The Reader'S Digest Association, Inc.

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IN THE MATTER OF THE READER'S DIGEST ASSOCIATION, INC.

OONSEKT ORDER, ETC., IN REGARD TO THE ALLEGED VIOLATION OF THE FEDERAL TRDE COMMISSION ACT Docket 0-626. Complaint, Dec. 10, 1965-Decision, Dec. 10, 1963 Consent order requiring publishers of magazines, books, phonograph records, etc., with main offce at Pleasantvile, N. , to cease representing falsely in advertising that their "BEST SELLERS" volume could be obtained free absolutely free, or as a "paid in full gift", etc., when a binding obligation was incurred by persons accepting the book; that their Reader Digest magazine sold regularly at $4.00 but that because of their profit sharing policy subscribers were entitled to a greatly reduced price of only $2.97, and that a subscriber was obligated to continue his subscription and to pay the latter price unless he took affrmative action of cancellng his subscription; and ,representing falsely on the letterhead of "The Mail Order Credit Reporting Association, Inc. " that delinquent accounts had been turned over to an independent collection agency with instructions to take all necessary legal steps to collect amounts due, when the purported collection agency was only a mailng address utilzed by respondent. COMPLAINT Pursuant to the provisions of the Federal Trade Commission Act and by virtue of the authority vested in it by said Act, the Federal Trade Commission, having reason to believe that The Reader s Digest Association, Inc, a corporation, hereinafter referred to as respondent has violated the provisions of said Act, and it appearing to the Commission that a proceeding by it in respect thereof would be in the public interest, hereby issues its complaint stating its charges in that respect as follows:

P ARAGRAFH 1. Respondent The Reader s Digest Association, Inc. is a corporation organized, existing and doing business under and by virtue of the laws of the State of Delaware, with its principal offce and place of business located at PleasantviJle, in the State of New York.

PAR. 2. Respondent is now, and for some time last past has been engaged in the publishing, advertising, offering for sale, sale and distribution of magazines, books, phonograph records and other articles of merchandise to the public.

PAR. 3. In the course and conduct of its business, respondent now causes, and for some time last pa,st has caused, its said products when sold, to be shipped from its place of business in the State of New York and from various other sources of supply in the States of Massachusetts and Indiana to purchasers thereof Jocated in various other 780-018--69--105 1654 FEDERAL TRADE CO:MvIISSION DECISIO Complaint 63 F.

states of the United States and in the District of Columbia and maintains, and at all times mentioned herein has maintained, a substantial course of trade 1n said products in commerce, as "commerce" is defined in the Federal Trade Commission Act.

PAR. 4. In the course and conduct of its business and for the purpose of inducing the sale of its books, respondent has made certain statements and representations by advertisements in magazines and in pamphlets, brochures and other advertising materials disseminated by and through the United States mail to subscribers and others on its own and other mailing lists.

Typical and illustrative of such statements and representations, but not a1l inclusive thereof, nre the followil1g excerpts from one five piece mailing packet distributed by the respondent to potential customers: a. On the mailing envelope in large black print: YOUR COPY OF A MAG- IFICENT NEW BOOK IS PAID 1:- FUL b. On a large, multi-colored advertising piece at the top of the front side in large conspicuous letters: Hcgular Price $2.73 - YOURS absolutely FREE. Bgpi SELLERS from HEADER'S DIGEST CONDENSED BOOKS. On the revcrse side of this advertising piece: Order your FREE book Today1J I c. On a large multi-colored cardboard enclosure entitled RESERV A'l' CERTH' ICATE; a cardboard tol en with the words PAID IN FULL and the statements IMPORTANT This Paid in Full "Credit" Token reserves a valuable $2.73 voluile fur you! Please return it promptly to us, placed in the YES" pocket at right and your FREE Book wil be shipped at once. Also appearing on this cardboard enclosure: To Secure your FREE volume, place your "Paid ill Full" Token Here, Send $2,73 " ST SELLERS" Volume JiREE! and the al)Qve named Reader s Digest Subscriber is entitled to receive the :Kew "Best-Sellers From Reader s Digest Condensed Books" - Regular Price $2.73 Al)solutely FREE! d. On the top of a two page typed, single spaced letter, in large red printing: Return your "Paid in Full" Credit Token TODAY and you wil Receive a Free Copy of a New 576-Page Book, "BEST SELLERS From READER'S DIGEST DEKSED BOOKS" - Regular Price $2. 73 - Absolutely JIREJjI PAR. 5. Through the use of the aforesaid statements and representations, and others of similar.r import and meaning not specifically set forth herein, respondent represents and has represented, directly or by implication, that the offer of said book is without limit, restriction or qualification, that no obligation, duty or liability is incurred by persons accepting said book, and that said book is "free," absolutely free" and a " paid in fun gift"

