Andrew G. Cholick

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

IN THE 1\L1.TTER OF ANDRE\V G. CHOLICK ET AL. TRADING AS WESTERN TRAINING SERVICE CO~lplaint, FINDINGS, AND ORDERS IN REGARD TO THE ALLEGED VIOLATION OF SEC. 5' OF AN ACT OF CO!\GRBSSAPPROYED SEPT. 26, 1914 Docket 5821. Compla' int, Oct. 21, 1950-Decision, Feb. 14, 1952 Wbere three partners engaged in the intl~rstate sale and clistrilmtioll of correspondence courses to prepare students for examination for certain Government Civil Service positions; in promoting the sale of their courses through newspaper advertisements and postal cards mailed to post office and rural route box holders, and through traveling agents- (a) Represented that persons completing their course and passing a civil service examination were assured of positions in the United States Civil Service through such statements as HMen and 'Vomen 'Wanted to Prepare for Civil Service .Jobs, Act Now, HCivil Service Men, Women, 18 to 50, Many Opportunities" and, after listing numerous positions A Few of the Hundreds of Different Kinds of Positions Tbe facts being that while numerous vacancies may exist generally in said service, the taking of their course of study and the passing of a civil service examination does not assure employment, which is subject to veteran s preference, a\"HilHbilit~. of eligihle:,: in YHrious distrkt:,:, nnd other conditions and uncertainties;

(b) Misleadingly represented that a common school or eighth grade education was usually sufficient to qualify for and obtain positions in the Civil Service; when in fact while such an education might he sufficient for most of tbe lower grade positions, for many a high school education is required, and in still others additional special training, specific physical qualification or practical experience; and (c) Represented in some instances, throw?:h their agents, that the agent visited a given territory only once every two years and that unless prospective students elll~olled at the time of his visit, they would have to wait two years before they would have another oIlportunity; notwithstanding- the fact that l1rospective students could enroll at any time; With tendency and capacity to mislead and deceive a substantial portion of the purcbasing public into tbe erroneous belief that such representations were true and thereby induce its purchase of said corresi1onclence coursei;: Held, 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.

Other charges of the complaint were not sustained by the record: namely, that respondents through their advertising' or sales agent~. 01' both. l'P-presented and- implied that said correspondence school was a branch of or connected with the Goyernmellt of the United States Ciyil Senice Commission; that respondents' representatives and agents were similarly thus connected; that respondents would continue training students until they had been placed in Government positions; that positions were permanent once an employee had sened his first year of probation; that the school had on its staff fanner WESTERN TRAINING SERVICE 767 766. Complaint Government examiners; that only thoi"e with higl1 qualification:!': were accepted, and that the school was under Government sl1pel'Yision. Before M1'. TVillia1n L. Pack hearing examiner. jJf1,. 1Fillia1n L. Pe17.cke for the Commission. 1111'. A. O. Allen and 11h,. Solon B. Ola'tk of Portland, Oreg., 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 Andrew G. Cholick A. Lawrence Cholick and Joseph J. Cholick, copartners, trading as ",Vestern Training Service, hereinafter referred to as respondents have violated the provisions of the said Ad, 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 follo',"s:

PAJL\GRAl'H 1. Respondents Andre,,' G. Cholick, A. Lawrence Cholick and Joseph J. Cholick are individuals trading and doing business as copartners under the name and style of "'V e~tern Training Service, with their office and principal place of business at 206 Panama Building, Portland, Oregon.

PAR. 2. For more than one year last past, respondents have been and are now engaged in the sale and distribution in commerce bet,veen and among the various States of the United States of courses of study and instruction intended for prr.paring students thereof for examination for certain Civil Service. positions under the United States Government, which said courses are pursued by correspondence through the medium of the United States mails. Respondents, in the course and conduct of saiel business, cause their said courses of study and instruction to be transported from their said place of business in the State of Oregon to, into and through States of the United States other than Oregon to the Pllrchasers thereof in such other States. There has been at all times mentioned herein a course of trade in said courses of instructions so sold and distributed by respondents in eOlllmerce between and among the various States of the United States. PAR. 3. In connection with the sale of said courses of study and instruction, respondents have made and are making use of printed advertising matter distributed to prospective students throughout the central and western States, and of advertisements inserted in newspapers eirculated in said States, in and by which numerous representations have been made and are made in regard to said courses of study 213S40--~4---- Complaint 48 F. T. C.

and matters and things connected therewith. Typical of such representations are the following:

TRAIN FOR CIVIL SERVICE Permanent Employment, Vacations, Pensions and Sick ~Lea ve Offered By State, County, City and Federal Civil Service. Stenographers, Typists, Postal, Customs. Revenue, Immigration, Veterans Adm. Clerks & Inspectors, etc. In:,truction for these and many others may be had from the old Licensed School , Established in 1931. For Information address:

WESTERN TRAINING SERVICE Box 99 % Humboldt Standard.

