Benjamin Glickman and Isaac Glickman trading as Glickman Bros.

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Ix tur Marrer or BENJAMIN GLICKMAN AND ISAAC GLICKMAN TRADING AS GLICKMAN BROS.

ORDER, ETC., ‘IN REGARD TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSION AND THE FUR PRODUCTS LABELING ACTS Docket 6713. Complaint, Jan. 22, 1957—Decision, Dec. 27, 1957 Order requiring a manufacturing furrier in New York City to cease misbranding and false invoicing of fur products and to comply generally with requirements of the Fur Products Labeling Act. Mr. Ross D. Young, Jr. and Mr. Robert LE. Vaughan for the Comniission.

Mr. Maw Zucker, of New York, N.Y., for respondents. Ixirta, Decision py Jonnw B. Pownpesrer, Hearne LxaMiner PRELIMINARY STATEMENT Benjamin Glickman and Isaac Glickman, individually and as copartners trading as Glickman Bros., hereinafter referred to as respondents, are charged with misbranding and issuing false and deceptive invoices in connection with the sale of fur products. The complaint. charges that respondents misbranded their fur products by failing to show on the Jabels attached to each fur product. which they manufacture (1) the country of origin and (2), the item nunber thereof. ‘The complaint further alleges that respondents falsely and deceptively invoiced their fur products by failing to show on their sales invoices (1) the country of origin of the fur and (2), the item number thereof.

Respondents filed an answer to the complaint admitting that they manufactured, sold, and distributed fur products in “commerce,” admitted the allegations as to misbranding, but denied the allegations as to false and deceptive invoicing on the ground that they had no intent to deceive. Thereafter, counsel for respondents and counsel supporting the complaint negotiated for a consent: agreement. Respondents were willing to execute an agreement to cease and desist misbranding their fur products, as alleged in the complaint, by failing to show on each fur product the (1) country of orgin and (2), the item number thereof, but refused to agree to a consent cease and desist. order covering and including each and all of the mandatory requirements of section 4(2) (A) through (F) and section 5(b) (1) (A) through (F) of the Fur Products Labeling Act. Respondents con- GLICKMAN BROTHERS 897 896 Findings tend that, since the complaint. charges that respondents were deficient in only two of the six labeling and invoicing requirements of sections 4(2) and 5(b) (1) of the act, therefore, the cease and desist order to be entered herein should only require cessation of the labeling and invoicing deficiencies found and should not. contain and include provisions making it mandatory for respondents to likewise observe the other affirmative requirements of sections 4(2) and 5(b) (1) of the act. Respondents contend that, in the event they should agree to such a broad order as proposed by counsel supporting the complaint, persons in the fur industry who might. read such an order would infer and conclude that. respondents had violated each and all of the mandatory requirements of section 4(2) and section 4(b) (1) of the act, which would reflect on respondents’ integrity and damage them financially in the operation of their business. Rather than accept such a broad order, respondents requested a hearing in the behef that the order to be issued as a result of the evidence introduced ata hearing would, under the Jaa, including the Administrative Procedure Act, only contain those mandatory requirements of said sections of the act which respondents might be found deficient and which respondents admitted.

Hearings were held in New York, N.Y., on March 25 and April 25, 1957, for the presentation of evidence in support of the complaint. Respondents rested at the close of the testimony in support of the complaint and did not. present any direct.testimony. There is actually no disagreement as to the facts. Proposed findings, conclusions, and order have been submitted by counsel supporting the complaint and counsel for respondents. The examiner has considered the evidence and testimony introduced at the hearing and the proposed findings of fact, conclusions, and order submitted by counsel. AJ] proposed findings and conclusions not specifically found or concluded m this decision are rejected. Upon the basis of the entire record the examiner makes the following findings of fact, conclusions, and issues the following order:

Fixpines or Facr The respondents Benjamin Glickman and Isaac Glickman are. copartners trading as Glickman Bros., with their office and principal place of business Jocated at 146 W. 20th Street, New York, N.Y. Since the effective date of the Fur Products Labeling Act, August. 9, 1952, and for approximately 25 years prior thereto, respondents have been engaged in the manufacture, sale, and distribution in “commerce” Findings 54 F.T.C of small fur garments, such as stoles, capes, and furs to retail and department stores. Respondents manufacture and sell mink garments exclusively. Approximately 80 percent of the mink skins purchased by respondents for manufacture are raw skins which are delivered direct from the dealer to the dresser for processing preparatory to manutacture by respondents into fur garments. About 70 percent of the mink skins purchased by respondents originate in the United States and the remaining 30 percent originate in five or six foreign countries, including Norway, Denmark, Sweden, and Scandinavian countries. The raw skins purchased by respondents do not bear individual tags showing the country of origin of each skin. The only reference to the origin of the individual raw skin is contained on the invoice delivered by the dealer to respondents at the tune of purchase. Occasionally respondents purchase more than one batch of raw mink kins from a dealer which may have originated in more than one foreign country. In such a situation, when the raw skins are sent to the processor, skins which have originated in more than one foreign country may be placed in one vat during processing, thus making it impossible to thereafter identify the country of origin of each particwlar skin. Although the evidence shows that a tag or label was attached to each individual mink garment manufactured, sold, and -distributed in “commerce”™ by respondents which contained the word “Mink? and the country of origin thereof, nevertheless, since raw furs from several foreign countries may have been intermingled during processing in some instances, it follows that, in such instances, the designation on the label as to country of origin may not have been an accurate representation. This was one of the tavo types of violations alleged in the complaint. with respect to misbranding. Respondents admitted this allegation. The other related to the failure of respondents to list the item number? on the tag or label attached to each individual fur garment manufactured by respondents. Respondents also admitted this allegation and it is found that, prior to September 1956, the tag or label on fur procucts manufactured, sold, and distributed by respondents did not. show the item number thereof. However, since Sepember 1956, respondents have been maintaining a ‘record of the item number on each fur product which they manufacture and such item number is shown on the tag or Jabe]l which is attached to each individual fur garment.

