Excelsi R Laboratory, Inc

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IN THE MATTER OF EXCELSIOR LABORATORY, INC.

COMPLAINT, FINDINGS, AND ORDER IN REGARD TO THE ALLEGED VIOLAT!OlO OF SEC. 5 OF AN ACT OF CONGRESS APPROVED SEPT. 26, 1914 Docket 8648. Complaint, Nov. 8, 1938-Decision, Feb. 6, 1939 Where a corporation engoged In prepnration, sale, and distribution of Its socalled D. Gosewlsch's Garlic Tablets, D. Gosewisch's Garlic Tablets wltg Vitamin E Added, and D. Gosewisch's Garlic Tablets with Vitamin &- Added, to members of the purchasing public in various States and In tbe District of Columbia, in substantial competition with others engaged 1~ sale and distribution of medicinal and other preparations designed an· Intended for and used in treatment of same ailments and conditions tor which it recommended use of its said products, and Including many wbo dO not in any manner misrepresent their respective preparations or therapeutic properties thereof and who do not make any other false statements Ill connection with their sale and distribution- (a) Represented In false advertisements which is disseminated and caused to be disseminated through the mnils and in commerce and otherwise, dlrectl~ and by implication, that vitamin E is the "Vitality VItamin," and that, 0 all the elements discovered by science, none is l:lO vital as said vitamin '&. and that such vitamin had been added to its said "Garlic Tablets," and tbllt use of its preparations could be relied upon to help maintain and impro"e muscle function, abdominal strength, and vital resistance ; (b) Represented, as aforesaid, that use thereof stimulated the appetite and growth and l:ltrengthened intestines and toned up nerve system and :tort!· fled the system against the onslaught of old-age ailments and normaw:ed • glandular action:

(c) Represented, as aforesaid, that use thereof purified the blood stream an~ supplied body bullding elements for mothers and growing children an< minerals needed by the body, and gave results impossible to be had :rroJll garlic in any other form; and (d) Represented, as aforesaid, that use of said preparations constituted elfecti'l'e remedies for insomnia, dizzy spells, rising blood pressure, bad memory, aod general debility, and that they were antiseptics and guaranteed; , Facts being vitamin E cannot be properly designated as the "Vitality Vitan1IO and is not the most vital of all the elements discovered by science, the many ailments and symptoms for which it recommended its said preparations are caused by various p!1yslcal disorders unrelated to deficiencies In the various ingredients of which It claims its preparations to be composed, and use thereof cannot be relied upon to help maintain and improve muscle tunc· tions, abdominal strength, and vital resistance, or to accomplish various other results above set forth, preparations In question are not antiseptics• many others give equally great beneficial results, it does not guarantee it~ preparations as to effectiveness in use, but its guarantee is limited to refund of purchase price, and its said representations were grossly exaggerated and misleading and constituted false adverti~ements, use of which Induces or Is likely to Induce, directly or indirectly, purchase of its said prepara· tions: and EXCELSIOR LABORATORY, INC. 323 322 Complaint (e) Represented to pro~pectlve purchasers In various States an:l in the Dis· trict of Columbia, that it would give to such purchasers a specified amount of said preparations free of charge, facts being it does not thus give any or its said products to purchasers but price of such purported free goods W is included in price of those purchased; lth Pffect of misleading and deceiving substantial portion of purchasing public into erroneous and mistaken belief that such false statements, representations, and advertisements were true, and that its preparations possessed Properties claimed and represented, and would accomplish results indicated, and of causing substantial portion of said public, because of such erroneous and mistaken beliefs, to purchase substantial quantities of Its said products, and of thereby di1·erting unfairly trade to it from its competitors in com· nwrce as aforesaid, who truthfully advertise the effectiveness in use of their respective preparations; to the injury of competition in commerce: lleld, That such acts and practices were all to the prejudice and injury of the Public and competitors and constituted unfair methods of competition and Unfair and deceptive acts and practices.

Mr. William L. Pencke for the Commission.

