Morris Shapiro

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In THE Matter oF MORRIS SHAPIRO, CHARLES SHAPIRO, AND MARY SHA- PIRO TRADING AS U-C-A MANUFACTURING CO.

COMPLAINT, FINDINGS, AND ORDER IN REGARD TO THE ALLEGED VIOLATION OF SEC. 5 OF AN ACT OF CONGRESS APPROVED SEPT. 26, 1914 Docket 5190. Complaint, Nov. 24, 1947*—Decision, Jan, 16, 1950 Where three individuals engaged in the interstate sale of salve, vapor balm, menthol inhalers and miscellaneous merchandise, through agents under the returns 1 7 1 3 3 835 1189 31 18 96.527054 or5 1 7 1 3 4 889 1183 84 23 96.274605 remits 1 7 1 3 5 997 1183 94 29 44.702652 plan’,5 1 7 1 3 6 1114 1184 56 23 95.880348 ands 1 7 1 3 7 1192 1183 30 23 95.880348 in5 1 7 1 3 8 1245 1183 178 29 96.235558 advertising5 1 7 1 3 9 1445 1189 17 18 96.012131 a5 1 7 1 3 10 1484 1184 114 28 96.412354 variety5 1 7 1 3 11 1620 1184 32 23 96.660240 of5 1 7 1 3 12 1674 1184 118 23 92.919556 articles5 1 7 1 3 13 1814 1183 42 24 92.919556 of-4 1 7 1 4 0 620 1224 1236 30 -1 5 1 7 1 4 1 620 1224 82 24 96.242226 fered5 1 7 1 4 2 718 1225 28 23 96.594841 to5 1 7 1 4 3 761 1226 101 28 96.355103 agents5 1 7 1 4 4 877 1231 32 17 96.781738 as5 1 7 1 4 5 923 1225 163 29 96.737503 premiums,5 1 7 1 4 6 1103 1225 205 29 96.403450 commissions,5 1 7 1 4 7 1324 1231 32 18 96.061638 or5 1 7 1 4 8 1370 1226 213 28 96.173706 compensations 1 7 1 4 9 1599 1225 48 23 96.941689 for5 1 7 1 4 10 1663 1226 103 28 95.072113 selling5 1 7 1 4 11 1780 1225 76 24 96.331947 their4 1 7 1 5 0 622 1266 1234 30 -1 5 1 7 1 5 1 622 1266 151 29 95.949173 products;5 1 7 1 5 2 799 1267 126 26 96.628807 through5 1 7 1 5 3 948 1272 193 21 95.098778 newspapers,5 1 7 1 5 4 1165 1267 172 26 95.098778 magazines,5 1 7 1 5 5 1361 1267 141 26 95.660698 premiums 1 7 1 5 6 1525 1267 74 27 95.877594 lists,5 1 7 1 5 7 1623 1267 141 28 96.647072 premiums 1 7 1 5 8 1786 1267 70 29 96.735405 plan4 1 7 1 6 0 622 1308 1234 32 -1 5 1 7 1 6 1 622 1308 94 30 96.472397 books,5 1 7 1 6 2 739 1309 147 29 96.315033 circulars,5 1 7 1 6 3 907 1309 65 29 96.120270 posts 1 7 1 6 4 995 1309 93 29 96.519470 cards,5 1 7 1 6 5 1111 1310 112 24 96.140396 rewards 1 7 1 6 6 1246 1315 123 24 96.433548 coupons5 1 7 1 6 7 1390 1310 58 25 96.433548 ands 1 7 1 6 8 1469 1309 82 25 96.431000 others 1 7 1 6 9 1573 1310 148 28 95.597641 mediums,5 1 7 1 6 10 1744 1310 35 29 92.882217 by5 1 7 1 6 11 1801 1310 55 30 92.684395 pic-4 1 7 1 7 0 621 1351 508 29 -1 5 1 7 1 7 1 621 1355 79 22 96.674927 tures5 1 7 1 7 2 718 1352 57 23 96.480705 ands 1 7 1 7 3 794 1351 174 29 93.241135 descriptive5 1 7 1 7 4 986 1352 143 24 92.664032 matter—3 1 7 2 0 0 557 1392 1300 199 -1 4 1 7 2 1 0 557 1392 1300 31 -1 5 1 7 2 1 1 557 1392 47 29 94.873734 (a)5 1 7 2 1 2 629 1392 195 30 96.700508 Represented5 1 7 2 1 3 844 1392 66 26 96.837799 that5 1 7 2 1 4 929 1393 50 26 96.819954 thes 1 7 2 1 5 999 1393 117 25 96.484665 articles5 1 7 2 1 6 1136 1392 149 26 96.211250 described5 1 7 2 1 7 1304 1400 75 19 96.285645 were5 1 7 2 1 8 1399 1394 83 28 95.665993 given5 1 7 2 1 9 1501 1393 63 25 95.665993 free5 1 7 2 1 10 1584 1394 29 24 96.060707 to5 1 7 2 1 11 1633 1395 101 28 95.930038 agents5 1 7 2 1 12 1756 1393 101 30 96.113739 selling4 1 7 2 2 0 622 1435 1235 29 -1 5 1 7 2 2 1 622 1435 133 29 95.862762 specified5 1 7 2 2 2 777 1437 133 23 95.862762 amounts5 1 7 2 2 3 931 1436 31 25 96.700020 of5 1 7 2 2 4 982 1435 215 29 96.231316 merchandise;5 1 7 2 2 5 1229 1436 58 24 96.554527 ands 1 7 2 2 6 1309 1436 65 24 96.521408 that5 1 7 2 2 7 1396 1435 82 25 96.457779 others 1 7 2 2 8 1498 1436 157 28 96.296822 premiums5 1 7 2 2 9 1677 1442 75 18 96.703857 