A. Sartorius & Company, Inc. trading as Plat-Nu Perl Laboratories

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IN THE 1t1ATTER OF A. SARTORIUS & COMPANY, INC. TRADING AS PLAT-NUl\1 PERL LABORATORIES COMPLAINT, FINDINGS, AND ORDER IN REGARD TO THE ALLEGED VIOLATION OF SEC. 5 OF AN ACT OF CONGRESS APPROVED SEPT. 26, 1914 Docket 3966. Complaint, Deo. 8, 1939-Decision Deo. 11, 1940 Where a corporation engaged in interstate sale and distribution of manicure products, including nail protector and nail polish remover, in substantial competition with others engaged in sale and distribution of manicure products In commerce as aforesaid, and including some who do not use methods and engage In acts and practices below desct·ibed- (a) Represented in advertisements through such statements as "Plat-Num Olive Oil Compound Nail Polish Remover for dry, brittle nails," that its said product was made from or contained olive oil and that by reason of presence of such oil lt would Improve or benefit the condition of dry, brittle nails, facts being quantity of olive oil therein contained was negligible, it could nbt be truthfully represented as an olive oil product, and olive oil contained therein was so small as to be incapable of relieving or improving to any appreciable extent condition of dry, brittle nails; and (b) Represented through such statements as "Plat-Num Nail Protector • • • encourages growth • • • strengthens nails," disseminated in advertisements among prospective purchasers that its said product stimulated tbe growth of the nails and strengthened the same, facts being it did not accoJllpli~h such results and was wholly incapable of effecting the same; With E'frect of misleading and deceiving consuming public into mistaken and erroneous belief that said representations were true and by reason thereof into purchasing substantial quantity of its said products, and with result, as consequence, that trade was unfairly diverted to It from its said competitors; to the substantial injury of 'competition In commerce: Held, That such acts and practices, under the circumstances set forth, were all to the prejudice of the public and competitors and constituted unfair methods of competition in commerce and unfair and deceptive acts and practices therein.

Mr. Gerard A. Rault for the Commission.

Mr. Henry L. Finkelstein, of New York City, for respondent. Complaint Pursuant to the provisions of the Federal Trade Commission Act, nnd by virtue of the authority vested in it by said act, the Federal Trade Commission, having reason to believe that A. Sartorius & Co., Inc., a corporation, trading as Plat-Num Perl Laboratories, hereinafter referred to as respondent, has violated the provisions of the said act, and it appearing to the Commission that a proceeding by it in respect PLAT-NUM PERL LABORATORIES 71- 70 Complaint thereof would be to the public interest, hereby issues its complaint, stating its charges in that respect as follows: PARAGRAPH 1. Respondent, A. Sartorius & Co., Inc., is a corporation, organized, existing, and doing business under and by virtue of the laws of the State of New York, with its office and principal place of business located at 80 Fifth Avenue, New York, N.Y. Respondent is now, and has been for some time last past, engaged in the sale and distribution in commerce, of manicure products, including a product intended for use as a nail polish remover and a product intended for use as a nail protector.

PAn. 2. Respondent, in the course and conduct of its businesc; aforesaid, has caused its said products, when sold, to be shipped from its place of business in the State of New York to purchasers thereof located in various other States of the United States and in the District of Columbia. Respondent maintains and at all times mentioned herein has maintained a course of trade in said products in commerce among and between the various States of the United States and in the District of Columbia.

PAR. 3. Respondent, in the course and conduct of it,; business as aforesaid and at all times herein referred to, has been, and is, in substantial competition with other corporations and with firms, partnerships, and individuals similarly engaged in the business of selling and distributing manicure products in commerce, among and between the various States of the United States and in the District of Columbia. Among such competitors are many who do not use the methods or engage in the acts and practices herein alleged. PAR. 4. In the course and conduct of its business respondent has made false and misleading representations with respect to its said nail polish remover, which representations are disseminated among prospective purchasers. Among and typical of such false and misleading representations is the descriptive statement "Plat-Num Olive Oil Compound Nail Polish Remover for dry, brittle nails." By the use of such representation, together with others of similar import not specifically set out herein, the respondent represents that its said product is made from or contains olive oil and that said product, by reason of the presence of such oil, will improve or benefit the condition of dry, brittle nails.

PAR. 5. The foregoing representations are grossly exaggerated, false, and misleading. In truth and in fact the quantity of olive oil contained in said product is negligible and said product cannot truthfully be represented as an olive oil product. The olive oil content in said product is so small as to be incapable of relieving or Complaint 32F.T.C.

improving to any appreciable extent the condition of dry, brittle nails.