Complaint Pursuant to the provisions of the Federal Trade Commission Act, and by virtue of the authority vested in it by said act, the Feueral 'I'trade Commission, having reason to believe that Excelsior Laborat~ry, Inc., a corporation, hereinafter referred to as respondent, has " 1?lated the provisions of the said act, and it appearing to the Comllllssion that a proceeding by it in respect thereof would be in the t>ublic interest, hereby issues its complaint, stating its charges in that respect as follmys:

• PARAGRAPH 1. Excelsior Laboratory, Inc., is a corporation organlZed, existing and doing business under and by virtue of the laws o£ ~he. State of New York, with its home office and principal place of Usmess located at 205 East 42nd Street, New York, N.Y. Respondent is now and has been for some years last past engaged in the business of preparing, distributing, and selling in commerce as herein set 0Ut certain preparations designated D. Gosewisch's Garlic Tablets, b. Gosewisch's Garlic Tablets with Vitamin E Added, and D. Gosewisch's Garlic Tablets with Vitamin B-G Added. PAR. 2. Said respondent while engaged in business as aforesaid Causes said products when sold to be transported from its principal })lace of business in the State of New York to purchasers thereof located in States of the United States other than the State of New !ork and in the District of Columbia. At all times since the organ- IZation of respondent's corporation it has maintained a course of trade in said products sold and distributed by it in commerce between 324 FEDERAL 'trade COMMISSION DECISIONS Complaint 28 F. T. c. and among the various States of the United States and in the District of Columbia.

PAR. 3. In the. course and conduct of its business respondent is now and has been at all times herein mentioned in substantial competition with other corporations and with firms and individuals likewise en· gaged in the business of preparing, distributing, and selling in com· merce between and among the various States of the United Stl\tes and in the District of Columbia products prepared, distributed, and sold for the same purpose and use for which respondent's products are prepared, distributed, and sold.

PAR. 4. In the course and conduct of its business as aforesaid, respondent has disseminated and caused to be disseminated false advertisements- 1. By the United States mails and in commerce by other :means ,i for the purpose of inducing, and which are likely to induce, directly or indirectly, the purchase of the aforesaid preparations; and 2. By other means for the purpose of inducing and which are Iike!Y to induce, directly or indirectly, the purchase in commerce of said preparations.

Among and typical of representations thus made by the respondent are the following:

Is your blood pressure like a jumping jack?-thousands report 50 to 75 points drop In blood pressure, nerves steadier, new strength and energy taking p. Gosewiscl~'s Garlic Tablets-the only pleasant, effective way to take garlic tor High Blood Pressure, Dizziness, Nerves, Sleeplessness. 1 D. Gosewisch's Garlic Tablets combat deficiency aliments by supplying vita minerals and ridding system fJf toxins.

Garllc tmilds and fortifies the system against the onslaught of old age all· ments by supplying the body with rich, vital minerals and purifying the blood stream of toxins. • When exhaustion of essential minerals • • • gastric disorders • • intestinal putrefaction • • • and other distressing symptoms bring abollt premature aging, garlic wfll have a definite happy effect. Iodine to normalize glandular action.

First they purify the blood stream by counteracting toxins. Third they actually supply those minerals necessary for proper bodily functloll• One Box Free With Each Dozen at $8.00.

It is the most powerful of natural antiseptics to neutralize poisons In tbe system.

Vltallty VItamin- Of all the elements discovered by science none is so vital as Vitamin E no« added to D. Gosewlsch's Garlic Tablets-helps to maintain and improve must!~ function, abdominal strength and vital resistance. Also Important where VIta· min E deficiency results In abnormal functional weakness and deb1llty. Vitamin B-G now contained In D. Gosewlsch's Garlic Tablets Is another garlic vitamin combination: stimulates appetite and growth, tones up the system, sup" EXCELSIOR LABORATORY, INC. 325' Complaint Diles body building elements for expectant mothers, convalescents and growing Children.

Tones up the nerve system.

Strengthens the intestines.

Standard plus "nerve Vitamin n·•.

