Modern Methods, Inc

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

IN Tile :MTTR MODERN METHODS, IKC., ET AL.

ORDER, ETC. , IN REGARD TO T)UJ ALLEGED VIOLATION OF TI-IE FEDERAL TRi'. DE COJ\DIISSIOK ACT Docket ('568. COinplaint, Au.g 1,959-Decision, Feb. , 1962 Order dismissing, for procedural irregularities, initial complaint charging York City sellers with advertising falsely that their correspondence courses could be relied on by women to make normally heavy or t.hin legs shapely 719-603--64-- 310 FEDERAL TRADE" COM:lISSIOX DECISIOKS Complaint 60 F.

and alluring, and with sending out collection letters under other names which represented falsely that they turned over delinquent accounts to an independent organization to enforce collection, among other things. IPLAINT Pursuant to the provisions of the Federal Trade Comnlission Act and by virtue of the authority vested in it by said Act, the Fcdcml Trade Commission, ha viug reason to believe that I\fodern iethoc1s Inc., a corporation, and Harold Brooks, individually and as an offcer 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 bc in the public interest, hereby issues its complaint stating its charges in that respect as follows:

PARAGRAPH 1. Respondent Modern Methods, Inc., is a corporation organized, existing and doing business under and by virtue of the laws of the State of New York, with its principal offce and phtce of busine,s located at 296 Broadway, in the city of New York, State of New York. Respondent Harold Brooks is president of the corporate respondent. Said individual respondent formulates, directs and controls the acts and practices of said corporate respondent, including the acts and pmctices hereinafter set forth. The address of the individual respondent is the same as that of the corporate respondent. PAR. 2. Respondeutsare now, and for some time last past have been, engaged in the advertising, offering for sale, sale aud distribution of correspondence courses of instruction, including cosmetic lotions and lnassagers for use in connection therewith. These courses are entitled "12 'WEEK Scientifie Home Course to add alluring curves to SKIN Y LEGS" and "12 WEEK Scientific Home Course to seenderize HEAVY LEGS", hereinafter referred to as the " Skinny Legs course and "Heavy Legs" course, respectively. Said courses purport to aecomplish for the purchasers thereof the desired cffects described in the captions set forth.

PAR. 3. In the course aud conduct of their business, respondents now cause, and for some time last past have caused, their said products when sold, to be shipped from their place of business in the State of K ew York 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 said products 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 . . .

MODERK rETHODS, I , E'I AL. 311 309 Complaint, purpose of inducing the sale of their courses of instruction, responc1 cuLs have inade certnjll sta.tements with respect. to said courses in advertisements in magttzines and periodicals of-general circulation and in circulars, form letters a,nd other literature sent to pel'sonsans"erulg said ma.gazine and periodical advertisements, of which the follo\ving are typical:

FA'l' LE-GS Try this new, amazing, scientific home method to Reduce, Ankles, Calves, Thighs, Knees, Hips for SLlDNDERIZED LEGS FREB! "How To Slenderize YonI' Personal Heavy Leg Problems Book-also packed with actual before and after Ph oto photos 'Of women wha obtained remarkable resuits! Beautifully firm, slenderized legs help the rest 'Of your figure laok slimmer, more appealing! aw at last, yau too can try to help yourself imprave heavy legs due to normal causes, and reduce and reshape ANY PART 'Of your legs yau wish. . . or your legs all aver. . . as many BEFORE women have by fallawing tils new scientific method. Well-known authority -on legs with years 'Of experience 'Offers yau ths tested and proven scientific course-only 15 minutes a dayin the privacy of your home! Contains step-by-step ilustrations of the easy scientific leg technique with simple instructions for slenderized, firmer, stronger legs; improving Photo skin color and circuation of blood in legs, plus leg measurement chart.

Limited Time FREE OFFER For your Free book an the Home Method of Slenderizing Heavy Legs mailed in plain wrapper, without obligation, just send name and AF1' address.

FREE How to Slenderize Your Personal Heavy Leg Problems" Book-also packed with actual before and after photas of wamen who obtained remarkable results: )Iailed in Plain wrapper without 'Obligation.

(Picture of book) \ . ,:,,) , . 312 FEDERAL TRADE COMMI&SION DECISIONI' Complaint 60 F.

* '" * Now. . . The COMPLETE Al illusive 12 'Veek Course for FAT LEGS'" I( '"

So right now I want to ask you-do you really want alluringly graceful, feminine legs? Are you wiling to devote fifteen enjoyable minutes a day faithfully carrying out the instructions I send you? * , Included with the course is a complete 3-piece HOME ::IAS SAGE KIT to be used with the Heavy Legs Course, and it' s yours ABSOLUTELY FREE if you enroll within ten days. (See enclosed description. how the complete, all-inclusive 12 WEEK IE COURSE helps you to slenderize A VY LEGS * * Ij I Ki\O"VV that tile ankles, calves, knees, thighs, and the hips of the femininc legs, if normal, have responded to the tested, scientific leg exercise techniques I have perfected. Moreover, the heavier and flabbier your legs, the BETTER I LIKE IT and the more interested I am in helping you. WOCLD YOU TRADE ABOUT FIFTEEI\ MINCTES A DAY OF YOCH Sl-ARE THIE FOR A LIFETIME m' BEAUTY'IFUI SHAPELY LEGS? * * * This Valuable Deluxe 3-Piece HO:-IE :\IASSAGE KIT TO BE USED ,'with THE HEAVY LEGS COURSE! If you mail the enclosed personal enrollment form within the nemt TEN DAYS.' GET THESE THREE FREE GIFTS FOR PROMPT ACTION! They are worth almost as much as the price of the "Complete Shapely Legs Home Course," Just see what you are to receive at no extra cost under this remarkable offer !, MODERN METHODS, INC. , ET AL. 313 309 Complaint THI LEGS Try this new amazing scientific home method to ADD SHAPELY C"CRVES at ankles, calves thighs, knees, hips! FHEE! "How to Add Alluring Curves '1' Correct Your Personal 'thin Leg Probleil Book-also packed with actual before and after photos of women who obtained romarl;:able Photo results! Skinny legs rob the rest of your figure of attractiveness! Now at last you too can try to help yourself improve underdeveloped legs, due to normal causes, and fill out any part of your legs I you wish, or your legs all over as many women! have by following this liew scientific method. 'VeU known authority on legs with years of ex- BEFORE perience offers you this tested and proven scion- I tiflc course-only 15 minutes a clay-in the privacy of your home Contains step-by-step ilustrations of the easy SCIENTIFIC LEG technique with simple instructions: gaining shapely, stronger legs, improving skin color and circulation of legs. Photo Limited 'Time FREE OFFER! For your free book on the Home :Method of Developing Skinny Legs mailed in plain 'vrapper. without obligation, just. send name and address. REE "How to Add Alluring Curves To Correct Your Personal Thin Leg Problems Book-also pac1 ed with actual before AFTBil :: i per without obligation. "

(Picture of Book) :\Tmv . . . The CO::IPLETE ALL-Inclusive 12 Week Course for Skinny LEGS' . , In the ("course of my experience I baye treated every kind of leg problem: straight hips, skinny thingh, bony knees, strillgbean calves, toothpkk ankles. And I can help you too ! ) .

314 FEDEEAL TRADE. CO IMISSION DECISIONS Complaint 60 F.

Included \with the course is a complete 3 Piece Deluxe HOMEMASSAGliJ KIT for Skinny Legs, and It' s yours ABSOLL'TELY FREE if you enroll within ten days. (See enclosed description.

'" 11 * hmv the complete all-inclu.sive 12 WEEK Hmri COURSE helps you add alluring curves SKIKXY I-iEG S , Yes, buy a pair of exquisite legs to have for your very own, alluring, enticing legs you would be proud to show in shorts, or a bathing suit; legs men would admire and other women ellvy. * '" * . * '" This Valuable Deluxe 3 Piece HOME :'IASSAGE KIT TO BJ. USE:D 'WITH THE HEAVY LEG S Course If you mail the enclosed personal enrollment form within the next TEN DAYS! GJ.JT '.rHESE 'three FREE GIFTS FOR PROMPT ACTION;\T! They are worth almost as much as the price of the " Complete Shapely Legs Home Course." Just see what you are to receive at no extra cost under this remarkable offer'" '" '"

PAR. 5. Through the use of certain of the statements set forth in Paragraph Four and others similar thereto, respondents have represented that their Heavy Legs course provides an effective and reliable means for women with fat or heavy legs, except those due to abnormal eauses, to reduce and reshape all or any part of their legs and to make them shapely and alluring.

PAR. 6. The aforesaid statements and representations were and are false, misleading and deceptive. In truth and in fact, said Heavy Legs course does not provide an effective or reliable means for women with fat or heavy legs, whether due to normal or abnormal causes, to reduce or reshape all or any part of their legs or to make them sbapely or alluring.