PAR. 6. Respondent has also made false and misleading representations with respect to its product "Plat-Num Nail Protector," which representations are disseminated among prospective purchasers. Among and typical of such false and misleading representations is the descriptive statement:

Plat-Num Nail Protector • • • encourages gt·owth • • • strengthens nails. Through the use of such representations, together with other representations of similar import not specifically set out herein, respondent represents that its said product stimulates the growth of the nails and strengthens the nails.

PAR. 7. The foregoing representations are false and misleading. In truth and in fact the use of said product does not stimulate or encourage the growth of the nails nor does it serve to strengthen the nails. Said product is wholly incapable of effecting such results. PAR. 8. A further practice of the respondent, in connection with the sale and distribution of its said products as aforesaid, is the use of the legend "Manufacturing Chemists" in connection with its corporate name, which said legend appears on respondent's business stationery and on other printed and written matter distributed by respondent among prospective purchasers. Through the use of such legends the respondent represents that it is the manufacturer of its said commodities.

PAR. 9. The foregoing representation is false and misleading. In truth and in fact the respondent does not manufacture either of said products but purchases said products from other sources. PAR. 10. The use by the respondent of the aforesaid false and misleading representations has the capacity and tendency to; and does, mislead and deceive the consuming public into the mistaken and erroneous belief that said representations are true, and into the purchase of a substantial quantity of respondent's products on account of such beliefs.

As a result thereof, trade has been, and is being, unfairly diverted to respondent from its said competitors, and thereby substantial injury has been done, and is being done to competition in commerce among and between the various States of the United States. PAR. 11. The aforesaid acts and practices of the respondent, as herein alleged, are all to the prejudice and injury of the public and of respondent's competitors, and constitute unfair methods of com· petition in commerce and unfair and deceptive acts and practices in PLAT-NUM PERL LABORATORIES 73 70 Findings 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 the 8th of December 1939, issued and thereafter served its complaint in this proceeding upon said respondent A. Sartorius & Co., Inc., a corporation, trading as Plat-Num Perl Laboratories, charging it with the use of unfair methods of com· petition in commerce, and unfair and deceptive acts and practices in commerce in violation of the provisions of said act. On January 31, 1940, the respondent filed its answer in this proceeding. There· after a stipulation was entered into whereby it was stipulated and agreed that a statement of facts signed and executed by the respondent through its counsel, Henry L. Finkelstein, and "\V. T. Kelley, chief cmmsel for the Federal Trade Commission, subject to the ap· proval of the Commission, ;may be taken as the facts in this pro· ceeding and in lieu of testimony in support of the charges stated in the complaint or in opposition thereto, and that the said Commission may proceed upon such statement of facts to make its report, stating its findings as to the facts and its conclusion based thereon and enter its order disposing of the proceedings without the presentation of argument or the filing of briefs. Thereafter, this proceeding regularly came on for final hearing before the Commission on the said complaint, answer, and stipulation, said stipulation having been approved, accepted, and filed, and the Commission having duly con· sidered the same and being now fully advised in the premises, finds !hat this proceeding is in the interest of the public and makes this Its findings as to the facts and its conclusion drawn therefro.m. FINDINGS AS TO THE FACTS PARAGRAPH 1. Respondent, A. Sartorius & Co., Inc., is a corporation organized, existing, and doing business under and by virtue of the laws of the State of New York, with its office and principal place ?f business locat~d at 80 Fifth Avenue, New York, N.Y. Respondent Is. now and has been for some time last past, engaged in the sale and ?Jstribution in commerce of manicure products including a product Intended for use as a nail polish remover and a product intended for Use as a nail protector.

~ AR. 2. Respondent in. the course and conduct of its business aforesaid has caused its said products when sold to be .shipped from its Findings 32F. T.C.

place of business in the State of New York to purchasers thereof located in various other States of the United States and in the District of Columbia. Respondent maintains, and at all times mentioned herein has maintained, a course of trade in said products in commerce among and between the various States of the United States and in the District of Columbia.

PAR. 3. Respondent in the course and conduct of its business as aforesaid and at all times herein referred to has been and is in substantial competition with other corporations and with firms, partnerships, and individuals engaged in the business of selling and distributing .manicure products in commerce among and between the various States of the United States and in the District of Columbia. Among such competitors are some who do not use the methods or engage in the acts and practices herein described. PAR. 4. Respondent in the course and conduct of its business has made false and misleading representations with respect to its nail polish remover which representations have been disseminated among prospective purchasers. Among and typical of such false and misleading representations is the descriptive statement "Plat-Num Olive Oil Compound Nail Polish Remover for dry, brittle nails." By the use of such representation together with others of similar import not specifically set out herein, the respondent represents that its said product is .made from or contains olive oil and that said product by reason of the presence of such oil will improve or benefit the condition of dry, brittle nails.

