Harry A. Burch

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

IN THE l\iatter OF HARR Y A. BURCH DOING BUSINESS AS "VESTERN TRAIN- ING SERVICE AND NATIONAL TRAINING SERVICE COMPLAINT, FINDINGS, .AND ORDERS IN REGARD TO THE ALLEGED VIOLATION OF SEC. 5 OF AN ACT OF CONGRESS APPROVED SEPT. 26, 1914 Docket 5827. Complaint, No.v. 1950-Decision, Peb. 1.4, 1952 Where an individual engaged in the interstate sale and distribution of correspondence courses to prepare students for examillation for certain Qi- Service positions- (a) Falsely represented through statements on printed postal cards, circulars, newspapers, and other advertising media, and through sales agents and a sales guide with which he supplied them, that his school was a branch of, or connected with, the Government or the Civil Service Commission; (b) Represented that many positions were vacant, that men and women were needed to fill such vacancies, and that such positions might be obtained through his school; and (c) Represented as aforesaid, including statelllell ts on postal cards distributed to holders of rural post office boxes, that men and women were wanted to prepare for various Civil Service examinations, including customs, immigration and border patrol positions, and tl1rough such statements created the impression that such postal cards were official announcements of the Civil Senice Commission;

The facts being that said commission does not advertise for persons to prepare for examinations or to :fill Government positions; said individual had no power or authority to place any pel':-;Oll in any Civil Service position; and while many vacallcies may exist generally in the Civil Service, the taking of his course of study and the passing' of a Civil Service examination would not assure employment, due to veterans' preferences, availability of eligibles in different Civil Service districts, and other contingencies; (d) Falsely represented that the remuneration in Civil Service positions was better than the average salaries or W:lges obtainable in comparable positions in private industry; and Where said individual, engaged as aforesaid- (e) Represented through his said traveling sales agents, that an eighth grade education was sufficient to qualify for and obtain the positions concerned; the fact being that while such an education may suffice for most of the lower grade positions, a high school education is required for many, and still others require additional special training, specific physical qualifications, or practical experience;

(f) Falsely represented that persons employed in the United States Civil Service are pensioned on two-thirds of their salaries; the facts being that the amount of retirement paid depends in each case upon the length of service and other factors;

(g) Falsely represented that unless students enrolled at the time of the sales agent' s visit they would not be permitted to enroll for a period of two years; when in fact they were free to enroll at any time; NATIONAL TRAINING SERVICE, ETC. 777 776 Complaint (h) In certain instances furthered the false implication that said school was connected with or authorized by the Government and that such agents had some official capacity or authority, through exhibiting to prospective purchasers a book entitled "Reference Manual of Government Positions; and (i) Represented falsely that it was necessary that prospects take the courses of study offered in order to qualify for Civil Service positions, and that informationsuch agents were requiredforby prospects;the Civil Service to obtain. certain preliminary With tendency and capacity to mislead and deceive a substantial portion of the purchasing public into the belief that such representations were true, and thereby induce its purchase of said courses of study: Hew That such acts and practices, under the circumstances set forth, were all to the prejudice of the public, and constituted unfair and deceptive acts and practices in commerce.

while the complaint also raised an issue as to respondent's trade name, National Training Service, which it charged as misleading in itself as representing or iniplying a Government connection, and a stipulation of facts contained a statement to the same effect: there appeared little likelihood that the name itself, apart from other representations as to Government connection would be misleading to the public, and it was accordingly concluded that an order prohibiting its use would not be warranted. Before 1/11'. lij1illia1n L. Pack hearing examiner. Air. lVillimn L. Pencke for the Commission. . lIla'll1'2ce I(adish of Seattle, 'Vash. , for respondent. COMPLAINT Pursuant to the provisions of the Federal Trade Commission Act and by virtue of the authority vested in it by said .A.. , the Federal Trade Conw1issioll having reason to believe that Harry A. Burch, an individual, doing business under the names of"\V estern Training Service and National Training Service. hereinafter referred to as respondent, has violated the p1'ovisions of the said Act, and it appearing to the Commission that a proceeding by it in respect thereof would be in thethatpnblicrespectinterest, herebyasissuesfollmvs:its complaint, stating its charges in PARAGR.c\.PH 1. Respondent. Harry A. Burch, is an iIidividual, trading and doing business under the names of vVestern Training Service and National Training Service, with his ofilce and principal place of business at 1314 East 43rd Street, in the city of Seattle and State of"\Yashington.PAR. 2. For more than two ye,ars last past, respondent has been and is now engaged in the sale and distribution in commerce between and among the various States of the United States of courses of study and instruction intended for preparing students thereof for examination for certain Civil Service positions under the United States Govern- Complaint 48 F. T. C.

