Ronald Levine, Also Known as Ronald Loring

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IN THE IA TTER OF RONALD LEVINE, ALSO KNOWN AS RONALD LORING ET AL. , DOING B1)SI~ESS AS STANLEY GIRL COAT CO. AND PRIKCESS NELL GIRL COAT CONSENT ORDER, :ETC. , IN REGARD TO Tile ALLEGED 'VOLATION OF THE FEDERAL TR. DE CO flnSSION .ACT AND OF THE WOOL PROD"CCTS LABELING ACT Docket G269. Cam.pla,int, Dec. 1954-Dccision, Ma.y, 1955 Consent order requiring manufacturers in New York City to cease violating the Wool Products Labeling Act by labeling as "100% Reprocessed Wool " interlinings of girls' coats which consisted of reused wool together with substantial quantities of miscellaneous non-woolen fibers and non-fibrous materials, and by failng to disclose on the labels the name of the manufacturer. Before . Lor-en H. Laughlin hearing examiner. Mr. George E. Steinmetz for the Commission. COl\PLAIX' Pursuant to the provisions of the Federal Trade Commission Act and thc Wool Products Labeling Act of 1838, and by virtue of the authority vested in it by said Acts, the Federal Trade Commission having reason to believe that Ronald Levine, also known as Ronald Loring, and Stanley Levine, also known as Stanley Loring, each individually and as copartners, trading and doing business as Stanley Girl Coat Co. and Princess ~ ell Girl Coat, hereinafter refelTed to as respondents, have violated the provisions of said Acts; and it appearing to the Commission that a proc.eeding by it in respect thereof would be in the public interest, hereby issues its complaint st:ling its charges in that respect as follows:

P ARAGHAPH 1. Respondents Rona.ld Levine, also known as Ronald Loring, and Stanley Levine, also kno\yn as Shtnley Loring, are individuals and copartners trading and doing business as Stanley Girl Coat Co. and Princess K ell Girl Cmlt. The offces and principal place of business of each of said respondents are located at 209 ,Vest 26th Street, New Y or k 1, New York.

PAR. 2. Subsequent to the effective date of the ,Vaal Products Labeling Act of 1838, and more especially since January, 1853, said respond- , trans- ents have manufactured for introduction, introduced, sold in ported, distributed, delivered for shipment and offered for sale, STANLEY GIRL COAT CO. ET AL. 1079 1078 Decision commerce, as " commerce" is defined in saiel Act, wool products, as wool products" are defined therein.

PAR. 3. Certain of said wool products "ere misbranded within the intent and meaning of Section 4 (a) (1) of said "\Vool Products Labeling Act of 1039 and the Rules and Regulations promulgated thereunder, in that they were falsely and deceptively labeled or tagged \with respect to the charrLctcr and amount of the constituent fibers contained therein.

Among such D1isbrandecl wool products ,vero girls' coats containing interlinings, the fiber content of which interlinings were labeled or tagged by respondents as consisting of "100% Reprocessed Wool whereas in truth and in fact the said interlinings did not consist of 100% Reprocessed vVool as the term "Reprocessed vVool" is defined in said act, but consisted of reprocessed or reused wool fibers, together with substantial quantities of misee1Janeous non-woolen fibers and non-fibrous materials.

Par. 4. Certain of said wool products described as girl's coats were further misbranded within the intent and meaning of Section 4(a) (2) of said Wool Products Labeling Act of ID39 and the Rules and Regulations promulgated thereunder, in that they were not stamped, tagged or labeled as to disclose the name or the registered identification number of the manufacturer thereof, or of one or more persons subject to Section 3 of said Act with respect to said wool products. Par. 5. The acts and pra.ctices of the respondents as herein .alleged were and are in violation of the VV 001 Products Labeling Act of 1939 and of the Rules and Regnlations promulgated thereunder, 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:Tf:,HISSION Pursuant to Rule XXII of the Commission s Rnles of Practice md as set forth in the Commission s "Decision of the Commission and Order to File Report of Compliance " dated :vray 7, 1955, the .initial decision in the instant matter of hearing examiner Loren H.Laughlin as set out as fol1Gws, became on that date the decision of the Commission.

lKITIAI DECISION BY LOREN H. LA I7GHLIK , HEARING EXAMINER The Federal Trade Commission (hereinafter referred to as the Commission) on December 22, 1954, issued its complaint under the Federal Trade Commission Act and the Wool Products Labeling Act of 1939 against Ronald Levine, also known as Ronald Loring, and Stanley Decision 51 F.

Levine also known as Stanley Loring, each individually and as copartners trading and doing business as Stanley Girl Coat Co. and Princess Nell Girl Coat, charging them and each of them in several particular"S with having violated the provisions of said Acts and of the Rules and Regulations of the Commission promulgated under said "Wool Products Labeling Act. Said cOlnplaint was thereafter duly served upon each of said respondents, but. said defendants have failed to answer the complaint.

On farch 10, 1955, however, the respondents stipulated in writing with counsel supporting the complaint, therein waiving the filing of an answer and agreeing that. a consent order against the respondents be entercel herein in terms idcntical with those contained in the notice issued and served on respondents as a part of the complaint herein. Such written stipulation was approved in wri6ng by the Director and Assistant Director of the Commission s Bureau of Litigation. By said stipulation, among other things, respondents have admitted all the jurisdictional allegations of the c.complaint and agree that the record herein may be taken as if the Commission had made findings of jurisdictional facts in accordance with such allegations; that the parties expressly waive a hearing before the I-Iearing Examiner or the Commission and all further and other procedure to which the respondents may be entitled under the Federal Trade Commission Act or the Rules of Practice of the Commission; and that the order to cease and desist issued in accordance with said stipulation shall have the same force and effect as if made after a full hearing, the parties having waived specifically therein any and a1l right, pmyer or privilege to challenge or contest the validity of said order. It was also stipulated and agreed therein that the complaint herein may be used in construing the terms of the order provided for in said stipulation, and, further, that the signing of said stipulation is for settlement purposes only and does not constitute an admission by respondents that they have violated the Jaw as alleged in the complaint. The aforesaid stipulation for consent order as so approved ,vas submitted on :March 10, 1955\ to the above-named hearing examiner for his consideration in accordance with R.ule V of the Commission Rules of Practice. And upon due consideration of the complaint and the stipulation for consent order, which is hereby accepted and ordered filed as part of the record herein, it having been stipulated they shall be the entire record herein on \which sllch order may be entered, the hearing examiner finds that the Commission has jurisdiction of the subject matter of this proceeding and of each and both of the parties respondent herein, both individually and as copartners under the STANLEY GIRL COAT CO. ET AL. 1081 1078 Order trade names above stated; that the complaint states a legal cause for complaint under the Federal Trade Commission Act, and the Wool Products Labeling Act of 1939 and the Rules and Regulations promul. gated by the Commission under the Jatter Act against the respondents both as an entirety and in each of the particular violations alleged therein; that this proceeding is in the interest of the public; that the following order as proposed in said stipulation is appropriate for the disposition of this proceeding, the same to become final when it becomes thc order of the Commission; and that said order therefore should be, and hereby is, entered as follows: ORDER IT 18 ORDI RED That the respondents Ronald Levine, also known as Ronald Loring, and Stanley Levine, also known as Stanley Loring, individually and trading and doing business under the several firm names of Stanley Girl Coat Company and Princess Nell Girl Coat, or under any other name or names, and their respec6ve representatives agents and employees, directly Or through any corporate or other device, in connection with the introduction or manufacture for introduction into commerce, or the offering for sale, sa Ie, transportation or distribution in commerce, as "commerce" is defined in the Federal Trade Commission Act and the ,V 001 Products Labeling Act of 1939 of girls' coat.s or other " wool products " as such products are defined in and subject to the ,Vool Products Labeling Act of 1939, which products contain, purport to contain, or in any way are represented as containing "wool reprae-essed wool " or "reused wool " as those terms are defined in said Act, do forthwith cease and desist from misbranding such products by:

1. Falsely or deceptively stamping, tagging, labeling or otherwise identifying such products a.s to t.he character or amount of the constituent fibers included therein;

2. Failing to securely affx to or place on each such product a stamp, tag, label or other means of identification shmving in a clear and consplcuoUS miwuer;

(a) The percentage of the t.total Jiber weight of such wool product cxcJllsive of ornamentation not exceeding five percent-urn of said total , (4) fiber weight., of (1) wool, (2) reprocessed wool, (3) reused wool each fiber other than wool where said percentage by weight pf 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 wool product, of any non-fibrous loading, filling, or adultering matter; Order 51 F. T. C.

(0) The name 01' the registered identification number of the manufacturer of such wool product, or of tmc or more persons engaged in introducing such wool product into commerce\ or in the offering for sale sa.le, transportation, distribution 01' delivery for shipment there4 of in commerce commerec is defined in the 'V Dol Products Labeling Act of 1939.

3. Failing to separately set forth on the required stamp, tag, label or other means of ic1entific.ation, the character and amount of the constituent fibers of the interlinings of any such wool product. Pr' 01)ided That the :foregoing provisions concerning misbranding shan not be construed to prohibit acts permitted by paragraphs (a) and (b) of Section 3 of the Wool Products Labeling Act of 1939; and Provided, further That nothing contained in this order shall be construed as limiting any applicable provisions of said. Act of the !rules and Regulations promulgated thereunder. ORDER '1'0 FILE REPORT OF COJ:fl'LIANCE It is ordered That the respondent.s herein shall ",ichin 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. ("S re- 'luired by said declaratory decision and order of May 7 , 1955J. &\ &, &, &, ARTISTIC CARn PUBLISHL'G CORP. ET AL. 1083 Decision IN 'lnl LATTER OF AR.TISTIC CARD PUBLISHING CORP. ET AL.