PAR. 7. Through the use of certain of the statements set forth in Paragraph Four and others similar thereto, respondents have represented that their Skinny Legs course provides an effective and reliable means for W01nen with thin or skinny Jegs, except those clue to abnormal causes, to fill out all or any part of their legs and to make them shapely and alluring.

PAR. 8. The aforesaid statements and representations were and are false, Inisleading and deceptive. In truth and in fa, , saiel Skinny Legs course does not provide an effective or reliable means fol' ,yom en MODER VIETHODS INC. , ET' AL. 315 309 Complaint with thin or skinny legs whether due to norma.l or abnormal causes to fill out all or any part of their legs or to make them shapely or alluring.

PAR. 9. Through the use of certain of the statements set forth in paragraph 4 and others similar thereto, respondents have represented that a book on either how to slenderize fat legs or how to add shapely cllrves to thin legs containing specific information concerning the methods and techniques to be follmved in achieving such results will be sent free to persons replying to respondents' magazine and periodical advertisements.

PAR. 10. The a.foresaid stntclnents and representations were and are false, misleading and deceptive. In truth and in fact, respondents do not send any free book containing specific information concerning the methods or techniques to be employed in either .slenderizing fat legs or adding shapely curves to thin legs. The only "books" respondents send to persons responding to their magazine and periodical advertisements are two pamphlets, one relating to the I-Ieavy Legs course and the other rebting to the Skinny Legs course. Each pamphlet is approximately twelve page.s in length and consists primarily of advertising claims in the nature. of testimonials, along "with a genend description of the course to 'which each relates. PAIL 11. Through the use of certain of the statements set forth in paragraph 4 tnd others similar.r thereto, respondents have represented that a ;1-piece massage kit consisting of an electric "Stim- Leg massager, a "Limber Lp ' lotion and " Tone formula, worth almost the price of either courses, will be given free to women who return a completed enrollment form for either the Skinny Legs course or the IIeavy Legs course \within ten days after receipt of such form. PAR. 12. The aforesaid statements and representations were and ilre false, misleading and deceptive. In truth and in fact, the ;)-piece massage kit is not sent free to women returning in ten days either completed enrollment form for the Skinny Legs course or for the I-Ieavy Legs course. Nor is such kit worth almost the price of either course. The "Limber Up" lotion nnd the "Tone 1Jp" formula are sent only after $3.00 or more is submitted with a completed enrollment form; said lotion and formula, moreover, must be returned, along wit.h the "86m- Leg" massager and all other materials furnished by respondents in the event a purchaser elects to avail herself of her rights under the money back.; prm'ision, which becomes operative only ftfter one of the courses has been completed and paid for. The "Stim Leg" massager js not. sent until the purchaser is ready for the sixth lesson of one of respondents' courses a.nd only then if pa,yments are current with not less than ;;15.00 having been paid. , Initial Decision 60 F.

PAR. 13. In collecting or attempting to collect delinquent accounts arising in connection with their business, respondents have sent out collection letters or notices under name or names other than their own, such as Legal Claims Department: which represent or imply that respondents have turned over such accounts to a separate nnd independent organization to enforce collection thereon. In truth and in fact said letters or notices are not sent ant by a separate or independent organization but are sent out by respondents themseh es for the purpose of col1acting their own a,accounts. PAR. 14. The nse by the respondents of the aforesaid false, misleading and deceptive statements, representations and practices has 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 represent.ations were and are true a,lld into the purehPuse of substantial quantities of respondents' products by reason of said erroneous and mistaJi:ell belief.

PAn, 15. The aforesaid acts and practices of respondents, as herein alleged were and are all to the prejudice and injury of the public and constituted, and no" constitute, unfair and deceptive acts and practices, in commerce, ,,,within thc intent and meaning of the Federal Trade Commission Act.

lift. Hal' old A. I(ennedy supporting the complaint. jJb.. Horace Donnelly, Jr., of \Vashington for respondents. IXIT.u. DECISION BY LEOX R.. GROSS : I-IEAJu!,C-G EXA?IINER l"'RELBITX ARY ST.ATKHEXT R.respondents advertise for sale and sell through the United States mails, from their ollce in New York Cit.y, in interstate commerce correspondence courses designated 12 IV eel, Scientific Horne Comse to slenderize HEA. VY LEGS for bulging hips-flabby tllighs-bnIging kneesheavy calves-heavy ankles-strcllgthening feet ami arches.

and 12 Vi eek Scientific Borne Course to add allming curyes to SKIN::TY LEGS for straight hips-sera wny thighs- bony knees-thin calves- thin ankles- strengthcning feet and arches. loJODERX METHODS ) INC. , ET AL. 317 309 Initial Decision On August 29, 1959, the Federal Trade Commission issued a complaint aga,inst the respondents charging them with violating the Federal Trade Commission Act by engaging in falso, misleading and deceptive acts, practices and representations in advertising, offering for sale, sening and disseminating in interstate commerce the afore 111clltioned "heavy legs" and "skinny legs" courses. The respondents answered the complaint, issue was joined, and full hearings have been cOlTlpleted. This initial decision is based upon t.he entire record including the testimony of witness2s and exhibits in evidence. Proposed findings and conclusions and suggested order have been filed by the parties and oral argument thereon was heard. In 1952, a "Cuited States Post Offce Department's Hearing Examiner, in a proceeding then pcnding there, recommended the revocation of mailing privileges of respondents pursuant to the provisions of 39 U.S. Code, 9259 and 9732 (Hearing Examiner s Docket 1-234). On July 18 , 1956, the Solicitor for the Post Offee Department reversed the I-Iearing Examiner and dismissed the proceedings "without prejudice. " Respondents' publications which are the subject matter of the Post Offce proceedings are in evidence as CX 19 and CX 20. They sold for $1.98 each and are different from the courses "which are the subject matter of t.his proceeding (CX 1 and CX 2) and which sell for $29.95 each.

Respondents pleaded the Post Offce proceedings as res judicata but such plea "as denied by this hearing ex,uniner. The Federal Trade Commission, on December 31 , 1959, on interlocutory appeal affrmed the ruling of the hearing examiner. On November 29 , 1960, the examiner struck from the record respondents' exhibit 60 for reasons which are set forth in said ruling. Such reasons, inter alia, are the fact that respondents sought through such exhibit 60 to place in this record selected portions of the Post Offce record without affording C01mnission s counsel an oppOltunity to cross-examine the witnesses whose testimony was reproduced in RX 60, and without tendering the Post Offce record in its entirety. R.espondellts also offered in evidence testimony of ,vitnesses characterized as "satisfied customers." Over the strenuous objections of counsel supporting the complaint, the examiner permitted bvo such satisfied customers, Edith 111nic1ore and Freda Garman, to testify. The examiner denied the motion of counsel supporting the complaint to strike the testimony of the witnesses Amiclore and Garman, but in the same ruling also denied the request of respondents to intro- 318 FEDERAL TRADE CO vfISSION DECTS,IONS Inital Decision 60 F.

dues any further testimony of "satisfied customers." 1 The examiner refused evidence proffered by counsel supporting the complaint for the purpose of establishing what is a "shapely and alluring" female leg. The first witness who testified on this issue stated in substance that what is a "shapely and alluring" female leg is an empirical judgment which could vary from person to person. It appeared the examiner that further testimony of this character would not be of material assistance in deciding the principal issues framed by the pleadings.

Aside from the testimony of respondents' cust0111ers, Edith Amic10re (Tr. 678) and Freda Garman (Tr. 710), of respondent Harold Brooks and of Richard Stalvey, this record consists chiefly of the testimony of experts. These witnesses, who ate either ?\I. s or physIotherapists were caIIed to give an expert professional opinion whether respondents courses will, or will not, accomplish that which respondents represent they wil accomplish.

All motions made by the parties which are not specifically ruled upon in this initial decision or have not previously been ruled upon hereby are overruled and denied.

On the basis or the entire record in this proceeding the examiner lIlRkes the findings or fact and conclusions hereinafter set forth. Findings requested by counsel which are not specifically adopted and incorporated in this initial decision are rejected. The fact that the exarniner has not incorporated in this decision nor specifically rejected nor stricken specifically, evidence which is in the record should not be construed as indicating that such evidence has not been fully considered by the examiner in preparing this decision. It indicates ll1erely that the evidence which the exan1iner has specific .lly incorporated in his findings of fact is suffciently preponderant, relevant probative, and substantial for a proper adjudication or the issues involved in this proceeding.

On the basis of the entire record, including the testimony of all the witnesses and the exhibits, the examiner makes the following FINDINGS OF FACT Respondent 110dern lethods, Inc., anew York corporation, organized in 1951, has its principal offce and place of business at 206 Broadway, Kew York, N.Y. It is now, and ror some tin1e last past, has 1 See Erickson v, FTC 272 F. 2d 318; Basic Books, Inc. v. FTC 276 F. 2rl 718, 720; Wybrant System Products Corp. 26G F. 2d 571, Oert. den. 361 U, S. 914; Witkower Press, Inc. Docket 6583, Aff' by Commission, July 19 , 1960; Evis Manufacturing 00. Docket 6108, Commission Decision of March 23, 1960, appeal pending; United States v. Hoxsey, 198 F. 2d 273 (C. A. 5 1952) ; and Loesch Hair Experts, 257 F. 2d 882. See Examiner Ruling of October 17, 1960, which is hereby incorporated herein and by reference made a part hereof.

