S. S. Sawyer, Inc.

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IN THE MATTER aF S. S. SAWYER, INC.

DECISION IN REGARD TO THE ALLEGED Violation OF SEC. 2' (C) OF THE CLAYTaN ACT, AS AMENDED Docket, 6103. Complaint, June 17, 1953-Decision, Oct., 1953 Where a evrporation engaged in the sale of potatoes, among other vegetables, to three principal kinds of buyers, namely, (1) agents to whom, as compensation for services rendered it paid a brokerage fee ranging from about 51 to about 10(, per rwt. or equivalent amounts; (2) "buying agents, who also purchased for their own account for resale; and (3) other buyers, including some chain store organizations and food processors- (a) Paid to buying agents in connection with the sale of potatoes to them for their own account, a fee as brokerage, in the same manner as it paid a bro- Iwrage fee to them and to other agents for sales to buyers effected through them and in the same or substantially the same amounts; (b) Charged direct buyers, including some chain store organizatious and food processors, prices which were lower than those charged other buyers purchasing at or about tbe same time, by amounts which were the same or substautially the same as the brokerage fees that it paid to its agents for effecting sales to buyers purchasing through them:

Held, That in paying such brokerage fees and in charging lower prices as above set forth to such buying agents and direct buyers, it viola.ted subsec. (c) of Sec. 2 of the Clayton Act as amended.

Before Mr. Ja118 A. Purcell hearing examiner.

Mr. Peter J. Dias and Mr. Rickard E. Ely for the Commission. Ooxe db Stephens, af St. Augustine, Fla. far respondent. DECISION OF THE COMJllISSION Pursuant to. Rule XXII af the Commission s Rules af Practice, and as set forth in the Commission s "Decision of the Commission and Order to. File Report af Campliance " dated October 1, 1953, the initial decision in the instant matter af hearing examiner James A. Purcell as set aut as fallaws, became an that date the decision af the Commission.

INITIAL DECISLON BY J AJl1ES A. PURCELL, HEARING EXAMINFJl Pursuant to. the provisions af an Act of Cangress entitled "An Act to. supplement existing laws against unlawful restraints and monopolies, and for other purposes " approved October 15, 1914 (the Clay tan Act), as amended by the Rabinson-Patman Act, approved June 19 1936 (15 U. S. C., Sec. 13), the Federal Trade Cammissian an .June Findings 50 F. T. C.

1953, issued and subsequently served its complaint in this proceeding upon S. S. Sawyer, Inc., a corporation, charging it with violation af subsection (c) af Section 2 af said Act as amended. Subsequent to the service of ample notice to. all parties in canfarmity with law, a hearing far the taking af testimony and the receptian af evidence was held in "Washington, D. C. , an the 18th day af August 1953. The respondent having failed to. file its answer to the complaint (pursuant to the pravisians of Rule VIII af the Cammissian s Rules af Practice), and having failed to. make appearance at the aforesaid hearing af August 1953 , or in anywise to. canvey notice af its desire or intentian to. calltest the allegations af the complaint, the provisions af Rule V (b) of the Commission s Rules prescribing procedure in event af default, became aperative.

Thereafter, the proceeding regularly came an far final cansideratian by the above-named hearing examiner, theretafore duly designated by the Commission, up an said complaint and default, and the said hearing examiner having duly considered the entire record herein, makes the fallawing findings as to. the facts, canclusian drawn therefrom, and order :

FINDINGS AS TO THE FACTS PARAGRAPH 1. Respondent S. S. Sawyer, Inc., hereafter sometimes referred to. as Sawyer, is a corparatian organized, existing, and doing business under and by virtue af the laws of the State af Florida with its principal offce and place af business located at Hastings, Florida. Par. 2. Sawyer is naw, and cantinuausly far the seven or eight years last past has been, engaged in the business af sellng patataes and other vegetables. With respect to potatoes, Sawyer sells to. three principal kinds af buyers.

Sawyer employs agents through whom it sells patataes to. same buyers. As compensatian far services rendered in effecting such sales to such buyers, Sawyer pays such agents a brokerage fee. Such brokerage fees vary, TInging fram about five cents to. about ten cents per hundredweight ar amounts equivalent thereto.. In ndditian to. selling patatoes to such buyers as agents of Sawyer same of such agents (hereinafter same times referred to. as "buying agents ) also purchase patataes fram Sawyer for their awn account fol' resale.

