Permalum Products Company et al.

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

IN THE 1\L1. TTER OF PER,1\iA.LF~I PRODUCTS CO)IPANY ET AL.

CONSENT ORDER , ETC., IX REGARD TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE COJ\BIISSION ACT Docket C-1J11. C'0!11plaint, JIM. 1965-Dccision, Jlal', , 1968 Consent. order requiring a home improvelllent concern located in Atlanta, Ga" to cease using bait advertising, false pricing and savings claillls, misrepresenting that customers' property will be used as model hollles, and neglecting to disclose all the details of negotiable papers signed by customers, CO~\IPLAINT Pursuant to the, provisions of the Federal Trade. Commission and by virtue of the authority ,'ested in it by said Act, the Federal Trade Commission, having reason to believe that Perm alum Products Company) , a, corporation, and Leonard ~Ion'is, individually and as an officer of said corporation, hereinafter referred to as respondents, have violated the provisions of said Act, and it appearing to the Commission that n. proceeding by it in respect the.reof would be in the. public interest, hereby issues its complaint stating its charges in that respect .-,collufol.I \lL\GRAPH 1. Permalum Products Company, is a corporation 01'i~'nnizec1. existing and doillQ.' business under and by virtue of the laws of the State aT Georgia~ with its principal office and place of business located at 084 Spring Street, X",V., Atlanta, Georgia. Leonard ::\Iorris is an offcer of the corporate respondent. He. formulates, directs and controls the acts and practices of the corporate respondent, including the acts and practices hereinafter set forth. I-lis address is the same as that of said corporation. m. ::, Respondents are now, and for some time. hst past have been. enQ' ag:ed in the oft'erinQ' for sale. sale. distribution and installation of yarious items of merchandise. for installation in 01' on private homes inc lueling aluminum siding.

\R. 3. In the course and conduct. of their business, respondents no,y cause, and for some time last past ha '-e caused, their said products. hen s()lc1 ~ to be shipped from their place of business in the State of GeorQ'ia. to nurchasers thereof located in yarious other States of the 'Cniteel States, and maintain, and at all time,s mentioned herein have maintajned, a substantial course of trade. in said products in commerce ns "commerce." is defined in the Federal Trade Commission Act. :\.

492 FEDERAL TRADE CO:Ml\IISSIO~ DECISIONS Complaint 73 F, Pall J. In the course and conduct of their business, and for the purpose of inducing the purchase of their products, respondents have made numerous statements and representations in ach-ertising cil'cl1bl's and other promotional material and by oral statements and representations of their salesmen to prospective purchasers respecting the nature of their offer, price, time limitations, quality and free gifts. Typical and illustrative' of the foregoing ad," ertisements, but not an inclnsiye thereof, are the follo"\ving:

8.J f"E on 8PECIJL OPFER:

OF'YER. FOR LDIITED Tnre:

\.LL\lL'\l:JI SIDI::\G ~~.-\.LE:

::\OW O::\LY $2f:JD.OO ::\() EXTIL\S OCR REGt' L.. R PRICE :;:'0Q~:) APPLIES O\'ER .-\.='Y Sl~HFACE WOOD SI-n~GLES, BRICl-\:. S1TCCO (,OJIl'tETELY I::\ST.-\.LLED Incluc1e~: lnLJOl' and material for any aY8rage size home up to 1000 square feet. PAR. 5. By and through the use of the aforesaid statements and representations, and others of similar import and meaning but. not specifically set out herein, and through ora 1 statements made by their salesmen and representatives, lespondents represent, and hate repr2sented, directly or by implication, that:

1. The after set forth in said advertisement is a bona fide offer to sell said siding material of the kind therein described at the prices and on the. terms and conditions stated.

2. The offer set forth in said advertisement is for a limited time only.

3. Respondents' products are being offe,rec1 for sa Ie at a special 01' reduced price and that savings are thereby afforded purchasers from respondents: regular selling price.

4. The homes of prospecti ,"e purchasers have been specially selected as model homes for the installation of respondents' siding, and that after installation such homes ,,-ill be used as points of reference for demonstration and advertising purposes by the respondents, and that as (1. result of allo"\Ying their homes to be used as models, purchasers ,will receive, allo"\yances. discounts. commissions or some other com pensa hon.

5. Respondents' siding materials are 11 new and revolutionary kind of )l' oduct and difl'er substantially from other siding materials available on the market.

. .

