John Grey the Fur Designer, Inc

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IN THE MATTER OF JOHN GREY THE FUR DESIGNER, INC.

COl\IPLA.INT, FINDINGS, AND ORDER IN REGARD TO THE ALLEGED VIOLATION OF SEC. 5 OF AN ACT OF CONGRESS APPROVED SEPT. 26, 1914 Doclcet 3658. Complaint, Dec. 9, 1938-Decision, Aug. 8, 1939 Where a corporation engaged in manufacture of patterns for fur coats and fur clothing, chiefly, and in sale and distribution thereof to purchasers in various States and in the District of Columbia, in substantial competition with others engaged in sale and distribution of such products in commerce and in said District, and including many who do not in any manner misrepresent the nature, origin, or design of their said patterns- Represented, through statements In advertisements, circulars, and booklets distributed among prospective purchasers, and on labels and through use of purported signatures of, and telegrams and cablegrams from, well-known French couturiers, such as "Designed by Molyneux, Rue Royale, Paris," "Typical of Worth," "Silhouette sponsored by Jenny," and others of similar tenor, that their said patterns were manufactured and made in Paris and designed by French de~igners of said city; Facts being said patterns were made at Its place of business in New York from designs produce(! by its employees there located, and were not made in Paris or designed by the various famous and outstanding Parisian and French designers whose names were used as above indicated and set forth, and pretended telegrams or cablegrams from whom were wholly fictitious, or by any other person or persons ln said city, and persons thus referred to had no connection with the designing or manufacturing of such patterns, which were not Paris fur fashions or patterns or designs of fashions from Paris;

With effect of mi;;le~ing and deceiving substantial portion of purchasing public into erroneous and mistaken belief that their said patterns were fashioned, designed, and made in Paris and by well-known French designers, for which higher-priced patterns, i,n the United States, and particularly those designed by persons named and indicated as aforesaid, and imported, there is a preference on the part of a substantial portion of the purchasing public, and Into purchase of said patterns because of such belief, mid of thereby diverting trade in commerce unfairly to it from its competitors who do not misrepresent the nature, origin, or design of their said products: Held, That such acts and practices, under the circumstances set forth, 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 in commerce.

Before Mr. Edna:i'd E. Reardon, trial examiner. 11/r. B. 0. Wilson for the Commission.

544 FEDERAL TRADE COMl\IISSION DECISION'S Complaint 2!) F. T. C. Complaint Pursuant to the provisions of the Federal Trade Commission Act and by virtue of the authority vested in it by said act, the Federal Trade Commission, having reason to believe that John Grey The Fur Designer, Inc., a corporation, hereinafter referred to as the respondent, has violated the provisions of said act, and it appearing to the Commission that a proceeding by it in respect thereof would be in the public interest, hereby issues its complaint stating its charges in that respect as follows:

PARAGRAPH 1. Respondent, John Grey The Fur Designer, Inc., is a corporation organized, existing and doing business under ancl by virtue o£ the laws o£ the State o£ New York, with its principal office and place o£ business at 350 Seventh Avenue, New York City in said State. It is now, and for more than 1 year last past has been, engaged in the manufacture of patterns, chiefly for fur coats and fut· clothing, and in the sale and distribution of such patterns in commerce between and among the various States of the United States and in the District of Columbia. Respondent causes such patterns, \Y]wn sold, to be transported from hs place of business in New York, N. Y., to the purchasers thereof, some located in the State of New York and others located in various other States of the United States and in the District of Columbia. There is now, and has been for more than 1 ypnr last past, a. con~tant current of trade in such pattems in commerce between and among the various States of the United States and in 1he District of Columbia. In the course and conduct of its business, respondent is now, and for more than 1 year last past has been, in substantial competition with other corporations and with persons1 firms, and partnerships in the sale and distributit.m of patterns in commerce between and among the various States of the United States and in the District of Columbia. Among these competitors are many who do not in any manner misrepresent the nature, origin, or design of their products.