ORDER, OPINION , ETC. , IX REGARD TO THE ALLEGED VIOLATION OF THE FEDERAl. TRADE CO::'BIISSIQN ACT Docket .5984. Comp7aint, May 1,JJ- Decision. May, 1955 Order requiring five cOl'pol'ntP manufacturers of g-reeting cards sold by the box directly to the purchasing public by mad or by house-to-house solicitation, t.o cease concertedly fixing prices, q1mntity brackets, and common formulaefO! calculating prices for their products.

Before Jir. F'Tank Ilie1' hearing examiner. Mr. Floyd O. Collins for the Commission. Rabbino Rabbino of New York City, for Artistic Card Publishing Corp., "\Vhite Plains Greeting Card Corp., Colonial Greetings, lnc. United Craftsmen, Inc. and Artistic Card Co.. Inc. Sherburne, Powers Needham of Boston, Mass., for Chilton Greetings Co. and Phillips Card Co.

l' L(nda of \Vashington, D. C. Davies, Rich-berg, Tydings, lJeebe for Dochla Greeting Cards, Inc. and Phillips Card Co. Afr. John I. Robinson of Springfield, Mass., for Card Mart, Inc. M,' . Leroy Stein of Elmira, X. Y. , for Elmira Greeting Card Co. Inc.

Gmndefeld Goodman of New York City, for Hedcnkarnp & Co. 11r. R-richard J. Hatchfield of Brockton, Mass., for Clyde L. Evane a.nd Lawrence E. Evans.

Cooley Cooley, of Springfield, Mass., for Charles E. Schwer and John L. Schwer.

INITIAL DECISION BY FRANK RIER, REARING Examiner On May 8, 1952, the Federal Trade Commission issued its complaint herein, charging the K ational Association of Greeting Card Publishers its Secretary and Managing Director, fOllr members of its Executive Committee, nine manufacturing members and fourteen distributor discountsmembers with agreeing to fix prices, quantity brackets, tenns and conditions of sale, and with separating orders and thereby avoiding consolidat.ion of quantities to avoid lower prices for the larger quantities in a single order, in violation of Section 5 of the Federal Trade Commission Aet.

1 Amend('!1.

Decision 51 F. T. C. After the fiing of answers by respondents, five hearings were held at which testimony and other evidence were introduced in support of the allegations of the complaint by counsel therefor before the above-named Hearing Examiner, theretofore duly designated by the Commission.

At the conclusion of these hearings on March 24, 1953, at which time the attorney in support of the complaint closed his case in chief, and within the time allowed by the Hearing Examiner, respondents moved to dismiss the complaint supported by briefs to which counsel in support of the complaint filed answering brief. Thereafter, the hearing examiner on June 10, 1953, ordered the complaint dismissed for lack of suffcient evidence to constitute a prima facie case against the following respondents: The :National Association of Greeting Card Publishers; Stephen Q. Shannon, individually and as Secretary and Managing Director of respondent Association; Thomas Doran, A. 1. Fidelman, Julian Friede and Charles J. Hedenkamp, individually and as lembers of Executive Committee of such Association; AJ1ed Greeting Card Corporation; Messenger Corporation; National Printing Company, Inc.; Standard Greetings, Inc. ; Mc- Kenzie Engraving Company; Southern Greeting Card Company; Friendship Studio, Inc. ; General Card Company; and V allace Brown, Inc., in the form of initial decision pursuant to the rules of the Commission. Ko appeal was filed to such order and on July 30 1953, the Commission affrmed such dismissal. The motions to dismiss the complaint as to the remaining respondents were denied by appropriate order of the Hearing Examiner on June 10, 1953, from which an appeal was filed on behalf of one respondent, Elmira Greeting Card Co. Inc., but this appeal was denied by the Commission on J uJy 30, 1953. Thereafter, three hearings were held at which the remaining respondents introduced testimony and other evidence in opposition to the allegations of the complaint and the evidence introduced in support thereof, and the case was closed on the record for the taking of further testimony December 15 , 1953. anuary 25, 1954 was fixed as the time for the filing of any proposed findings and conclusions by counsel. Several days prior thereto counsel in support of the complaint notified the Hearing Examiner that he desired to ask the Commission to issue an amended complaint, and thereupon the order fixing time for filing proposed findings and conclusions was set aside.

Thereafter, on 1ay 12 , 1954, the Commission issued its amended complaint, identical with the original complaint except that it omitted the respondents previously dismissed on motion as parties, and added ARTISTIC CARD PUBLISHING CORP. ET AL. 1085 1083 Decision a new distributor respondent, Artistic Card Company, Inc., alleging that its stockholders and directors were the same as those of Artistic Card Publishing Corp., a manufacturer respondent. Thereafter, counsel for all remaining respondents, and counsel for the new respondent stipulated to stand on their ans"\vers filed to the original complaint, as being their answers to the amended complaint, and further stipulated that the record made under the original complaint should be considered as the record under the amended complaint and as the basis of disposition of this proceeding. Proposed findings of facts and conclusions were thereafter fied by all counsel except on behalf of Card Mart, Inc. and Elmira Greeting Card Co. Inc., and the case closed August 6, 1954. l,T pon consideration of the entire record herein and from his observa tioil of the witnesses, the Hearing Examiner finds that this proceeding is in the interest of the public and finds the fads as follows: 1. (a) Respondent Artistic Card Publishing Corp. is a corporation organized and doing business under the lalfs of the State of )iew York with its home offce located at 1575 Lake Street, Elmira ew York. (b) Chilton Greetings Company is a corporate.ion organized and doing business under the laws of the State of lYIassachusetts, having its offce and principal place of business at 147 Essex Street, Boston :i\'assa.chusetts.

(c) Respondent Dochla Greeting Cards, Inc., is a corporation organized and doing business under the laws of the State of Delaware having its principal offce and place of business at :Nashua, New Hampshire.

(d) Respondent \Yhile Plains Grecting Card Corp. is a corporation organized and doing business under the laws of the State of K ew York having its offce and principal pla.ce of business at 1220 Bank Street 1Vhite Plains, New York. Saiel respondent operates its business in two divisions, namely; Thomas Doran Co. and Cheerful Ca.rd Co. The first named division operates the wholesale distribution part of said respondent and the latter handles the retail distribution part of said business. The foregoing respondents are engaged in nul1ufacturing and distributing greeting cards, as hereinafter more fully described to distributors and also, wit.h the exception of Artistic Card Publishing Corp., directly to the public through direct selling agent.s and arc known in the industry as direct sellers. The above-named respondents \\'i11 hereinafter be referred to as manufacturing respondents. 2. (a) Respondent. Card l\:fart., Inc., is a corporation organized and doing business under the lrn\' s of the State of ew York, having its principal offce and place of business at 642. South Summer S. re, Holyoke. Iassllehusetls.

(q) Decision 51 F.

(b) Respondent Colonial Greetings, Inc., is a corporation organized and doing business under the laws of the State of Massachusetts having its principal offce and place of business at 600 Boston Post Road, Greenwich, Connecticut.

(c) Respondent Elmira Greeting Card Co. Inc., is a corporation organized and doing business under the laws of the State of New York having its principal offce and place of business at 501 East Clinton Street, Elmira, New York.

(d) Respondent Phillps Card Company is a corporation organized and doing business under the laws of the State of Massachusetts having its principal offce and place of business at 50 Hunt Street Newton, Massachusetts.

(e) Respondent United Craftsmen, Inc., is a corporation organized and doing business under the laws of the State of Ohio, having its principal offce and place of business at 1400 State Street, Cincinnati Ohio.

(I) Respondent Hedenkamp & Co. Inc., named as Hedenkamp & Company in the amended complaint, is a corporation organized and doing business under the laws of the State of New York, having its principal offce and place of business at 361 Broadway, Xew York New York.

Respondents Clyde L. Evans and Lawrence E. Evans are individua.1s and copartners trading and doing business under the partnership name of New England Art Publishers with their principal offce nncl place or business at X orth Abington, Jfassachusetts. (11) Respondents Charles E. Schwer and John L. Schwer are individuals and copartners trading and doing business under the partnership name of Charles E. Schwer Co. with their home offce and principal place of business at 165 Elm Street, vVestfieJd, 2Yhssachusetts. (i) Respondent Artistic Card Company, Inc., is a corporation 01'ganizcd and existing under and by virtue of the laws or the State of :: ew Yark with its home. offce and principal place of business located at 1575 Lake Street, Elmira, ~ew York. The stockholders and directors of this respondent are the sa.me as the stockholders and directors of respondent Artistic Card Publishing Corp. The above-named respondent.s are distributors of greeting cards buying in excess of 80 percent thereof from the direct sellers described in Paragraph One hereof fOTresale through direct selling agents to the consuming public and will he J1ercinafter referred to as distributor respondents.

3. The ommoditics invoh' ec1 in this proceeding are boxed greeting ('cuds which RTe used by the purcha.sing public throughout the .United ARTISTIC CARD PUBLISHIG CORP. ET AL. 1087 108:, Decision States on such occasions as Christmas, Easter, Fathers Day, Mothers Day, birthdays, funerals, weddings, anniversaries, etc. They are packaged and sold as an assortment in a single box containing fronl 14 to 20 cards each, which cards vary in design, quality, novelty, etc. and which boxes are classified in the industry as Christmas boxes and Everyday boxes. Practically all of these boxes are retailed to the consumer at $1.00 each. A very minor part of the production is able to command $1.25 a box. Tho economic and commercial experience of the industry has been that such boxes cannot he sold to the public in any profitable volume at more than $1.00. 4. The manufacturing respondents, in the course and conduct of their business, manufacture greeting cards as above described and consistently purchase grceting cards from each other to make up these box assortments and sell and ship such box assortments, or cause the E'ame to be sold and shipped, to direct selling agents and to distributors such as and including those named in Paragraph 2 hereof from their respective places of business to such purchasers located in the various States of the United States other than the State of origin of said shipments, and have carried on and engaged in, and do now carry OD and engage iil commerce as that term is defined in the Federal Trade Commission Act.