Sawyer also seDs potatoes directly to. other buyers, including same chain store arganizatians and food processors (hereinafter sometimes referred to as direct buyers).

Par. 3. In the course and conduct of such business, Sawyer causes such patataes, so sold to. be transported fram its place af business or s. S. SAWYER, INC. 335 333 I"indings elsewhere in Florida to. the places of business of such buyers, some af which Hre located in Florida and same af which are located elsesales af potatoes by Sawyer, here-where in the United States. All to. suchinafter referred to. invalved such tnmsportatian from Florida buyers with places af business located elsewhere and occurred during approximately the two 0.1' three years last past.

PAR. 4. (A) Sawyer pays a fee as brokerage to buying agents in connection with the sale of potatoes to them far their awn account in the same manner as it P'lYS a brokerage lee to them and other agents , and in the same ar sub-for sales to buyers effected through them stantially the same amounts.

Illustrative of such sales were some of the transactions which taak place during April and May af 1951 between Sawyer and one of its agents located in Baltimore, Maryland. In these transactions Sawyer invoiced such agent and such agent paid far potatoes at prices which were the same ar substantially the same as those charged other buyers purchasing at or about the same time; but in connection with such sales of potatoes to such agent for his awn account, Sawyer paid him brokerage in the same manner and in the same amounts as it paid hill brokerage in canneetian with sales of patataes to. buyers, effected through him as its agent.

to. direct buyers in same (B) In connection with sales of potatoes af fees as broker-instances, instead af Sawyer making the payments age ((alleged in subparagraph (A) above, it charges them prices which 0.1' about theare lower than t.hase charged other buyers purchasing at 0.1'same time. The prices ate lower by amount.s which are the same subshmtially the same as the brokerage fees that Sawyer pays to its agent.s far effect.ing sales to. buyers purchasing through them. Illustrative af such sales were transactions which taak place during April and May af 1951 between Sawyer and several direct buyers processars. In theseincluding chain store organizatians and faad transactions Sawyer invoiced such buyers at, and such buyers paid prices which varied fram time to time; but such prices were lower by amounts ranging fram about five to t.en cents per hundredweight than those at which other buyers purchasing at ar about the same times were invoiced and paid.

PAR. 5. In making payments of fees as brokerage, as alleged in Paraas alleged in Para-graph 4, (A), and in charging lower prices, af itsgraph 4 (B), Sawyer paid ar granted, in t.he course and conduct business in commerce, samething of value as a cammissian, brokerage ar other compensatian, and allowances and discounts in lieu thereof in cannectian with the sale af potatoes to. the other parties to such , representatives ar other intermediariestransaetians, or to. their agents Order 50 F. T. C.

therein who. were acting in fact far ar in behalf ar subject to the direct ar indirect cantrol af such other parties. conclusion The acts and practices af the respondent, as herein found, are in vialatian af subsection (c) af Section 2 af the Clayton Act, as amended by the Rabinson-Patman Act (D. S. C. , Title 15, Section 13). order It is ordered That the respondent, S. S. Sawyer, Inc., a carparatian and its affcers, directors, representatives, agents or employees, directly ar through any corporate ar other device, in cannectian with the sale af patataes or any other vegetable in commerce, as "commerce " is defined in the aforesaid Clayton Act, do. forthwith cease and desist fram:

1. Making payments to. agents an purchases far their awn accounts in amounts which are the same as the amounts af fees paid as brokerage to. agents eilecting sales to. other purchasers ar in any other amounts which are also paid as brokerage.

2. Granting a discount ar al1awance to. any purchaser which makes the price to. such purchaser lower than the prices at which sales are made to other purchasers, by any am aunt which is the same as the amount of brokerage fees paid to. agents effecting sales to. other purchasers ar in any other amounts which also are in lieu af brokerage. 3. Paying ar granting anything af value as a commission, brokerage ar other compensatian ar al1awance ar discount in lieu thereof to. the other parties to. such transactions ar to. their agents, representatives, or other intermediaries therein who. in fact act far or in behalf ar are subject to. the direct ar indirect cantral, of such other parties. ORDER TO. nle REPORT OF COMPLIANCE It is ordered That the respondent herein shall, within sixty (60) days after service up an it af this order, file with the Commission a report in writing setting forth in detail the manner and form in which it has complied with the arden' to cease and desist (as required by said declaratory decision and order of October 1, 1953 J. ANNSHIRE GARMENT CO. , INC., ET AL. 337 Consent Settlement IN THE MATTER OF ANNSHIRE GARMENT CO., INC., ET AL.

