Hudson Garment Co., Inc., et al.

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Ix THE l\:1Able.R OF HUDSOK GAR mnt CO., IXC., ET AL.

CONSENT ORDER, ETC., IN REGARD TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE CO:Hl\fISSION ACT DOcket 621.9. Gomplafnt, J1/W , 1954-Deci8iull Oct, , 1954 Consent order requiring a ew York manufacturer to eeaie representing falsely, by affxing markings, insignia, etc. , resembling tbose used by the U, S, Armed Forces, that their Armed Services type jackets and outer garments were manufactured for the L. S, Armed Forces and in accordance with their specifications.

Before lift. ,lam,es A. Pur-cell hearing examiner. 111'. l'eTTal A. , lm'dan for the Commission. I'. I. A,thm R08enbel'q, of New York City, for respondents. COl\IPLAINT Pursuant to the provisions of the Federal Trade Commission Act and by virtue of tbe authority.y vest.ed in it by said Act, the Federal Trade Commission, having reason to believe that Hudson Garment Co., Inc., a corporation, and Samuel Zigman, Simon Ginsberg, and Pearl Zigman, individually and as offcers of said corporation, hereafter referred to as respondents, have violated the provisions of said Act, and it appearing to the Commission that H proceeding by it in respect thereof ,vould be in the public interest, hereby issues its complaint, stating its charges in that respect as follows: PARAGRAPH 1. Respondent Hudson Garment Co. Inc" is a corporation organized, existing and doing business under and by virtue of t.he laws of the State of New York with its offce and principal place of busim'ss located at eoo Broadway, j\ew York, New York. H.espolldents Samuel Ziglnan, Simon Ginsberg and Pearl Zigman are respectively president, treasurer and secretary of said corporate respondent. These individuals acting in cooperation with each other forrnulate, direct and control all of the policies, acts and practices of said corporation, The address of said individual,l respondents is the same as that of said corporate respondent. R. 2. H.espondellts are now, and have been for more than one year Jast past, engaged in the manufa('tllrer sale and distribution of heavy outerwear, including Armed Services type garments, in commerce, allong and between the yarious States of the rnite-d States and in the District of Columbia. Respondents maintain, and at all HUDSON GARMEXT CO. , INC. , ET AL. 383 382 Complaint times mentioned herein have maintained a substantial course of trade in said garments, in commerce among and between the various States of the United States.

PAR. 3. The garments manufactured, sold and distributed by respondents in the course and conduct of their business as aforesaid closely resemble the jackets and outer garments issued and furnished to members of the United States Armed Forces in color, pattern and style. Hcspondents also cause to be affxed to said garments certain markings, insignia, labels and tags ,,,hi('h purport to designate the branch of service, model, contract number, speeification number, stock number and directions as to the manner of llse in substantially the same form, kind and manner as the lnarkings, insignia, labels and tags prescribed and used by the L:united States Armed Forces on similar and like garments. Typical of the "ords and terms appearing on the markings, labels and tags, are as follows: JACKET, INTER:\IEDIATE, FLYIlSG TYPE B SPECIFICATION KO. 1ST2FS STOCK O, T54-289 ORDER :\0. 55-7283 lY AIR FORCES TYPE.

PAHKA l'ANKEll J ACKE'l U, S, _A lL\IY TYPE.

Typjcal of insignia used on certain of said ga.rments is that of the Army Air Forces, consisting of a five point star with two wings enclosed in a- circle, with the words "Army Air Forces" appea.ring immec1iate1y below.

PAR. 4, Through the use of said colors, patterns and styles and the markings, insignia, labels and tags, as described in Paragraph Three hereof, respondents have represented and implied and do represent a-nd imply that said jackets and outer garments, manufactured, sold and distributed by them in commerce \Were manufactured for the United States Armed Forces and in accordance with specifications of said Armed Forces.

PAIL 5. Said representations and implications are ialse, misleading and deceptive, In truth and in fact, respondents: said garment 21-j 423783- 5H- Decision 51 F. T, C.

were neither manufactured for the United States Armed Forces nor in accordance with specifications of said Armed Forces. PAR. 6. By selling and distributing to wholesalers and dealers said products manufactured as aforesaid and having affxed to them the markings, insignia, tags and labels hereinabove described, respondents furnish to such wholesalers and dealers the means and instrumentalities through and by which they may mislead and deceive the purchasing public as to the origin, kind, type, and style of their said jackets and outer garments.

PAR. 7. In the course and conduct of their business respondents are in direct and substantial competition with other corporate.ions and firms and individuals engaged in the sale in commerce of jackets and outer ganm nts.

