The D-Con Company, Inc.

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IN THE MATTER OF THE d-CON COMPANY, INC., ET AL.

DECISION AND ORDER IN REGARD TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSION ACT Docket 595S. Complaint, Ji'eli. 1!S, 1952-Decision, July, 1953 Where a corporation and its offcers, engaged in the manufacture, sale and distribution under the name " Con" of three rodenticide preparations, including a concentrate for mixing with bait, and " Con Ready Mixed" and Con s l\1house Prufe; in advertisements in periodicals and radio continuities- (1) Represented that " Con" was non-poisouous and completely safe and might be used without danger to buman bein/(s and domestic and farm animals; when in fact, while said products were not violent poisons and repeated doses for a period of days in large amounts would be required to endanger animals or humans, nevertheless, handled carelessly or by tbose wbo did not realize their poisonous nature, they constituted a serious danger to certain animals and humans;

(2) Represented that " Con" was "the ONLY rat and mouse kiler in the world that contains . . . special ingredient that the Vl\Tled Stales TESTf="G LABORATORIES has PROVED to be three times more effective; when in fact, composed of Warfarin mixed in a bait of freshly ground corn, it was no more attractive to rats than other freshly ground earn and not si/(nifieant1y more attractive than certain other rodenticides; (3) Represented that there were NO TBLL-TALE AFTER ODORS with CON" ; facts bein/( that it would not eliminate all after-odors caused by putrefaction of tbe carcasses of dead rats; (4) Represented that " Con s l\house-Prufe" was the "only mouse eliminator that contained Warfarin; when in fact there were other Warfarin-containin/( products designed for mouse control on tbe market when such statement was made on radio commercials; and (5) Represented that " Con" was Hthe lie\V scientific discovery reported in JR' S DIGEST" : when in fact tbe Reader s Digest article contained no reference to d-Con itself but was about 'Varfarin, principal ingredient in competing products as well as in d-Con ; Held: That such acts and practices were all to tbe prejudice and injury of the public and competitors, and constituted unfair and deceptive acts and praetices in cornrnerce and unfair methods of competition therein. Before ljl r. Webster' B aZlingcJ' hearing examiner. lJlr. Edward F. Downs for the Commission. lJ1r. Horace A. Young, of Chicago, Ill., for United Enterprises, Inc. Frank E. Arthur GettZcnwn of Chicago, Ill., for all other respondents.

DECISION OF THE COMMISSION AND ORDER TO FILE REPORT OF COMPLIANCE Pursuant to the provisions of the Federal Trade Commission Act the Federal Trade Commission, on February 28, 1952, issued and sub- , .

THE d-CON CO" INC., ET AL.

Findings sequently served its complaint in this proceeding upon the respondents The d-Con Company, Inc., and United Enterprises, Inc., corporations, and Leonard L. Ratner, Jerome S. Garland and Gerald H. Rissman, individually and as offcers of said corporations, charging them and each of them with unfair and deceptive acts and practices and unfair methods of competition, in commerce, in violation of the proanswers to said com-visions of said Act. Respondents filed their plaint, and hearings were thereafter held at whif'.h testimony and other evidence in support of and in opposition to the allegations of said complaint were introduced before a hearing examiner of the Commission theretofore duly designated by it, and said testimony and other evidence were duly filed and recorded in the offce of the Commission. Proposed findings as to the facts and conclusions were filed by counsel for respondents and counsel supporting the complaint. Thereafter on January 19, 1953, the hearing examiner filed his initial decision which was duly served on the parties.

Within the time permitted by the Commission s Rules of Practice both counsel for respondents and counsel supporting the complaint filed an appeal from said initial decision. Thereafter, this proceeding regularly came on for hearing by the Commission upon the record herein, including briefs in support of and in opposition to both appeals and oral argument of counsel, and the Commission issued its order denying the appeal of counsel supporting the complaint and granting in part and denying in part respondents' appeal; and the Commission being now fully advised in the premises, finds that this proceeding is in the interest of the public and makes the following findings as to the facts, conclusion and order to cease and desist, the same to be in lieu of the initial decision of the hearing examiner. INDINGS AS TO THE FACTS PARAGRAPH 1. Respondent The d-Con Company, Inc., and United Enterprises, Inc., are corporations, organized under the laws of the State of Illinois with their principal offees located at 112 East 'Walton Street, Chicago, Illinois. Respondent United Enterprises, Inc., is in process of liquidation, having disposed of all its assets prior to February 15, 1952, except a few bills receivable, and since said date has neither manufactured, advertised nor sold any merchandise. Respondent The d-Con Company, Inc., has been for some time past, and is now, actively engaged in business as hereinafter described. Respondents Leonard L. Ratner Jerome S. Garland and Gerald H. Rissman are President, Vice-President, and Treasurer, respectively, of The d-Con Company, Inc., their offces being that of The d-Con Company, Inc., and as such offcers they formulate and execute the Findings 50 F. T. C.

policies and practices of that corporation, Respondent Leonard L. Ratner was for a time, but is not now, President of United Enterprises, Inc.