DECISION IN REGARD TO TH ALLEGED VIOLATION aF 'lhe FEDERAL TRDE COMMISSION ACT AND OF THE WOOL PRODUCTS LABELING ACT Oct. , 1953 Doclcet 6110. Complaint, July 1953-Decision, Where a corporation and its two offcers engaged in the manufacture and interstate sale and distribution of certain wool products as defined in the Wool Products Labeling Act- (a) Misbranded certain ladies' coats in that they were not stamped, tagged, or labeled as required by said Act and the Hules and Hegulations promulgated thereunder;

they con- (b) Misbranded said coats in that tagged or labeled "100% Wool," tained substantial quantities of fiber other than wool; and (c) Misbranded certain of said coats in that the fiber content of interlinings contained therein were not separately set forth on attached labels or tags as required:

Held 'l' hat such acts and practices were in violation of the \Vool Product" Labeling Act and the Hules and Hegulations promulgated thereunder and constituled unfair and deceptive acts and practices in commerce. Mr. George E. Steinmetz far the Cammissian. far respondents. Keller&! Wilbert of Pittsburgh, Pa. CONSENT SETTLEJliENT 1 Pursuant to. the pravisians of the Federal Trade Commission Act and the W 0.0.1 Products Labeling Act af 1939, the Federal Trade Commission, an July 21, 1953, issued and subsequently served its complaint an the respondents named in the caption hereof, charging them with the use af unfair and deceptive acts and practices in vialatian of the pravisians af said Acts. proceeding be disposed af The respondents, desiring that this , provided in Rule V af the Com- the consent settlement procedure , solely far the purposes af this proceeding, mission s Rules of Practice , and the cnfarcement af the order consented to. any review thereaf and canditianed upon the Cammissian s acceptance of the consent , and in lieu af answer to. said com- settlement hereinafter set forth plaint, hereby:

:l The Commission s "Notice" announcing and promulgating the consent settlement as published herewith, follows:

The consent settlement tcndered by the parties in this proceeding, a copy of which is served herewith, was accepted by the Commission on October 1, 1953, and ordered entered of record as the Commission s findings as to the facts, conclusion, and order in disposition of this proceeding.

The time for filing report of compliance pursuant to the aforesaid order runs from the date403443--57--of service hereof.

Findings 50 F. '1'. C.

1. Admits all the jurisdictional al1egatians set forth in the camplaint.

2. Cansents that the Cammissian may enter the matters hereinafter set forth as its findings as to. the facts, canclusian, and order to. cease and desist. It is understood that the respondents, in cansenting af said findings as to the facts, canclusian to. the Cammissian s entry specifically refrain fram admittingand order to. cease and desist, denying that they have engaged in any of the acts ar practices stated therein to. be in vialatian of law.

3. Agrees that this consent settlement may be set aside in whale or in part under the conditions and in the manner provided in Paragraph (f) af Rule V af the Commission s Rules of Practice. , the statement af the acts and The admitted jurisdictional facts practices which the Cammissian had reason to. believe were unlawful to. cease and desist, allthe cancJusian based therean, and the order which the respondents consent may be entered herein in final dispasition af this proceeding:

FINDINGS AS TO. THE FACTS PARAGRAPH 1. Respondent Annshire Garment Ca. Inc. , is a COl'paration organized and existing under and by virtue af the laws af the State af Kansas; and respondents Isidore Liebling and Jack LiebJing are the president- treasurer, and secretary, respedively, thereof. Said individuals formulate, direct and control the acts, policies and practices of said carparate respondent. The offces and principal place af business af all respondents are located at 101 East Kansas Avenue, Pittsburg, Kansas.

PAR. 2. Subsequent to. the eflective date af said W 0.0.1 Products Labeling Act af 1939, and mare especially since 1947, respondents have manufactured for introduction into commerce, introduced into. commerce, sajd, transported, distributed, delivered far shipment and offered far saJe in commerce, as "commerce" is defined in the VV 0.01 Products Labeling Act, wool products, as "waal products" are defined therein.

PAR. 3 Certain af said waal products described as ladies' Caltts were misbranded in that they were not stamped, tagged 0.1' labeled as required by the W 0.01 Products Labeling Act af 1939 , and in the manner and farm prescribed by the Rules and Regulations pramulgated thereunder.

