Abraham Welkin

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IN THE MA Tler OF .ABRAHAM WELKIN AND MINNIE WELKIN, TRADING AS PUINCESS YARN COMPANY COi\,:plaint, FINDINGS AND ORDER IN REGARD TO Tile ALLEGED VIOLATION OF SEC.' 5 OF AN ACT OF CONGRESS .APPROVED SEPT. 26, 1914 Do(!ket 4631. Complaint, Jan. :1!2, 1942 '-Decision, Aug. 25, 1942 Where two Individuals, engaged in interstate sale and distribution of knitting Yarns- ( a) Made use in catalogues and on labels attached to their products of such terms as "Cashmere Sport Yarn," "Sporting Angora," "Shetland Floss," "Zephyr Tweed," and "Deluxe Tweed," under8food by a substantial portion of the purchasing public to mean, respectively, yarns composed o! the hair of the Cashmere goat, of the Angora goat, of wool derived from Shetland Sheep raised on the Shetland Islands or the contiguous mainland of Scot· 'r lund, or composed entirely of wool; . he facts being said "Cashmere Sport Yarn" was not composed In whole or In Part of the hair of the Cashmere goat, said "Spo.rtlng Angom" was about 25 Percent rabbit's hair and 75 percent wool, said "Shetland Floss'' was made ofi · domestic wool, and said "Zephyr·Tweed" and "Deluxe Tweed" were not alli Wool, but contained both wool and rayon; l (b) Falsely represented. as silk yarns composed of cotton, rayon, and silk, and Of 50 percent wool and 50 percent rayon, through designations "Silk Flake"I ( llnd "Silk Wool," respectively; tl . i· c) Misrepresented their aforesaid and their ''Frosted Zephyr," "Pompadour," '' and "Zephyr Paradise," and other yarns, through failure to .disclose that they were composed in pprt of rayon which, when made to simulnte slllt ·or Wool, Is practically indistinguishable therefrom; with result that a substantial portion of the purchasing public bought said yarns as composed ot i! the genuine product simulated thereby; (d) Falsely represented certain of their products as imported from Scotland or the Province of Saxony, respectively, through use of designations "Scotch ( Tweed" nnd "Saxony Zephyr" to describe yarn of domestic manufacture; and e) li'falsely representt>d that they owned a factory In which they manufacturedI: the yarns they sold, through use of words "Office and Factory at 4!> Essex Street, New York City"; notwithstanding fact they bought their suppllett \\1 from domestic manufacturers; , 1th tendency and capacity to mislead and deceive a substantial portion ofi I the purchasing public into the mistaken belief that said representations were true, thereby Inducing It to purchase their products because of such belief: 11 ela, Tliut such acts and practices, under the circumstances set forth, were. aui to the prejudice and Injury of the public, and constituted unfair and deceptive acts and practices in commerce.II jJ.Jr, John lV. Addison; trial examiner. I Before I . J./'1', Donovan Divet for the Commission. I Mr. S. Robert Israel, of New York City, for respondents.' "'7--- . Amended .and supplemental. Complaint 35F. T.C.

AMENDED AND SUPPLEMENTAL Complaint Pursuant to the provisions of the Federal Trade Co~mission Act, and by virtue of the authority vested in it by said act, the Feder~l Trade Commission having reason to believe that Abraham Welkin and l\finnie W~lkin, his wife, individually, and trading as P~inches~ Yarn Co., heremafter referred to as the respondents, have violate the provisions of said act, and it appearing to the Commission that 11 proceeding by it in respect thereof would be in the public intere~t, hereby issues its amended and supplemental complaint stating Its charges in that respect as follows: . P ARAGRAPII 1. The respondents, Abraham · Welkin and Min~le Welkin, his wife, are individuals, trading as Princess Yarn Co., w~th their principal place of business located at 49 Essex. Street, in the eM of New York, State of New York. ,t PAR. 2. Respondents are now and for more than 2 years last pasd have been engaged in the sale and. distribution of various grades an types of knitting yarns. Respondents cause their said products, whef sold, to be transported from their place of business in the State. 0 New York to purchasers thereof at their respective points of locatiO~ in the various other States of the United States and in the District~ Columbia. Respondents maintain and at all times mentioned herein have maintained a course of trade Wtheir said products in commerce between and among the various States of the United States and in the District of Columbia.