were5 1 7 2 2 10 1773 1435 84 29 96.959915 given4 1 7 2 3 0 620 1477 1236 30 -1 5 1 7 2 3 1 620 1478 63 25 96.069412 free5 1 7 2 3 2 699 1479 29 23 96.603218 to5 1 7 2 3 3 745 1478 82 24 96.917709 those5 1 7 2 3 4 842 1477 170 30 96.238007 submitting5 1 7 2 3 5 1027 1478 100 24 96.490799 orders5 1 7 2 3 6 1144 1478 102 24 96.957779 within5 1 7 2 3 7 1264 1477 53 25 96.787216 five5 1 7 2 3 8 1334 1478 71 28 96.544868 days5 1 7 2 3 9 1421 1478 31 24 95.397171 of5 1 7 2 3 10 1468 1478 49 24 96.994965 thes 1 7 2 3 11 1534 1478 109 28 96.720818 receipts 1 7 2 3 12 1659 1478 31 23 96.375076 of5 1 7 2 3 13 1708 1478 48 23 96.375076 thes 1 7 2 3 14 1772 1477 84 24 96.374611 order4 1 7 2 4 0 621 1518 1235 30 -1 5 1 7 2 4 1 621 1518 110 30 96.110382 blanks,5 1 7 2 4 2 748 1520 58 23 96.278603 ands 1 7 2 4 3 822 1521 29 23 96.278603 to5 1 7 2 4 4 868 1520 82 24 96.265533 those5 1 7 2 4 5 967 1519 171 29 96.644577 submitting5 1 7 2 4 6 1154 1520 49 24 96.990280 thes 1 7 2 4 7 1219 1520 136 28 96.595543 proceeds5 1 7 2 4 8 1372 1519 75 24 96.142647 from5 1 7 2 4 9 1465 1520 49 23 96.581314 thes 1 7 2 4 10 1531 1520 61 23 96.601265 sales 1 7 2 4 11 1609 1519 31 24 96.276352 of5 1 7 2 4 12 1657 1519 199 24 96.463196 merchandise4 1 7 2 5 0 621 1561 642 30 -1 5 1 7 2 5 1 621 1561 101 24 96.467133 within5 1 7 2 5 2 738 1562 47 23 96.273933 tens 1 7 2 5 3 800 1562 72 28 96.224068 days5 1 7 2 5 4 886 1562 31 24 96.463600 of5 1 7 2 5 5 930 1561 107 30 96.142494 receipts 1 7 2 5 6 1051 1562 31 24 96.601936 of5 1 7 2 5 7 1097 1562 48 24 96.300331 thes 1 7 2 5 8 1159 1562 104 28 96.058922 latter;3 1 7 3 0 0 550 1602 1306 324 -1 4 1 7 3 1 0 550 1602 1303 31 -1 5 1 7 3 1 1 550 1603 60 24 96.010605 Thes 1 7 3 1 2 629 1603 78 24 96.266495 facts5 1 7 3 1 3 724 1604 85 29 96.431557 beings 1 7 3 1 4 828 1604 65 24 96.827293 that5 1 7 3 1 5 912 1609 73 19 96.259277 none5 1 7 3 1 6 1003 1603 31 24 96.485481 of5 1 7 3 1 7 1052 1603 49 24 96.838867 thes 1 7 3 1 8 1120 1604 118 24 95.945724 articles5 1 7 3 1 9 1258 1603 163 25 95.998459 advertised5 1 7 3 1 10 1440 1609 32 18 95.998459 as5 1 7 3 1 11 1491 1602 95 25 49.364922 “free”5 1 7 3 1 12 1606 1610 31 18 96.498741 or5 1 7 3 1 13 1657 1603 99 29 96.596680 “given5 1 7 3 1 14 1774 1602 79 25 92.434235 free”4 1 7 3 2 0 620 1644 1235 32 -1 5 1 7 3 2 1 620 1651 75 19 96.376320 were5 1 7 3 2 2 714 1646 98 24 96.712997 actual5 1 7 3 2 3 829 1645 73 29 96.188896 gifts5 1 7 3 2 4 921 1651 32 19 96.386223 or5 1 7 3 2 5 972 1646 83 28 96.291603 given5 1 7 3 2 6 1074 1651 32 19 95.994560 as5 1 7 3 2 7 1126 1651 17 18 95.994560 a5 1 7 3 2 8 1162 1645 129 31 96.221550 gratuity5 1 7 3 2 9 1310 1644 123 26 95.870064 without5 1 7 3 2 10 1453 1645 229 29 96.135109 consideration;5 1 7 3 2 11 1711 1645 51 24 95.833847 but5 1 7 3 2 12 1780 1650 75 19 96.881866 were4 1 7 3 3 0 620 1684 1235 35 -1 5 1 7 3 3 1 620 1688 103 28 96.202309 simply5 1 7 3 3 2 748 1687 163 32 95.879753 additional5 1 7 3 3 3 934 1688 214 28 96.303101 compensations 1 7 3 3 4 1172 1684 56 27 96.697304 for5 1 7 3 3 5 1243 1688 49 23 96.716576 thes 1 7 3 3 6 1316 1687 109 29 96.667320 agents’5 1 7 3 3 7 1450 1687 124 24 96.401260 services5 1 7 3 3 8 1598 1687 30 23 96.624374 in5 1 7 3 3 9 1654 1687 101 29 95.824760 selling5 1 7 3 3 10 1779 1687 76 24 95.824760 their4 1 7 3 4 0 621 1728 1235 31 -1 5 1 7 3 4 1 621 1730 77 24 96.493156 salves 1 7 3 4 2 711 1730 57 23 95.532410 ands 1 7 3 4 3 780 1729 84 30 95.532410 balm,5 1 7 3 4 4 877 1736 32 18 96.830795 or5 1 7 3 4 5 922 1729 172 29 96.367500 admittedly5 1 7 3 4 6 1107 1731 82 23 96.730721 extras 1 7 3 4 7 1203 1729 197 24 96.389542 commissions5 1 