The Warren Woolen Co.

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IN THE MATTER OF THE WARREK WOOLEX CO. ET AL.

CONSr:XT ORDER, ETC., IN REGARD TO THE ALLEGED VIOLATION OF THE FEDEIL\.L TRADE C02\DIlSSIOX ACT Docket 8167. Complaint, Nov. 19GO-Decision, Mar. , 1961 Con..,ent order requiring distributors of woolen fabrics in Stafford Springs, Corm., to cease furnishing to garment manufacturers for attachment to clothing made from its fabrics containing no llama fleece whatsoever, cloth labels bearing the statements "53% Llaroa, 47% wool" and "Llama.Lure C03IPLAINT Pursuant to the provisions of the Federal Trade Commission Act and by virtue of the authority vested in it by said Act, the Federal Trade Commission, having reason to believe that The 'Warren 'Woolen Co. a corporation, and Richard Valentine, ,Villiam Sorenson and Richard Rugen, individually and as officers 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 jn respect. thereof would be in the public interest, hereby issues its complaint stating its charges in that respect as follows: PARAGRAPH 1. Respondent The 'Warren V;roolen Co. is a corporation organized, existing and doing business under and by virtue of the laws of the State of Connecticut, with its principal offce and place of business located in the City of Stafford Springs, State of Connecticut.

681-237--63--- , .

306 FEDERAL TRADE cO :\nSSION DECISIONS Complaint 58 F.

Respondents Richard Valentine, Wiliam Sorenson and Richard Rugen are offcers of the corporate respondent. They formulate direct and control the acts and practices of the corporate respondent including the acts and practices hereinafter set forth. Their address is the same as that of the corporate respondent. PAR. 2. Respondents arc now, and for some time last past have been, engaged in the advertising, offering for sale, sale and distribution of woolen fabrics to manufacturers of clothing. PAR. 3. In the course and conduct of their business, respondents now cause, and for some time last past. have caused, their said product, when sold, to be shipped from their place of business in the State of Connecticut to purchasers thereof located in various other States of the United States, and maintain, and at all times mentioned herein have maintained, a substantial course of trade in saiel product in commerce, as "commerce" is defined in the Federal Trade Commission Act.

PAR. 4. In the course and conduct of their business, and for the purpose of inducing the sale of certain of their fabrics, and garments made from said fabrics, respondents have furnished cloth labels to garment manufacturers for attachment by them to garments made from respondents' fabrics, which labels bear the statements, among others 530/0 Llama 17% wool" and "Llama-Lure PAR. 5. Through the use of the aforesaid statements, the respondents represented and caused to be represented that said fabric and garments made therefrom contained the fleece of the Llama. PAR. 6. Said statements and representations were false, misleading and deceptive. In truth and in fact, respondents' said fabric and the garments made therefrom did not contain any of the fleece of the Llama.

PAR. 7. By the aforesaid act and practice respondents placed means and instrumentalities in the hands of others by and through which they may mislead the public as to the fibers contained in garments manufactured from respondents: said fabrics. PAR. 8. There is a a preference on the part of a substantial portion of the purchasing public for garments made of or containing the fleece of the Llama.

PAR. 9. In the conduct of their business, at all times mentioned herein, respondents have been in substantial competition, in eom- Inercr" with corporations, firms and individuals in the sa.le of woolen fabrics of the same general kind and nature as that sold by respondents.

PAR. 10. The use by respondents of the aforesaid false, misleading and deceptive statements and representations and practices has &, &, THE WARREN WOOLEN CO. ET AL. 307 305 Decision had, and now has, the capacity and tendency to mislead 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 substantial quantities of respondents' product by reason of said erroneous and mistaken belief. As a consequence thereof, substantial trade in commerce has been, and is being, unfairly diverted to respondents from their competitors and substantial injury has thereby been, and is being, done to competition in commerce. PAR. 11. The aforesaid acts and practices of respondents, as herein alleged, were and are a11 to the prejudice and injury of the public and of respondents' competitors 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.

