David M. Weiss

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IN THE MATTER OF DAVID :M. WTEISS COMPLAINT, FINDINGS, AND ORDER IN REGARD TO THE ALLEGED VIOLATION Oil' SUBSEC. (C) OF SEC. 2 OF AN ACT OF CONGRESS APPROVED OCT. Hi, 1914, AS AMENDED Docket ~240. Complaint, Aug. 17, 19~0-Deoision, July 8, 19~S 'Where an Individual, engaged in New York City as commission re;;ident buyer of fur garments for some 60 retailers located in Detroit, Mich. ; South Bend, Ind.; Memphis, Tenn.; Atlanta, Ga.; and elsewhere in the United States• Who adv!.sed him generally as to the styles, sizes, and quality of garments desired and the price they wished to pay, and who, in making such purchases through him of sellers competitively engaged in said fur garment centet: of the United States, were in competition with many retailers who maintained buying offices in said city, or secured the services of expert buyers of furs . or "fee" buyers, or sent their own rept·esentatives to New York to purchase such garmentsneceived and accepted from sellers compensation, amounting to a certain percentage usually of the agreed sales price, on orders placed by him for them, while acting RS such retailer buyers' agent, buying representative, or other intermediary :

1Ieza, That such receipt of such compensation by said Individual, whlle acting as aforesaid, constituted a violation of subsection (c) of Section 2 of the Clayton Act, as amended by the no~inson-Patman fact. MT, Edwards. Ragsdale for the Commission.

ltb, Alfred McCormack and MT. Harmon Duncombe, of the firm of Cravath, DeGersdorff, Swaine & Wood, of New York City, for respondent. · Complaint The Federal Trade Commission having reason to believe that the Party-respondent named in the caption hereof, and hereinafter more Particularly designated and described, since June 19, 11)36, has ·violated and is now violating the provisions of subsection (c) of Section 2 of the Clayton Act, as amended by the Robinson-Patman Act, approved June 19, 1936 (U. S. C. Title 15, Sec. 13), hereby issues its complaint, stating its charges with respect thereto as follows: -....... PARAGRAPH 1. Respondent, David M. Weiss, is engaged in business as a commission resident buyer of fur garments, hating his principal ~fflce and 'place of business located at 370 Seventh A venue, New York City, N. Y. The respondent acts as agent for the purchase of gar- ~~nts for and in behalf of approximately sixty retail fur outlets here.a. lnafter called client buyers, located in the several States of the United States. · FEDERAL TRADE COMMISSION DIDCISIONS 66 Complaint 35F.T.C.

The respondent's operation of his business consists in general of receiving from client buyers requests, orders, or requisitions to purchase fur garments. Such requests advise the general specifications as to the type of garment, size, style, quality, and price. Upon receipt of such requests, orders, or requisitions, he calls upon various fur garment manufacturers, and when satisfactory merchandise is located he places an order for the client buyer at the most advantageous price :from the client buyer's standpoint. 'Vhen such orders are filled the merchandise is shipped by the manufacturer direct to the client buyer, although in some instances delivery is arrested to permit inspection of the garments by respondent at the respondent's place of business. On such orders the respondent generally receive's from the seller a commission of 5 percent.

New Yor~ City is the center of the fur garment industry in the United States and fur garment retailers located in States of the United States other than the State of New York undergo expenditures in purchasing fur garments in the New York City markets. Many of such retail buyers maintain in New York City buying offices or secure the services of expert buyers of furs known to the trade as "fee" buyers, or they send their own representatives to New York City to purchase such fur garments. Such buying arrangements are maintained and the personnel compensated by such retail purchasers and not by the fur garment manufacturers. Retailers purchasing through commission buyers are generally competitively engaged with retailers who purchase through buyers who are compensated by the retailers employing them. ' PAR. 2. In the course and, conduct of his business respondent places orders for fur garments with manufacturers located in New York City on behalf of retailers located in Detroit, Mich., South Bend, Ind., · Memphis, Tenn., and Atlanta, Ga., and elsewhere throughout the United. States, pursuant to ·which fur garments are shipped and caused to be transported by said sellers from New York City, N. Y., into and through various States of the United States to their respective customers.