MODERX :\fETHODS, IXC. , ET' AL. 319 309 Initial Dell;;jnn been engaged in advertising, offering for sale, selling and dist.ributing correspondence courses which are characterized as follows: 12 'V eel;:

Scientific Home Cour"e to slenderize HEAVY LEGS for bulging hips-flabby thighs-bulging" knees- 'fl '. calves-heavy ankles-strengthening feet and arches. and 12 Week Scientific Home Course to add alluring curves to SKINKY LIDGS for straight hips-scrawny thighs-bony knees-thin calves-thin ankles-strengthening ff'et and arches. These courses are in evidence as ex 1 (Heavy Legs) and ex g (Skinny Legs). Respondents sell approximately 100 such courscs pcr month, at a price of $29. . The courses, ",which consist of t"\ych,c consecutive weekly courses of exercises to be performed at horne are sold chiefly through the United States mails to persons residing in many States of the Union, other than New York State. The corporate respondones approximate annual business for 19GO was S200 OOO per annum, of which 90 percent was done outside ew York State. A Sll1an hand vibrator and skin lotions, ex 21 , 22 and 2:3, are sent to customers who have paid in aU the money clue n-fer the. sixth lesson for use as part of the course.

Respondent Harold Brooks, presiclpnt of the corporate respondent and owner of half of its issued stock, formulates, directs, and conirols the acts and practices of said corporate respondents. The business address of the individual respondent is the same as that of the corporate respondent.

In the course and conduct of their business, and for the purpose of inducing the purchase of their Skinny Legs and Heavy Legs courses respondents advertise in ma.gazines and periodicals of general interstate cireubtion in the United States. The advertisements also appear in circulars, form letters, and othet 11terat111'2 disseminrtted by respondents to pcrson,'J answering said advertisements. ex 3 , 10 , 17 a.nd 18, in evidence in this record, are typical and represent.ative of the advertisements used by respondents in sening their courses. Hespondents intend such advertiscments to convey the impression, and said advertisements do represent, that respondents ' Heavy Legs c.urse provides a.n effective a.ncl reliable means for reducing and reshaping all or any part of the heavy or fat legs of ,vomen, except ;

320 EDERAL TIL;\DE COMMISSION DECIS.IQ:"S Initial Decision GO F.

such heav:y or fat legs as may be due to "abnormal causes. Sillilarly respondents intend that their advertise111cnts for their Skinny Legs course should convey the impression, and the advertisements for that course do represent that such Skinny Legs course provides an effective and reliable means for filling out all or any part of thin or skinny legs of women, except those whose condition is due to '( abnormal" ea uses.

The following representations by respondents in their advertisements are false, misleading and deceptive within the intent and meaning of the Federal Trade COlmnission Act: that the courses are A ,., ell-known authority; are "Tested and proven scientific course Around the clock glamour legs help everything you do Stronger shapely legs help you dance gracefully, work on feet with less fatigue; improve 3 our favorite sport; swim, bowl, play tennis with more ease; find In many cases doctors advise use of this techniq1w. (Emphasis supplied. This Progressive Scientific Method for slenderizing Heavy Legs is based on the knowledge and e;z:perlence of the medical p1.ofession physiotherapists, and famous body contour experts throughout the v:01"d. (Emphasis supplied. All-around glamour legs help women in everything they do. The above statements frolll respondents' aclvertjsements are not true. Respondents lIav e not proffered evidence to prove that they ate true. Respondents' ac1vertis81Ilents ate respondents ' first contact with their prospective customers. Respondents use the name and facsimile signature of "Henry Milchstein, :\LS., Ph. " in a false, misleading and deceptive manner in the courses themselves. Although J\Iilchstein compiled the courses for the respondents six or seven years ago, he was paid for his services in so doing and severed his business connection with the respondents thereafter. Since then l\ilchstein has had Rbsolutely nothing to do with respondents in a business WRY, or with conducting respondents' courses. J\lilchstein has no business interest in respondents, nor associa60n with them (Tr. 560 , 561, 562). The IRst few years, when he WRS in the neighborhood, Mr. Brooks visited Mr. Milchstein s offce. Approximately six times in the )Rst six years lvIilchstein has suggested to the respondents how to reply to questions propounded to respondents by customers. l\lilchstein did not receive any payment for this advice. iiJchstein knew or should have known that the courses were being prolllulgatcd by respondents as though he, J\1ilchstcin, \Were still conclucting them on a personal basis. Yet, J\1ilehstein acquiesced in the misleading and cleeeptive use of his name and facsimile signature in the c.ourses.

MODERX METHODS, I , ETAL. 321 309 Initial Decision Respondent Brooks, Wild actually docs conduct respondents: dayto-day operations is not licensed to practice physiotherapy in New York State, nor in any other State. Respondent Brooks does not have the professional education nor experience which qualifies him to advise women how to improve the a.ppe LI'ance.of :Heavy or Skinny Legs through the methoels described in the courses he sells. Respondents' representation to the purchasers of their courses that they are being personally conducted on a week-by-week basis, by a licensed physi.otherapist is false, misleading and deceptive. The record does not show that there is any licensed physiotherapist on respondents staff, in their employ, or, by contrast, available for consultation by respondents.

Respondents intend to create the impression llld did create the impression in ex I-D and ex 2-D that they are constantly making awards to the students enrolled in their courses who show the greatest improvement. I-Iowever, respondent Brooks testified that such awards had been made on a basis or two pet year since respondents comnlenced making such representati.ons in their advertismnents (Tr. 794). It is significant that one of the eight awards allegedly made by respondents to their pupils was a InUldred dollar " award" which was paid to respondents' witness, Edith Amidore, just "a week or two before she took the witness stlUld in their behalf (Tr. 702). The methods used by the respondents to collect delinquent accounts is also false, misleading and deceptive. ex 24, entitled "Legal Claims Department", does not issue from any such legal claims department. Respondents have agreed in the record to cease and desist from their currently false, misleading a.nd deceptive collection practices.

The greater part of the record consists of the opinion testimony of "experts" called by both parties. These experts gave their professionl opinion as to whether the courses would or would not do that which respondents in their advertising, and in the courses themselves, represent they will do. The hearing examiner heard and observed the witnesses in the hearing 1'00111 and on the witness stand. He observed their demeanor and their manner of answering questions. lie was able to and did fonn an opinion as to their reliability, credibility and knowledge of respondents' courses, their ba,ckground education, and professional experience., and their qurdifications to express an opinion about respondents' courses. The hearing examiner was able to and did form a judgment as to the bias or lack of bias of these witnesses and their personal interest or lack of interest in the outcome of this li6gation. The examiner was further able and 322 FEDERAL TRADE CO \nSSIO DECISIONB Initial Decision 60 F.

did form a judgment as to the weight and probative value of the testimony of each of the experts. Based upon all of the above factors and any and all requisite factors, the hearing examiner finds that respondents' courses here under attack, and in evidence as ex 1 and CX 2, are falsely, misleadingly, and deceptively advertised and represented to the public. Respondents' courses wil not do that which respondents represent they will do. They are false, misleading and deceptive within the intent and meaning of the Federal Trade Commission Act.

The witnesses who testified to this conclusion on behalf of the Federal Trade C0l11nission are:

Dr. Charles S. Wise Professor of Physical ;VIedicine and Rehabilitation at George 'Washington University School of Medicine, IV ashington, D. , and Director, Department of Physical M edicine and Rehabilitation, George IVashington Hospital. Pete1' V. l( aTpovioh Research Professor of Physiology at Springfield College, Springfield, Massachusetts. Dr. Nadine Goyne Associate Professor and Director of Education at the Institute of Physical :\ledicine and Hehabilitation, N ew York University-Bellevue Medical Center. Dr. Coyne graduated from a well-recognized college in a course of physical therapy and had been an instructor in physical therapy, prior to entering the practice of medicine.

