefrom without tasting the other foods stored therein.

PAR. 8 The aforesaid false, misleading and disparagin~ representations so made in respondent's booklet, "'Vhy Ice is Best for Refrigeration," as above alleged, have had, and now have, the tendency and capacity to mislead and deceive a substantial portion of the purchasing public into the false and erroneous beliefs that said statements are true and that electric refrigerators are uncledesirable, ineffective, and harmful in the ways alleged and are dangerous to the eaters of food kept in said refrigerators, and that the statements and representations made by respondent with reference to non-mechanical refrigerators and the results to be obtained from a use thereof are true. Further, said false and misleading statements and representations have the tendency and capacity tot and do, divert trade to the sellers of non-mechanical refrigeratorst including the respondent and its customers, from sellers of electric refrigerators and induce the public to purchase non-mechanical refrigerators and ice to be used therein, in and because of such erroneous beliefs brought about as hereinabove set out. As a result thereof, substantial injury has been, and is now, being done by respondent to substantial competition in commerce among and between various States of the Uniteu States anu in the District of Columbi<t- PAR. 9. The above and foregoing acts, practices and representations of the respondent have been, and are, all to the prejudice of the public and respondent's competitors, as aforesaid,· and have been, and are, unfair methods of competition within the meaning and intent of Section 5 of an Act of Congress approved September 26t 1914, entitled "An Act to create a Federal Trade Commission, to define its powers and duties, and for other purposes." REPORT, FINGINGS AS TO THE FACTS, AND ORDER Pursuant to the provisions of an Act of Congress approved Sep· tember 26, 1914, entitled "An Act to create a Federal Trade Conl· mission, to define its powers and duties, and for other purposes," the Federal Trade Com.mission on April 16, 1936 issued and served its complaint in this proceeding upon respondent, The Coolerator Company, 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 THE COOLERATOR CO. 513 50!3 Findings thereto, testimony and other evidence in support of the allegations of said complaint were introduced by J. T. ·welch, attorney 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 William 0. Belt and Robert K. Belt, Charles Aaron, and Franklin Raber, and Jay P. Taggart, attorneys for the respondent; and said testimony 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 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 such statement of facts and upon the evidence and testimony theretofore 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 I>roceeding regularly came on for final hearing before the Commission on said complaint, the answer thereto, the 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 considered the same and being 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 dra·wn therefrom: FINDINGS AS TO Tile FACTS P ARAORAPH 1. &spondent, The Coolerator Company, is a cor- Poration, organized in 1928 under the laws of the State of Minnesota. as The Duluth Refrigerator Company. Its corporate name was subsequently changed to The Coolerator Company. Its principal office and place of business is located at Fiftieth Avenue, 'Vest and Wadena in the city of Duluth, State of Minnesota. Since its incor- Poration, it has been, and now is, engaged in the business of distributing and selling to retail dealers for resale refrigerators using natural or artificial ice as the cooling element therein. PAn. 2. The Coolerator Company causes said refrigerators, when ~old, to be transported from its office and principal place of business 111 the State of Minnesota, or from one of its warehouses, to purchasers thereof located in various States of the United States other th~n the State of Minnesota or other than the State of the origin of said shipment and in the District of Columbia. Respondent's cus- 514 FEDERAL TRADE COllfl\USSION DECISIONS I•' in dings 25 F. T. C. tomers are located in every State of the Union and. in many foreign countries. The purchasers of said refrigerators in tum sell them to the members of the purchasing public for commercial and domestic use. The Coolerator Company has, at all times since its incorporation, maintained a <;pnstant current of trade in said refrigerators so uistributed and sold. by it in commerce between and among the various States of the United States and. in the District of Columbi:t. In the year 1932, it sold. approximately 9,000; in 1933, approximately 15,000; in 1934, approximately 35,000; in 1!>35, approximately 70,000; and from October 1, 1935 to July 1, 19:36, approximately 85,000. Tha retail sale price of respondent's refrigerators designed for domestic use ranges from $30.00 to $175.00 per unit. PAR. 3. There are two distinct types of refrigeration: one known as ice or non-mechanical refrigeration and the other as mechanical refrigeration. The refrigerators employing these two types of refrigeration are respectively referred to hereinafter as non-mechanical and mechanical refrigerators. In both types, the refrigeration is accomplished by use of an insulated cabinet in which the refrigerant is installed. In a non-mechanical refrigerator either natural or artificial ice is placed in a compartment known us the ice chamber. The melting of the ice absorbs the heat from the air as it circul<ttes past the ice and through the food chamber. In a mechanical refrigerator, an apparatus known as a cooling unit or coil is installed in the food chamber and refrigeration is obtained by forcing a volatile gas under.r pressure through the soil. As this gns passes through the coil, it absorbs the heat from the air in the foorl chamber that comes in contact with the coil. Although nwchanical rl!frigeration is a comparatively recent invention and has bern in HSO a comparatively short period of time, it has developed in popularity and is widely used throughout the United States as a method of refrigeration. The manufacture and sale of various types of mechanical refrigemtors has developed into a large industry. One type of such mechanical refrigerators depends upon certain appliances, attachments and equipment operated by electricity for its cooling processes.