PAR. 2. In connection with the sale and distribution of said patterns in said commerce, the respondent now represents, and for more than 1 year last past has represented, through statements used in ad,·ertisements, in circulars, and in booklets distributed among prospectin purchasers of said patterns, that the patterns oflered for sale and sold by it were manufactured and made in Paris, France, and designed by French designers in Paris, France. Such representations are also made on labels and through the use of purported signatures of, and telegrams and cablegrams from, well-known French couturiers. JOHN GREY THE FUR DESIGNER, INC. 545 543 Complaint Among others, and typical of the statements and representations so made and used by the respondent, the respondent has made anrl. used the following statements and representations: Designed uy l\Iolyneux, Rue Royale, Paris. Designed by Schiaparelll, 21 Place Vendome, Paris. l!'onnures uesigneu by Max, Paris.

301-l\lolyneux.

We call our designs fashions from Paris.

Paris Cables.

Paris 5683 January 6, W38.

Sending you Paris fur fashions inspired by Paquin, l\Iaggy, Houff, Uhauel, Jenny, Vionnet.

Jenny-Paris.

Use a Paris tie-up for your season's advertising. Use Paris fur fashions.

Charming turneu collar illustratei:l nrsntility of Vionnet inspirations. Typical of Worth.

Silhouette spousored by Jenny.

Dramatic short topper personifying gaiety of Chanel uesigns, sprightly rolled collar, trim elbow length, squared shoulder sleeves expression of new spring lllOtit.

The names 1\folyneux, Schiaparelli, Max, Paquin, Maggy, Rouff, Chanel, Jenny, Vionnet, and ·worth, used in said advertising matter are those of famous and well-known French designers located in Paris, France, with outstanding reputations, both in the trade and With the general public, as designers of patterns for fur garments or apparel. The use of such names and the statements in connection therewith as hereinabove set out misleads and deceives prospective purchasers of said patterns into the erroneous belie£ that the patterns referred to were made or manufactured in Paris, France, from designs produced by the designers named, or that the designs of said patterns were produced by the designers named. In truth and in fact, the patterns referred to in the advertising matter containing the names of said designers and the other statements hereinabove set out were made and manufactured in respondent's place of business in New York, N. Y., from designs produced by employees of the respondent at its said place of business in New York, N. Y., and were not and are not made or manufactured. in Paris, France, or designed by either l\Iolyneux, Schiaparelli, Max, Paquin, l\Iaggy, Rouff, Chane!, Jenny, Vionnet, or 'Vorth, or any other person or Persons in Paris, France, and no such persons had any connection with the designing or manufacturing of s~1ch patterns and. such patterns were not and are not Paris fur fashions or patterns of designs of fashions from Paris, France.

- Findings 29F. T. C. Purported telegrams or cablegrams from well-known French designers quoted in said advertisements were and are wholly fictitious and false, having no foundation, in fact, no such telegrams or cablegrams having been received by the respondent. PAR. 3. There is a preference on the part of a substantial portion of the purchasing public for patterns designed, created and originating in Paris, France, by French designers, more especially those named by the respondent in said advertising matter, and imported into this country, and such patterns command a higher price in the United States than do patterns for fur coats and fur clothes designed and made in the United States.