PERMALUl\I PRODUCTS CO:i\IPANY EI' AL. 493 491 Complaint G. Respondents' siding materials "\Tillnot require repainting or repail' for the life of the structure on which they are applied. PAR. 6. In truth and in fact 1. The offer set forth above, is not a genuine or bona fide offer but is made for the purpose of obtaining leads as to persons interested in the purchase of respondents' products. After obtainiilg such leads respondents, their salesmen or representatives call upon such persons at. their homes or "\yait upon them at respondents' place of business. At such times and places, respondents, their salesmen or representatives disparage the ach-ertised al111llinlllll sidin~' and otherwise discourage the purchase thereof and attempt to sell. and do sell. different and more expensive aluminum sieling.

. The offer set forth above. is not for a limited time only. Sflid merchanc1i:-;e is ach-ertised regularly at the. represented prices and 011 tlw terms and conditions therein stated.

3. R,esponelents' products are not being offered for sa Ie at a special or reduced price and sa "\-ings are not afforded respondents' customers because of R reduction from respondents' regular selling price. In fact respondents do not have a. regular .selling price but the price,s at "\which respondents' products are sold va.r:)' from customer to customer depending on the resistance of the prospective purchaser. 4. The homes of prospective purchasers are not specially selected as model homes, and respondents do not use purchasers' homes as points of reference for advertising: or demonstration purposes, In addition respondents do not give a 1l0"\yances, discounts, commissions or other compensation to purchasers ,,-ho agree. to hate their homes used as models.

5. Respondents' sieling materials are neither a, ne,v or revolutionary kind of product nor do they substantially ditIer from other sic1i11;~ materials ayailableon the market.

6. Respondents' sieling materals ,viii require. repainting and repair, Therefore, the statements and representations set forth in Para- , graphs Four and Fin' hereof "\,ere, and are, false, misleading p. c1eccpti,- PAR. 7. In the course. and conduct of their business, as aforesaid respondents or their salesmen in a snbstantialnumber of eases fail to disclose orallv at the time of sale and in "\Yritin~' on nIlY conditional sales contract, promissory note. or other instrument executed by the purchasel' , yrith such conspicuousness and eral'ity as is likely to read and observed Ii,\' the. purchaser, that such conditional sales contract, promissory note or other instrument may, at the option of the .... .

494 FEDERAL TRADE CO:\IMISSION DECISIONS Complaint 73 F.

seller and "\without notice to the purchaser, be negotiated or assigned to ,1 finance company or other third party and that if such negotiation or fl8signment is eil'ected, the purchaser ,vill then o,ye the amount due under the contract to the finance company or third party and may have to Dav this amount in full "\vhether or not he has claims against the ~eller under the contract for defects in the merchandise. nondelivery or the like.

The aforesaid failure of the respondents or their representatives reveal ~aic1 facts to purchasers has the tendency and c.apacity to lead and induce a substantial number of such persons into the nnd,~rstanding and belief that the respondents will not negotiate or transfer such documents, as aforesaid, and that legal obligations and relation~hips "\will e,exist only betlveen such respondents and purchasers and "\will remain unchanged and unaltered, and has the tendeney nnd capacity induce a, substantial number of such persons to enter into contracts or execute promissory notes for the pnrchase of respondent.:~:. products of "\which fads the Commission takes official notice. In truth and in fact, respondents frequentl~r and in a suhstantial n11lnber of cases and in the usual course of their business sell. transfel' to finance companies or thirdnnd assign said notes and contracts parties so as to bring about the aforementioned changes in legal obligations and relationships.

Therefore, the failure of respondents or their representatives to reveal such facts to prospective purchasers, as aforesaid, was and is an unfair and false, misleading and cleceptiye act and practicp. -\R. 8. In the course of their business and at all times mentioned herein, respondents ' have been in substantial competition, in commerce, ,,"ith corporations, firms and individuals in the sale of aluminum siding and other building materials of the same general kind and nature ,18 those sold by respondents.

PAR. G. The use by respondents of the aforesaid false misleading and deceptive statements, representations and practices has had, and of theand 110"\" has ~ the capacity and tendency to mislead members pm' chasing public into the erroneous and mistaken belief that said1 statements and representations "\"ere and are true and into the purchase of substantial quantities of respondents' products by re~son :=:;nic1 erroneous and mistaken belief.

-\R. 10. The aforesaid acts and practices of respondents ~ as hereinafter alleged, "\,ere and are nil to the prejudice find injury or the public. ::md of respondents competitors and constitutec1~ und noy; constitute unfair rnethoc1s of competition in commerce :l.nc1unfair and clecepti ,- PER:\IALUM PRODUCTS CO:\1P.-\.?\Y ET AL. 405 491 Order acts and practices in commerce, in violation of Section 5 or the Federal Trade Commission Act.