All of said statements together with many other similar statements 11PJ:>hearing in respondent's advertising purport to be descriptive of ~sp~ndent's products, D. Gosewisch's Garlic Tablets, D. Gosewisch's V'~rhc Tablets, Vitamin E Added, and D. Gosewisch's Garlic Tablets, ltarnin B-G Added. In all of respondent's advertising matter herein set out and through other statements of like import and ~~ect the respondent represents that vitamin E is the "Vitality . Vitamin" and that of all the elements discovered by science none 18 so vital as vitamin E. Respondent further represents that its llroducts can be relied upon to help maintain and improve muscle function; to help maintain and improve abdominal strength; to 1!elp maintain a.nd jmprove vital resistance; to stimulate the appetite and growth; to strengthen the intestines; to tone up the nerve system; to fortify the system against the onslaught of old-age ailments; to. normalize glandular action; to purify the blood stream; to supply body-building elements for expectant mothers and growing children; to supply minerals needed by the body; to give results impossible to obtain from garlic in any other form; that its products are effective l'ernedies for insomnia, dizzy spells, r1smg blood pressure, bad ! lnernory and general debility, and that its products are antiseptics, and are guaranteed.

III• to Pthe.AR. 5.therapeuticThe representationsvalue of madeits productsby the respondentwhen usedwitharereferencegrossly 1 e:<caggerated, false, and misleading. In truth and in fact vitamin E II cannot be properly designated as the "Vitality Vitamin" and is not I· the most vital of all the elements discovered by science. Respond- ' ent's products cannot be relied upon to help maintain and improve lnuscle functions, abdominal strength, and vitnl resistance. Neither! l they stimulate growth or strengthen the intestines. Said prod- '"ill ~ llcts are not effective as nerve remedies and cannot be relied upon to tone up the nerve system. Said products will in no way ward off the onslaught of old age nor fortify the system against the loss of '-'itality. Said products will not remove impurities from the blood stream, neither will they correct abnormal glandular action. Said Products are not effective treatments nor adequate remedies for insomnia, dizzy spells, rising blood pressure, bad memory, or general debility. Said products are not antiseptics. :Many other preparations which are sold give beneficial results as great as the results Complaint 28F.T. C.

obtained from the use of respondent's products. Respondent does not guarantee its products as to their effectiveness, but the guarantee is limited to the refund of the purchase price. The many ailments and symptoms hereinabove set out for the treatment of which the respondent recommends its products are caused by various physical disorders unrelated to deficiencies of the various ingredients of which respondent claims its products are composed.

l">AR. 6. The use of the aforesaid false advertisements disseminated in the manner above described induces or is likely to induce, directly or indirectly, the purchase of drugs, to wit: Respondent's preparations.

PAR. 7. The respondent, for the purpose of inducing the purchase of its products represents that it will give to purchasers of its prod· ucts a specified amount of its products free of charge. Such repre· sentation is false and misleading, for in truth and in fact the respondent does not give any of its products to purchasers but the price of the purported free goods is, included in the price of the goods purchased.

PAR. 8. There are among respondent's competitors many who pre· pare, distribute, and sell preparations which are prepared, distributed, and sold for the same purpose and use for which re· spondent's products are prepared, distributed, and sold and who do llot misrepresent the quality or therapeutic value of their respective products, or represent that any of their products are given free. PAR. 9. Each and all of the false and misleading statements and -representations made by the respondent in designating and describ· ing its products and the therapeutic value thereof as hereinabove set out, were and are calculated to, and have had and now have a tendency and capacity to mislead and deceive a substantial portion of the purchasing public into the erroneous belief that all of the said representations are true. Further, as a direct consequence of the mistaken and erroneous beliefs induced by the acts, advertise· ments, and misrepresentations of respondent as hereinabove detailed, a number of the purchasing public have purchased a substantial volume of respondent's products with the result that trade has been diverted unfairly to the respondent from individuals, firms, and corporations likewise engaged in the business of manufacturing, distributing, and selling products prepared, intended, and sold for the same and similar purposes for which respondent prepares and sells its products. As a result thereof substantial injury has been and is now being done by respondent to competition in commerce EXCELSIOR LABORATORY, INC. 327 322 Findings among and between the various States of the United States and in the District of Columbia.