PAn. 3. In the course of the purchasing transactions by the respond- , ent, as set forth herein, sellers have, since June 19, 1936, transmitted, paid, and dl'livered, and do transmit, pay, and deliver, to said respondent commissions, •the same being a certain percentage of the sales price agreed upon between each of such sellers and the respondent ojl the orders for merchandise placed by the respondent :for his principals; and said respondent, since June 19, 1936, has received and accepted, and is receiving and accepting, such commissions on purchases DAVID M. WEISS 67 Findings of merchandise by retail buyers in whose behalf said respondent has . been and is, in fact, acting. · PAR. 4. The foregoing acts and practices are in violation of subsection (c) of Section 2 of the Clayton Act, as amended. · Report, FINDINGs AS TO THE FACTs, AND ORDER Pursuant to the provisions of an act of Congress entitled HAn ~;tct t? supplement existing laws against unlawful restraints and monopo- . hes, anrl for other purposes," approved· October 15, 1914 (the. Clayton Act), as amended by an act of Congress approved June 19, 1936 (the llobinson-Patman Act) (U.S. C. Title 15, Sec.13), the Federal Trade Commission on August 17, 1940, issued and subsequently served its ~0ll1plaint in this proceeding upon respondent, David l\1. Weiss, charglng him with violation of the provisions of subsection (c) of Section 2 of said act, as amended. After the issuance of said complaint and the filing of respondent's answer,· the Commission entered its order granting 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 inter- Vening procedure and further hearings as to said fa~ts. The r.espond- €n~ also waived oral argument and the filing of briefs ... Thereafter, th_Is proceeding regularly came on for final hearing before the Comll1~ssion on the said complaint and substitute answer, and the Com- ~llssion having duly considered the same and being now fully advised 1~ the premises, makes this its findings as to the facts and its conclu- Sion drawn therefrom. · FINDINGS AS TO THE FACTS PARAGRAPH 1. Respondent, David 1\f. 'Weiss, an individual, is a eommission resident buyer of fur garments, having his principal office ttnd place of business at 370 Seventh Avenue, New York, N.Y. • PAn. 2. In the course and conduct of his business, respondent, act- Ing in behalf of retailers located in various States of the United States other than the State of New York, places orders for :fur garments with ll1anufacturers and wholesalers located inn ew York, N.Y. Pursuant to such orders, fur garments are caused to be transported by said nll~rs :from New York City through and into various States of the united States to the locations of the respective purchasers. · • ~AR. 3. The center of the fur garment industry in the United States Is In New York City. Retailers of fur garments located throughout the United States purchase supplies offur garments in the New York 68 FEDERAL TRADE COMMISSION DE1CISIONS Findings 35F.T.C.

market. Respondent's business as a commission resident buyer con~ sists of acting for and in behalf of retailers of fur garments and as agent for such retailers in the purchase of supplies of fur garments from manufacturers and wholesalers of such garments in New York City. Respondent has as clients some sixty retailers of fur garments, who have their places of business in Detroit, Mich., South Bend, Ind., Memphis, Tenn., Atlanta, Ga., and elsewhere in the United States. These retailers advise respondent of the types of fur garments they wish him to purchase for them, and generally as to the styles, sizes, and quality of garments desired and the price they wish to pay. Upon receipt of such requests or orders, resJ)ondent calls upon various manu· facturers of fur garments in the New York market, inspects the gar· ments they have :Cor sale, and selects for his clients those garments which he considers the most advantageous purchase for them. When orders so placed are filled, the merchandise is shipped by the manu· facturer direct to the retail buyer, a:lthough in some instances delivery is arrested to permit inspection of the garments by respondent at his place of business. On purchases made as ·a~oresaid,· the respondent generally receives from the seller a commission of 5 percent of the purchase price.