PAn. 3. In the course and conduct of their·business and for the pur· pose of inducing the purchase of their said products the respondent~ have engaged in the practice of falsely representing the constituen fiber or material of which their products are made, such false re~re­ sentations being made by means of statements and legends appear111g · in catalogs and on labels attached to said products and 'in other printed and writte:o material w{lich they have distributed among cus· tamers and prospective customers located in the various States o£ the United States and in the District of Columbia. £ Typical of the aforesaid practices is the use by the respondents ? the words "Cashmere Sport Yarn" to designate and describe certaifl . • yarns which are not composed, in whole or in part, of the hair of. the Cashmere goat. , . The word "Cashmere" has long been understood and accepted bJ the purchasing public as designating and describing a particular ty~~ of wool derived from the hair of the Cashmere goat and when sal word is used to designate and describe yarns having the general ~p­ pearance of wool is understood by the purchasing public as denoting a product made entirely from the hair of the Cashmere goat. PRINCESS YARN CO. 373 Complaint ,: .A. further example of respondents' practice is the use of the words · Sporting Angora'' to designate and describe yarns which are not colnposed, in whole or in part, of the hair of the Angora goat. The word "Angora" has long been understood by the purchasing illblic as designating and describing a particular type of wool derived roln the hair of the Angora goat and when said word is used to designate and describe yarns having the general appearance of wool is lln~erstood by the purchasing public as denoting a product made entirely from the hair of the Angora goat. ' . · " A further example of respondents' practice is the use of the words · Shetland Floss" to designate and describe yarns which are not com- ~osed, in whole or in part, of the wool of Shetland sheep raised on the h~tland Islands or on the contiguous mainland of Scotland. The word "Shetland" has long been understood by the purchasing ~llblic as designating and describing a particular type of wool derived ~om the fleece of Shetland sheep raised on the Shetland Islands or on \ e contiguous mainland of Scotland and when said word is used to ~designate and describe yarns having the general appearance of wool ~s Understood by the purchasing public as denoting a product made t·orn the wool of such Shetland sheep. · Each of the afm•e described wools has been for a long time and is now and favorably known to the purchasing public and there is a;en . elnand, public acceptance, and preference on the part of the purchaslng public for yarns made therefrom.

"ZA further example of respondents' practice is the use of the terms t .ephyr Tweed" and "Deluxe Tweed" to designate and describe cerdat~ of their yarns which are not composed entirely of wool. The yarns ~ 81 gnated "Zephyr Tweed and "Deluxe Tweed" ai·e composed of wool "'1th .rayon nubs.

The word "Tweed" has been long and favorably known. to the Purchasing public as descriptive of products composed entirely of "'ool, .

t :PAR, 4. Another and typical act on the part of the respondents is ~at of falsely representing that certain of their yarns are composed of ~Ilk or of a mixture of silk and other materials wl1en such is not the ,,a~t. Among such representations are the legends "Silk Flake" and Sllk 'Vool." "Silk Flake" does not contain any silk but is .composed of a mixture of cotton and rayon. "Silk 'Vool" contains no silk but is cornp?sed of a mixture of wool and rayon.