PAR. 6. In truth and in fact:

The offer of said book is not without limit, restriction or qualification, and a very definite and binding obligation, duty or liability is , , , THE READER' S DIGEST ASSN., mc. 1655 Complaint1633 and said book is not "free,"incurred by persons accepting said book, Rbsolutely free" and not a paid in full gift" Persons receiving said book must agree to become a trial member of Reader s Digest Condensed Books and to accept and pay for subsequent volumes or to affrmatively notify the respondent of cancellation. The only way the proffered "free absolutely free book" or paid in full gift" can be obtained without becoming a trial subscriber to Reader s Digest Condensed Books is by the payment of the regular price of $2.73 plus postage.

In the advertising material described in Paragraph Four, the only , obligations or other prereference to or disclosure of the conditions requisites to the receipt and retention of said "free absolutely free or "paid in full gift" book is ambiguously and inconspicuously contained in the letter which is one piece of the five piece packet. The remaining pieces of the afore-described mailing packet contain no reference, disclosure or other indicat.ion of any conditions, obligations or other pre-requisites to the receipt and retention of the free book. The conditions, obligations and other pre-requisites to receipt and retention of said "free absolutely free" or "paid in full gift" books are, therefore, not clearly and conspicuously explained or set forth at the outset so as to leave no reasonable probability that the terms of the advertiscments or offer might be misunderstood. Other similar advertising and promotional materials offer said books at nominal amounts instead of "free, such as New Condensed Best- Sellers for 21 each." Said advertising and promotional materials do not clearly and conspicuously disclose the other conditions, obligations and other pre-requisites to the receipt and retention of the nominally priced book.

Therefore, the statements and representations as set forth in Paragraphs Foul and Five hereof were and are false, misleading and deceptive.

PAR. 7. Respondent, for the pmpose of inducing the renewal of subscriptions to its magazine, Reader s Digest, has distributed and disseminated to its subscribers, by and through the United States mail, a series of letters and advertising materials containing various representations and statements, of which the following arc typical but not all inclusive:

a. In the initial letter of this series- ANNOVNCING * '" .. A Profit- Sharing Plan for Digest Subscribers - with .. li "a 26% Reduction in Price! Your present subscription normally would expire about three months from now.

But under the Dig st' Continuing Service plan, your subscription wil not expire" at that time. Instead, it wil be continued without interruption Complaint 63 F.

as 70ng as you wish it continued - at a greatly reduced price " . " P.S. IMPORTAI\T! If, for some reason, you do not wish to continue your subscription for the coming year, would you be good enough to tell us when you receive the statement; simply write "cancel" across it and return it to me, so that I can remove your name from our list of Continuing Subscribers. Otherwise, you need do nothing but pay the $2.97 when the statement arrives - and your subscription wil be happily continued, without interruption. b. In a second letter, which is mailed in an envelope marked from the respondent's "CONTROLLER' S OFFICE" and marked PROFIT-SHARING STATEMENT ENCLOSED FOR YOUR CONTINUING SUBSCRIPTION.