PAR. 2, Respondents The d-Con Company, Inc" Leonard L. Ratner Jerome S. Garland and Gerald H. Rissman, are now, and for over two years last past have been, and respondent, United Enterprises, Inc. prior to February 15 , 1952, has been, engaged in the manuJ'acture sale and distribution of three rodenticide preparations, namely d-Con Con Ready Mixed and d-Con s ::lom:c- Prufe. d-Con Ready Mixed and d-Con s Mouse-Prufe contain a cereal bait and are ready for immediate use. d-Con is a concentrate which is to be mixecl with bait before nse. The formnlae and directions for use thereof are as follows:

Designation; u-CON formula; ACTIVE INGR mIENTS:

W ARF ARIN (3- (a-acetonyllJenzyl) hydroxy coullarin) - INERT INGREDIENTS- 99. 7% Direc:tions: Mix thorough!Jly eontents of t!Jis package with 5Y: lbs. of suitable semi-permanent bait mat rjal suell as fresh corn meal, rolled oats nut crumbs, dog food meal, poultry masb, etc. Place 2 oz. to I pound of mixed bait in locations frequented by rats and mice, and protect froin children, dogs, cats and livestoelc by means of bait boxes or cages where necessary. Baits should be replaced as consumed. Use no decomp0 , moldy or S011r lJaits. Cereal baits Drc 1l10re generally used. Estab1is!Jment and proper servicing of permanent protected feeding stations in areas where there is danger of l'cinfestation by rats and mice wil not: only control tbe rod('nts present but wil be avai1alJle to destror other l'a ts and mice as tlley invade the premises. For lics! TCSUlt8 maintain supplies of f"C8h bait at such stations at all times.

NOT/CB: Baitinl( slJOuld continue unti complete lad, of feeding is noted. This should take place in from five to fourteen days. CAU pion: CO:N contains as it.s active ingrcdipnt an anticoaguplant chemical, which, if taken acddental1y by humans, domestic animals and pets may reduce the clotting ability of the blood and a serions hemorrhagp IllUY result. In case baits fire flccidentally eatenlint/DOTE' gi\"e tablespoonful of salt in glass of \\"arm water and n,peat until vomit fiuid is clear. Call physician immediately. NoUc( t.o PhysiciaIls: 'Vhen a Inunnn has been known to have accidentally ingested c1-CO=' , blood transfusions combined \with intravenons injections and oral doses of Vitamin K are indicated as ill the case of hemorrhage caused by oyerdoses of dieumaro1. Designation: d-CO:' RK DY MIXED __ _ THE d-GON CO. , INC., ET AL.

'92 Findings orllula: ACTIVE INGREDIENT:

WARFARIN (3- (a-acetonylbenzyl) hydroxy coumarin) - 025% IKEHT INGREDIENTS___-- 99. 975% lJil'eetiollS: Substantially the same as those set out above for d-GON except as to the mixing.

Designation: d-GON' s MOUSE-PHUFE ol'Inula; ACTIVE INGREDIENTS:

W AHF'AHIN (3- (d-acetonylbenzrl) hydroxy coumarin) - --n 025% INERT INGHEDIENTS- 99. 975% Directions: Substantially the same as those set out above for d-GON except as to the mixing.

Warfarin is an anticoagulant compound developed in 1948 by Dr. Karl Paul Link and his associates in the laboratories of the University of 'Wisconsin, Patent to this compound is held by the 'Wisconsin Alumni Research Foundation which licenses respondents, among others, to manufacture and sell said compound. The use of vVarfarin represents a completely new practical approach to rodent control. Products containing this compound differ from all previously used successful rodenticides in two respects. It kills effectively only when consumed repeatedly, and it produces no acquired bait shyness in the rodents being poisoned. It causes death by producing internal bleeding.