PAR. 10. The aforesaid acts and practices of respondent are· all to the prejudice of the public and of respondent's competitors and constitute unfair methods of competition in commerce and unfair and deceptive acts and practices in commerce within the intent and meaning of the Federal Trade Commission Act. · REronT, FINDI~Gs AS TO Tile F Aurs, AND Onder Pursuant to the provisions of the Federal Trade Commission Act, the Federal Trade Commission, on the 8th day of November 1938, is~ sued, and subsequently served its complaint in this proceeding upon respondent, Excelsior Laboratory, Inc., charging it with the use of unfair methods of competition and unfair and deceptive acts and practices in commerce in violation of the provisions of said act. On the 30th day of November 1938, the respondent filed its answer, in which nnswer it admitted all the material allegations of fact set forth in said complaint and waived all intervening procedure and further hearing as to said facts. Thereafter, the proceeding rE>gularly came on for final hearing before the Commission on the said complaint and the answer there>to, and the Commission, having duly considHed the matter, 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 Tile FACTS PARAGRAPH 1. Respondent, Excelsior Laboratory, Inc., is a corpora~ tion organize>d, existing, and doing business under and by virtue of the laws of the State of New York, and formerly having had its office and principal place of business at 205 East Forty-second Street, in the city of New York, State of New York, and being now located at 70 Spring Hill A venue, St. George, Staten Island, N. Y. PAR. 2. The respondent is now, and has been for some years last past, engaged in the business of preparing, selling, and distributing certain preparations designated us D. Gosewisch's Garlic Tablets, D. Gose~ wisch's Garlic Tablets with Vitamin E Added, and D. Gosewisch's Garlic Tablets with Vitamin D-G Added. Respondent sells said preparations to members of the purchasing public situated in various States of the United States and in the District of Columbia, and causes the said preparations, wlwn sold by it, to be transported from its aforesaid place of business in the State of New York to the pur- . chasers thereof at their respective points of location in various States 328 FEDERAL TRADE COl\I:aiiSSION DECISIONS Findings 28F.T.C.

of the United States other than the State of New York, and in the District of Columbia. Respondent maintains, and at all times men~ tioned herein has maintained, a course of trade in commerce in said preparations among and between the Yarious States of the United States and in the District of Columbia.

PAR. 3. Uespondent is engaged in substantial competition in com~ merce among:: and between the various States of the United States and in the District of Columbia with other corporations and with firms, partnerships, and individuals selling and distributing medicinal and other preparations designed and intended for, and used in, the treatment of the ailments and conditions of the human body for which respondent recommends the use of its said preparations. Among such competitors in said commerce are many who do not, in :any manner, misrepresent their respective preparations or the thera~ peutic properties thereof, and who do not make any other false state~ ments in connection with the sale and distribution of their respective preparations.

PAR. 4. In the course and conduct. of its business, as aforesaid, re~ spondent has disseminated and caused to be dis:;;eminated false advertisements- 1. lly the United States mails and in commerce among and between the various States of the United States and in the District of Columbia by other means for the purpose of inducing, and which are likely to induce, directly or indirectly, the purchase of the aforesaid prepara· tions; and 2. lly other means for the purpose of inducing, and which are likely to induce, directly or indirectly, the purchase in commerce among and between the Yarious States of the United States and in the District of Columbia of said preparations.

Among and typical of the representations contained in said false advertisements so used and disseminated as aforesaid are the following:

Is your blood pressure like a jumping jack?-thousands report 50 to 75 points drop in blood pres>:nre, nerves steadier, new strength and energy taking D. Gosewisch's Garlic Tablets-the only pleasant, effectil'e way to take garlic for High lllood Pressure, Dizziness, Nenes, Sleeplet-:sneRf!. n. 11o~<ewisch">< Gallic Tablets combat deficiency ailments by F:llJlJllying vital minerals and ridding sy~tem of toxins.

