A. & M. Karagheusian, Inc.

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

IN THE MATTER OF A. & M. KARAGHEUSIAN, INC.

ORDER, ETC,, IN REGARD TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSION ACT Docket 4305. Complaint, Sept. 6, 1940—Decision, Sept. 13, 1965 Order reopening a proceeding against a New York City rug company, 36 F.T.C, 446, dated March 29, 1943, vacating the order and terminating the case. ORDER GRANTING REQUEST TO REOPEN PROCEEDING AND VACATING ORDER TO CEASE AND DESIST By order of March 25, 1965, the Commission directed respondent, A. & M. Karagheusian, Inc. (Karagheusian), to show cause why A, & M, KARAGHEUSIAN, INC, 453 452 Order this proceeding should not be reopened and the order to cease and desist issued herein on March 29, 1943 [86 F.T.C. 446], modified because of certain changed conditions of fact. An answer to this order was filed by counsel for J. P. Stevens & Co., Inc. (Stevens). Included in this answer was a petition filed pursuant to § 8.28(b) (2) of the Commission’s Rules of Practice requesting reopening of the proceeding for the purpose of setting aside the order to cease and desist. The grounds for this request, among others, given by counsel are that the corporate existence of Karagheusian has been terminated and that Stevens as the successor to that corporation is not bound by the order to cease and desist.

The petition states that Stevens, a publicly held corporation, acquired all the stock of Karagheusian in an arm’s length transaction on Februarv 18, 1964, and that Karagheusian existed as a corporate subsidiary of Stevens until February 1, 1965, when it was dissolved by merger into Stevens. The petition further states that the separate existence of Karagheusian as a subsidiary corporation was terminated for bona fide business reasons and without reference to or consideration of the order in this proceeding. The Director of the Bureau of Deceptive Practices has not opposed this petition, and the Commission has no reason to believe that the acquisition of Karagheusian by Stevens was made for the purpose of evading the order to cease and desist or that Stevens has participated with Karagheusian in violation of the order or that there is such relationship or continuity of interest between Karagheusian and Stevens as to warrant treating the latter as a successor respondent. On the basis of the information presented, the Commission is of the opinion that Stevens is not bound by the order to cease and desist issued against the respondent corporation and that the dissolution of the respondent corporation constitutes a changed condition of fact which warrants reopening of this proceeding for the purpose of setting aside the order to cease and desist. Accordingly, It is ordered, That this proceeding be, and it hereby is, reopened. It is further ordered, That the Commission’s order to cease and desist issued in this proceeding on March 29, 1948 [36 F.T.C. 446], be, and it hereby is, vacated and the proceeding terminated. Complaint 68 E.T.C.