Marine Products Co

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

IN THE ~ATTER OF ~ARINE PRODUCTS COMPANY COMPLAINT, FINDINGS, AND ORDER IN REGARD TO THE ALLEGED VIOLATION OF SEC. 2 (c) OF AN ACT OF CONGRESS APPROVED OCT. 15, 1914, AS AMENDED BY ACT APPROVED JUNE 19, 1936 Docket 5197. Complaint, Mar. 14, 1944-Decision, Mar. 29, 1945 Where a corporation engaged in the interstate sale and distribution of canned tuna, abalone and skip jack- Paid and granted to buyers, some of whom incorrectly designated themselves as brokers, commissions or brokerage or compensation, allowances, or discounts in lieu thereof on purchases of its products made by such buyers on their own behalf and for their own accounts, including purchases bearing its brands and labels and purchases bearing the private brands or labels of the buyers: Held, That said acts and practices in paying and granting such commissions or brokerage to purchasers of its products constituted violation of subsec. (c) of Sec. 2 of the Clayton Act as amended.

Mr. Edwards. Ragsdale for the Commission.

Mr. Benjamin W. Shipman, of Los Angeles, Calif., and Mr. Fulton Brylawski, of Washington, D. C., 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, 1'936, has violated and is now violating the provisions of subsection (c) of section 2 of the Clayton Act (U.S.C. Title 15, Sec. 13) as amended by the Robinson-Patman Act, approved June 19, 1936, hereby issues its complaint, stating its charges with respect thereto as follows:

PARAGRAPH 1. Respondent, ~arine Products Company, is a corporation, organized and existing under the laws of the State of California, with its principal office and place of business. located at 3370 Harasthy Street, San Diego, Calif.

PAR. 2. Respondent, ~arine Products Company, is now engaged and for many years prior hereto, has engaged in the business of distributing and selling canned tuna, canned abalone, and canned skip jack and other sea food products (all of which are hereinafter called sea food products) in its own name and for its own account.

The respondent sells and distributes its sea food products through two separate and distinct methods. First, through intermediaries who act as its agents in negotiating the sale of its sea food products and for which services such intermediaries customarily are paid, directly or indirectly, commissions or brokerage fees. Second, through the sale of its sea food products directly to buyers who are paid, directly or indirectly, commission or brokerage fees on their own purchases of such sea food products. The respondent, to distinguish its sea food products from the sea food products sold by competitors and to facilitate sales, utilizes registered and unregistered trade-marks and brands for various sea food products it sells, which brands are generally known as packers' or sellers' brands. MARINE PRODUCTS CO. 315 314 Findings The respondent also sells its sea food products unlabeled or unbranded, and also under the labels or brands of its buyers, which brands or labels are generally known to the trade as private or buyers' brands. Some of such buyers who incorrectly designate themselves as brokers also utilize registered and unregistered labels and brands, which labels and brands are utilized in selling such respective buyers' merchandise. Such buyers are primarily engaged in the purchase and sale of sea food products in their own name and for their own account.

PAR. 3. The respondent in the course and conduct of its said business, since June 19, 1936, has sold and distributed a substantial portion of its ~ea food products directly to buyers located in States other than the State m which the respondent is established, and as a result of said sales and the respondent's instructions, such sea food products are shipped and transported across State lines to such buyers who are located in various States of the United States .

. PAR. 4. The respondent, since June 19, 1936, in connection with the Interstate sale and distribution of sea food products in its own name and for its own account for resale, has sold such sea food products to buyers located in the various States of the United States other than the State :-vhere respondent is established, and has been and is now paying or grant- Ing or has paid or granted, directly or indirectly, commissions, brokerage or other compensation or allowances or discounts in lieu thereof to buyers of said sea food products sold under its own labels, unlabeled and under buyers' labels.