Garlic builds and fortlftps the system against the onsl:JUght of old age nilmPnts by supy•lying the body with rich, vital minerals and purifying the hlooll stream of toxins.

"lVhen I'Xhau~tlon of essetJtlal minerals • • • gastric disorders • • • lnteRtinal putrrfactlon • • • and other distressing symptom~ bring about premature aging, garlic will ha¥e a definite happy £'1Iect. Iodine to noi·malize glandular action.

EXCELSIOR LABORATORY, INC, 329 322 Findings First they purify the blood stream by counteracting toxins. Third they actually supply those minerals necessary for proper bodily function.

One Box Free With Each Dozen at $8.00.

It is the most powerful of natural antiseptics to n~>utrallze poisons in the system.

Vitality Vitamin. Of all the elements discovE>red by science none is so vital as Vitamin E now added to D. Gosewisch's Garlic Tablets-helps to maintain and improve muscle function, abdominal strength and vital resistance. Also important where Vitamin E deficiency results in abnormal functional weakness and debility.

Vitamin B-G now contained in D. Gosewlsch's Garlic Tablets ls another garlic vitamin combination; stimulates apr:>etite and growth, tones up the system, supplies body building elements for expectant mothers, convalescents and growing children.

Tones up the nerve system.

Strengthens the intestines.

Standard plus "nerve Vitamin ll".

PAR. 5. Through the use of the statements and representations hereinabove set forth and others similar thereto not herein set out, all of which purport to be descriptive of respondent's preparations and their effectiveness in the treatment of ailments and conditions of the human body and the cause of such ailments and conditions, respondent has represented, directly and by implication, among other things, that vitamin E is the "Vitality Vitamin" and that of all the elements discovered by science, none is so vital as vitamin E; that the use of such preparations can be relied upon to help maintain and improve muscle function, abdominal strength, and vital resistance; that the use of such preparations stimulates the appetite and growth, strengthens the intestines, tones up the nerve system, fortifies the system against the onslaught of old-age ailments, and normalizes glandular action; that the use of such preparations purifies the blood stream, supplies body building elements for expectant mothers and growing children, and supplies minerals needed by the body; that the use of such pre.parations gives results impossible to obtain from garlic in any other form; that the use of such preparations constitutes effective remedies for insomnia, dizzy spells, rising blood pressure, bad memory, and general debility; and that such pf(>parations are antiseptics and are guaranteed. PAR. 6. The aforesaid representations by the respondent relative to the therapeutic value of said preparations, used and disseminated by the respondent in the manner above described, are grossly exaggerated, misleading, and constitute false advertisements. In truth and in fact vitamin E cannot be properly designated ns the "Vitality Vitamin" and is not the most vital of all the elements discovered by 330 FEDERAL TRADE COMJ\IISSIO~ DECISIOXS Findings 28 F.T. G. science. The use of respondent's said preparations cannot be relied upon to help maintain and improve muscle functions, abdominal strength, and vital resistance. The use of such preparations will not stimulate growth or strengthen the intestines. The use of such preparations is not effective as nerve remeuies and cannot be relied upon to tone up the nerve system. The use of such preparations will in no way ward off the onslaught of old age or fortify the system against the loss of vitality. The use of such preparations will not remove impurities from the blood stream, nor will it correct abnormal glandular function. Said preparations are not effective treatments or adequate remedies for insomnia, dizzy spells, rising blood pressure, bad memory, or general debility. Said preparations are not antiseptics. l\fany other preparations which are sold give beneficial results as great as the results obtained from the use of respondent's said preparations. Respondent does not guarantee its preparations as to their effectiveness in use, but the guarantee is limited to the refund of the purchase price. The many ailments and symptoms hereinabove set out, for the treatment of which the respondent recommends its said preparations, are cau~ed by various physical disorders unrelated to deficiencies in the various ingredients of which respondent claims its preparations are composed.

PAR. 7. The use of the aforesaid false advertisements, disseminated in the manner above described, induces, or is likely to induce, directly or indirectly, the purchase of drugs, to wit: Respondent's preparations.

