Foreign Textile Products, Incorporated, et al.

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

Complaint 57 F.T.C.

IN THE MATTER OF

FOREIGN TEXTILE PRODUCTS, INCORPORATED, ET AL.

CONSENT ORDER, ETC., IN REGARD TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSION AND THE WOOL PRODUCTS LABELING ACTS

Docket 7920. Complaint, June 3, 1950—Decision, Nov. 16, 1960

Consent order requiring New York City distributors of woolen fabrics to cease violating the Wool Products Labeling Act by labeling as "95% wool, 5% Nylon", woolen fabrics which contained substantially more non-woolen fibers than indicated by such tags, and by failing to conform in other respects to requirements of the Act.

COMPLAINT

Pursuant to the provisions of the Federal Trade Commission Act and the Wool Products Labeling Act of 1939, and by virtue of the authority vested in it by said Acts, the Federal Trade Commission, having reason to believe that Foreign Textile Products, Incorporated, a corporation, and Bela Gyenes, individually and as an officer of said corporation, hereinafter referred to as respondents, have violated the provisions of said Acts and the Rules and Regulations promulgated under the Wool Products Labeling Act, and it appearing to the Commission that a proceeding by it in respect thereof would be in the public interest, hereby issues its complaint stating its charges in that respect as follows:

PARAGRAPH 1. Respondent Foreign Textile Products, Incorporated, is a corporation organized, existing and doing business under and by virtue of the laws of the State of New York. Individual respondent Bela Gyenes is president and treasurer of the corporate respondent. Said individual respondent formulates, directs and controls the acts, practices and policies of said corporate respondent. Respondents' office and principal place of business is located at 303 Fifth Avenue, New York, New York. PAR. 2. Subsequent to the effective date of the Wool Products Labeling Act of 1939, and more especially since January 1, 1959, respondents have introduced into commerce, sold, transported, distributed, delivered for shipment and offered for sale in commerce, as "commerce" is defined in the Wool Products Labeling Act of 1939, wool products as "wool products" are defined therein. PAR. 3. Certain of said wool products, namely woolen fabrics, were misbranded by respondents within the intent and meaning of Section 4(a)(1) of said Wool Products Labeling Act and the Rules and Regulations promulgated thereunder in that they were falsely

FOREIGN TEXTILE PRODUCTS, INC., ET AL. 1131

1130 Decision

and deceptively labeled or tagged with respect to the character and amount of the constituent fibers contained therein. Among such misbranded wool products were woolen fabrics imported from Italy by respondents and labeled or tagged by them as consisting of "95% wool, 5% Nylon," whereas, in truth and in fact, said woolen fabrics in each instance contain substantially less wool and substantially more non-woolen fibers than was indicated by the foregoing labels or tags affixed thereto. PAR. 4. Certain of said wool products were further misbranded by respondents in that they were not stamped, tagged or labeled as required under the provisions of Section 4(a)(2) of the Wool Products Labeling Act of 1939, and in the manner and form prescribed by the Rules and Regulations promulgated thereunder. PAR. 5. The respondents in the course and conduct of their business as aforesaid were and are in substantial competition in commerce with other corporations, firms and individuals likewise engaged in the importation and sale of said wool products, including imported woolen fabrics.

PAR. 6. The acts and practices of the respondents as set forth in Paragraphs 3 and 4 above were, and are, in violation of the Wool Products Labeling Act of 1939 and the Rules and Regulations promulgated thereunder, and constituted, and now constitute, unfair and deceptive acts and practices and unfair methods of competition in commerce, within the intent and meaning of the Federal Trade Commission Act.

Mr. Harry E. Middleton, Jr., supporting the complaint. Mr. Samuel B. Ohlbaum of New York, N.Y., for respondents.

INITIAL DECISION BY JOHN B. POINDEXTER, HEARING EXAMINER

On June 3, 1960, the Federal Trade Commission issued a complaint charging that the above-named respondents had violated the provisions of the Federal Trade Commission Act and the Wool Products Labeling Act of 1939 and the Rules and Regulations promulgated under said Wool Products Labeling Act by falsely and deceptively stamping, labeling, or tagging, certain woolen products. Among such misbranded wool products were woolen fabrics imported from Italy by respondents.

After issuance and service of the complaint, the above-named respondents, their attorney, and counsel supporting the complaint entered into an agreement for a consent order. The agreement has been approved by the Director, Associate Director and Acting Assistant Director of the Bureau of Litigation. The agreement disposes of the matters complained about.

Order 57 F.T.C.

The pertinent provisions of said agreement are as follows: Respondents admit all jurisdictional facts; the complaint may be used in construing the terms of the order; the order shall have the same force and effect as if entered after a full hearing and the said agreement shall not become a part of the official record of the proceeding unless and until it becomes a part of the decision of the Commission; the record herein shall consist solely of the complaint and the agreement; respondents waive the requirement that the decision must contain a statement of findings of fact and conclusions of law; respondents waive further procedural steps before the hearing examiner and the Commission, and the order may be altered, modified, or set aside in the manner provided by statute for other orders; respondents waive any right to challenge or contest the validity of the order entered in accordance with the agreement and the signing of said agreement is for settlement purposes only and does not constitute an admission by respondents that they have violated the law as alleged in the complaint.

The undersigned hearing examiner, having considered the agreement and proposed order, hereby accepts such agreement, makes the following jurisdictional findings, and issues the following order:

JURISDICTIONAL FINDINGS

1. Respondent Foreign Textile Products, Incorporated, is a corporation organized, 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 303 Fifth Avenue, New York, New York.

2. Respondent Bela Gyenes is an officer of the corporate respondent. He formulates, directs and controls the acts and practices of the corporate respondent. His address is the same as that of the corporate respondent.

3. The Federal Trade Commission has jurisdiction of the subject matter of this proceeding and of the respondents hereinabove named and the proceeding is in the public interest.

ORDER

It is ordered, That the respondents Foreign Textile Products, Incorporated, a corporation, and its officers, and Bela Gyenes, individually and as an officer of said corporation and respondents' representatives, agents and employees, directly or through any corporate or other device, in connection with the introduction into commerce, or the offering for sale, sale, transportation and distribution in commerce, as "commerce" is defined in the Federal Trade

GORDON-MASLING OPTICAL CO., INC., ET AL. 1133

1130 Syllabus

Commission Act and the Wool Products Labeling Act, of wool products as "wool products" are defined in and subject to the Wool Products Labeling Act, do forthwith cease and desist from misbranding such products by:

1. Falsely or deceptively stamping, tagging, labeling or identifying such products as to the character or amount of the constituent fibers contained therein.

2. Failing to affix labels to such products showing each element of information required to be disclosed by Section 4(a)(2) of the Wool Products Labeling Act of 1939.

DECISION OF THE COMMISSION AND ORDER TO FILE REPORT OF COMPLIANCE

The Commission having considered the hearing examiner's initial decision, filed September 29, 1960, accepting an agreement containing a consent order theretofore executed by the respondents and counsel in support of the complaint; and It appearing that the initial decision contains a statement which is not based upon the aforesaid agreement and is, to that extent, at variance with such agreement; and the Commission being of the opinion that this departure from the agreement should be corrected: It is ordered, That the initial decision be, and it hereby is, modified by striking from said decision the second sentence in the first paragraph thereof.

It is further ordered, That the initial decision, as so modified, shall, on the 16th day of November, 1960, become the decision of the Commission.

It is further 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 contained in the aforesaid initial decision, as modified.

IN THE MATTER OF

GORDON-MASLING OPTICAL COMPANY, INC., ET AL.