DECISION .lXD ORDER The Federal Trade Commission h(1 ying initiated an investigation of certain acts and practices or the respondents named in the caption hereof, and the respondents having been furnished thereafter "ith a copy of a draft of complaint. "\which the Bureau of Dec.epti "\-e Practices proposed to present to the Commission for its consideration and which if issued by the Commission, "\yollld charge respondents "\,ith 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 bv the respondents of all the jllrisdietional facts set forth in the aforesaid draft of complaint, a statement that the signing of said agrement is for settlement purposes only and does not constitute an achnission by respondents that the law has been violated as alleged insueh complaint and "\waivers and other provisions as required by the Commission Rules; and The Commission having thereafter considered the matter and having determined that it had reason to believe that the respondents have iolated the said Act, and that complaint should issue stating its charges in that respect, and having thereupon acc.epted the. executed consent agreement and placed such agreement on the public. record for a period of thirty (30) days, now in further conformity with the procedure presc.ribecl in S 2.34 (b) of its Rules, the Commission hereby issues its complaint, makes the follo"\ying jurisdictional findings, and enters the follmying order:

1. Respondent Permalum Products Company is a corporation oranized, existing and doing business under and by virtue of the L-l\YS of the State of Georgia, with its office and principal place of business located at 684 Spring Street, X\Y. , .Atlanta, Georgia. Respondent Leonard :~\Iorris is an officer of said corporation and his address is the same as that of said corporation. :2. The Federal Trade Commission has jurisdiction of tb~ subject m;1tter of this nroceedinQ' and of the l'e;;;:nondents. and the Dl'oC'eedinQ: '--' .Lis in the public interest. .L ' OHDEH It is o'i'dered That respondents Permalu111 Products CornpnnYj corporation, and its officers and Leonard :Jlorris: indivic1wl11y and an officer of said Corporation: andl'respondents ' agents. repre:::entatj,- e:~ 496 FEDERAL TRADE CO:MMISSIOX DECISIOKS Order 73 F, and employees: directly or through any corporate or other device, in connection "\with the achertising, offering for sale. sale, distribution or installation of residential aluminum siding or any other products, in commerce: as ;;commerce': is defined in the Federal Trade Commission Act. do fortln"ith cease and desist from:

1. r sing, in any manner, a sales plan: scheme or device "\,herein false, misleading or c1eceptiye statements 01' representations are made in order to obtain lends or prospects for the sale of other merchanchse 01' services.

:2. )'Iaking- representations purporting to offer merchandise for sale "\"hen the purpose of the representation is not to sell the offered merchandise but to obtain leads or prospects for the sa of other merchandise at higher prices.

3. Di~couraging the purchase of or di~:;paraging any merchandise or services "\"which are ach-el'tisec1 or otrel'(~d for sale. ~. Representing: dil'ectJ~- or by implication, tlwt any m8reh(111dise or sen-ices are otIered for sale "\"hen such offer is not a bona, fide oiler to sell such mercJwndise 01' senices. 5. Representing, directly or by implication, that respondents other of products is limited as to time, or in any other manner: Pi' 'ided: llOlcei' ei" That it. shall be a defense in an~! enforcement proceeding instituted hereunder for respondents to establish that any represented limitation as to time or other represented restriction is actually imposed and in good faith adhered to by rerespondents.

6. Representing, directly or by implication, that any price for respondents' products is a special or reduced price unless such price constitutes a significant reduction from an established selling price at 'which such products have been sold in substantial quantities by respondents in the recent regular course of their J 'C;;- 1. ~~::;.

7. jii~Tepl'esenting, in any manner: savings a'i- ailable to purchasers of respondents' products.

S. Representing, directly or by implication, that the home of any of respondents: customers or prospecti,-e customers has been selected as a model hO1l1e to be used for ad ,-ertising purposes or will be used lor advertising purposes.

0. Representing, directly or by implication, that any allowance: discount: commission or other compensation is granted by respondents to purchasers in return for permitting the premises on "\which respondents' products are installed to be used for adyertising purposes.

AL KAUFMAN FURS, INC. , ET AL. 497 491 S:,:lln 1m s 10. Representing, directly or by implication, that l'c:::pondents kinc1 of product, or siding mf1.teri~l.ls are a new 01' re,-olutionary that responclents products differ substanti~l11y from other sieling materials available on the market.

