Hechtman, Daniel

Text (OCR of the scan at left; may contain errors)

IN Tile MATTER OF DANIEL HECHT~IAN AND STEVE MOORE, TRADING AS II & II HAT COMPANY CO~fPLAINT, FI:\'Dll\CS, A:SD Order IN REGARD TO THE ALLEGED VIOLATION OF Tile FEDERAL TRADE COl\L'IliSSIO:S ACT AND THE WOOL PRODUCTS LABELL\'G ACT OF 1030 . Dueket 46JJ. Complaint, ,Tan.1.5, 1912 '-Decision, June 23, 19~i2 Where two indi>1tluals, engaged in the manufacture of women's hats from felt and other materials includillg oltl, worn or pre,·iously used felt hut bodies pur·chased by them, which, after being cleaned, slmped and fitted with new trimming, had the appearance of new bats made from new felt; and In the intet·state sale and distribution of said prollucts- (a) Sold tlleir said hats with no labeling, markings, or designation to Indicate that they were in fact made from old, used llnt bodies, to jobbers, wholesalers, and retailers by whom they were rpsold to the purchasing publlc Without disclosut·e of aforesaid fact;

With result that a substantial pot·tlon of said public was misled into believing that produds in question were made entirely from uew materials, and in consequence, Into purchase of substantial quantities tl!ereof; and with further result of thereby placing in the hands of dealers a means of deceiving or misleading membet·s of the public Into the mistaken belief that they were, contrary to the fact, purchasing new hats; and Where saill indh·iduals, engaged as aforesaid in manufacture and sale of hats, including many which W('re wool products within the meaning of the Wool Prouucts Labeling Act in that they were composed In part of· wool, re- Proeessed wool, or reused wool, and other fibers- ( b) Suhl said products misbranded In violation of net In question In that they did not have on or affixE>Cl thereto a stamp, tog, label, or other means of identification showiug the percentages of the total fiber weight required by the statute with respect to wool, rE>processed wool, reused wool, nonwool fihers, and aggregates thereof, addition of. nonfibrous loading, and proper identlfica tion of the manufactut·er or seller, under act In question: lielrl, That such acts ·and practices, under the circumstances set forth, were all to the prejudice and Injury of the puhlic, and constituted unfair and dece>ptive acts oud practices l:p commerce within the Intent and meaning of the Fetleral Trade Commission Act and the Wool Products Labeling Act of 1939.

lllr. L. E. Creel, Jr., for the Commission. Mr. Irvi-ng Block, of Chicago, Ill., for respondents. AlltENDED Co:MrLAINT Pursuant to the provi::ions of the Federal Trade Commission Act, and by virtue of the authority vested in it by said act, the Federal -------Trade'Amended.Commission, having reason to believe that Daniel Hechtman 1484 FEDERAL TRADE COJ\IMISSIO~ DECISIONS Complaint 34F.T. C.

and Steve 1\Ioore, individually, and trading as II & II Hat Co., have violated the provisions of said act and the provisions of the Wool Products Labeling Act of 1939, and the rules and regulations promulgated thereunder, and it appearing to the Commission that a proceeding by it in respect thereof would be in the public interest, hereby issues its amended complaint, stating its charges in that respect as follows:

PARAGRAPH 1. Respondents, Daniel Hechtman and Steve Moore, are individuals, trading as H & H Hat Co., and have their principal office and place of business at 1351 Milwaukee A venue, Chicago, Ill. PAR. 2. Respondents are now, and for several years last past have been, engaged in the business of manufacturing women's hats from felt and other materials. Some of said hats have been man11factured from felt obtained from old, worn, or previously used hats and others are made from felt not previously used as felt. Respondents sell said hats to retailers, jobbers, and wholesale dealers located in the various States of the United States and the District of Columbia. Respondents cause said hats, when sold,· to be transported from their place of business in the State of Illinois to the aforesaid purchasers located in various States of the United States other than the State of Illinois. · Respondents maintain, and at all times mentioned herein have maintained, a course of trade in said hats in commerce among and between the various States of the United States and in the District of Columbia.