ment, which said courses are pursued by correspondence through the medium of the United States mails. Respondent, in the course and conduct of said business, causes his f-;aid courses of study and instruction to be transported fronl his said place of business in the State of \Vashington to, into and through States of the United States other than \Vashington to the purchasel's thereof in such other States. There has been at all times mentioned herein a course of trade in said courses of instruction so sold and distributed by respondent in commerce between and among the various States of the United States, and said course of trade has been and is, substantial. PAR. 3. In connection with the sale of said courses of study and instruction respondent has made and i:3 making use of printed advertising matter distributed to prospective students thrOlighout the central and western States, and of advertisements in newspapers circulated in said States, in and by which numerous representations have been and are made in regard to said courses of study and matters and things connected therewith. Typical of such representations are the following:

CIVIL SERVI CE JOBS (~IEN AND WOMEN 18 TO 50) Offer YOU: Better than average pay! PERMA~ENT SECUHITY! AU~rO- 1\:1A'1' IC PAY INCREASES!! AUTOMATIC PROMOTIONS! '1'WO WEEKS on MORE ANNUAL VACATION WITH PAY! AJ.,NUAL SICK LEAVE 'WITH PAY! 40-HOlTR 'YEEK! TEN PER CDX'l' EXTRA FOR NIGHT WORK! HIGH RE'rIRED PAY AS LO~G AS YOU LIVE WHEX YOU REACH RETIRI~- MENT AGE! The above advantages go with all jobs in the PERMANENT CL.A:S. SIFIED CIVIL SERVICE. '1'0 be able to get one of these jobs you must PASS . CIVIL SERVICE COMPETITIVE EXAMINA'I'ION. '1'TRAINING YOU TO PASS THESE EXAMINATIONS IS OFR BUSINESS!!! Time required is short. The COST IS LOW! The TER~lS ARE EASY! WESTERN TRAINING SERVICE MEN and WOMEN WANTED RURAL STAR ROUTE AGES 18 to POST OFFICE BOXHOLDER To Prepare For LOCAL - CIVIL SERVICE JOBS GOOD SALARIES & PERMANENT JOBS FOR LIFE . .. .

NATIONAL TRAINING SERVICE, ETC. 779 776 Complaint :MEN and WOl\IEN tV ANTED Ages-1S- TO PREPARE FOR CIVIL SERVICE EXAl\IINATIOXS Railway Postal Clerk-Po O. Cieri;:, Carriers- Customi;- Imll1igra tion- Internal Revenue- Clerks, Inspectors-Border Patrol Contact Represen ta ti yes CIVIL SERVICE OFFERS: Permanent Employment. Promotions, Vacations, Sick Leave, Pensions MFNI CIP AL-ST ATE-FEDERAL For full details find qualifications, fill in completely, detach and mail attached 110St card AT ONCE-No Postage Necessary.

PAR. 4. By means of the foregoing statements and representations and others to the same effect not herein set out and by the use of the trade name National Training Service, respondent represents and implies that his said school is a branch of or connected with the United States Government or the U. S. Civil Service Commission; that many positions in the United States Civil Service, including those specifically named in saiel advertisements are vacant, that men and women are needed to fill said vacancies and that said positions may be obtained through respondent's "\Vestern Training Service or N ational Training Service; that men and women are wanted by the United States Government to prepare for civil service positions; and that the, remuneration in civil service is better than the average wages pai(1 in comparable jobs.