l)AR. 4. Other corporations have been, and are now, likewise engaged in offering for sale and selling refrigerators that depend upon the use of ice for their cooling processes and which retail for ap· proximately the same amount as respondent's refrigerators. Among buch are: Raney Refrigerator Company, Ice Cooling and Appliance Corporation, Progress Refrigerator Company, Tennessee Furniture Company, and l\fcKee Refrigerator Company. THE COOLERATOR CO. 515 Findings Other corporations have been, and are now, engaged in offering for sale ancl selling, refrigerators that depend upon the use of substances other than ice for their cooling processes and which retail from approximately $100.00 to $300.00 each. Among such are: Kelvinator Corporation, Frigidaire Corporation, General Electric Company, and \Vestinghouse Electric & Manufacturing Company. The corporations and firms hereinabove named, and others not specifically named, which sell refrigerators, either non-mechanical or ntechanical, ship said refrigerators, when orders therefor are received, from their respective places of business or warehouses to the purchasers thereof located in States other than the State in which said places of business or warehouses are located, or other than the State ft·om which the respective shipments originate. In the course and conduct o£ its business, The Coolerator Company is engaged in substantial competition, in commerce among and betw~n the various States of the United States and in the Di~trict of Columbia, \with many corporations and with partnerships and individuals, including those herein named, likewise engaged in (listributing and selling non-mechanical refrigerators in said com- InPrce; and is also in substantial competition, in said commerce, 'with many corporations, partnerships, and individuals, including 1hose herein named, likewise engaged in distributing and selling in such commerce mechanical or electric refrigerators. PAR. 5. In such competition between the sellers of non-mechanic!tl refrigerators and the sellers of mechanical or electric refrigerators, 011e of the controlling influences upon the purchasing public is the Popular opinion as to the comparative desirability, effectiveness and safety in actual operation of the two types of refrigerators. The llse of ice in refrigerators has long been practiced and its desirability, effeetiveness and safety as a method of refrigeration are well known and understood by the purchasing public. Because of its ~ornparatively recent invention, the public is not generally so well ~nformed as to the desirability, effectiveness and safety of mechan- ~cal or electric refrigerators as it is with respect to these qualities In non-mechanical refrigerators.