Dr. Arthur' 8. AbTwn.son Professor and Chairman of the Depart. ment of Hehabilitation Medicine, Albert Einstein College of Medicine Y shevia University-Medical Director Ithaca College. Dr. Alfred Abel Chief of Physical Medicine and Rehabilitation Service, Bronx Veterans Rehabilitation Hospital, and a member of the staff of Albert Einstein College of Medicine and Ithaca College. The curricula vitae of these witnesses are in the record (CX 25A- 26; 27A-F; 30A-C; 31A-G; 38A-F). All of the Commission expert witnesses were graduates of medical schools, although ;VIr. Karpovich, who received his medical education in Europe, had never been licensed to practice medicine generally in the United States. All of the Commission s expert witnesses are certified as full Diplomates by the American Board of Physical Medicine and Rehabilitation to practice the speciality of physical medicine. Dr. Abramson in addition to being a Diplomate of the above Board, also acts as a member of the Certifying Committee of the Board (Tr. 1134). All of these witnesses appeared to be professional people of the highest type, without any bias, prejudice, or personal interest in the outcome of this litigation. They are qualified by professional edu- MODERN METHODS , INC. , ET AL. 323 309 Initial Decision ca-tion ,and experience to express an authoritative professional opinion about respondents' courses-and did so. They all demonstrated a thorough knowledge of, and acquaintanee with, the course. Several of them had tested some of the exercises prescribed by the courses. The consensus of their opinion testimony is that the courses are "worthless" to accomplish that which respondents represent they will acconlplish. Dr. Coyne pointed out a.actual anatomical inaccuracies in the courses. Inlplicit in the testimony of these witnesses also, but not articulated by any of them, is the potential capacity for harm in permitting persons who are not graduate ::U. s to practice in a field which should be under the direct supervision ancl control of graduate jU. s. Hespondents' sumll print admonition in their courses to ' consult your physician about following these food suggestions" (CX 1-R and CX 2-R) does not substantially alleviate this clangeI' Dr. Coyne s testimony was particularly impressive. In hours of grueling cross-ex:ul1ination by respondents' counsel, Dr. Coyne convinced this examiner that she knows these courses and that her opinion is to be given gren,t weight. i\'Iorcover, Dr. Coyne had actually practiced physiothentpy before she became a practicing i\l. Similarly, Doctors ,Vise, Abramson, and Abel were equally as impressive, objective, and knowledgeable in their answers and opinions about the courses.

Mr. Karpovich was characterized by respondents' witnesses as an outstanding authority in his field. One of the respondents' witnesses Dr. IVassenberg, sought J\fr. Karpovich' s collaboration in a research project but Karpovich declined to become associated with him in the project.

Arra,yed against the imposing panel of Commission expert witnesses were the following witnesses for the respondents: Henry ililchstein who eompiled the . courses which respondents sell, is a registered physiotherapist at 121 'Vest 46th Street, New York New York, and is assistant professor in Physical Podiatry at the M. J. Levi College of Podiatry in N ew York City; chief physiotherapist of the Home and Hospital of the Daughters of Jacob, 167th Street and , asFinley Avenue, the Bronx, New York City. Henry Milchstein the author of respondents' courses and who had been paid originally for writing them, would hardly be expected to disown his own brainchild. His bias and prejudice in favor or respondents was obvious and his interest in preve.nting his courses from being discredited js seh-evident. Although Milchstein expressed mild surprise that his name R,nd facsimile signature were being used in the manner respond- 324 FEDERAL TRADE CO viission DECISIONS Initial Decision 60 F.

ents presently use it-as though Milchstein was and is personally conducting each course with each of respondents' customers on a personal \veek by week basis-the examiner received the impression that Milchstein had no objection to the deception which use of his name and facsimile sigllature made possible.

Thlilchstein s personal interest in the outcome of this litigation Inakes his opinion of doubtful value. He certainly is not objective, and he is not as well qualified as any of the COll11nission witnesses to express an objective professional opinion about the courses. Ha1' ry Boysen runs v" hat he calls a "rehabilitation center" from his residence, 1621Vest 54th Street, ="ew York, N.Y. He testified on direct examination that his educational background consists of the following: "A Bachelor of Science, a degree in physical therapy, a Master of Arts in Hehabilitation, a Master of Science in Basic Medical Science, a Doctor in Psychology, and a degree or rather a certification as a physical director. Counsel supporting the complaint was able to prove in tllls record that most of these claims by Boysen as to his "educational background" are subject to grave doubt and serious question.

Boysen has been completely discredited as a witness in this proceeding, and his testimony should be largely disregarded. 1Vhethcr Boysen violated his oath "to tell the truth, the whole truth, and nothing but the truth" is in some province other than this opinion. Boysen s involvement in "diploma mills" in California, rehabilitation centers in Kew York City, and conspiracies to obtain false medical licenses in the State of Maryland are sufciently spelled out in this record to cast serious doubt on any opinion he may have expressed concerning respondents' courses. His refusal to identify pictures (CX 33, CX 34) of a house in which he had previously testified he had lived in California (which house was also called "Fremont College" and "Sequoia College ) speaks for itself. The court proceedings in the Circuit Court of Baltimore City, Maryland, in "State of Maryland e", rei. V8. Simon Virkutis M. , et al. adjudicated one aspect of the iary land false certification caper and are hI evidence as ex 36. That court opinion names Boysen as one of several persons involved in false certification of persons to practice a found of 111Cdicine in :Maryla,nd. Boysen did not deny this fact on the witness stand. As a matter of fa, , his rationalization of his participabon :in the conspiracy to obta,in fra.udulent medical licenses in the State of l\Iaryland convinced the heating examiner that Boysen s testimony should be completely disregarded. Boysen s testimony added nothing to respondent' s case. His appearance on the witness stand added noth- , MODER , METHODS , IXC. , ET AL. 325 309 Ini tial Decision ing to the professional stature of respondents' panel of witnesses. In view of Boysen s involvement in false certification of applicants for medical licenses in the State of Maryland, his endorsement of respondents' courses detracts from such virtues, if any, ascribed by the other experts to the courses. The hearing examiner finds that Boysen s opinion had linlited probative value in determining whether respondents' courses will, or will not, do what respondents represent they wil do.

Marthann Doolittle (Tr. 956 et seq. conducts a "Relaxation Guidance Center" from her home, 4c East 95th St., Xew York, N. ; has a B.A. Degree from Albertus :i\agnus College in New Haven, took a year of physicalmeclicine at Xew Haven College of Physicall\fedicine, and "took a year of physical therapy training at Columbia Medical and Columbia Teachers College combined. It was a joint course given by the the two institutions. :' She obtained a doctorate of education from Teachers College, Colmnbia 1Jniversity. IHiss Doolittle s Relaxat.ion Guidance Center as described by Iiss Doolittle (Tr. 989 et seq. does not. appear to be the place at which the witness would have had very much experience in testing the effcacy of respondents' Heavy Legs and Skinny Legs courscs so that. she could evaluate them professionally and definitivcly. She demonstrated limited knowledge of, and acquaintance with, respondents ' courses. Her testimony was not unequivocally that respondents' courses will do what respondents represent they will do. The -witness had "used the modalities course of physiotherapy. I have a sinusoidal, galvanic and Farradac machine. . . and I have an nltraviolet and an infrared." (Tr. 901) Dr. Doolitt1e, in response to a question what the IIeavy Legs course and the Skinny Legs course purports to ofter to the people who buy , replied I think it offers a service through planned therapcutic exercises to help a person achieve better muscle tone. (Tr. 999) Hespondents represent that the courses wil do a great deal more than Help a person achieve nlusclc tone." Such misconception by Dr. DoolittJe of respondents' claims for their courscs entitles the Doctor testimony to very little weight in deciding the basic issues posed by the opposing panels of experts.

D,' . Isadore rwoner (Tr. 869 et seq. of Flushing, New York, was one of two M.D.'s who testified for respondents. lie was not certified by the American Board of Physical Medicine. He could not remember the last time he had treated a woman to improve cosn1etically her heavy legs or skinny legs nor the names of such patients (Tr. 896). Dr. Turner s testimony indicated that. the few women he had treatecl 719-603--64-- ).

Initial Decision GO F. for heavy or skinny legs had other medical problems which were pathological rather than cosmetic. He did not testify that respondents' course would do absolutely what they represent it -would do; but opined that diet and exercise combined might under proper COllditions, be used to reduce or build up the measurements of certain portions of the human body. Dr. Turner testified in substance that diet and exercise are the most effective method for reducing heavy legs (Tr. 920, 925, 926). His testimony was of limited value in pl"Ving that for which it was elicited. He did not testify that respondents courses absolutely wil do that which they represent they will do. DO'. E1tgene H. Weissenberg (Tr. 360 et seq. is a physician specializing in physical medicine and rehabilitation. He lives at 1201 Rio Piedras, Pue.rto Rico. 1-10 demonstrated a. sympathetic attitude toward the respondents which the examiner finds prevented him from giving an nubiasedanel objective appraisal of respondents' courses. He obtained his medical education in Vienna, Austria, received his D. in 1918 from the University Sehool of Medicine of Vienna, and is licensed to practice in K ew York and Puerto Rico. In 1944, he migrated to the Uniled States and for thc next six years t.hercltftcr was connected with Columbia Univer.sity and then for five years with the Velerans Administration. In 1955 Dr. IVeissenbel'g moved to Puerto Rico where he was Chief of Physical Medicine and Hehabilitation at the State Insurance Farm, a governmental agency of Puerto Rieo (Tr. 361 et seq. In 1959, Dr. Weissenberg left the service but maintained his affliation with the University School of Medicine in Puerto Rico where he had the position of Clinical Professor of Physical fedicine and Rehabilitation. The testimony of Dr. Weissenberg, even as that of Dr. Turner, was not unequivocally to the effect that respondents' courses will do that which respondents represent they wil do. It is not dear in this record whether Dr. \Veissenberg came all the way from his practice in Puerto Rico to 1: ew York City for tbe sole purpose of testifying on behalf of respondents. However Dr. \Veissenberg acknowledged in his testimony the eminence of Peter Karpovich (one of the Commission s witnesses) in this field (Tr. 395). Dr. \Veissenberg s attempt. to collaborate with Dr. Karpovich on a research project, because of the high esteem in ,which \Yeissenberg held Karpovieh' s professional qualifications and scientific opinion, was refuscd by Karpovich (Tr. 391). Dr. IVeissenberg s demeanor on the stand convinced the examiner that he ,,,as not giving an unbiased opinion nor was he being objective. He did not display the familiarity with respondents' courses that Commission experts had. IIis opinion as neither as impressiye as, nor as knowledgeable as, the opinions . . . . .