A few weeks ago I wrote to tell you why you are now entitled to a greatly red,uced price because of our profit sharing policy of Continuing Subscription Service As I promised you, your present subscription wil be continued for the coming year (to the date stamped on the enclosed statement) at only $2,97. You save over $1.00 on the regular $4.00 price! . " . you do not wish to continue your Digest for the coming year S. - If would you please write "Cancel" on the enclosed statement and return it to , so that I can remove your name from our profit-sharing list of Continuing Subscribers? c. Enclosed with this second letter is a "statement" containing the following:

Please be sure to RET'CR:- THIS CARD with your payment.. .. .. If you have already paid, please disregard this notice " .. II REGULAR ONE YEAR Price $4.00. PAY THIS A110UNT ONLY SPECIAL REDUCED PRICE $2.97. d. Subsequent letters are also mailed in envelopes containing the markings "CONTROLLER' S OFFICE", and "PROFIT-SHAI ING STATEMENT ENCLOSED FOR YOUR CONTINDING SUBSCRIPTION", and include a "statement" similar to the one. previously described in sub-paragraph " " hereof and a note or lever "ith statements and representations similar to those previously quoted and described in sub-paragraphs " " and "b" hereof. PAR. 8. By and through the use of the above quoted statements and others of similar import not specifically set out herein, tbe respondent represented and represents that:

a. The higher stated price set out in said advertisements and materials in connection with the term "regular" is the price at which thc subscription is usually and customarily sold by respondent and that the difference between the higher and lower prices represents savings to subscribers from respondent's usual and customary subscription price.

b. The subscriber s subscription to Reader s Digest magazine has alrcady been renewed for another year and that the subscriber is THE READEH' S DIGEST ASE:N., INC. 1657 1653 Complaint obligated to make the payment of $2.97 unless the subscriber takes the affrmative action of cancellng the subscription. PAR. 9 In truth and in fact:

a. The higher stated price set out in said advertisements and materials in connection with the term "regular" is not the price at which tho subscription is usually and customarily sold by respondent and the difference between the higher and lower prices do not represent savings to subscribcrs from respondent's usual and customary subscription price.

b. The subscriber s subscription to Reader s Digest has not been renewed for another year and the subscriber is not obligated to make the payment of $2.97 whether or not the affrmative action of cancelling the subscription by notifying the respondent is taken. Therefore, thc statements and representations as set forth in Paragraph Seven and Eight hereof were and are false, misleading and deceptive.

PAR. 10. In the course and conduct of its business and for the purpose of inducing the payment of delinquent accounts, respondent has made certain statements and representations through letters and materials sent through the United States mails to deliquent customers who have purchased books or subscribed to Reader s Digest magazine. Said delinquent customers receive a total of 12 mailings, of which 9 are on the letterhead of the respondent, Reader s Digest, and the last three are on the letterhead of The Mail Credit Reporting Association, Inc. of 12 IV est 38th Street, K ew York 18, New York.Order Typical but not ajj inclusive of the representations and statemcnts contained in said mailings are the following: A. On mailings using respondent' s letterhead: a. Your account is in the red'" * '" All it takes is a small check or money order from you - to put it safely in the black again. Your credit is stil good, and I'm sure you want to keep it that way b, PLEASE I '" ol '" pay this past due bil NOW. c. Your credit standing is worth far more to YOU than this small amount. That is why we are sending you this postage stamp with the POLITE but UHGENT REQUEST that you use it to mail your payment in the enclosed envelope- TODAY.

d. THE LAST WORD FROM InJADER' S DIGEST ABOUT YOUR UN- PAID ACCOUNT'" '" II This is the last letter you wil receive from Reader s Digest about the small amount which you owe us, and about which we have written many times over a period of months. "'" '"

\Ve don t like to turn over the names of our members to a collection agency, but we are sure you wil agree it is reasonable for us to expect that those who have owed us money for many months will pay it. ......

1658 FEDERAL TRADE CQ:\1:1\TISSION DECISIONS Complaint G3 F.

. '" '" We are sure you wil agree that we are being scrupulously fair when we send you one more appeal for payment before t1trning over your account to a collection agency.