PAR. 6. In advertising the non-mechanical refrigerators which it ~sells, and for the purpose of promoting the sale of said refrigerators Y retail dealers, The Coolerator Company has made use of booklets, f?lders, circulars and other advertising literature, some of which it distributes to members of the purchasing public located in the various States of the United States, and some of which it furnishes to its customers, to be by them placed in the hands of members of the Findings 25F.T.C.

purchasing public. It has also made use of advertisements inserted in newspapers and magazines having a general circulation throughout the various States of the United States. It has also, in the past, made use of a certain booklet entitled "Why Ice is Best for Refrigeration." This booklet was first published and distributed by the respondent in the year 1930 and was also published in each succeeding year until 1935. In the fall of 1935, the respondent discontinued tho publication of said booklet and since that time no copies have been published by it. The distribution of said booklet was discontinued about the middle of the year 1936 and has not been resumed. Approximately 150,000 copies of this booklet were published and distributed each year.

In said booklet entitled "Why Ice is Best for Refrigeration," the respondent, by direct statement and by implication, made the following representations:

1. That a temperature of from 45 to 50 degrees is the fjlstablished or required standard temperatures necessary to be obtained in all types of refrigerators for the most satisfactory preservation of foods; 2. That in mechanical or electric refrigerators the proper temperature for the preservation of foods cannot be maintained without detrimentally disturbing the natural composition of the air in the refrigerator and the natural composition of the food; 3. That the various gases used in electric refrigerators as part of the refrigerant escape from the coils in which they are contained, permeate the food chamber and have a deleterious effect on and taint the foods contained in said refrigerator;

4. That foods kept in electric refrigerators lose water, or dehydrate to such an extent that their nutritive properties are impaired, destroying essential parts of the chemical combination of various foods in their natural state;

5. That foods kept in non-mechanical refrigerators do not dehydrate or lose wnter, to any extent whatever; 6. That it is possible only with ice to produce the proper temperature control of foods without disturbing the natural composition of the air or food in the refrigerator, and that similar or comparable results can not be obtained by use of electric refrigerators; 7. That certain poisonous gases, such as sulphur dioxide and clliorine are formed from the decay of foods stored in electric refrigerators in such quantities that said gases have a harmful effect in tainting foods nnd in reducing their nutritive value; 8. That in non-mechanical refrigerators any poisonous gases formed from decay of foods are entirely absorbed by the water from the melting ice and are carried away through the drain pipes there· THE COOLERATOR CO. 517 505 Findings of, but that in electric refrigerators such poisonous gases are not absorbed, and said gases remain in the ice cubes made in said refrigerators;

9. That the gelatinous matter found in drain pipes of non-meehanical refrigerators is formed from gases emanating from food ~contained therein being absorbed and carried away by the water from the melting ice, and that the ice cubes frozen in an electric refrigerator contain the same matter as is claimed to be contained in the drain pipe of a non-mechanical refrigerator; 10. That the users of electric refrigerators will not be able to eat food therefrom, without tasting other food that was stored in the refrigerator at the same time .