MODERN :MTHODS ET AL. 327 309 Initial Decision of any or all of the Commission s expert witnesses. Moreover, Dr. Weissenberg s opinion, even as that of Dr. Turner, was not unequivocally to the effect that respondents' courses wi1 do that which respondents represent they wiJ do. Dr. 1Veissenberg s testimony on crossexamination (Tr. 408), demonstrated his very limited knowledge of the courses. His opinion, if it 'were the only opinion in the record would not prove respondents' contentions.

The examiner finds that the opinion testimony adduced on behalf of the lCederal Trade Commission is mora trustworthy, dependable reliable and credible than the opinion testimony adduced on behalf of the respondents. Based upon the professional opinion testimony of the experts who testified on behaH of the Commission, the examiner finds as a fact that respondents' courses will not do that which respondents represent they wid do, and that respondents' representations to prospective customers in advertisements and in the courses that the courses will make heavy J egs and skinny legs more shapely and alluring were and are false, nlisleacling, a.nd deceptive \within the intent and meaning of the Federal Trade Commission Act. In their advertisements and in the courses themselves, respondents falsely and deceptively represent the terms and conditions under which their hand vibrator (CX 23), the Tone-up Lotion (CX 21), and Limber-up Lotion (CX 22) are dispensed. These are not furnished "freon to respondents' customers as represented by respondents; they are sent to customers who have paid in a desi,6YJlatecl minimmn sum of money. Their monetary value is overstated by respondents in both the advertisements and in the courses themselves. The use of these devices wiJ not reduce heavy legs nor build up skinny legs. however, by making these contrivances a part of their courses, respondents deceive their customers concerning the amount of beneficial results, if any, to be obtained from using them. DISC-cSSION Respondents' position may be stated by quoting from the brief accompanying their proposed findings:

In the instant case there is no proof that there is a trade which bas been affected by the acts or practices of respondents EEl'. p. 19) (Therefore,) the proceeding is not in the public interest (Er. p. 20) when evidence shows that no one was deceived, there is a lack of public interest. IBr. p. 21). In other words, before there can be an act or practice, there must be someone who is capable of being taken in by tbe act or practice to their detrirnent. Throughout this proceeding, respondents' counsel has erroneously urged the above common law concept of fraud and deceit as the yard- (( y, 328 FEDERAL T'TRADE COM ISSIO DECISIONS, Initial Decision 60 F.

stick for determining whether there has been a violation of Section 5 of the Federal Trade COillnission Act. Respondents counsel argues that in the absence of a showing that there has been a specific injury to a specific member or segment of the public, there can be no public injury, and therefore, no public interest in this proceeding. Respondents' coullsel further argues that, because a la.rge part of the testimony in this record is the opinion testimony of experts, this case involves a constitutional issue of denial of freedom of speech, or of the press. This argument demonstrates such misconception of the callatitutjonal guarantees as to require no lengthy discussion. The constitutional provisions cited by respondents were placed in the Constitution for protection of the individual.l's rights. They were not intended to nor do they vouchsafe into the respondents, or anyone else, the right to bilk the public by deceptive trade practices. Respondents further state (Br. p. 20), "Public interest must be specific and substantial citing Henry Brock 00. v. Federal Trade Oommission 261 F. 2d 725 (reversed on other grounds 636 U.S. 166). The answer to respondents no injury to competition" argument is in adjudicated cases which were decided after the '\Vheeler-Lea Amendment of 1938 broadcned the concept of dceeption which the Federal Trade Commission is responsible for policing. Certain sentences culled from those decisions state what the examiner understands the present state of the law to be. It is in the public interest to prevent the sales of commodities by the use of false and Inisleading statements and representations. Capacity to deceive and not actual deception is the criteria by which practices are tested under the Federal Trade Commission Act! To tell less than the whole truth is a well-known n1ethod of deception; and he who deceives by resorting to such method cannot excuse the deception by relying upon the truthfulness per se of the partial truth by which it has been accomplished. A statement may be deceptive even if the words may be literally or technically construed so as to not constitute a misrepresentation. . . The buying public does not weigh each ,vord in an advertisement or misrepresentation. It is important to ascertain the il1pression that is likely to be 2 For discussions of the constitutionality of the l ederal Trade Commission Act, see Sears, Roebuck dO Co. v. FTO, 258 F. 307; FTC v. F. A. Motocci 87 F. ;jGl; Nationa, IIarness Mfrs. Assn. v. FTO 268 F. 70 T. G. H!lTst .1 Son FTO 268 F. 874; FTC A. McLean Son 84 F. 2d 910. The Sears case 11115 been cited with approval on the question of constitutionality in the following' cases: State of 01r'zahorna v. 153 F. 280 (C. A. 10th 1946) ;Scientijic Mfg. 00. v. P'1'O, 124 F. 2d 640; FTO Y. Matocci, supra F'1' v. Balme 23 F, 2d 618; Royal Baking Powder case, 281 b'. 745. Parke, .dllstin Lipscomb v. FTO 142 F. 2d 437, citing L. E. Mayer Co. v. FTO, 97 2d 365, 367.

4 Goodman v. FTC, 244 F. 2d 584, 604 (C. A. 9th 1957). 5 P. Loriiard Co. v. FTO, 186 F. 2d 52, 58 (C.A. 4th 1950). ;yroDER1' METHODS, INC. , ET AL. 329 309 Inhinl Decision created upon the prospective purchaser." fj Advertisements are not to be judged by their effect upon the scientific or legal mind, which wi1 dissect and analyze each phrase, but rather by their effect upon the average member of the publjc who more likely wi1 be influenced by the impression gleaned from a first glance. If respondents' deceptive advertising \\e1'e corrected so as to abide by the legal rules stated above, this would remove only one of the sources of respondents' deception. There is an even more sihTllificant and deeply rooted deception in the courses themselves. The deception in the courses themselves cannot be cured unless the courses are completely rewritten to conform with reliable, accepted, medical, professional opinion, and so as not to overstate, as they now do, what they will accomplish. Respondents should cease forthwith to represent that "Henry Milchstein, M.S. Ph. T" actually conducts the courses as " your instructor " because this is not true. It is unnecessa.ry to make ' a finding whether proper diet and proper exercise would substantially reduce and reshape women s heavy legs and build up and make more shapely women s skinny legs. Qualified professional expert witnesses have stated as their opinion that the epecific courses (CX land CX 2), presently being sold by respondents, will not do that which respondents represent they will do. order, therefore, for respondents to cure the deception presently in the courses, respondents must either eliminate the deceptive claims presently in the courses, or rcwrite the courses so that they will accomplish what respondents claim they will do.

Respondents ' great reliance upon s Manufaoturinq Company, et al. v. FTO 287 F. 2d 831 (GA. 9th 1961) is misplaced. The Evis if:sues do not coincide with the issues in this case. In Evis the court emphasized the facts that (a) the Commission s expert witnesses ignored the manufacturer s instrutions when installing Evis water conditioners, and (b) Commission counsel apparently coneeded that out of some 100 000 installations, possibly 3 000 or only 3 percent of the users would testify to unsatisfactory results. In view of the fact therefore, that Commission counsel had indirectly conceded that the ,ya.ter conditioner did "What it was represented as doing, in 97 percent of the cases, the Comlnission had erred in ignoring the expert testimony in the record to the effect that the conditioner would perform as reprefentec1. Respondents in this proceeding proil'erecl the testimony of about forty hand-picked customers (which was refused-see footnote supra) even though they had been selling approximately '-) 000 f(r;,wojtijS v. ltc 237 F. 2d 654 CC).t. den. 352 U. S. 1025. Wa.rd Labol' otaries, Inc' et al. v. PTC 276 F. 2d U52, 954 (C.A. 20 19(0). ) ; . . .

