Lustberg, Nast & Company, Inc.

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. IN THE l\IATTER OF LUSTBERG, NAST & COMPANY, INC.

COMPLAINT, FINDINGS, AND ORDER IN REGARD TO Tile ALLEGED VIOLATION OF SEC. 5 O.F AN ACT OF CONGRESS APPROVED SEPT. 26, 1914 Docket 2536. Complaint, Nov. 22, 1938'-Deei.~-ion, July 10·, 1942 \Vhere a corporation, engaged In the manufacture and competitive interstate sale and distribution of heavy clothing used by sportsmen and outdoor' workers, including coats, shirts, mackinaws, jackets, and. other garments made ft·om woven fabrics of cotton, wool, and rayon- Featured in advertisements in newspapers and magazines of nation-wide. cir· culation, in trade literature and on labels attached to Its products aud their containers, its registered trade-marks displaying prominently "13ncl> Skein," with or without a deer's head, along with such additional worm as "Jacket," "Trousers" and "Rain Coat," and including· among its marks "Ducic Skein Joe" and "Lady Duck Skein," and thereby represented that its said garments wet·e made of buckskin, nothwithstanding use of snell expressions In small type and in inconspicuous' place in its advertising ll~ "looks like leather, wears fot·ever," "all wool," ''looks like buckskin," and "Double Weight Buck Skein Fabrics";

When In fad they wet·e not made of the skin of a deer or an elk-gat·ments of which, with their soft, pliable, lightweight and water-resistant qualities, nre prefen·ed, especially among sportsmen and those engaged in outdoor world>• over the much less costly garments of woven fabric-but were made as qforesaid from wool, cotton, and rayon fabrics; With effect of giving its auvertisements a greater force and drawing power than· those of its compf•titot·s who do not represent their similar products as buckskin; of placing in the hands of retailers and other dealers means 1 of making and furthering such false representations and thus enabling thelll 1 to Increase sales of its product!'!, thereby lessening the market for similar 1 goods, the nature of which is truthfully stated; and of misleading aud ! deceiving a substantial portion of the purchasing public into the misw.ten i belief that such representations were true and into the purchase, as a . \ result, of a substantial volume of its said garments; whereby trade was 1 unfairly diverted to it from competitors who truthfully represent 'tbelr l, products; to the injury of competition in commerce: Jleld, That such acts and practices, under the circumstances set forth, were all to the prejudice and injury of the publlc and competitors, and cou· stltuted unfair methods of competition in commerce and unfair and decep· tive acts and practices therein .

. Before Mr. Edward }./, Averill, Mr. John J. Keenan, Mr. ArtM.Jt F. Thomas and Mr. Lewis 0. Russell, trial examiners. Mr. John lV. llilldrop and M_r. James M.llammond for the Corn· mission.

Kadel, Sheils & Weiss and Stroock & Stroock, of New York City, · and Mr. Logan Morris, of 'Vashington, D. C., for respondent. • Amended.