PAR. 4. Certain af said waal products were misbranded within the meaning and intent af Section 4 (a) (1) af said Wool Products Labeling Act af 1939 and af the Hules lmd Regulations promulgated there- ANNSHIRE GARMENT CO, ) INC., ET AL. 339 337 Order ar tagged under in that they were falsely and deceptively labeled with respect to the character and amount of the canstituent fibers cantained therein. Among such misbranded wool products were ladies coats tagged ar labeled "100% Wool" ; whereas in truth and in fact said wool products were nat 100% waal, but contained substantial quantities af fibers other than wool. PAR. 5. Certain of said waal products described as ladies' caats were misbranded in that the fiber content of interlinings contained therein were not separately set forth on labels ar tags attached thereto as required under the provisions af Section 4 (a) (2) af the Waal Products Labeling Act af 1939 , and Rule 24 af the Rules and Regulations promulgated thereunder.

CONCLUSION The acts and practices af the respondents, as herein found, were and are in vialatian of the VV 00.1 Products Labeling Act af 1939, and af the Rules and Regulations promulgated thereunder; and as such constitute unfair and deceptive acts and practices in commerce within the intent and meaning af the Federal Trade Cammissian Act. ORDER TO CEASE AND DESIST It is ordered That respondent Annshire Garment Ca. Inc. , a carparatian, and its alIcers, and respondents Isidare Liebling and Jack Liebling, individually, and respondents' representatives, agents, and employees, directly ar through any corporate or other device, in cannectian with the introduction ar manufacture for intraductian into. commerce ar the offering far sale, sale, transpartation ar distribution in commerce, as "commerce " is defined in the Federal Trade Cammission Act and the VV 0.0.1 Products Labeling Act of 1939 af ladies coats ar other "wool products" as such products are defined in and sub- Products Labeling Act af 1939, which productsject to the Wool contain, purpart to contain ar in any way are represented as containing "wool reprocessed wool" ar reused waal " as those terms are defined in said Act, do. forthwith cease and desist fram misbranding such products by :

1. Falsely ar deceptively stamping, tagging, labeling ar otherwise falsely identifying such products as to. the character ar amount af the canstituent fibers contained therein;

2. Failing to securely affx to. or place on each such product a stamp, tag, label or other means of identification showing in a clear and conspicuous manner:

(a) The percentage af the total fiber weight af such waal prod uct exch'sive of arnamentation nat exceeding five percentum af said total Order 50 F.

fiber weight of (1) wool, (2) reprocessed wool, (3) reused wool, (4) each fiber other than wool where said percentage by weight af such aggregate af five percentum ar all other mare, and (5) thefier is fibers;

(b) The maximum percentages af the total weight of such waal product af any nan- fibraus laading, filling, ar adulterating matter; (c) The name ar the registered identification number af the manufacturer af such wool product ar of one or more persons engaged in intraducing such waal product into. commerce, or in the offering far sale, sale, transpartatian, distribution ar delivering far shipment thereaf in commerce, as "commerce " is defined in the W 0.0.1 Products Labeling Act af 1939.

3. Failing to separately set forth an the required stamp, tag, label other means af identification the character and amount of the canstituent fibers appearing in the interlinings af such waal products as provided by Rule 24 af the Rules and Regulations promulgated under said Act.

Provided That the foregaing provisions concerning misbranding shall nat be construed to. prahibit acts permitted by paragraphs (a) and (b) af Section 3 af the W 0.0.1 Products Labeling Act af 1939;andProvided further That nothing contained in this order shall be canstrued as limiting any applicable provisions af said Act ar the Rules and Regulatiaps promulgated thereunder.

It is further' ordered That the respondents herein shall, within sixty (60) days after service upon them af this order, file with the Commission a report in writing setting forth in detail the manner and farm in which they have complied with the order to cease and desist. Annshire Garment Ca. Inc. a carparation.

By 'Is/ Isidore Liebling (Name) President (Tite) (Corporate Seal) /s/ Isidore Liebling Isidare Liebling, individually and as an offcer af Annshire Gar men t Ca. Inc., a carporation.

ANNSHIRE GARMENT CO. , INC., ET AL. 341 337 Order /s/ Jack Liebling Jack Liebling, individually and as an affcer af Annshire Garment Ca. Inc., a carparatian.

Date: September 18, 1953.

The foregoing consent settlement is hereby accepted by the Federal Trade Cammissian and ardered entered of record an this 1st day October, 1953.

342 FEDERAL TRADE Come\1ISSlON DECISIONS Consent Settlement 50 F. T. C.