Retailers of fur garments who purchase supplies of such garments in the New York market utilize various means in making their pur· chases. l\Iany such buyers maintain buying offices in New York City, or secure the services of expert buyers of furs known to the trade as "fee" buyers, or send their own representatives to New York City to purchase fur garments. Buying arrangements of the kind stated are maintained and the personnel compensated by the retail pur· chasers and not by the fur garment manufacturers. Retailers who l:icar the cost of purchasing fur garments by maintaining and compen· stating buying personnel are in competition with retailers who utilize the services of respondent, who is compensated by the sellers .. PAR. 4. In the course of the transactions· of purchase negotiated by respondent or in which he assists, sellers have since June 19, 1936, transmitted, paid, and delivered, and do transmit, pay, and deliver commissions on such transactions to said respondent. These corn· missions are usually in the form of a certain percentage of the sales price agreed upon between each of such sellers and the respondent on orders placed by the respondent :Cor his principals, and the said respondent has received and accepted, and is receiving and accepting, such commissions on purchase's of ,merchandise by retail buyers in whose behalf respondent has been and is in fact acting. DAVID M. WEISS 69 65 Order CONCLUSION The Commission, concludes that respondent, David M. 'Veiss, is €ngaged in business in commerce as agent, buying representative, or other intermediary, in or in connection with buying fur garments ~rom competitive sellers for retailers of fur garments, and has acted 111 fact for or in behalf of, or under the direct or indirect control of, such buyers; and, in the course of such commerce, while acting in fact ~s agent, buying .representative, or other intermediary for the buyer 111 the purchase of fur garments, has received compep.sation in the form of commissions or otherwise, from the sellers from whom purchases were made, in violation of the provisions of subsection (c) of Section 2 of "An act to supplement existing laws against unlawful _restraints and monopolies, and for other purposes," approved October 15, 1914 (the Clayton Act), as amended by an act of Congress ap- Proved June 19, 1936 (the Robinson-Patman Act) (U. S. C. Title 15, Sec. 13).

ORDER TO CEASE AND DESIST . This proceeding having been heard by the Federal Trade Conunis-' Ston upon the complaint of the Commission and the substitute answer 0~ respondent David M. 'Veiss, which answer admits all of the matellal allegations of the complaint to be tme, waives further hearing a~ to said facts and all other intervening procedure, and the Commis- Ston having made its findings as to the facts and conclpsion herein that said respondent, David M. Weiss, has violated the provisions of subsection (c) of Section 2 of "An act to supplement existing laws against unlawful restraints and monopolies, and for other purposes," approved October 15, 1914 (the Clayton Act), as amended by an Act ~ Congress approved June 19, 1936, (the Robinson-Patman Act) ~ S. C., Title 15, Sec. 13). · _Jt is ordered, That the respondent, David M. Weiss, an indi~idual, hts agents, employee$ and representatives, directly or through any cor- Porate or other device in or in connection with the purchase of furs, fur garments or other commodities in commerce, as commerce is ll.efined in the af~resaid Clayton Act, as amended, do' forthwith cease and desist from :

h Receiving or accepting directly or indirectly anything of value as rokerage, commission or other compensation or any allowance or discount in lieu thereof from any seller on or in connection with purchases lllade from such seller (a) when such purchases are made for respon.dent's own account, or (b) when such purchases are made as agent or buying representative of the purchaser, or (c) when in making such Order 35F.T.C..

purchases respondent is acting in fact for or in behalf, or is subject to the direct or indirect control, of the purchaser. It is further ordered, That the respondent shall, within 60 days after service upon him of this order, file with the Commission a report in'writing, setting forth in detail the manner and form in which be has complied with this order.

JACK HERZOG AND COMPANY 71 ·.,.

Complaint