5. Distributor respondents hftve been, in the regular course and conduct of their businesses, purchasing greeUng cards in boxes from manufacturers thereof including those named in Paragraph 1 hereof to the extent of 80 percent of their requircme,nts or more and causing such merchandise when purchased, to be shipped from the various places of manufacture to their respective places of business and in turn selling and shipping such merchandise or causing the same to be sold or shipped, to direct selling agents, many of whom are located in various States of the United States other than the State of origin of said shipments or the State in which said distributor respondents are located and have carried on and engaged in, and do now carryon and engage in, commerce as the term is defined in the Federal Trade Commission Act.

o. In the course and conduct of their selling, ofiering for sale and shipping in commerce of sa,iel greeting cards packaged as described said manufacturing respondents except for the agreement and under standing hereina.fte.r found, '\vould have been in the past. , and would now be in compet.ition with each other. Said distributor respondents are in competition with eac.h other.

II Whrtber or not the busin€8S of respondents herein amounts to 20 percent or 80 percent of the box eard business (lode In the United States is imroaterinJ. if there wa an agree" ment on price.

423783--58-- 1088 FEDERAL TRADE CO V!ISSION DECISIONS Decision 51 F. '1' . C. 7. It is the custom, and has been for a number of years, of manufacturing respondents, many months in advance of the season for which the cards are intended, to issue price lists in the form of order blanks, one for the Everyday assortment and one for the Christmas assortment. Prices are scaled to quantities and in 1948 these quantities uniformly among manufacturing respondents provided for 65if each on purchass from 1 to 9; 60; each of purchases from 10 to 24; each on purchases from 25 to 49; and 501 each on purchases of ;50 or more. Each of the manufacturing respondents' price lists for the year 1948 are the same as to these prices and quantities. 8. In September of 1948 an informal group discussion among respondents was held following the convention of the National Association at which prices were discm:sed. Although there ,ycre 20 or more representatives at the meeting, only 7 were identified. Four of these present testified and testimony of one was stipulated. Apparently, the cause of this discussion was a 12-25 percent increase in postal rates which would become effect.ive (luring the year of 1949 and since respondents sell entirely by mail this represented a substantial increase in operational cost, and 'ways and means of how to absorb this cost increase by passing it on by price iIlcrease was the principle subject discussed.

9. IIel'man Chilton of respondent Chilton Greetings Company testified that he had a change in quantity discounts (price increase for 1940) pretty well set in his mind and had adopted a plan to increase prices prior to this meeting, and in fact ha.d price scales already made out but. that after hearing the discussion he made one change in those price scales. Another direct seller present at this lneeting testified that the price list he subsequently came out with had the same quantity brackets as were discussed at the meeting. Harry Doehla of respondent. Doehla Greeting Cards, Inc., whose testimony was stipulated, and "hieh company is the largest producer of greeting ca.rds among respondents, said that he announced at the meeting that he was going to increase the quantity requirements necessary for agents to secure discounts; that he anticipated that his distributors would adopt a similar policy, and further, that at that time he had reason to believe that some of his principal competitors were going to adopt an identical quantity discount scale for sales to agents, although he ,"auld not know this for certain until they issued their order blanks several months later. Thomas Doran of respondent 'Vhite Plains Greeting Card Corp. testified that at this meeting he heard specific quantity brackets mentioned; that he liked the idea of the meeting and would put in the prices but not until December when he knew ARTISTIC CARD PUBLISHING CORP. ET A,. 1089 1083 Decision what his competitors were doing. All of them denied that any agreement was reached.

10. 1Within one to five months subsequent to this meeting, price lists issued by respondents show increases from an identical level to a now and increased identical level, and it is assumed that respondents made substantial sales thereafter at these uniform prices. 11. 1Vithout more, this clearly indicates an understanding and agreement among both manufacturing respondents and distributor respondents on prices to be charged to direct selling agents. It has been many times held by the courts that identical prices charged by competitors with evidence of meetings thereof at which prices were discussed, raises a strong and reasonable inference of price agreement. Hesponclents, however, claim that the inference which arises from this uniform, parallel and common action on their pa.rt is destroyed and a contrary inference is established by bvo factors: First, the fiat and uniform increase in postal rates, representing, of course, an operational cost; and second, that distributor respondents who purchase from the manufacturing respondents were already under an economic c.ompulsion to follmv the prices of respondent manufacturers so that agreement to do so would be futile.

12. It appears from the record that manufacturing respondents ,vho design, pictorialize, lithograph or print greeting cards can only nJford to do so ,1'ith a limited number of new ca.rds because it costs in excess of 820 000. 00 to produce one line of cards; consequently, to obtain assortments for box merchandise and to obtain volume, which is economically necessary for sheer existence, each manufacturer buys from other manufacturers. Likewise, it appears from the record that all manufacturing respondents with one possible exception sell to all distributor respondents and that the distributor respondents purchase, like\vise, from each other. It is not economically feasible for distributors to buy quantities of various cards and make up their own box assortments. It further appears from the record that both distributor respondents and manufacturing respondents, with one exception, sell almost entirely through direct selling agents "whose. recruitment is an annual, expensive and competitive process. These direct selling agents, solicited by full-page advertisements in such magazines as Good Housekeeping, McCans and "\Voman s 110me Companion, select their lines of merchandise in accordance with wl1at 3 While it is true that the Artistic Card Publishing Corp. did DOt if'sue price lists and did not sell to direct sellng ugcnts, the Artistic Card Company, Inc. did do so, fliHl since these two respondents have the slime management and ownersl1ilj, the etrect is the same, H is immaterial in this proceeding whether a managcment group takes an action with its right hand or its left.

, .

Decision 51 F. T. C. they think they can sell best to the consumer and shop around among manufacturing respondents and distributor respondents for samples of the lines of each, frequently selling one line one season and another line another season. They sell to the USer by mail, personal solicitation and through social groups.

13. The unculltradicted evidence in the record shows that although no formal announcements are customarily made by manufacturing respondents to that effect, nevertheless, it is well understood in the industry that a manufacturer will not sell to a distributor who in reselling undercuts pricewise that manufacturer s prices to the latter own direct selling agents, and that the manufacturers advise, distributors as to the prices such manufacturers will charge their direct selling agents. Obviously, a manufacturer could not obtain direct selling agents if the Jatter could purchase t.he same box assortment from the distributor for less than he would have to pay the producer of such box assortment. Distributors, consequently, must maintain the same resale prices to direct selling agents as their suppliers do or they will be unable to obtain a suffcient volume of boxed greeting cards to remain in business. The record reveals that from 80 percent to 95 percent of purchases of these responllent distriblltors are made from tho four manufacturing respondents remaining in this proceeding, and that the other 5 percent to 20 percent of their purchases made from other manuf wturers, would not sustain them in business. 14. This economic picture, which is uncontradicted in the record raises an equally, if not more reasonable, inference that there was no understanding or agreement, on the part of distributor respondents upon prices, Or stated otherwise, the quantity brackets at which these greeting card boxes would be sold. It is a well knmvn fact of ordinary life that businessmen generally do not engage in futile acts, especially here there is a definite risk of expense and public embarrassment. The inference of agreement arising from the testimony hereinabove set forth is destroyed by the hck of necessity for such agreement, or stated otherwise; by the established fact that the purpose of such an agreement had already been accomplished by the economic facts of life pertinent to t.his industry.

15. The claim of respondents that the increase in postal rates, UJliform in amount and applicable to all respondents, was an economic justification for the increase in price is not sustained. The price increase was identical from a.n identical or uniform level, and such an assertion could not be maintained in the absence of a showing that all respondents had absolutely uniform operational costs in all elements so that an incre.ase in any element thereof would produce ex- , ARTISTIC CARD PUBLISHING CORP. ET AL. 1091 1083 Order ctly the same increase in total operational cost in that a1l respondents shipped the same quantities by weight, the same distances. Evidence of operational costs was offered by only one respondent manufacturer and this, in the form in which it was presented, being by conjecture or forecast based on past averaging, fell far short of producing or justifying the price increase made in 1949. 16. The inference of agreement among the four manufacturing respondents, therefore, had not been refuted or explained on the economic or any other basis and it is therefore found that in September 1948, or shortly thereafter, manufacturing respondents Artistic Card Publishing Corp., Chilton Grectings Company, Doehla Greeting Cards, Inc. , and "White Plains Greeting Card Corp. did enter into an agreement or understanding between and among thernselvesto fix the prices, terms and conditions, including uniform identical quantity brackets for pricing purposes of the boxed greeting cards which they sold, and since Artistic Card Company, Inc., has the same stockholders as Artistic Card Publishing' Corp., it is found by reason of such common ownership and control to have been a party to such agreement.

17. There i.s no evidence to support the charge in the complaint that any respondents have by agreement 01' understanding "separated and thereby avoided consolidation of orders with the effect of avoid. mg lower prices applicable to the larger quantities which would have been involved in consolidated orders" or that they have "separated quantities and thereby avoided consolidations of quantities in different price classes in a single order with the effect of avoiding the lower prices which would have been applicable by reason of the greater quantities. "

ORDER It is ordered That respondents, Artistic Card Publishing Corp., a corporation, Chilton Greetings Company, a corpora60n, Doehla Greeting Cards, Inc. , a corporation White Plains Greeting Card Corp., a corporation, doing business in its own corporate name or in the name of its division, Thomas Doran Co., or any other name Artistic Card Company, Inc. 4 a corporation, and the offcers, agents employees and representatives of each of them, directly or indirectly, jointly or severally or through any cop orate or other device, in Of in connection 'with the oflering for sale, sale, or distribution of greet- :ing cards in interstate commerce, as "commerce" is defined in the 4 Since .Artistic Curd Publishing Corp. and Artistic Card Compfiny, Inc. have common 0wncrship, direetloll and control, !lny order against one alone could be easily ignored by the other, therefore both ure included. The onc Is the alter ego of the other. Appeal from Initial Decision 51 F. T. C. Federal Trade Commission Act, do rorthwith cease and desist from engaging in, entering into, participating in or carrying out any planned common course of action, understanding, agreement, combination or conspiracy between any two or more of said respondents or between anyone or more of said respondents and another, or others not parties hereto, to do or perform any of the following acts or things: fixing or establishing prices at which said greeting cards are to be sold or oiIered ror sale, fixing or establishing quantity brackets fixing or establishing any common method or formula for calculating prices or using any such method or rormu1a so established or fixed and from holding meetings at which prices, terms, conditions of sale or trade practices or policies designed to eliminate competition in price or otherwise are discussed or acted upon. It is further ordered Tho t an motions to dismiss this proceeding as to them, filed by the above-named respondents, be, and the same are hereby denied.