This wil be done if we do not hear from you within the ncxt fourteen days. Such action as is taken after that date wil be out of our hands B. On the letterhead of The Mail Credit Reporting Association, Inc., 15 West 38th Street, New York 18, New York-Order a. We have been notified by one of our members, Reader s Digest Consensed Books, of your failure to pay a past due account. .A duplicate of their statement is enclosed. They have engaged us to take whatever legal steps are necessary to secure payment. . '" '"

b. SECOND NOTICE A duplicate statement of your account with Reader s Digest Condensed Bool is enclosed herewith. We have been instructed to take any necessary legal steps to effect collection. '" '" '"

Before we proceed further, we are gi,ing you a final opportunity to make payment. Although the sum involved is small, it is our business to collect our clients' delinquent accounts regardless of size, and we are organized for that purpose. In the event of legal action, you may not be aware that court costs nnd attorney fees must be paid uy the person against whom judgement is rendered. Legal action against you may result in considerable additional expenses to you. If you doubt this statement, we suggest that you consult your own attorney.

In order that you may avoid unnecessary expense, we urge you to send your payment today in the enclosed envelope.

c. FINAL NO'l' ICE Your account with Reader s Digest Condensed Books was turned over to us some time ago for collection. "'.. '" This is the last request for payment which we shall send.

* .. .. We hope it wil not be necessary to take legal action, .. * tI PAR. 11. By and through the use of the above quoted statements and ot.hers of similar import not specifically set out herein, respondent represented and represents that:

(a.) If payment is not made, the delinquent customer s name will be transmitted to a credit rating agency or bureau with the result. that said customer s credit, rating will be adversely affected. (b) If payment is not made, the account will be turned over to an independent, bona fide collection agency.

(c) The ).fail Order Credit Reporting Association, Inc., is an independent, bona fide collection agency.

(d) The letters and notices with said The Mail Credit Reporting Association s name and address thereon are prepared andOrder sent by that agency.

(e) The respondent has turned over to The Mail Credit Reporting Association, Inc., the delinquent account of the customerOrder for collection with instructions to take all necessary legal steps to collect the outstanding amount due.

THE READER' S DIGEST ASSN. , lnc. 1659 1653 Complaint PAR. 12. In truth and in fact:

(a) If payment is not made, the delinquent customer s name is not transmitted to a credit rating agency or bureau with the result that said customer s credit rating is adversely affected. The failure to pay such indebtedness is not reported to any credit rating bureau nor is any record maintained thereof by respondent. (b) If payment is not made, the account is not turned over to a bona fide independent collection agency.

(c) The Mail Credit Reporting Association, Inc., is not an independent, bona fide collection agency.Order (d) Letters and notices with said The Mail Credit Reporting Association s name and address thereon are not prepared andOrder sent by that agency. Said letters and notices are prepared by the respondent and distributed from its place of business in Pleasantvile N ew York. Replies to letters bearing The Mail Credit Reporting Association, Inc., address are in fact forwarded to the respond-Order ent, unopened. The Mail Credit Reporting Association, Inc. is only a mail address utilized by the respondent.Order (e) The respondent has not turned over to The Mail Credit R.eporting Association, Inc. , the delinquent account of the customerOrder for collection nor has the respondent instructed said Association to take all necessary legal steps to collect the outstanding amount due. Therefore the statements and representations as set forth in Paragraphs Ten and Eleven hereof were and are false, misleading and deceptive.

PAR. 13. In the conduct of its business and at all times mentioned herein, the respondent has been in substantial competition, in com meree, with corporations, firms and individuals in the sale of magazines, books, phonograph records and other articles of merchandise of the same general kind and nature as that sold by the respondent. PAR. 14. The use by respondent 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 representations were and are true a.nd into the purchase of substantial quantities of respondent's products and merchandise and into the payment of substantial sums of money to respondent by reason of said erroneous and mistaken belief. PAR. 15. The aforesaid acts and practices of respondent, as herein alleged, were and are all to the prejudice and injury of the public and of rBspondent's competitors and constituted, and now constitutes , , Decision and Order 63 F.

unfair methods of competition in commerce and unfair and deceptive acts and practices in commerce, in violation of Section 5 of the Federal Trade Commission Act.