th The word "Silk" has had for many years and still has in the mind of e purchasing public a definite and specific meaning, to wit: The l>product of the cocoon of the silkworm. Silk products for many years 374 FEDERAL TRADE COMMISSION. DECISIONS Complaint 3:3 F. 'f, C. have held and still hold the confidence and esteem of the public for their preeminent qualities. . Rayon is a chemically manufactured fiber or fabric which may be so manufactured as to simulate silk or wool. 'Vhen manufactured to simulate silk it has the appearance and feel of silk and when manufac· tured to simulate wool it has the appearance and feel of wool. 13Y reason of these qualities rayon when manufactured to simulate silk or wool and not designated as rayon, is by the purchasing public prac· tically indistinguishable from silk or wool as the case may be. Prod· ucts made of rayon are accepted by the purchasing public as silk or wool even though such products may }'lot be designated by terms repre· ~enting or implying that they are silk or wool. The respondents also sell and distribute other types of yarn c_on· t.aii1ing rayon without. disclosing the rayon content of such products. Among such products are. the yarns hereinbefore referred to 11~ ''Zephyr Tweed," "Deluxe Tweed,", "Silk 'Vool," "Silk Fl:lke" and certain other yarns designated by the respondents as "Frost~ Zephyr," "Pompadour," "Zephyr Paradise," "Tropical Nub," "Mystic and Nub Velveen" and "Velveen." AU of said yarns contain sub· ~tantial percentages of rayon ·which has been manufactured so as to simulate wool or a mixture of silk and wool and said products have the appearance of wool or a mixture of silk and wool and are under· stood and accepted by the purchasing public as such. PAR. 5. lly the means and in the manner aforesaid responden~s also engage in the practice of falsely representing the place of origin of certain of their products. Among and typical of such false reprd sentations are the legends "Scotch Tweed" find "Saxony Zephyr" us\ in designating certain of their yarns. Through the, use of sue legends the respondents represent that the yarn designated "Scotch Tweed'~ is made from wool imported from Scotland and that. the yarn designated "Saxony Zephyr" is made ·from wool imported fro~ Saxony. In truth and in fact the wool used in making such yarns lS not imported from said locations. · . PAR. 6. Respondents have also misrepresented the nature of thelt business by using the words "Offices and Factory at 49 Essex Street, New York City," in their catalogs which display the various kinds of yarn which they offer for sale, thereby 'representing that they are the owners of and conduct a factory in which their said yarns a.re spun and that they are the manufacturers of said yarns .. In truth and in fact, respondents· do not operate or control find have not either operated or controlled a. plant, factory or machinery for th8 manufactu~~ of their products, but on the .contrary the respondents buy such articles of merchandise which are made or manufactured ~RINCESS YARN CO. 375 371 Findings in a plant or factory and by machinery which they neither own, PPerate, nor control.

·· PAR. 7. A substantial number of the members of the purchasing' PUblic has a preference for buying merchandise, including the prod- ~ct~ sold by respondents, directly from the manufacturers thereof, eheving that by so doing a more uniform line of goods, superior quality, lower prices and other advantages can be obtained. · .. t' PAn. 8. The use by the respondents of the foregoing acts and praolces. has had and now has a tendency and capacity to mislead and deceive a substantial portion of the purchasing public into the erro- ~eous and mistaken belief that sai~ statements and representations are fi~Ue and that respondents have truthfully repres~nted the constituent er and material of which their products are made, as well as the ~at.ure of their business. As a result of such erroneous and mistaken . ehef engendered as herein set forth the purchasing public has been l.nduced to purchase and has purchased substantial quantities o:f respondents' products.

