Simes & Resnick, Inc.

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

IN THE latter OF SIMES & RESNICK, INC., ET AL.

CA)J\"SENT ORDER , ETC. , IN REGARD TO THE ALLEGED VIOLATIO OF THE FEDF.R \L TRADE C01tDfISSIOX AXD THE FU PRODUCTS LABELl KG ACTS Docket 8270. Complaint, Dec. 30, 1960-Decision, May 4, 1961 Consent order requiring Kew York City furriers to cease violating the Fur Products Labeling Act by invoicing artificially colored fur products as natural; by failng to disclose on labels and invoices that certain fur products were dyed, bleached, or otherwise artificially colored; and by failing in other respects to campI Y with labeling and invoicing requirements. COMPLAIN'!' Pursuant to the provisions of the Federal Trade Commission Act and the Fur Products Labeling Act, n.nd by virtue of the authority vested in it by said Acts, the Federal Trade Commission, having reason to believe that Simes & H.esnick, Inc. , a corporation, and Irving Simes and Abraham Resnick, individually and as offcers of said corporation, hereinafter referred 10 as respondents, hate violated the provisions of saiel Acts anel the Rule, and Regulations promulgated under the Fur 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:

P ARAGRA.PH 1. Simes & Hesnick, Inc. , is a c.orporation organized existing and doing business under and by virtue of t.he la,ws of the State of New York with its office and principal pla.ce of business located at 242 ,Yest 30th Street, New York, New York. Irving Simes and Abraham Resnick are officers of the said corporate respondent. These individuals formulate, direct and control the acts, practices and policies of the said corporate respondent. Their office and principal place of business is the same as that of the said corporate respondent.

PAn. 2. Subsequent to the effective date of the Fur Product, Labeling Act on August D, 1952, respondents have been and are nol' engaged in the introduction into commerce, and in the manufacture for introduction into commerce, a11(1 in the sale, advertising, and offering for sale, in commerce, and in the transportation and distribution, in commerce, of fur products; and have manufactured for srdc, sold, nc1ve.rtised, offered for sale, transported and distributed fur products which have been made in ' who1c or in part of fur which had been :-hippec1 and recei,-ec1 in commerce as the terms "commerce SIMES & RESNICK, nw. ) ET AL. 699 698 Decision fur" and "fur product" are defined in the Fur Products Labeling Act.

PAR. 3. Certain of said fur products were misbranded in that they carried labels showing the name of thc fur, without disclosing that the product was dyed, in violation of Section 4(1) of the Fur Prod. ucts Labeling Act.

PAR. 4. Certain of said fur products were misbranded in that they were not labeled as required under the provisions of Section 4 (2) of the Fur Products Labeling Act, and in the manner and form pre. scribcd by the Rules and Regulations promulgated thereunder. PAn. 5. Certain of said fur products were falsely and deceptively invoiced in that they were not invoiced a.s required under the provisions of Section 5(b) (1) of the Fur Products Labeling Act and in the manner and form prescribed by the Rules and Regulations promulgated thereunder.

PAR. u. Certain of said fur products were falsely aud deceptively invoiced in that said fur products were invoiced to show that the fur contained therein was natural, when in fact such fur was bleached, dyed or otherwise artificially colored, in violation of Section 5 (b) (2) of thc Fur Products Labeling Act. PAR. 7. The aforesaid acts and practices of respondents a.s herein alJegcd, are in violation of thc Fur Products Labeling Act and the R.ules and Regulations promulgated thereunder and constitute unfair and decept.ive acts and practices in commerce under the Fedend Trade Commission Act.

Mr. Harry E. Middleton, Jr. supporting the complaint. Respondents pro se.

INITIAL DECISION BY 'Y \LATER K. BEXXETT. I-IE.\nIXG EXA:\HXEH The Federal Trade Commission issued its complaint against the above-named respondents on December 30, 1960. The complaint charged respondents with misbranding and falsely and deceptively invoicing, fur products. Said acts Hn(I practices ".crc charged to be in violation of the Federal Trade Commission Act and the Fur Products Labeling Act.

On Fobruary 28, 1861, counsel submitted to the undersigned hearing examiner an agreement, among respondents and counsel supporting the complaint, providing for the entry wjthout further notice of a consent order. The agreement was duly approved by the Director, the Associate Director and the Assistant Director of the Bureau of Litigation.

Order 58 F.