7 3 4 8 1412 1729 48 24 96.206329 for5 1 7 3 4 9 1472 1730 114 28 96.702576 prompt5 1 7 3 4 10 1599 1730 100 23 96.258621 returns 1 7 3 4 11 1714 1728 30 25 96.258621 of5 1 7 3 4 12 1756 1729 100 24 96.241112 orders4 1 7 3 5 0 620 1770 1234 31 -1 5 1 7 3 5 1 620 1778 31 17 97.009888 or5 1 7 3 5 2 665 1773 135 28 96.161186 proceeds5 1 7 3 5 3 815 1772 31 24 96.894699 of5 1 7 3 5 4 860 1772 76 28 96.845360 sale;5 1 7 3 5 5 961 1772 70 24 96.443474 with5 1 7 3 5 6 1048 1772 109 23 96.443474 certain5 1 7 3 5 7 1173 1771 164 29 95.861275 exceptions5 1 7 3 5 8 1358 1771 110 28 95.861275 (stated5 1 7 3 5 9 1484 1771 29 23 96.514229 in5 1 7 3 5 10 1528 1772 78 22 96.351379 theirs 1 7 3 5 11 1620 1771 141 29 96.214714 premiums 1 7 3 5 12 1775 1770 79 29 96.814766 list),4 1 7 3 6 0 620 1812 1234 31 -1 5 1 7 3 6 1 620 1814 39 23 96.475891 all5 1 7 3 6 2 676 1814 55 24 96.524498 dues 1 7 3 6 3 748 1814 118 29 96.239433 postage5 1 7 3 6 4 883 1820 32 18 96.219009 or5 1 7 3 6 5 932 1819 117 23 96.219009 express5 1 7 3 6 6 1067 1813 120 29 95.761696 charges5 1 7 3 6 7 1205 1818 75 21 95.935875 were5 1 7 3 6 8 1296 1813 69 30 95.636520 paid5 1 7 3 6 9 1382 1813 36 29 96.887672 by5 1 7 3 6 10 1435 1813 49 24 96.302246 thes 1 7 3 6 11 1503 1812 170 30 96.518097 recipients;5 1 7 3 6 12 1702 1813 57 23 96.739746 ands 1 7 3 6 13 1777 1819 77 17 96.839111 some4 1 7 3 7 0 619 1854 1237 30 -1 5 1 7 3 7 1 619 1855 31 24 96.675049 of5 1 7 3 7 2 665 1856 48 23 96.813698 thes 1 7 3 7 3 727 1855 155 29 96.486206 premiums5 1 7 3 7 4 897 1855 184 29 96.453766 represented5 1 7 3 7 5 1097 1861 33 18 96.591515 as5 1 7 3 7 6 1145 1855 98 29 96.591515 “given5 1 7 3 7 7 1258 1854 79 24 73.121407 free”5 1 7 3 7 8 1351 1861 75 18 96.457390 were5 1 7 3 7 9 1441 1855 28 23 95.452980 in5 1 7 3 7 10 1485 1854 62 24 95.452980 facts 1 7 3 7 11 1562 1860 87 18 96.762390 never5 1 7 3 7 12 1664 1855 143 24 96.155441 delivered5 1 7 3 7 13 1824 1857 32 21 96.155441 at4 1 7 3 8 0 619 1898 55 28 -1 5 1 7 3 8 1 619 1898 55 28 95.014755 all;3 1 7 4 0 0 556 1935 1297 32 -1 4 1 7 4 1 0 556 1935 1297 32 -1 5 1 7 4 1 1 556 1939 45 28 86.823639 (b)5 1 7 4 1 2 626 1939 85 25 96.387314 Made5 1 7 4 1 3 730 1946 50 18 96.061981 uses 1 7 4 1 4 797 1939 32 24 95.955986 of5 1 7 4 1 5 846 1940 49 23 96.458466 thes 1 7 4 1 6 912 1941 89 22 96.458466 terms5 1 7 4 1 7 1020 1939 101 24 96.146851 “fleece5 1 7 4 1 8 1139 1938 90 25 94.694870 twill”5 1 7 4 1 9 1247 1939 56 24 92.260406 ands 1 7 4 1 10 1323 1939 182 24 91.669838 “unexcelled5 1 7 4 1 11 1523 1939 102 24 95.158531 value”5 1 7 4 1 12 1643 1939 30 24 96.694832 in5 1 7 4 1 13 1691 1935 162 31 96.419533 describing3 1 7 5 0 0 620 1980 1235 31 -1 4 1 7 5 1 0 620 1980 1235 31 -1 5 1 7 5 1 1 620 1982 110 25 96.109512 certain5 1 7 5 1 2 750 1981 134 25 96.221748 blankets5 1 7 5 1 3 904 1980 108 27 96.248604 offered5 1 7 5 1 4 1033 1982 35 29 96.724396 by5 1 7 5 1 5 1089 1981 77 26 96.834778 them5 1 7 5 1 6 1187 1987 33 18 96.707512 as5 1 7 5 1 7 1240 1982 170 29 96.454376 premiums;5 1 7 5 1 8 1442 1981 261 30 95.860535 notwithstanding5 1 7 5 1 9 1724 1982 48 24 96.842361 thes 1 7 5 1 10 1792 1981 63 25 96.390877 fact3 1 7 6 0 0 618 2023 1236 72 -1 4 1 7 6 1 0 620 2023 1234 31 -1 5 1 7 6 1 1 620 2025 64 23 96.695320 that5 1 7 6 1 2 702 2024 64 24 96.685867 said5 1 7 6 1 3 784 2024 136 30 96.011261 products5 1 7 6 1 4 938 2029 75 19 95.988495 were5 1 7 6 1 5 1032 2025 59 28 95.961784 not,5 1 7 6 1 6 1109 2029 33 19 95.961784 as5 1 7 6 1 7 1161 2024 68 24 96.490120 thus5 1 7 6 1 8 1248 2023 192 30 96.164368 represented,5 1 7 6 1 9 1459 2024 84 23 96.164368 made5 1 7 6 1 10 1561 2023 31 24 