Stanley Electronics Corporation

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IN THE MATTER OF STANLEY ELECTRONICS CORPORATION ET AL.

CONSENT ORDER. ETC., IN REGARD TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSION ACT Docket 7078. Cum plaint, Mct1". 3, 1958-Decision, Sept. , 1958 Consent order requiring sellers in Paterson, N. , of radio and television tubes principally to consumers, including repairmen, to cease referring falsely to their products in advertising brochures and advertisements in magazines, etc. , as "Brand new pre-testeci tubes" when many of such tubes were usecI, pull-out, manufacturers' surplus, military surplus, and factory reject; and to cease selling such inferior products without disclosing their true nature on the tube, box, carton, invoices, or in advertising. MT. Kent P. J(1' atz for the Commission. BTen1nan and Susser by 11:11' He?' be?' t Susser of Paterson, N. for respondents.

INITIAL DECISION BY J. EARL Cox, HEARING EXAMINER The complaint charges respondents with falsely and deceptively representing that the television and radio tubes which they sell and distribute in commerce are nevv, unused and of first quality, and \\with failure to disclose the true nature of their tubes, in violation of the provisions of the Federal Trade Commission Act. After the issuance of the complaint, respondents, their counsel, and counsel supporting the complaint entered into an agreement containing consent order to cease and desist, which was approved by the Director and an Assistant Director of the Commission Bureau of Litigation, and thereafter transmitted to the hearing examiner for consideration.

The agreement identifies Respondent Stanley Electronics Corporation as anew Jersey corporation, with its office and principal place of business located at 840 IVlain Street, Paterson, N. , and individual respondents Stanley Bro,vn and Philip L. Bornstein as president and secretary, respectively, of the respondent corporation, whose affairs, activities and policies of business they control, their address being the same as that of said corporate respondent. The agreement provides, among other things, that respondents admit all the jurisdictional facts alleged in the complaint, and agree that the record may be taken as if findings of jurisdictional facts had been duly made in accordance with such allegations; Order 55 F.

that the record on which the initial decision and the decision of the Commission shall be based shall consist solely of the complaint and this agreement; that the agreement shall not become a part of the official record unless and until it becomes a part of the decision of the Commission; that the complaint may be used in construing the terms of the order agreed upon, \which may altered, modified or set aside in the manner provided for other orders; that the agreement is for settlement purposes only and does not constitute an admission by the respondents that they have violated the law as alleged in the con1plaint; and that the order set forth in the agreement and hereinafter included in this decision shall have the same force and effect as if entered after a full hearing.

Respondents waive any further procedural steps before the Hearing Examiner and the Commission, the making of findings of fact or conclusions of lavv, and all of the rights they may have to challenge or contest the validity of the order to cease and desist entered in accordance with the agreement. The order agreed upon fully disposes of all the issues raised in the complaint, and adequately prohibits the acts and practices charged therein as being in violation of the Federal Trade Commission Act. Accordingly, the Hearing Examiner finds this proceeding to be in the public interest, and accepts the agreement containing consent order to cease and desist as part of the record upon which this decision is based. Therefore It is ordered That respondents Stanley Electronics Corporation, a corporation, and its officers, and Stanley Brown and Philip L. Bornstein, individually and as officers of Stanley Electronics Corporation, respondents' representatives, agents and employees directly or through any corporate or other device, in connection with the offering for sale, sale, or distribution of television or radio tubes in commerce, as "commerce" is defined in the Federal Trade Commission Act, do forthwith cease and desist from: 1. Representing directly or by implication that used, pull-out, factory rejects, military surplus, or manufacturers' surplus tubes are new or of first quality;

2. Selling, offering for sale, or distributing used, pull-out, factory rejects, military surplus or manufacturers' surplus radio or television tubes without clearly disclosing on the tube or the individual carton in which each tube is packaged when sold this way and in advertising, invoices, and shipping memoranda that STANLEY ELECTRONICS CORPORATION ET AL. 305 303 Decision they are used, pull-out, factory rejects, military surplus or manufacturers' surplus tubes, as the case may be; radio or tele- 3. Selling, offering for sale, or distributing any vision tube which is not new or first quality without clearly and conspicuously disclosing that fact on the tube, or the individual carton in which each tube is packaged when sold this way, and in advertising, invoices and shipping memoranda. 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 11th day of September 1958, become the decision of the Commission; and, accordingly:

It is ordered That respondents Stanley Electronics Corporation, a corporation, and Stanley Brown and Philip L. Bornstein individually and as officers of said corporation, 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.

Complaint 55 F.