Eastern Metal Products Corporation, et al.

Text (OCR of the scan at left; may contain errors)

IN THE MATTER OF EASTERN :YIETAL PRODUCTS CORPORATION AL. CONSB:K1' ORDER , F.TC., IN REGARD TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSION ACT Docket 729_ Cumplaint, Sov. 1.9S8-Decision, Ma' 24, 19.59 Consent order requiring distributors of electrical appliances-including- irons cooker-fryers and skilet-casscl'oles- in Tuckahoe, N. , to cease representing falsely in advertising material disseminated to customers for use in resale, in newspaper advertising, on attachp.d tags and labels, and on cartons packaging its IHoducts, that exaggerated prices \were the regular retail prices; by use of the Good Housekeeping Seal of Approval, that its products had been approved and 6'laranteed by Good Housekeeping Magazine and advertised therein; and through use of the name " General Electric" that the products were manufactured by General Electric Company.

lvh'. Terml A. Jonlan for the Commission. Respondents, for themselves.

INITIAL DECISro:- BY ABNER K LIPSCOMB , HEARING EXA)!IKER The complaint herein was issued on November 5 , 1958, charging respondents with violation of the Federal Trade Commission Act by the use of false and misleading statements and represen bltions as to prices, tbe Good Housekeeping Seal of Approval and the name "General Electric " contained in or appearing on advertising material prepared and disseminated by respondents in connection with the sale and distribution in commerce of their electrical appliances, including irons, cooker-fryers and skilletcasseroles.

Thereafter, on January 19, 1959, respondents and counsel supporting the complaint herein 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 submitted to the hearing examiner for consideration.

The agreement identifies respondent Eastern l\1etal Products Corporation as anew York corporation, and respondents Arnold Troy and Seymour- Troy as individuals and president and vice president, respectively, of said corporate respondent; all respondents having their offce and principal place of business located at 135 Marbledale Road, Tuckahoe, N.

1548 FEIH:RAL TRADE CO"IMISSION Decisi01'S Onlet' 55 F.

Respondent; admit all the jurisdictional facts alleged in the complaint, and agTce that the record may be taken as if findings of jurisdictional facts had been duly made in accordance with such allegations.

I-esponc1cnl:; waive any further lJl'oceclure before the hearing examiner and the Commission; the making of findings of fact and conclusions of Jaw; and a1l 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 t.he record on which the initial decision and the decision of the Commission shall be based shall comist 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 ot.her 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 hearingexaminer is of the opinion that sllch order constitutes a satisfactory' dispositiun of this proceeding. .AcconliIlgly, in consonance 'ivith the terms of the aforesaid agreement, the hearing examiner accepts the Agrecment 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 ordcl' That respondents Eastern l\Tetal Products Corporation, a corporation, and its offcers, and .Arnold Troy and said corporationSeymour Troy, individuallr and as offcers of and respondents ' ag"ents, representatives and employees, directly or through any corporate or other device, in connection with the offering for sale, sale or distribution of electrical appliances, including irons, cooker-fryers, or skillet-casseroles, or other articles of merchandise, in commerce, as 'icommerce" is defined in the Federal Tracie Commission Act, do forth'ivith cease and desist from:

L. Representing directly or indirectly that any pnce is the ))j EASTEHCi METAL PRODUCTS CORP., ET AL. 1549 1547 Decision retail selling- price of their products which is in excess of the price at \which their products are regularly and customarily sold at retail;

2. Using the Good Housekeeping Seal of Approval in connection with their merchandise; or repre3( nting in any manner that their merchandise has been awarded said seal of approval, or that their merchandise has been approved by any other group or organization, unless such i;:; the fact; jJl'o'/)'ided, lunceve' that this prohibition shall not be consirued as prohibiting a truthful statement that a part of an article of merchandise has been approved by a group or organization, when such part is clearly and conspicuously identified;

3. l:sing the name of any company in connection with merchandise 'which has not been manufactured in its entirety by said company, or representing, directly or indirectly, that merchandise not manufactured in its entirety by a specified company, was so manufactured; ()'lidecl, lwwe.ver that this prohibition shall not be construed as prohibiting a truthful statement that a part of an article of merchandise has been manufactund by a specific company when sllch part is clearly and conspicllollsly identified;

4. Providing retailers or distributors of their products with prcticketed articles of merchandise or price lists or aclvertisin or promotional material through or by \which said retailers or distributors are enabled to mislead and deceive the purchasingpublic with respect to the matters set out in paragraph 1 herein. DECISIO OF Tile COMMISSION AND ORDER TO FILE REPORT OF COMPLIACiCE Pursuant to Section 3. 21 oJ the Commission s Rules of Practice, the initial decision of the hearing examiner shah, on the 24th day of l\larch 1959, become the decision of the Commission; and, accordingly:

It is GI'de'red That respondents Eastern Metal Products Corporation, a corporation, and Arnold Troy and Seymour Troy, individually and as offcers of said corporation, shall, within sixty (GO) 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 cease and desist.

Decision 55 F.