. Certain other advertising literature distributed by the respondent ln commerce among and between the various States of the Uniteu States contains language which may serve as representations to the same effect as some of the representations hereinabove set out. PAn. 7, A temperature of from 45 to 50 degrees Fahrenheit is not the established or required standard temperature necessary to be obtained in all types of refrigerators for the most satisfactory Preservation of food and those temperatures have not been established as a standard in the industry or among doctors and footl experts generally. At this time, there appears to be no established or required standard temperature necessary to be maintained in all types 'Of refrigerators for the most satisfactory preservation of food. Doctors and food experts are not now entirely in accord on the question of the temperatures required in order to most satisfactorily preserve food stored in refrigerators. Such temperatures as Will produce the desired preservation of food are not limited, however, to the range between 45 to 50 degrees Fahrenheit and food can Properly be preserved at temperatures lower than 45 degrees Fahrenheit. The temperature necessary to preserve food depends, in part, Upon the character of the food and the length of time it is to be preserved. Some foods will keep longer under a given temperature than other foods. It is generally understood and agreed by experts that a lllaintr: ~ned temperature of 50 degrees Fahrenheit or lower will prope;Iy preserve perishable foods in an edible condition for the length of hlh.e that such foods are ordinarily kept for human consumption in a dolh.estic refrigerator. Spoilage of food, so far as its edibility is ?concerned, takes place when it is dehydrated to such an extent that ~t becomes desiccated, or when there is excessive bacterial growth ln or on the food. The rate and extent of dehydration, as well as of bacterial growth, depend upon the character of the food, the tetnperature, the relative humidity and the length of time the food Findings 25 F. T. C. 1s kept. A maintained temperature of 50 degrees Fahrenheit or lower is generally sufficient to retard the growth of bacteria and preserve perishable foods in an edible condition for the length of time that such foods are ordinarily kept for human consumption in a domestic refrigerator. The representation to the effect that a temperature of from 45 to 50 degrees is the established or required standard temperature necessary to be obtained in all types of re~ frigerators for the most satisfactory preservation of food is sus~ ceptib1e of the mistaken meaning that those temperatures have been established as a standard in the industry and that a temperature of 45 degrees is the minimum temperature at which foods may properly be preserved in a refrigerator contrary to the facts. PAR. 8. The natural composition of air is a mixture of nitrogen, oxygen, carbon dioxide, certain rare gases and water vapor. The water vapor or moisture content is the only factor involved in thig proceeding. Air containing the maximum amount of moisture it can hold at a given temperature is said to be saturated or at 100% relative humidity. Air containing less moisture than it is capable of holding is unsaturated. Its degree of saturation at a given temperature is expressed by the ratio of its actual moisture content to its maximum possible moisture content divided by 100 and is expressed as percent relative humidity.

The quantity of water vapor or moisture content in the air is variable, depending upon the temperature of the air, the amount of available moisture and the temperature of the surrounding medium: with which the air comes in contact. Until air reaches the saturation point, it has a tendency to absorb moisture from any moisture laden S'lbstance with which it comes in contact if the temperature of the substance is at the temperature of the air or at a higher tempern.ture than the air. The higher the temperature of the air, the greater its capacity to hold moisture. Further, at any temperature, liquid water if it is at the same temperature or warmer than the surrounding air can evaporate into the surrounding air mixture until such air becomes saturated. Such process of taking up moisture by air is generally known as dehydration since this is the effect on the substance from which the water is taken. For the purpose of determiw ing moisture loss the temperature of the air in a refrigerator is principally controlled by the temperature of the cooling medium, the temperature of the food and the temperature of any air coming into th~ refrigerator when opened. The cooling medium of a refrigerator, bemg colder than the air which passes it, chills the air and in so doing reduces its capacity to hold moisture. The air leaving the cooling element is at or near saturation (100% relative humidity) but it THE COOLERATOR CO. 519 505 Findings carries less moisture than it did before contacting the cooling ele- :ment because it is at a lower temperature. The surplus moisture is condensed on the surface of the cooling element (as water when ice is used or as water or frost when a mechanically cooled coil is used). As the air passes through the refrigerator, it warms up. In so doing it regains its capacity to carry moisture and its relative humidity decreases. As this air passes over foods containing moisture, it picks up moisture in an amount which is dependent upon its relative humidity, the difference between the temperatures of the substances it contacts and the type and area of the substances or food surfaces exposed. "\Vet surfaces and leafy foods such as lettuce or celery give Up moisture readily while foods protected by rinds or heavy skins give up moisture slowly.

Air at any given temperature requires a greater quantity of water to raise it from any given degree of saturation (percent relative humidity) to any other given degree of saturation than does air at any lower temperature and the same degree of saturation. For example: At a temperature of 40. degrees Fahrenheit and 40% relative humidity, air can hold approximately 0.002 lb. of water per lb. <>f dry air. At saturation point air at the same temperature can hold approximately 0.00525 lb. of water per lb. of dry air. In raising the relative humidity from 40% to saturation, 0.00325 lb. of water Per lb. of dry air must be added.