PAR. 5. Respondent furnished his salesmen with a so-called "Sales Guide" containing suggestions and directions for conducting interviews with prospective purchasers of said course. Among the statements directed by respondent to be made as aforesaid are the following:

~lr. Doe, you wrote ill about Civil Senice . . . 'Ibe reason that I l1ave called to talk to ~' ou about Chon Sen-ice is that you could have but one arm or a leg find we would not know anything about it. . . There are a few personal quf'stions I have to nsl;: you. I do not like to, but it is required by the Civil Preparation ~ervice . . . -if you cannot pass us, you could not pass the government. . .

I am going to give you a little Civil Senice to see holv ~' OU would mal;:e out. In Civil Service no one knows how high they can go . . . At the time of retirement, . . . they say "You have done your work well, Go home find we will pay yon just the same, and that is two-thirds of your pay the rest of your life The very important part about our qualifications are selecting people who 780 FEDERAL TRADE COI\iI\lission DECISIONS Complaint 48 F. T. C..

have a decisive mind. This is the last call I can make for a period of two years. . .

By means of said sales talk and other oral statenlents and representations made by his sales age11ts, respondent represents and implies to prospective students and purchasers of his said courses of instruction that said ",Vestern Training Service and National Training Service are connected with the United States Government or the United States Civil Service Commission in some official capacity; that enrollees pursue and complete respondent's course of study, they will be assured of a job in the U. S. Civil Service and that it is necessary to take said course of instruction in order to qualify therefor, and that said salesmen are required by the Civil Service to obtain preliminary information; that many vacancies exist in the U. S. Civil Service and that respondent can place his students in such positions; that an eighth grade education is sufficient to qualify for and obtain most of said positions; that persons employed in the United States Civil Service are pensioned on two-thirds of their salary; and that unless students enroll at ithe time of the salesman s visit, they will not be able to do so for a period of two years.

Through statements on postal cards distributed to holders of rural newspaper and post office boxes respondent represents that men and women are wanted to prepare for civil service examinations, including customs, immigration and border patrol positions, which statements coupled with the trade name National Training Service, create the impression that said cards are official announcements of the U. S. Civil Service Commission.

By means of exhibiting a book entitled "Reference :Manual of Government Positions " to prospective purchasers, respondent's salesmen further the impression and implicntion that respondent's school is connected with, or authorized by the United States Government and that said salesmen are clothed with some official capacity or authority. PAR. 6. All of said statements, representations and implications are grossly exaggerated, false and misleading. In truth and in fact, there is no connection whatsoever between the respOlident or his salesmen and the United States Government or any agency thereof. The United States Civil Service Commission doef; not advertise for men and women to prepare for civil service examinations or to fill Government positions. Respondent has no po,ver or authority to place any person any ci~il service position. Neither respondent nor his salesmen have been authorized by any Government agency to qualify applicants for civil service examinations or positions, or obtain preliminary data. is not necessary to purchase respondent's courses of instruction in NATIONAL TRAINING SERVICE, ETC. 781 776 Complaint order to take civil service examinations and obtain positions in civil service.

"\Vhile many vacancies may exist generally in the U. S. Civil Service the taking of respondent's course of study and passing an examination does not assure immediate employment, for the reason that such employment is subject to veterans' preferences, the availability of eligibles in various civil service districts, and other conditions. :Moreover, examinations for numerous positions listed in respondents s sales, literature may not be called for several years, and even if 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 time; and number of positions are open only to ten-point veterans. 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 additional special training, specific physical qualifications or practical experience.

The wages and salaries paid to Civil Service employees are not higher than the average wages and salaries pre-vailing for comparable positions in private industry. U. S. Civil Service elnployees are not pensioned at two-thirds of their salaries, the amount of retirement paydepending in each case upon the length of service and other specificprovisions pertaining to the retirement of Government employees. If prospective purchasers of said courses of study do not decide to enroll at the time they are solicited by respondent' s salesmen, they may enroll at any time subseque.nt to such visit and are not required to wait for a return visit by said salesmen two years after the first call. Respondent' s use of the name National Training Service in connection with the sale of courses of study for U. S. Civil Service examinations, creates the impression and implication that said National Training Service is connected with or a part of the U. S. Civil Service. truth and in fact, it is a private business, operated for profit by re., spondent.