PAR. 3. In the course and conduct of their business, prior to July 15, 1941, respondents bought old, worn, or previously used felt hats. Thp old, worn, or previously used felt hat bodies were cleaned and shaped and fitted with new trimmings and sold by respondents to dealers who in turn sold said hats to the purchasing public. PAn. 4. The aforesaid hats manufactured from old, worn, or previously used hat bodies as hereinabove described had the appearance of new liats manufactured from new felts. 'Vhen articles manufactured from old, worn, or previously u~ed materials and having the appearance of being manufactured from new materials are offered to the purchasing public and are not clearly and conspicuously labeled as being manufactured from old, worn, or previously used materials, such articles are readily accepted by members of the purchasing public as being manufactured entirely from new materials.

Said hats were sold to retailers and other dealers without any label, marking, or designation stamped thereon, or attached thereto, to indicate to the purchasing public or to the dealers that said hats wt>re, in fact, manufactured from old, worn, or prHiously used hat H & H HAT CO. 1485 1483 Complaint bodies. Said hats were resold to the purchasing public without the fact being disclosed that they were manufactured from old, Worn, or previously used hat bodies, nnu a substantial portion of the purchasing public was thereby misled to believe that they were, in fact, new hats manufactured entirely from new materials. As a result of thjs l'rroneous and mistaken understanding aJ1(l belief, substantial quantities of respondent's hats were purchased by members of the public.

PAR. 5. Through the use of the aforesaid acts and practices, the respondents placed in the hands of dealers the means and instrumentalities whereby said dealers may have deceived or misled lllembers of the purchasing public into the erroneous and mistaken belief that they were purchasing hats manufactured from new lllaterials when, in fact, said hats were composed entirely or in Part of old, worn, or previously usf'd hat bodies. PAn. 6. Among the hats manufactured by the respondent from. felt not previously used as felt, and which have been sold r.tnd Jishibuted by respondents since July 15, 1941, are many which are woo] Products· within the intent and meaning of the "\Vool Products Labeling Act of 193!), in that such hats are composed in part of Wool, reprocessed w·ool, or reused wool, as those terms are defined in said act. :Many of said wool products contain fibers other than wool, reprocessed wool, or reused wool Each of said wool products, when sold and distributed by the respondents in said commerce as aforesaid, was misbranded in violation of the "\Yool Products Labeling Act of 193D, in that said wool Product did not l~a\'e on or affixed thereto a stamp, tag, label, or any other means of identification, or a substitute in lieu thereof as Provided by said act, showing (a) the percentage of the total fiber :Weight of the wool product, exclusive of ornnmentation not exceed-· lng 5 percentum o£ said total fiber "·eight, of' (1) wool, {2) reprocessed wool, (3) reused wool, (4) each fiber other than wool where Said percentage by weight of such fiber was i5 percentum or more, and ( 5) the aggregate of all other fibers; (b) the maximum per- C<'ntage of the total weight of the wool product of nonfibrous loading, filling, or adulterating matter; (c) the name of the manufacturer of the wool product, or a registered 1mmber in lien thereof under the conditions provided in· the rules and rE:gulations promulgated under such act, or the name of one or more persons subject to section 3 of the said act with respect to such wool product. PAR. 7. The aforesaid acts, practices, and methods of respondents, as herein nlleged, are all to the prejudice and injury o:f the public 14SG FEDERAL TRADE COMMISSIO~ DECISIO~S Findings 34F. T. C.

and constitute unfair and deceptire acts and practices in commerce within the intent and meaning of the Federal Trade Commission Act.

