Woody Fashions Inc

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IN THE l\IA TTER OF WOODY FASHIONS INC. ET AL.

OlilER, OPINION, ETC., IN REGARD TO THE ALLEGED VlOLATIOX OF THE FED- ERAL TRADE CO:.BIISSIOK ACT AND OF THE WOOL PRODUCTS LABELING ACT Docket 6128. Com.pra-int, Sept. 1953 Deci-sion, Aug. , 1954 Where a manufacturer of wool products- (a) nsbranded certain ladies' coats which contained none of the hair of the Cashmere goat as "Imported Cashmere ane! All Wool, Exclusively Blended" Exclusively Blended, \Vool ami Cashmere 800/ \Voal, 20% Cashmere etc. ; and (b) l\:Tsbranded certain of said coats labeled as "Imported Cashmere and All \Vool, J1J:sclusively Blended" , in that it failed to set out the percentage, by weight, of cashmere contained therein:

Held That such misbranding of wool products was in violation of the Wool Products Labeling Act of 1939 and constituted unfair and deceptive acts and practices in commerce.

Before 1.1lr. Abner E. Lipscmnb hearing examiner. 3fr. Henry D. 8t?'in qer for the Commission. ucker Felcl1nan and illi'. Sai17' uel R. F1 iedman of New York City, for respondents.

DECISION AXD OPINION OF THE COloDUSSION This matter has come before the Commission upon respondents appeal from the initial decision of the hearing examiner which concludes that they have violated the IV 001 Products Labeling Act of 1939 by falsely labeling ladies' \\001 coats as containing cashmere. Briefs in support of and in opposition to the initial decision have been filed. Oral argument has not been requested. In support of their appeal respondents take exception to rulings of the hearing examiner excluding reports of tests by Adolph :M:arklin and by Josephine V. Lawida of the content of certain of the lTmterial in question. They were rej ected by the hea.ring examiner beca.use the person making the tests were not present as witnesses a,nel available for cross-examination as to the contents of t.he reports. The report of the tests by Josephine V. Lawida was identified by Arthur B. Coe Chief Microscopist for the L'uited States Testing Company, Inc. , who was her superior. He testified that he did not participate in the actual1 testing and could not recall whether or not he 1Hld examined respondents' fabric at a.ll. Similar1:y, as set out in detail in the initial deci. WOODY FASHIONS , I::C. , ET AL.

Decision sian, the President of Hatch Textile Hesearch, Inc., who identified the report of the tests by Adolph Marklin, had no knowledge of the actual tests covered by the report.

Respondents contend t.hat under a recognized exception to the hear- Eay rule a. report of a test made in the regular course of business can be placed in evidence without making the person conducting the test available for cross-examination. However, this record shows that jt is extremely diffcult to jdentify cashmere fiber in a fabrjc. This is not a rontine busines operation with which a supervisor would be thoroughly familiar. The testing procedure and the personal qualifications of the persons conducting the test.s are extremely important in this case as the different persons testing the same fabrics have ob tained such opposite results. Under these circumstances, the Commission is of the opinion that the hearing examiner correctly barred from evidence reports of t.ests where the person conducting the test was not made available for cross-examination. csponrlents furthe.r take exception to the findings in the initial decision that respondents' products containsc1no hair of the cashmere goat and that they rnisbrandecl them by labeling them as containing 20% and 300/ cashmere in vjolatjon of the ' Wool Products Labeling Act. The Commission has fully considered the record and is of the opinion that the initial decision correctly so held and that the initial deeision is correct and proper in all respects. It is ordel'ed therefore, that respondents' appeal is hereby denied and that the initial decision is hereby adopted as the decision and opinion of the Commission.

It is further ordered that respondents ",Vooely Fashions, Inc., a corporation, and Harry D. Graff and I-Iarry Zucker shall, within sixty (60) days after servjce upon them of thjs 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 contained in the initial decision, a copy of ,which is attached hereto. Said initial decision, thus adopted by the Commjssjon as jts decision follows:

INITIAL DEClSIOX BY ABXER E. LIPSCO)!B, HL\RIXG EXAl\IIKER 1. The complaint in this proceeding ,yas issued on September 21 1953, charging J\Ioody Fashions, Inc., and IIarry D. Graff and Harry Zucker, individually, with misbranding ladies' wool coats by affxing thereto tags or labels falsely representing that such coats were a blend of cashmere and \'1001, and by failing to revertl on one of such labels the percentage by ,,'eight, if any, of the, cashmere fiber contained in 42.'J7S:'J- i"S- Decision 51 F. T. C. uch coat. These labels are alleged to have been used in violation of Sections 4 (a) (1) and (2), respectively, of the Wool Products Laheling Act of 1939 and the Rules and Hegulations promulgated thereunder, and to constitute unfair and deceptive acts and practices within the intent and meaning of the Federal Trade Commission Act. 2. Respondents, in their o.n8,ve1', admit that \Voody Fashions, Inc. is a corporation located at 237 1Vest 37th Street, New York 18, New Yark, and is organized and existing under and by virtue or the laws of the State of New York; that individual respondents Harry D. re-Graff and Harry Zucker are the President and Sales Manager, spectively, of the corporate respondent, and that they direct and control the acts, policy and practices thereof. Respondents further admit manufacturing wool products; offering them for sale, and introducing, selling, transporting and distributing such wool products in commerce, subsequent to lU51, within the intent and meaning or the Wool Products Labeling Act of 1939. They deny, however, that they have misbranded their wool products in any way, or that they have committed any acts or engaged in any practice in violation of the .W 001 Products Labeling Act of 1939 or the Federal Trade Commission Act.

3. The denial.ls in respondents' answer were modified during the course of the hearing by an admission, which is herein accepted as true, that one label, used on these products, which bore the legend "Imported Cashmere and All .Wool, Exclusively Blended " and the use of which had been discontinued early in 1953, had failed to show the percentage by weight of cashmere present in the product, and was therefore in violation of the .W 001 Products Labeling Act of 1939 and the Hules and Hegulations promulgated thereunder. 4. In the light of the above facts, the issues remaining in controversy are whether respondents' products contained cashmere, and if so, whether they contained the respective percentage of cashmere , namely, 209'0represented, respectively, on two of respondents' labels 709' wool.cashmere 809' wool, and 309' cashmere 13 In order to understand these issues clcarJy, it must be remembered that the term "wool" is defined as "* * * the fiber from the fleece of the sheep or lamb or hair of the Angora or Cashmere goat * * *" and other specialty fibers not here involved (Sec. 2 (b), Woo! Products Labeling Act of 1939). Accordingly, any fabric composed of a combination of the fleece of the sheep or lamb with hair of the Cashmere or Angora goat may hwfully be labeled "All .Wool" or "100% Wool." On the other hand, although "mohair" and "cashmere" ate included within the general statutory definition of wool WOODY FASI-IIO INC. ET AL.

Decision these words may not, under the provisions of Hule 19 of the l ules and Regulations promulgated under the Act, lawfully be used on a label together with the word "wool" or other fiber designations, unless the respective percentage of each such fiber is shown thereon. 5. In the latter part of 1951 the respondents were buying bbrics from a source other than "Wyandotte IVorsted Company, with a fiber content of 20% cashmere and 80% wool, for a price of $4. 00 to $5. per yard, which they had labeled accordingly. Thereafter, in thc early part of 1952, respondents began buying fabrics from the vVyandotte IVorsted Company at a price of approximC1tely $3.30 per yard. These fabrics were delivered to the respondent with the representation that they were 100% wool. Such a representation might lawfully have been made to describe a fabric composed wholly of the ileece of the shee.p or lam b, or of mohair or the hair of the Angora or Cashmere goat, or of any blending thereof. In 1952, shortly after the respondents began their purchases of the fabrics in question, the president of the respondent corporation caused samples of such fabrics to be sent to two separate testing laborutories, requesting reports on the amount of cashmere and wool fiber eOlltainecl in the submitted samples. After the United States Testing Company, Inc, Hoboken Kew Jersey, rendered a report to respondents, to the eifect that on8 of the samples contained a blend of 30% cashmere, 35% wool and 35% mohair, whereas the other sample contained a blend of 80% Iranian and similar cashmeres, 20% mohair, and negligible traces of wool, the respondents began placing on their ladies' coats made from the fabrics purchased from the vVyandotte "Worsted Company, labels showing, in one instance, a content of 20% cashmere 80% wool, and, in another instance, 30% cashmere and 70% wool. 6. A. The evidence presented in support of the complaint is in sharp contradiction to that presented by the respondents, and it is necessary, therefore, to evaluate the credibility of the witnesses, and to determine the relative probative strength of all the evidence. B. The president of the IVyandotte vVorsted Company, and the manager of that company s mill which manufactured the particular fabrics in question, both testified that the fabries were made of a blend of sheep s-wool and mohair, and contained no cashmere. either of these executives represented themselves as experts in the ana.lysis of ,vool and kindred fibers, and neither executive personal11y observed the actual blending of the fibers Ivhich comprised the finished product, intel' sold to respondents. The manager of the mill however, exercised general supervision oyer the blending of fibers ill the fabrics in question; and the reports I\which these executives 1'8- , , . FEDERAL TRADE COM:\IISSION DECISIOKS Decision 51 F. T. C.