330 FEDERAL TRADE COMMISSION DECISIONS, Initial Decision 60 F.

courses per year for about six years. As the court said in Erickson (footnote 1 s"pra) Further, it is sound to say that the fact that petitioner had satisfied customers is Dot a defense to Commission action for deceptive practices. The opinion testimony in this record has been evaluated by application of accepted criteria for judging opinion testimony (i. , interest in the outcome, bias, prejudice, demeanor on the stand, professional tI'ain iug and experience, and other elements stated u,pra page 321 et seq. Rather than equating the issues in this case with Em:,' the issues in this case should be equated with: Aggressive Medical oompany, C. 1111 (a germicidal destroyer, contraceptive tablets for preventing venereal disease) ; Ralcuiam 00. 316 U. S. 149, 24 F. C. 475 (Marmola reducing tablets); Holly"oood Magic Garment Oompany, 36 F. C. 110 (a rubberi"cd garment to reduce weight by inducing excessive perspiration); David V. B"sh 14 F. C. 90 (a weight redueing diet). In Associated Laboratories, Inc. 37 F. C. 263, order aff'd 150 F. 2d 629 , respondents made claims for their Kelp- Malt tablets similar to the claims made by t.he respondents in this proceeding, i. , that the tablets would produce "a well-proportioned body':' shapeliness of form or figure; a "shapely" figure; restoring health strength and vigor to those who are "tired" and "rlUl dm-vn; therapeutic value in cases of "acid stomach gas " or "indigestion Oharles of the Ritz D'istrib"ting Oorporation v. FTO (C.A. 2d 1944), 143 F. 2el 676 (involved foundation eream for makeup) ; Feil v. FTO 285 F. 2d 879 (C.A. 9th 1960) (involved a device to prevent bed wetting) ; Erickson v. FTO 272 F. 2d 318 (1959) (hair and scalp preparations); Bristol-Myers 00. v. FTO 185 F. 2d 58 (1950) (the use of Ipana toothpaste to prevent "pink tooth brush" J. E. Todd, Inc. FTO 145 F. 2d 858 (1944) (a product which had value in the treatment of arthritis, neuritis, rheumatism and similar diseases); Irwin FTO 143 F. 2d 316 (1944), involving the sale of "Gordon s Detoxifier to cleanse the intestines.

The land-mark Raladam decisions involving the sale of a weightreducing preparation "Marmola" were responsible for the Congress broadening the concept of deception prohibited by the Federal Trade Commission Act to "capacity to deceive and not actual deception is the criteria by which practices are tested under the Federal Trade Commission Act. Goodman v. FTO, s"pra. Respondents' counsel has made much of the fact that evidence adduced in later hearings on behalf of counsel supporting the complaint was not proper rebuttal evidence. Respondents, for insta,nce objected to Commission counsel being aiTorded an opportunity to , , MODERN METHODS , H1;'" ) ET AL. 331 309 Initial Decision elicit, as rebuttal, the true facts concerning the training, background experience, and activity of Harry Boysen. This Commission evidence (Tr. 1304-1399) constituted proper rebuttal testimony. Until respondents had put Boysen on the stand as one of their experts, Commission counsel could not know what Boysen s testimony would be. Commission counsel should be highly commended for placing in this record the true facts concerning Boysen. This he could not have done except on rebuttal.

The Federal Trade Commission Act and the Commission s practices and procedures do not require Commission counsel to anticipate through clairvoyance respondents' evidence, and incorporate rebutting evidence in the Comnlission s case in chief. Ilespondents' technical position about the burden of proof confuses the legal distinction between the burden of proof and the burden of going forward. The burden of going fonmrd will always devolve upon Commission counsel, but the burden of proof is upon the party who asserts a particular proposition. In this case respondents sought to prove Boyscn a qualified expert. They failed in their burden of proof.

:l10reov8r, Federal Trade Commission proceedings are not contests of wits nor technical legal exercises. The public interest must be served and protected. To that end the truth must be ascertained and made a part of the hearing record. Due process of 10.",,' is as much a right of those who represent the public interest as it is of the private litigant. Counsel supporting the complaint in this case had the initial obligation of going forward. Having once established t.he essential allegations of the complaint by reliable, probative and relevant evidence, the burden then shifted to these respondents.' After the close of respondents' evidence, Commission counsel were and are entitled to rebut evidence adduced on behalf of respondents, even as respondents ,vero and are privileged to contradict as much of the Commission s evidence as the facts will establish. Respondents' heavy reliance upon Scientific Manufacturing Comand upon Evis Manufactur-pany, supra in their brief (p. 18 et seq. ing Oompany, supra in their oral argument is misplaced. The examiner s ana,Jysis of the Evis decision in this portion of this opinion has differentiated Evis in many respects from the instant proceeding. The examiner s finding that the expert opinion testimony preponders The ideal toward which administrative practice is painted is that Its greater flexibility will make the ascertainment of the truth pas1er surer, and speedier. See Hearing Examiner s Ruling of )'farch 23, 19GO, denying respondent's motion to. dismiss at close of case-in-chief. See 81so Consolidated Foods Corp. Docl, t Ko. 7000. Dec. of March 4, 1960.

332 FEDERAL TRADE CO::MISSION DECTSIOKS Initial Decision GO :E.

ates heavily in favor of the COllllllission s witnesses in this case would be sufficient, standing alone, to make Ev,ts inapplicable. Scientific .Hanufacturing Company sold pamphlets in interstate commerce which postulated the theory that foods prepared, cooked or stored in aluminum utensils became toxic or poisonous. The nub of this decision is in the last paragraph reading: . . . Surely Congress did not intend to authorize the Federal Trade Commission to foreclose expression of honest opinion in the course of one business of voicinfl opinion. The same opinion, however, may become material to the jurisdiction of the Federal Trade Commission and enjoinable by it if, wanting in proof or basis in fact. it is utilzed in the trade to mislead or deceive the public or to harm a competitor. . .. (Emphasis supplied. The obvious distinction between Scientific Manufacturing and the instant case is the fact that respondents here are not in the "business of voicing opinion:' but are selling home study courses at approximately $30 per course. ",Were respondents' interpretation of the phrase " business of voicing opinion" adopted by any responsible authority, Congress woulcllose all of its control over trade regulation in the antideceptive field because it would be very simple for any respondent charged with deceptive practices to cla.im, a.s respondents claim here that they are l1lerely in the "business of voicing opinion. " :Nothing could be further from the facts in this case. Respondents are in the business of making money.

In the matter of Pioneers, Inc. , et 01. 52 F. C. 1351, in which a diffcult problem was presented inyolving the weight to be given to 80called expert testimony: the complaint was dismissed by the hearing examiner, and this was affrmed by the Commission: . . . In view of the conflict in the scientific evidence, the hearing examiner deemed the user evidence attesting to product merit to be particularly significant, and he, accordingly, held the complaint's allegations to be unsustained by the greater weight of the evidence. Recognizing that the burden of proof is on the proponent of the complaint, we regard the hearing examiner s order of dismissal as sound and correct in the circumstances of this case. . . . In the insta.nt proceeding this hearing examiner has found that the "greater weight of the evidence" adduced as opinion testimony does sustain the allegations of the complaint. Respondents tdvertisements for the courses, as ivell as the courses themselves, are false, misleading and deceptive in many ways. The first contact that respondents have \with their custoulers is by means of their deceptive advertisements. ",Vhere the first contact is secured by deception, it is not subsequently cmed by making a full disclosure ofthe facts.

IG Carter Products, Inc. v. FTC, 186 F. 2d 821, 824. MODERN METHODS, INC. , ET AL. 333 309 Initial Decision In this case, the deceptions in the advertisements are of a separate and distinct nature from those in the courses themselves. ,Without reference to the deceptions in the advertisements, the representations in the courses are deceptive, inter alia, in that they are not conducted on a personal "\veek-by-week basis by "llenry IiJchstein I.S. Ph. as "your instructor llor by any other licensed physiotherapist. They will not according to preponderant, creditable, probative, reliable, medical testimony, do what respondents claim they will do for Heavy Legs Bulging hips Flabby thighs bulging knees heavy calves heavy ankles feet and arches (See cover of ex 1). Nor will they do what respondents represent they will do for Skillny legs Straight hips Sera \vny thighs hony knees thin calves and thin ankles feet and arches (See cover of ex 2).