11. Representing that :responclents~ sieling materials \will not require, repainting or repair; or misrepresenting, in any manner the dI-icacy, durability 01' efficiency oJ 1'2sponc1ents products. 1:2. Failing to orally disclose prior to the time of sD-le, and in "Titing all any conditional snlcs contract, promissory note or other' instrument ofinclebtec1ness executed by a purchaser, and to be obselTec1 "\,ith such conspicuousness and clarity as is likely anc1read by sneh Any such instrument fit responc1ellts~ option lInel "\without purchaser, that: notice to the purchaser, rnay be discounted, negotiatec1 01' asto "\which signed to a nnfillce company 01' other third party the purchaser "\,.-ill thereafter be indebted and figainst "\which the purchasel' s chims or c1efelbes ma~c not be available. 13. Failing' to clear~Y f\nd fully reveal disclose and inform CU5tomeI'S of all terms ,1nd C'olldition~; of a sale and of an:,-' installment contract or promissory note or other' instrument to be signed by any customer.

1-4:. Failing to deli'cer n copy of this order to cease and desist to all present ancl future salesmen or other persons engaged in the sale of respondents ~ products or services, and failing to secure from each such salesman or other person ,1, signed statement acknmvlec1ging receipt of said orc1el'. It i8 fu/'their' oi'deJ'cd. That the respondent. corporation shall forth- "\with c1istriblltea copy of this order to each of its operating c1i \-isions. It is fU7't12ei' oi'd(?cd That the respondents herein shall, within sixty (GO) clays after service. upon them of this order. file with the COlll111 18sion a report in "\writing setting forth in c1etail the manner and form in which they have complied "\with this orc1el'. Ix Tile :JL\.TTETI OF AL KA UFjIA:K FrnS: I~C., ET AL, CONSENT Order: ETC.. IX REG"\RD TO Tile ALLEGED VIOLATION OF TI-IE FEDER.\L TR\DE CO)DIIS~IOX ~\XD T11E F'Cn PRODL::"CTS L~\.BELIXG _\.('TS Docket C-131,l, ('rj,ll/plaint Jla/', 22 DiGS-Decision, JIa'r. .22, 19G8 Con~ent order requiring' a :\e\y York City" manufacturing furrier to cease lllis, branding, deceptively illyoicing:, and falsely guaranteeing its fur products. ;

Colllplain t 73 F. T, CO:~\IPLAIXT Pursuant to the provisions of the Federal Trade Commission Act and the Fur Products Labeling ~\.cL and by ,-virtue of the authority vested in it by said ~-\..ets, the Federal Trade Commission, having reason to belim-e that JJ I~aufman Furs, Inc., a corporation, and Albert Kaufman Ltd., a. corporation, and .Albert I~aufman, individually and as an officer of said corporations, hereinafter referred to as respondents, have viol at-eel 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 follo"\ys :

\R.\GK\PH 1. Respondent .AJ Kaufman Furs, Inc., is a corporation onul1lizec1. existing' and doing: business under and bv virtue of the la "\ys of the State of X e"\y York.c. L. Respondent. Albert Kanfmoln, Ltd., is a corporation organized, existing and doing bnsille~;s nIlder ::llld b:,- virtue of the laws of the State of X e"IV York.

Respondent. Albert I~anfman is an officer of both corporate respondents. He formulates. directs and controls the acts, practices and policies of the saiel corporate respondents including those hereinafter set fo1't h.

Respoll(lents are manufacturers and "wholesalers of fur products ,,'itb t their office and principal place of business located at 208 ,~: est 30th Street. X t'1'. York, X ew York.

\I:. :2. Hespondents are nO\"" and for some, time last past have been. n2' a~ec1 in the introduction into commerce. and in the manufacture for innodl1etion into commerce, and in the, sale, advertising, and offeringc ,for sale in commerce, and in the transportation and distribution in comnWTC'e, of fur products; and have manufactured for sale, sold, adertised, offered for sale, transported and distributed fur products "\which have been made in "hole or in part of furs which have been shipped .-md received in commerce, as the terms "eol111l1erce fur and '; fl1r product" are, defined in the Fur Products Labeling Act. \.R. 3. Certain of said fur products "ere misbranded in that the:," "\were. falsely and deceptively labeled, or otherwise falsely or deceptiyely Identified to show that fur contained therein was natural, when in fact Sllch fur "as pointed, bleached, dyed, tip-dyed, or otherwise artificially colored, in ,'violation of Section 4(1) of the Fur Products Labeling Act.

