Alpin, Inc., doing business as Cincinnati Food Service & Appliance Company

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IN THE MATTER OF ALPI~, INC., DOING BUSINESS AS CIKCINXATI FOOD SERVICE & APPLIAKCE COMPA~Y ET AL.

CONSENT ORDER, ETC" IK REGARD TO THE ALLEGED VIOLATION OF THE :FEDERAL TRADE CO Il\nSSION ACT Docket C-18S. Complaint, Jttly 1962-Decision, July, 1962 Consent order requiring Cincinnati sellers of freezers and food freezer plans to the public to cease using false pricing, savings, and guarantee claims and other misrepresentations in advertising, including radio and television broadcasts, to sell their freezers and freezer food plans, as in the order below more fully set out.

COMPLAINT Pursuant to the provisions of the Federal Trade Commission Act and hy virtue of the authority vested in it by said Act, the Federal Trade Commission, having reason to believe that Alpin, Inc. , a corporation trading and doing business as Cincinnati Food Service & Applia.nce Company, and :1\i1ton pjnsky and Daniel J. Allen, individually and as officers of said corporation, hereinafter referred to as respondents, ha YB violated the provisions of said Act, and it appearing to the Commission that a proceeding by it jn respect thereof ,"ould be in the public interest hereby issues its complaint, stating its charges in that respect as follows:

Complaint 61 F.

PARAGRAPH 1. Respondent Alpin, Inc., trading and doing business as Cincinnati Food Service & Appliance Company, is a corporation organized, existing and doing business under and by virtue of the laws of the State of Ohio, with its principal oilee and place of business located at 3612 Montgomery Hoad in the city of Cincinnati, State of Ohio.

Hespondcnts :\lilton Pinsky and Daniel .J. Allen are offcers of th" corporate respondent. They formulate, direct and control the acts and practices of the corporate respondent, including the act and practices hereilUdter set forth. Their address is the same as that of the corporate respondent.

PAR 2. Respondents arc nmv and for some time last past have ben engaged in the advertising, offering for sale, sale and distribution of freezers, food and food freezer plans to the public. PAR. 3. In the course and conduct of their business, respondents now cause, and for some time last past have caused, free,zers and food, when sold, to be shipped from the.ir place of business in the State of Ohio to purchasers thereof 10c.atNl in various other state the United States, and mainta. , and nt all time.s J1wntioned herein have maintained, a, substantial course of trade in said frcezers (lild food in C0l111nerce, as ;'commerce," is c1eiinerl in the Fe,deral Trade Commission Act.

PAR. 4. In the course n"lld conduct of their business, nr, all time"" mentioned herein, respondents have been in substantial competition in commerce with corporations, firms and individuals in t.he 3a1e. of freezers, food Bnd food freezer plans.

PAIl tJ, In the course and (,olldnct, of' j- hrir 1J\:-illf''-'- . l'J'-:)i)ndc,nts have disseminated, and caused the dissemination of, c.Cl'aill ."dV81'tisements by the Vnitec1 States mails and hy various means in commerce including but not limited to radio and television broadcasts, as "commerce" is deiined in the Federal Trade, Commission Ace for the purpose of inducing, ftnc1 ,\ hieh ,were likely ra inrluce.. directly or indirectly, the purchase of fOQel, as the t( rm ;;Joocr. is defined in the Federal Trade Commission Act. and have disscmInate. Uld caused the dissemination of, ,ldvel'tisements hy \-al'iOllS m( ans including those aforesaid, for the pmpose of inducing: :1lc1 which "were likely to induce, directly or indirectly, the purchase of food in commerce, as "C01lrneTcc:' is denned in the Federal11 Trade Commission Act.

PAIL 6. By means of ach-ertisemenls dissemiwued, as Lfol' sa.i(i: and otherwise, respondents lulve represented, directly or by implicfltion: ) That respondents' principal business is the sale of food: ALPIX INC. , ET AL. 139 137 Complaint (b) That purchasers of respondents' freezer food plan will receive all oftheirfood and a freezer for $6.2001'$7. 70 per week; (c) That purchasers of respondents' freezer food plan are thereby able to purchase their food for Jess money than they would otherwise have to pay;

(d) That purchasers of respondents' freezer food plan save from $200.00 to $300.00 a year on their food purchases; (e) That respondents are giving away various free gifts; (f) That purchasers of respondents' freezers food plan are required to pay no money for two months, and that the total amount such purchasers pay is the aggregate of either $6.20 or $7.70 per week for 24 months;

(g) That $6.20 per week for respondents' freezer food plan is a reduced price;

(h) That the freezers sold by respondents are unconditionally guaranteed for variously stated periods of time or for a lifetime. PAR. 7. The advertisements disseminated as aforesaid, were and are misleading in material respects and constituted and now constitute false advertisements" as that term is defuled in the Federal Trade Commission Act, and the aforesaid statements and representations were and are false, misleading and deceptive. In truth and in fact: (a) Respondents' principal business is that of selling freezers and not the selling of food;

(b) The purchasers of respondents' freezer food plan do not receive aU of their food and a freezer for either $6. 20 or $7.70 per week; (c) Purchasers of respondents' freezer food plan are not thereby enabled to purchase their food for less thll n they ",yonlcl otherwise have to pay;