Respondents argue that Iilchstcin is the only expert witness, on either side, entitled to express a binding opinion about their cour because he had actually used them. The nns"\er to this argument in addition to the examiner s finding of Iilchstein s bias, prejudice interest in the outcome of the litigation, and acquie cence in the deceptive use of his nRnlC and facsinlilc signature, is in la.nguage from Bristol-l1iye,.s 00. v. FTO 185 F. 2d58, 62: . . Opinion evidence based on the, general medical ::md pharmacological kno"\vledge of qualified experts has often been held to constitute substantial evidence, even if the experts have had no personal experience with the product. Goodwin v. U. , G Cil' , 2 1". 2d 200, 201; Dr. \V. B. Caldwell lnc.. Y. F. 7 Cir., 111 F. 2d 889 , 891; and this has been clone even where witnesses who had personally observed the effects of the product testified to the contrary. (Citing cases) Respondents argue, fmally, (a) even if the courses won t do any good, at least they won t do a.ny harm; a.nd (b) if their customers are not satisfied, they can get their money back at the end of the course-so Such pleas in the nature of "confes ion and avoidance 334 FEDERAL TRADE COM:3lission DECIS.IO Initial Decision 601!"' 'l. again completely Iniscollceives the congressional intent find purpose of the Federal Trade Commission Act and the vVheeler-Lea Amendment thereto.

This record shows that when respondents 'were challenged by the Post Offce Department in 1952 for the manner in which they ,were then advertising and selling their courses which arc in evidence (CX 19 and CX 20), respondents changed their operations from that typified by CX 19 and CX 20 to that now typified by CX 1 and CX 2 CX 21, CX 22, and CX23. The need, therefore, for a broad and allinclusive cease and desist order is apparent from the record. Based upon the findings of fact previously set forth and the law as applied to those fads, the hearing examiner makes the following: CONCLUSIONS 1. The Federal Trade Commission has jurisdiction over the parties and over the subject matter of this proceeding; and this proceeding is in the public interest. The complaint filed herein states a good cause of action against respondents, and counsel supporting the complaint has proven the essential and material allegations thereof by a preponderance of reliable, relevant, probative and substantial evidence in the record. Respondents are engaged in commerce, as "commerce" is defined in the Federal Trade Commission Act. 2. In a.advertising, offering for sale, sening and disselninating in interstate commerce their 12 vVeek Scientific Home Course to slenderize heavy legs" and their 12 Week Scientific Home Course to add .lIuring curves to skinny legs " respondents engage in false, misleading and deceptive acts, practices and representations which are in contravention of and constitute a violation of the Federal Trade Commission -, , as amended.

3. The aforementioned false, misleading and deceptive ads, practices and representations of respondents in sening their courses for Heavy Legs and Skinny Legs should, in the public interest, be forthwith prohibited as provided in and by the Federal Trade Commission Act, and the decisions thereunder. Therefore It is o1'dered That Modern Methods, Inc., a corporation, and its offcers, and I-Iarold Brooks, inc1ivichml1y and as an offcer of said corporation, and their agents, representatives and employees, directly or through any corporate or other device: I. In conne,ction with the offering for sflJe, sale or c1istribution of the COllrses of instruction entitled "12 ,VEEK Scientific 1-10me Course to slenderize HEAVY LEGS" and " 12 'WEEK Scientific Home Course to add alluring curves to SKIN),Y LEGS " or any other courses of lvl0DBR lvIETHODS, INC. , ET AL. 335 308 Initial Decision mstruction or writings having to do with reducing, building up, reshaping or other\vise changing the contour of women s legs, which contain the same or substantially the same subject matter, or approach to the problem, in commerce, as "commerce" is defu1ed in the Federal Trade Commission Aet, do forthwith cease and desist from representing, directly or by implication that said courses and writings: A. Provide an effective or reliable means to reduce, reshape, or fill out all or any part of the legs of women, or otherwise change the eize, shape or contour of all or any part of women s legs; B. Provide an effective or reliable means to make all or any part of the legs of women substantially more shapely or alluring than they are before the courses or writings are used; C. Are by a well-known authority;

D. Are tested and proven scientific courses; E. 1Vill provide around the clock glamour legs which help everything a woman does;

F. Wil improve the ability of the purehasers thereof to swim dance, play tennis or bowl;

G. Are predicated on techniques which are recommended by doctors; 1-1. Are based upon the knowledge and experience of the medienl profession;

1. Are based upon the knowledge and experience of physiotherapists and body contour experts throughout the world; J. Are being conducted by a licensed physiotherapist. II. In connection with the offering for sale, sale or distribution of any course of inst.ruction or other article of merchandise in commerce, as "commerce" is defined in the Federal Trade Commission Act, do forthwith cease and desist from:

A. Representing that any book containing any specific information will be furnished free or for any amount or consideration unless such book containing such information is in fact so furnished; B. Representing that any specific article of merchandise will be furnished free or for any amount of col1side-ration unless such specific article is in fact &0 furnished;

C. 1Jsing the word "free" or any other word or words of similar jrnport or meaning, in advertising or in other offers to the public to desjgnatc or describe any massager, lotion, formula., book or other article of Inercha,ndise when an of the conditions, obligations or other prerequisites to the receipt and ret,ention of the "free" article of mereha,nelise are not clearly and conspicuously explained or set forth inunediat,e conjunction with such representation; 336 FEDERAL TRADE COMMISSION DEmI'IONI' Opinion 60 F.

D. Representing, directly or by implication, that the regular or usual price of any of their products is any amount in excess of the price at which the respondents have usually and customarily sold such products in the recent and regular course of their business; E. R,representing, through the use of a trade name or otherwise that respondents, or either of them, are a separate or independent organization or person to whom accounts have been turned over by respondents, or either of them, for collection; F. Representing that any courses or writings sold by respondents will accomplish results for the user of said courses or i1Titi11gs II which in fact they wil not accomplish.

OPINION OF THE CO:\flrISSION By ICEHN 007rvrnissioneT:

The complaint in this matter charges respondents with violation of the Federal Trade Commission Act. The hearing examiner in the initial decision held that the allegations of the complaint were supported by the record a.nd ordered respondents to cease and desi::t from the practices found to be unlawful. Hespondcnts and cOlUlsel supporting the complaint have appealed from the initial decision. The main thrust of the complaint is that respondents have 111isrepresented their correspondence courses as providing an effective or reliable merms for women with heavy legs and women ,,,ith thin legs, except when due to abnormal causes, to reshape all or any part of their legs to make them more shapely and alluring. In addition, the complaint alleges that respondents hf1ve falsely rcpresenteel thflt a free book is sent to persons responding to their advertisements and that a massage kit will be given free to women enrolling in the courses. Finally, the complaint attacks as deceptive the use of certain collection forms on the ground that such collection notices (1re not sent out by a separate or independent collection agency as the forms imply.

The argument which respondents advance on this appeal may be summarized as follows: namely, that there is no substantial evidence. in the record to establish the allegations of the complaint, that the Commission lacks jurisdiction over the parties and subject matter and that respondents have been denied clue process of law and the proceedings are not in accordance with the ..'lc1ministrative Procedure Act.

Respondents' contention that the Commission Jacks jurisdiction over the parties and the subject matter of these proceedings obviously is without merit. :Moreover, the subject matter here before us un- MODERlT METHODS INC. ET AL. 337 309 Opinion doubtedly is clothed with substantial public interest. A commercial enterprise dedicated to remolding the contours of the female form especially the lower appendages thereto, into shapely and aJJuring contours deserves governmental encouragement, not reprimand. But even in this worthy field of endeavor traditional rules of truth and veracity concerning the course of treatments .offered by respondents must be maintained. Neither fat nor skinny customers should be hoodwinked into subscribing for respondents' courses on the basis of fa.lse representations; for failure of performance of respondents courses as represented could only serve to increase the burden of the cross they bear.

Respondents, in effect, argue that there is no substantial evidence to support the order entered by the hearing examiner because the findings of the initial decision and order are based solely on the opinion evidence of the Comlnission experts, which is contradicted by the testimony of respondents' experts as well as that of two user "\witnesses.

Respondents' contentioll that expert medical opinion has no relevance to the issues presented by this case is without merit.' It suf- fices to say that there is ample support in the record for a holding that the effcacy of the exercises prescribed by respondents' courses involves medical a,nd physiological questions and is not limited to a realm of corporal mechanics as respondents apparently argue. Obviously, the Conlmission, in order to resolve the issues before it in this case, must consider expert 1nedical opinion as well tS such other evidence which is relevant and probative.

Opinion evidence based on general medical and pharrnncological knowledge constitutes substantial evidence. Erickson Hair and Scalp Specialists 1'. Federal Trade C01lvmission. 272 F. 2d 318 (7th Cir. 1959), oert. denied 362 U.S. 940 (1960). Conflicts between the opinion evidence of Commission experts, respondents' experts and the testimony of customers a.re questions of fact to be resolved by the Comnlission. 111 a1trice J. Feil, et al. v. Federal Trade 001n11ussion 285 F. 2d 879 (9th Cir. 1960). However, in view of the disposition of this case on procedural grounds discussed below, we do not reach the question of whether, jn fact, counsel supporting the complaint has sustained the burden of proof by reliable prob"tive and substantial evidence.