The hearing examiner finds ihat said agreement includes an of the provisions required by Section 3.25 (b) of the Rules of the Commission, that is:

A. An admission by a.ll the respondent parties thereto of jurisdictional facts;

B. Provisions that:

1) The complaint may be llsed in construing the terms of the order;

2) The order shall have the same force and euect as if entered after a full hearing;

3) The agreement shall not become a part of the official record of the proceeding unless and until it bee-ames a. part of the c1eeision of the Commission;

4) The entire record on which any ce,ase and desist order may be based shall consist solely of the complaint and the agreement; 5) The order may be altered, modified, or set aside in the 11anner provided by statute for other orders;

C. 'Waivers of:

J) The requirement that the decision must contain a statement of findings of fact and conclusion of law;

2) Further procedural steps before the hearing examiner nnd the Commission.

In addition the agreement contains the following permissive provisions: A waiver by the respondents of any right to cha1Jenge or contest the va1iclity of the order entered in accordance with the agreement, and a statement that tlle signing of said agreement is for settlement purposes only and does not constitute an admission by rcsponclents that they have violated the law as alleged in the complaint.

Having considered saiel agreement, including the proposed order ancl being of the opinion that it provides an appropriate basis for settlement and disposition of this proceeding; the hearing examiner hereby accepts the agreement but orders that it shah not become a part of the offcial record unless ancl until it becomes a pa,rt of the decision of he Commission.

The following jurisdictional findings are made and the following order issued:

1. R.esponclent Simes & Resnick, Inc. , is a corporation existing and doing business under and by virtue of the laws of the State of K ow York, with its offce and principal place of business located at 242 IV est 30th Street, New York, New York. 2. Respondents 1 irving Simes and Abra.ham R,esnick a.re inc1ividuaJs and offcers of the corpora.te respondent. They formuhte. c1i- , SLMES & RESNICK ) I:LC. , ET AL. 701 698 Decision reet and control the acts and practices of said corporate respondent. Their address is the same as that of the corporate responde.nt. 3. The. Fe.de.ml Trade Commission has jurisdiction of the suhject matter of this proceeding and of the respondents. ORDER 1 t is ordej' That Simes & Hesnick, Inc., a corporation, and its offcers, and Irving Simes and Abraham Resnick, individuaDy and as offcers of said corporation, and respondents ' represent.atives gents and employees, directly or through any corporate or other device, in connection with the introduction, manufacture for introduction, or the sale, advertising or offering for sale in commerce or the transportation or distribution in commerce of fur products or in connection with the sale, manufadure for sale, advertising, offering for sale, transportation or distribution of fur products which have been made in whole or in part of fur which has been shipped and received jn commerce, as "commerce fur " and "fur product" are defined in the Fur Products Labeling Act, do forthwith cease ancl desist from:

1. :.Jisbranding fur products by:

A. Failing to disclose on labels that the fur product contains or is composed of bleached, dyed, or otherwise artificially colored fur whe,ll such is the fact.

B. Failing to affx labels to fur products showing in words and figures plainly legible all the information required to he disclosed by each of the subsections of Section 4(2) of the Fur Products Labeling Act.

2. Falsely or deceptively invoicing fur products by: A. Failing to disclose on invoices that the fur product contains or is composed of bleached, dyed, or otherwise artificially colored fur, when such is the fact.

B. Failing to furnish to purchasers of fur products invoices showing an t.he information required to be disclosed by each of the subsections of Section 5(b) (1) of the Fur Products Labeling Act. DECISION OF THE COMMISSIO AXD ORDER TO Fll REPORT OF COMPLIANCE Pursuant to Section 3.21 of the Commission s Rules of Practice, the initial decislml of the hearing examine:' shall on the 4-tl1 day of l\Iay U)61 , become the declsion of the Commission; and, accordingly: It is onle1'ed That the respondents llCrein 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 manller and form in which they have complied with the order to cease and desist. 702 FEDERAL TRADE COMMISSION DECISIOKS Order 58 F.