MEN AND WO:\len Ages 18 to 50 GOVERNMENT POSITIONS Thousands to be Filled Clerks, Internal revenue agents, railway mail clerks, accountants, post office clerks mail carriers, immigration service, custom service, veterans administration, stenographers typists, storekeepers, assistant mea t inspectors; many others to choose from Steady employment. Instruction now being given.

WESTERN TRAINING SERVICE (Established 1931) 206 PANAMA BLDG. Portland 4, Or.

Send me full information.

PREPARE AT HOME FOR A GOVERNMENT JOB Security. Vacations Promotions. Pensions Write WESTERN TRAINING SERVICE 206 Panama Bldg. I' ortland 4, Ore.

WESTERN TRAINING. SERVICE 769 766 Complaint PAR. 4. By means of the foregoing statements and representations and others to the same effect not herein set out, respondents represent and imply that said vVestern Training Service is a branch of or connected with the United States Government or the United States Civil Service Commission; that many positions in the United States Civil Service, including those specifically named in said advertisements, are vacant; that men and women are needed to fill said vacancies and that said positions may be obtained through respondents' vVestern Training Service.

PAR. 5. By means of oral statements and representations made by their sales agents, respondents represent and imply to prospective students and purchasers of their said courses of instruction that said representatives and sales agents are connected with the United States Government or the United States Civil Service Commission in some official capacity; that respondents will continue training students until they have been placed in Government positions; that students taking said course of training will pass a Civil Service examination and be sure of a job in the United States Civil Service; that respondents said school is in some manner connected with the United States Government or the United States Civil Service Commission and has special contacts with said Civil Service Commission enabling said school to give advance information on examination dates and to assist students in procuring Civil Service positions; that positions are permanent once an employee had served his first year of probation; that respondents' school has on its staff former Government examiners; that an eighth grade education is sufficient to qualify for and to obtain positions in the classifications for which respondents offer training, and that not everyone is signed up for such training but that only those with high qualifications are accepted; that the school is under Government supervision; that salesmen visit a given territory once every two years, and that unless prospective students enroll at the time of the salesmen s visit they will have to wait for two years before they can have another opportunity to enroll.

By means of return postal cards, listing a large number of Civil Service positions, addressed to rural route box holders, and by furnishing to prospective students and enrollees a booklet entitled "flow TO GET A GOVERNMENT JOB " respondents and their salesmen further the impression and implication that respondents' school is connected with or authorized by the United States Government to train persons for Government positions and that said salesmen operate under some official authority.

770 FEDERAL TRADE COMl\HSSION DECISIONS . Complflint 48 F. T. C. In said sales literature and advertisements, respondents represent. that their school was licensed and has been continuously operateel since 1931.

PAR. 6. All of said statements, representations, and implications are grossly exaggerated, false and misleading. In truth and in fact, thereJ is no connection whatsoever between respondents or their salesmen and the United States Government, the Ullited States Civil Service Commission or any other agency or branch of the Government, nordoes the. Government supervise respondents' school. The United States Civil Service Commission does not advertise for men and women to fill Government positions or that vacancies exist in Go'~ern- Juent Service.. Respondents have no power or authority to place any person in any Civil Serviee position, or guarantee. that such person will pass Civil Service examinations by taking said courses of instruction. Responde.nts' representations that there are certain vacancies in the. United States Civil Service and that students would continue to be trained until they pass an examination and are placed in Civil Service positions implies that such examination may be called within the near future, when in fact examinations for a number of positions listed in respondents' sales literature and advertisements Juay not be. ealled for several years. ~loreover, a number of positions, including guards, custom inspectors, custodians, and others, are restricted to ten-point veteran applicants. Respondents have no special contacts with the Civil Service Commission or any other branch of the Government and possess no advance information pertaining to Civil Service. examinations; nor have they any information which persons interested in examinations cannot readily obtain from the Civil Service Comll1ission, their regional offices, or local post offices. "\Vhile Government positions are generally permanent, there are many circumstances under which employees may be separated from the service. Respondents have no former Government examiners on their teaehing staff.