REPORT, FINDINGS AS TO THE FACTS, 4.ND Onder Pursuant to the provisions of the Federal Trade Commission Act, the Federal Trade Commission, on the 14th day of November 1941, issued and subsequently served its complaint in this proceeding upon respondents, Daniel Hechtman and Steve l\Ioore, individually; and trading as II & H Hat Co., charging them with the use of unfair and deceptive acts and practices in commerce in violation of the provisions of said act and the provisions of the 1Vool Products Labeling Act of 1939. Subsequently, on the 15th day of January 1942, the Commission issued and thereafter served upon the respondents its amended complaint in this proceeding. After the issuance of said amended complaint, the Commission by order entered herein granted respondents' motion for permission to withdraw their answer filed to the original complaint and to file an answer admitting all of the material allegations of fact set forth in said amended complaint and waiving all intervening procedure and further hearing as to said facts, which 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 amended complaint and respondents' answer thereto, 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 and its conclusion drawn therefrom. FINDINGS AS TO Tile FACTS PARAGRAPH 1. Respondents, Daniel Hechtman and Steve :Moore, are individuals, trading as H & II Hat Co., and have their principal office and place of business at 1351 Milwaukee Avenue, Chicago, Ill. PAR. 2. Respondents are now, and for several years last past have been, engaged in the business of manufacturing women's hats from felt and other materials. Some of said hats have been manufactured from felt obtained from old, worn, or previously used hats and others are made £rom felt not previously used as felt. Respondents sell said hats to retailers, jobber~, and wholesale dealers located in the various States of the United States and the District of Columbia. Respondents cause said hats, when sold, to be transported from their place of business in the State of Illinois to the aforesaid purchasers located in various States of the United States other than the State H& HHATCO. 1487 1483 Findings of Illinois. Respondents maintain, and at all times mentioned herein have maintained, a course of trade in said hats in commerce among and between the various States of the United States and in the District of Columbia.

PAn. 3. In the course and conduct of their business, prior to July 15, 19-H, respondents bought olJ., worn, or previously used :felt hats. The old, worn, or previously used felt hat bodies were cleaned and shaped and fitted with new trimmings and sold by respondents to dealers who in turn sold said hats to the purchasing public. PAn. 4. The aforesaid hats manufactured from old, worn, or previously used hat bodies as hereinabove described had the appearance of new hats manufactured from new felt. "'When articles manufactured from old, worn, or previously used materials and having the appearance of being manufactured from new materials are offered to the purchasing public and are not clearly and conspicuously labeled, Us being manufactured from old, worn, or previously used materials, such articles are readily accepted by members of the purchasing public as being manufactured entirely from new materials. Said hats were sold to retailers and other dealers without any label, marking, or designation stamped thereon, or attached thereto, to indi- ~ate to the purchasing public or to the dealers that said hats were, In fact, manufactured from old, worn, or previously used hat bodies . . Said hats were resold to the purchasing public without the fact being disclosed that they were manufactured from old, worn, or previously '..!sed hat bodies, and a sub~tantial portion of the purchasing public ~as thereby misled to believe that they were, in fact, new hats manutactured entirely from new materials. As a result of this erroneous and mistaken understanding and belief, substantial quantities of respondents' hats were purchased by members of the public. PAn. 5. Tlu:ough the use of the aforesaid acts· and practices, ths respondents placed in the hands of dealers the means and instrulnentalities whereby said dealers may have deceived or misled members of the purchasing public into the erroneous and mistaken belief that they were purchasing hats manufactured from new materials When, in fact, said hats were composed ~ntirely or in part of old, "·orn, or previously used hat bodies.

PAR. 6. Among the hats manufactured by the respondents from felt ~ot previously used as felt, and which have been sold and distributed Y respondents since July 15, 19!1, are many which are wool prod- ~<'ts within the intent and meaning of the 'Vool Products Labeling ct of 1939, in that such hats are composed in part of wool, reprocessed Wool, or r£>used wool, as those terms are defined in said act. Many of 1488 FEDERAL TRADE C0l\IMISSION DECISIOXS 0t'(ler 3-!F.T.C. said wool products also contain fibers other than wool, reprocessedI wool, or reused wool.

Each of said wool products, when sold and distributed by the respondents in said commerce as aforesaid, was misbranded in violation of the Wool Products Labeling Act of 1939, in that said wool product did not have on or affixed thereto a stamp, tag, label, or any other means of identification, or a substitute in lieu thereof as provided by said act, showing (a) the percentage of the total fiber weight of th~ wool product, exclusive of ornamentation not exceeding 5 per centum of said total fiber weight, or (1) wool, (2) reprocessed wool, (3) reused wool, (4) each fiber other than wool where said percentage by weight ~:f such fiber was 5 per centum or more, and ( 5) the aggregate of all other fibers; (b) the maximum percentage of the total weight of the wool product of nonfibrous loading, filling, or adulterating matter; (c) the name of the manufacturer of the wool product, or a registered number in lieu thereof under the conditions provided in the rules and regulations promulgated under such act, or the name of one or more persons manufacturing for introduction, introducing said wool product into, or engaged in the sale, transportation, or distribution of said wool product in, commerce as "commerce" is defined in the Federal Trade Commission Act and in the Wool Products Labeling Act of 1939.

