2361 State Corp.

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without the prior approval of the Federal Trade Commission. Ix THE MA TI'ER OF 2361 ST.'\.TE CORP. ET AL.

COXSEXT ORDER , ETC., IX REGARD TO TUE ALLGED VIOLATION OF THE FEDERAL TRDE CO DfISSION ACT Docket C-7B5. Complaint, Apr. 19G4 Decisi.on, Apr. , 1964 Consent order requiring Chicago manufacturers of mattresses, box springs and other bedding products, to cease representing falsely by attaching to their mattresses labels upon which fictitions and excessive amounts were printed that such amounts did not exceed the bighest price at \..bich substanti-al sales were made in their trade area; and by use of such ",'ords on labels as ORTHOPEDIC" along with a picture of a man in white jacket that the mattresses ,,,ere specially designed to prevent or correct body deformites and were prescribed by doctors.

2361 STATE CORP. Err AL. 311 310 Complaint COl\fPLAr:

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, Imving reason to belie'm that 2361 State Corp. a corporation (formerly known asa. Brandwein & Co. ), and IIal'ry T. Brandwein and Sidney L. Brandwein, individually and as offcers of said corporation, hE'Tcinafter 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 be in the public interest, hereby issues its complaint, stating its charges in that respect as follows:

P ARAGRAPlI 1. Respondent 2361 State Corp. (formerly known as A. Brand,vein & Co. ) is a corporation organized, existing and doing business under and by virtue of the laws of the state of Illinois with its principal offce and place of business located at 2361 South State Street, Chicago 16, Illinois.

Respondents Harry J. Brandwein and Sidney L. Brandwein are offcers of the corporate respondent. They formulate, direct and control the policies, acts and pra.ctices of the corpor(lte respondent illcluding the acts and practices hereinafter set forth. Theil' address is the same as that of the corporate respondent. PAR. 2. Respondents are now and for some time last past have been ngaged in the advertising, manufacturing, sale and distribution of mattresses, box springs and other bedding products to reta.ilers for resale to the public.

PAR. 3. In the course and conduct of their business, respondents now cause, and for some time last past have caused, their products when sold, to be shipped from their place of business in the State of Illinois to purchasers thereof located in the various other States of the United States, and maintain, and at all times mentioned herein, have maintained, a substant.ial course or trade in said products in commerce, as "commerce" is defined in the Federal Trade Commission Act. PAR. 4. Respondents, for the purpose of inducing the purchase of their mattresses, have engaged in the practice of attaching, or caus. ing to be attached, to their mattresses labels upon which certain amounts are printed thereby representing, directly or b;y implication that said amounts do not appreciably exceed the highest price at which substantial sales aT the pretickctecl article arc made ill respondents trade area. In truth and in fact said amounts are fictitious and are appreciably in excess of the highest price at which substantial so.1es of said pretickctcd article are made in respondents' trade area. PAR. 5. R.respondents, in the course ancl conduct of their business and for the purpose of inducing the sa.1e of their mattresses, ha ye p , 312 FEDERAL TRADE COM:rnSSION DECISIONS Complaint 65 F, engaged in the practice of attaching or can sing to be attached to their mattresses labels which contain statements, representations and depictions of which the following are typical but. not aU inclusive. ORTHO-PEDIC DE LUXE CITATIOX SCIEXTIFICALLY COXSTRUCTED FOR PROPER SUPPORT 1.1 )cpictiol1 of a 'woman reclining 011 a mattress. Standing to one side is a !lJftn ill w11ite jacket, ohstensibly a Doctor, writilJg a prescription. Created exclusively by A. BIL-L'\DWEI!\ and CO., CHICAGO, ILL.

Beauty Bracer ortllo-pedic type construction m. G. By and through the tlse of the aforesaid statements anc1representations appearing on labels respondents have represented directly or indirectly:

1. Through the use of the name "Ortho-Pedic" and the statement orthopedic type construction ' alone or in conjunction with the vari DUS stat.ements and representations above set forth relating to said mattre,sses that said mattresses have been specially designed and constructed so as t.o prevent, correct or afford substantial relief wit.h respect to a p('eific. body deformity or deformities and accord ,,"ith recommendations of orthopedic authorities respecting design flnd construction of ma.ttresses for the prevention, correction or relief of such deformity or deformities.

::. That doctors or the medical profession prescribe the n."e of mattI' esses manufactured and sold by respondents. \TI. 7. In truth and in fact:

1. Said mattresses have not been specially designed and construetcll so as to prevent, correct or afford substantial relief ,,"ith respect t.o a specific body deformity or deformities and do not. accord with rccommendations of orthopedic authorities respecting design and construction of mattresses for the prevention, correction or relief of such defOl'nity or deformities. Said mattresses are stock mattresses which are generally antihlblc and indiscriminately offered for sale and sold to the consuming public.

2. Doctors or the medical profession do not prescribe the use of mattresses manufactured and sold by respondents. There.fore the statements and representations as set forth in Paragraphs Five a.nd Six hereof ,"Were and are false, misleading and decepti ve.