It is further ordered That this proceeding be, and the same hereby , dismissed as to respondents Card 1art, Inc., Colonial Greetings Inc., Elmira Greeting Card Co., Inc., Phinips Card Company, United Craftsmen, Inc., Hedenkamp & Co., Inc., an corporations, and as to respondents Clyde L. Evans and Lawrence E. Evans, copartners doing business under the partnership name or New England Art Pnblishers and as to respondents Charles E. Schwer and John L. Schwer, copartners doing business under the partnership name of Charles E. Schwer Co., and motions to that end, filed by these respondents, are accordingly granted.

Ox Appeal Fmnr INITIAL DECISION Per CURIAJ\I :

STAIT IEXT OF THE CASE On Jay 8\ 1952, complaint i sued herein charging The K ational Association of Greeting Card Publishers, its Secretary and )1:anaging Director, rour (4) members or its Executive Committee, nine (9) manufacturing members Hnd fourteen (14) distributor members with violation of Section 5 of the Federal Trade Commission Act through (a) agreeing to fix prices, (b) agreeing to fix quant.ity brackets, (c) ngreeing to fix discounts, (d) agreeing on terms and conditions of sale, and (e) separating orders and thereby avoiding consolidation of quantities to avoid lower prices for larger quantities in a single order. On March 24 , 1933 , counsel in support of the complaint closed his case in chief and respondents moved to dismiss. Briefs in support of and in opposition to these motions were filed. ARTISTIC CARD PUBLISHING CORP. ET AL. 1093 1083 Appeal from Initial Decision On June 10 , 1953, the hearing examiner in an initial decision dismissed the complaint for failure to establish a prima facie case against the National Associa6on, its Secretary and General :Manager, the four (4) members of its Executive Committee, five (5) manufacturing members and four (4) distributor members. No appeal therefrom ,vas taken except by one distributor member, Elmira Greeting Card Co. The latter s appeal was denied by the Commission on July , 1 D5;- , and on the snme date the Commi....ion affrmed the dismissal.l of the complaint as ordered by the hearing examiner s initial decision of J line 10 , 1 $)5;-3.

After further hearings and the introduction of evidence, the case was closed on the record for the taking of further testimony Decembel" 16, 1963. Prior to expiration of the time for the filing of proposed findings and conclusions by counsel, the attorney in support of the complaint moved the Commission to issue an amended complaint. identical with the original complaint except that it omitted respondents previously dismissed as parties, and added a new distributor respondent Artistic Card Company, Inc., alleging that its stockholders and directors ,were the same as those of Artistic Card Publishing Corp. , a manufacturer respondent. The Commission granted that motion and thereafter on fay 12, 1954, the amended complaint. issued.

By agreement between counsel it was stipulated that respondents named in the amended complaint would elect to, and did, stand upon answers filed to the original complaint and it ,vas further stipulated ihat the record made under the original complaint should be considered the record under' the amended complaint and as the basis for disposition by the hearing examiner of the proceeding. In clue course motions to dismiss were filed and the case ,,,as closed August , 1954, the hearing exa.miner having previously stated on the record that said motions to dismiss would be disposed of in his initial decision on the whole record.

On August 11, 1954, the he trjng examiner filed his aforesaid initial decision dismissing the complaint as to the remaining distributor corporations and partnership (in effect granting their motions to dismiss, previous)y filed) and holding that the manufacturing corporations and affliates had engaged in the unfair methods of competition and unfa,ir acts and practices alleged (in eued denying the latter motions to dismiss, previously filed).

Counsel in support of the complaint appealed from that part of the hearing examiner s initial decision dismissing the complaint as to the distributor respondents. Counsel for manufacturing respond- The Facts 51 F. T. C.

ents Artistic Card Publishing Corp. (Artistic Card Company, Inc. Chilton Greetings Company, Doeh1a Greeting Cards, Inc. , and Vhite Plains Greeting Card Corp. also appeaJed in toto from the initial decision, filing numerous exceptions and a1Jegations of error on the part of t.he hearing examiner thi'ough his failure to adopt certain findings. These manufacturing respondents "In the event that Hesponclents' Appeal from the Init.ial Decision in toto should not be sustained, * * * appeal from the form ilnd substance of the Order thereto appended and urge that such Grdn' E;should be modified in jhe respects hereinafter urgerl. Briers were flied, oral argument "\YHS heard by the Commission on :February 1 , 1955, and the case was taken under advisement.

STATEl\IENT OF FACTS This proceeding involves the manufacture. and distribution in commerce, as that term is defined in the Federal Trade Commission Act of boxed greeting cards, packaged as single box (l,ssortments of from 14 to 20 cards each, for sale to consumers by "direct selling agents (door to door salesmen, church, school and civic. organizations, etc. at the customary and traditional price of Sl.OO per box. Not involved Nte is that seg1nent of the industry which manufactnres and/or sells greeting carus through retail stores. The cards are used by the purchasing public on Christmas, J\'ew Year, ERster, Father s Day, Mother s Day, birthdays, funerals, weddings, anniversaries, etc. The manufacturing respondent.s create design, print and seu boxed assortments to each other and to the distributor respondents. :Manufacturing respondents and distributor respondents sell in competition with each other to the "direct selling agents." It is the pricing practices at this level of distribution that are involved here. The greeting card industry has two seHing seasons, one for the Everyday assortment and one for the Christmas assortment. It has been the custom over a period of years for manufacturing respondents to issue many months in advance of each season price lists in the form of order blanks. Prices are quoted by manufacturing respondents to quantity schedules; and in 1948 all manufacturing respondents involved here uniformly quoted the price for each box to " direct seIJing agents" as :

each for 1 to 9 boxes each for 10 to 24 boxes each for 25 to 49 boxes each for 50 boxes or more.

ARTISTIC CARD PUBLISHING CORP. ET AL. 1095 1083 Appeal In the summer of 1948, pursuant to statutory authority, the Post Offce Department announced parcel post rate increases to become effective January 1 , 1949, which would result in rate increases for manufacturing respondents of from 120/0 to 25% in different eategories and proportionally direct increases in their operational costs. Thereafter, in September of 1948, informal group discussions among respondents were held following the convention of the 11 ational Association at which prices and ways and means of how to meet this increased operational cost were the subject. In these groups specific changes in quantity brackets were discussed. The hearing examiner found the facts to be substantially as briefly recitcd above and further found as an ultimate fact that, within one to five months subsequent to the September meeting, price list order blanks issued by respondents (both manufacturers and distributors) showed increases from an identical level to a new and increased identical level. In this connection, the hearing examiner reviewed the evidence bearing upon the activities and discussions at the September gathering and for det.ails in that connection reference is made to his initial decision.

The new, and uniform, price list promulgated subsequent to the September 1948 discussions was as follows:

651 each for 1 to 19 boxes 601 each for 20 to 49 boxes 551 each for 50 to 99 boxcs 501 each for 100 boxes and over.

APPF.AI.. OF COUNSEL SUPPORTING CQ3IPL.NT Counsel in support of the complaint has appealed from that part of the initial decision wherein the hearing examiner in effect dismissed the complaint as to distributor respondents by granting motions to that end fied by those respondents. Specifically, in this appeal, exinci-ception is taken to Paragraph 14 of the initial decision and, dentally, to the form of order to cease and desist, insofar as it fails to include the distributor respondents.

Paragraph 14 of the initial decision, to which counsel supporting the complaint excepts, in substance is a finding that the facts disclosed in the record raise a reasonable inference that there was, on the part of distributor respondents, no understanding or agreement upon prices or quantity brackets at which greeting card boxes would be sold.

There is in the record evidence that manufacturing respondents sell , alsoto each other and to a,ll distributor respondents who, in turn Appeal 51 F. T. C.

purchase from each other. Both distributor respondents and manu. facturing respondents, in COI'npetition with each other, sell through direct selling agents. "'while the record discloses no formal a nOllllcement to that effect, it is well understood in the industry that a manufacturer will not sell to a distributor who resells to direct sell ing agents at prices less than the manufacturer sells to direct selling agents. If the distributors did sell for prices under those of the manufacturers, the former, it is obvious, .would have no source of supply. It follows that, of necessity, distributors 11nst maintain the same resale prices to direct selling agents a the manufacturers clo. The inference of agreement on the part of distriblltors jf any such inference be considered as reasonably arising from testimony regarding the" September 1848 events, is, 1n our opinion, dissipated by the complete lack of any necessity for such agrpement. The distributor respondents had no alternative but to maintain the resale prices to direct selling agents that they did, ill order to remain in business. The hearing examiner has weighed the evidence on this score, including the demeanor of \vitnesses testifying before him, and found no agreement by distributor respondents. On the "' hole record we agree with him that the economic picture, in the circumstances peculiar to this industry, supports the conclusion. The exceptions taken in this connection must fall and the appeal of counsel supporting the complaint should be denied.