eeived, in the ordinary and usual course of business, from their subordinates in the textile mill, to the effect that the fabrics in question were made of sheep s- wool and mohair ficeC3 and contained no cashmere, and upon which, in part, they based their testimony, appear to be reliable find trustworthy. In fact, there appears to be no motive why they should represent their product as less desirable on the market than they stated it would have been, if represented as part cashmere.

C. Two samples of fabrics cut from two of respondents ' coats labeled, respectively, 2070 Cashmere, 80% 'Wool" and "30% Cashmere, 70% 'Wool " were submitted to Dr. John It Hardy, of the Nittany Laboratory, State College, Pennsylvania, for a determination of the fiber content thereof. Dr. Hardy reported in his testimony that, according to his analysis, neither coat contained cashmere. but that they eonsisted rather of lamb wool and mohair. It was uncontradicted that Dr. lIarc1y was a scicntist of specialized education and experience. lie had recei veel the degrees of Bachelor of Science, :l\aster of Science, and Doctor of Philosophy; had been employed for many ye Lrs, until his recent retirement, by the Gnited States Depaliment of Agriculture, ,yhere he was placed in charge of animal fiber research work. In 1948 he had received a distinguished a,yarcl from the Deprntrnent of Agricult.ure for the invention of a device for making cross-sections of all kinds of fibers. His testimony as to exact procedure followed by him in the analysis of the samples of ;fabric submitterl to him, ,which had been removed from two of respondents ' coat.s, ,yas deal', objective, impartial and convineing, creating t.he strong impression that. he was an authority on the subject. of animal fibers, and had performed a earefnl and minntely detailed analysis of the fabrics in question. Iris testimony , ill every respect, 'YOlihy of belief.

D. Respondents sought, by means of the testimony of the president of Hatch Textile He,search, Inc.., to place in evidence a report of a fiber analysis made by a technician of that laboratory. The president's testimony reveal1ed, however, t.hat he was not himself a tec.hnician, and that he had not personally supervised the analysis in question. In fact, the analysis was shmnl to have been performed by the technician in his own home, and such technician did not appear as a witness herein. In view of this evidence, and since the record shmys that the analysis in question required the exercise of special technique and judgment., the rpport, which was clearly hel'eSi1Y in character not admissible, as contended by respondeTlts under the theory of an , ,, WOODY FASHIOKS , INC. , ET AL.

Decision act performed in the ordinary and usmt1 course of business. Aec.ordingly, it WfLS excluded from the record.

E. R,respondents, in their letter transmitting samples of the fabrics in question to the United States Testing Company, Inc., asked for a report on the anwunt of cashmere and '\vool fiber contained therein. The two reports of these requesteel fiber analyses were received in evidence after the two technicians who had performed the tests reported therein had testified. The first of these tec111icians, 1\1i8s l\1uriel Albanesius, testified that she was a high-school graduate, with no college training and no experience in the analysis of fibers previous to that gained during the past six years, when she had been working for the United States Testing Company, Inc. Her knowledge of wool was very scanty; for example, she did not know the native habitat of the cashmere goat, nor did she know the characteristics of the growth of the hair or fur fiber on a cashmere goat. She had done no systematic reading on the subject of fiber in geneml. The second technician, Mr. Felix S. EicheJbaum, had received a Bachelor of Science degree in textile manufacturing, and had been employed for a year and a half by the United States Testing Company, Inc., as a technician. Although he recognized the report of the fabric analysis in question, showing that such sample contained 80% cashmere and 20% mohair, he stated that he had pedormed so many similar tests that he could not remember the details of this particular one. He testified, in effect, that he knew the report to be correct at the time it was made. Although his testimony was legally suffcient to warrant the reception into evidence of the report itself, his failure to remember the details of his analysis detracted from the probative strength of such report.