96.219460 of5 1 7 6 1 11 1611 2024 80 28 96.691772 wool,5 1 7 6 1 12 1711 2023 50 24 96.264519 but5 1 7 6 1 13 1780 2028 74 19 96.386696 were4 1 7 6 2 0 618 2066 899 29 -1 5 1 7 6 2 1 618 2066 83 24 96.030075 made5 1 7 6 2 2 714 2066 31 25 96.851143 of5 1 7 6 2 3 757 2067 106 28 96.577133 cotton,5 1 7 6 2 4 876 2067 57 23 95.986984 ands 1 7 6 2 5 946 2067 94 23 96.744186 worth5 1 7 6 2 6 1053 2071 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2150 111 25 96.530602 certain5 1 7 8 1 6 1178 2151 135 23 96.472191 fountains 1 7 8 1 7 1330 2156 70 23 96.418648 pens5 1 7 8 1 8 1416 2156 32 19 96.418648 as5 1 7 8 1 9 1466 2150 139 29 96.285965 equipped5 1 7 8 1 10 1622 2150 70 23 96.804008 with5 1 7 8 1 11 1710 2150 34 23 96.339813 145 1 7 8 1 12 1759 2150 95 23 96.339813 Karat3 1 7 9 0 0 618 2191 776 31 -1 4 1 7 9 1 0 618 2191 776 31 -1 5 1 7 9 1 1 618 2193 64 29 96.787956 gold5 1 7 9 1 2 697 2193 97 29 96.485229 plated5 1 7 9 1 3 809 2198 55 24 96.079201 pens 1 7 9 1 4 878 2193 97 29 96.083626 points5 1 7 9 1 5 990 2193 56 24 96.947128 ands 1 7 9 1 6 1062 2199 32 19 95.613625 as5 1 7 9 1 7 1111 2192 148 30 95.416100 “amazing5 1 7 9 1 8 1275 2191 119 30 89.237000 offers”5 1 7 9 1 9 1384 2187 14 39 89.237000 ;3 1 7 10 0 0 554 2232 1299 74 -1 4 1 7 10 1 0 554 2232 1299 32 -1 5 1 7 10 1 1 554 2235 46 28 90.490875 (d)5 1 7 10 1 2 626 2235 114 29 91.372742 Falsely5 1 7 10 1 3 758 2235 180 28 96.420296 advertising5 1 7 10 1 4 954 2235 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7 13 1 4 887 2488 133 29 96.445793 capacity5 1 7 13 1 5 1042 2488 29 24 96.652901 to5 1 7 13 1 6 1092 2487 122 25 96.635010 misleads 1 7 13 1 7 1235 2487 57 24 96.619331 ands 1 7 13 1 8 1315 2487 112 25 96.547539 deceives 1 7 13 1 9 1449 2492 17 18 96.111267 a5 1 7 13 1 10 1488 2486 177 25 96.572746 substantial5 1 7 13 1 11 1685 2486 114 29 96.638809 portions 1 7 13 1 12 1822 2485 31 25 96.761192 of4 1 7 13 2 0 616 2529 1236 31 -1 5 1 7 13 2 1 616 2531 48 24 96.372795 thes 1 7 13 2 2 684 2530 175 30 92.186577 purchasing5 1 7 13 2 3 878 2530 96 30 96.874451 public5 1 7 13 2 4 994 2530 61 24 96.791901 into5 1 7 13 2 5 1077 2530 49 24 96.763733 thes 1 7 13 2 6 1146 2535 155 19 96.288895 erroneous5 1 7 13 2 7 1321 2529 88 25 96.208702 beliefs 1 7 13 2 8 1429 2529 65 25 96.509285 that5 1 7 13 2 9 1515 2530 71 24 96.600021 such5 1 7 13 2 10 1606 2529 246 29 96.788010 representations4 1 7 13 3 0 616 2570 1237 31 -1 5 1 7 13 3 1 616 2579 75 18 96.683846 were5 1 7 13 3 2 706 2573 71 28 96.506828 true,5 1 7 13 3 3 794 2572 58 24 96.506828 ands 1 7 13 3 4 868 2572 118 29 96.190079 thereby5 1 7 13 3 5 1002 2578 86 18 96.378441 causes 1 7 13 3 6 1105 2572 38 24 96.837387 its5 1 7 13 3 7 1158 2572 142 29 96.062569 purchases 1 7 13 3 8 1315 2571 31 25 96.812004 of5 1 7 13 3 9 1362 2571 176 24 96.749405 substantial5 1 7 13 3 10 1553 2570 159 30 96.140961 quantities5 1 7 13 3 11 1729 2570 31 25 96.140961 of5 1 7 13 3 12 1776 2571 77 24 96.266144 their4 1 7 13 4 0 617 2615 151 28 -1 5 1 7 13 4 1 617 2615 151 28 81.839783 products:2 1 8 0 0 0 589 2107 7 30 -1 3 1 8 1 0 0 589 2107 7 30 -1 4 1 8 1 1 0 589 2107 7 30 -1 5 1 8 1 1 1 589 2107 7 30 29.577225 ans2 1 9 0 0 0 554 2111 29 22 -1 3 1 9 1 0 0 554 2111 29 22 -1 4 1 9 1 1 0 554 2111 29 22 -1 5 1 9 1 1 1 554 2111 29 22 26.968643 (e2 1 10 0 0 0 547 2657 200 7 -1 3 1 10 1 0 0 547 2657 200 7 -1 4 1 10 1 1 0 547 2657 200 7 -1 5 1 10 1 1 1 547 2657 200 7 95.000000 2 1 11 0 0 0 580 2686 151 21 -1 3 1 11 1 0 0 580 2686 151 21 -1 4 1 11 1 1 0 580 2686 151 21 -1 5 1 11 1 1 1 580 2688 6 11 75.120079 ?5 1 11 1 1 2 597 2686 134 21 92.933632 Amended. Complaint 46 F. T.C.