1 "Actuallv, tbe issue is not within the realm of medical espcrtise, but is one of the applicn,tion f fUIJction aIJd motion against resistive forces to the female extremities insofnr as the special exercises are concerned," Respondents' Appeal Brief. p. 24. 338 FEDERAL . TRADE CO:\!LMISSIO DECISIOKS Opinion 60I"

'IVe now turn to respondents' argllment that they were denied due process of la,w and that the proceedings below were not in accordance with the Administrative Procedure Act.

The allegations on this point requiring the most serious consideration were to the effect that respondents were denied the opportunity to present a full and complete defenso to the charges made against them. In support of such contention inter alia the respondents claim substantial error or abuse of discretion in the refusal oT the hearing examiner to reopen the case to permit respondents to present surrebuttal evidence to the rebuttal evidence offered by counsel supporting the complai11t. Specifically, respondents requested that Commission experts, Doctors Coyne and I\:arpovich, be recalled Tor the purpose of cross-examination on prior statements with respect to the effect of exercise on the contours of muscles, allegedly contradicting their testimony in this proceeding. In the case of Dr, Karpovich the subject of the cross-examination was to be statements in a book previously written by the witness. Doctor Coyne, on the other hand was to be cross-examined on her testimony in another proceeding, Dama" Products, Inc. (D. 7769), if the hearing examiner declined to take offcial notice of certain passages of the witness' testimony in that proceeding. Finally, respondents requested permission to recall their witness, Henry Milchstein, to rebut criticism by Dr, Coyne of the courses of which he was author.

The hearing exa.miner did not err by refusing to reopen the case t.o permit the recall of Doctors Coyne or Karpovich. The determination of whether a witness should be recalled for impcaclunent rests within the realm of the hearing examiner s sound discretion, and there is no showing under the circumstances that the hearing examiner abused that discretion in refusing to permit respondents to recall Doctors Coyne and Karpovich. By the same token, respondents claim that there was an abuse of discretion in permitting counsel supporting the complaint to recall respondents' witness Royson for further cross-examination is without merit. The hea,ring examiner, however, did commit error in re.fusing to permit respondents to recall Ir. Jlilchstein for the purpose of surrebutting Dr. Coyne s criticism of respondents' courses. This offer of testimony, not opposed by counsel supporting the complaint, was 2 On a review of respondents' motion to reopen the record of !II arch 7 , 1961, it is apparent that the statements of Dr. Coyne in Damar Products, Inc. (D. 7769), did not, in fact, contradict the witness' testimony in this proceeding. With respect to Dr. Karpo'\ich' book, although there is a conflct between the parties on this point, the hearing examiner could have reasonably concluded that this book was a'VaiJable to the respondents at the time the witness was on the str\lhl.

1vODER T METHODS , INC. , E'I' AL. 339 309 Opinion related, in some degree, to the merits of the case and should have been permitted. The hearing examiner had properly given counsel supporting the complaint some - latitude in presenting rebuttal evidence and, in all fairness, should have afforded respondents the same opportunity on surrebuttal. Questions relating to the precise limits of rebuttal testimony are matters resting largely within the discretion of the Commission, which has ultimate responsibility for conducting the proceeding and determining its merits, and the hearing examiner rulings in this area should not be unduly restrictive. Foster-ililburn 00., et al. 51 F. C. 369, 371 (1954).

Respondents also argue that the proceedings were unfair on the ground that the hearing examiner indicated prejudgment of the case against respondents and that the hearings were conducted in a manner prejudicial to respondents' rights.

In his ruling of October 21 , 19nO, the hearing eXflminer gratuitously castigated certain of respondents' exhibits, at a time when this issue was moot, since he had already rejected the evidence in a previous hearing. lie also issued this ruling before respondents' memorandum of authorities was due. These circumstances, irrespective of his actual state of mind at the time, indicate that the exaJniner, in issuing the ruling, did not preserve that appeara.nce of impartiality requisite to a fair heating.

Respondents, in addition, allege, in effect, that the hearing examiner by his interruptions of counsel as well as frequent interventions in tile examination and cross-examination of witnesses, abandoned the role of trier-of-fact and aided COlUlsel supporting the complaint in presenting his case. "\Ve do not find that the hearing examiner aided or intended to aid, counsel supporting the complaint by his participation in the examination of witnesses or by his comments during the proceeding. In fact, the record evidences instances of objections on the part of both sides to t.he hearing examiner s questions directed to witnesses, a,nel on one occasion, both respondents counsel and counsel supporting the complaint objected to the same question. The interjection of the hearing examiner in this proceeding wa,s probably helpful to neither side. KevcrtheJess, while the hearing examiner may examine and cross-examine witnesses to insure that the facts are developed fully and with clarity, he should not pursue this course to the point "where either or both sides are impeded in the presentation of their case by needless interruption and interference. 8 The fact that respondents' attorney was subsequently permitted to file bls memorandum and argue the matter does not cure the procedural defect when It Is apparent that the hearing examiner had already finally determined the matter at the time he issued his written ruling.

340 FEDERAL TRADE COM.'dI&SION DECI&IONS Opinion GO F,'l.

Although we will ordinarily accept the hearing examiner s evaluation of the witnesses who have appeared before him, certain innuendoes and derogatory inferences in the initial decision reflecting on the credibility or bias of respondents' medical expert, Dr. IVeissenbcrg, are not warranted by the record.

Further, the hearing examiner in the initial decision erroneously stated that all of the Commission experts were certified as full Diplomates of the American Board of Physical Medicine and Hehabilitation. lie emphnsized the significance he attached to this distinction with the COmlnent that one of the C0l11111ission experts was also a member of the Certifying Committee of the Board. Subsequently, he takes pains to note that one of the two medical 'witnesses presenteel by respondents, a Dr. Turner, was not certified by the Board. In fact the record does not show t.hat Dr. I\:arpovich, one of the two Commission experts presented in the course of the case in chief, "\yas so certified and counsel in support of the complaint expressly disc1aims any such qualification of Dr. ICarpovich in his proposed findings. Thus, the hearing examiner s insistence on the fact that all of the Comnlission experts \were certified was not only at variance with the record but with the proposed fu1dings of the attorney in support of tho complaint. This gratuitous misstatement as to the qualification of one of the Comnlission expert ,witnesses on the part of the hearing examiner, unsupported by the record and disclaimed even by counsel supporting the complaint, raises a grave question as to the hearing examiner s impartiality.

The charitable inference is that this mistake in the initial decision may have resulted from a simple typographical error in incorponlting the applicable proposed finding of cOllnsel supporting the complaint on this point in the initial decision. Nevertheless, such carelessness involving a factor to which the hearing examiner evidently attached considerable importance in his evaluation of the witnesses lends support to the conclusion that the proceedings in this matter 111ay not have been conducted \With that degree of fairness and thoroughness \which should be characteristic of all Federal Trade Commission proceedings.

On a review of the record as a whole we have deterlnined that respondents were not aiIorded a fair hearing below. The hearing examiner erred in curtailing respondents' presentation of evidence and his indulgence in gratuitous and unguarded comment in the course of hearings and in the initial decision have reflected on his impartiality.

MODERX ETHODS) INC. ) ET' AL. 341 309 Order As the Xinth Circuit a.ptly stated in an -analogolls situation: If judicial perfection calmot be obtained, at least the observation of the forms of fairness often makes it easier to pull out of the quicksand of error. James H. Sewell Y. Federa.l Tra.de Commission 240 F. 2d 228, 233 (9th Cir. 195G), rev don other grollnds353 U. S. 969 (1957). \Ve conclude, therefore, that the conlpla-int in this proceeding should be dismissed. The COlllJnission unquestionably has the power to remand this 11latter to a hearing eXalTIiner for further evidence in order to provide an adequate basis for review. However, such a proceeding is costly, time consuming and, to some extent, harassing to respondents. The record is devoid of the testimony of dissatisfied customer.rs chiming deception on the part 'Of respondents. Even though proof of actual deception is not prerequisite to a finding of violation, taking into consideration an the cirCwllstances disclosed by this record we are satisfied that the public interest will be adequately protected by continuing a. close scrutiny of respondents' operations. Such disposition of the case makes it unnecessary to rule specifically on each of the points raised by respondents and counsel supporting the complaint in their appmtl from the hearing examiner s initial decision.

OHDEH. DI5?IISSIXG CO::IPLAIXT This matter having been hea.rd by the Commission upon t.he appeals of respondents and cOlUlsel supporting the complaint and upon briefs and oral argument in support thereof and in opposition to sa,id appeals; and The Commission having duly considered said a.appeals and the record herein and having determined, for the reasons stated in the accompanying opinion: that the complaint should be dismissed. , such disposition of this Cllse rendering it Imneces.sary to rule. speciiieally on each of the points nLisecl by respondents and cOlUlscl supporting the complaint in their appeals:

1 t 'i.s ordered That the conlplaint herein be, and it hereby is dismissed.

719-6(13--0';- 342 FEDERAL TRADE COMl\ISSIOX DECTSrOl\' Complaint GO P,