Hecht Co., Etc

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IN THE MATTER OF HECHT CO.MPANY .ALSO TRADING AS HECHT BROS. COMPLAINT, FDIDIXGS, AND ORDER I:>< REGARD TO THE .\ALLEGED VIOLATION Ol•' SEC. 1'1 OF AN ACT OF CONGRES~ APPROVED SJ<:PT. 20, 1914 Docket 48-~0. Complaint, Sept. 28, 1942-Dcciaion, May 25, 1943 \Vhere a corporation engaged In the operation of department stores hi. Baltimore, \Vashlngton, and New York, and In Interstate sale nnd distribution, among other things, of mattresses- Falsely rept·esented through statements in periodicals, cntalo,;s, circulars, lists and other advertising material, that its $19.75 price tor mattressl's was much less than the usual price therefor and wns a spPcinl price, 111lording the purchaser a substantial saving over the customary one; when In tuct stwh was its usual selling price;

With effect ot misleading and deceiving a substantial portion ot the purchasing ·public Into the erroneous belief that such representations were true, and of Inducing It to purchase Its said products:

lleld, That said acts and practices, under the circumstances set forth, wet·e ail to thl' pt·ejudice and injury of the publlc, and constituted unf11lr anti dt>eeptlve acts und practices In commerce.

ltf r. J. lV. Brookfield, Jr. for the Commission. Lauchheimer (6 Franlk, of Baltimore, Md., for respondent. Complaint Pursuant to the provisions of the Federal Trade Commission Act and by virtue of the authority vested in it by said act, the Federal Trade Commission, having ronson to believe that the Hecht Co., a corporation, also trading as Hecht llros., hereinafter referred to as respondent, has violated the provisions of said act, and it appearing to the Commission that a proceeding by it in respect thereof would be in the public interest, hereby issues its complaint stating its charges in that respect as follows:

P .anAGRAPII 1. ReRpondrnt, Hecht Co., is a corporation, organized, existing and doing business under a nil by virtue of the laws of the State of 1\Iaryland with its principal office and place of business located in the city of BnltimorP, State of :Maryland. It also trades l\5 nnd uses the name of Hecht llros. Responllent is now and for soJJ1e time last past has been Pn~ngrd in the business of selling and dis· tributing- mattrcssPs and other-r merchandi::;e in comme-rce between and among- the Yariom Stat<•s of the United Statps and in the District of Columbia. HPspondent maintains and opl'l"ates department stores in the cities of Baltimm·p, l\Id., """ashington, D. C., and New York, N. "f. RE-sponde-nt causes its nwrchanrlisc when sold to be shipped from its HEICHT CO., ETC. 831 830 Complaint place of business in the States of Maryland and New York and in the District of Columbia to purchasers thereof located in various other States of the United States and the District of Columbia. Respondent maintains and at all itmes mentioned herein has maintained a course of trade in said merchandise in commerce between and among the various States of the United States and in the District of Columbia. In the course and conduct of its said business respondent is now and has been for some time last past in competition with other corporations and with individuals and firms engaged in the sale and distribution of similar merchandise in commerce between and among the Various States of the United States and in the District of Columbia. PAn. 2. To induce the purchase of its said mattresses, respondent has disseminated and is now disseminating false and misleading statel11ents and representations with respect to said products and the purchase price thereof. Such statements and representations are inserted in periodicals having a general circulation and in catltlogs, circulars, lists, and other advertising material which are distributed among Prospective customers. Among and typical,l of such false and misleading representations are the following:

Actually One-Half Price "Paisley Quilted" $39.50 Inner-spring Mattress $19.75. Only becnnse of our tar-sighted planning is it possible tor us to offer tllis QUILTED mattress to you at HALF price.

$3!>.50 Inner-spring Mattress actually one-halt price, $19.75. PAn. 3. Dy the use of the foregoing statements, together with other statements similar thereto, not specifically set out herein, the respondent represents that the $19.75 prices for its mattresses are much less than the customary and usual prices at which such mattresses are sold and nre special prices and that in purchasing said mattresses at the advertised price, a substantial saving, over the usual and customary price, is afforded a purchaser.

PAn. 4. The foregoing representations are false, misleading, and deceptive. In truth and in fact prices at which respondent's mattresses are advertised for sale are not in fact reduced or half prices and do not represent any substantial saving to the purchaser but are substantially the same prices at which said mattresses are usually sold by respondent and by others selling similar mattresses.

PAn. 5. The use by respondent of the aforesaid false and misleading statements and repl'('sentations referred to herein has had and now has the tendency and capacity to and does mislead and deceive a subf>tantial portion of the purchasing public into the erroneous and mistaken belief that such statements and representations are true aud because of such erroneous and mistaken belief a substantial portion of the purchasing public is induced to and does purchase respondent's Said products.