h P ~· 9. The aforesaid acts and practices of the respondents as erein alleged are all to the prejudice and injury of the public and ~hns~itute unfair and deceptive acts and practices in commerce within e lntent and meaning· of the ¥ederal Trade Commission Act. llEPonT, FINDINGS AS TO THE FACTS, AND Onn:m h Pur~uant to the provisions ~f the Feder~! Trade Commission Act, t e Federal Trade Commission on November 13, 1941, issued and subsequently served its complaint in this proceeding upon respondents ~abraham 'Welkin and his wife, Minnie Welkin, individually, and trad- ' l~g as Princess Yarn C'lompany, charging them with unfair and decepe acts and practices in commerce in violation of the provisions of ea1d net. After the filing of respondents' answer to said complaint, ~he Commission on Jan nary 22, 1942, issued and subsequently served lts amended and suppiemental complaint upon said respondents, charging them with unfair and deceptive acts ..and practices in comtnerce within the intent rind meaning of the Federal Trade Commission .1\.ct.. Thereafter, testimony and other evidence in support of and in {)!>Position to the allegations of said amended and supplemental com- Plaint were introduced before an examiner of the Commission theretofore duly designated by' it, and said testimony and other evidence "-'ere duly recorded and filed in the office of the Commission. Thereafter,-the proceeding regularly came on for final hearing before the Commission on the said amended and supplemental complaint, testilllony and other evidence, report of t~e trial examiner, and brief in 376 FEDERAL TRADE COMMISSION. DECISIONS Findings 35F. T.Oi support of the complaint (respondents not having filed brief and o.ral argument not having been requested); and the Commission, haVlllg ·duly considered the matter and being now fully advised in the premise~, finds tllat 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 THE FACTS PARAGRAPH 1. Respondents, Abraham 'Velkin and his wife, Min~e 'Velkin, are individuals, trading as Princess Yarn Co., with thelr principal place of business located at 49 Essex Street, New York, N. "'{. PAR. 2. Respondents are now, anu for several years last past have been, engaged in the sale and distribution of various types and grades .of knitting yarns. Respondents cause their said products, when sold, to be trunsported from their place of business in the State of Ne.\\' York to purchasers thereof at their respective points of location _In various other States of the United States. Respondents maintalllt and have maintained, a source of trade in their said products in co(ll· merce between and among the various States of the United States. PAR. 3. In the course and conduct of their aforesaid business r~­ spondents have, by means of advertisements in magazines and in perl· odicals, secured_ inquiries concerning and requests for knitting yarns and have distributed to purchasers and prospective p1,1rchasers cata.· logues containing descriptions and samples of yarns offered for sa~e and sold by them. For the purpose of inducing the purchase of tbei~ said knitting yarns, respondents have engaged in the practice. 0 falsely representing the constituent fibers or materials of which their yarns are made, such false representations being made by meaJlS of statements and legends appearing in catalogues which they ha~e distributed among customers and prospective customers located ~n various States of the United States and on labels attached to their satd products. Among and typical of the false representations made bY 1 respondents in the aforesaid manner are the following: The use of the tenn "Cashmere Sport Yarn" to designate and de• scribe certain yarns which are not composed in whole or in part of the hair of the Cashmere goat. The term "cashmere" as applied to knitting yarns is understood by a substantial portion of the purchasing public to mean yarn made from the hair of the Cashmere goat. The use of the term "Sporting Angora" to designate and describe yarns which are not composed in whole or in part of hair of the Angort' goat, but which are in fact composed of approximately 25% rabbit hair and 75% wool. The word "angora" as applied to knitting yarns Pl-:U:NCESS YARN CO. 377 371 Findings is understood by a substantial portion of the purchasing public to '' mean yarn made from the hair of the Angora goat. ~he use of the term "Shetland Floss" to designate and describe yarns \\>hich are not composed in whole or in part of the wool of Shetland sheep raised on the Shetland Islands or the contiguous mainland of ~otland, but which are in fact made of domestic wool. The word . Shetland" as applied to knitting yarns is understood by the purchasing public to mean a particular type of wool derived from Shetland s8heepcotiand;raised. on the Shetland Islands · or the contiguous mainland of 'I'he use of the terms "Zephyr Tweed" and "De Luxe Tweed" to designate and describe certain of their yarns which are not composed ~ntirely of wool, but which in fact contain wool and rayon. The word tweed~' as applied to knitting yarns is understood by a substantial Portion of the purchasing public to mean yarn composed entirely of '\'Vool. .

PAn. 4. Various of the yarns sold and distributed by respondents !te falsely represented as being composed in whole or in part of silk. .the term "silk" is understood by a substantial portion of. the purchasing public to mean silk, the product of the cocoon of the silk- '\'Vorm. Among the yarns described by respondents as being silk or containing silk is me designated "Silk Flake" which is in fact com- Posed of cotton, rayon, and silk, and one described as "Silk '\Vool" "'which is in fact composed of approximately 50% wool and 50% rayon. ·.In addition to the false representations that certain yarns contain Silk, respondents further misrepresent such yarns and others, such ~s "Frosted Zephyr," "Pompadour," and "Zephyr Paradise," by fail- ~ng to disclose that they are composed in part of rayon. Rayon used ~n Yarn is a chemically manufactured fiber which can be so made as ? closely simulate silk or wool. '\Vhen manufactured to simulate :Ilk! it has the feel and appearnnee of silk; and when manufactured 0 sunulate wool, it has the feel and appearance of wool. By re·asfln Of these qualities rayon, wh~ manufactured to simulate silk or wool d not designated as rayon, is practically indistinguishable from :tlk or wool, as the case may be, and failure of respondents to ~disclose the rayon content of yarns containing that product has resulted in ·he Purchase of such yarns by a ::ubstantial portion of the purchasing fhUhlic under the erroneous impression that they were composed of e genuine product simulated.