At a temperature of 50 degrees Fahrenheit and 40% relative humidity, air can hold approximately 0.0031 lb. of water per lb. of dry air. At saturation air of the same temperature can hold approximately 0.007G5 lb. of water per lb. of dry air. In raising the relative humidity from 40% to saturation, 0.00455 lb. of water per lb. of dry air must be added. By increasing the initial relative humidity of the 50 degrees Fahrenheit air to 150%, we find that the air can hold 0.0038 lb. of water per lb. of dry air. In raising the relative humidity from 50% to saturation, 0.00385 lb. of water per Pound of dry air must be added. Thus, air at 50 degrees Fehrenheit and 50% relative humidity requires more water to raise it to baturation than does air at 40 degrees Fahrenheit and 40% relative humidity. The amount of water foods in a refrigerator can lose flepencls also upon how fast the 'vater is evaporating from the foods _(rate of evaporation) and the length of time the foods are kept In the refrigerator. The rate of evaporation from a substance de- Pends principally upon the difference between the vapor pressure ?f the water in the substance and the vapor pressure of the moisture In the air. The vapor pressure of the water in the substance is gentl'ally the same as the temperature of the substa.nce. The vapor Findings 25F.T.C.

pressure of the air is its saturation moisture content {dew point temperature). "\Vhen foods are placed in a refrigerator for a sufficient time to cool down to the temperature of the air, the vapor pressure of the water in the substance and the vapor pressure of the moisture in the air become substantially equal. Because of the operation of the foregoing principles, the amount of moisture that can be taken up to bring air from any degree of saturation to its saturation point depends on the temperature of the air, its relative humidity and the rate of evaporation. In view of the foregoing, under certain conditionst there will be no greater dehydration in a mechanical refrigerator than in a non-mechanical refrigerator even though the relative humidity of the air therein is lowert because the differences in the vapor pressures of the substances and the vapor pressures of the air in the two types of re- :frigerators will be substantially ~qual.

Dehydration of food takes place in both mechanical or electric refrigerators and non-mechanical or ice refrigerators to a varying nmountt depending upon the various factors herein set out. Ex· cessive dehydration of food affects its appearance and its texture, and makes it less appetizing, even though it cloPs not affect its nutritive ,properties. In an effort to overcome the factor of dehydration, manufacturers of mechanical or electric refrigerators have provided covered containers which are placed in the food thamber. These containers are not, however, standard equipment in all makes or types of mechanical or electric refrigerators. Foods that are readily susceptible to dehydration, like leaf vegetablest are placed in these covered containers, when provided, so that the air ns it circulates in the food chamber does not come in direct contact with that food. By the use of these covered containers the de· hydration of foods stored therein has been practically eliminated, and the dehydration that takes place in food stored in covered containers is substantially less than it would be if the same foods were stored in the open food compartments of a mechanical or electric refrigerator, or a non-mechanical or ice refrigerator. Such containers may also readily be used in non-mechanical or ice refri~erators with comparable results.

The representations of the respondent set out in sub-sections 2, 4, 5, and 6 of paragraph G hereof are too general, are lacking in specific limitation, are misleading and, in aome instances, are not true. Proper temperatures for the satisfactory preservation of foods usu· ally kept in mechanical refrigerators for domestic use can generally be maintained without detrimentally disturbing the natural compo~ sition of the food. Foods stored in mechanical refrigerators for the THE COOLERATOR CO. 521 305 Findings length of time that foods are ordinarily and customarily stored in refrigerators when intended for domestic use do not dehydrate or lose wttter to such an extent as to impair their nutritive properties or to destroy the essential parts of the chemical combinations thereof. Foods kept in non-mechanical refrigerators do dehydrate or lose Water to some extent, depending upon the factors herein set out. Refrigeration by use of ice as a refrigerant or by use of other l'efrigerunts does disturb the natural composition of the air in a refrigerator. The extent of this disturbance depends upon the variable factors above referred to, but in refrigerators of both types, the extent of this disturbance is not generally sufficient to affect the natural composition of the food stored in the refrigerator to such an extent as to make it undesirable for human consumption. It is possible by use of refrigerants other than ice, as well as by use of ice, to produce the proper temperature control of foods without disturbing the natural composition of the air or the food in the refrigerator to any harmful extent.