PAR. 5. The paying and granting by respondent, directly or indirectly, of commissions, brokerage or other compensation and allowances of discounts in lieu thereof to the buyers of said sea food products, on their own purchases which are resold unlabeled or under either the buyers' or sellers' labels, and the acts and practices of the respondent in promoting sales of sea food products by paying to buyers, directly or indirectly, commissions, brokerage or other compensation and allowances or discounts in lieu thereof, as set forth above, 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 tt 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 approved June 19, 1936, (the Robinson- Patman Act-U. S. C. Title 14, Sec. 13) the Federal Trade Commission on March 14, 1944, issued and subsequently served its complaint in this Proceeding upon Marine Products Company, a corporation, charging it with violation of the provisions of subsection (c) of section 2 of said Clayton Act as amended. After the issuance of said complaint, the respondent filed its answer, which answer admitted all the material allegations of fact set forth in said complaint and waived all intervening procedure and further hearing as to said facts. In said answer respondent stated that the Practices complained of had been discontinued. Thereafter, this pro. ceeding regularly came on for final hearing before the Commission on said complaint and answer; and the Commission, having duly considered the same and being now fully advised in the premises, makes this its finding!'! M to the facts and its conclusion drawn therefrom, Order 40 F. T. C.

FINDINGS AS TO THE FACTS PARAGRAPH 1. Respondent, Marine Products Company, is a corpora~ tion, organized and existing under the laws of the State of California, with its principal office and place of business located at 3370 Harasthy Street. San Diego, Calif. The respondent is now, and for many years last past has been, engaged in the sale and distribution of canned tuna, canned aba~ lone, and canned skip jack (hereinafter frequently referred to as sea~food products). Respondent sells its sea-food products under its own trade marks and brands and also, by agreement with some buyers, places the private brands or labels of such buyers on the sea-food products purcha-;;ed by them.

PAR. 2. In the course and conduct of its aforesaid business, pursuant to sales made, respondent transports, or causes its products to be trans~ ported, from its place of business to various purchasers at their respective points of location in States other than the State in which such shipments originated. Respondent thus maintains, and has maintained, a course of trade in said products in commerce, as" commerce" is defined in the afore~ said Clayton Act as amended.

PAR. 3. Since July 19, 1936, respondent has, in or in connection with sales of its sea-food products in commerce as aforesaid, paid and granted to buyers, some of whom incorrectly designate themselves as brokers, com~ missions or brokerage or compensation, allowances, or discounts in lieu thereof on purchases of its products made by such buyers on their own behalf and for their own accounts. Such brokerage payments, or discounts in lieu thereof, have been made to buyers upon their own purchases of products bearing respondent's brands and labels as well as upon purchases of respondent's products under the private brands or labels of the buyers. CONCLUSION The aforesaid acts and practices of the respondent in paying and grant~ ing commissions or brokerage or compensation, allowances, or discounts in lieu thereof to purchasers of its products constitute violations of sub~ section (c) of section 2 of the Clayton Act as amended. ORDER TO CEASE AND DESIST This proceeding having been heard by the Federal Trade Commission upon the complaint of the Commission and the answer of thp. respondent, which answer admits all of the material allegations of fact set forth in said complaint and waives all intervening procedure and further hearing as to said facts, and the Commission having made its findings as to the facts and its conclusion that said respondent has violated the provisions of sub~ section (c) of section 2 of an act of Congress entitled "An act to supple~ ment 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 approved June 19, 1936, (the Robinson~Patman Act-U. S. C. Title 15, Sec. 13). . It is ordered, That respondent, Marine Products Company, a corpora~ tion, its officers, agents, representatives, and employees, directly or through any corporate or other device, in or in connection with the sale an::l distri~ bution of RPa-food products or other commodities in commerce, as MARINE PRODUCTS CO. 317 314 Order "commerce" is defined in the aforesaid Clayton Act as amended, do forthwith cease and desist from:

Paying or granting, directly or indirectly, anything of value as a commission or brokerage, or any compensation, allowance, or discount in lieu . thereof, to any purchaser upon purchases for his own account, or to any agent, representative, or other intermediary acting in fact for or in behalf of or subject to the direct or indirect control of the purchaser to whom sale is made.

It is further ordered, That the respondent shall, within 60 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.

Order 40 F. T. C.