De Witt T. Puckett, Esq. supporting the complaint. i1famwell M. i1Jerritt, Esq. of Shepherd, llfurtha llJeTritt Hartford, Conn. , and James T. Welch, Esq. of Davies, Richberg, Tydings, Landa Duff, of 1Vashington, D. , for respondents. IXITIAI.. DECISION BY LEON R. GROSS, IIEARING EXAMINER On November 8 , 1960, the Federal Trade Commission issued a complaint against the above-named respondents, in which they "There charged with violating the Federal Trade Commission Act by misrepresenting the type of fiber contained in a fabric or in garments manufactured from their fabrics and sold in interstate commerce. A true copy of said complaint was served upon respondents as required by law. After being served "Tith said complaint, respondents appeared by counsel and entered into an agreement dated December 23, 1960 which purports to dispose of a11 of this proceeding as to all parties without the necessity of conducting a hearing. The agreement has been signed by all of the respondents, their counsel, and by counsel supporting the complaint; and has been approved by the Director Associate Director and the Assistant Director of the Commission Bureau of Litigation. Said agreement contains the fornl of a consent cease and desist order ,,,which the parties have agreed is dispositive or the issues illyolved in this proceedillg. On .January IDGI, the said agreement was submitted to the undersigned hearing examiner for his consideration, in accordance with &3.2:-) of the C011mission s Rnles of Practice for Adjudicative Proceedings.

Hespondents, pursuant to the aforesaid agreement, have admitted aJl the jmisdictionaJ facts alleged in the complaint and agreed that the record may be taken as if findings or jurisdictional facts had , 308 FEDERAL TRADE COMMISSIO:- DECISIONS Vecl"jnl1 58 F.

been duly made in accordance with such a,11egations. Said agree. ment further provides that respondents waive any further procedural steps before the hearing examiner and the Commission, the making or findings of fact or conclusions or law, and all or the rights they may lun e to challenge or contest the validity of the order to cease and desist entered in accordance with such agreement. It has been agreed that the order to cease and desist. issued in accordance ,,,ith said agree,ment shall have the same rorce and effect as if entered afjer a full hearing and that the complaint may be used in constrning the terms of said order. It has also been agreed that the record herein shall consist solely of the complaint and said agreement, and that said 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. This proceeding having now come on for final consideration on the complaint and the aforesaid agreement containing consent order and it appearing that the order provided for in said agreement covers a11 of the allegations of the complaint and provides for an appropriate disposition of this proceeding as to all parties, said agreement is heTchy accepted and is ordered filed upon this decision s becoming the decision of the Commission purslHl,nt to S 21 and 3.25 of the Commission s Rules of Practice for Adjudicative Proceedings, and the hearing examiner accordingly, makes the follon-ing jurisdictional finc1inf!s and order:

1. The, Federal Trade Commission has jurisdiction O\rcr the parties and the subject matter of this proceeding; 2. Respondent The \Yarren \Y oolen Co. is fi corporation exist.ing and doing business under and by virtue of the lan-s of the State of Connecticut, with its offce and principal.l place of business located at Stafford Springs, in the State of Connecticut; . Respondents Richard IT "lentine Wiliam Sorenson and Richard H.ugcn are offcers of the corporate respondent. They formulat.e direct and control the policies, acts and practices or the corporate respondent:

is defined 4. Respondents are engaged in commerce as "commerce" in t h0. Federal Trade Commission Act;

5. The complaint filed herein states a callse of action against the respondents under the Federal Trade Commission Act; and this proceeding is in the public interest. therefore Woolen Co. a corpo- I t -is ordered That respondents, The "\Y arre,n ration, and its offce.rs, and Richard Valentine 'iVilliam Sorenson and Richard R.ugen, individually and as offcers of said corporation, and directly or respondents' agents, representatives and e,mployees through any corporate or other device, in connection with the offering &, THE GOODYEAR TIRE & RUBBER COMPfu'Y ET AL. 309 305 Syllabus for sale, sale or dist.ribution of fabrics in commerce, as "comnlerce is defined in the Federal Trade Commission Act, do forthwith cease and desist from:

1. Using the term "Llama-Lure " or any other term, word or expression of the same import in connection with fabrics that do not contain the fleece of the Llama; or misrepresenting in any ma,nner the type of fiber contained in the fabric; 2. Furnishing any means or instrumentaEty others by and through which they may misreprescnt the type of fiber contained in garments manufactured from their fabrics. DECISION OF THE CQJDIISSIOX AND ORDER TO FILE REPORT OF COJ\IPRO:MISE Pursuftnt to Section 3.21 of the Commission s Rules of Practice the initial decision of the hearing examiner shall, on the 8th day of March 1961 , become the decision of the Commission; and, accordingly:

It i8 ordered That the above-named respondents shall, within sixty (GO) days after sery;ce upon them of this order, file with the Commission a report in writing, setting forth in detail the manner and