Reddi-Spred Corporation

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IN THE NUTT REDDI-SPRED CORPORATION ORDER, OPINION , ETC. IN REGARD TO THE ALL) GED VIOLATION OF THE FEDER...\L TRADE COl\MISSION ACT AS AMENDED Docket 6228. Compla-int, June 30, 1954-Decision, May, 1955 Order requiring a seller in Philadelphia, PIi. , to cease using in advertising representations and suggestions that it "Reddi-spred" oleomargarine was a dairy product.

Before 11r. Abner E. Lipscomb hearing examiner. 11r. William L. Pencke for the Commission. Duane, 11 oms II eckBcher of Philadelphia, Pa., for respondent. Mr. 11. R. Garstang, of -Washington, D. for ~ational Milk ducers Federation amicu curiae.

DECISION OF THE COMMISSION STATE IENT OF TH CASE The Federal Trade Commission on June 30, 1954, issued a complaint alleging that respondent, Reddi-Spred Corporation, has violated the Federal Trade Commission Act by the use of unfair and deceptive acts and practices in commerce in the sale of oleomargarine. Respondent filed an answer denying that its advertisements were in violation of law.

Pursuant to notice, hearings were held in Philadelphia, Pennsylvania, on September 3 and 22, 1954, before Abner E. Lipscomb, a hearing examiner designated by the Commission to hep.r this proceeding. Full opportunity to be heard, to examine and cross-examine witnesses and to introduce evidence bearing on the issues was afforded respondent and counsel supporting the complaint. All testimony and other evidence was recorded and filed in the offce of the Commission. After receiving proposed fmdings of fact, the hearing examiner fied his initial decision dismissing the case for failure of proof on October , 1954. Thereafter, counsel supporting the complaint appealed to the Commission from this initial decision. Briefs were filed in support of and in opposition to the appeal, including a brief of the N ational iilk Producers Federation as amicus curiae, and respondent' brief in reply thereto.

Upon consideration of the entire record herein, the Commission havino- determined thflt the hearing' examiner erroneously dismissed REDDI-SPRED CORP. 1075 1074 Findings this complaint, reversed and set aside his initial decision and in lieu thereof makes the following:

FINDINGS OF FACT Respondent, Reddi-Spred Corporation, is an illinois corporation having its principal place of business at 311 Walnnt Street, Philadelphia, Pennsylvania.

Respondent sells oleomargarine under the trade or brand name Reddi-Spred to purchasers located .in various States of the United States other than Pennsylvania, and during the last two years has reg nlarly caused its prod net, when sold, to be transported from its place of business in Pennsylvania to its said purchasers in interstate commerce. Respondent's sales of Reddi-Spred, during the year from Angnst, 1953, to September, 1954, totaled approximately $70 000, of which approximately 40 percent was outside of the State of Pennsylvania.

In the course of its said business, respondent has disseminated and caused the dissemination of advertisements of Reddi-Spred by various means in commerce, as "commerce" is defined in the Federal Trade Commission Act, including advertisements inserted in newspapers and television programs, for t.he purpose of inducing and which are likely to induce, directly or indirectly, the purchase of Reddi-Spred; and respondent has also disseminated and caused the dissemination of advertisements concerning Reddi-Spred by the same means for the purpose of inducing and which are likely to induce, directly or indirectly, the purchase of Reddi Spred in com:meree, as "commerce" is defined in the Federal Trade Commission Act. Respondent' s advertisements, above referred to, all feature tile name "Recldi-Spred" :in large dark letters. All contain a large picture of a package of Reddi-Spred with that name showing on it in large dark letters and with either Oleomargarine or :Margarine also on itin large, but less distinct, letters. All of the advertisements also feature the word "BUTTER" in large dark letters. Since September, 1953 all of the advertisements show that "VEGETABLE FATS" are ingredients in Rec1di-Spred in letters of equal size and prominence aE, the word "B"GTTER."

An example of one advertisement which respondent has dissemmated, and intends to disseminate.in the future, reads as follows: Sorry * fI We mu€t r:llil it ":\lnrgarine " (that's the la\y) But this product is so wonderfully different (Picture of a girl's face) that it rea)Jy should have a name all its own. Order 51 F.

