Psychological Corporation

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IN THE MATTER OF PSYCHOLOGICAL CORPORATION, ET AL.

CONSENT ORDER, ETC., IN REGARD TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSION ACT Docket 6967. Co?n1Jla.int. , Nov. 29, 1957-Dec.ision, Nov. , 1958 Consent order requiring the nation s four largest publishers of vocational aptitude, and psychological tests and related material-constituting the only source of supply for much of said products-to cease refusing concertedly to sell to concerns conducting tests by mail, maintaining lists of such firms and persons, and exchanging such lists and information concerningprospective customers to whom they would not sell. Mr. Floyd O. Collins and Mr. L. E. Creel, J?\ for the Commission.

by Mr. Howard A. Paul, Reiss, Rifkind, Wha.rton Ga'lTison. TO1Jkis and Mr. Sal1uwl J. Silvennan of NewSeitz, Mr. Jay H. York, N. , for Psychological Corporation and Science Research Associates;

B'I'eed, Abbott Morgan by Mr. Kendall B. DeBevoise and Mr. John J. Ca'lnpbeU of New York, N. , for World Book Co. Respondent California Test Bureau, for itself. INITIAL DECISION BY ABNER E. LIPSCOMB, HEARING EXAMINER On November 27, .1957, the Federal Trade Commission issued its complaint in this proceeding, charging respondents with violating the provisions of ~5 of the Federal Trade Commission Act by entering into and thereafter carrying out understandings agreements and a planned common course of action to restrict and restrain competition and interstate trade and commerce in the sale and distribution of vocational, aptitude and psychological tests and materials to be used in conducting tests. On September 11, 1958, respondents, their counsel, and counsel supporting the complaint herein entered into an Agreement Containing Consent Order to Cease and Desist, which was signed on the original copy by all respondents except California Test Bureau, and by that respondent on an identical carbon copy; both signed copies of the agreement were then approved by the director and an assistant director of the Commission s Bureau of Litigation, and thereafter the agreement was submitted to the hearing examiner for consideration.

PSYCHOLOGICAL CORPORATION, ET AL. 753 752 Order The agreement identifies respondent Psychological Corporation as a New York corporation with its home office located at 522 Fifth Avenue New York, N. ; respondent Science Research Associates as an Illinois corporation with its home office and principal place of business located at 57 W. Grand A venue, Chicago, Ill. ; respondent World Book Company as a Delaware corporation with its home office and principal place of business located at Yonkers-on-Hudson, N. ; and respondent California Test Bureau as a California corporation with its home office and principal place of business located at 5916 Hollywood Boulevard, Los Angeles, Calif.

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.

Respondents waive any further procedure before the hearing examiner and the Commission; the making of findings of fact and conclusions of law; 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. All parties agree that the record on which the initial decision and the decision of the Commission shall be based shall consist solely of the complaint and the agreement; that the order to cease and desist, as contained in the agreement, when it shall have become a part of the decision of the Commission, shall have the same force and effect as if entered after a full hearing, and may be altered, modified or set aside in the manner provided for other orders; that the complaint herein may be used in construing the terms of said order; and 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 complaint. After consideration of the allegations of the complaint and the provisions of the agreement and the proposed order, the hearing examiner is of the opinion that such order constitutes a satisfactory disposition of this proceeding. Accordingly, in consonance with the terms of the aforesaid agreement, the hearing examiner accepts the Agreement Containing Consent Order to Cease and Desist; finds that the Commission has jurisdiction over the respondents and over their acts and practices as alleged in the complaint; and finds that this proceeding is in the public interest. Therefore It is ordered That the respondents, Psychological Corporation Decision 55 F.

a corporation, Science Research Associates, a corporation, World Book Company, a corporation, and the California Test Bureau a corporation, and said respondents' officers, agents, representatives and employees, in or in connection with the composing and publishing, offering for sale, sale or distribution in commerce, as commerce" is defined in the Federal Trade Commission Act, of vocational, aptitude, psychological and similar tests and material to be used in conducting tests, do forthwith cease and desist from entering into, continuing, cooperating in, or carrying out any planned common course of action, understanding, combination or agreement, between any two or more of said respondents or between or among anyone or more of said respondents and others not parties hereto to do or perform any of the following acts or practices:

(a) Refusing to sell their said tests and material to be used in conducting tests to any purchaser or prospective purchaser; (b) Preparing or maintaining any lists of purchasers or prospective purchasers to whom they will not sell; (c) Exchanging information as to the names of purchasers or prospective purchasers to whom they will not sell. 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 or the hearing examiner shall, on the 19th day of November 1958, become the decision of the Commission; and, accordingly:

It is ordel'ed That respondents Psychological Corporation, a corporation; Science Research Association, a corporation; Worlel Book Company, a corporation; and California Test Bureau, a 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. G. P. HALFERTY & CO., ET AL. 755 Complaint