Elite Glove Company, Inc.

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IN THE MATTER OF ELITE GLOVE COMPANY, INC.

'CO~IPLAINT, l•'INDINGS, AND OHDEll IN UEGARD TO Tile ALLEGED VIOL.\TION 01~ SEC. 5 OF AN ACT OJ!' CONGRESS APPROVED SEI'T. 26, l!H4 DocT•et 3187. Complaint, July 24, 1937-Decision, Nov. 3, 1937 Where a corporation eugageu iu mauufacture, fale, anu distribution of gloves, in commerce among the various States and in the District of Columbia, in substantial competition with others similarly engaged, and including among such competitors manufacturers aud distributors of like and similar products who truthfully advertise and represent the nature, merit, and origin of tliCir respective products fill(} refrain from advertising or representing, through catalogs, brand marks, or other advertising media, that the mer· chandise offered by them has a merit, value, and origin which it does not have; in advertising its said prouuct through price lists, newspapers, Periodicals and otlter advertising matter circulated through the mails to its customers and prospective customersllepresented, through used of word "British," and through sale and distribution of gloves with surh brands as "Lady Daphne A British Doeskin M.\DE IN U. S. A." and "Lady Daphne A British Suede MADE IN U. S. A.," that the leather used in the manufacture thereof was processed or made into the finished lcatllCr In England, such as long distinctly preferred by a substantial part of the consuming public in gloves, shoes, and other per· sr.~Jal wearing efTccts, and was imported therefrom into the United States, facts being the hides Uf;ed in making its said products were imported from the Sudan of Egypt into the United States, and there tanned and processed into finished leather product;

With result of misleading customers and prospective customers into the belief that leather in question was processed into finished leather product in England and imported therefrom into the United States and there made Into gloves, and with tendency and capacity to mislead substantial portion of consuming public into erroneous belief that all of its said representa· Uons were true with respect to its ~;aid products, and source or origin of. materials entering into manufacture thereof, and into purchase thereof on account of such belief, and with result that trade was diverted to lt from competitors engaged in similar businesses as hereinbefore set forth; li to Ute substantial in.lury of competition in commerce: cld, That Ruch nets and practices were to the prejudice of the public and competitors and constituted unfair methods or compPtltion. Mr. S. Brogdyne Teu, II for the Commission. Mr. II. Andrew Schlu8berg, of Gloversville, N. Y., for respondent. Complaint S :Pursuant to the provisions of an Act of Congress, approved "epternbcr 26, 1914, entitled "An Act to create a Federal Trade Commission, to define its powers and duties, and for other purposes," 1306 FEDERAL TRADE COMl\HSSION DECISIONS Complaint 25 F. T. C. the Federal Trade Commission, having reason to believe that Elite Glove Company, Inc., a corporation, hereinafter referred to as respondent, has been and is now using unfair methods of competition in commerce, as "commerce" is defined in said act of Congress, and it appearing to said 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: PARAGRAPH 1. Respondent, Elite Glove Company, Inc., is a cor· poration organized and doing business under the laws of the State of New York, and having its principal place of business in the city of Gloversville, State of New York. It is now, and for more than one year last past has been, engaged in the manufacture, sale, and cUstribution of women's purses and gloves in commerce between and among the vario11s Statt's of the United States and in the District of Columbia.

PAR. 2. 'Vhen said products are sold, respondent transports o1· causes the same to be transported from its principal place of business in the city of Gloversville, State of New York, to purchasers thereof located in other States of the United States and in the District of Columbia.

There is now, and has been at all times mentioned herein, a constant current of trade and commerce in said above described prod· ucts sold by respondent between and amo11g 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, and with individuals, partnerships, and firms likewise engaged in the business of manufacturing, selling, and distributing women's purses and gloves in commerce among and between the Yarious States of the United States and in the District of Columbia. PAR. 4. In the course and conduct of its said business, and for the purpose of inducing the purchase of its products, respondent has caused to be printed and circulated through the United Stairs mails, to its customers and prospective customers in the yarious States of the United States, catalogs, price lists, and other printed matter.

The respondent has also caused and still causes advertisements to be inserted in newspapers and magazines having a general interstate circulation. And further, it has caused and still causes to be imprinted on said finished products and on the containers thereof as herein set out words and plu·ases purporting to be descriptive of its said product. Among the statements made in the aforesaid catalogs, price lists, newsp11pers, and magazine advertisements, and ELITE GLOVE COMPANY, INC. 1307 1305 Complaint among the words and phrases imprinted on respondent's said prodnets, and upon the containers thereof, the following are representative: 1. Lady Daphne A British Doeskin MADE IN U. S. A.