The other type of violation alleged in the complaint. concerns respondents’ practices with respect to invoicing. Respondents do not 1By maintaining an item number for each individual fur garment, a line of continuity :from the source to the finished fur product may be maintained. GLICKMAN BROTHERS 899:

896 Order deny that their invoicing practices did not comply with the requirements of the act in every respect. It is found, with the exception of one invoice dated January 26, 1956, that, for the period beginning January 8, 1956 (invoice No. 866) through September 28, 1956 (invoice No. 1648), the invoices issued by respondents in connection with the sale and delivery in “commerce” of their manufactured fur products did not contain the item number as required by rule 40 (a) of the rules and regulations promulgated under the Fur Products Labeling Act nor the country of origin as required by section 5(b) (1) (F) of the act.

CONCLUSIONS The aforesaid acts and practices of respondents, as found herein, are in violation of the provisions of the Fur Products Labeling Act. and the rules and regulations promulgated thereunder, and constitute unfair and deceptive acts and practices in commerce under the Federal Trade Commission Act.

At. the time of the hearing, the principal question for decision was the form of the cease and desist order to be issued herein. Since that time the Commission has resolved the question by its decision in Mandel Brothers, Inc., docket. No. 6434, issued on July 5, 1957. In that case, as here, the respondent was found to have violated the Fur Products Labeling Act by failing to label and invoice its fur products in accordance with some of the mandatory requirements of sections 4(2) and 5(b) (1) of the act. However, the cease and desist order contained in the initial decision in that case was limited in scope to the mandatory requirements of sections 4(2) and 5(b) (1) which respondent. was found to have failed to observe, and did not include each of the cther mandatory requirements of sections 4(2) and 5(b) (1) of the act. On appeal] from the examiner’s failure to include each of the mandatory provisions of sections 4(2) and 5(b) (1) in the cease and desist. order, the Commission held that, in such a case, the order should include each of the mandatory provisions of sections 4(2) and 5(b) (1) even though respondent. was found deficient. in only some of the labeling and invoicing requirements of sections 4 (2) and 5(b)(1) of the act. Accordingly, the order to be issued herein will follow that decision.

ORDER Jt ts ordered, That respondents, Benjamin Glickman and Isaac: Glickman, individually and as copartners trading as Glickman Bros., or under any other name, and respondents’ representatives, agents: ‘900 FEDERAL TRADE COMMISSION DECISIONS Order 54 F.T.C.

and employees, directly or through any corporate or other device, in connection with the introduction, or manufacture for introduction, into commerce, or the sale or offering for sale in commerce, or the transportation or distribution in commerce, of fur products, or in connection with the manufacture for sale, sale, oftering for sale, ‘transportation, or distribution of fur products which have been made in whole or in part of furs which have been shipped and received in commerce, as “commerce”, “fur” and “fur products” are defined in the Fur Products Labeling Act, do forthwith cease and desist from: A. Misbranding fur products by :

1. Failing to aflix labels to fur products showing : (A) The name or names of the animal or animals that produced the fur, as set forth in the Fur Products Name Guide and as prescribed under the rules and regulations: ; (B) that the fur product contains or is composed of used fur, when such is the fact;

(C) that the fur product. contains or is composed of bleached, dyed or otherwise artificially colored fur. when such is the fact; (D) that the fur product. is composed in whole or in substantial part. of paws, tails, bellies, or waste fur, when such is the fact: (E) the name or other identification issued and registered by the Commission, of one or more persons who manufactured such fur product. for introduction into commerce, introduced it into commerce, sold it in commerce, advertised or offered it. for sale in commerce, or transported or distributed it.in commerce : (F) the name of the country of origin of any imported furs used in the fur product; and (G) the item number of such fur product.as required by rule 40(a) of the regulations under the Fur Products Labeling Act. B. Falsely or deceptively invoicing fur products by : 1. Failing to furnish invoices to purchasers of fur products showing:

(A) The naine or names of the animal or animals that produced the fur as set forth in the Fur Products Name Guide and as prescribed by the rules and regulations:

(3) that the fur product. contains or is composed of used fur, when such is the fact:

(C) that the fur product contains or is composed of bleached, dyed or otherwise artificially colored fur, when such is the fact; (D) that the fur product. is composed in whole or in substantial part of paws, tails, bellies, or waste fur, when such is the fact ; (E) the name and address of the person issuing such invoice; GLICKMAN BROTHERS 901 $96 Opinion (F) the name of the country of origin of any imported furs contained in the fur product; and’ (G) the item number of such fur product as required by rule 40(a) of the regulations under the Fur Products Labeling Act. OPINION OF THE COMMISSION By Secrest, Commissioner :

In his initial decision filed after hearings were concluded, the hearing examiner found that. the respondents had misbranded and falsely invoiced certain of their fur products in respects there designated. Holding that. these acts and practices were in violation of the Fur Products Labeling Act. and of rules and regulations promulgated thereunder, the initial decision’s order to cease and desist. proposes to require that the respondents correct the labeling and invoicing deficiencies there found and directs their adherence in future labeling and invoicing to the requirements prescribed under sections 4(a) (2) and 5(b) (1) of thatact. The appeal filed by the respondents from the initial decision excepts to the scope of the order. The respondents manufacture and sell in commerce to retailers and wholesalers mink stoles and capes and other garments composed of that. fur. The respondents have admitted the juridictional allegations of the complaint and interpose no exceptions to the hearing examiner's finding that. their labeling practices constituted misbranding within the meaning of the Actin that certain of the labels attached to their garments have not. contained statements, as required under section (a) (2) of the act, correctly identifying the country of origin of imported furs contained in their fur products. Furthermore, prior to September 1956, their garment labels contained no item number designating the particular products being sold. Identification by item number on labels and invoices for garments subject. to the Act. is required under rule 40(a) of the rules promulgated by the Commission pursuant to authority delegated to it under the Fur Products Labeling Act. As to respondents’ invoicing practices, the appeal further concedes that the fur products were not duly identified on sales invoices by item numbers and that the invoices issued by the respondents departed from the requirements of section 5(b) (1) of the act. in that they likewise omitted a statement as to the country of origin of imported furs which were components of the garments.

In addition to prescribing that the country of origin of any imported fur skins contained in garments be disclosed on required 902 FEDERAL TRADE. COMMISSION DECISIONS Opinion 54 FTC.

labels and invoices for products covered by the act, sections 4(a) (2) and 5(b)(1) also require that such labels and invoices show the name or names of the animals producing the fur, that they identify, in manners there designated, the manufacturers or sellers of the fur products and that disclosures be made, when such be the fact, that the garments contain used fur, are composed of paws, tails, bellies or waste fur or contain dyed, bleached or otherwise artificially colored fur; and the sections specify that failure to supply such information on labels and invoices likewise constitutes misbranding and false invoicing. The order contained in the initia! decision includes provisions directing that the respondents similarly observe the foregoing companion requirements of those subsections in their future marketing of garments covered by the act. No evidence was received indicating that the respondents had failed in any manner to disclose labeling or invoicing information prescribed under these latter provisions and no violations on those scores were found in the initial decision. The appeal contends that the scope of the order should be limited solely to directing compliance with those requirements of the subsections and rules which the evidence shows the respondents heretofore have failed to observe and that. the proscriptions additionally requiring adherence in labeling and invoicing to the subsections’ companion provisions lack adequate legal basis.

We are of the view, however, that the initial decision’s order has sound basis beth in Jaw and public policy. Under the act, a fur product. subject. thereto is misbranded and its manufacture for sale or its distribution is unlawful unless it has attached to it a label setting forth clearly and conspicuously all the data indicated as necessary to be included thereon by section 4(a)(2); and such parment is falsely invoiced unless there is issued in connection with its sale an invoice containing each of the statements contemplated by section 5(b)(1). It is clear, therefore, that the essence of the respondents’ illegal conduct. consisted of their failure to attach proper labels to their fur products and to issue proper invoices in connection with sales thereof.

In our decision in the matter of Afandel Brothers, Inc., docket No. 6484 (decided July 5, 1957), we rejected, for reasons there stated, contentions similar to those passed here by the respondents. We held in that. case and reaftlirm that ruling here. that orders te be issued in connection with offenses where there has been failure to comply fully with requirements of sections 4(a)(2) or 5(b) (1) should require not only cessation of the practices theretofore engaged GLICKMAN BROTHERS 903 896 Order in but should require that proper Jabels be attached and proper invoices be issued in full compliance with sections 4(a) (2) and 5(b) (1). We therefore deem the hearing examiner's order in this proceeding to be appropriate in scope and accordingly are denying respondents’ appeal and are adopting the initial decision as the decision of the Commission.

FINAL ORDER This matter having been heard by the Commission upon the appeal of the above-named respondents from the initial decision of the hearing examiner and upon the briefs filed in support of and in opposition to the appeal; and The Commission having rendered its decision denying the appeal and adopting the initial decision of the hearing examiner as the decision of the Commission :

It is ordered, That the respondents shall, within 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. Decision i FE. TC.