RESPOXDEXTS ' APPEAL IX TOTO (a) Assignments of E1'1'01' Respondents assign as error the hearing examiner s l'ldusal t.) adopt seven specific proposed findings and t.he conclusions of law submitted by respondents. Respondents also except, in whole or in part, to certain designated paragraphs of the, initial decision. At the outset respondents contend that the examiner erred in refusing to adopt findings concerning the weight and eflect to be given to the testimony of a disinterested ,,,itness (Sugden) that no agreement was entered into by respondents at their discussions in September, 1948. The law is ,veil settled that no formal agreement is necessary to constitute an unlawful com piracy. In circumstances where as here, identical prices were charged by competitors after thc holding of mcetings at which prices were discussed the hearing examiner was fully justified in concluding that a conspiratorial price agreement did in fact exist. The testimony of the witness relied upon as a basis for the contrary finding proposed by respondent. was wholly insuffcient ARTISTIC CARD PUBLISHIXG CORP. ET AL. 1097 1083 Appeal to overcome this inference, and the hearing examiner s refusal to adopt such finding cannot be said to have been erroneous. Respunclent assignment of error in this respect, accordingly, is overruled (Respondents' Appeal Brief, Point III). Our ruling here is equally applicable to respondents ' assignment of error on the hearing examiner s part in refusing to adopt findings that there is no evidence of any agree- :ment, understanding or planned commOll C'our e of actioll a to prices terms or conditions of sale, including unifonn quantity dii:count hrackets to dealers. This assignment of error (Respondents' Appeal Brief, Point IX) also is overruled.

Hespondents further contend it was error for the hearing examiner to refuse to adopt proposed findings to the effect that (a) price uniformity existed prior to the alleged conspiratorial meeting in September, 1948; (b) that usually and normally the dealer prices of each publisher legitimately were available to other publishers prior to the printing of price lists each 11e"\Y season; and (c) that Doehla Greeting Cards, Inc. was the largest publisher in the direct selling field, the first. to announce dealer prices each season: awl that other publishers awaited such anllouncement be:ore establishing their own dealer prices. If, in fact, the uniformity in respondents' price lists subsequent to September 1948, was the result of an agreement and understanding as to prices, it makes 110 cliffel'"llCC what the pre-existing circumstances were as to price uniformity, availability of competitors pric.es, Doehla s predominant size in the industry, etc. Proposed iindings on the enumeraied points, therefore, ,were immaterial in the face of the hearing examiner s finding that nulawful combination did obtain. \Ve conclude, and find, that the hearing examiner correctly refused to adopt these proposed findings (Respondents' Appeal Brief Points IV, V and VI).

Respondents except to the hearing examiner s characterization of the increase in quantities required to be purchased in order to qualify this cha.racterization offor discounts as an ;'increase in price." If the unifol'll changes in quantity discollnt schedules by manufacturing respondents is subject. to the interpretation placed upon it. by respond- €nts-that in all instances after 1948 aJ! purchasers of all quantities '''ere required to pay increased prices-it is probably inaccurate. If that is what it Ineans, then to that exent respondents' exception probably is well taken. If 110we\'er, as the Commission understands it the characterization of t.he change as an "jllc.rease in price" means that purchasers of given quantities before 1948 had to pay increased prices after 19M3 011 the same quantities (except in the case of purchasers in quantities of from 1 to 9 Loxes aud from 20 to 24 boxes), then the Appeal 51 F. T. C.

characterization is both accurate and appropriate. The Commission so interprets the term "increase in price.

In this same connection respondents also a,ssign as error the hearing examiner s failure to adopt Doehla s proposed Finding 39 (a) to the effect that the increase in the minimum number of boxes of greeting cards required to be purchased in order for dealers to qualify for the maximum discount did not result in any dealer paying any more than he had under the previous schedule, provided such dealer ordered somewhat larger quantities than he had previously, except that the smallest dealers, who buy 9 boxes or less per order and dealers who purchased from 20 to 24 boxes per order, encountered no increase whatever. While this proposed fmding may be considered as stating the facts, these facts do not upset nor disturb the conclusion that there had been a conspiratorial tampering with the quantity purchase schedule. It is thus appa.rent that the hearing examiner s rejection of this proposed finding was in nowise prejudicial. In view of the foregoing, respondents' exception is denied and its assignment of error in this connection is overruled (Respondents' Appeal Brief, Point VII).

Respondents contend also that the hearing examiner erred in refusing to adopt a finding to the effect that Doehla s parcel post cost for 1949 increased 12% on the per dollar of sales basis and 13.5% per box sold basis over 1948 costs. In the initial decision it is clear that the hearing examiner fully considered the evidence adduced with relation to this proposed finding, weighed it and expressly found that Evidence of operational costs, in the form in which it was presented, being by conjecture or forecast based on past averaging fell far short of producing or justifying the price increase made in 1949. " On the record as made the hearing examiner was justified in rejecting this proposed finding as "unreliable." In our opinion, the pertinent evidence based as it is on conjecture and forecast projected on past averaging was inconclusive, speculative and, therefore, unreliable. IVe so find (Respondents' Appeal Brief, Point VIII). (b) Respondents' Exceptions vVe turn now seriat11n to respondent' s except.ons which are directed to the whole, or part, of specific paragraphs of the hearing examiner initial decision.

R.respondents except to the hearing examiner s statement in Paragraph 4 of the initia.1 decision to the eife.ct that manufacturers purchase greeting cards from each other to make up box assortments. A correct statement would be that manufacturers purchase boxed assort- ARTISTIC CARD PUBLISHING CORP. ET AL. 1099 1083 Appeal ments of cards from each other to fill out their various lines for resale. Technically, this objection is well taken and the exception is granted without, however, changing the result herein (Respondents' Appeal Brief, Point XI).

Respondents except to the following part of Paragraph 5 of the initial decision:

Distributor respondents have been purchasing greeting cards in boxes from manufacturers thereof, including those named in Paragraph 1 hereof, to the extent of 80 percent of their requirements or more The contention is that, as written, this gives rise to a misconception. Obviously, as stated by respondents, what was meant was that these distributors purchase greeting cards in boxes from manufacturers thereof named in Paragraph 1 hereof, to the extent of 80 percent of their requirements or more The hearing examiner recognized this in the last sentence of Paragraph 13 of his initial decision where he found: The record reveals that from 80 to 95 percent of purchases of these respondent distributors ate made from the four manufacturing respondents "'Ve grant this exception, noting, however, that such action does not affect our ultimate disposition of the appeals herein (Respondents Appeal Brief, Point XII).

Respondents except to Paragraph 6 of the initial decision to the extent it states respondent.;publishers are not. in competition ,vit.h each other. vVe think the record discloses that, except for the agreement and understanding found by the hearing examiner to exist! the manufacturing respondents would be in competition with each other pricewise. The ultimate fact found! however! is that through agreement and understanding price lists issued by respondents showed increases from an identical level in 1848 to a l1e\V and increased identical level in J949. Respondents may be considered to have remained on a com petitive basis insofar as service and quality! among other things, are involved! but not as to price. Hespondents' exception in this respect is denied (Respondents' Appeal Brief Point XIII). Respondents except to the second sentence of Paragraph 9 of the initial decision reading as follo,'Vs :

"Another direct seHer present at this meeting testified that the price !ist he subsequently came out with had the same quantity brackets as 'were discllssed at the meeting.

, noo FEDERAL TRADE COMMISSION DECISIONS 51 F, T. C. Appeal It is respondents' contention here that the hearing examiner intended to refer to a "Publisher-nespondent" rather than to a " direct seUer that what the examiner has done is to take the testimony of a distributor and make it appear as testimony of a publisher as a basis for his ultimate conclusion of conspiracy.

The term "direct seller is used in the industry to describe a "publisher-respondent." The initial decision ' so finds with regard to respondent vVhite Plains Greeting Card Corp. and the hearing examiner had reference to the testimony of Thomas Doran of Thomas Doran Co., a division of manufacturing respondent White Plains, who testified that he was a manufacturer of greeting cards as weU as a distributor " and that the price list he subsequently came out with had the same quantity brackets as were discussed at the meeting. Respondents' exception on this point is, therefore, without merit and is denied (Respondents' AppeaJ Brief Point XIV). Respondents except to the first sentence in Paragraph 11 of the initial decision which concludes that record evidence of the fact that prices were discussed in the September, 1948, groups, plus the established fact that prices subsequently actuaUy were increased uniformly from one identical level to a new identical level 1Vithollt more clearly establishes that an understanding existed to agree on prices to be charged direct sellng agents.

respondents except to use of the phrase ",Vithout more" by the hearing examiner and contend he had no right to conclude there was nothing more, by ,vay of eyidencp, relevallt. to the inference of conspiratorial price agreement. Respondents, in this regard, rely principally on the testimony of Sugden, a. disinterested witness, and upon the related contentions made in connection with their Point III attacking the hearing examiner s refusal to adopt lindings as to the weight and effect of Sugden s testimony that no agreement was entered into at the September, 1948, meeting.

vVe have already determined above that in the circumstances disclosed by the record the hearing examiner correctly concluded that an unla wfuI conspiratorial price agreement existed and that the rejection of the respondents' proposed finding to the contrary was not erroneous. Respondents' exception to the phrase "'\Tithout more " and its concomitant inference that there was eollusive price agreelnent must, t.therefore, be denied (Respondents' AppeaJ Brief Point XV). Respondents except to Paragraph 16 of the in;tial decision which in substance is a finding that since the inference of agreement among the InitJIlJ Decision PurflgrHph 1 Irl).

Transcript 138.

; 'Transcript 142.

, ARTISTIC CARD PUBLISHDJG CORP. ET AL. 1101 1083 Appeal four manufacturing respondents had not been refuted nor explained the latter, therefore did enter into an agreement or understanding between and among themselves to fix the prices, terms and conditions including uniform identical quantity brackets for pricing purposes of the boxed greeting cards which they sold. " Our rulings above on respondents' assignments of error (Respondents ' Appeal Brief, Points III, IV, V, VI and IX) adequately dispose of this exception to Paragraph 16 of the hearing examiner s initial decision and it is denied (Respondents' Appeal Brief, Point XVI).

