Topps Chewing Gum, Inc.

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IN THE 1\iA TTER OF' TOPPS CHE1VING Gill1, INC.

CONSENT ORDER, ETC., IN REGARD TO THE ALLEGED VIOLATION OF SECS. 2 (a) AND 2 (d) OF THE CLAYTON ACT Docket 6747. Co-mpla.'int, 1110,1- 26, 1957-Dedsion., Oct. , 1957 Consent order requiring a Brooklyn, N.Y., manufacturer of bubble gum and. Clor-Aid" chicIet type of gum containing chlorophyll, to cease discriminating in price in violation of Secs. 2(a) and 2(d) of the Clayton Act by such practices as (a) selling its "Bazooka" brand bubble gum and picture card bubble gum to some jobbers at a 5% discount from the prices charged others; and (b) paying a chain of food stores $2 200 as compensation for advertising, etc. , in connection with its products, while not making comparable others to the chain s retail competitors. COMPLAINT The Federal Trade Commission, having reason to believe that Topps Chewing Gum, Inc., is violating and has violated the provisions of subsections (a) and (d) of Section 2 of the Clayton Act as amended by the R.obinson-Patman Act, approved June 19 , 1936 (D. C. Title 15, Section 13), hereby issues its complaint, stating its charges with respect thereto as follows:

COUNT I Charging violation of subsection (a) of Section 2 of the Clayton Act, as amended, the Commission alleges:

P AnAGIU.PH 1. Respondent, Topps Chewing Gum, Inc., hereinafter referred to as respondent, is a corporation organized, existing, and doing business under and by virtue of the laws of the State of New Yor1\:, with its principal office and place of business located at 254 36th Street, Brooklyn, New York.

PAn. 2. Respondent is now, and since 1947 has been, engaged in the manufacture and sale of chewing gum products, including gum commonly referred to as "bubble gum " and a chiclet type of gum containing c.hlorophyll sold under the trade name "Clor-Aid. Respondent sens said chewing gum products to different purchasers including jobbers and retailers, located in the various states of the United States and the District of Columbia. PAn. 3. In the c.course and conduct of its business respondent has engaged in commerce, as "commerce" is defined in the Cla.yton Act as amended in that Hesponclent ships its products, or causes thelr 528577 60- Complaint 54 F.

to be shipped, from its place of business to said purchasers so located in States other than the State of origin of such shipments. PAR. 4. In the course and conduct of its said business in commerce respondent is now and has been in competition with other corporations, partnerships, individuals, and firms engaged in manufacturing, selling, and distributing chewing gum products. PAR. 5. In the course and conduct of its business as above described, respondent has sold and now sells chewing gum products some purchasers at substantially higher prices than the prices charged competing purchasers for such products of like grade and quality.

For example, respondent sells "Bazooka" brand bubble gum and picture card bubble gum to some jobbers for 70i and 72~ per 120 count box, respectively. Respondent sens said products to other competing jobbers at said prices less a discount of 5%. PAR. 6. The effect of such discriminations in price made by respondent, as set forth in Paragraph Five hereof, may be substantially to lessen competition or tend to create a monopoly in the lines of commerce in which respondent and its purchasers are respectively engaged; or to injure, destroy, or prevent competition with respondent and with purchasers of respondent who receive the benefit of such discriminations.

PAR. 7. The acts and practices of the respondent as aneged above violate subsection (a) of Section 2 of the Clayton Act, as amended. COUNT II Charging violation of subsection (d)' of Section 2 of the Clayton Act, as amende. , the Commission alleges: PAR. 8. Paragraphs 1 and 2 of Count 1 hereof are hereby repeated and made a part of this count as fully and with the same force and eflect as though here again set forth in full. PML 9. In the course and conduct of its business respondent has engaged in commerce as "commerce" is defined in the Clayton Act as amended in that respondent ships its products, or causes said products to be shipped, from its place of business to said purchasers so located, some of whom are in competition ",ith each other in the sale and distribution of said products.

PAR. 10. In the course and conduct of its business in commerce as herein described, respondent paid, or contracted to pay, something of value to or for the benefit of some of its customers as compensa- TOPPS CHEWING GUM, INC. 477 475 Decision tion or in consideration for services and facilities furnished Or contracted to be furnished, by or through such customers, in connection with their offering for sale or sale of products sold to them by said respondent, and such payments were not made available on proportionally equal terms by respondent to all customers competing in the sale and distribution of its products.