The refrigerants most commonly used in mechanical or electric t·efrigerators are: sulphur dioxide, 802, dichloro diflura methane, CCl2F 2, commonly known as FrPon or Freon12, dichlorotetra fluorethane, C2Cl2F 4 , or certain derivatives, and dichloro methane DH2Cl2, commonly known as Carrene. The refrigerant most commonly llsed is sulphur dioxide which is a corrosive and suffocating gas. however, in recent years, certain of the manufacturers of mechanical or electric refrigerators luwe used and are now using Freon, or other derivatives, and Carrene, none of which are corrosive or suffocating gases, as refrigerants. These refrigerants, when placed in the refrigerating unit of a mechanical or electric refrigerator, are under pressure as they pass through the cooling unit on the inside of the food chamber and if there is any defect in the tubing or in the connection from carelessness or misuse, these refrigerants may be forced out into the food chamber. There have been instances in which mechanical or electric refrigerating units have developed defects either as a result of construction or of improper use and in which the refrigerant has escaped into the food chamber and tainted the food contained therein. Such cases, however, are very infrequent considering the number of Units in use.

The various gases used as refrigerants in mechanical or electric refrigerators do not generally escape from the coils into the food chamber and taint the foods contained therein. The representation stating or implying that the various gases used as refrigerants in mechanical or electric refrigerators escape from the coils into the food chamber and taint the foods contained therein Findings 25 F. T. C. is too general and is deficient in specific limitation as to the conditions under which the refrigerant may escape. PAR. 9. There is generally no substantial decay or decomposition of foods that are stored in refrigerators holding a maintained temperature of 50 degrees Fahrenheit or lower when such storage is for the relatively short period of time usually encountered in the use of refrigerators for domestic use. At maintained temperatures below 50 degrees Fahrenheit, bacterial growth and activity are gent>rally inhibited and the lower the temperature, the greater the capacity to inhibit such activity. Bacterial growth or activity is the primary cause of the decay or decomposition of food and various gases are formed by such decay and decomposition. The type of refrigeration used has no bearing on the formation of such gases. The extent to which these gases may be formed depends on the length of time the food has been separated. from its source, upon the temperature at which it has been preserved, and upon the relative humidity of the air. Some of these gases are poisonous. The nature of the gases thus formed depends on the type of food and the type of bacteria involved. Such gases as may be formed from the decay or decomposition of food do not include sulphur dioxide or chlorine though they may include hydrogen sulphide and various chlorides and some, though not all of them, may be partially soluble in water. When food decays or decomposes, the gases thus formed may be given off into the air and be absorbed to a certain extent by other foods. In a non-mechanical refrigerator, a certain portion of those gases which may he soluble in. water may be absorbed by the water from the melting ice as the air passes it and then carried down the drain pipe. In mechanical refrigerators, except as herein later discussed, a certain portion of those gases which may be soluble in water may be absorbed by the water in the ice cube trays and the frost on the cooling unit. It does not appear to have been scientifically established to what·extent such gases as may be formed from food decay are soluble in water, if at all, and to what extent they may be absorbed by the water and carried away in the drain pipe of a non-mechanical refrigerator, or to what extent they may be absorbed by the water in the ice cube trays or the frost on the cooling unit of a mechanicn1 refrigerator.

