Leroy Knitted Sportswear, Inc.

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IN THE MATTER OF LEROY KNITTED SPORTSWEAR, INC., ET AL.

CONSENT ORDER, ETC. , IN REGARD TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSION AND THE WOOL PRODUCTS LABELING ACTS Docket C-l067. Complaint, May 1966-Decision May 17, 1966 Consent order requiring a Los Angeles Calif. , manufacturer, importer and jobber of wool products to cease misbranding wool sweaters and other wool products.

COMPLAINT Pursuant to provisions of the Federal Trade Commission Act and the Wool Products Labeling Act of 1939, and by virtue of the authority vested in it by said Acts, the Federal Trade Commission having reason to believe that Leroy Knitted Sportswear, Inc. , a corporation, and Samuel Scharf, Leon Scharf and Roy Scharf individually and as offcers of said corporation hereinafter referred to as respondents, have violated the provisions of said Acts and the Rules and Regulations promulgated under the Wool Products Labeling Act of 1939, 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. Respondent Leroy Knitted Sportswear, Inc., is a corporation organized, existing and doing business under and by virtue of the laws of the State of California. Individual respondents Samuel Scharf, Leon Scharf, and Roy Scharf are offcers of said corporation and cooperate in formulat- Complaint 69 F, ing, directing, and controllng the acts, policies and practices of the corporate respondent including the acts and practices hereinafter referred to.

Respondents are manufacturers, importers, and jobbers of wool products with their offce and principal place of business located at 1245 South Hope Street, Los Angeles, California, PAR. 2. Subsequent to the effective date of the Wool Products Labeling Act of 1939, respondents have introduced into commerce, sold, transported, distributed, delivered for shipment shipped and offered for sale in commerce, as "commerce" is defined in said Act, wool products as "wool product" is defined therein.

PAR. 3. Certain of said wool products were misbranded within the intent and meaning of Section 4 (a) (1) of the Wool Products Labeling Act of 1939 and the Rules and Regulations promulgated thereunder, in that they were falsely and deceptively stamped tagged, labeled or otherwise identified with respect to the character and amount of the constituent fibers contained therein. Among such misbranded wool products, but not limited thereto were sweaters stamped, tagged, labeled or otherwise identified as containing 89 % 2Vohair, 11 rc Nylon, whereas in truth and in fact, such sweaters contained substantially different amounts of fibers than represented.

PAR. 4. Certain of said wool products were further misbranded by respondents in that they were not stamped, tagged, labeled or otherwise identified as required under the provisions of Section 4(a) (2) of the Wool Products Labeling Act of 1939 and in the manner and form as prescribed by the Rules and Regulations promulgated under said Act.

Among such misbranded wool products, but not limited thereto were certain sweaters with labels on or affxed thereto, which failed to disclose the percentage of the total fiber weight of the wool product, exclusive of ornamentation, not exceeding 5 per centum of said total fiber weight of, (1) woolen fibers; (2) each fiber other than wool if said percentage by weight of such fiber is 5 per centum or more; (3) the aggregate of all other fibers. PAR. 5. Certain of said wool products were misbranded in violation of the Wool Products Labeling Act of 1939 in that they were not labeled in accordance with the Rules and Regulations promulgated thereunder, in that the term "Mohair" was used in lieu of the word "Wool" in setting forth the required fiber content information on labels affxed to wool products when certain of the LEROY KNITTED SPORTSWEAR, INC" ET AL. 749 747 Decision and Order fibers described as "Mohair" were not entitled to such designation, in violation of Rule 19 of the Rules and Regulations under the Wool Products Labeling Act of 1939.

PAR. 6, The acts and practices of the respondents as set forth above were, and are in violation of the Wool Products Labeling Act of 1939 and the Rules and Regulations promulgated thereunder, and constituted, and now constitute, unfair and deceptive acts and practices and unfair methods of competition in commerce, within the intent and meaning of the 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 Textiles and Furs 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 Wool Products Labeling Act of 1939; 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 violated as alleged in such complaint, and waivers and provisions as required by the Commission s rules; and The Commission, having reason to believe that the respondents have violated said Acts, and having determined that complaint 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 Leroy Knitted Sportswear, Inc., is a corporation organized, existing and doing business under and by virtue of the laws of the State of California with its offce and principal place of business located at 1245 South Hope Street, Los Angeles, California.

Respondents Samuel Scharf, Leon Scharf, and Roy SchD,rf are offcers of said corporation and their offce and principal place of business is the same as that of said corporation. 2, The Federal Trade Commission has jurisdiction of the sub- Syllabus 69 F.

ject matter of this proceeding and of the respondents, and the proceeding is in the public interest.

ORDER It is ordered That respondents Leroy Knitted Sportswear Inc. , a corporation, and its offcers, and Samuel Scharf, Leon Scharf, and Roy Scharf, individually and as offcers of said corporation, and respondents' representatives, agents and employees directly or through any corporate or other device, do forthwith cease and desist from introducing into commerce, or offering for sale, selling, transporting, distributing or delivering for shipment in commerce, wool sweaters or any other wool products, as "commerce" and "wool product" are defined in the Wool Products Labeling Act of 1939:

1. Which are falsely or deceptively stamped, tagged, labeled or otherwise identified as to the character or amount of the constituent fibers contained therein. 2, Unless each of such products has securely affxed there- , or placed thereon, a stamp, tag, label or other means of identification correctly showing in a clear and conspicuous manner each element of information required to be disclosed by Section 4 (a) (2) of the Wool Products Labeling Act of 1939.

3. To which is affxed a label wherein the term "Mohair is used in lieu of the word "Wool" in setting forth the required information on labels affxed to such wool products unless the fibers described as "Mohair" are entitled to such designation and are present in at least the amount stated. It is fU1.ther o1'dered 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 in which they have complied with this order.