LUSTB'ERG, NAST & CO., INC. 133 132 Complaint AMENDED Col\IPLAINT Pursuant to the provisions of the Federal Trade Commission Act, by virtue of the authority vested in it by said act, the Federal ;ld l rude Commission, having reason to believe that Lustberg, Nast & Co., nc., hereinafter referred to as respondent, has violated the provisions ~f ~h~ said ~ct, and it app~aring to the Commission that a proceeding • Y It m respect thereof would be in the public interest, hereby issues lts amended complaint, stating its charges in that respect as follows: • ~ARAGRAPH 1. The respondent is a corporation, organized and ex- ~shng- pursuant to and under the laws of the State of New York, with ~ts office and principal place of business located at 212 Fifth Avenue, ~n the city of New York, State of New York. It operates factories tocuted at Lebanon, Pa., and Middletown, N. Y. It is, and for more .hun 1 year last past has been, engaged in the manufacture, nmong other things, of heavy clothing such as is commonly used by sportstnen, and outdoor workers. It causes said products, when sold, to be shipped from its factories, located as aforesaid, or from its principal jlace of business in New York City, N. Y., to purchasers thereof ~cated in other States of the United States and in the District of columbia. Respondent maintains, and at all times mentioned herein hus maintained, a course of trade in said clothing in commerce among und between the various .States of the United States and in the District of Columbia. In the course and conduct of its business, said respondent has been at all times herein referred to in competition with other ~orporations, firms, partnerships, and individuals also engaged in the ~ale ~nd distribution of. similar products or other products designed or Similar wear in commerce among and between the various States of the United States and in the District of Columbia. PAn. 2. In the course and conduct of its business as described in ~aragraph 1 hereof, the respondent adopted and now uses the term ~uck-skein" as a trade name, to designate a line of its products con- ;Isting of coats, shirts, mackinaws, jackets, and other garments manunctured from woven fabrics made of such materials as cotton, wool, and rayon. In some instances, the material used js rubberized or proc- ~ssed by .or at the instance of the respondent, to give it~waterproofing or rain-resisting qualities. ·Uor the purpose of aiding, assisting, and furthering the sale of its products to the purchasing and consuming PUblic, the respondent causes advertisements and repre~entatim1s in Which, arvong other ways, it prominently disphys in very large type ~he term "Duck-skein," to be inserted in newspapers, magazines, and Journals of Nation-wide circulation, and in its trade literature. To further stress the significance and meaning desired to be given to this 134 FEDERAL TRADE COMMISSION DE,CISIONS \ Complaint 35 F. T.C. I term and to increase the.drawing po"·er of its ad\'ertisements, respond· ent generally places immediately above, and in close juxtaposition Itherewith, a picture of the head of a deer. Labels, similarly embel· lished with this design, either with or without the deer head, are generally affixed by respondent to its products. In some instances the term "Buck-skein Joe" is used in like m:mner. II . PAR. 3. Buckskin is the skin of either the deer or elk, which bas been tanned by what is known as the oil process. It is exceedingly I durable and possesses the quality of being highly resistant to wind and weather. It is also soft, pliable, light in weight, and may be washed. It is water-resistant without the disadvantage of being air· tight, and permits sufficient" air to pass through to allow its ·use as garment, shoe or glove leather. It is highly prized for these desirable qualities, especially by sportsmen and those engaged in outdoor world, and is far more expensive than any manufactured cloth or fabric used or substituted for a like purpose and is preferred by many such users · to.any other material for use in garments for sport or outdoor wear. ' PAn. '4. The term "Buck-skein" is a slightly distorted spelling of the word "buckskin" and is unfairly simulative thereof. The re· spondent's use, in its advertisements and in the other ways herein mentioned, of the term "Buck-skein" and the picturization of a deer head, either separately or in .conjunct~on therewith, to describe, desig· nate or refer to respondent's garments made from woven fabrics serves as representations that said garments so described or designated are actually made from bu~kskin, the oil tanned skin of the deer or elk, or possess the desirable and pre.ferable qualities and character· istics of buckskin. The garments manufactured, sold, and represented i>y the respondent, as described in paragraphs 1 and 2 hereof, are not made from buckskin, or any other leather product, but are manufac· tured frorri woven fabrics made of such materials as wool and cotton and do not possess the desirable and preferable qualities and char· acteristics of buckskin.

Respondent's false and deceptive representations also serve to un· fairly attract the attention of the public to respondent's advertise· ments and gives them.a greater force and drawing power to pure hasers and prospective purchasers than advertisements of respondent's com· petitors who manufacture and sell similar garments but who do not represent the same as "Buck-Skein" or in any other way lead the public into the mistaken bE:'lief that their products are made from buckskin or possess the qualities or characteristics of buckskin. ' Respondent's acts and practices as herein set out have also placed in the hands of retailers and dealers the means of making and further· ing such false and misleading representations and have enabled such· LUSTBERG, NAST & CO., II\'C. 135 132 Findings retailers and dealers to increase their own sales of respondent's Product so designated, described and represented, thereby lessening the market :for similar goods, the nature, quality and character of 'Which is truthfully stated.

PAn. 5. Outdoor garments of sundry competitors of respondent are and have been sold and distributed in commerce among and between the. various States of the United States to the purchasing and co.nsuming public in -competition with respondent's products, but '"ithout fictitious and erroneous statements and representations with • reference to the quality, nature, or character of materials used in their manufacture.

PAn. 6. The use by the respondent of the false and misleading statements and representations as hereinabove set out, in offering for sale and in selling its products, was and is calculated to, and had, and now ~as, a tendency and capacity to mislead and deceive a substantial porholl of the purchasing and consuming public into the mistaken· and erroneous beliefs that all of said representations are true, and that · ~aid garments so described and designated are actually made from 0U<'kskin or possess the desirable and preferable qualjties and characteristics of buckskin and into the purchase of a sqbstantial volume of respondent's garments in and on account of said beliefs induced by the aforesaid acts, practices and misrepresentations of respondent. As a result, trade has been diverted unfairly to the respondent from ?orporations, firms, partnerships, and individuals lilmwise engaged . 1n the business of manufacturing, distributing, and selling similar garments in commerce among and between the various States of the Dnited States who truthfully advertise and represent their products. In consequence thereof injury has been, and is now being, done by respondent to competition in commerce among and between the '\Tarious States of the United States and in the District of Columbia. ·PAn. 7. The foregoing acts and practices of the respondent as herein' alleged are all to the prejudice of the public and of respondent's com-. Petitors 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. '·'- REPORT, FINDINGS AS TO THE FACTS, AND ORDER Pursuant to the provisions of the Federal Trade Commission Act, the Federal Trade Commission, on the 30th day of August, A. D. 1935, issued and thereafter served its complaint in this proceeding Upon, the respondent, Lustberg, Nast & Co., Inc., a corporation, and ?n the 22d day of November, A. D. 1938, issued and thereafter served FEDERAL TRADE COMMISSION DEoCISJ:O~""S 136 Findings 35F. T.C.