2361 STATE CORP. ET AL. 313 310 Decision and Oroor PAR. 8. Respondents, by labeling their mattresses in the maimer aforesaid have placed in the hands of retailers and others the means and instrumentalities by and through which they may mislead the public as to the usual and customary retail price of said mattresses, the savings afforded to customers thereof and the therapeutic properties of said mattresses.

PAR. 9. In the conduct of their business, at all times mentioned here- , respondents have been in substantial competition, in commerce with corporations, firms and individuals in the sale of mattresses of the same general kind and nature as those sold by respondents. PAR. 10. The use by 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 representations were and are true and into the purchase of substantial quantities of respondents' product by reason of said erroneous and mistaken belief.

PAR. 11. The aforesaid acts and practices of respondents, as herein alleged, were and are a11 to the prejudice and injury of the public and of respondents' competitors and constituted, and now constitute, unfair methods of competition in commerce and unfair and deceptive acts and practices in commerce, in violation of Section 5 of the Fedeml Trade Commission Act.

DECISION AND ORDER The Federal Trade Commission having initiated an investigation of certain acts and practices of the respondents named in the caption hereof, and the respondents having been furnished thereafter with a copy of a draft of complaint which the Bureau of Deceptive Practices proposed to present to the Commission for its consideration and which if issued by the Commission, would charge respondents with violation of the Federal Trade Commission Act; and The respondents and counsel for the Commission having thereafter executed an agreement containing a consent order, an admission by the respondents of all the jurisdictional facts set forth in the aforesaid draft of complaint, a statement that the signing of said agreement is for settlement purposes only and does not constitute an admission by the respondents that the law has been violatcd as alleged in such complaint, and waivers and provisions as required by the Commission rules; and The Commission, having reason to believe that the respondents have violated the Federal Trade Commission Act, and having detsrmined that complaint should issue stating its charges in that respect, hereby 313-121--70-- Decision find Order 65 F. 'l' issues its complaint, accepts saiel agreement, makes the follo\"-ing jurisdictional findings and enters the following order: 1. Respondent, 23q1 State Corp., which corporation was formerly known as A. Brandwein & Co., is a corporation organized, existing, and doing business under and by virtue of the laws of the State of Illinois, with its offce and principal place of business located at 2361 South State Street, Chicago 16, Illinois.

Respondents I-Iarry J. Brandwein and Sidney L. Brandwein are offcers of the corporation and their address is the. same a that of the corporation.

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

ORDER It is ol'de'ie(l That respondents 2361 State Corp., a corporation (formerly known as A. Brandwein &, Co. ), and its offcers, and Harry .I. Brandwein and Sidney L. Brandwein, indiyidnally and as offcers of said corporation, and respondents agents, representatives and e.mployees, directly or through any corporate or other device, in C011lection with the offering for sale, sale or distribution of mattresses, box springs, bedding products or any other article of merchandise in commerce as "commerce" is defu1ed in the Federal Trade Commission Act do forthwith cease and desist from:

1. The act or practice of preticketing merchandise at an inclicated reta.il price or otherwise disseminating or advertising a list suggested or other indicated retail price for respondents' merchandise: P1'vided, howeve' That it shall be a defense in any enforcement proceeding instituted for violation hereof, for respondent.s to afrmatively establish that such indicated retail price was disseminated or advertised in good faith and has not appreciably exceeded the highest price at which substantial sales of such article were being made in respondents' trade area. 2. Misrepresenting, directly or indirectly, the retail price at which respondents' merchandise is sold in respondents ' trade area or the reta.il price at which respondents' merchandise is sold in the trade area of any distributor or dealer in respondents merchandise.

S. -Using on labels or in any other manner depictions of doctors or members of the medical profession or representing, directly or indirectly, that members of the medical profession prescribe the use of respondents' mattresses or other bedding products. 4. 17 sing the word orthopedic or any variation thereof or the statement "Ortho-pedic type construction" or any other word FRk K G. SHATTUCK CO. ET AL. 315 310 Complaint term or statement of similar import or meaning in reference to or as descriptive of any said products: Provided, however That it shall be a defense in any enforcement proceeding instituted for violation hereof for respondents to establish affrmatively that: (a) The product involved has been specially designed and constructed so as to prevent, correct or afford substantial relief with respect to a specific body deformity or deformities; (b) The dcsign and construction of such product accords with recommendations of orthopedic authorities for the prevention, correction or relief of such body deformity or deformities; and (c) In using said word, term or statement, as aforesaid, it was accompanied by a designation of the kind or kinds of body deformities for which the product involved had been so designed and constructed.

5. Furnishing or otherwise placing in the hands of retailers or dealers of said products the means and instrumentalities by and through which they may mislead or deceive the purchasing public in respect to the things hereinbefore prohibited. It is furthe1' ordered That the respondents herein shall, within sixty (60) days after service upon them of this order, file with the Commission a report in writing setting forth in detail the manner and form