The representations by the respondent set out in sub-sections 1 and 8 of paragraph 6 hereof are deficient in specific limitation, indefinite, exaggerated and untrue in the particulars above set out. Such gases as may be formed from the decay or decomposition of foods are not formed to any substantial or noticeable extent when temperatures are maintained at a point sufficient to inhibit bacterial THE COOLERATOR CO. 523 505 Fimlings growth and activity and under such circumstances do not have any harmful effect in tainting foods or in reducing their nutritive value. PAR. 10. The gelatinous mass sometimes found in the drain pipe of non-mechanical refrigerators is made up of gases and odors emanating from food and from the growth of bacteria, alga-e and mold in the drain pipe itself. It has not been scientifically determined to what extent th~ contents of the drain pipe of a nonmechanical refrigerator are made up from gases, odors and bacteria emanating from the food or to what extent the contents are made up of growth of bacteria, algae and molJs taking place in the drain pipe itself. The gelatinous matter found in a drain pipe of a nonmechanical refrigerator will not be found in ice cubes frozen in a mechanical refrigerator. The growth of bacteria, algae and molds Which may take place in the drain pipe of a non-mechanical refrigerator cannot take place in the cube trays or on a cooling unit of a mechanical refrigerator under normal operating conditions. The representations to the effect that the gelatinous matter found in the drain pipes of non-mechanical refrigerators may be found in ice cubes frozen in a mechanical refrigerator are untrue and are deficient in specific limitation.

M:any mechanical refrigerators are equipped with covers over the cube trays or with doors to the cube tray compartment of the cooling units as standard equipment. Some mechanical refrigerators do not have such equipment. In those types of mechanical refrigerators Which do have such equipment, there is, for all practical pur- Poses, no flow of air from the food chamber through the cube com- Partment of the cooling unit that can come in direct contact with the water in the cube trays. For that reason, there is, for all practical purposes, no absorption by the water in the cube trays of gases that may be fonned from the decay or decomposition of foods in the food chamber or of any food odors.

PAR. 11. There are certain foods that have characteristic and inherent odors which are constantly being thrown off into the air, irrespective of any process of decomposition or decay. There are certain other foods which upon coming in contact with air will absorb odors already contained therein. I£ these two types of foods are Placed in a· refrigerator at the same time, the foods which have a tendency to absorb odors will absorb such odors of the other footl to such an extent that a person eating such foods may taste the odor of the other foods. This transferring of odors from one food to ~another will take place in refrigerators of any type to a certain extent. t ha~ not been scientifically determined to what extent this takes Place in a non-mechanical refrigerator or in a mechamcal refrigerator. Order 2rif.T.C.

Users of mechanical or electric refrigerators will be able to eat the food stored therein without tasting other foods that "·ere stored in the refrigerator at the same time except as to the type of food in which such transference of odors does actually take place. .Many foods, however, do not absorb odors from other foods and as to those foods, users of electric or mechanical refrigerators may eat said foods without tasting other foods that were stored in the refrigerator at the same time.

PAR. 12. The aforesaid acts and practices of the respondent in making the representations hereinabove detailed, in selling and promoting the sale of its non-mechanical refrigerators, have had, and now have, a tendency and capacity to confuse and mislead the public with respect to the true facts as to the relative merits and operating factors of non-mechanical refrigerators and mechanical refrigerators and into the erroneous and mistaken beliefs that mechanical refrigerators are undesirable and ineffective in use and are harmful .and dangerous to the users thereof, and into the purchase of respondent's non-mechanical refrigerators on account of said beliefs induced as aforesaid. As a result thereof there has been, and is, a capacity and tendency to unfairly divert trade to the respondent from its competitors who do not make use of similar statements, to the injury of competition in commerce among and between the various States ot the United States.

CONCLUSION The aforesaid acts and practices of the respondent, The Coolerator Company, are to the prejudice of the public and of respondent's com· petitors, 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 Co111· mission upon the complaint of the Commission, the answer of respondent, testimony and other evidence taken before John J · Keenan, an examiner of the Commission heretofore duly designated by it, in support of the allegations of said complaint and in opposition thereto, and a stipulation as to the facts executed by ,V. T. Kelley, Chief Counsel of said Commission and the respondent, and the Commission having made its findings as to the facts and its conclusion that said respondent has violated the provisions of au Act of Congress approved September 26, 1914, entitled "An Act THE COOLERATOR CO. 525 505 Order to create a Federal Trade Commission, to define its powers aml duties, and for other purposes."