lan. 5. Respondents have falsely represented the place of origin ohf certain of ~their products. Among such false representations is t e Use of the term "Scotch Tweed" to designate and describe a yarn Of domestic manufacture which is not composed of wool imported 378 FEDE,RAL TRAD.E COMMISSION DECISIONS Order 35F. 'f.O.

from Scotland, and also the use of the term "Saxony Zeph~r" .t~ , , designate and describe a yarn of domestic manufacture which IS no_ • composed of wool imported from the Province of Saxony. A sub stantial portion of the purchasing public understands :the ternt "Scotch Tweed" as applied to yarns to mean that the yarn or the wool from which it is made was imported from Scotland, and under· stands the term "Saxony Zephyr" as applied to yarns to mean that the yarn or the wool from which it is made was imported from the Province of Saxony. . . PAn. 6. Respondents have also misrepresented the nature of thell' business by using the words "Office and Factory at 49 Essex Street£ New York City," thereby representing that they are the owner~ 0 and conduct o. factory in which the yarns which they offer for so.le and sell are spun, and that they are the manufacturers of such yarn~ In fact respondents do not operate.or control, and have not· operate f or controlled a plant, factory, or machinery for the manufact~re 0 f the yarns sold by them, but, on the contrary, buy their· supplies 0 yarn from domestic manufacturers. A substantial portion of the purchasing public has a preference for buying merchandise, includ· ing the products sold by respondents, directly from the manufacturet' thereof, believing that by ,so doing certain advantages are obtained, such as securing a lower price through the elimination of middleinell' PAR. 7. The use by the respondents of the acts and practices ~et forth above has had, and now has, the tendency and capacity to lnts• lead and deceive a substantia] portion of the purchasing public into. the erroneous and mistaken). belief that said statements and representa· tions are true, and as a result of such erroneous and mistaken beliefs, members of the purchasing public have been induced to purchase, and have purchased, substantial quantities of respondents' products; CONCLUSION The aforesaid acts and practices of ,respondents are all to the prejudice and injury of the public and constitute unfair and decep· tive acts and practices in commerce within the intent and meaning of the Federal Trade Commission Act. '· ORDER TO CEASE AND DESIST This proceeding having. been heard by the Federal Trade Comni!s·' sion upon the amended and supplemental complaint of the Corn!1115", sion, testimony and other evidence in support of and in opposi~ioll, to the allegations of the complaint taken before an examiner of the. Commission theretofore duly designated by .it, report of the trial PRINCESS YARN CO. 379 371 Order examiner, and brief filed by couns~l. for the Commission, and the Commission having made its findings as to the facts and its con- ~~usion tl{at said respondents have violated the p,provisions of the 'ederal Trade Commission Act.

' It ~8 ordered, That re:::pondcnts, Abraham 'Welkin and Minnie V'elkm, individually, and trading as Princess Yarn Co. or under nny 'other name, jointly or severally, their representatives, agents, or ' ('Jl)r.} . h d . . LJ oyees, dtrectly or through any corporate or ot er evlCe, m ·connection with the offe~·ing for sale, sale, or distribution of knitting ~arns in comme!ce, as "commerce" is defined in the Federal Trade omrnission Act, do forthwith cease and desist from: 11. 'Using the word "Cashmere," or any simulation thereof, either ~oone ?r in connec~ion or conjunction with any ot~er .word or words, :les1gnate, clescnbe, or refer to. any product which IS not composed ~~tlr~ly of hair of the Cashmere goat: Provided, however, That in e case of a product composed in part of hair of the Cashmere goat ~nd in part of other fibers or materials, such word may be used as escriptive of the cashmere fiber content if there are used in imllled~ate connection or conjunction therewith, in letters of at least ec\ua} size and conspicuous11ess, words truthfully describing such ot ler constituent fibers or materials. · nl 2· Usi~g the wo.rd "Ango:a," ?r an.y simulation thereof, either ,· one or m connectwn or coiiJunchon with any other word or words, ' 1~! 0 ~designate, describe, or refer to any product whch is not composeu ~entire}y of hair of the Angora goat: Provided, however, That in the ~nsa of a product compo!'ied in part of hair of the Angora goat and t~ Part of other fibers or materials, such word may be used as descrip- ~ve of the angora fiber content if there are used in immediate con· e ection or conjunction therewith, in letters. of at least equal size and fi~spicuousness, words truthfully describing such other constituent rs or materials.