During the past several years, and continuing to the present time respondent has made such payments to many of its retailer customers in consideration of their advertising and otherwise promoting the resale of its chewing gum products.

For example, during the year 1953, respondent contracted to pay and did pay to Food Fair Stores, Inc. of Philadelphia, Pennsylvania, $2 200 as compensation or as allowances for advertising or other service or facility furnished by or through Food Fair Stores Inc., in connection with its offering for sale or sale of products sold to it by respondent. Said payments were not oflered or otherwise made available by respondent on proportionally equal terms to all other retailer customers competing in the sale and distribution of respondent's products with said favored customers. PAR. 11. The acts and practices of the respondent, as alleged above violate subsection (d) of Section 2 of the Clayton Act, as amended. Jf1.. F?'edTic T. Su,ss for the Commission. Rosenllwn., Gol(bnark, Colin llaye of New York, N. , by J111.. S-eynW1./;1' D. Lewi.s for respondent. IXITL\L DECISION BY ,VILLHl\! L. PACK HEARING EXXl\IINER The complaint in this matter charges the respondent with violation of Section 2 of the Clayton Act, as amended by the Robinson- Patman Act, in connection with the sale of chewing gum products. An agreement has now been entered into by counsel supporting the complaint and respondent ,which provides, among other things, that respondent admits all of the jurisdictional allegations in the complaint; that the record on which the initial decision and the decision consist solely of the com-of the Commission shall be based shall plaint and agreement; that the inclusion of findings of fact and conclusions of law in the decision disposing of this matter is "waived together with any further procedural steps before the hearing exami- 11e1' and the Commission: that the order hereinafter set forth mav be. entered in disposition of the proceeding, such order to have the Order 54 F.

same force and effect as if entered after a full hearing, respondent specifically waiving any and all rights to challenge or contest the validity of such order; that the order may be altered, modified, or set aside in the manner provided for other orders of the Commission; that the complaint may be used in construing the terms of the. order; and that the agreement is for settlement purposes only and does not constitute an admission by respondent that it has violated the law as alleged in the complaint.

The hearing examiner having considered the agreement and proposed order and being of the opinion that they provide an adequate: basis for an appropriate disposition of the proceeding, the agreement is hereby accepted, the following jurisdictional findings made and the following order issued:

1. Respondent, Topps Chewing Gum, Inc., is a corporation, existing and doing business under and by virtue of the laws of the State of New York with its principal office and place of business located at 254 - 36th Street, Brooklyn, New York. 2. The Federal Trade Commission has jurisdiction of the subject matter of this proceeding and of the respondent. ORDER I t is ordered That respondent, Topps Chewing Gum, Inc., a corporation, and its officers, representatives, agents, and employees directly or through any corporate or other device, in, or in connection with the sale of chewing gum products in commerce, as "commerce" is defined in the Clayton Act, as amended, do forthwith cease and desist from:

1. Discriminating, directly or indirectly, in the price of said chewing gum products of like grade and quality, by selling to any purchaser at net prices higher than the net prices charged any other purchaser, which purchasers, in fact, compete in the resale or distribution of such products.

2. :Making or contracting to make to or for the benefit of any customer, any payment or allowance of anything of value as compensation or in consideration for any advertising or other services or facilities furnished by or through such customer, in connection with the handling, offering for resale, or resale of products sold to him by respondent, unless such payment or allowance is affirmatively offered or otherwise made available on proportionally equal terms resaleto aU other customers competing in the distribution or such products.

TOPPS CHEWING GUM, INC. 479 475 Decision DECISION OF THE COMMISSION AND ,ORDER TO FILE REPORT OF COMPLIANCE Pursuant to Section 3.21 of the Commission s Rules of Practice, the initial decision of the hearing examiner shall, on the 26th day of October, 1957, become the decision of the Commission; and, accordingly ;

1 t is ordered That respondent herein shan, within sixty (60) days after service upon it of this order, file with the Commission a report in writing setting forth in detail the manner and form in which it has complied with the order to cease and desist. Complaint 54 F.