Reliable Manufacturing Company et al.

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

IN THE :llo\TTER OF CO:\IPXNY ET \L. RELIABLE MAJ'UFACTURIXG CONSENT ORDER, ETC., IN Rl GARD TO THE _-\ALLEGED VIOLATION OF TII' FEDERAL TIL\DE CO:.DIISSIQX \CT Docket C-176, Complaint, June-SO, 19G!;-Decision, June 30, HJG- Consent order requiring Franklin Park, H1., manufacturers of electric cooker. fryers which they sold to wholesalers, stamp redemption firms, catalog and mail order firms, wholesale discounters and retailers for resale, to cease their practice of supplying to their customers catalog sheets, drculars and cartons bearing representations such as "$19.93 Suggested List Price Guaranteed For 2 Years, when such "suggested price " appreciably exceeded the highest price at which substantial sales were made in their trade area and the 11Ur ported "2 year guarantee" was subject to undisclosed conditons" CO:.IPL\IKT Pursuant to the provisions of the Federal Trade Commission Act and by virtue of the authority vested in it by said Act, the Federal Tra,deCommission IULving reason to believe t.hat Reliable :Manufacturing Company a corporation, and Charles ,V. Leigh, individuals:,- anrl as an offcer of said corporation, hereinafter referred to as respondent:: have violated the provisions of sa,id Act, and it appearing to the Commission that a proceeding by it in respect thereof would be in the pnblic interest, hereby issues its complaint stiLting its charges in that. respect as follows:

PARAGRAPH 1. Respondent He1iable Janllfacturing Campau:," is corporation organized, existing a.nd doing ,business under and by Yirtue of the laws of the State of Illinois, with its principal offce and place of business located at 9201 King Street, Franklin Park, Illinois. Respondent Chades ,V. Leigh is in offcer of the corporftte respondent. He formula.te.;;, directs and controls the acts and practices of the corporate respondent, including the acts and practices hereinafter set forth. His address is the same as that of the corporate respondent. PAIL 2. Respondents are now, and for some time, last past hayc been engaged in the manufacturing, advertising, altering for sale. sale and distribution of electric cooker-fryers to "wholesalers, stamp redemption 1irms, cataJoguc and mail order firms. ,dlOlesnle discounters and rctailers for resa.le to the public and in the production of metal stampings for various customers.

PAIL 3. In the course and 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 illinois to purchasers thereof located in various other States of the , 1266 FEDERAL TRADE C011MISSION DECISIOKS Complaint 65 F.

United States and in the Djstrict of Columbia, and maintajn, 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 Commissjon Act.

PAR. 4. Respondents, for the pl1pose of inducing the purchase of their electric cooker- fryers have engflgcd in the practice of causing to be printed and supplying to their Cllst.omers catalcgue sheets, circulars and cartons bearing representabons such as $19.95 Suggested List Price Guaranteed For 2 Years.

PAR. 5. Through the use of the foregoing representations and others of similar import and meaning not expressly set out herein, responder:.ts rep:!.csent, directly or by implication, that: A. Said '( suggestfod retail price" is respondents' bona fide estimate of the actual retail price of said product and that said price amount does not appreciably exceed the highest price at which substantial sales are made in respondents' trade area.

B. Said product js unconc1itionaDy guaranteed for it period of two years 1\ithont further conditions or limitations. PAR. 6. In truth and in fact:

A. Said "suggested retail price ' is not respondents ' bona fide estimate of the actual retail price of said product and said price amolmt appreciably exceeds the highest price at which substantial sa-1es are made in respondents' tra.de area.

B. Said product is net unconditionally guaranteed for it period of two years '"1without further conditions or limitations. Respondents fail to set forth in their guarantee statement the nature and extent of the guarantee, the identity of the guarantor and the manner in which the guarantor will perform.

Therefore the statements and representations in Paragraphs Four and Five were and are false, misleading and deceptive. PAn. 7. In the conduct of their business, at all times mentioned herein, respondents have been in substantial competition, in commerce with corporations, firms and individuals in the sale of articles of merchandise of the sa,me general kind and nature as that sold by respondents.

\R. 8. The use by respondents of the aforesaid false, misleading and deceptive statements, representations and practices has had, and no' has, the capacity a.nd tendency to mislead members of the purc.hasing 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' 111erchandise by reason of said erroneous and mistaken beEef.

PAR. 9. The aforesaid acts and practices of respondents, as herein alleged, were and are all to the prejudice and injury of the pubhc and RELIABLE MA. UFACTURING COMPANY ET AL. 1267 126' Decision and Order of respondents' competjtors and constituted Rnclnow constitute, unfair methods of competition in comnlerce and unfair and deceptive acts ncl practices in commerce, in violation of Section 5 of thc Federal 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 Dcceptive Practices proposed to present to the Commission for its consideration and which if issucd 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 compbjnt, a statement that the signing of said agreement is for settlement purposes only and does not constitute an admission by the respondents that the Jaw has been violated as alleged in such complaint, and wnivcrs and provisions as required by the Commission s rules; and The Commission, having reason to believe that the respondents have violated the Federal Tmde Commission Act, and having determined that compla.int should issue stating its charges in that respect hereby issues its complaint, accepts said agreement, makes the following jurisdictional findings, and enters the following order: 1. Respondent Reliable Manufacturing Company is a corporation organized, existing and doing business under and by virtue of the laws of the State of Ilinois, with its offce and principal place business located at 9201 King Street, Franklin Park, Illnois. Respondent Charles W. Leigh is an offcer of said corporation IUd his address is the same as that of said corporation- 2. The Federal Trade Commission has jurisdiction of the subject matter of this proceeding and of the respondents, and the proceeding is in the public interest.

ORDER 1 t ordered That respondents Reliable 1anufactnring Company, H, corporation\ and its officers, and Charles \\T Leigh, :individually and as an offcer of said corporation, and respondents' agents, representatives and employees, directly or through any corporate or other device, in connection with the offering for sale, sale and distribution of electric cooker-fryers or other products, in CODlnerce, as "c01mnerce ,, . ::. 1268 FEDERAL TRADE cO n.nSSIOX DI:CISIOKS COHlIJlaint (i:: F.'l. is clennecl in the Federal Trade Commission Act, do forthwith cease a.nd desist from:

1. Advert.ising, disseminating or distributing any list 131'eticketed or suggested retail price that is not established in good faith as an honest estimatc of the actual retail price or that appreciably exceeds the highest price at which substantiol sales are made in respondents' trade area.

2. Representing that their merchandise is guaranteed unless the nature, extent and conditions of the guarantee, the identity of the guarantor and the manner in which the guarantor wil perform thereunder are dearly set forth in conjunction with the representation of guarantee.

3. Furnishing any distributor, dealer or retailer wit.h any means whereby to deceive the purchasing public in the manner forbidden by the above provisions of this order. It is fUJtheT 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