PAR. 4. The acts and practices of the respondent in making and using the false statements and representations hereinabove alleged have the capacity and tendency to, and do, mislead and deceive a substantial portion of the purchasing public and cause it erroneously and mistakenly to believe that said patterns are fashioned, designed, or made in Paris, France, by well-known French designers and, because of said erroneous and mistaken belief, to purchase respondent's said patterns. Thereby trade in said commerce is diverted unfairly to the respondent from its competitors who do not misrepresent the nature, origin, or design of their patterns, to the injury of said competitors and to the injury of the public. PAR. 5. The aforesaid acts and practices of the respondent as herein alleged are all to the prejudice 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. REPORT, FINDINGS AS TO THE FACTS, AND ORDER Pursuant to the provisions of the Federal Trade Commission Act, the Federal Trade Commission, on December 9, 1938, issued and on December 10, 1938, served its complaint in this proceeding upon respondent, John Grey The Fur Designer, Inc., a corporation, charging it with the use of unfair methods of competition in commerce and unfair and decepti,·e acts and practices in commerce in violation of the provisions of said act. After the issuance of said complaint and the filing of respondent's answer, the Commission, by order entered herein, granted respondent's motion for permission to withdraw said answer and to substitute therefor an answer admitting all the material allegations of fact set forth in said complaint and waiving all · intervening procedure and further hearing as to said facts, which JOHN GREY THE FUR DESIGNER, INC. 547 543 Findings substitute answer was duly filed in the office of the Commission. Thereafter, this proceeding regularly came on for final hearing before the Commission on the said complaint and substitute answer, and the Commission, having duly considered 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 nr.J its conclusion drawn therefrom:

FINDINGS AS TO THE FACTS PARAGRAPH 1. Respondent John Grey The Fur Designer, Inc., is a corporation organized, existing, and doing business under and by virtue of the laws of the State of New York, with its principal office and place of business at 350 Seventh A venue, New York City in said State. It is now, and for more than 1 year last past has been, engaged in the manufacture of patterns, chiefly for fur coats and fur clothing, and in the sale and distribution of such patterns in commerce between and among the nrious States of the United States and in the District of Columbia. Respondent causes such patterns, when sold, to be transported from its place of business in New York, N. Y., to the purchasers thereof, some located in the State of New York and others located in various other States of the United States and in the District of Columbia. There is now, and has been for more than 1 year last past, a constant current of trade in such patterns in commerce between and among the various States of the United States and in the District of Columbia. In the course and conduct of its business, respondent is now, and for more than 1 Year last past has been, in substantial competition with other corporations and with persons, firms, and partnerships in the sale and distribution of patterns in commerce between and among the various States of the United States and ip the District of Columbia. Among these competitors are many who do not in any manner misrepresent the nature, origin, or design of their products. PAR. 2. In connection with the sale and distribution o£ said patterns in said commerce, the respondent now represents, and £or lllore than 1 year last past has represented, through statements used in advertisements, in circulars, and in booklets distributed among Prospective purchasers of said patterns, that the patterns offered £or sale and sold by it were manufactured and made in Paris, France, and designed by French designers in Paris, France. Such repre· sentations are also made on labels and through the use of purported signatures of, and telegrams and cablegrams from, well-known French couturiers.

FEDERAL TRADE COJI.fl\IISSIO~ DECISIO~S 548 Findings 29F. T. C. Among others, and typical of the statements and representations so made and used by the respondent, the respondent has made and used the followi!'1g statements and representations: Designed by Molyneux, Rue Royale, Paris.

De~signed by Schiaparelli, 21 Place Vendome, Paris. Fourrures designed by 1\Iax, Paris.

301-l\Iolyneux.

We call our designs fashions from Paris.

Paris Cables.

Paris 5G83 January 6, 1938.

Sending you Purls fur fashions in;;pired by Paquin, l\Iaggy, Rouff, Chauel, Jenny, Vionnet.

Jenny-Paris.

Use a Paris tie-up for your sf'ason's advertising. Use Paris fur fashions.

Charming turned collar illustmtes versatility of Vionnet Inspirations. Typical of Worth.

Silhouette sponsored by Jenny.

Dramatic short topper personifying gaiety of Chane! designs, sprightly rolled collar, trim elbow length, squared shoulder sleevf'f! expresii3ion of llf'W spring motif.