PAR. 8. The sale and distribution in commerce of said garments in the color, style, design and with markings, as hereinabove alleged has had and now has the tendency and capacity to a,nd does mislead a substa.ntial portion of the purchasing public into the belief that said garments were manufactured for the l:7nitecl States Armed Forces and in accordance with specifications of said Armed Forces. As a result thereof, substantial trade in commerce has been unfairly diverted to respondents from their competitors and substantial injury has been done to competition in commerce.

PAl, 9. The aforesaid acts and practices of the respondents, as herein alleged, are all to the prejudice and injury of the public and of respondents' competitors and constitute unfair and deceptive acts and practices and unfair methods of competition, in commerce, ,within the intent and meaning of the Federal Trade Commission Act. DECISION OF THE CO (l\IISSION 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 October 1 , 19;'54, the initial decision in the instant matter of hearing examiner James A. PurceJ1 as set out as follows, became on that date, the dcc.ision of the Commission.

I!'Tl'AL DECISIQX BY , LUIES A. prRCELL lie,\RIXG Exx"nNEH Pursuant to the provisions of the Federal Trade Commission Act the Federal Trade Commission on .J une 23 , 1954, issued and subsequently served its complaint up;:m the respondents, Hudson Garment Co. Inc., a corporation, Samuel Zigman, SiUlOl1 Ginsberg, and Pearl Zigman, the thrp,e last named respondents being charged n:s individuals HUDSO GARMENT CO" l1C. , ET AL. 385 382 Order and as offcers of the corporate respondent, whose principal offce and phlce of business is located at No. 600 Broadway, Kew York, Kew York. Respondents are engaged in the manufacture, sale and distribution of heavy outerwear, including garments or the type used in the Armed Services of the 17united States.

Thereafter there was filed with the Federal Trade Commission a stipulation between the parties, dated August 16, 1054, providing for entry against respondents of a consent order, which said stipulation appears of record in this formal proceeding. By the terms thereof the parties agree that the complaint and said stipulation shall constitute the entire record herein withdraw\val of the ans"\ver heretofore filed by respondents on .J uly 12, 1054, being moved and hereby granted; that respondents admit al1 of the jurisdictional allegations set forth in the complaint; that the parties waive hearing berore a hearing examiner or the Commission, and also the making or findings of facts and conclusions or la\v by the Hearing Examiner or the Commission; that respondents waive the dght to file exceptions or to demand oral argument before the Commission and all further and other procedure before the Hearing Examiner or the Commission to which, but for the execution and filing- of the aforesaid stipulation, t.he respondents might be entitled under the Federal Trade Commission Act or the rules of practice of the Commissioi1. Said stipulation specifically waives any and an right, power or privjJege to challenge or contest the validity of the order hereinafter made and further provides that the complaint forming the basis of this proceeding may be used in construing the terms of the said order, which order may be altered, modifie,d or set aside in the manner provided by law for other orders of the Commission "\v here such action is sought. SA.id stipulat.ion was execl1te(l for settlement purposes only and does not constitute an admission by respondents that they have violated the Jaw as alleged in the complaint. On the basis of the foreg-doing, the undersigned Hearing- Examiner concludes that this procreding is in the public interest and, in conformity "\vjth the action in said st.ipulation conte,mplatec1 nncl agreed upon, makes the following order:

ORDER It ordered that respondents lIuc1son Gnrmcnt Co" Inc" a corporation, nnd Samuel Zigman, Simon Ginsberg and Pearl Zig-man inclividmdly and as offcers of said corporate.ion, and respondents agents, representatives and employes, directly\ or through any corporate or other device, in the offering- for snIe" sale or distribution of "\yenring apparel iu commerce, as ;'COlllnerCe " is defined in the Fed- Order 51 F, T. C, era 1 Trade Commission Act., or of any other garments, do forthwith c.ease and desist from represen6ng, directly or by implication, by marking, branding, labeling, tagging, or in any other manner: contrary to fact; that such merchn.udise was manufactured for the Armed Forces of the Vniteel State,s or in aeeord lncc with specifications of said Armed Forces.

ORDER TO File HEPOHT OF CD2\IPLIANCE 1 t is ordered that the respondents herein shall within sixty (60) clays after service upon them of this order, file with the Commission a report in writing set6ng forth in detail the manne,I' and form in which they have eornplied with the order to cease and desist (as required by said declaratory decision and order of October 1 , 1954:1 BONDED THHIFT STA IP CO. , ETC. 387 Complaint