DECISION AND ORDER The Commission having heretofore determined to issue its complaint charging the respondent named in the caption hereof with violation of the Federal Trade Commission Act, and the respondent having been served with notice of said determination and with a copy of the complaint the Commission intended to issue, together with a a proposed form of order; and The respondent and counsel for the Commission having thereafter executed an agreement containing a consent orde.r, an admission by respondent of all the jurisdictional facts set forth in the complaint to issue herein, a statemcnt that the signing of said agrcement is for settlement purposes only and does not constitute an admission by respondent that the law has been violated as set forth in such complaint and waivers and provisions as required by the Commission s rules; and The Commission, having considered the agreement, hereby aecepts same, issues its complaint in the form contemplated by said agreement, makes the following jurisdictional findings, and enters the following order:

1. Respondent The Reader s Digest Association, Inc., is a corporation organized, existing and doing business under and by virtue the laws of the State of Delaware, with its offce and principal place of business located in the City of Pleasantvile, State of N ew York. 2. The Federal Trade Commission has jurisdiction of the subject matter of this proceeding and of the respondent, and the proceeding is in the public interest.

ORDER It i8 ordered That respondent The Reader s Digest Association Inc. , a corporation, and its offcer, and respondent's agents, representatives and employees, directly or through any corporate or other device, in connection with the offering for sale, sale or distribution of magazines, books, phonograph records or any other articles of merchandise, in commerce, as "commerce" is defined in the Federal Trade Commission Act, do forthwith cease and desist from: 1. Using the words "free absolutely free paid in full gift" or any other word or words of similar import or meaning, THE REAbER' S DIGEST ASSN. , D/C. 1661 1653 Decision and Order to designate or describe articles of merchandise or representing that articles of merchandise are offered at nominal amounts, in advertising or in other offers to the public when all of the conditions, obligations, or other prerequisites to the receipt and retention of the said free or nominally priced articles of merchandise are not clearly and conspicuously explained or set forth at the outset so as to leave no reasonable probability that the terms of the advertisements or offer might be misunderstood. 2. Using the word "regular, or words of similar import, to refer to any amount which is in excess of the price at which such merchandise has been usually and regularly sold by respondent at retail in the recent, regular course of its business; or otherwise misrepresenting the respondent's usual.l and customary retail selling price of such merchandise.

3. Representing that any saving is offered in the purchase of merchandise from the respondent unless the price at which the merchandise is offered constitutes a reduction from the price at which said merchandise was usually and customarily sold by the respondent at retail or at which said merchandise was usually and customarily sold at retail in the trade area involved. 4. ;vIisl'cpresenting in any Inanner the savings availa.ble to pur chasers of respondent's Inerchandise.

5. Representing, directly or indirectly that: a. Subscriptions or orders for the aforesaid products or other contractual relationships between respondent and members of the public have been entered, renewed, established or otherwise effected for any period of time obligating the payment of any sum of money or the performance of any other act in the absence of the direct ancl expressed agreement of such members of the buying public.

b. Members of the buying public who have not directly and expressly agreed to become indebted to respondent are obligated or Hable to pay any amount for goods or services offered for sale 01' sold by respondent.

O. Hcpresenting, directly or indirectly, that delinquent customers' general or public credit ratings will be adversely airected unless respondent in fact refers the information of sue11 delinquency to a separate, bona. fide eredit rating agency or bureau or other business enterprises.

7. Representing, directly or indirectly, that delinquent accounts 'ivi1J be turned over to an independent, bona fide collec- FEDERAL TRADE COMMISSIO DECISIO1662 Order 63 F.

tion agency unless respondent in fact turns said accounts over to such agencies.

8. Representing, directly or indirectly, that any organization or trade name owned in whole or in part by respondent or over which respondent exercises operating control is an independent, bona fide collection agency.

9. Representing, directly or indirectly, that letters, notices or other communications which have been prepared or originated by respondent have been prepared or originated by any other person, firm or corporation.

10. Representing, directly or indirectly, that delinquent accounts have bee,n turned over to any person, firm or corporation with instructions to take legal steps to collect the outstanding amount due unless such is the fact.