The names :Molyneux, Schiaparelli, :Max, Paquin, Maggy, Rouff, Chanel, Jenny, Vionnet, and 'Vorth, used in said advertising matter are those of famous and well-known French designers located in Paris, France, with outstanding reputations, both in the trade and with the general public, as designers of patterns for fur garments or apparel. The use of such names and the statements in connection therewith as hereinabove set-out misleads and deceives prospective purchasers of said patterns into the erroneous belief that the patterns referred to were made or manufactured in Paris, France, from designs produced by the c1esigners named, or that the designs of said patterns were produced by the designers named. In truth and in fact, the patterns referred to in the advertising matter containing the names of said designers and the other statements hereinabove set-out were made and manufactured in respondent's place of business in New York, N. Y., from designs produced by employees of the respondent at its saill place of business in New York, N, Y., and were not and are not made or manufactured in Paris, France, or designed by either :Molyneux, Schiaparelli, Max, Paquin, Maggy, Rouff, Chane!, Jenny, Vionnet, or 'Vorth, or any other person or persons in Paris, France, and no such persons had any connection with the designing or manufacturing of such patterns ana such patterns were not and are not Paris fur fashions or patterns of designs of fashions from Paris, France. JOHN GREY THE FUR DESIGNER, INC. 549 {;43 Order Purported telegrams or cablegrams from well-known French designers quoted in said advertisements were and are wholly fictitious and false, having no foundation, in fact, no such telegrams or cablegrams having been received by the respondent. PAR. 3. There is a preference on the part of a substantial portion of the purchasing public for patterns designed, created, and originating in Paris, France, by French designers, more especially those named by the respondent in said advertising matter, and imported into this country, and such patterns command a higher price in the United States than do patterns for fnr coats and fur clothes designed and made in the United States.

PAR. 4. The acts and practices of the respondent in making and using the false statements and representations hereinabove found have the rapacity and tendency to, and do, mislead and deceive a substantial portion of the purchasing public into the erroneous and mistaken belief that said patterns are fashioned, designed, or made in Paris, France, by well-kno,vn French designers and into the purchase of said patterns because of said.erroneous and mistaken belief. As a direct result thereof, trade in commerce among and between the various States of the United States and in the District of Columbia has been diverted unfairly to the respondent from its said competitors who do not misrepresent the nature, origin, or design of their patterns.

CONCLUSION The aforesaid acts a,nd 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 in commerce and unfair and deceptive acts and practices in commerce within the intent and meaning of the Federal Trade Commission Act. ORDER TO CEASF. AND DESIST . This proceeding having been heard by the Federal Trade Commis- Sion upon the complaint of the Commission and the answer of respondent, in which answer respondent admits all the material allegations of fact set forth in said complaint, and states that it Wnives all intervening procedure and further hearing as to said facts, 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 orde;red, That the respondent, John Grey The Fur Designer, Inc., a corporation, its officers, rep~esentatiws, agents, and employees, 550 FEDERAL TRADE COMl\IISSION DECISIONS Order 2QF. T. C.

directly or through any corporate or other device, in connection with the offering for sale, sale and distribution of its patterns or designs in commerce, as commerce is defined in the Federal Trade Commission Act, do forthwith cease and desist from: 1. Representing, through the use of the word "Paris," either alone or in conjunction with any other word or words, or through the use of any other term or terms indicative of French or other foreign origin, or in any other manner, that clothing patterns or designs which have been made in the United States, have been made in Paris, France; or in any other foreign country. 2. Representing in any manner that clothing patterns or designs which have not been made or designed by Molyneux, Schiaparelli, Max, Paquin, Maggy, Rouff, Chanel, Jenny, Vionnet, or 'Vorth, have been made or designed by such person or persons, or representing that such patterns or designs have been made or designed by any person who is not in fact the actual maker or designer thereof. 3. Using the names of well-known designers of women's clothing1 or any other term or terms having the capacity or tendency to deceive the purchasing public as to the identity of the maker or designer of the patterns or designs sold by respondent. 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.

UNITED EDUCATORS, I~C., ET AL. 551 Syllabus