R.respondents have appealed generally from the initial decision and generally from the hearing examiner s action on their proposed fuldings. They, the respondents, hitve termed this their "Appeal from the Initial Decision in toto." Our rulings so far dictate respondents appeal in toto should be denied.

UEoPO DENTS ' APPEAL IN Tile ;\LTEHKATE FROM FORTI OF OUDEH Having disposed of respondents appe,al in toto from the initial decision "-e now turn to l'e,spondents' appeal from the form and substance of the hearing examiner s order to cease and desist. This portion of respondents' appeal is in t". O parts. Fh' it is contended by respondents that the hearing examiner acted improperly and unjustifiably in including within the ambit of the order to cease and desist "the officers, agents, employees and representat.ives of each of t.hem (corporate manufacturing respondentsJ." Respondents cite in support of this contention the decision of the United States Court. of Appeals for the Seventh Circuit in the Reynolds Tobacco Co. case 8 that the COHnnission s inclusion of "offcers, agents and employees" in an order to cease and desist WRS unjustified. Subsequent to that decision, we held in the matter of II ato Oompany, Inc. that the decision of the United States Supreme Court in the Regall(nitwew' Co. case 10 "fuDy disposes of the issue in this matter until such time as the Supreme Court shall speak further on the question. " The Supreme Court has not ruled further aud no compelling argument has been presented here that persuades l1S to reverse the Hato C/o'tpan.y, Inc. cleeision. The hearing examiner 'was correct in ruling that the order herein should run against the "offcers, agents employees and representatives of the corporate manufacturing respondents. Respondents appeal from this, U1illg accordingly, should be denied.

Reynolds Tobacco Co. v. F. HI2 F. 211 :::-J5 (1951). In the Matter oj Ratio CUTnpany, 1/1r. et ar. Docket No. 51'07 (Decided OC'tohf'r 6. 1952). 1" Regal Kn.it1tear Co. v. J.. L. R. E. 32;: U. s. 9 (1945). , Appeal 51 F. T. C.

Secondly, we turn to the respondents' appeal from the hearing examiner s failure to include saving clauses in the order to cease and desist so as properly to limit its scope. Respondents did not request the hearing examiner for the inclusion of these exclusionary provisos. The proposition was, however, incorporated in their appeal brief and although not pressed in oral argument before us, wil be disposed of here for the record.

Hespondents seek inclusion in the order of three provisions which in effect, would assure that the inhibitions of the order shall not be construed to prohibit:

(1) Agreements on prices, terms, or conditions of sale independently offered and accepted by a buyer and a seller when such agreements are bona fide and are not made for the purpose nor have the effect of restraining competition;

(2) The maintenance of a bona fide relationship between principal and agent;

(3) Agreements, discussion or other aclron between a corporate respondent and its offcers, or between a corporate respondent and its subsidiaries or affliates relating solely to the business of such corporate respondent and its subsidiaries and affliates when not for the purpose or with the effect of restricting competition. Respondents argue that-such provisosal'c necessary because the part of the order immediately preceding the ennmeration of inhibited activities forbids:

"* * * any planned common course of action, understanding, agreement, combination, or conspiracy between any two or more of said respondents and another, or others not parties hereto * * * and state that the purpose of such provisos is to protect the rights of individual respondents to carryon the.ir normal business relationships.

We believe the provisos sought to be included in the alternative in the order to cease and desist herein are unnecessary. This question of the inclusion of such provisos in Commission orders was dealt with hy the Seventh Circuit Court of Appeals in the case The Milk and Ice Orean?, Can Institute et al. v. F. T. C.ll where it was sought to amend a Commission order hy inserting a proviso permitting respondents to do independently that which they were enjoined from doing conspiratorially or by agreement. On the precise problem presented here the Court t.here said:

11152 F. 2tl 475 (c. C. A. 7, 1946).

RTISTIC CARD PUBLISHING CORP. ET AL. 1103 10R3 Conclusion It is argued, among other things, tlw,t the order prohibits lawful action, disassociated from a conspiracy to fix prices, that it is indefinite in its terms and that it is sllsceptible of the c.construction that it prohibits independent action by petitioners. 1Ve are convinced from a st.udy of the order thflt there is little, if any, merit in the criticism made conc.erning it. The order provides that respondents (petitioners here) clo forthwith cease and desist from entering into, continuing, coop €rating in, or carrying out any planned common course of action mniual agreement, understanding, combination, or conspiracy between and among any two or more of said respondents or between anyone or more of said respondents and others not parties hereto, to do or perforll any of the following acts or practices ' * * * It will be noted t hat each of the prohibited acts is directed solely at price fixing in connection with an agreement or conspiracy. It is not a valid criticism to say that they are enjoined from the activities mentioned when used independently 01' even by an agreement unrelated to the price structure. The Commission in its brief concedes what We think :is obvious: tis Iwholly unnecessaJ'y that the ordej' be mnended so as to expTe8sly esej"ve to petition nets theit Tight8 of independent action. They have thow 1iqht8 regardless of the o'/lel' and those 1' 7:ghts 1.UOltld not be r-wnr/cd 01' protectr:din /he 7ca8t by adding such a PT01iiso. The time when such questions should properly be determined is not in connection with the present consideration of the order but whenever the order is alleged to have been violated by 11 given set of facts. If those facts embody a condition of independent action it: will be a perfect defense. The Commission k110\YS as well as petitioners that no violation of the order in its present form can be established by any showing of independent action :I '" , , (Halics provided. For the reasons sLateel by OIB Court above, respondents' appeal in this regard here Sh0111c1 be denied.

COXCLDS!OX ",Ve have fully considered the entire record herein, including the transcript of hearings, exhibits, briefs of both parties and oral argument of counsel before the Commission.

For the reasons hereina.hoye stated we conclude, that the hearing examiner s initial decision is correct, that the appeal t.therefrom of counsel in support of the complaint. and the appeal of respondents Artistic Card Publishing Corp., Artistic Card Company, Inc., Chilton Greetings Company, Doeh1a Greeting Cards, Inc. and l,Vhite Plains Greeting Card Corp. from the initial decision, together ,,,ith the exceptions and assignments of error thereto filed by both sides, includ- 423783- 58- Order 51 F. T. C.

ing the said respondents' assignment that the hearing examiner erred in refusing to adopt their proposed conclusions of law, are without merit (except as hereinabove noted in some minor respects) and that such appeals should be, and they hereby are, denied. Accordingly, the initial decision of the hearing examiner wjJ be affrmed and appropriate order will be entered.

Commissioner Howrey did not participate in the foregoing for the reason that he did not heal' oral argument herein. rn,T AL ORDER This matter having come before the Commission on appeals from the hearing examiner s initial decision filed by counsel jn support of the complaint and on behalf of respondents Artistk Card Publishing Corp., . Chilton Greetings Company, Doehla Greeting Cards, Inc. 'Vhite Plains Greeting Card Corp. , a,nd Artistic Carel Company, Inc. and the matter having been heard on briefs and oral arguments; and the Commission having rendered its decision denying the appeals and affrming the initial decision:

It is O1ylered, That the aforesaid respondents shall, within sixty (60) days a.after service . upon them of this ordcr, file 'with the Commission a. report in writing, setting forth in det.ail the manner and :form in which they have compJiecl with the order cont.ained in said initial decision.

Commissioner Howrey not participating for the reason that he did not hear the oral argument.

, .

CROWN ZELLERBACH CORP. 1105 Opinion Ix THE l\JATTER OF CROWN ZELLERBACH CORPORATION ORDER AXD Oli::ron Docket 6180. Complaint, Feb. 195J,-Onler Ha.y 16, 1955 Interlocutory order in Sec. 7, Clayton Act, proceeding denying the appeal of counsel supporting the complaint from the bearing examiner s order sustaining respondent' s objections to the receipt into evidence of Commission Exhibit 62 for identification, and remanding the case for further proceedings; Holding also I. That said Exhibit 62, the tabulation or sUlyey of sales of coarse paper before and after the challenged acquisition of a competitor, was not objectionable as hearsay: awl II. That the Commission s order of Jan. 18, 1855, was unnecessarily restrictive, and ill lien thereof Ordering that the work papers used in compiling aforesaid survey be made available to respondent at the discretion of tile bearing examiner, with the provision that no information that conh1 be identified with the reporting compHuies should be admitted into the public record. Before iiii' . Earl J. l(olb hearing examiller . L . E. CTeel, J1'. , ilh. J. Wallace Adaip Jh. Dwight J:. Ca"hai' anel LlIi' . lV7:7liaJn R. Jla1ianna for the Commission. 311'. Phih"p S. EIL'l/eh and 111'. Philip S. Ehrlich, Jr. of San Francisco: Calif. , anel S'ldlh:an Cl'ounce17 of Xe,y York City, for the respondent.

Oli no::' OF THE cO:\I:urSSI(x ' GWYXXE , Commissioner:

This is an jnterlocntory appeal by counsel supporting the complaint. The questions involved have to do with a tabulation identified as Commission 's EJ hibit 62.