2. Lady Daphne A British Suede MADE IN U. S. A.

In the above set out quoted representations appearing on respondent's products the old English letters in the words "La(!y Daplme-A Dritish Doeskin" and "Lady Daphne-A British Suede" are approximately three times the size of the letters, all capitals, in the phrase ''Made in U.S. A." The words appearing in large type Old English as contrasted with the phrase "Made in U. S. A.," in very much smaller letters, serve to heighten and to unduly stress the words "Lady Daphne-A British Doeskin" and "Lady Daphne-A British Suede."

PAR. 5. All of the foregoing false and misleading statements and representations made by the r~spondellt 1 particularly the use of the Words "Lady Daphne," said words being indicative of English Royalty, in connection with the words "A British Doeskin" or "A Dritish Suede," and the disparity of the size of the letters used there· in as compared to the size of the letters used in the phrase "Made in U. S. A.," serve as representations to customers and prospective customers that the leather used in the manufacture of the respondent's products is processed into a finished leather in England and imported into the United States.

The said representation is further heightened by the use of the phrase "Made in U. S. A." in conjunction with the above set out Words in that it leads customers and prospective customers into the belief that the leather is processed into a finished leather in England and imported into the United States, where it is made into gloves and purses.

PAn. 6. In truth and in fact, the leather used in the manufacture of respondent's products is not processed into a finished leather in England and imported into the United States, but is tanned and processed into finished leather in this country and therefrom made directly into the purses and gloves manufactured by the respondent. PAn. 7. For many years, a substantial part of the consuming public has had, and still has, and has so expressed, a marked preference for purses, gloves, and particularly shoes, and other personal wearing effects made of leather, which are manufactured in England or manu· 1308 FEDERAL TRADE CO:Ml\IISSION DECISIONS Findings 2Gl!'. T.C. factured in this country from leathers processed in England and then imported into the United States.

PAR. 8. There are among the competitors of the respondent in commerce as herein set out manufacturers and distributors of like and similar commodities who truthfully advertise and represent the nature, merit, and origin of their respective products, and who refrain from advertising or representing through their catalogs, brand marks, and other advertising media that the merchandise offered for sale by them has a merit, value, and origin that it does not have. PAR. 9. Each and all of the false and misleading statements and representations made by the respondent in designating or describing its products, and the source of origin of the materials entering into their manufacture, in offering for sale and selling its said products, were and are calculated to, and had, and now have, a tendency and capacity to mislead a substantial portion of the cfmsuming public into the erroneous belief that all of the said representations are true, and into the purchase of respondent's said products on account of said beliefs.

PAn. 10. As a result thereof trade!' has been diverted from those competitors of respondent engaged in similar businesses herein referred to. As a consequence thereof substantial injury has been and is being done by respondent to competition in commerce between and among the various States of the United States and in the District of Columbia.

PAR. 11. The aforementioned methods, acts and practices of re· spondent are all to the prejudice of the public and respondent's competitors as liereinabove alleged. Said methods, acts, and prac· tices 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 Fe<leral Trade Commission, to define its powers and duties, and for other purposes," approved September 2G, 1D14· REPORT, FINDINGS AS TO THE FACTs, AND OnDEH Pursuant to the provisions of an Act of Congress approw•d September 2G, 1014, entitled "An Act to create a Federal Trade Commission, to define its powers and duties, and for othrr pnrposrs," the Federal Trade Commission, on July 26, 1!>37, issued and srrved its complaint in this proceeding upon respondent, Elite Glove Company, Inc., charging it with the use of unfair methods of competition in commerce in violation of the provisions of said act. Aftrr the issuance of said complaint and the filing of respondent's answer thcr('to, a stipulation as to the facts was entered into between W. T. ELITE GLOVE COMPANY, INC. 1309 1305 Findings Kelley, Chief Counsel for the Commission, and H. Andrew Schlusberg, counsel for respondent, which said stipulation was thereafter approved by the Commission. Thereafter, this proceeding regularly came on for final hearing before the Commission on the said complaint and answer thereto and the stipulation as to the facts (respontlellt ha,ving waived the filing of a brief); 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 Till<) FACTS PARAGRAPH 1. The respondent, Elite Glove Company, Inc., is a corporation having its principal office and place of business in the city of Gloversville, State of New York.

PAn. 2. The respondent has been, for more than one year last past, engaged in the business of manufactming, selling, awl distributing gloves in commerce between and among the various States of the United States and in the District of Columbia. PAn. 3. In the sale of said products respondent has transported or caused the same to be transported from its principal place of business in the State of New York to purchasers thereof located in States of the United States other than the State from which the shipment originated, and in the District of Columbia. There has been for more than one year last past, and there still is, a constant current of trade and commerce in said gloves so solrl and distributed between and among the various States of the United States and in the District of Columbia.