YIAURICE J. Fell ET AL. TRADING AS THE ENURTOXE COYIP ANY l\ODIFfF.D ORDER, ETC. , IN REG/I.RD TO THE ALLEGED VIOLATION OP THE FEDERAL TRADE COM?-fis8ION ACT Docket 6564. Modified order, May 5, 1961 Order modifying desist order of Oct. 2 1D5D (5G 1", T. C. 36-1), to comply with decree of the Ninth Circuit Court of AppeaJs, by substituting the words caused by" for the word "involving Before ilfT. Earl J. K olb hearing examiner. illi'. John J. Men ally for the Commission. ilfT. Harold ECUton, Mr. Theodore J. Elia. and Mr. Robert B. HudMn all of Los AngcJes, Calif., for respondents. ORDER l\IOnTPYING CEASE AXD DESIST ORDER '1'0 BRIXG IT INTO CO:KFOIDIITY \WITH THE DECREE 01 THE TINITED STATES COURT OF APPEALS Fon THE nNTH CIRCUIT This matter having been brought before the Commission by the appeal of counsel supporting the complaint from the initial decision of the hearing examiner entered on the 2Jth clay of February 1959; and, the Commission having heard the appeal on the plen.dings, testimony. st.ipulation, exhibits, briefs and oral argument of counsel; and The Commission, after duly considering the whole record and being full)' dvised in the premiscs, having on the 2nd da)' of October 1959, issucd its final order in which it modified the initial decision and the order to cease and desist entered by examiner as aforesa.id and adopted the initial decision as modified as the decision of the Commission; and Respondents having fied in the L.nitcd States Court of Appeals for the :Ninth Circuit their petition for the review of the order to cease and desist issued b)' the Commission on the 2nd day of October 1959, as aforesaid, pra.ying that the order be set aside or, in the alternative, be modified to conform to the form of the order contained in the initial decision of the examiner entered on the 24th day of February 1959, as aforesaid; and The United States Court of Appeals for the Xinth Circuit having on the 22nd day of December 1960 (285 F.2d 879 (6 S.&D. 875J), handed down its opinion in which it, for reasons therein stated modified the prohibitory paragraph of the order entered by the THE ENURTQXE COMPANY 703 702 Order Commission on the 2nd day of October 1959, as aforesaid, by eliminating therefrom the wonl ':in' olying:' and substituting therefor the words "caused by" so that the paragraph of thc order shall read as follows:

That the use of said device is of value in stopping bed- wetting or correcting the bed-wetting habit unless expressly limited in a clear and conspicuous manner to cases of bed-wetting not caused by organic clef eets or diseases.

ABd as thus modified, a,ffrmed the order and (1directed enforcement.; ana on the 18th aay of J annary 1961, entered its final decree in which it modified the final order of the Commission as hereinabove set forth and as thus modified, affrmed said order and commanded Maurice J. Feil and Leo A. Loeb, individually and as copartners trading as The Enurtone Company to forthwith obey and comply with the terms of the order as thus modi!led; and the time allowed for filing a petition for certiorari having expired and no such petition having been filed; and The Commission being of the opinion that its said order to cease and desist, issued on the 2nd day of October 1959, as aforesaid should be brought into conformity with the aforesaid decree of the Cnited States Court of Appeals for the Ninth Circuit mol1ifying the said order to cease and desist, as aforesaid; Now, therefore, it is hereby ordered That the order to cease and , asdesist issued by the Commission on the 2nd day of October 1959 aforesaid, be modified to read as follows: It i8 ordered Thm respondents Maurice J. Feil and Leo A. Loeb individually and as copartners trading as The Enurtone Company, and their respectiveor trading under any other,r name or names, agent.s, representatives, employees and lessees, directly or through any corporate or other device in connection with the offering for sale, sale, leasing or distribution of a device known as "Enurtone or any other device which functions in substantially the same manner, in commerce, as "commerce" is dermed in the Federal Trade Commission Act, do forthwith cease and desist from representing, directly or indirectly:

That the use of said device is of value in stopping bed-wetting or correcting the bed-wetting habit, unless expressly limited in a cle::tr and conspicuous mrmner to cases of bed-wetting not caw::ed by organic defects or diseases.

It i8 That respondents shall, within 30 days after f1!T:her ordered scrvicr upon them of this order, file with the Commission a report in writing, setting forth in detail the manner and form in which 704 FEDERAL TRADE COl\lMISSIO DECISIONS Order 58 F.

they ha\ e complied with the otc1e1' io cease and desist as hercinabove modified.

1 t is frurther ordered That the modified order as here issued shan be served upon respondents in the same manner as was the original ordcr to cease nnd desist.

Ix THE JIATTER OF :\IORTON' , INC., ET AL.

)IODIFIED ORDER, ETC. , IK REGARD TO THE ALLEGED VIOLATTQ:: OF THE FEDERAL TRADE CO::DI1SSlOX AXD THE FUR PRODUCTS I,,\TIELING L\CTS Docket 6976. Jfodijied o1"der, May, 1961 Order modifying desist order of Feb. 25, 19GO (5G F. '1', C. 965), to comply with clecree of First Circuit Conrt of Appeals, by eliminating Paragraph A (3) and Paragraph D.

Before Ji?. W-iimn L. Pack, hearing exmn iner. il?'. Ilar?'y E. liiddlet.on, J,' and ill?', Thomas Zieba1'h for the Commission.

