Rootes Motors Incorporated

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Ix THE MATI'ER OF ROOTES WTORS INCORPORATED, ET AL. COXSEXT ORDER, ETC. , IN REGARD TO THE ALLEGED VIOLATION OF FEDEIL\L TK\DE CO nIISSION ACT Docket 8011. Compl.aint, Aug. 9, 1960-Decis.ion, Feb. , 1961 Consent order requiring Long Island City, X. , distributors of imported cars to cease representing falsclr in adverti. ing in newspapers and periodicals that part'" and services were immediately available to purchasers of their automobiles in all areas of the United States. CO?tlPL\IXT Pursuant to the provisions aT the Federal Trade Commission Act and by virtue of I.he authority vest eel in it by said Act, the Federal Trade Commission, having reason to believe that lioates 1\1motors Incorporated, a eOl'poration, and John T. Panks and Peter Lloyd- Owen, individually and a.s offcers of said corporation, hereinafter referred to as respondents, have violated the provisions of said Act and it appearing to the Commission that. a proceeding by it in respect thereof would be in the pubhc interest, hereby issues its complaint stating its charges in that respect as follows: PAIL-\GRAPII 1. Respondent Hootes 310tors Incorporated is it corporation organized, existing and doing business and by virtue of the la.\ys of the Sta.te of Delaware\ with its offce and principal place of business located at .12-32 21st Street, Long Island City, Xew York. Respondent ohn T. Panks is Director llnd Vice President of said corporation and respondent Peter Lloyd-Owen is Secretary-Treasurer of said corporation. Their addresses are the same as that of the corporate respondent. The individual respondents formulate direct find control the acts and practices of said corporate respondent including those hereinafter alleged.

PAIL 2. Hesponde,nts are no\" and for more than two years last past have been, engaged in the sale and distribution of imported aut.Q11obiles.

In the regular and usual course and conduct of t.their business respondents now cause, and for more than two years last past have caused, said automobiles \yhen sold to be t.rfinsported from the ports of entry in various States of the Fnited States to dealer-purchasers thereoi, located in \'1rio115 other States of the United States and in the District of Columbia for resale to the purchasing public. Respondents maintain, a.nd at a.11 times mentioned herein, have maintained, a substantial course of trade in said automobiles in ROOTES MOTORS INC. , ET AL. 129 128 Complaint commerce among and between the various States of the United States and iu the District of Columbia.

PAR. 3. At all times mentioned herein respondents have been nncl are now, in direct and substantird competition with other corpo- Tations, iirms and individuals engaged in the sa,le and distribution of automobiles in commerce.

PAH. 4. In the course and conduct of their business as aforesaid and for t.he purpose of inducing the sale of their automobiles in commerce, respondents have ('aused, and now cause, the publication and dissemination of certain statements and representations in nmvspapers and periodicals having general cireu1at,ion. Typical, but not all inclusive, of said statements arc the fol1moving: Service and parts readily available.

You can buy a Hilman, Sunbeam, Singer 01' Humber (and get parts alld scryice for it) in oyer 700 S. towns-Hawaii and Alaska too. They are barked by factory parts depots right here in the States, supplying a large truly reputable dealer organization that pro,ides superior service close at hab(1.

'" '" '" The:, knmy the ' ran depend on nooles coast to coast facilities for prompt and courteol1S service.

m. 5. By means of the aforesaid statemcnts and representations respondents have represented, and do represent, directly or by implication that p trt.s and service are immediately ava.i1able to purchasers of their automohiJes in all areas of the United States. PAR. 6. The aforesaid statements and representations are false misleading and deceptive in t.hat in many instances respondents and their dealers do not have available jhe parts for the repair of the automobiles sold by them, and in many instances such parts cannot be obtained for substantial periods of time and, therefore, prompt service cannot be rendered by respondents dealers. PAR. 7. The use by respondents of the aforesaid false, misleading and deceptive statements and repre.sentations has had, and now has the capacity and tendency to, and does, mislead,c1 a.nd deceive members of the purchasing public into the erroneous and mistaken belief that said statements and representations \were and are true, and into the purchase of a. substantiflJ quantity of respoll(lents' automobiles because of such errOlJeOUS and lnistaken heEef. As a result thereof, substantial trade has been, and is being. unfairly cliverted to respondents froni t.their eompetitors Hnd slibstantia1 injury has been, and is being, done t hereby to competition in commerce.

PATI. 8. The aforesaid acts an(l prftcties of responclsn1s, n.s herein a1Jeged, were 1ll(1 are a11 to the pl'ejucliee ilnd injury of the pl1b1ic and of respondents: c.ompetitors find eonstitlltecl. and now constitute unfair and (leceptive acts and plac.tices and unfair met.hods of compe- 6SI. :J7- 1(1 130 FEDERAL TRADE CO",IMISSION DECISIONS Decision 58 F.'1' tition, in commerce, within the intent and meaning of the Federal Trade Commission Act.

Mr. John TV. Brookfield, Jr. for the Commission. Mr. Nathan Shapiro and Mr. Berthold H. Hoeniger of New York , for respondents.

INITL\L DECISION BY AnxER E. Lusco:\IB, HEAIUXG EXAl\IIXER The complaint herein was issued on August 9, 1960, charging Respondents with violation of the Federal Trade Commission Act by the dissemination of false, misleading and deceptive statements and representations that parts and service are immediately available to purchasers of their automobiles in all areas of the United States. Thereafter, on Novemher 7, 1960, Respondents, their counsel, and counsel supporting the complaint herein entered into an Agreement Containing Consent Order To Cease And Desist, which was approved by the Director, Acting Associate Director and Assistant Director of the Commission s Bureau of Litigation, and thereafter, on December , 1960, submitted to the Hearing Examiner for consideration. The agreement identifies Respondent Bootes J\fotors Incorporated as a Delaware corporation, with its offce and principal place of business located at 42-32 21st Street, Long Island City, New York, and Respondents John T. Panks and Peter Lloyd-Owen as Director and Vice President, and as Secretary-Treasurer, respectively, of said corporation, their addresses being the same as that of the corporate respondent.

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 t.he 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 OIl 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 settement purposes only and does not constitute an admission by Respondents that they have violated the law as alleged in the complaint. RITZ THHIFT SHOP, IXC., ET AL. 131 128 Syllabus After consideration of the allegations of the complaint, and the provisions of the agreement and the proposed order, the lIeaTing 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 tlutt 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 1 t is ordered That Respondent Rootes Motor Incorporated, a corporation, and its offcers and Respondents John T. Panks and Peter Lloyd-Owen, individually and as offcers of said corporation and Respondents' agents, representatives and employees, directly 01' through any corporate or other device, in connection with the offering for sale and sale of automobiles in commerce, as "commerce" is defined in the Federal Trade Commission Act, do forth wi th cease and desist from representing, directly or by implication, that parts and service for said automobiles are immediately available in any area of the United States where such parts and service are not in fact so available.

DECISION OF THE COl\DIISSIOX AND OUDER TO FILE REPORT OF CO::IPLIANCE Pursuant to Section 3.21 of the Commission s Rules of Practice, the initial decision of the hearing examiner shall, on the 2nd day of February, 1961, become the decision of the Commission; and, accordingly:

1 t is ordered That respondents Rootes ;\Iotors Incorporated, a corporation, and John T. Panks and Peter Lloyd-Owens, individually and as offcers 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.