That' s why 'Ie named it REDDI-SPRED (in very large black type) Brand Premi.utn OLEO iARGAHINE containing not only (l'icture of a tub and a em'ton YEGETABLE FATS of Rcndi-Spred dearly labut also beled Oleomargarine) REAL FRESH BL:TTER (List of all ingredients in small letters) l\Iakes BV'l"ler BETTER It Taste Yes, it's the BCTTEH that makes it taste BETTEH '" * " that' s why we sa Don t Confuse "Ordinary ::lal'garine" whh REDDI-SPRED. Compare it ,,,lth ;Ul T spt"ead at any price "' " " you ll agree that for taste and economy, REDDJ-SPRED is perfect for every sening and cooking need. Compare, but don t confuse REDDI-SPRED with "ordinary marg;arille Hu:v R d(1i- Spred todilY from your super market or neighborhood grocer! The prominent use of the word butter in respondent' s advertising, together ",ith the representation that Reddi-Spred is some kind of a product other than margarine because of its butter content, clearly suggests that it is a dairy product.

CONCLI:SION The fact that respondent's advertisement.s label Reddi- Spred as oleomargarine and clearly state that it contains vegetable fats as well as butter does not remove the suggestion that it is a dairy product. The emphasis on the unknown percentage of butter content in Reddi-Spred and the statement that it should have a name other than margarine and shouldn t be confused with ordinary margarine because of its butter content, represents and suggests that while it is technically oleomargarine it. is actually a dairy product.

The Commission, therefore, concludes that respondent's acts and practices, as hereinabove found, are all to the prejudice and injury of the public and constitute unfair and deceptive acts and practices in commerce within the intent and meaning of the Federal Trade Commission Act.

OHD:

It is ordered That the respondent Reddi-Spred Corporahon, a corporation, and its offcers, agents, representatives and employees, directly or through any corporate or other device, in connection w ith the offering for sale, sale or distribution of oleomargarine Or margarine, do fort.hwit.h cease and desist from, directly or indirectly, REDDI-SPRED CORP. 1077 1074 Opinion 1. Disseminat.ing or causing to be disseminated by means of the 1Jnited States mails or by any means in commerce, as "commerce" is defined in the Federal Trade Commission Act, any advertisement which contains any statement, word, grade designation, design, device, symbol, sound or any combination thereof which represents or suggests that said product is a dairy product; Provided, however That nothing contained in this order shall prevent the use in advertisements of a truthful, accurate and full statement of a1l of the ingredients contained in said product, or of a truthful statement that said product contains butter or any other dairy product provided the percentage thereof contained is clearly and conspicuously set forth.

2. Disseminating or causing to be disseminated by any means for the purpose of inducing or \which is likely to induce, directly or indirectly, the purchase in commerce, as "commerce" is defined in the Federal Trade Commission Act of said product any advertisement which contains any of the representations prohibited in paragraph Olle of this order.

It is furthe?' ordered That respondent shall, within sixty (60) days after service upon it of this order, file with the Commission a report jn writing setting forth in detail the manner and form in which it has complied with the order to cease and desist. OPINIOK OF THE COM :1SSIOK Per CUIUAM: :

An examination of resp(\ldent.s Reddi-spl'ecl oleomargarine advertisements reveal.ls that the word "butter" was prominently displayed throughout and in fact emphasized as the most choice and flavorful ingricdient of the product.

Based On the Commission s opinions in the matters of E. F. Dl' d, Oompany,' Docket ~o. 6126 , and The Blanton Oompany, Docket o. f)197, entered this da.y, the initial decision is reversed and it is directed that an order issue accordingly.

Kothing contained in the order shall prevent t.he use of representations that respondent's oleomargarine contains butter or other dairy product, provided the statements arc true and provided the percentage thereof contained in the product js clearly and eonspieuously set forth. 1 See p. 1056.

Tn an interlocutory, ruling, J) . 1070., the Commission rc\el' u a decision of the hearing exlt!Iiner folluwing the sulJ!uission of tbe case- iij-f'chief by the counsp.i supporting the f'ullvlaint, g"l'anting rci3pondcnt s motion to r1ismiss the cOilplajnt. In said opinion, the Commission Dotecl that if all the qUp..'tiolled Ilrlycrtisiug had contained fif; full a di.'e!osul'e as to the Dctual ingreuif'nts as SOile of tilC advprth,jng cud, such might hll\-e been sntlf'ient to ne!!ativp. any slJ2;gestion that rf'spondent' s oleomargarine "'. ils fl. dairy product. Complaint 51 F.