,, ... AL KAUFMAN FURS, INC. , ET AL. 499 497 Complaint PAR. 4. Certain of said fur products "\"ere misbranded in that they ",ete falsely and deceptively labeled or othenyise falsely or deceptively identified "VIith respect to the name or desig11ation of the aninlal or animals that produced the fur from ",which the said fur products had been manufactured, in violation of Section 4 (1) of the Fur Products Labeling Act.

Among suc.h misbranded fur products, but not limited thereto, were fur products label as "Broadtail" thereby implying that the furs contained therein were entitled to the designation "Broadtail Lamb,:' hen in truth and in fact, the furs contained therein "ere not entitled to such designation.

PAR. 5. Certain of said fur products "\were misbranded in that they were not labeled as required under the prm-isions of Seetion 4 (2) of the Fur Products Labeling Act and in the manner and form pre. scribed by the Rules and Regulations promulgated thereunder. Among suc:h misbranded fur products, but not limited thereto, "ere fur products "\"ith labels w.which failed:

1. To shall the true animal name of the fur used in any such fur product.

2. To disclose that the fur contained in the fur products "\"as bleachec1~ dyed, or othenyise artificially colored, ",hen such "as the fact.

3. To sho,,- the name, 01' other identification issued and registered by the Commission, of one or more of the persons who manufactured any such fur product for introduction into commerce, introduced it into COllllnerCe, sold it in COlll1nerce, advertised or offered it for sale in commerce, or transported or distributed it in commerce. 4. To show the country or origin of the imported furs contained in the. fur products.

PAR. 6, Certain of said fur products "ere misbranded in violation of the Fur Products Labeling Act in that they were not labeled in aecordance "ith the Rules and Regulations promulgated thereunder in the following respects:

(a) Information requiredunc1er Section 4 (:2) of the Fur Products Labeling Act and the Rules and Regulations promulgate.d thereunder ""as set forth on labels in abbreviated form, in violation of Rule 4 of said Rules and Regulations.

(b) The term "naturar: was not nsec1 on labels to describe fur products which "ere not pointed, bleached, dyed, tip-dyed, or other'ise a-rt.ific.ially colored. in "\-violation of Rule 19 (g) of said Rules and Regulatjons.

..: . .

500 FEDERAL TRADE COM::.\IISSIO?\ DECISIONS Complaint .3 F, (c) Information required under Section J(':2) of the Fur Products Lab2.line' ~"'-ct an(l the Rules and RE\Q:nlations nromuIQ:atec1 thereunder \yas set forth in hand1'"\Titing on labels, in violation or Rule 29 (b) or saiel Rules and Regulations.

(d) Information required under' Section J (2) of the Fur Products Labeling: ~\ct. and the Ilules and Re!2'ulntions Wol1lulg' ated thereunder "\yns not set forth in the, required sequence, in violation of Rule 30 of said Rules and Regulations.

(e.) Required item numbers "\were not set Iorth on labels, in violation of Rule 40 of said Rules and Regulations. AR. 7. Certain of stlid fur prodl1ct~"3 "\were falsely and c1eceptin~ly in"\-oicetl by the respondellts in that they "\ver2 net invoiced as required by Section ;) (b) (1) or the Fur Products Labeling Act and the Rules and Regulations P:i'011111lgated under' such ..:\ct. \among such falsely and deceptively invoiced fur products, but. not limited thereto, "\yore fur products cQl'ered h~- invoices ,which failed: 1. To sIlo'y the true anjmal name of the fur used in any such rur product.

. To disclose that the fur contained in the. fnr products was bleHchecl dyed. or other,,-ise artificially coJorec1~ when such ,yas the fact. 3. To 8hm\" the country aT origin or imported fur used in any sneh rur product.

\n. S. Certain of saiel fur products ,were falsely and deceptively in,-oiced "\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.

\.Jnollg such falsely and deceptively invoiced fur products, but. not limited thereto, "\were fur products which were in,-oicec1 as ';Broadtail" thereby imp1~'ing t hat the furs contained therein "\were entitled to the desiQ'nation ';Broadtail Lamb," "\"hen, in truth and in ract. furs contained therein ".ere not entitled to such designation. \R. 9. Certain or said rur products "\,ere falsely and decepti,-ely invoiced in violation of the Fur Products Labeling' Act in that they "\were not. invoiced in accordance with the Rules nnd Regulations promulgated thereunder in the rollOlving' respects: (n) Information required under Section ;')(b) (1) of the Fur Products Labeling.' ..:-~C't and the Rules and HegllJations )jl'omnlgated thereunder ,yas set forth on in,' oices in abbreTiatec1 form, in ,-violation of Rule 4: or said Rules and Regulations.