832 'FEDErRAL TRADE Commissiion D'ECISIONS Findings 36 F. T. C. PAR. 6. The aforesaid acts and practices of the respondent, as herein set forth, are all to the prejudice and injury of the public and consti· tute unfair and deceptive nets and practices in commerce within the intent and me:ming of the Federal Trade Commission Act. REPORT, FINDINGS AS TO Tile FACTS, AND ORDER Pursuant to the provisions of the Federal Trade Commission Act, the Federal Trade Commission on September 28, 1942, issued and subsequently served its complaint in this proceeding upon the re· spondent, Hecht Co., a corporation, also trading as Hecht Bros., charging it with the use of unfair and deceptive acts and practices in commerce in violation of the provisions of that act. On October 15, 1942, the responucnt 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 re· spondcnt and Richard P. Whiteley, assistant chief counsel for the Federal Trade Commission, subject to the approval of the Commis· sion, might be taken as the iacts in this proceeding anu in lieu of testimony in support of the charges stated in the complaint or in opposition then'to, and that the Commission might proceeu upon saiu st!ltcmcnt of facts to make its report, stating its findings ns to the iacts and its conclusion Lased thereon, and enter its order disposing of the proceeding without the presentation of argument or the filing of l1ricfs. Thereafter, this proceeding regularly ca111e on for final hearing before the Commission on the complaint, nn· swer, and stipulation (said stipulation having been approved, nc· cepted and filed) and the Commission, having duly considered t~e matter and being now iully advised in the premises, finds that tllis proceeding is in the interest of the public and makes this its findings ns to the facts and its· conclusion drawn therefrom. FINDINGS AS TO THE FACTS PAnAORAPII 1. The respondent, Hecht Co., is a corporation, organ· ized, existing, and doing business under and by virtue of the 1:1":5 of the State of :Marylanu, with its principal office and place of Lull' ness located in the city of llaltimore, State of Maryland. It also trn1les as nnd 1~scs the n:tme of Hecht llros. R~spondent .is ~o«; and for some hme last past, has L n l·ngag<>,] m tlte lm~we:->:. 0 s<>lling anu distributing mattress<>s nnu other merchanuisc in coiil' merce between and nmong the 'Various States of tho United States and in tT10 District of Columbia. Respondent maintains nnu operates department stores in the citi<'s of ll:lltimorP, ~Id., "~ashingt 0!1' HE'CHT CO., ETC. 833 830 Conclusion D. C., and New York, N. Y. Respondent causes its merchandise, when sold, to he shippad from its places of business in the States of Maryland and New York and in the District of Columbia to Purchasers thereof located in various other States of the United States and the District of Columbia. Respondent maintains, and ~t all times mentioned herein has maintained, a course of trade In said merchandise in commerce between and among the various States of the United States and in the District of Columbia. PAn. 2. To induce the purchase of its said mattresses, respondent has disseminated statements and representations with respect to said Products and the purchase price thereof. Such statements and representations were inserted in periodicals having a general circulation, and in catalogs, circulars, lists, and other advertising material which were distributed among prospective customers. Among and typical of such representations are the following:

ActunUy One-Halt Price "Paislry Quilted" $3D.::i0 Inner-spring .Mattress $19.i;), Q~nly hecause or our tar-sighted planning is it possible tor us to offer this LTED mattress to you at IIALli' price.

$3D.!JQ Innet·-sprlng Mnttre8s actually one-half price, $19.75. PAn. 3. Dy the usc of the foregoing statements, together with other ~tatements similar thereto not specifically set out herein, the respondent representeu that the $HJ.75 price for its mattresses was ~Uch less than the customary and usual price at which such matrhess.es were solu by it and was a special price, and that in pure US! n rr '.1 • b ' l . o Salu mattress<'s at the advertised price, a su stantla savmg overp the usual 1 and customary pnce· was afforue-1 d· t I1e pure h aser. .A.It, 4. In truth and in fact the price at which respondent's said1 rnnttresses were advertised fo; sale was not half price and did not s?re.sent any such substantial saving to the purchaser, but was suba}~llhally the same price at which said mattresses were and are usu- ~ sold by respondent.

r <~.a. 5. The use by respondent of the aforesaid statements and a~~resent.ations had the tendency nnd capacity to and d~d _mislead err decen·e a sub~tantial portion of the purchasing pubhc mto the ti Olleous and mistaken belief that such statements and representaons w 1 · k b l' fa . b <'re tru<', and, l•ccause of such erroneous an( nusta en e 1e , <li~u stantiul portion of the purchasing public was induced to and Purcha>;e respontlent's said mattresses.

CO!\CLL'SION 1'he af · I · f dare oresa1J acts und practicrs of the respondent as 1erem oun all to the preju 1lice and injury of the public, and constitute COMMISSiiO~ D'ECISIONS834 F'EDEIRAL TRADE Oruer 36F.T.C.

unfair and deceptive 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 Ft'deral Trade Commission upon the complaint of the Commi~sion, the answer of respondent, and a stipulation as to the facts entered into between the respondent and Richard P. Whiteley, assistant chief counsel for the Commission, which provided among other things that, without further evidence or other intervening procedure, the Commission might issue and serve upon the re~pondent findings as to the facts uud conclusion based thereon, and an order disposing of the proceeding; and the Commission having made its findings as to the facts and its conclusion that said respondent has violated the provisions of the Federal Trade Commission Act.

It is ordered, That the respon\lent, Ilc<·ht Co., a corporation, also trading as Hecht Dros., or trading undH any other name, and its officers, representatives, ngPnts, and t'mployees, directly or through any corporate or other device, in connection with the offering for sale, sale and distribution of mattresses in commerce, as "commerce" is defined in the Fetlcrnl Trade Commission Act, do forthwith cease and desist from:

1. Representing as the customary or regular price of respondent's mattresses any price which is in excess of the price at which such mattresses have been regularly sold by respondent in the usual course of business.

2. Representing that the price at which respondent's mattresses are offered for sale constitutes n. special or reduced price or half price, when in fact such price is the usual or customary price at which such mattresses are offered for sale by respondent in the usual course of business.

It is further ordered, That the respondent shall, within CO days 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.

CO'NWAY TAILORS 835 Complaint