It i8 further ordered That the respondent herein shall, within sixty (60) days after service upon it of this order, file with the Commission a report in writing setting forth in detail the manner and fol"u in which it has complied with this order. IN THE :MATTER OF SKAP-OK TOOLS CORPORATION ORDER, ETC. , IN REGARD '10 THE ALLEGED VIOLATION OF THE FEERAl, TRAE TRADE C01of:MISSION ACT Dec. , 1963 Docket "/116. Complaint, Apr. 10, 19GB-Decision, Order dismissing complaint as directed by the Court of Appeals, Seventh Circuit, of July 30, 1963, 321 F. 2d 825, 7 S. &D. 753; the Commission s order Nov. 1, 1961, 59 F. C. 1035, required respondent manufacturer mechanics' hand tools and related equipment, to cease forcing its dealers to enter into exclusive dealing agreements. ORDER DISMISSING COMFLAINT The United States Court of AppeaJs for the Seventh Circuit having on July 30, 1963, entered its judgment setting aside the Commission s order to cease and desist and directing the Commission to dismiss its complaint;

It is ordered That the Commission s complaint herein be, and it hereby is, dismissed.

, CAMEO FUR CO. , E'l' 1663 Complaint IN THE lI TIR OF RUTH SEGAL ET AL., TRADING AS CAMEO FUR CO., ETC. CONSENT ORDER , ETC. , IN REGARD TO THE ALJ EGED VIOLATION OF THE FEDERAL TRADE COMMISSIOK AND THE F'R PRODUCTS LAELING ACTS Dooket 0-627, Complaint, Dec. 11, 1963-Decision, Dec. 11, 1963 Consent order requiring manufacturing furriers in New York City to cease violating the Fur Products Labeling Act by failng to label as "Natural" fur products which were not artificially colored; failng, on invoices, to show the true animal name of furs and the country of origin of imported furs, to disclose when fur was bleached or dyed, etc., and to use the terms "Persian Lamb" Dyed Broadtail.processed Lamb", and "Natural" where required; invoicing fur products deceptively as "Broadtail Lamb" j failng in other respects to comply with labeling and invoicing requirements; and furnishing false guaranties that their fur products were not misbranded, falsely invoiced or falsely advertised. COMPLAINT Pursuant to the provisions of the Federal Trade Connission Act and the Fur Products Labeling Act and by virtue of the authority vested in it by said Acts, the Federal Trade Connission having reason to believe that Ruth Segal and Moe Segal, individually and as copartners trading as Cameo Fur Co. and Claire of Cameo, hereinafter referred to as respondents, have violated the provisions of said Acts and the Rules and Regulations promulgated under the Fur Products Labeling Act, and it appearing to the Commission that a proceeding by it in respect thereof would be in the public interest hereby issues its complaint stating its charges in that respect as follows:

PARAGRAPH 1. Respondents Ruth Segal and Moo Segal are individuals ancl copartners trading as Cameo Fur Co. and Claire of Cameo.

Respondents are manufacturers and retailers of fur products with their offce and principal place of business located at 363 Seventh Avenue, New York, ="ew York.

PAR. 2. Subsequent to the effective date of the Fur Products Labeling Act on August 9, 1952, respondents have been and are now engaged in the introduction into commerce, and in the manufacture for introduction into commerce, and in the sale, advertising, and offering for sale in commerce, and in the transportation and distri- 1664 FEDERAL TRADE C01-nvrSSIOK DECISIQXS Complaint 63 F.

bution in commerce, of fur products; and have manufactured for sale, sold, advertised, offered for sale, transported and distributed fur products which have been made in whole or in part of furs which have been shipped and received in commerce, as the terms "commerce, "fur" and "fur product" are defined in the Fur Products Labeling Act.