While an eighth grade education may be sufficient for most of the lower grades, a high school education is required for many positions and still other positions require special training, special physical qualifications or experience. Respondents do not limit enrollments. to persons with high qualifications but accept enrollments from all persons .who are willing to purchase said courses of instruction.. Prospective purchasers may purchase said CO~ll'ses of instruction at any time they desire and are not required to wait for a period of b,o years after declining to enroll on the occasion of the salesman s first visit. Respondents have not operated such school continuously since.. WESTERN TRAINING SERVICE 771 '766 Decision 1931 as it was closed during the period of ",Vorld "'17" ar II and for some time thereafter.

PAR. 7. In the course and conduct of their business as aforesaid respondents in soliciting enrollment make use of a printed form of contract designated "Enrollment Agreement" which contains a statement that:

I def'ire to secure a Ciyil Sel',ice appointment and ~should I fail to pass the first examinatic'n taken, I am to recei"ve, without further payment, coaching UNTIL I RECEIVE MY APPOINTMENT. Said representation is misleading in that no one may secure a Civil Service appointment through respondents' said school and continued coaehing will not necessarily lead to an appointment to the Civil Service; and if a student should qualify for and pass an examination it does not insure an appointment but may merely be the means of having said student's name placed on a register and such student may not be offered an appointment for a long time after passing said examina tion.

PAR. 8. The use by respondents of the statements and representations aforesaid, has had and nmv has the tendeney and capacity to and does confuse, mislead and deceive members of the public into the erroneous and mistaken belief that such statements and representations are true, and to induce them to purchase respondents' courses of study and instruction in said commerce on account thereof. PAR. 9. The aforesaid acts and practices 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. DECISION OF THE COMMISSION Pursuant to Rule XXII of the Commission s Rules of Practice and as set forth in the Commission s "Decision of the Commission and Order to File Report of Compliance " dated February 14, 1952, the initial decision in the instant matter of I-Iearing Examiner ",Villiam L. Pack, as set out as follows, became on that date the decision of the Commission.

INITIAL DECISION BY WILLIAM L. PACK, HEARING EXAMINER Pursuant to the provisions of the Federal Trade Commission Act the Federal Trade Commission on October 24, U)50, issued and subsequently served its complaint in this proceeding upon the respondents named in the caption hereof, charging them with the use of unfair and deceptive acts and practices in commerce in violation of the 772 FEDERAL TRADE COMl\HSSION DECISIONS Findings 48 F. T. C.

provisions of that Act. After the filing by respondents of their answer to the complaint, hearings were held at which testimony and other evidence in support of and in opposition to the allegations of the complaint were introduced before. the above named hearing examiner, theretofore duly designated by the Commission, and such testimony and other evidence were duly recorded and filed in the office of the Commission. Thereafter the proceeding regularly came on for final consideration by the hearing examiner upon the complaint, answer, and testimony and other evidence (counsel having elected notJo file proposed findings and conclusions for consideration by the hearing examiner or to argue the matter orally), and the hearing examiner, having duly considered the matter, finds that this proceeding is in the interest of the public and makes the following findings as to the facts, conclusion drawn therefrom, and order: FINDINGS AS TO THE FACTS PARAGRAPH 1. The respondents, Andrew G. Cholick, A. Lawrence Cholick and ~ oseph J. Cholick, were, for a number of years immediately preceding ~1ay 1, 1951, engaged in business as copartners under the name 'Vestern Training Service, with their office and principal place of business located at 206 Panama Building, Portland, Oregon. Respondents were engaged in the sale and distribution of courses of study and instruction intended for preparing students thereof Tor examination for certain Civil Service positions in the United States Government, such courses being pursued by correspondence through the medium of the United States mails. As indicated above, the business was discontinued in April 1951.

PAR. 2. In the course and conduct of their business, respondents caused their courses of study and instruction, when sold, to be transported from their place of business in the State of Oregon to purchasers located in various other States of the United States. During the period of time in question, respondents maintained a course of trade in their courses in commerce between and anlong various States of the United States.

PAR. 3. In promoting the sale of their courses of study and instruction, respondents used newspaper advertisements and also postal cards which were mailed to post office box holders and rural route box holders. \Vhen inquiries were received from prospective students, such inquiries were referred to traveling sales agents employed by respondents wIlo proceeded to call upon the pro::pe.cts and :::.olicit the purchase of the courses of study.