ileld, That such acts and practices, 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.

Before Afr. Webster Ballinger, trial examiner. Mr. R. A. McOuat and Mr. R. P. Bellinger for the Commission. Mr. Morris k. Shapiro, of Chicago, Il., for respondents. AMENDED 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 Morris Shapiro, Charles Shapiro, and Mary Shapiro, individuals, trading as U-C-A Manufacturing 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 amended complaint, stating its charges in that respect as follows:

ParacrapH 1. Respondents are individuals trading and doing business under the name U-C-A Manufacturing Co., with their principal office and place of business at 1425 South Racine Avenue, Chicago, Ill. Respondents are now and for many years last past have been engaged in the sale of salve, vapor balm, menthol inhalers, and miscellaneous merchandise. Respondents cause said products, when sold, to be transported from their place of business in the State of Illinois to purchasers thereof located at various points in the several States of the United States and in the District of Columbia. Respondents maintain, and at all times mentioned herein have maintained, a course of trade in said products in commerce between and among the several States of the United States and in the District of Columbia.

Par. 2. Respondents’ method of conducting their business is what is commonly known as the “return or remit plan.” In the course and conduct of their business in said commerce as aforesaid and for the purpose of inducing the purchase of their said products, respondents have advertised and do advertise in various newspapers, magazines, premium lists, premium plan books, circulars, post cards, reward coupons, and other media for agents to sell their merchandise on the said “return or remit plan,” under which plan such agents are furnished the merchandise to be sold and are allowed 30 days to sell the same and remit to respondents the agreed portion of its selling price or to return the unsold portion of the merchandise. No deposit is U-C-A MANUFACTURING CO. 369 367 Complaint required and the goods remain the property of the respondents until paid for. Respondents include with the shipment of merchandise one sachet perfume pack to be included with each box of salve sold, which respondent represented to “give away free.” The selling agent may remit the stated sum of the amount collected and keep the rest as commission; or may remit the entire sum collected and receive merchandise in lieu of cash commissions. Said premiums are represented by respondents as “given” to agents “free.” If the sum collected by the agent on the sale of the merchandise is remitted within 10 days, the agent is promised an additional premium, which premium is advertised and represented by respondents to be “given” the agent “free.” The agent may remit other stated amounts in addition to and together with the sum collected upon the sale of the merchandise and receive an additional premium described as a “gift,” and if the agent submits his order for the sale of merchandise within 5 days of the receipt by him of the order blank, respondents promise to send to him an additional premium as a “gift,” “free.”

Par. 8. The advertising placed by respondents in various newspapers, magazines and other media as aforesaid, is variously devised to show by pictures and descriptive matter representations of blankets, billfolds, pen and pencil sets, clocks, guitars, movie projectors, bicycles, wagons, rifles, radio sets, watches and various and sundry other articles not herein enumerated offered to agents as premiums, commissions, or compensation for selling respondents’ “U. C. A. Salve,” “U. C. A. Menthol Salve” and “U. C. A. Vapor Balm.” The articles so featured and offered as premiums are variously designated, described and represented as follows:

Blankets. :

Given * * * a pair of blankets or cash commission * * a pair of fleece twill blankets * * * a premium of unexcelled value * * * for selling only 12 boxes U-C-A Salve at 25¢ a box (nothing more to sell). Sachet perfume sent to give away free.

Billfold. .

Given, genuine leather billfold. Genuine leather. Given for selling only 12 boxes U-C-A Salve.

Pen and Pencil Set, and Wallet.

GIVEN! An Amazing offer GIVEN! Fountain Pen Set and Wallet. * * * a nationally known manufacture * * * backed ‘by a guarantee service and has most of the features found on high priced pens. * * * 14K Gold Plate * * * Pen Point.

Clock.

ALL AMERICAN CLOCK GIVEN. America’s most beautiful Clock. A REAL $5.00 value, masterpiece in perfect time telling. Flag automatically twirls Complaint 46F.T.C.

round and round and this action shows the clock operates. Suitable for finest homes. Fully guaranteed Electric movement. GIVEN for selling only $3 worth of U-C-A Products (12 articles at 25¢ each) giving Sachet Free. Guitar.

BIG GUITAR GIVEN. Standard size Guitar—Regulated fretted, ebonized finger-board—Pearl Position dobts—GIVEN—Simply given away FREE Sacket Perfume and famous U-C-A Salve which you sell to friends at 25¢ per box and remit as per premium plan book, Movie Projector.

GIVEN, BOYS! GIRLS! MOVIE PROJECTOR. SHOW MOVIES AT HOME, Fully equipped with alternating current electric motor. Will accommodate 200 feet of film—8 minute show. GIVEN—Simply given away FREE Sachet Perfume with famous U-C-—A Salve which you sell to friends at 25¢ per box and remit as per premium plan book.

* Bicycle. BIKE GIVEN You can get a Boy’s or Girl’s RANGER Zephyr Bicycle easy. Fully equipped, Hlectric horn and headlight, coaster brake, balloon tires, for SIMPLY GIVING AWAY FREE Fragrant Sachet. Perfume with our Famous UCA MENTHO SALVE * * * which you sell at 25¢ a box (with Sachet Perfume FREE) and remitting as per our Premium Catalog Plan Book. Write today for order of UCA Mentho Salve and Sachet Perfume sent, Postage Paid * * *, Wagon.

WAGON GIVEN. NOTHING TO BUY! NO RISK—NO CASH, JUST MAIL. CARD, * * * GIVEN without one cent of cost by simply GIVING AWAY FREE Sachet Perfume with our famous U. C. A. Salve which you easily sell at 25¢ a box and remit as explained in Premium Catalog Book. Radio Set and Rifle.