PAR. 3. Certain of said fur products were misbranded in that they were not labeled as required under t.he provisions of Seetion 4(2) of the Fur Products Labeling Act and in the manner and form prescribed by the Rules and Regulations promulgate.d thereunder. Among such misbranded fur products, but not limited t.here, , were fur products that were not labeled with any of the information rc quired under the said Act and said Rules and Rcglllations. PAR. 4. Certain of said fur products were misbranded in violation of t.he Fur Products Labeling Act. in that they were not labeled in accordance with the Rules and Regulations promulgated thereunder. (a) The term "natural" was not used on htbels to describe fur products which were not pointed, bleached, dyed, tip-dyed, or otherwise artificially colored, in violation of Rule 19(9) of said Rules and Regulations.

(b) Information required under Section 4(2) of the Fur Products Labeling Aet and the Rules and Rcgulations promulgated thereunder was not completely sct out on one side of labels, in violation of Rule 29(a) of said Rules and Regulations.

(c) Information required under Section 4(2) of the Fur Products Labeling Act and the Rules and Regulations promulgated thereunder was not set forth in the required sequence, in violation of Hule 30 of said Rules and Rcgulations.

(d) Required item numbers were not set forth on labels, in violation of Rule 40 of said Rules and Regulations. PAR. 5. Certain of said fur products were falsely and deceptively invoiced by the respondents in that they were not invoiced as required by Section 5 (b) (1) of t.he Fur Products Labeling Act and the Rules and R.egulations promulgated under such Act. Among such falsely and deceptively invoiced fur products, but not limited thercio, were fur products covered by invoices which failed: 1. To show the true aninml name of the fur used in the fur product. 2. To disclose that thc fur contained in the fur product was bleached, dyed, or otherwise artilicia1Jy colored, when such was the fact.

8. To show the country of origin of imported furs used in fur products.

CAMEO Fun co. , ETC. 1665 1663 Decision and Order PAR. 6. Certain of said fur products were falsely and deceptively invoiced with respect to the -name or designation of the animal or animals that produced the fur from which the said fur products had been manufactured, in violation of Section 5(b) (2) of the Fur Products Labeling Act.

Among such falsely and deceptively invoiced fur products, but not limited thereto, were fur products which were invoiced as "Broadtail" thereby implying that the furs contained therein were entitled to the designation "Broadtail Lamb" when in truth and in fact they were not entit.led to such designation.

PAR. 7. Certain of said fur products were falsely and deceptively llvoiccd in viola.tion of the Fur Products Labeling Act in that they were not invoiced in accordance with the Rules and Regulations promulgated thereunder in the following respects: (a) The term "Persian Lamb" was not set forth on invoices in the manner required by law, in violation of Rule 8 of said Rules and Regulations.

(b) The term "Dyed Broadtail-processed Lamb" was not set forth on invoices in the manner required by law, in violation of Rule 10 of sa,id Rules and Regulations.

(c) The term "natural" was not used on invoices to describe fur products which were not pointed, bleached, dyed, tip-dyed or otherwise artificially colored, in violation of Rule 19 (g) of said Rules and Regulations.

(d) Hequired item numbers were not set forth on invoices, in violation of Rule 40 of said Rules and Regulations. PAH. 8. Hespondents furnished ialse guaranties t1Uit certain of their fur products ,were not misbra,nded, falsely in'Toiced or falsely advertised when respondents in furnishing such guaranties had re-ason to believe tlmt fur products so falsely guarantied would be introduced, sold, transported or distributed in comnlerce, in violation of Sect.ion 10 (b) of the :Fur Products Labeling Act. PAn. 9. The aforesaid acts and practices of respondents, as herein alleged, are in violation of the Fur Products Labeling Act and the Rules and R.egulations pro1Tmlgated thereunder and constitute unfair and deceptive acts and pntctices and unfair methods of corn petition in commerce under the Federal Trade Commission Act. DECISION AND ORDER The Commission having heretofore determined to issue its complaint charging the respondents named in the caption hereof with violation of the :Fecleral Tracie Commission Act a,nd the Fur Products Decision and Order Labeling Act, and the respondents having been served with notice of said determination and with a copy of the complaint the Commission intended to issue, together with a proposed form of order; and The respondents and counsel for the Commission having thereafter executed an agreement containing a consent order, an admission by respondents of all the jurisdictional facts set forth in the complaint to issue herein, a statement that the signing of said agreement is for settlement purposes only and does not constitute an admission by respondents that the law has been violated as set forth in such complaint, and waivers and provisions as required by the Commission rules; and The Commission, having considered the agreement, hereby accepts same, issues its complaint in the form contemplated by said agreement, makes the following jurisdictional findings, and enters the following order:

1. Respondents Ruth Segal and Moe Segal are individuals and copartners trading as Cameo Fur Co. and Claire of Cameo. Respondents are manufacturers and retailers of fur products with their offce and principal place of business located at 363 Seventh Avenue, New York, New York.

2. The Federal Trade Commission has jurisdiction of the subject matter of tills proceeding and of the respondents, and the proceeding is in the public interest.

ORDER It i8 ordered That respondents Ruth Segal and Moe Segal individually and as copartners trading as Cameo Fur Co. and Claire of Cameo or under any other trade na, , and respondents' representatives, agents and employees, directly or through any corporate or other device, in connection with the introduction, or manufacture for troduction, into commerce, or the sale, advertising or offering for sale in commerce or the transportation or distribution in commerce of any fur product; or in connection with the manufacture for sale sale, advertising, offering for sale, transportation or distribution, of any fur product which is made in whole or in part of fur which has been shipped and received in commerce, as the terms "commerce "fur" and "fur product" are defined in the Fur Products Labeling Act, do forthwith cease and desist from:

A. Misbranding fur products by:

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

CAMEO FUR CO. , ETC. 1667 1663 Decision and Order 2. Failing to set forth the term "Natural" as part of the information required to be disclosed on labels under the Fur Products Labeling Act and the Rules and Regulations promulgated thereunder to describe fur products which are not pointed, bleached, dyed, tip-dyed, or otherwise artificially colored.

3. Failing to completely set out information required under Section 4 (2) of the Fur Products Labeling Act and the Rules and Regulations thereunder on one side of the labels affxed to fur products.

4. Failing to set forth information required under Section 4(2) of the Fur Products Labeling Act and the Rules and Regulations promulgated thereunder on labels in the sequence required by Rule 30 of the aforesaid Rules and Regulations.

5. Failing to set forth on labels the item number or mark assigned to a fur product.

B. Falsely or deceptively invoicing fur products by: 1. Failing to furnish invoices to purchasers of fur products showing in words and figures plainy legible all the information required to be disclosed in each of the subsections of Section 5(b) (1) of the Fur Products Labeling Act. 2. Setting forth on invoices pertaining to fur products any false or deceptive information with respect to the name or designation of the animal or animals that produced the fur contained in such fur product.

3. Failing to set forth the term "Persian Lamb" in the manner required where an election is made to use that term instead of the word "Lamb"

4. Failing to set forth the term "Dyed Broadtail-processed Lamb" in the manner required where an election is made to use that term instead of the words "Dyed Lamb" 5. Failing to set forth the term "Natural" as part of the information requjred to be disclosed on invoices under the Fur Products Labeling Act and the Rules and Regulations promulgated thereunder to describe fur products which are not pointed, bleached, dyed, tip-dyed or otherwise artificially colored.

6. Failing to set forth on invoices the item number or mark assigned to fur products.

It is further ordered That respondents Ruth Segal and Moe Segal individually and as copartners trading as Cameo Fur Co. and Claire 1-'EDERAL TRADE 1MISSI0K DBCISIONS1668 Complaint 63 r.

of Cameo, or under any other trade name, and respondents' representatives, agents and employees, directly or through any corporate or other device, do forthwith cease and desist from furnishing a false guaranty that any fur product is not misbranded, falsely invoiced or falsely advertised when the respondents have reason to believe that such fur product may be introduced, sold, transported, or distributed in commerce.

It i8 furthe?' orde?' That the respondents herein shall, within, sixty (60)days after service upon them of this order, fie with the Commission a report in writing setting forth in detail the manner and form in which they have complied with this order,