One of the principal issues raised by the complaint is whether respondents have exaggerated and misrepresented the opportunities ;;) WESTERN TRAINING SERVICE 773 766 Findings for obtaining positions in the United States Civil Service and whether respondents have wrongfully represented that persons taking respondents' courses of study and passing Civil Service examinations were assured of employment. The postal card used by respondents contained the statement "Men and Women vVanted to Prepare for Civil Service Jobs, Act Now " and the statement "Civil Service, Men "\Vomen 18 to 50, J\lany Opportunities. After listing numerous positions in the Civil Service, the card stated that these positions were but A Few of the Hundreds of Different JGnds of Positions." The card concluded with the statement "If you want to be ready to fiu one of the thousands of Government jobs that must be filled frolll time to time due to deaths, retirement, and normal Government expansion, fill in the attached card and mail at once. "The newspaper advertisements were in similar vein, stating that there were "thousands" of Government positions to be filled. Like the card, the advertisements listed a number of positions and then stated that there were "J\lany Others to Choose From." The enrollment agreement which persons purchasing the courses were asked to sign contained, under the caption "Continllous Training Until Appointed " the following: "Should I fail to pass the first examination taken, I am to receive, without further payment, coaching until I receive my appointment. Essentially the same representations .were made to prospective stn. dents by respondents: sales agents, ,yho stressed the availability of positions in the Civil Service and in at least some instances represented that persons purchasing respondents' courses and passing the Civil Service examinations were assured of appointment to positions. These representations were unwarranted and mislep,ding. While numerous vacancies may exist generally in the United States Civil Service, the taking of respondents' courses of study and passing a Civil Service examination does not assure employment, as employment is subject to veterans' perferences, the availability of eligibles in various Civil Service districts, and other conditions. J\foreover, examinations for numerous positions listed in respondents' advertising material may not be called for several years, and even though a student takes and passes an examination and his name is placed upon the eligible list, an appointment may not be made for a long period of time. Also, a number of positions are open only to veterans with 10 point preference.

Respondents also represented, both in their advertising material and through -their sales agents, that a common school or eighth grade education is usually sufficient to qualify for and obtain positions in the Civil Service. This representation was likewise erroneous and misleading. "\Vhile an eighth grade education may be sufficient for Order 48 F. T. C.

most of the lower grade positions in Civil Service, a high school education is required for many positions, and still other positions require additional special training, specific physical qualifications, or practical experience.

A further representation made in some instances by respondents sales agents to prospective purchasers was that the agent visited a given territory only once every two years ahd that unless prospective students enrolled at the time of the agent's visit, they would have to wait a period of two years before they would have another opportunity to enroll. There was no basis in fact for this representation, as pros- . pective students could enroll for respondents' courses at any time they desired .and were not required to wait two years or any other period of time.

PAR. 4. 'Vhile the complaint contained certain charges in addition to those discussed above, such additional charges are not sustained by the record.

PAR. 5. The acts and practices of respondents, as described above have the tendency and capacity to mislead and deceive a substantial portion of the purchasing public with respect to respondents' school and its courses of study and instruction and with respect to positions ill the United States Civil Service, and the tendency and capacity to cause such portion of the public to purchase respondents' courses as . a result of the erroneous and mistaken belief so engendered. CONCLUSION The acts and practices of respondents as hereinabove set out are all to the prejudice of the public and constitute unfair and deceptive acts and practices in conunerce within the intent and meaning of the Federal Trade Commission Act.

ORDER A. is o1'dered That the respondents Andrew G. Cholick, It Lawrence Cholick and Joseph J. Cholick, individually and as copartners trading under the name 'Vestern Training Service, or under any other name, and their representatives, agents and employees directly or through any corporate or other device, in connection with the offering for sale, sale and distribution in commerce, as "commerce is defined in the Federal Trade Commission Act, of courses of study and instruction, do forthwith cease and desist from representing, directly or by implication:

1. That persons completing respondents' courses and passing a Civil Service examination are assured of positions in the United States Civil Service.

WESTERN TRAINING SERVICE 775 766 Order 2. That an eighth grade education is usually sufficient to qualify for find obtain Civil Service positions, unless such representation be limited to positions in the lower grades.

3. That unless prospective students enroll for respondents' courses of study at the time of the visit of respondents' sales agent they will not beperiodpermitted to enrolloffor a periodtime.of two years or any other specified ORDER TO FILE REPORT OF COMPLIANCE I t is modered That the respondents herein shall, within sixty (60) days after 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 the order to cease and desist (as required by said declaratory decision and order of February 14, 1952). ..

Syllabus 48 F. T. C.