F. The president of the respondent corporation testified that it was at his direction that samples of the fabric purchased !rom thc Wyandotte \Vorsted Company were sent to the United States Testing Company, Inc., for determination of the content of cashmere fiber therein. He gave no satisfactory answer to the question of why he had expected cashmere to be present in a fabric which he had purchased as 100% wool hen in fact cashmere, in most instances, sold for considerably more than ordinary wool. 'Vhen asked why he sent samples of the fabrics purchased !rom the 'Wyandotte 'Worsted Company to a laboratory with request that the content of cashmere therein be determined, thereby implying that the fabric did in fact contain cashmere, he was evasive, asserting that he did not write the letter and that the letter did not imply a content of cashmere in the sampl submitteel for testing. lie admitted that he had, prior to , . , . . , FEDERAL TRADE CO),)(lISSIOX DECISIONS Order 51 F. T. C.

the hearing, described cashmere as fI, selling "gimmick " but when asked to define the word "gimmick " he was again evasive, and it was only after repeated questions that he could be induced to testify respecting the word "gilml1ick. lie finally stated that "gimmick " in relationship to the word "cashmere/' signifies, to the purchasing public, an "extra feature When asked why he did not mark the coats made .from the fabric purchased from 1Vyandotte .W orsted Company as 100% wool "if they would sell just as well" as if marked part wool and part cashmere, he ansi\crecl we were using, we were selling at the time 20% cashmere from other sources. Obviously his reply was not a satisfactory answer to the question. In view of such evasions, the probative value of his testimony was materially lessened.

7. On the basis of the entire record, and after a cOlnparative evaluation of all the testimony and other evidence, it is concluded that the evidence adduced in support of the complaint is reliable, probative and substantial, and establishes tlmt respondents' wool products, namely, ladies' coats, in truth and in fact, contained none of the hair of the caslm1ere goat, and that, consequently, respondents have misbranded such coats by tagging or labeling them "Imported CaSllll1ere and All 1V 001, Exe1usively Blended Exe1usively Blcnded W 001 and Cashmere, 80% 1Vool, 20% Cashmere " and "Exclusively mended Wool and Cashmere, 70% .Wool, 30% Cashmere " in violation of the 1Vool Products Labeling Act of 1939.

8. It is further concluded that the misbranding of wool products herein found constitutes unfair and deceptive acts and practi es in commerce, within the intent and rnmtning of the Federal Trade Commission Act; and, consequently, that this proceeding is in the public interest. Accordingly, It is ordered that respondent "Toody Fashions, Inc., a corporation and its offcers, and respondents Harry D. Graff and Harry Zucker individually, and respondents' representatives, agents and employees directly or through any corporate or other devie-e, in connection with the introduction or manufacture for introduction into commerce, or the oflering for sale, aaIe, transportation or distribution in commerce as "commerce" is defined in the J, cc1eral Trade Commission Act and the 1V 001 Products Labeling Act of J 939, of ladies' coats or other "wool products" as such products are defined in and subject to the ,Vool Products Labeling Act of 193D, which products contain, purport to contain, or in any way are represented as containing "wool reprocessed wool" or "reused wool " as those terms are defined in said Ac. do forthwith cease and desjst from misbranding such products by: WOODY FASHIONS, INC. , ET AL.

Order 1. Falsely or deceptively stamping, tagging, labeling or otherwise falsely identifying such products as to the clmmcter or amount of the constituent 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 of thc total fiber weight of such wool product exclusive of ornamentation not exceeding five percentum of said total fiber weight, of (1) wool, (2) reprocessed wool, (3) reused wool, (4) each fiber other than wool where said percentage by weight of such fiber is five percentum or more, and (5) the aggregate of all other fibers;

(b) The maximum percentage of the total weight of such ",mol product, of any non-fibrous loading, fining, or adulterating matter; (c) The name or the registered identification number of the manufacturer of such \Voal product or of one or 110rc persons engaged in introducing such \Vool product into commerce, or in the offering for sale, sale, transportation, distribution or delivering for shipment thereof in commerce, as "commerce" is defined in the 001 Products Labeling Act of 1939.

3. Falsely or deceptively stamping, tagging, la.beling or other\Vise identifying such products as containing the hair or fleece of the Cashmere goat -when such is not the fact.

4. Stamping, tagging, labeling or otherwise identifying such products as containing the hair or fleece of the Cashmere goat without setting out in a clear and conspicuous manner on each such stamp, tag, label or other identifica.tion the percentage of such Cashmere therein; Provided that the foregoing provi ions concerning misbranding shall not be construed to prohibit acts permitted by paragraphs (a) and (b) of Section 3 of the 'Wool Products Labeling Act of 1939; and Provideclfurther that nothjng conta.ined in this order shall be construed as limiting any applic.able provisions of said Act or the Rules and Regulations promulgated thereunder.

FEDERAL TRADE COMMISSION DECISIOKS Decision 51 F. T. C.