, AL Karl\IAN From ~ r:i',C.~ ET AL. 501 407 Decision and Order (b) The term ';naturar' was not used on in," oices to describe fur products "\which ,were not pointed, bleached, dyed, tip-dyed or at her- ,yiso artific.ially color('d~ in "\'iOlatiOll of Rule ID (g) of saiel 11ules and Regulations.

(c) Required item numbers "\yerc not set forth on inyoic2s, in yiolation of Rule 40 or said Rules and Regulations. m. 10. Respondents furlli~:hed false guaranties that certain of their fur products ,were not misbranded, falsely invoiced or falsely ad,-ertised w.hen respondents in flll'nishin~2" such t:wnranties had reason to believe that fur products so falsely guarantied "\yould be illtroc111ced sold, transported or distributed in commerce, in violation of Section 10 (b) of the Fur Products Labeling Act.

\R. 11. The aforesaid acts and practices of respondents, as herein alJegecl, are in violation of the Fur Products Labeling Act. and the R.ules and Regulations promulgated thereunder and constitute unfair methods of competition and unfair and deceptive acts and practices in commerce under the Federal Trade Commission Act. DECISION AXD ORDER The Federal Trade Commission h a ,-ing initia tecl an in ycstigation 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, ,vould charge respondents ,with violation of the Federal Trade Commission Act and the Fur Products Labelinr~ Act; and The respondents and counsel for the Commission having thereafter executed an agrreement containing~2" fl, consent order, an admission bv the respondents of all the jurisdictional facts set forth in the aforesai(l L,draft of complaint, a statement that the signing of t:aid agreement is for settlement purposes only and does not constitute. an admission by respondents that the la"\\' has been yioInted as alleged in such complaint, and ,yaiyers and other prm-isiolls as required by the Commission s Rules; and The Commission having" thereafter con-=:ic1ered the matter and ha,'in~ determined that it had reason to believe that the. respondents 11f1.l-e yiolated the said .Acts. and that comnlaint..L should issue sbtjllQ' its charg' e:3 in that respect, and having thereupon accepted the executed consent agreement and placed such agreement on the public record for a period of thirty (30) days, no"\"\" in Turther conformity with the procedure ,;; , 502 FEDERAL TRADE CO~lmission DECISIONS Order 73 F.

prescribed in S 2.34 (b) of its Rules, the Commission hereby issues its c.complaint, makes the. following jurisdictional findings, and enters the following order:

1. Respondent Al Ka,ufman Furs, Ine., is a corporation organized existing and doing business under and by virtue of the la\\""s of the State of New York, "ith its office and principal place of business located at 208 ,Yest 30th Street, Xe" York, Xew York. Respondent Albert Kaufman, Ltd., is a corporation organized, existing and doing business under and by virtue of the la,ws of the State of N e.w York, with its office and principal place of business located at :208 ,Vest. 30th Street, N e"\y York, New York. Respondent Albert Kaufman is an officer of said corporations and his address is the same as that of said corporations. 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 It ;8 07'dei' ed. That respondents Al Kaufman Furs, Inc. , a corporc1tion, and its oilicers, and ~-\.albert Kaufman, Ltd., a corporation, and its officers, and Albert Kaufman, indi,-idufLlly and as an officer of said corporfLtions, and respondents' representatives, agent and employee:::, directly or through any corporate or other device, in connection "\,-ith the introduction, or manufacture for introduction, into commerce, or the, sale. advert.ising' or offering' for sale in commerce. or the tran:3portntion or distribution in commerce, of any fur product: or in connection "\with the. manufacture for sale, sale, ad"\'ertising, offering fol' sale, transportation or distribution, of flny fur product "\which is made in "\whole or in part of fur "\which has been shipped and recei,-ed in commerce :1:=; the terms ;;commerce fur" and ;;ful' product': are tlennecl in the Fur Products LfLbelin~r Act. do forth"\with ce:lse and clcsi~t from:

.Ad :JIisbranding any fur product by:

1. Representing, directly or by implication, on n label that the fur contfLinecl in such fur product is natural ,yhen such fur is pointed ~ bleached, dyed, tip- cl~' , or othenyise artiticinllv colored.