(d) Purchasers of respondents' freezer food plan do not save from $200.00 to $300.00 a year on their food purchases; (e) Respondents do not give avmy free gifts. Such gifts are received only upon the purchase of respondents' freezer food plan; (f) Purchasers of respondents' freezer food plan are required to make a down payment at the time of purchase and still pay approximately $6. 20 or 87.70 per week for 24 months, thus respondents' have misrepresented the pnrchafie price of their freezer food plan; (g) Tho price of $6.20 per week lor respondents' freezer food plan is not a reduced price;

(h) The freezers sold by respondents are not unconditionally guaranteed for a lifetime or for the variously stated periods of time. PAR. 8. The use by respondents of the aforesaid false, misleading and deceptive statements and representations has had and now has the. Decision and Order 61 F.

capacity and tendency to mislead members of the purchasing public into the erroneous and mistaken belief that said statements and representations were and are true and into the purchase of substantial quantities of freezers and freezer food plans from respondents by reason of said erroneous and mistaken belief. PAR. 9. The aforesaid acts and practices of respondents, as herein alleged, including the dissemination by respondents of the false advertisements, as aforesaid were and are all to the prejudice and injury of the public and of respondents' competitors, and constituted and now constitute unfair and deceptive acts and practices in commerce, in violation of Sections 5 and 12 of the Federal Trade Commission Act.

DECISION AXD ORDER The Commission having heretofore determined to issue its complaint charging the respondents named in the caption hereof ,with violation of the Federal Trade Commission Act, and the respondents having been served ,with notice of said deternlination and ,with a copy of the complaint the Commission intended to issue, together with a proposed form of order; and The respondents ,md counsel for the Commission hl1ving therel1after execut.ed an agreement containing a consent order, an admission by the respondents of all the jurisdictional facts set forth in the complaint to issue herein, a statenwnt that the signing of said agreement is for settlement purposes only a,nd does not constitute an admission by respondents that the la,v has been violated as set forth in such complaint, and waivers and provisions as required by the Commission rules; and The C01nmission, having considered the agreement, hereby accepts same, issues its complaint in the form contemplated by said agree. ment, makes the following jurisdictional findings, and enters the following order:

1. R,respondent, A.\lpin, Inc., is a corporation organized, existing and doing business as Cincinnati I ood Service & Appliance Company, under nncl by virtue of the la ws of t.he State of Ohio, with its offce and principal place of business located at 3612 Iontgomery Hoad, in the city of Cincinnati, State of Ohio.

Respondents Milton Pinsky and Daniel .J. Allen arc oflcers of said corporation and their undress is the same as that of said corporation. . The Federal Trade Commission has jurisdiction of the subject matter of this proceeding and of tlle respondents, and the proceeding is in the public interest.

ALPI ) IXC. ) ET AL. 141 137 Decision and Order ORDER lohr I It ,is ordered That respondents Alpin, Inc. , a corporation, and its offcers, and :Milton Pinsky and Daniel J. c\.len, individually and as offcers of said corporation, and responclents agents, representatives and employees directly or through any corporate or other device in connection with the offering for sale, sale or distribution of freezers food or freezer-food plans, in commerce, as ':commerce" is defined in the Federal Trade COlilnission Act, do forthwith cease and desist from:

1. Hepresenting directly or by impJicfttion: (0) That respondents' principal business is the sale of food.

(b) That purchasers of a freezer food plan from respondents will for any stated price receive all of their foou or any amount of food in excess of the amount actually received and a freezer;

(c) Thftt by purchasing a freezer food plan from respondents, purchasers are thereby able to purchase food for less money than they 'would ot.herwise have to pay; (d) That purchasers of a freezer food plan from respondents save from $200.00 to $300.00 0 year on their food purchases, or \will save any other stated or specified amOlmt of money;

(e) That respondents give away free gifts; (f) That purchasers of a freezer food plan from respondents are required to pay no money for any stated period of tinle;

(g) That a customary or uSlml price is a reduced price; (h) That any freezer or part thereof is unconditionally guaranteed or is gURTfllteecl in any manner unless the nature and extent of the guarantee and the manner in TVhich the guarantor will perform thereunder are clearly and conspicuously disclosed.

. 31isrepresenting in any manner the savings rea.lizccl by purchasers of a free.zer food plan.

3. l\1isreprcsenting in any ma,nner the purchase price of any such freezer, food, or freezer food plan.

I.RT II It is further OJ'dated That respondents Alpin, Inc., a corporation and its offcers, and Milton Pinsky ancl Daniel J. Allen, individually Complaint 61 F.

and as offcers of said corporation, and respondents' agents, represent atives and employees, directly or through any corporate or other device in connection with the offering for sale, sale, or distribution of any food or any purchasing plan involving food, do forthwith cease and desist from:

1. Disseminating or causing to be disseminated any advertisement by means of the United States mails or by any means in commerce, as "commerce" is defined in the Federal Trade Commission Act, which advertisement contajns any of the representations or Inisrepresentations prohibited in paragraphs 1, 2 and 3 of Part I of this Order.

2. Disseminating or causing the dissemination of any advertisement by any means for the purpose of inducing or which is likely to induce, directly or indirectly, the purchase of any food or any purchasing plan involving food in commerce, as " C0111merce" is defined in the Federal Trade Commission Act ,vhieh advertise1llent contains any of the representations or misrepresentations prohibited in paragraphs 1, 2 and 3 of Part I of this Order.

It;8 fUTthe? oTdei'ed That the respondents herein shan, within sixty (60) days after service upon them of this order, file with tho Commission a report in writing setting forth in detail the manner and form