its amended complaint upon· the respondent, charging it with unfair methods of competition in commerce and unfair and deceptive acts and practices in commerce, in violation of the provisions of said act. After the issuance of the original complaint and the filing of re· spondent's answer thereto, testimony and other evidence in support of the allegations of the complaint were introduced by the attorney for the Commission before a duly appointed trial examiner of the Commission designated by it to serve, in this proceeding. After the issuance of the amended complaint . and the filing of respondent's answer thereto, testimony and other evidence in support of and in • opposition to the allegations of said complaint wer81 introduced by attorneys for the Commission. and :for the respondent before duly appointed trial examiners of the Commission designated by it to serve in this proceeding; and it was stipulated between the said attorneys that the testimony and evidence introduced in support of the original complaint should have the same :force and effect as · if introduced in support of the amended complaint. The testimony and other evidence were duly recorded and filed in the office of the Commission.

Thereafter, the proceeding came on for final hearing before the Commission on the amended complaint, the answer thereto, the testimony and other evidence, reports of the trial examiners and exceptions thereto, briefs in support o:f and in opposition to the allegations of the complaint, and oral argument. And the Com· mission, having ·duly considered the matter and being now fully ad· vised 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 con· elusion drawn therefrom.

FINDINGS AS TO THE FACTS PARAGRAPH 1. Respondent is a corporation organized under the laws o:f the State of New York having its principal place of business in the city and State of New York, ·with factories located at Lebanon, Pa., .and :Middletown, N.Y. Respondent, :for more than 20 years last past lias been and now is engaged in the manufacture and sale o:f heavy clothing, such as is commonly used by sportsmen and outdoor workers, including coats, shirts, mackinaws, jackets, and other gar· ments manufactured from woven fabrics of such materials as cotton, wool, and rayon. Respondent causes its products, when sold, to be shipped from its factories or its pJ,'incipal place of business to pur· chasers thereof located in numerous States of the United States other than the State of origin of such shipments. Respondent maintains, I .LUSTBERG, NAST & co., INC. 137 132 ' Findings ltnd at all times herein mentioned has maintained, a course of trade in said products in commerce between and among the various States of the United States, and during all of said time has been in ~compe­ tition with other corporations and with individuals, firms, and Partnershipso en..,.aO'edt':) b in1 the sale and distribution of similar products ln commerce between and among various States of the United Sta~es. PAR. 2. Respondent, in June 1924, registere~ a trade-mark in the l.Jnited States Patent Office, consisting of the words "Duck Skein,'~ and between the two words appeared a deer's head surmounted by ~ntlers. Respondent subsequently also registered other trade-marks featuring the words "Duck Skein," sometimes with and sometimes Without an accompanying deer's head, with such additional words lls "jacket," "trousers," "rain coat." "Duck Skein Joe" is one of respondent's trade-marks; "Lady Duck Skein" is another .. Respondent, for the purpose of promoting· the sales of its product, causes advertisements to be inserted in newspapers, magazines, ·aml Journals• of nation-wide circulation, and in trade literature,I in which its said trade-marks are displayed in large and conspicuous type, nnd on the labels attached by respondent to its various products -and on the containers thereof, its trade-marks are also prominently dis- Played .. The trade-mark most generally used by respondent in this ' connection is that consisting of the words "Duck Skein" and de- Picting th~ antlered deer's head between the two words. The drawing Power of respondent's advertiserpent is enhanced by this picturization of a deer's head in connection with the words "Duck Skeiri,'~ 1 Which induces the public to mistakenly believe that respondents Products are made from the skin of a deer.

. Buckskin is the skin of a deer or elk. It is exceedingly durable, ls highly resistant to wind and weather, is soft, pliable, light in '"eight and water-resistant. The cost of garments made of buckskin greatly exceeds that of garments made of cloth or other woven fabric ordinarily used for such purpose, and there is a preference, especially atnong sportsmen and those engaged in outdoor work, fo·r garments tnade of buckskin. · PAR. 3. The term "Duck Skein" used by respondent is a slightly distorted spelling of "buckskin" and when used by respondent either Eieparately or in conjunction with the picturization of a deer's head to describe, designate or refer to its garments made of woven fabric Serves as a representation that such garments are actually made of buckskin. · · The garments manufactured, sold and represented as described in }:laragraphs 1 and 2 hereof, are not made from buckskin or any other ~38 FEDERAL TRADE COMMISSION DECISLW!NS Findings 35F. T.C.

leather product, but are manufactured from woven fabrics made of f·uch material as wool, cotton, and rayon.

