Banner Manufacturing Co.

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

IN THE l\{ATTER OF BANNER MANUFACTURING CO.

ORDER MODIFYING ORDER TO CEASE AND DESIST ISSUED JAN. 31, 1!l38 1 Docket 3061. Order, J1tlV 13, 1949 ()rde-r modifying prior cease and desist order in proceeding in question, 26 F. T. C. 614, so as to eliminate from paragraph 1 of said order, for the reasons below set forth, proviso permitting, subject to the conditions therein stated, the representation by respondent, otherwise prohibited, that its anitfreeze preparations are safe and harmless for general use in automobile radiators. Before Mr. Webste1· Ballvnger, trial examiner. Mr. Jesse D. Kash for the Commission.

Mr. Jacob E. Hurwitz, of New York City, for respondent. ORDER MODIFY1 NG ORDER TO CEASE AND DESIST ISSUED JANUARY 31, 19 3 8 This cause coming on to be heard by the Commission upon motion of Richard P. 'Vhiteley, assistant chief counsel, to amend order to ·cease and desist issued in this proceeding on January 31, 1938; respondent's statement in opposition to said motion; testimony and other evidence on the question of public interest taken before 'Vebster Ballinger, a trial examiner of the Commission; recommended decision 1 Said cease and desist order rf'uds as follows: "'this proceeding having been heard by the Federal Trade Commission upon the amended -complaint of the Commission and the answer thereto filed herein on December 28, 1937, by respondent admitting all the material allegations of the amendeu complaint to be true and waiving the taking of further evidence and all other intervening procedure, and the Commission having made its findings as to the facts and its conclusion that said respondent has violated the provisions of an act of Congress approved September 26, 1914, entitled 'An act to create a Federal Trade Commission, to define its powers and duties, and for other purposes' ;

"It is ordered, That the respondent, Banner Manufacturing Co., a corporation, its officers, representatives, agents, and employees, in connection with the offering for sale, sale, and distribution of antifreeze preparations for use in automobile radiators in interstate commerce or in the District of Columbia, do forthwith cease and desist from: "(1) Representing that said preparations are safe and harmless solutions for general use in automobile radiators: P1·ovided, howeve1·, Respondent is not prohibited from representing that said products, as now composed, when used under the suggested directions of respondent as to proper quantities thereof for designated temperatures, are effective as antifreeze solutions.

"(2) Representing, through the use of the word 'manufacturing' or any other word or term of similar import and meaning in its corporate name,. or. in any other manner, or through any means or device, that it is the manufacturer of said antifreeze preparations or that saiu preparations are made in its laboratories under its strict supervision unless and until it actually owns and operates or directly and absolutely controls a factory or manufacturing plant wherein such preparations are made by it under such supervision. "It is fu.rthe1' 01'dered_. That the respondent shall, within 60 days after service upon it of this order, til~ with the Commission a report in writing setting forth in detail the manner and form in which it has complied with this order." Order 46 F. T. C.

of said trial examiner filed !1areh 2, 1948 ; exceptions to said recommended decision filed by the respondent, and brief of counsel in support of motion to amend order to cease and desist; and It appearing to the Commission that it is the public understanding that an effective antifreeze is a preparation which prevents freezing in the radiators and motors of automobiles and is such a substance which will not cause damage to radiators, engines, motors, or other parts of automobiles when used; and It further appearing that the representation that respondent's products, when used under the suggested directions of the respondent as to proper quantities thereof for· designated temperatures, are "effeetive as antifree-ze solutions" conveys the meaning to the public. that said products are safe and harmless solutions for general use in automobile radiators; and It further appearing that the respondent, by its answer i11 this proceeding, admitted that its preparations a.re not safe antifree.ze preparations for general use from the standpoint of corrosion, as they will cause corrosion in the cooling system in which they are continually used which will in many instances lessen the effectiveness of the cooling system and cause the engine to overheat and cause corrosion on spark plugs, ignition wires, and other metal parts of the automobile with which such products come in contact, in many instances causing shorts in the ignition system; and The Commission being of the opinion that the proviso contained in paragraph 1 of the order is contrary to fact and contrary to the admissions in the pleadings, and the Commission being further of the opinion that the public interest requires that the order to cease and desist be modified to conform with the facts and the record herein:

It i.s ordered, That the order to cease and desist heretofore issued on January 31, 1938, be, and the same hereby is, modified by striking from paragraph 1 thereof the following proviso: "Provided, however, Respondent is not prohibited from representing that said products, as now composed, when used under the suggested directions of respondent as to proper quantities thereof :for designated temperatures, are effective as antifreeze solutions."

BANNER MANUFACTURING CO., INC~, ET AL. 49 Syllabus