PAR. 5. The foregoing representations are false and misleading. In truth and in fact the quantity of olive oil contained in said product is negligible and said product cannot truthfully be represented as an olive-oil product. The olive oil content in said product is so small as to be incapable of relieving or improving to any appreciable extent the condition of dry, brittle nails.

PAR. 6. Respondent has also made false and misleading representations with respect to its product "Plat-Num Nail Protector" which representations are disseminated among prospective purchasers. Among and typical of such false and misleading representations is the descriptive statement:

Plat-Num Nail Protector • • • encourages growth • • • strengthens nails.

Through the use of such representations, together with other representations of similar import not specifically set out herein, respondent represents that its said product stimulates the· growth of the nails and strengthens the nails.

PLAT-N~ PERL LABORATORIES 75 70 Order PAR. 7. The foregoing representations are false and misleading. In truth and in fact, the use o£ said product does not stimulate or encourage the growth o£ the nails nor does it serve to strengthen the nails. Said product is wholly incapable of effecting such results. PAR. 8. The use by the respondent of the aforesaid false and misleading representations has the capacity and tendency to and does mislead and deceive the consuming public into the mistaken and erroneous belief that said representations are true and into the purchase of a substantial quantity of respondent's products because of such belief. As a result thereof, trade has been and is being unfairly diverted to the respondent from its said competitors and thereby substantial injury has been done and is being done to competition in commerce among and between the various States of the United States. CONCLUSION The aforesaid acts and practices of the respondent as herein found 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 Ineaning 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, the answer of the respondent and a stipulation as to the facts entered into between the respondent herein and ,V, T. Kelley, chief counsel for the Commission, which provides, among other things, that without further evidence or other Intervening procedure the Commission may issue and serve upon the respondent herein findings as to the facts and conclusion based thereor and an order disposing o£ the proceeding, and the Commission having lnade 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, A. Sartorius & Co., Inc., a cor· Poration, trading as Plat-Num Perl Laboratories, or trading under any other name, its officers, agents, representatives, and employees, directly ?t through any corporate or other device, in connection with the offerlllg for sale, sale, or distribution o£ its cosmetic preparations designated "Plat-Num Olive Oil Compound Nail Polish Remover" and "Plat-Num Nail Protector," or any cosmetic preparations of substantially similar composition or possessing substantially similar Properties, whether sold under the same names or under any other names, do forthwith cease and desist from directly or indirectly: Order 32F. T. C.

1. Disseminating or causing to be disseminated any advertisement (a) by means of the United States mails or (b) by any means in commerce, as "commerce" is defined in the Federal Trade Commission Act, which advertisement represents, directly or through inference, that said preparation "Plat-Nurn Olive Oil Compound Nail Polish Remover" will relieve or improve the condition of dry, brittle nails; that said preparation "Plat-Num Nail Protector" stimulates the growth of the nails or strengthens the nails. 2. Disseminating or causing to be disseminated any advertisement by any means for the purpose of inducing or which is likely to induce, directly or indirectly, the purchase in commerce, as "commerce" is defined in the Federal Trade Commission Act, of said preparations, which advertisement contains any of the representations prohibited in paragraph 1 hereof.

It is further ordered, That the respondent, A. Sartorius & Co., Inc., a corporation, trading as Plat-Num Perl Laboratories or trading under any other name, its officers, agents, representatives, and edlployees, directly or through any corporate or other device, in connection with the offering for sale, sale, and distribution in commerce, as "commerce" is defined in the Federal Trade Commission Act, of its cosmetic preparation designated "Plat-N urn Olive Oil Compound Nail Polish Remover," or any cosmetic preparation of substantially similar composition or possessing substantially similar properties, do forthwith cease and desist from:

Using the words "Olive Oil," or any other word or words of similar import or meaning, to designate, describe or refer to respondent's cosmetic preparation now designated "Plat-Num Olive Oil Compound Nail Polish Remover," or otherwise representing t_hat said preparation contains any substantial amount of olive oil. It is furth.er ordered, That the respondent shall, within 60 clays 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.

ELECTROLYSIS ASSOCIAn:s, I'.Nc., E1' AL. 77 Syllabus