2. Falsely or decepti,-ely labeling 01' otherwise Ja1se1y 01' cleceptiyely identifying such fnr product as to the name or designation of the animal OJ' animals that produced the fur contained in the fnr product.

AL KAUFMAN FURS , INC. , ET AL. 503 497 Order 3. Failing to affix a label to such fur product showing in ,"ords and in figures plainly legible all of the information required to be disclosed by each of the subsections of Section 4(2) of the Fur Products Labeling Act.

4. Setting forth information required under Section 4: (:2) of the Fur Products Labeling Act and the Rules and Regallations promulgated thereunder in abbreviated form on a label affixed to such fur product.

5. Failing: to set forth the, term "natural as part of tlu"' information required to be disclosed on a, label under the Fur Products Labeling Act and the Rules and Regulations promulgated thereunder to describe such fur product. yrhich is not pointed, bleached, dyed, tip-dyed~ or otherwise. artificially colored.

6. Setting forth information required under Section 4 (2) of the Fur Products Labeling Act and the Rules and Regulations promulgated thereunder in handwriting on a label affixed to such fur product.

7. Failing to set forth information required under' Section 4: (2) of the Fur Products Labeling .:\..ct and the Rules and Regulation.s promulgated thereunder on a label in the sequence required by Rule 30, of the aforesaid Rllles a 11(1 Regulations.

8. Failing to set forth on a label the item nlUnber or 111,11'1;: assigned to such fur product.

B. Falsely or deceptively invoicing any fur product b~- 1. Failing to furnish an invoice, a8 the term ;;ill\-oice " is defined in the Fur Products Labeling!J: Act. showing' in "' orci~ and figures plainly legible all the information required to be disclosed by each of the. subsections of Section ;) (b) (1) of the Fur Products Labeling Act.

2. Setting forth on an invoice pertaining to such fur product any false or deceptive information "\with respect to the name or designation of the animal or animals that produced the fur conta,ined in such fur product..

3. Setting fo1th information required under Section 5 (b) (1) of the Fur Products Labeling Act and the Rules and Regulations promulgated thereunder in abbreviatecl form.

4. Failing to set forth the term ;' natural" as part of the information required to be disclosed on an invoice. under' the 504 FEDERAL TRADE COMl\IISSIOX DECISIONS Complaint 73 F, T, Fur Products Labeling' Act and Rules and Regnlations nromulgatecl thereunder to describe such fur product which is not. pointed, bleached, d~- , tip-dyed, or otherwise artifically colored.

5. Ffliling to set forth on an invoice the item number or mark assigned to such fur product.

It is fudlzei' oj'dei' That Al Kaufman Ful's, Inc., a corporation and its ofilcers, and ..:\.albert Kanfmflll, Ltd., a corporation, and its officers, and ~\.albert Kaufman, individually and as an officer of said corporations ~ nncl respondents' representati-n~s, agents and employees directly 01' through any corporate or other device, do fortln\ith cease flnd desist nom furnishing ,1 false guaranty that any fur proc1net is 01' falselv advertised \yhen the re-not misbrallcled. falsely in,"oiced spondents ha\"e reason to be1ien~ that such fur product may be introdl1cect sold, transported, or distriLmtec1 in commerce. It is judhei' ordered That the respondent corporations shall Iorth- \With distribute a copy or this order to each or their operating di \"isions. t is ill dhei' old acd That the respondents herein shall, "\within sixty , file .with the Commis-(60) days after service, upon them of this order sion a report in \,Titing set.ting forth in detail the manner and form in "\,which they have complied "\with this order. Ix THE J\L-\TTER OF DARIO OF ITALY, IXC., ET AL.

COXSEXT GIlDER, ETc., IX REGARD TO THE ALLEGED VIOLATION OF TI-lE FEDERAL TRADE CO)DIISSIOX AXD THE .\VOOL PROD"GCTS LABELING ACTS J1ar. 26, 1968 Docket C-1313, Complaint, Jlar. 1965-Dccision c1istributor of lac1iesConsent orcler requiring a Miami, Fla" importer and slyeaters and hats to cease lllbbranc1ing its Iyooll1roc1ucts. CO i\IPLA IXI' Pursuant to the Droyisions of the Federal Trade Commission Act and the ,V 001 Products Labeling.. ..:-\..ct of 19;39. and by yirtl1e of the fiuthority ,~ested in it by sfiid Acts, the Federal Trade Commission having n~nson to believe that Dario of Italy, Inc., a corporation, find Carl Gooc1kin. indi\~idual1y nnd as an officer of said corporation. hereinaItel' referred to as respondents, have violated the provisions of sai(l ):,: .\ \ DARIO OF ITALY. I:\'"C.. ET AL. 505 ::-'0- Colllplaint Acts and the Rules and Regulations promulgated under the \Y 001 Products Labeling Act of 1930, and it appearing: to the Commission that a proceeding by it in respect thereof "\yould be in the public interest, hereby issues its complaint stating its charges in t11M respect a~ follo,,- \RAGlU.PH 1. Respondent lhrio of Italy, Inc., is a corporation 01'- J2",mized, existing and doing business under and by yirtne of the la \Y3 of the Sta te. or Inorida.