(;ute1'7nml H Ol''VlfCj Rubi' l1. of Boston fa.ss. for respondents. ORDER :lIODIFyr:VG ORDER TO CL\SE J.KD DESIST SO .AS TO nmdc IT IXTO CONFORJIITY ,WITH THE DECREE OF THE 1::;lted S'L\TES COURT OF APPEALS FOR THE FIRST CIRCUIT This proceeding hrwhlg been heard by the Commj sion upon its review of the whole record, including briefs a.nd oral argument; and the Commission having rendered its decision and having issued Hs order to cease and desist on February 25 , 1\)60; alll Respondents Imving filed in the l united States Conrt of Appeills for the First Circuit their petition to review and set aside the order to cease and desist, and that Court having 1'8,nc1ercc1 its decision on January 24, 1961 (286 F.2c1158 C7 S.&D. 6J), eliminating therefrom Paragraph A(3) "which prohibited the misbranding of fur products by- (3) Failing to set forth all the information required unrler Section 4(2) of thc 1"11 Products Labeling Act anil the Rnles ilnd Hcgulatlolls promulgated thereunder on one side of the labels; a-nd setting aside. Paragraph D which prohibited respondent from- 1 TJJC Par:lg-raphs set aside read as follows: (3) Fallng to set forth alj the information required lJll1el' Section 4(2) of the Fur Products Labeling Act and the Rnles and Regulations promulgated thereunder on oue side of the labels ;

D- )'taking pricing clairus or representations of tile t:'' pe refened to in Pnl'fJgraph C above, unless there Is (sick Inaintained by respondents full a1Jel adequnte records dI5('lob. Ing the facts upon ,,-hie/! such claims or representations are based ; , MOHTON' ) I ) E'l' AL. 705 704 Order D. J\Iaking pricing claims or representations of the type referred to in Paragraph C above, unless there is (sick maintained by respondents fuJl and adequate records disclosing the facts upon which, such claims or representations are based; and the Court having :issued its decree on .J fllHtary 25, HHH, affrming and directing enforcenlent of the. Commission s order as thus modified; and the time a.Uowed for filing a petition for certionul having expired and no such petition having been filed; and The Commission being of the opinion that its said order to cease and desist, issued February 25, 1960, 811ou1(1 be brought into conformity with the aforesaid decree of the United States Court of Appeals for the First Circuit modifying the said order to cease and desist, as aforesaid;

VOlO , thel'cf01' , it is he1'cby 01'dered That the aforesaid order to ceflse and desist be modified to read as follows: It is ordered That the respondents, )Iorton, Inc., a corporation and its offcers, and Hyman Gondelman and l\Iorton J\T. Gondelman individually and as officers of sllid corporation, and said respond ents agents, representatives and employees directly or through any corporate or other device, in connection with the introduction or manufacture for introduction into commerce, or the sale advertising or offering for sale in COlTnnerce, or the transportation or distribution in commerce of any fur product, or in c.connection with the manufacture for sale, sale, advertisi.ng, offering for sn.le, transportat.ion 01' distribution of any fur proch1ct which has been made in whole or part of fur which luis been shipped and received in commerce, as "commerce fur " and "fur products" ate defined in the Fur Products Labehng Act, do forthwith cease and desist from: A. :Misbran(ling fur products by:

(1) Fading to affx labels to fur products showing in words and figures plainly legible. all information required to be disclosed by each of the subsections of Section 4- (2) of the Fur Products Labeling Act.

(2) Setting forth on labels affxed to fur products: (a) on-required information mingled with required information; (b) Require.d information in handwriting. B. Falsely or deceptively tdvertising fur products through the use of any advertisement, representation, public annouIlcement, or notice which is intended t.o aid, promote, or assist, direct.y or in- ClircctlY1 in the. sale or offering for sale of fur products, and which fails to disclose the Iml1e or names of the animal or nima1s producing tllc fur 01' furs contained in t.he fur product, as set i:orth in GS1 237- 706 FEDERAL TRADE CO::IMISSION:- DECISIOKS Decision 58 F.

the Fur Products Xame Guide and as prescribed under the Rules and Regulations.

C. Falsely or cleceptiycly advertising fur products throllgh use of any a.advertisement, representation, public announcement or notice which is intended to aid, promote or assist, directly or indirectly, in the sale or offering for sale of fur products and which represents directly or by implication that thc regular or usual price of any fur product is any amount which is in excess of the price at \vhieh respondents have usually sold such products in the recent. regllbr course of their business.

1 t is further ordered That respondents shall, within 30 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 ns hereinabove modified.

It i8 fw.ther o1'dered That the modified order as here issued shall be served upon respondents in the same manner as was the original order to cease and desist.