PAn. 4. For more than one year last past the respondent has been engaged in substantial competition with other individuals, partnerships, and corporations engaged in the manufacture, sale, and distribution of like and similar products in commerce between anrl among the various States of the Uniterl States and in the District of Columbia.

PAn. 5. In the course and conduct of its business the respondent, in soliciting the sale of, and in selling, its products, and for the Purpose of creating a demand upon the part of the consuming public for said products, has for more than one year last past caused its Products to be advertised through the media of price lists, newspapers, magazines, and other advertising media, printed, published, and circulated through the United States mails to its customers and Prosp('ctive customers located in the various States of the United States and in the District of Columbia.

1310 FEDERAL TRADE COl\IMISSION DECISIONS Findings 2:3 F. T. C. In the aforesaid ways and by the aforesaid means the respondent makes, and has made, to the general public false and misleading statements with reference to the commodities offered for sale by it. The price lists and other printed matter published and distributed by respondent, and hereinbefore referred fo, contain misleading descriptions and representations concerning respondent's products. Certain of the gloves manufactured, sold, and distributed by it are branded and represented to the purchasing public in the following manner:

1. Lady Daphne A British Doeskin MADE IN U. S. A.

2. Lady Daphne A British Suede MADE IN U. S. A.

PAR. 6. The foregoing statements and representations made by respondent in connection with the words "A British Doeskin" or "A British Suede," and the disparity of the size of the letters used therein as compared with the size of the letters used. in the phrase "MADE IN U. S. A.," sen-e as representations to customers nnd prospective customers that the leather used in the manufacture of respondenes products is processed .into the finished~ leather in Eng· land and imported into the United States. The use of the words and phrases set out immediately above leads customers and prospective customers into the belief that the leather if' processed into the finished leather in England and imported into the United States, where it is made into gloves. PAR. 7. The leather used in the manufacture of respumlent's products is not processed. into a finished leather in England and imported into the United States, but is tanned and. processed into a finished leather in this country and. therefrom made directly into the gloves made by respondent. The hides used in the making of respondent's products are imported from the Sudan of Egypt into this country, and after the hides are imported into this country they are tanned and processed into the finished. leather product. PAR. 8. For many years a substantial part of the consuming public hns had, and still has, and has so expressed, a marked preference for gloves, and particularly shoes, and other personal wearing effects made of leather which are manufacturl'd in England, or manufac· ttued in this country from leather processed in England and then imported. into the United States.

PAR. 9. There are among the competitors of respondent in colll· merce as herein set out manufacturers and distributors of like and ELITE GLOVE' COMPANY, INC. 1311 Order similar commodities who truthfully advertise and represent the nature, merit, and origin of their respective products, and who refrain from advertising or representing through their catalogs, brand marks, or other advertising media that the merchandise offered for sale by them has a merit, value, and origin that it does not have. PAn. 10. All the statements and representations made by respondoent in designating or describing its products and the source of origin .of the materials entering into their manufacture in offering for sale, and selling, said products were, and are, calculated to, and had, and now have, a tendency and capacity to mislead a substantial portion {)f the consuming public into the erroneous belief that all the said revresentations are true, and into the purchase of respondent's said products on account of said belief.

As a result of the representations made by respondent trade has been diverted from those competitors of respondent engaged in similar businesses hereinbefore referred to. As a consequence thereof l>Ubstantial injury has been and is being done by respondent to competition in commerce among and between the various States of the United States and in the District of Columbia. CONCLUSION The aforesaid acts and practices of the respondent, Elite Glove Company, 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 DESIST This proceeding having been heard by the Federal Trade Comll1ission upon the complaint of the Commission, the answer of respondent, and the stipulation as to the facts entered into between \V. T. Kelley, Chief Counsel of the Commission, and H. Andrew ~chlusberg, counsel for respondent, and the Commission having made lts findings as to the facts and its 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 i8 ordered, That the respondent, Elite Glove Company, Inc., a (;Orporation, its representatives, agents, and employes, in connection With the offering for sale, sale and distribution of gloves in coml~S12tm--a9----s~ Order 25F. T. C.

merce among and between the various States of the United States and in the District of Columbia, do forthwith cease and desist from representing, directly or indirectly, through the use of the word "British," or any other word or words of similar import and meaning, alone or in conjunction with other words, or through any other means or device, or in any manner, that its gloves, or the leather from which said gloves are made, were imported from or made from hides processed into finished leather in England or any other part of the British Empire.

It is further ordered, That the respondent shall, within 60 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.

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