PAR. 3. The respondents, with the exception of respondent 1 united Enterprises, Inc., since FebruaJ'y 15 , 1952, have caused and now cause their said products, when sold, to be transported from their places of business in the State of Illinois to purchasers thereof located in various other States of the United States and in the District of Columbia, and have maintained and now maintain a, course of trade in said products in commerce among and between the various States of the United States and in the District of Columbia. Their volume of trade has been, and, with the exception of respondent United Enterprises, Inc. is now, substantial.

PAR. 4. In the course and conduct of their sa.id business all of the respondents, with the exception of respondent United Enterprises Inc., are now, and respondent United Enterprises, Inc., prior to February 15 , 1952, was, engaged in substantial competition in commerce with other corporations, ilrms, and individuals in the sale of rodenticide products.

PAR. 5. In the course and conduct of their said business and for the purpose of inducing the purchase of their products in commerce, as commerce' '' is defined in the Federal Tra.de Commission Act, respond- Findings 50 F.

ents have disseminated and caused the dissemination of certain advertisements in periodicals and radio continuities containing the staterespectively.ments set out hereafter and lettered (a) through (h), For clarity of discussion each advertising claim alleged to be false discussed separately asand the facts of record relating thereto are follows:

(a) Respondents' Statements:

CON is safe, clean, easy to use CON, made with WARFARIN can now eliminate al1 rats and mice from your property, completely and permanently without endangering tbe life of your family or animals. In a recent test made on a University Experimental Farm a chicken was fed enough W ARF ARIN to ki1 9 000 rats. After 14 months of daily feeding, the cbicken was stil alive and doctors examinations indicated that not one bit of damage was done to the chicken, either internally or exterharmlessness of D-CON tonally-or to the eggs. Certainly this test proves the farm animals.

Alleged False Meaning:

That d-CON is non-poisonous and completely safe and may be used without danger to human beings and domestic and farm animals. Facts Relating Thereto:

Hespondents' advertisements of their said products taken in their entirety show that they are intended to control rats by poisoning them. They clearly reveal the poisonous nature of these products. Therefore, the allegation that respondents' claim their product is nonpoisonom, :s not sustained by the record.

However, the above-quoted advertising claims imply that, although poisonous, d-Con is not suffciently poisonous to human beings and animals to endanger their lives. In fact, if humans or certain domestic animals ate a quantity of respondents' products for a period of several days, the clotting ability of their blood might be reduced to such an extent that serious internal bleeding would result. The package in which d -Con is sold contains the following legend: CA UTI ON: d-CON contains as its active ingredient an anti-coagulant cbemical, whicb, if taken accidental1y by humans, domestic animals and pets may reduce the clotting ability of the blood and a serious hemorrhage may result. Respondents' said products are not violent poisons. Repeated doses for a period of days in relatively large amounts would be required to enchmger animals or humans. Adequate instructions for handling these products with safety are set out on the packages in which they are sold. These products, if handled in accordance with directions by persons realizing they are handling a poison, would not constitute any serious danger. However, handled carelessly or by persons not realizing they are poisonous, these products would constitute a serious THE d-CON CO., ING., ET AL.

Findings Langer to certain animals and humans. To this extent the allegations If the complaint as to these advertising claims are sustained by the vidence.

(b) Respondents' Statements:

Yes, the new W ARF ARIN formula, developed by the U of Wisconsin, and now leing sold eommerciaJly as D-GON, is tbe only RAT and MOUSE kiler ever lis covered that wil rid your property of aU rodents within 15 days, and wil reep it FREE of these destructive pests. . . J;'OREVER! * * * if you use GON as directed, you U never have another RAT or MOUSE ON YOUIt PROP- B;RTY . . . FOREVER! . * * Then, use D-GON as directed. , at the end of 15 days you have a SINGLE HAT or MOUSE on your property, return tbe empty can for a fuU $2.98 refund. Alleged False Meaning:

That d-GON wil destroy aU rats and mice on a property within 15 days and wil thereafter keep such property free from rats and miee. Facts Relating Thereto:

