Isidore Lusterman and Edward E. Seldis, Copartners trading as Lusterman, Seldis Company

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In Tue Marrer or ISIDORE LUSTERMAN AND EDWARD E. SELDIS, CO- PARTNERS TRADING AS LUSTERMAN, SELDIS COM- PANY COMPLAINT, FINDINGS, AND ORDER IN REGARD TO THE ALLEGED: VIOLATION. OF SECTION 5 OF AN ACT OF CONGRESS APPROVED SEPTEMBER 26, 1914 Docket 5443. Complaint, June 14, 1946—Decision, Aug. 20, 1947 Where two partners engaged in the interstate sale and distribution of umbrellas,. including some the covers of which were composed in whole or in part of rayon and simulated in texture and appearance products composed wholly or in part of silk— Offered and sold said products without disclosing that they were composed wholly or in part of said chemically manufactured fiber; With result that many members of the purchasing public were thereby lead tobelieve that such products were composed of silk or other natural fibers, and. of placing in the hands of purchasers for resale a means whereby they might and did mislead and deceive the purchasing public as to the actual fiber content thereof; whereby substantial quantities. thereof were purchased as. and for products made wholly or chiefly of silk or other natural fibers: Held, That such acts, practices and methods, under the circumstances set forth,,. were all to the prejudice and injury of the public and constituted unfair and deceptive acts and practices in commerce. Mr, Dewitt T. Puckett for the Commission.

Laxer, Shapiro & Lauter, of New York City, for respondents. 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 reason to believe that Isidore Lusterman. and Edward KE. Seldis, individually and -as.copartners trading as. Lusterman, Seldis Co., hereinafter referred to as respondents, have 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:

Paracrary 1. The respondents Isidore Lusterman and Edward E. Seldis are copartners trading and doing business as Lusterman, Seldis Co. and have their principal office and place of business at 5 West Thirty-sixth Street, New York, N. Y. Respondents are now and for LUSTERMAN, SELDIS CO. 107 106 Complaint more than 1 year last past have been engaged in the sale and distribution of umbrellas.

Respondents cause their said products when sold, or to be sold, to be transported from their said place of business in the State of New Yorkto the purchasers thereof located in various other States of the United States and in the District of Columbia. Respondents maintain and have maintained a course of trade in their said products in commerce among and between the various States of the United States and in the District of Columbia.

Par. 2. Among the products offered for sale and sold by the respondents in commerce as aforesaid are some which are composed wholly or in part of rayon.

Par. 3. Rayon is a chemically manufactured fiber which may be manufactured so as to simulate natural fibers in texture and appearance, and fabrics manufactured from such rayon fibers simulate natural-fiber fabrics in texture and appearance. Products manufactured from such rayon fabrics may have the appearance and feel of naturalfiber products, and many members of the purchasing public are unable to distinguish between such rayon products and products manufactured from natural fibers; consequently, such rayon products are readily accepted by some members of the purchasing public as natural-fiber products.

' Par. 4. Some of the products sold by respondents in commerce, as aforesaid, simulate in texture and appearance products composed wholly or in part of silk. Respondents do not inform the purchasers of their said products or the purchasing public of the fact that the products which resemble silk in texture and appearance are made wholly or in part of rayon and not of silk or other natural fibers. Par. 5. The practice of the said respondents in offering for sale and selling said products manufactured wholly or in part of rayon which resemble in texture and appearance products manufactured from silk or other natural fibers, in commerce as aforesaid, without disclosing, in words familiar to the purchasing public, the fact that said products are composed wholly or in part of rayon is misleading and deceptive and many members of the purchasing public are thereby led to believe that said products are composed wholly or in part of silk or other natural fibers.