· Respondent's said false and deceptive representations· serve un· fairly to attract the attention of the public to its advertisements and gives to them a greater force and drawing power than those of its -<:ompetitors who manufacture and sell similar garments, but who do ·not represent them as "Buck Skein'' or otherwise lead the public 'into the mistaken and erroneous belief that their products are made l()f buckskin.

Uespondent, by its said acts and practices has placed in the hands of retailers and other dealers the means of making and furthering' such false and misleading representations, and has enabled them thus to increase th~ sales of respondent's products, thereby lessening' the market :for similar goods, the nature, quality ·and character of which are truthfully stated. • ..PAn. 4. The use by rpspondent of the false and misleading state· ments and representations as herein stated has the tendency and capacity to, and does, mislead and deceive a substantial portion of the purchasing public into the mistaken and erroneous belief that E:uch representations are true, and that the garments sold by re· spondent are made from leather or buckskin, and because of such belief, to purchase a substantial. volume of respondent's said gar· ments. As a result, trade has been unfairly diverted to respondent :fr:om competitors selling similar garments in commerce between and among various States of the United States who truthfully advertise 11nd represent their products. In consequence thereof, injury bas been and is now being done by respondent to comp.etition in commerce between arid among the various States of the United States. PAn. 5. The record does not disclose that anyone examining re· E-pondent's products believe they· were made of buckskin, but ten persons who ordered respondent's products as a result of having ~een its said advertisements, did so in the mistaken bel~ef that the products Qrdered were made of leather or buckskin. Eight witnesses, after reading respondent's said advertisements, testified that they believ~d -respondent's products were made of buckskin or other leather. The use by respondent of the words "Buck Skein," with or without the deer's head in juxtaposition thereto, causes the purchasing public to believe that respondent's products are made of leathet• or buckskin, ·or possess some of the prized qualities or characteristics of buckskin; and such belief is not affected by. such expressions as "looks like leather, wears forever," "all wool," ''looks like buckskin," and \~Double • ·weight lluck Skein Fabrics" appearing in small type in an incon· 'i'picuous place in respondent's advertisements. · LUSTBERG, NAST & co., IN'C. . L 139 132 . Order CONCLUSION The aforesaid acts and practices of the respondent are all to the Prejudice and injury of the public and of respondent's competitot'!', and consti-tute unfair methods of competition in commerce and unfair nnd deceptive acts and practices in commerce, within the intent and lb.meaning of the Federal Trade Commission Act. ORDER TO CEASE AND Desist This proceeding having been heard by the Federal Trade Commission upon the amended complaint of the Commission; the r£'spondent's answer thereto; testimony and other evidence in support of and in opposition to the amended complaint introtluced by attorneys for the . ~ommission and for the respondent before duly appointed trial exam- Iners of the Commission designated by it to serve in this proceeding and, by stipulation betv;·een attorneys for the Commission and the ~respondent, the testimony introduced in support of the original complaint; reports of the trial examiners and exceptions thereto; briefs Jn support of and in opposition to the amended complaint, and oral argu;ment, and the Commission having made its findings as to the facts and its conclusion that respondent has violated the provisions of the Federal Trade Commission Act.

It i8 ordered, That respondent, Lustberg', Nast & Co., Inc., a corporation, its officers, directors, representatives, agents, and employee::;, directly or through any corporate or otlwr device, in connection with the offering for sale, sale and distribution of coats, shirts, mackinaws, jackets, or other gnrments, in commerce as "commerce" is defined in the Federal Trade Commission Act, do forthwith cease and desist from:

1. Using the term "Buck Skein," either alone or in conjunction "'ith the outline of a deer's head, or any otlwr colorable simulation of the word "buck skin," in advertising, or otherwise, to describ~-', designate, or refer to any product which is not made from the skin of a deer or elk;

. 2. Representing directly or by implication in any advertisement, or on labels, or otherwise, that any product made of wool Or cotton or nny other woven fabric· is made of buckskin or other type of leather . . It is further ordered, That the respondent shall, within <iO days after service upon it of this Ql'ller, file with the Commission a report in writing, setting iorth in detail the manner and form in which it has complied? with this order.

FEDERAL TRADE COMMISSION DECJSJ:ON:S140 Syllabus 35F. T.C.