By the use of these statements in their advertising, respondents have represented that if you use d-Con as directed, it will rid your property of all rodents within 15 days, and will keep it free from these destructive pests forever. The record shows that rats eating 1 to Ph mg. of the preparation over a period of five days will usually die by the seventh day. Expert testimony in the record shows that there are situations, such as where more attractive other food is readily available, where the time required to kill the rats may extend beyond 15 days and the extent of the elimination may not reach 100 percent. However, evidence in the record, including evidence of actual tests with d-Con on badly infested areas, indicates that such situations are relatively rare. The greater weight of the evidence of record will not support a finding that respondents' preparation, used as directed, wil fail to rid a property of all rodents within 15 days in any substantial number of cases; nor will it support a finding that its continued use as directed will fail to keep the property free of rodents in any substantial number of cases. Respondents have attempted to provide for those cases, which the record indicates are relatively rare, where the use of their product as directed wil not result in 100 percent extermination in 15 days, by offering to refund the purchase price. raking into consideration all of the circumstances as shown by this record, the Commission is of the opinion that the public interest does not require any corrective action as to these representations, and that the allegations as to them have not been sustained. (c) Respondents' Statement:

* * * D-GON the ONLY rat and mouse kiner in the world that contains both warfarin, the University of 'Visconsin s NE'V. ACCLALMRD discovery, and 403443-57- Ji'indings 50 F. T. C.

LURIcX-a special ingredient that the UNITED STATES TES'J'ING LAI30RA- TORlF,S has PROVED to be three times more effective. A alleged False fl eaming That. d-CON contains a special attractant that is three times more successful or luring than any other rodenticide bait or regular feed. Facts Relating Thendo:

Respondents' said advertising claim has the meaning alleged. Con is a rodenticide composed of 'Warfarin mixed in a bait of freshly ground corn. The evidence establishes that it is no more attractive to rats than other freshly ground corn and that it is not sif,J"nificantly more attractive than certain other rodenticides. The allegation that his advertising claim is false and deceptive is sustained by the evidence. (d) Respondents' Statement:

NO TJ LL-TALE AFTER-ODORS with d-CON Alleged False 111 meaning: That d-CON wil eliminate a11 after-odors usually associated with tbe use of 1'oden tieiues.

Facts Iielating Thereto:

Respondents' said advertising claim has the meaning alleged. fact, however, d-Con will not eliminate odors caused by putrefaction of the carcasses of dead rats, which is the after odor associated by the public with the use of a rodenticide. This representation, therefore is I'alse and deceptive as alleged.

(e) Respondents' Statement:

That' s why the D-CON formula is recommended by the U. S. Public Health Service and the U. S. Fish and Wic11fe Service Alleged False Meaning:

That d-CON has been recommended by the United States Public I-Iea1tll Service ,md the United States Fish and Wildlife Service. Fa.cts Relating Thereto:

The said statement does not have the meaning alleged. It clearly states that the cl-Con formula had been so recommended not d-Con. The record SI1O\\"S that this statement is true. Both the United States Public Health Service and the 17united States Department of Interior Fish and 'Wildlife Service, in published bulletins, have recommended the noc of ,Varfarin with a cereal type bait for rodent control. A bulletin of the latter agency recommends the use of a 0.025% concentration of ,Vadm'in with a cereal type bait. This is the exact formula and concentration of ready mixed d-Con and d-Con s Mouse-Prufe. This allegation, therefore, is not sustained by the evidence. (g) THE d-CO:\ CO. , INC. , .ldt AL.

Findings (f) Respondents' Statement:

infested with rats and mice. MWdleton, vVisconsin, for rears was very badly J\:lany women and children \were afraid to go out because of this great infestation. In order to prove the effectiveness 01" d-CON, the ;\liddleton eivie organi. zations, in eo operation with and at the expense 01" d-CON Company, set out bait stations on November 4th throughout the entire townsbip. By November 19th, there were no longer any si/(ns of rats in the entire city! NO ONID HAS OF A HAT em IOUSE SL'K' Thnnks to d-CONSEIDN A SIKGLE SIGN Middleton is rat FREE! Alleyed False 11 caning:

That an rats and mile infesting a town will be eliminated by the use of d-CON and that such town will l'elnain free frolll reinfestation by rats and mice. Facts Relating Thereto:

This statement does not represent that all towns can be made permanently rat and mousc free through the use of d-Con. This advertisement used as part of a radio continuity from.J anuary 2nd through 5th 1951, stated that after using d-Con in a campaign against rats and mice in Yliddleton, ,,yisconsin, which campaign closed November 19 1950, the town was stil free of rats and mice. The only evidence tending to disprov( this claim was a showing that one year after the cmnpaign closed 01\8 live monse and some rat burrows were found in an inspection of the to \\1. Such evidence does not prove this claim to be false, especially lS there was no sllOwing of continued nse 0f Con throughout the town after the close of the campaign. Respondents' actual claims for permanwlt control of rats and mice apply only to restricted areas where d-Con s use is continued as directed. Therefore, the allegation as to the falsity of said advertising claim has not been sustained by the evidence.