CONCLUSION The aforesaid acts and practices of respondents as herein :found are all to the prejudice and injury of the public and constitute. unfair and deceptive acts and practices in commerce within the intent and ·meaning of the Federal Trade Commission Act and the 'Vool Products Labeling Act of 1939.

ORDER TO CEASE AND DESIST This proceeding having been heard by the Federal Trade Com· mission upon the complaint of the Commission and the answer of respondents, in which answer respondents admit all the material allegations of fact set forth in said complaint and state that they waive all intervening procedure and further hearing as to said facts, and the Commission lmving made its findings as to t11e facts and conclusion that said respondents have violated the provisions of the Federal Trade Commission Act and the provisions of the 'Vool Products Labeling Act of 1939.

It is ordered, That the respondents, Daniel Hechtman and Steve Moore, individually, and trading ash & II Hat Co., or trading under H & H HAT CO. 148!} 1483 Ot·ller any other name, their representatives, agents, and employees, directly or through any corporate or other device, in connection with the offering for sale, sale, and distribution of hats in commerce, as "commerce" is defined in the Federal Trade Commission Act, do forthwith cease and desist from:

1. Representing that hats composed in whole or in part of used or second-hand materials are new, or are wmposed of new materials, by failure to stamp in some cmispicuous place on the exposed surface of the inside of the hat, in conspicuous and legible terms which cannot be removed or obliterated without mutilating the hat itself, a statement that said hats are composed of second-hand or used materials: Provided, That if substantial bamls, placed similarly to sweat bands in men's hats, are attached to said hats, then and in that event such statement may be stamped upon the exposed surface of such bands;· Provided further, That said stampings are of such nature that they cannot be removed or obliterated without mutilating the band and the band itself cannot be removed without rendering the hat unserviceable.

2. Representing in any manner that hats made in whole or in Part from old, used or second-hand materials are new or are composed of new materials.

It is further ordel•ed, That the respondents, Daniel Hechtman and Steve Moore, individually, and trading ash & H Hat Co., or trading U~der any other name, their representatives, agents, and employees, directly or through any corporate or other device, in connection With the introduction or manufacture for introduction of hats into commerce, or the sale, transportation, or distribution of hats in comlllerce, as "commerce" is defined in the Federal Trade Commission Act and the 'Vool Products Labeling Act of 1939, do forthwith cease and desist from misbranding hats which contain, purport to contain or in any way are represented as containing wool, reprocessed wool or reused wool, as those terms are defined in the 'Vool Products Labeling Act of 1939, by failing to place on or affix to each hat a stamp, tag, label, or other means of identification showing: (a) The percentage of the total fiber weight uf the hat, exclusive or ornamentation not exceeding 5 percentum of said total fiber weight, of (1) wool, (2) reprocessed wool, (3) reused woo], (4) each fiber other than wool where said percentage by weight of such fiber is 5 Per centum or more, and (5) the aggregate of all other fibers. (b) The maximum percentage of the total weight of the hat of llonfibrous loading, filling, or adulterating matter. 4G65Q6m--42--vo1.34----94 1490 FEDERAL TRADE COMMISSION DECISIO!\S Order 3-tF.T.C.

(c) The name of the manufacturer of the httt; cr the manufacturer's registered identification number and. the name of a subsequent seller of the hat; or the name of one or more persons introducing said hat into, or engaged. in the sale, transportation, or distribution of said hat in, commerce, as "commerce" is defineci. in the Federal Trade Commission Act and. the 'Vool Products Labeling Act of 1939. Subsections (a), (b), and (a) of this order are subject to the provisions of the ·wool Products Labeling Act of 1939 and the rules and regulations promulgated thereunder and are not to Le construed as limiting any applicable provision of said act or said rules and regulations. .

It i8 further ordered, That the respondents shall, within 90 days after service upon them of this order, file with the Commission a report in writing setting forth in detail the manner and form in which they have complied with this order.

ROBE-RT W. IRWIN CO. 1491 Com]1laint