PAR. 7. The use by respondent of the statements and representationsaforesaid, has had and now has the tendency 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 respondent's courses of study and instruetioll in said commerce on account thereof. PAR. 8. Th~ aforesaid acts and practices of respondent, as herein alleged, are all to the prejudice and injury of the public and constitute. unfair and deceptive acts and practjces in commerce within the intent and meaning of the Federal Trade Commission Act. Findings 48 F. T. C.

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 Hearing Examiner 1Villiam L. Pack, as set out as follows, became on that date the decision of the Commission.

INITIAL DECISION BY WILLIAl\f L. PACT\. HEARING K~AMINER Pursuant to the provisions of the Federal Trade Commission Act the Federal Trade Commission on November 2, 1950', issued and subsequently served its complaint in this proceeding upon the respondent Harry A. Burch, individually and doing business under the names 1Vestern Training Service and National Training Service, charging him with the use of unfair and deceptive nets and practices in commerce in violation of the provisions of that ~\..ct. After the filing by respondent of his answer to the complaint a hearing was held before the above-named hearing examiner, theretofore duly designated by the Commission, at which hearing iT stipulation of facts was entered into between counsel supporting the complaint and counsel for respondent, and certain testimony and other evidence were also introduced at the hearing. Such stipulation, 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, stipulation of facts, (such stipulation having been approved by the hearing examiner) and testimony and other evidence (counsel having elected not to 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 P ARAGRA.PH 1. The respondent, Harry A. Burch, is an individual trading and doing business under the name National Training Service, with his office and principal place of business located at 1314 East 43rd Street, Seattle, 1Vashington. Respondent formerly used also the trade name1V estern Training Service, the llse of this llnme having been discontinued by him some two years ago. Respondent is now and for a number of years last past has been, engaged in the sale and NATIONAL TRAINING SERVICE, ETC. 783 776 Findings distribution of courses of study and instruction intended for preparing students thereof for 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. PAR. 2. In the course and conduct of his business respondent causes and has caused his courses of study and instruc~ion, when sold, to: be transported from his place of business in the State of "\Vashington to purchasers located in various other States of the United States. Respondent maintains and has maintained a course of trade in such courses in commerce between and among various States of the United States.

PAR. 3. Inpromoting the sale of his course of study and instruction respondent makes use of printed postal cards, circulars and other advertising media and also of advertisements inserted in newspapers, all of which are disseillinated among prospective purchasers. By means of various statements appearing in such advertising material, respondent represents that his school is a branch of or is connected with the United States Government or the United States Civil Service Commission; that many positions in the United States Civil Service including certain postions specifically named in such advertising material, are vacant, that lnen and women are needed to fill such vaeancies find that such positions may be obtained through respondent' s school; that inen and women are wanted' by the United States Government to prepare for Civil Service positions; and that the remuneration in Civil Serviee positions is better than the average salaries or wages obtainable in comparable positions in private industry. Respondent also' uses traveling sales agents to contact prospective students and such agents are supplied by respondent with a sales guide which contains suggestions and instructions for conducting interviews with prospects. Through the use of such sales guide and of other statements made by his sales agents, respondent represents to prospective students that his school is connected with the United States Government of the United States Civil Service Commission in some official capacity; that if enrollees pursue and complete respondent' courses of study they will be assured of a position in the United States Civil Service, and that it is necessary that prospeets take such courses nf study in order to qualify for such positions; that such sales agents are required by the United States Civil Serviee to obtain certain preliminary information from prospects; that many vacancies exist in the United States Civil Service., and that respondent can place his students in such positions; that an eighth grade edueation is sufficient to qualify for and obtain most of such positions; that persons employed in the United States Civil Service are pensioped on two-thirds of their 213840-54- 784 FEDERAL TRADE COML\nSSION DECISIONS Findings 48 F. T. C.

salary; and that unless students enroll at the time of the sales agent' visit they will not be permitted to e.nroll for a period of two years. By means of statements ~1 postal cards distributed to holders of rural post office boxes, respondent further represents that men and women are wanted to prepare for various Civil Service examinations including customs, immigration and border patrol positions, and such statements create the impression that such postal cards are official announcements of the United States Civil Service Commission. By exhibiting to prospective purchasers a book entitled "Reference :Manual of Government Positions " respondent's sales agents have. in certain instances furthered the impression and implication that respondent' s school is connected with or authorized by the United States Government and that such sales agents have some official capacity or PAR. 4. All of these representations are erl'OneOlls and misleading.authority. 'Respondent and his sales agents have no connection whatever with the United States Government or any agency thereof. The United States Civil Service Commission does not advertise for persons to prepare for Civil Service examinntioJls or to fill Government positions. Respondent has no power or authority to place any person in any Civil Service position. Neither respondent nor his snJesmen have been authorized by any Government agoney to qualify applicants for Civil Service examinations or positions or to obtain preliminai'y or other data from such persons. It is not necessary to purchase respondent' s courses of study in order to take Civil Service examinations and obtain Civil Service positions.