Respondents' Statement:

Yes, d-CON' lonse-Prufe is the only 1110U88 elilninaiol' that contains 'Var farin * * * Alleged False Meaning:

That d-CON' s YIouse-Prufe is the only rodenticide on the market for ki1ing mice that contains the ingredient Warfarin. Facts Relating Then to:

Respondents' statement has the meaning alleged. Said statement was made hy respondents in radio commercials during the period from June 12th through 19th, 1951. The record shows that there were other 1Varfarin containing products designed for mouse control on the market at that time. Therefore, this advertising claim was false and deceptive.

Order 50 F.

(h) Respondents' Statement:

WIN THE WAR ON RATS AND MICE with d-CON, The new scientific discovery reported in HEADER' S DIGEST.

Alleged False 11 meaning: That d-CON was tbe subject of a report or article appearing in the publieation "Reader s Digest."

Facts Relating Thereto:

Respondents' statement clearly implied that d- Con was the subject of an article in the Reader s Digest. In fact, the article was about Warfarin, the principal ingredient in competing products as well as in respondents' d- Con. The article contained no reference to d-Con itself. Therefore, the advertising claim was false and deceptive. PAR. 6. The use by respondents of the false, misleading and deceptive statements set out in subparagraphs (a), (c), (d), (g), and (h) of Paragraph 5 of these findings has the tendency and capacity to mislead and deceive a substantial portion of the purchasing public into the erroneous and mistaken belief that such statements are true, and has the tendency and capacity to cause such portion of the public to purchase substantial quantities of rodenticides from respondents rather than from their competitors because of such erroneous and mistaken belief.

CONCLUSJON The acts and practices of respondents, referred to in the above and foregoing Fi ndings as to the Facts, subparagraphs (a), (c), (d), (g), and (h) of Paragraph 5 were all to the prejudice and injury of the public and of respondents' competitors and constituted unfair and deceptive acts and practices and unfair methods of competition, in commerce, within the intent and meaning of Section 5 of the Federal Trade Commission Act.

The acts and practices set forth in the foregoing Findings as to the Facts, subparagraphs (b), (e), and (f) of Paragraph 5 were not in violation of Section 5 of the Federal Trade Commission Act. ORDER It is ordered That The dc-Con Company, Inc., a corporation, and its officers, and Leonard L. Hatner, Jerome S. Garland and Gerald H. Hissman, individually and as offcers of said corporation, and respondents' representatives, agents and employees, directly or through any corporate or other device, in connection with the offering for sale, sale or distribution in commerce, as "commerce" is defined in the Federal Trade Commission Act, of the rodenticide preparations designated THE d-CON CO. , INC., ET AL. 101 Order CON" and " CON' s MOUSE-PRUFE " in whatsoever form sold or any other rodenticide and substantially similar composition or possessing substantially similar properties, whether sold under either of said names or under any other name or names, do forthwith cease and desist from representing directly or by implication: 1. That any of said preparations are safe or may be used without danger to human beings or domestic or farm animals, unless qualified by the words "when used as directed" or other words of like meaning. 2. That any of said preparations contain a special attractant that is more successful or alluring than all other rodenticide baits or regular feed.

3. That any of said preparations will eliminate all after-odors usually associated with the use of rodenticides. 4. That any of said preparations is the only rodenticide on the market for killing mice that contains the active ingredient "\Varfarin. 5. That the preparation d-Con was the subject of a report or article appearing in the publication "Reader s Digest." It is further ordered That the allegations of the complaint relating to the representations set forth in subparagraphs (b), (e), and (f) of Paragraph 5 of the Findings as to the Facts be, and the same hereby are, dismissed as not having been sustained by the evidence. It is lurther ordered That the case growing out of the complaint herein be, and it hereby is, closed as to the respondent United Enterprises, Inc., a corporation, without prejudice to the right of the Commission to reopen the sanie and to proceed further against said corpo- Tation in the event its dissolution should not become final. It is lurther ordered That respondents The d-Con Company, Inc. Leonard L. Ratner, Jerome S. Garland, and Gerald H. Rissman 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.

Syllabus 50 F. T. C.