ala. Using the word "Shetland," or any simulation thereof, either tone or in connection or conjunction with any other words or words, e~ ~designate, describe, or refer to any product which is not composed th tlrely of wool of Shetland sheep raised on the Shetland Islands or e e contiguous mainland of Sc.otland: Provided, however, That in the 'Pnse of a product composed in part of wool of Shetland sheep and in· 0;rt of other fibers or materials, such word may be used as descriptive t' the Shetland wool content if there are used in immediate connec- /011 or conjunction therewith, in letters of at least equal size and tl~nspicuousness, words truthfully describing such other constituent ers or materials.

380 FEDERAL TRADE COl\IMISSlON DECISIONS Order 35F.'f.C- 4. Using the word "Tweed," or any simulation thereof, either alone or in connection or conjunction with any other word or words, t~ designate, describe, or refer to any product whi~h is not compose entirely of wool: Provided, however, That in the case of a product composed in part of wool and in part of other fibers or materials, such word may be used as descriptive of the wool content if there are used in immediate connection or conjunction therewith, in I~t~ers of at least equal size and conspicuousness, words truthfully descr1bi1Jg ' such other constituent fibers or materials.

5. Using the word "Scotch," or any simufation thereof, either alone or in cbnnection or conjunction with any other word or words, to designate, describe, or refer to any product not imported from Scot· land or made of materials imported from Scotland: Provided, h~1JJ­ ever, That in the case of a produc:t composed in part of wool 1~­ ported from Scotland and in part of other· fibers or materials, suct~ , word may be used as descriptive of the content imported from Sco land if there are. used in immediate connection or conjunction there· with, in letters of at least equal size and conspicuousness, words truth· fully describing such other constituent fibers or materials. 6. Using the word "Saxony," or any simulation thereof, ei~h~r alone or in connection or conjunction with any other word or wor s to designate, describe, or refer to any product not imported from1l the Province of Saxony or made of materials imported from th~ Province of Saxony: Provided, lwl.NYVer, That in the case of a prod tic composed in part of wool imported from Saxony and in part of other 'fibers or materials, such word may be used as descriptive of the co~­ tent imported from the Province of Saxony if there are used 1~ immediate connection or conjunction therewith, in letters of at len~ • equal size and· conspicuousness, words truthfully describing snc other constituent fibers or materials. · 7. Using the word "Silk," or any simulation thereof, either alone or m· connectwn· or conJunctwn· · wit· h any ot h er wor d or wor ds ' tod des~gnate, d?scribe, or refer to any product whi~h is not co:rnp~£ed rnt1rely of silk, the product of the cocoon of the silkworm; Prot•·lde ' however, That in the case of material composed in part of silk, the product of the cocoon of the silkworm and in part of other fibers,0( ·materials, such word may be used as descriptive of the content whlC ~ is. silk, the product of the cocoon of the silkworm, if there are use t in immediate connection or conjunction therewith, in letters of 11 11 least equal size and conspicuousness, words truthfully describing sue other constituent fibers or materials. . 8. Advertising, offering for sale, or selling, products composed Jll whole or in part of rayon without clearly disclosing such rayon cow PRINCESS YAR~ CO. 381.

Order"

tent; and when products are composed in part of rayon and in part of other fibers or materials, all such fibers or materials, including the r~Y~n, shall be clearly and accurately disclosed . . 9, Represer{ting or implying by the use of the word "Factory," or' ln any Inanner >whatsoever, that respondents own, control, or operate a factory in which the yarns they offer for sale or sell are made, or representing or implying in any manner that yarns or other products 1 . not manufactured by respondents are manufactured by them. 1 th t iB further ordered, That respondents shall, within 60 days after . e service upon them of this order, file with the Commission a report ~n Writing setting forth in detail the manner and form in which they' o:ve complied with this order.

d 1.t i8 further ordered, That no provision of this order to cease and t'hSlst shall be construed as relieving respondents in any respect of u e necessity of complying with the requirements of the Wool Prodthts Labeling Act of 1939 and the rules and regulations promulgated ereunder.

· .. .. · l!OilHU••-43....:.voi. 815-· 21 Syllabus 35F.T.C·