PHILCO RADIO GIVEN This 22 Cal. Bolt Action Safety Rifle or Superhetrodyne Philco, or ZENITH Radio—you can easily get one of these Radios or Rifles by SIMPLY GIVING AWAY FREE Sachet Perfume with famous U-C-—A Household SALVE which you sell at 25¢ a box and remit as per new big Premium Plan Book! SPECIAL: Large list of premiums in catalog for selling only 12 boxes—$3.00 worth. It’s easy. Mail Coupon NOW—today. Be first.

Wrist Watch. :

7 JEWEL—WRIST WATCH GIVEN, GIRLS. LADIES! Here is just the prettiest watch you can imagine! Made in America. Case has Charm and color of Natural Yellow Gold Stainless steel back. Raised Gold numerals on Silvered Background. Watch is small—width of dial is smaller than a dime. Given— Simply given away FREE Sachet Perfume with famous U-C-A Salve which you sell to friends at 25¢ per box and remit as per premium plan book. Big list of premiums for selling only 12 Boxes U-C-A Salve at25¢each * * * You can have cash if you prefer.

SPECIAL OFFER FOR PROMPTNESS FREE of extra cost. This is in addition to your regular premium, JUST FOR BEING PROMPT! We want quick action and we are willing to pay for it * * *. All you have to do is get busy and sell this package of salve. Send us $3 which you collect so it will reach U-C-A MANUFACTURING CO. 371 367 Complaint us in 10 days and you will have this beautiful * * * in addition to your regular premium * * *, SPECIAL EXTRA PRESENT. RETURN NO MONEY. GET AN EXTRA PRESENT FREE. As soon as you receive this order of goods, start out at once and sell them quickly. Send us the money within 10 days after you receive the goods, and you will be rewarded with an extra present absolutely free * * *, SPECIAL PRESENT FOR PROMPTNESS.

FREE SINGING LARIET SENT FREE * * * IF you will mail this card within 5 days after its receipt by you. * * * CHOOSE ANY PREMIUM. YOURS WITHOUT ONE CENT COST. DON’T DELAY! ACT NOW! You will be delighted with these beautiful articles of guaranteed quality! Oh Boy! Imagine yourself speeding down the avenue on an up-to-the minute Streamlined Bike, fully equipped. Imagine yourself the proud owner of the big advertised Wagon shown here, the boys’ or Girls’ wrist watches * * *—yesand cash for spending money—all yours for simply giving away FREE Sachet Perfume with famous U-C-A Salve which easily sells at 25¢ a box * * * (with FREE perfume) and remit as explained in Premium Catalog Plan Book. Big list of premiums for selling only 12 boxes U-0-A Salve at 25¢ each. U-C-A Manufacturing Company, Chicago, Mlinois.

Par. 4. Through the use of the foregoing statements and representations and others of similar import not specifically set out herein, the respondents represent and have represented, directly and by implication, that they are manufacturers or makers of the products so advertised; that the particular premiums so advertised are given free to agents selling the specified amounts of merchandise stated and other premiums are given free to persons submitting orders for the merchandise within 5 days from the receipt of the order blank and submitting the proceeds from sales of merchandise within 10 days from the receipt of the merchandise; that the blankets are made of the wool of sheep; that the billfolds are genuine leather; that the fountain pens are equipped with 14 K gold plate pen points and are backed by service guarantee of a nationally known manufacturer; that the clocks are America’s most beautiful and are masterpieces in time telling and are of a value of $5 and will run 7 days without rewinding; that the movie projectors are fully equipped with 200 feet of film; that the bicycles, wagons, radio sets, rifles, wrist watches and other articles offered as premiums are delivered to agents in lieu of the $1 cash commission for the sale of 12 boxes of salve sold at 25 cents each for a total of $3; that the packets of sachet perfume distributed with other articles of merchandise sold are given to the purchasers of the merchandise as a gift or gratuity; that the premiums listed are fully equipped and function in the manner and according to the purposes Complaint — 46 F. T.C, for which like articles similarly designed and constructed are represented and intended to be used.

Par. 5. In truth and in fact, respondents are not manufacturers or makers of the products which they vend and do not own, operate, oy control a factory, plant or laboratory where such products are manufactured, made or compounded; the various aforesaid articles offered to agents as premiums for the submission of orders within 5 days and for the remittance of sums of money procured from the sale of respondents’ products within 10 days after the receipt of the merchandise are not gifts and are not given free, but are compensation in lieu of cash paid for services rendered; the sachet perfume included with the sale of respondents’ products is not given away free, and the so-called gifts offered for promptness are never delivered to the agents. Respondents do not pay postage on all goods shipped to the agents and the premiums offered for the sale of merchandise are not awarded in conformity with the representations made by respondents, and some of the aforesaid premiums are never awarded to agents and other of said premiums are not fully equipped to perform the functions for which they are represented, designed and intended and for which they are ordinarily and customarily used and are only awarded upon payment by the agent of a sum in cash over and above the commission allowed. The blankets represented as premiums are not made from the wool of sheep, and are not all wool, and are not of unexcelled value; the billfolds are not genuine leather; the fountain pens are not equipped with 14 K gold plate pen points and are not backed by service guarantee of a nationally known manufacturer; the clocks are not America’s most beautiful and are not masterpieces in time telling and are not of the value of $5 and are not 7-day clocks and will not run over 24 hours without rewinding; the movie projectors are not delivered fully equipped with 200 feet of film. Respondents’ sales plan generally contemplates the sale of specified amounts of merchandise to obtain premiums, and the said bicycles, wagons, radio sets, rifles, wrist watches and many other articles of value offered as principal premiums are not “free,” or “given,” or “given free,” or “given away free” where no cash commission payment is involved, inasmuch as the premium constitutes in fact compensation for valuable services rendered respondents. Likewise where premiums are given or accepted in lieu of or in addition to the commissions due, said premiums are not “free,” or “given,” or “given free” or “given away free” inasmuch as they represent the equivalent of money earned and due for valuable services rendered. The use of the word “given” in the manner em- ~ ployed by respondents in their advertising conveys the impression to U-C-A MANUFACTURING CO. 373 367 Findings purchasers that the articles so described are in fact free, when in fact payment is required in order to obtain said articles as hereinabove described.