The complaint charges respondent (which is engaged in the business or proclueing and selling pulp, paper and paper products) with violat.ion of Section 7 of the Clayton Act in connection with the acquisi60n of St. IIelcns Pulp &. Paper Co. Subsequent to the issuance of t.he complaint, the Federal Trade Commission, by resolution, authorized the Bnreau of Economics to collect c1ata R::certain market characteristics, and prepare statisticnl compilations for use in this proc.eeding. A-f the hearing Dr. Irston n. Barnes an economist of the Federal Trade Commission in charge, of developing the economic ",york relating to Section 7 matters, testified that he had c.charge of the carrying: ont of the able8 resolution and he related in detail vllrious steps taken under his supervision. lie t(' tjIied in suhstance that St. !-1elens lwc1 110G FEDERAL TRADE COMNIISSIO DECISIONS Opinion 31 F.

reported 98% of its sales in the ,Vestern and Paeifi" States were convert.ers and jobbers. Questionnaires were prepared classifying the arions papers formerly manufactured and sold by St. Helens into certain specified types. The qnestionnaires to converters classified the products into eight types of coarse paper; those to jobbers covered six types of coarse paper and three types of coarse paper products. Both jobbers and converters "ere instructed to show the doJlal' volume of such purchases from each nalled supplier of such products fo!' specific, periods of time, both before and after the acquisition. If the. C011panis records e1jd not. supply prices on the product basis specified in the report, estimates based on company records KerB to be used. The Est of jobbers and converters \\as made of from St. Jlclens miles book from respondent' s sales analysis, from Loc1nvood's Directory of the Paper & Allied Trades for 1953 and from other SOllrces. Some wholesale grocers were also incJurled. Answers to the questionnaires were required to be certified by an offcer of the corporation. Reports received were tabulated both as to dollar voJmne and percentage of aggregate sales by each supplier shown in the reports. At the conclusion of the direct testimony of Dr. Barncs, the tabulation (Commission s Exhibit G:2) was oflered in evidence. Respond- PIlt objected on the ground that the basic material on \which the survey was based had not been made available for cross-examination. The 1-Iearing Examiner ruled that ullJess the material were. made available, it would be necessary to sustain the objection. At that point an adjournment was taken and cOllnsel supporting the complaint took IIp with the Commission the matter of authorizing the respondent to make some examination of the reports.

On Janllary 18 1955, the Commission directed the Bureau of Economics to transmit the records to the Bureau of Litigation w.ith aut.hority to make the data available to counsel for respondent under the following conclitjons:

(1) It shall be made "vailable to such counsel in the ,Vasbington Oflce of the Commission solely for inspection and for use during the t:examination of the "witness or witnesses who received and edited the replies and compiled the Survey. No information secured on FTC forms EE-1 or EE-2 that can be identified with reporting companies shall be admitted into the public record for any purpose. (2) The Survey documents shall not be removed from the 1iYashington Offce of the Commission. An employee of the Commission familiar "with the records shall have custody of same at all times during the inspection or other use thereof. He shall have full responsibility for the preservation of such records and shall cool;crate with and assist those using thew : : : :;, :

CROW" ZELLERBACH CORP. 1107 1105 Opinion RespOlldellt insisted that the disclosure permitted under the Commission s order was imlc1equate, which view was sustained by the Hearing Examiner and he entered an order "that the objections of the re,spondent to Commission s Exhibit 62 for identification be sustainer1. The qllestioll inyolyed are (1) Is the tabulation (Commission Exhibit (2) admissible in evidence as an exception to the hearsay rule? (2) Are the limitations placed by the Commission on respondent's examination of t.he questionnaires such as to deny it a fair trial? In the general discussion on hCrll'say in \Vigmore on Evidence, 3rd edition, Volume V, Section 1420 and following, the distinguished author sa s: "The purpose and reason of the hearsay rule is the key to the, f'sceptions to it. ' I-Ie points out that cross-examination " beyond any doubt: the greatest legal engine ever invented for the discover:" of truth . The th oly of the rule is that the many possible sources of inaccuracy and untrustworthiness which may lie undenwath the bare, untested assertion of a witness can best be brought to light and exposed: if they exist: by the test of crossexamination. ut this test, may in a given case be superfluous; that is: not needed or impossible of employment. * * * If a statement has been made under such circumstances that even a skeptical caution "\yollld look upon it. as trustworthy (in the ordinary sense), in a, hjgh degree of probability.y, it would be pedantic to insist on a test whose chirf object is already secured. 1Vigmore concludes that a consideration of two principles has been responsible for most. of t.he hearsay exceptions. These principles are first the ril'CllTlstantial probability of t1'list,yorthiness and, second the necessity for the evidence.

These principles have been considered and applied in n, great variety.y of cases, many of \dlich are cited in the briefs. For exa.mple, t.abulations o ' surveys made by a competent witness have been a.dnlittec1 in evidence \rhere the tabulations were made from evidence already properly in the case. U. S. v. GlYf.yson, 166 F. 2d 8G3; I-Jarpe,' v. U. , 1944, 143 F. 2d 783; . S. Y. Feinberg, 10J'J , HO F. 2c1 502. In some rase,s tabulations or audits have been admitted, el'8n though the records or data, on \1" bieh the exhibits were based "\were not fonna,l1y in evidence but 'were HTailable for examination. l\lorthern Puc-ifi' Ra?7uxry Company v. Keyes 1898 , 91 Fed. 47 and Rutler v. U. S. 1D51 5;) F. 2d 80U.

Another type of case has to do with surveys based 'on consumer opinion. As example is U. S. Y. 88 00.8e8: illOi'e OJ' Less: C'containing Bireleq s (change Bevemge 10,,1, 1S7 F. 2d 067, which was a libel proceediJ1g under the Food, Drug and Cosmetic Act. 'I' here, the court , Opinion ;:1 F. admitted surveys covering answers given by 3 539 individuals to questions prepared by the government. These questions concerned con elusions dra.wn by the individuals (based on certain advertising) as to the cont.ents of the product in question. Other cases c01l1Tlenting on the admissibility and value of t.his type of evidence are B'i'i8tol- ilf yen C07npany v. F. T. C. 1950 , 185 F. 2cl 58; G'ldf Oil Om' po1' ation v. F. T. 1945 , 150 F. 2-d 106; Rhodes Phannacal Uompcny v. F. T. C., 1953 2G8 F. 2.d 382. In the latter case t.he conrt aid " Obviously, thQ value of a survey depends upon the mallner in which it is conducted whether the techniques used v.ere lantec1 or fair, " In none of the eases does it n.ppc,-,r that the individuals "\h038 opinions -were collected \ pre available for cross-examination.

Some of the lrngnage in EZgin 1Vo.t/0'la7 lVatc7r Company v. EZgin Cleek C01n7)(tny 1028, 26 F. 2d ;-)76, seems to indicate a view contrary to that expressed in the above rases. There, a petition \Vas filed for an injunction restraining defendant from using ' Elgin" in connection with its products. PlaintiiI, relying on equity rule 48, ttsked permission to file an affidavit of Arthur Lynn, based on ans\\'ers to questionnaires ma,filed to many retail jewelers. Questionnaires asked not only for the opinions or the individual jC\yelers as to the impressions made by the. \vord ' Elgin': but also asked what the opinions of the jewelers customers were. The CGlErS c011clusion seems to have been based largely all its opinion of the purpose and meaning of equity rule 48. In a.addition to the public opinion or consumer surveys, the courts have also admitted in evidence tabulations of factual data, which data was gathered by numerous persons not available for cross-examination. In U, S. v. Alwninwn COTnpany of A1I,erica 1940, 85 F. Supp. 820 , one of the issue, concerned bauxite deposits in Arkansas. Exhibit 16S l ,vas a tabula60n made by a. ,vitness of facts shown by the ruJec1 againstrecords of the drill1ngs of GO!) test holes, The court the governmenfs claim that the individual and numerous drillers should be called to testify as to what each had learned in his separate drilling operations. The court overruled the objections that the offered exhibit was hearsay. The dril1illgs hacl not been clone for the purposes or the Jaw suit. It also appeared that it had been the general custom to accept srich test hole reports as c.correct without calling the 11lakers to verify them. P01chatan ilh'ning Company et al lcke8 1941 , 118 F. 2cl 103 , involved an application La the Bituminous Coal Division of the Department of Interior lor changes in minimum coal prices. The Director of the Division admitted in evidence 23 pages of tabulations based upon invoices filed \with the Division under Section 4, II(a) of the Bituminous Coal Act, purporting to show the , , , , CROWN ZELLERBACH CORP. 1109 1105 Opinion prices of coal of similar quality sold to one of the largest consumers in the district. Section 4, U(a) provided "All code members shan report all spot orders to such stati3tical bureau hereinafter provided Tor as may be designated by the Commission and shall file with ,', " * copies of all invoices, . All such records shall be held by the statistical bureau as the confidential records of the code member filing' such information. " The court held th8,t the tabulations were admissible under the liberal rules applicable to administrative hearings and that the exhibit was not hearsay.

A?Jwrican E'mploycl's l1/sui' ance C01!LJHtJ. v. RouncZ,up Coal J.l1ining Company: 1934, 73 F. 2c1 ;,:i92, \"fls :11 action to recover on fl. fidelity bond because of fraud anti embczzlen1cm( of an clnployee, Bunker. One claim was that Bunker embezzled melley received from the company s customers and failed to credit such payment on the books. Exhibit G5 1 ils mac1 np by d.ii' (:r frm 1 rel)11e~ to lett8:!:s to various customers, in "which replies \Tas set out ,,,hat purporteel to be the true status of the individual accounts. The exhibit was held to be "not only hearsay, but. also made up of a series of self-serving clec1arfltions. Thus, it appears that the showing of the circmnstantial probability of trustworthiness 'was unsatisfactory nor was there adequate showing of the necessity for ihe evidence. In fact, it fllJpears that the evidence, even if admitt.ed, \yould have had no direct bearing on the real question at issue.