It i8 ordered, That the respondent, The Coolerator Company, a corporation, its officers, servants, employees, agents, and representatives, in the course of the sale and distribution in interstate commerce of non-mechanical, or ice refrigerators, cease and desist from representing:

· 1. That a temperature of 45 to 50 degrees Fahrenheit is the established or required standard temperature necessary to be obtained in any or all types of refrigerators for the most satisfactory preservation of food; provided that the respondent is not hereby prohibited from representing that a maintained temperature of 50 degrees Fahrenheit, or lower, in a domestic refrigerator is a generally satisfactory temperature for the preservation of perishable foods usually kept in refrigerators for domestic use; 2. That in mechanical refrigerators a proper temperature for the preservation of foods cannot be maintained without detrimentally disturbing the natural composition of the air in the refrigerator or the natural composition of the food; provided that the respondent is not hereby prohibited from representing that the natural composition of air in both non-mechanical and mechanical refrigerators, e:x:cept the air in hydrators or covered containers, is changed to the e:x:tent that its moisture content is diminished in the process of refrigeration and that the natural composition of certain foods stored in all refrigerators is affected to the extent to which moisture ii absorbed by the air coming in contact with said foods; 3. That the various gases used in mechanical refrigerators as part of the refrigerant escape from the coils in which they are contained, permeate the food chamber and have a deleterious effect on and taint the food therein; provided that the respondent is not hereby prohibited from representing that sulphur dioxide is one of the gase!:' commonly used as a refrigerant in stated or specified mechanical refrigerators; that it is a poisonous gas and that if it should escape from the coil in the refrigerating unit, it might permeate the food chamber and have a deleterious effect on and taint the foods contained therein· ' 4. (a) That foods kept in mechanical refrigerators lose water or ?ehydrate to such an extent that. their nutritive properties are lmpaired and essential parts of the chemical combinations of various foods in their natural state destroyed; and (b) that foods kept in a non-mechanical refrigerator do not dehydrate or lose water to any ~~t~nt whatever; provided that the respondent is not hereby prolhited from representing to what extent, under stated conditions, FEDERAL TRADE COl\I:MISSION DECISIONS 526 Order 25 F. T. C. certain specified foods kept in a non-mechanical refrigerator dehydrate or lose water and to what extent, under the same conditions, the same specified foods kept under comparable conditions in a mechanical refrigerator dehydrate or lose water; 5. That sulphur dioxide or chlorine is formed from the decay of foods contained in mechanical refrigerators; 6. That poisonous or other gases are formed from the decay of foods stored in mechanical refrigerators in such quantities that they have a harmful effect in tainting said foods and in reducing their nutritive value;

7. (a) That in a non-mechanical refrigerator, such poisonous or other gases as may be formed from the decay of foods are entirely absorbed by water from the melting ice and are carried away through the drain pipe thereof, but that in mechanical refrigerators such poisonous or other gases as may be formed from the decay of foods remain in the ice cubes made in said refrigerators and are not absorbed and carried away; and (b) that the gelatinous matter found in the drain pipe of a non-mechanical refrigerator is formed solely and entirely or principally from gases emanating from foods contained therein being absorbed and carried away by the water from the melting ice and that the ice cubes frozen in a mechanical refrigerator contain the same matter contained in the gelatinous matter found in the drain pipe of a non-mechanical refrigerator; 8. That the users of mechanical refrigerators will not be able to eat the food therefrom without tasting such other food that was stored in the refrigerator fit the same time; provided that the respondent is not hereby prohibited from representing what foods, under stated conditions, give off odors and what foods will absorb such odors and to what extent such transferring of odors from one food to another will take place.

It is further ordered, That the respondent shall, within 90 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.

ROGERS CANDY CO. 527 Syllabus