In truth and in fact, the majority, if not all, of the aforesaid various premiums, so-called gifts, represented as given free, and advertised by respondents to be obtainable by their selling agents on completing the sales of a specified number of packages of salve or other merchandise are only obtainable by such selling agents upon the payment of various sums in cash in addition to cash remittances realized upon the sale of such merchandise, and in truth and in fact, the only goods upon which respondents pay postage are the items of merchandise forwarded to selling agents for sale by them. While it is true that upon receiving an application from an individual who desires to become a selling agent, respondents send with the merchandise forwarded to such selling agent various communications in which it is indicated that the receipt of many of the so-called gifts or premiums aforesaid is conditional upon payment of an amount in cash in excess of the proceeds from the sale of such merchandise; nevertheless, such conditions are so presented to prospective selling agents as to fail to negative the representations in this regard contained in respondents’ advertising.

Par. 6. The use by respondents of the false, deceptive, and misleading statements and representations set forth herein has had and now has the capacity and tendency to mislead a substantial portion of the. purchasing public into the erroneous belief that such statements and representations are true, and into the purchase or sale of substantial quantities of respondents’ said products as a result of such erroneous belief.

Par. 7. The aforesaid acts and practices of the 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, FINDINGs as TO THE Facts, AND ORDER Pursuant to the provisions of the Federal Trade Commission Act, the Federal Trade Commission on July 15, 1944, issued and subsequently served upon the respondents named in the caption hereof its complaint, charging said respondents with the use of unfair methods of competition in commerce in violation of the provisions of that act. The respondents’ answer to said complaint having been filed, testimony and other evidence were introduced before a trial examiner of Findings 46 F.T.C.

the Commission theretofore designated by it, and such testimony and other evidence were duly recorded and filed in the office of the Com- ‘mission. Subsequently, the trial examiner submitted his report, to which the respondents filed a number of exceptions, and in due time written briefs in support of and in opposition to the complaint were filed.

After having afforded the respondents an opportunity to show cause why the complaint should not be amended pursuant to a motion filed by counsel in support of the complaint, and after having considered said motion and the respondents’ written objections thereto, the Commission on November 24, 1947, issued and subsequently served upen the respondents its amended complaint, charging said responderts with the use of unfair and deceptive acts and practices in comraerce in violation of the provisions of the Federal Trade Commission Act. The respondents’ answer to said amended complaint was filed on January 19, 1948.

At a hearing before the trial examiner held on October 7, 1948, a stipulation was entered into by and between the respondents and counsel in support of the amended complaint, and in said stipulation it was agreed that for the purpose of disposing of this proceeding the record should consist of the amended complaint and the answer thereto, the testimony and other evidence theretofore received in support of and in opposition to the original complaint, the trial examiner’s report, and the briefs theretofore filed, and that the Commission might proceed upon such record to make its findings as to the facts and to enter its order disposing of said proceeding. Thereafter, this proceeding regularly came on for final hearing before the Commission upon the amended complaint, the respondents’ answer thereto, the testimony and other evidence, the stipulation, the trial examiner’s report and the respondents’ exceptions thereto, and briefs in support of and in opposition to the complaint (oral argument not having been requested) ; 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, Morris Shapiro, Charles Shapiro, and Mary Shapiro, are individuals trading and doing business under the name U-C-A Manufacturing Co. Their office and principal place of business was formerly maintained at 1425 South Racine Avenue, U-C-A MANUFACTURING CO. 375 3867 Findings Chicago, Il., but is now located at 1933 South Halsted Street, Chicago, Ill. Said respondents are now, and for a number of years last past they have been, engaged in the business of selling salve, vapor balm, menthol inhalers, and miscellaneous merchandise. Par, 2. The respondents cause the aforesaid products, when sold, to be transported from their place of business in the State of Illinois to purchasers thereof located at various points in the several States of the United States and in the District of Columbia. Said respondents maintain, and at all times mentioned herein they have maintained, a regular course of trade in such products in commerce among and between the several States of the United States and in the District of Columbia.

Par. 3. The respondents’ method of selling their products consists of a plan commonly referred to as the “return or remit plan,” under which plan agents are furnished the products in lots of 12 boxes, to be sold at 25 cents a box, and are allowed 30 days within which to sell the same and remit to the respondents 2 collars of the proceeds, retaining as their commissions 1 dollar thereof; or, if the entire 12 boxes have not been sold, to remit to the respondents 25 cents for each box sold and return the unsold portion of the merchandise. In lieu of the 1 dollar cash commission for selling the 12 boxes of salve and balm, the agents may elect to receive any one of a number of premiums depicted’ in a catalog furnished them by the respondents, each of which premiums is described as a “$3 Prize.” No deposit is required on the salve and balm so furnished the agents, and the merchandise remains the property of the respondents until paid for. With each shipment of 12 boxes of salve and balm the respondents formerly included 12 packs of sachet perfume, it being intended by them that 1 pack of such perfume should be “given free” to the purchaser of each box of salve or balm at 25 cents a box, but the respondents tetsified that this particular practice was discontinued sometime in 1944. Under the respondents’ plan of operation, if a prospective agent accepts the respondents’ offer of an agency within 5 days after receiving the offer the respondents promise him a “special extra present” which they describe as being a reward given “absolutely free.” If the agent sells the 12 boxes of salve and balm and remits the sales price, less his commission, within 10 days after receipt of the merchandise the respondents promise him still another “extra present—absolutely free.” The agent may also remit other stated amounts in addition to and together with the sum collected upon the sale of the merchandise and receive from the respondents other premiums described by them as “gifts.”