PAR. 8. The respondent, for the purpose of inducing the purchase of its said preparations, represents to prospective purchasers of such preparations, situated in various States of the United States and in the District of Columbia, that it will give to such purchasers a specified amount of such preparations free of charge. Such representation is false and misleading, for, in truth and in fact, the respondent does not give any of its preparations to purchasers free of charge, but the price of the purported free goods is included in the price of the goods purchased.

PAR. 9. The use by the respondent of the foregoing false, deceptive, and misleading !>tatements, representations, and advertisements, disseminated as aforesaid, with respect to :;aid preparations, has had, and now has, the capacity and tendency to, and does. mislead and deceive a ~ubstantial portion of the purchasing public into the erroneous and mistaken belief that such false statements, representations, and advertisements are true, and that respondent's said preparations possess the properties claimed and represented, and will accom- EXCELSIOR LABORATORY, INC. 331 322 Order plish the results indicated, and causes a substantial portion o£ the purchasing public, because o£ said erroneous and mistaken belie£, to purchase substantial quantities of respondent's said preparations. As a result, trade has been diverted mlfairly to the :r:respondent from its competitors in said commerce who truthfully advertise the effectiveness in use o£ their respective preparations. In consequence thereof, injury has been, and is now being, done by respondent to competition in commerce among and between the various States o£ the United States and in the District of Columbia. CONCLUSION The aforesaid acts and practices of respondent, as herein found, are all to the prejudice and injury of the public and of respondent's competitors and constitute unfair methods of competition and unfair and deceptive acts and practices in commerce within the intent and meaning of the Federal Trade Commission Act. ORDER TO CEASE AND DESIST This proceeding having been heard by the Federal Trade Commission upon the complaint of the Commission and the answer of respondent, in which answer respondent admits all the material allegations of the complaint to be true, and states that it waives hearing on the charges set forth in said complaint and that, without further evidence or other intervening procedure, the case might proceed:i to final hearing upon the record, and the Commission having made its findings as to the facts and conclusion that said respondent has violated the provisions of the Federal Trade Commission Act. It is ordered, That the respondent, Excelsior Laboratory, Inc., its officers, representatives, agents and employees, directly or through any corporate or other device, do forthwith cease and desist from: Disseminating, or causing to be disseminated, any advertisement by means of the United States mails or in commerce, as commerce is defined in the Federal Trade Commission Act, by any means, for the purpose of inducing, or which is likely to induce, directly or indirectly,· the purchase of a medicinal preparation in tablet form designated by the names o·f D. Gosewisch's garlic tablets, D. Gosewisch's garlic tablets with vitamin E added, and D. Gosewisch's garlic tablets with vitamin D-G added, or any other medicine composed of substantially similar ingredients, whether sold under those names or under any other nanw, or disseminating or causing to be disseminated any ach·ertisement by any means for the purpose of inducing, or which is likely to induce, the purchase in commerce, as commerce is defined in the 2003l(Jm-4o-vol. 28-24 Order 28F.T.O.

Federal Trade Commission Act, of said tablets, which advertisements represent, directly or through implication, that such garlic tablets constitute a remedy or cure for high blood pressure, loss o£ vitality, impurities of the bloodstream, abnormal glandular functions, or will help maintain and improve muscle functions or give abdominal strength or vital resistance, or will stimulate growth or strengthen the intestines, or be an effective nerve remedy or tone up the nerve syc:tem or ward off the onslaught of old age, or that it is a remedy for insomnia, dizzy spells, rising blood pressure, bad memory, or general debility, or that such garlic tablets constitute a competent, effective treatment for any such diseases or ailments other than as an aid in soothing the nervous system, or that they are antiseptic, or that they are guaranteed unless such guarantee is limited to the refund of the purchase price; that "Vitamin E is the Vitality Vitamin" or is the most vital of all elements discovered by science. It is further m·dered, That the respondent shall, within 60 days after service upon it o:f 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.

MORRIS WHITE MFG. CO., INC., ET AL. 333 Complaint