'Vhile many vacaneies may exist generally in the Uniteel States Civil Serviee, the taking of respondent's course of study and passing Civil Service examination does not assure employment, as employment is subject to veterans' preferenees, the availability of eligibles in various Civil Service districts, and other conditions. :Moreover, examinations for numerous positions listed in respondent's sales literature may not be ealled for several years, and even if a student takes and passes an examination and his name is placed upon the eligible list an appointment may not be made Jor a long period of time, and a number of positions are open only to veterans with ten-point. preferenee. ",Vhile un eighth grade edueation may be sufficient for most of the lower grade positions in Civil Serviee, a high school education require addi- is required for many positions, and still other positions or practicaltional special training, specific physical qualifieations,experience.Salaries and wages paid Civil Service employees are not higher than the average salaries and wages prevailing in comparable positions in NATIONAL TRAINING SERVICE, ETC. 785 776 Order private indl,lstry. Civil Service employees are not pensioned at two"' thirds of their salary, the amount of retirement pay depending, in each case, upon the length of service and other specific provisions pertaining to the retirement of Government employees. If prospective purchasers of respondent's courses of study do not decide to enroll at the time they are solicited by respondent' s salesman they may enroll at any time subsequent to such visit and are not required to wait two years or any other period of time. PAR. 5. The acts and practices of respondent, as described above have the tendency and capacity to mislead and deceive a substantial portion of the purchasing public with respect to respondent's school and its courses of study and instruction and with respect to positions in the United States Civil Service, and have the tendency and capacity to cause such portion of the public to purchase respondent's courses as a result of the erroneous and mistaken belief so engendered. CONCLUSIONS The acts and practices or respondent, as hereinabove set out, are all to the prejudice of the public and constitute unfair and deceptive acts and practices in commerce within the intent and meaning of the Federal Trade Commission Act.

The complaint also raises an issue as to respondent's trade name National Training Service, charging that the name itself is misleading as representing or implying that the school is connected with th8 United States Government. While the stipulation of facts contains a. statement to the same effect, the hearing examiner questions whether such position is sound. There would appear to be little likelihood that the name itself, apart from other representations as to Government connection, would be misleading to the public. It is therefore concluded that an order prohibiting the use. of the trade name would not be warranted.

ORDER I t is ordel' That the respondent, Harry A. Burch, individually and doing business under the names vVestern Training Service and National Training Service or any other name, and his' 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 respondent's school has any connection with the United States Government or any agency thereof.

Order 48 F. T. C.

2. That persons completing respondent's courses are assured of necessary thatpositions in the United States Civil Service, or that it is persons take such courses in order to qualify for such positions. 3. That salaries or wages obtainable in Civil Service positions are higher than those obtainable in comparable positions in privateindustry.4. That respondent's sales agents are authorizecr by the United States Civil Service Conlillission to obtain any information from purchasers or prospective purchasers of resl)ondent's courses', or that such sales agents have any connection whatever .with said Commission. 5. That an eighth grade education is sufficient to qualify for and obtain most Civil Service positions, unless such representation limited to positions in the lower grades.

6. That persons employed in the United States Civil Service receive pensions or retirement allllli.ities amounting to two-thirds of their salary.

7. That unless prospective students enroll for respondent's courses at the time of the visit of respondent's sales agent they .will not be permitted to enroll for a period of two years or any other specified period of time.

ORDER TO FILE REPORT OF CO~IPLIANCE I t is ol'del'ed That the respondent 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 eomplied with the order to cease and desist (as required by said declaratory decision and order of February 14, 1952). RENE D. LYON COMPANY, INC., ET AL. 787 Order