Findings 46 F.T.C.

The volume of salve and balm sold by the respondent by the abovedescribed method has been around 1,000,000 boxes a year. Par. 4. In an effort to obtain agents to sell their products under the aforesaid plan, the respondents advertise in various newspapers, magazines, premium lists, premium-plan books, circulars, and on post cards, reward coupons, and other media. Such advertising is variously devised to show by pictures and descriptive matter representations of blankets, billfolds, pen and pencil sets, clocks, guitars, movie projectors, bicycles, wagons, rifles, radio sets, watches, and various other articles offered to agents as premiums, commissions, or compensation for selling the respondents’ products. In the manner and by the means aforesaid, the respondents have represented, among other things, that the particular articles described in their literature were given free to agents selling the specified amounts of merchandise stated; that other premiums were given free to persons submitting orders within 5 days of the receipt of the order blanks and to persons submitting the proceeds from the sale of merchandise within 10 days of the reecipt of the merchandise; that the blankets described were made of the wool of sheep and were of unexcelled value; that the billfolds described were made of genuine leather; that the fountain pens described were equipped with 14karat gold-plate pen points; that the clocks described were America’s most beautiful and were masterpieces in time telling, each of which was of the value of 5 dollars; and that the packets of sachet perfume to be distributed with the salve and balm sold by the agents were given free to the purchasers of the salve and balm as gifts or gratuities. Par. 5. The record clearly establishes that none of the articles advertised by the respondents as being “free” or “given free” to agents selling the specified amounts of merchandise, or to persons submitting orders within 5 days of the receipt of such orders, or to persons submitting the proceeds from the sale of merchandise within 10 days of the receipt of the merchandise, were actual gifts or were given as a gratuity without consideration. In the case of agents selling specified amounts of merchandise the articles described were simply additional compensation for the agents’ services in selling the respondents’ salve and balm, and in the case of persons submitting orders within 5 days and persons submitting the proceeds of sale within 10 days the respondents admitted that the articles awarded were extra commissions for prompt returns. Moreover, except in certain instances in which the respondents “directly” stated in their premium lists that they would pay the postage or express charges on such articles, all of these charges were paid by the recipients, and it further appears U-C-A MANUFACTURING CO. 377 867 Order that some of the premiums which the respondents represented as being “given free” were in fact never delivered at all. The blankets offered by the respondents as premiums and described by them as “fleece twill” and of “unexcelled value” were not made of wool, but of cotton, and each of such blankets was worth no more than approximately 1 dollar. They were not of “unexcelled value.” The billfolds described in the respondents’ advertising as “genuine leather” were made of sheep skin with cloth linings, and the fountain pens referred to by the respondents as “amazing offers” were not equipped with 14-karat gold plate pen points. The clocks offered by the respondents were not “America’s most beautiful,” were not “masterpieces in time telling,” and they were not worth 5 dollars each as the respondents advertised. Contrary to the respondents’ representations, the sachet perfume, said to have been “given free” to purchasers of salve and balm, was not a gift, but was a part of a combination offer of salve or balm and sachet perfume, both of which.together sold for the price of 25 cents.

For the foregoing reasons and in the particulars stated, the respondents’ advertising representations referred to in paragraph 4 were and are false, misleading and deceptive. Pan. 6. The use by the respondents of the foregoing false, misleading and deceptive statements and representations has had the tendency and capacity to mislead and deceive a substantial portion of the purchasing public into the erroneous and mistaken belief that such statements and representations were true, and the tendency and capacity to cause such portion of the public, because of such erroneous and mistaken belief, to purchase substantial quantities of the respondents’ products.

CONCLUSION The acts and practices of the respondents as herein found have all been to the prejudice and injury of the public and have constituted 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 amended complaint of the Commission, the respondents’ answer thereto, testimony and other evidence introduced before a trial examiner of the Commission theretofore duly designated by it, a stipulation entered into by and between the respondents and counsel in support of the amended complaint, the trial examiner’s report and Order 46 F.T.C.

the respondents’ exceptions thereto, and written briefs (oral argument not having been requested) ; and the Commission, having made its findings as to the facts and its conclusion that the respondents have violated the provisions of the Federal Trade Commission Act: It is ordered, That the respondents, Morris Shapiro, Charles Shapiro, and Mary Shapiro, individually and as co-partners trading as U-C-A Manufacturing Co., or trading under any other name or through any corporate or other device, and said respondents’ agents, representatives and employees, in connection with the offering for sale, sale or distribution in commerce, as “commerce” is defined in the Federal Trade Commission Act, of salve, vapor balm, menthol inhalers or other articles of merchandise, do forthwith cease and desist from:

1. Using the words or terms “given,” “free,” “given free” or “given away free”, or any other word or term expressly or impliedly importing a like meaning, in advertising, to designate, describe or refer to any article of merchandise which is not in fact a gift or gratuity or which is not given without requiring the purchase of other merchandise or the performance of some service inuring directly or indirectly to the benefit of the respondents. 2. Using the term “fleece twill,” or any other term of similar import or meaning, to designate, describe or refer to blankets or other articles not made of wool or otherwise representing, directly or by implication, that any article not made of the wool of sheep is made of wool. 3. Representing, directly or by implication, that billfolds or other articles made of substance other than leather are made of leather. 4. Representing, directly or by implication, that fountain pens not equipped with 14-karat gold plate pen points are so equipped. 5. Misrepresenting in any manner the value, quality, condition or characteristics of any article offered as a premium, commission or compensation for selling the respondents’ products. 6. Offering as a premium, commission or compensation any article which it not in fact delivered upon full compliance with the terms or conditions of the offer.

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

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