Concerning the second principle, that is, the necessity for the evi dence, "'Vigmore points out that necessity.y, in one form or another is found in all the hearsa.y exceptions. \Vigmore on Evidence, V 01- Ume V. Section 1630. In applying this principle Wigmore recommends a reasonable and practical a.approach as is shown by the following statement from U. 8. v. AZumin'll'i Company of Anw'Iica, 35 Fed. Supp. 820 at 82,):

In effed, \Vigmore, snys that, as the word necessity.y is liere used it is not to be interpreted as uniformly demanding a sho\\ ing of total inaccessibility of firsthand evidence as a condition precedent to the acceptance of 11 particular piece of hearsay, but that necessity exists where otherwise great practical inconvenience .would be experienc.ed in making the desired proof ("Wigmore, :Jrd Ed., Vol. V. sec. 1-21; Vol VI, sec. 1702). 1\5 will be seen by scrutinizing the eases cited above as being in accord with or supporting the :\Iel'riam case, it. is inconeeivable that. what the courts whose decisions control in this court have said can properly be construed as requirjng that physical ina.bility be shown in order to establish the type of necessity which const.itutes one of the conditions precedent for using hearsay. If it were otherwise, the result would be that the exception created to the 1110 FEDERAL 'TRADE CO DnSSIO DECISIOXS Opinion 51 F. T. C.

hearsay rule would thereby be mostly, if not completely, destroyed" This matter of necessity for the evidence has been emphasized particularly in antitrust cases, where the inquiry often takes a wide range. In commenting on this fact, the court in U. S. v. nne8()ta Jlirdng and Manufac/wing Company, 1950 , 92 Fed. Supp. fi47 said at page 948:

Helevant political and eeollomlc facts can be preselltecllo the court in un informal way. It is not necessary to comply with those minimal .standards of evidentiary competence suitable for the proof of other types of facts, even in the comparatively loose procedure commonly foJ1owec1 in an anti-trust case wl1Ere the government seeks an injunction. Cf. V. S. v. V. 8. M(/('ki'lflY Corpo"(llio?J D. C. 8D F"d. Supp. 340. It is suffcient that the economic. a.nd political facts ('0)11( from priblishecl sources recognized as anthol'itatiye, pcrsnaf;iyc or reliable by the profession of economists and political scielltists and jf the publications are presented at. R time and in a manner which give the, adverse party adequate opportunity to examine, to challenge, to rebut and to argue upon them.

See a.lso Cub FOTk Coal Company (;!rf88 C01lp(my 1027 19 F. 2d 273.

In appl ving these h\o tests of :ldmi sibility in the. inf'tant elle' , consideration must be given to the statl1te !UHler Iyhirh the. data \ya collected nnd tabulated. Section (i of t11:: Fedenll Tr; de Comlli sion \.ct provides:

That the commission shall abo han' po"wer- (a) To gather and compile information concerning, and to illYE'stigate froni time to time the organiza.tioll\ bllsiness conduct, practices and lnanagcmcnt of any corporation engaged in commerce, excepting' hanks and common can'lers subject to the Act to regula.te commerce and its relation to other' corporations flnd to jncliviclnals, associations and partnerships.

(b) To require by genenll or special 01'1e.18: corporations engaged in commerce., excepting banks, nnd common carrier subjec.t to the Act to regulate conimerce or any class of them, or any of them, 1'e- Epectively, to file with the commission in such form as the commission nwy prescribe annual 01' specin 1, 01' both nnnunl and specjal, reports or answers in writing to specific questions, fUl'nisl1ing to the c0l11nission such information as it may require as to the organization, bllsiness condllct practices: managernent, and relation to other corponltions, partnerships, and in(1ivic1ua1s of the respective corporations fiJing such reports or anSlycrs in writing. Such reports and anSYfers shall be made nnc12l' oath, 01' otherwjse lis the commission CROWN ZELLERBACH CORP. 1111 1105 Opinion mll,y prescribe! and shall oe filed \with the commission within such lpa.'onable period as the commission may prcsc.ribe, unless additional time be granted in any case by the commission, , (f) To make public from time to time such portions or the jn- :formation obtained by it hereunder. except trade secrets and names of cust.omers. as it shall deem expedient in the public interest; and (() make Hnnual and special reports to t.he Congress und to sublnit tbermvith l'ecommcndatiollS for aclcliLional1egislaLioll; and to provide f()r the publication of its reports and decisions in such form and manlier as may be best adaptecl Jar public illformation and use, Section J I) of the Act provides:

Any person "who shali 'willfully make 01' cause to be made, any Lllsp entry OJ' sraternent of fact in any report required to be made l111dcl' this -\l't * * * slwJl be deemed guilty of an o1-1'ense against rhe l united States, and shall be subject upon conviction in ally conrt of the Lnited States of competent jnri.sdiction, to a. fine of not less than $1 000 1101' more than $5 000 or to imprisonment for a term of l:ot more than three years. or to both such fine and imprisonment. As against the required trustworthiness and necessity, respondent urges, among other things: that the surveys were conducted by mail; t.hat they were made after complaint was issued and for purposes of this litigation; that Dr. Barnes, while a trained economist, is not an expert in the paper business; that the classification of products was not correct; that the method or selecting customers (particularly those or respondent and St. Helens Pulp & Paper Co. was unfair and would result in biased ans-wers; that the persons supplying the evidence are not a,.ailable for cross examination.

These are an matters which may be inquired into and evaluated at the proper time. They have to do with the weight or the evidence rather than its admissibility. Dr. Barnes' testimony, already in the record, set.s out the steps taken to insure the accuracy of the data sought under Section G or the Federal Trade Commission Act. One or the developments of onr complex economic life is the increase in the use of information of this character, both by government and business. The personal property Lax system of mfln:y States relies on data collected by offcials and certified by the individual taxpayer to be correct. Tabulations of this dahl so collected are later used by boards in equalizing taxes between governmental subdivisions. The use of information collected by the Census Bureau is another example. Surveys made by independent organizations on a variety of subjects are used and relied upon in the field of business. Such a survey was considered admissible Opinion 51F.

and as having probative value in the matter of Pilsbury Mills, Inc. Docket No. 6000.

It is our conclusion that Commission s Exhibit 62 is not subject to the objection that it is hearsay.

The second question (and the one immediately before us) has to do with the limitation placed by the Commission on the use of the elate upon which Exhibit 62 was based.

l\fany of the cases already cited have also considered this question. In Powhatan 31ini11U C01npu.ny. et al. ekes, the Director did not allow an inspection of the invoices on which the tabulations were based because he considered them confidential. The court pointed out that the information secured under Section 4, II (a) was not confidential in this type of proceeding, and that the disclosure should have been made, in the ilJtcrp ,t of a fair hcarin(Y. Von'.hei''i, Puc/Ic Hal1llay Company v. !(eys 91 Feel 47, was a suit involving the fixing of railway rates by a State board of railway commissioners. large numbe.r of tables \were prepared in the accounting departments of several railroads affected showing the amount of business done for a certain period. The \lork vas done by 40 or i:i clerks under the direction of the heads of the departments who \\ ere called as 'witnesses. The court held that it \las not necessary to call the clerks to testify as to the correctness of the tables as each clerk ma.de but a part of them, but it l,YllS su:wcient if the l' ecorc1s from hjch the computations Were made \\81'e placed at the disposal of the opposing patty 1'or examination. A1tqustille Bowles 1945 ) 1. , F. 2d 93 as an action by the Aciministrator of the OP A, 101' treble damages for violation of the Emergency Price Control Act. Exhibit 11 was a compilation s11o\':ing. overcharges made by Augustine in the sale of meats to \\ wholesale grocers. An OP A investigator, Ortland, obtained the original invoices of sales from Augustine, had another investigator prepa.re the tabulation listing customers sales, prices, etc. O.!:tlanc1, alone, \Tas called and testified he only ' spot checked" a certain number o:r invoices. All the invoices hO\\8\"e1' , were made available at the trial for examination by Augnstine p,nrl the tabulation \las held admissible. The. general pr:rport. 01' UWfie decisions is that eross-examinr!.tion is a valuable riQ'ht arid should pot be restricted b2yol1d the actual necessi ties 01 a. pa 'tic1llal' c:!se. "IVe believe that the c;rc1er of the Commission of .January 18 , ID5;), Y?s l11nt:cessal'ily rcstrlct1yc, It. is ordered that the said order be withdrawn and the iol1o\'ing is adopted in lieu thereof:

: \\ CROW'. ZELLERBACH CORP. 1113 1105 Order For the purposes of this litigation the basic information collected by t.he Bure lU of Economics pursuant to Commission resolution 1fay 6, 1954, and the work papers used in compiling the Survey of 1Vestern Converters and Jobbers of Certain Coarse Paper and Paper Products sha,ll be made available to respondent and its counsel, at such reasonable times and phwcs as may be determined by the hearing examiner. 110 information secured on FTC forms EE-l or EE-2 that can be identified with reporting companies shall be admitted into the public record for any purpose.

The case is remanded to the flearing Exalniner for further proceedillg in accordance with this opinion.

ORDER RULING OX IXTERLOC"L'TORY \APPEAL Counsel sllpporting the complaint having filed an interlocutory ap peal :I: 01:1 the, hearing exa:niner s order of February 14, 11)53 , sustaining the respondent's objections to the receipt into evidence of Commission s Exhibit 62 for ic1entificabon; and The COlnmission having heard the appe,al on briefs and o1'r..1 argn- Hleni-s: and having rendered its decision recognizing that he restrictions upon the, nse of the basic information an (1 "cork papers used in compiiing; the exhibit) imposed by the C01TllTission s order of J annary : HJD;J e1'C lUldu1y c1estl'ictiY8j and directing that said basic informat.ioll find IYOTk: pllpers be lJflcLe aYfljbble to the respondent and its c.OUlJS,eJ under the te l1s flllc) conditions set forth in said decision, and having' remanded the case t.o the heflring c:Si:,mine.l fol' further pro (''ecbl;;' s in accordance 'iyith the c ec:ision: It i8 oici'eFra\ Thflt the :appeal 01' cOlln E: nppnrting the, COJT1l)lain.t be and it hrreb T is: othenrisc rleniec1.

,, 1114 FEDERAI-i TRADE COM::nSSION DECISIONS Decision :11 F. T. C.