Par. 6. The use by the respondents of the acts and practices hereinabove described has the capacity and tendency to mislead and deceive purchasers of respondents’ said products as to the true fiber content thereof. By said acts and practices respondents also place in the hands of the purchasers of their said products for resale to the pur- Findings 44¥F. T.C. chasing public a means and instrumentality whereby they may and do mislead and deceive the purchasing public as to the actual fiber content of said products. As a result of the aforesaid deception substantial quantities of respondents’ said products are purchased in the belief that they are made wholly or chiefly of silk or other natural fibers. Par. 7. The aforesaid acts, practices and methods of respondents, as herein alleged, are all to the prejudice and injury of the public and constitute unfair and deceptive acts and practices in commerce within. the intent and meaning of the Federal Trade Commission Act. Report, Finpines As TO THE Facts, AND ORDER Pursuant to the provisions of the Federal Trade Commission Act, the Federal Trade Commission on June 14, 1946, issued and subsequently served its complaint in this proceeding upon respondents Isidore Lusterman and Edward E. Seldis, individually and as copartners trading as Lusterman, Seldis Co., charging them with the use of unfair and deceptive acts and practices in commerce in violation of the provisions of said act. On August 20, 1946, the respondents filed their answer, in which they admitted all the material allegations of fact set forth in said complaint and waived all intervening procedure and further hearing as to said facts. Thereafter, this proceeding regularly came on for final hearing before the Commission on the said complaint and the answer thereto; and the Commission, having duly considered the matter and being now fully advised 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 conclusion drawn therefrom. FINDINGS AS TO THE FACTS Paracrapy 1. The respondents, Isidore Lusterman and Edward E. Seldis, are copartners trading and doing business as Lusterman, Seldis Co., with their principal office and place of business at 5 West Thirtysixth Street, New York, N. Y. Respondents are now, and for more than 1 year last past have been, engaged in the sale and distribution: of umbrellas.

Par. 2. Respondents cause their said products, when sold or to be sold, to be transported from their said place of business in the State of New York to the purchasers thereof located in various other States. of the United States and in the District of Columbia, and maintain, and have maintained, a course of trade in their said products in commerce among and between the various States of the United States: and in the District of Columbia.

LUSTERMAN, SELDIS CO. 109: 106 Conclusion Par. 3. Among the products offered for sale and sold by the respondents in commerce, as aforesaid, are some which are composed wholly orin part of rayon. Rayon is a chemically manufactured fiber which may be manufactured so as to simulate natural fibers in texture and appearance, and fabrics manufactured from such rayon fibers simulate natural-fiber fabrics in texture and appearance. Products manufactured from such rayon fabrics may have the appearance and feel of natural-fiber products, and many members of the purchasing public are unable to distinguish between such rayon products and products. manufactured from natural fibers; consequently, such rayon products are readily accepted by some members of the purchasing public as natural-fiber products.

Par. 4. Some of the products sold by respondents in commerce, as. aforesaid, simulate in texture and appearance products composed. wholly or in part of silk. Respondents do not inform the purchasers. of their said products, or the purchasing public, of the fact that the products which resemble silk in texture and appearance are made wholly or in part of rayon and not of silk or other natural fibers. Par. 5. The practice of the said respondents in offering for sale and. selling, in commerce as aforesaid, said products manufactured wholly or in part of rayon which resemble in texture and appearance products. manufactured from silk or other natural fibers without disclosing, in words familiar to the purchasing public, the fact that said products. are composed wholly or in part of rayon, is misleading and deceptive, and many members of the purchasing public are thereby led to believe: that said products are composed wholly or in part of silk or other natural fibers.

Par. 6. The use by the respondents of the acts and practices herein-. above described has the capacity and tendency to mislead and deceive: purchasers of respondents’ said products as to the true fiber content thereof. By said acts and practices respondents also place in the hands. of the purchasers of their said products for resale to the purchasing public a means and instrumentality whereby they may, and do, mislead and deceive the purchasing public as to the actual fiber content of said products. Asa result of the aforesaid deception, substantial quantities of respondents’ said products are purchased in the belief that they are made wholly or chiefly of silk or other natural fibers. CONCLUSION The aforesaid acts, practices, and methods of respondents, as herein found, are all to the prejudice and injury of the public and constitute Order 44¥F. 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 Federal Trade Commission upon the complaint of the Commission and the answer of respondents, in which answer respondents admitted all the material allegations of fact set forth in said complaint and waived 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 respondents have violated the provisions of the Federal Trade Commission Act:

It is ordered, That the respondents, Isidore Lusterman and Edward E. Seldis, individually and as copartners trading as Lusterman, Seldis Co., or under any other name, their «respective representatives, agents, or employees, directly or through any corporate or other device, do forthwith cease and desist from: Selling or distributing in commerce, as “commerce” is defined in the Federal Trade Commission Act, any umbrellas or other articles made in whole or in substantial part of a fabric composed of rayon, without clearly and conspicuously disclosing such rayon content in all invoices and by means of labels, tags, or other markings securely affixed to such article; and when such fabric is composed in part of rayon and in part of other fibers or materials, all such fibers or materials including the rayon, shall be disclosed in the manner and by the means set forth above.

It is further ordered, That respondents shall, within 60 days after the service upon them of this order, file with the Commission a report in writing setting forth in detail the manner and form in which they have complied with this order.

THE SPARTAN CO. ET AL. a Syllabus