Individual respondent Carl Goodkin is an officer of said corporation. He formulates, directs and controls the acts, practices and policies of the corporate respondent including the acts and practices hereinafter referred to.

Hespondents are engaged in importing and distributing ladies' wool l.Jlend s"\yeaters and hats. Sales are made. to retail stores located throughout the rnited States. Their office and principal place of business located at G7-rE~ KE.~ Fourth . enue. :Miami~ Florida. They also Inaintain a plac(' of business where the imported products are recei,-ecl ,11lc1 distributed to yarious customers throughout the United States. The. address of this place of business is :2;') Buena Vista A yen He, La ,,renee, L. , New York.

PAR. :2. Respondents, now and for some time last past, have introduced into commerce, sold, transported, distributed, deli"\-ered for shipment, shipped and offered for sale, in commerce, as ;' commerce is defined in said \Vool Products Labeling .. ct of 19;~~9, wool products Its ;'wool product" is defined therein.

m. 8. Certain of said "\yool products "-ere misbranded by the l'espondents "\within the intent and meaning of Section ':1: (a) (1) of the \Y 001 Products Labeling ~ c.t of H);19 and the Rules and Regulations promulgated thereunder, in that they "'ere falsely and deceptively ~tamped, tagged, labeled, or othenyise identified "\with respect to the character and amount of the constituent fibers ('contained therein. -\.among such misbranded "\yool products, but not limited thereto "\"ere "\yool blend s"\Yeatel'S stamped, tagged, labeled, or otherwise identified as containing ;' SOJ0 "\'"001 , 10j~ mohair, 10~:'~ llyloll ~ whereas truth and in fact, such ~m-eaters containell substantially different fibers and amounts of fibers thallrepre~(,lltel1. \H. -1. Ce~:tain of ~:aic1 "\yool products "\were further misbranded by respondents in that they were not stamped, tagged, JnbeJ('cl. or other- \yise. identified as requiredllnder the pro\- isions of Section J (a) (:2) of the ,Y 001 Products Labeling Act of IDED and in the manner and form as prescribed by the Rules and Regulations promuJgatec1 under said A C' 1. 418-::4::;-72- Decision ~nd Order 73 F.

Among such misbranded wool products, but not limited thereto "ere wool blend sweaters with labels on or affixed thereto, "which failed to elise-lose the percentage of the total fiber weight of the saiel wool product, exclusive of ornamentation not exceeding 5 per centlU11 of said total fiber weight of (1) wool fibers; (2) reprocessed wool; (3) reused wool; (4) each fiber other than wool when said percentage by ",eight of such fiber was 5 per centum or more; and (5) the aggregate of all other fibers.

PAR. 5. Certain of said wool products were misbranded in violation of the ,iT 001 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" "",as used in lieu of the word wooF' in setting forth the required fiber content information on labels affixed to ,,-001 products without setting forth the correct percentage of the mohair, in violation of Rule 19 of the Rules and Regulations under the ,Y 001 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 ,Y 001 Products Labeling Act of 1930 and the Rules and Regulations promulgated thereunder, and constituted, and now constitute, unfair methods of competition and unfair and deceptive acts and practices in commerce, within the intent and meaning of the Federal Trade Commission Act. DECISION AND ORDER The Fe,deral 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 ,V 001 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 respondents that the law has been violated as alleged in such complaint, and ,,-waivers and other provisions as required by the Commission s Rules; and The Commission having the.reafter considered the matter and having determined that it had reason to believe that the respondents have DARIO OF ITALY, INC. , ET AL. 507 50'4 Order violated the said Acts, and that complaint should issue stating its charges in that respect, and having thereupon accepted the executed consent a.gremnent and placed such agreement on the public record for a period of thirty (30) days, now in further conformity with the procedure prescribed in S 2.34(b) of its Rules, the Commission hereby issues its complaint, nlakes the following jurisdictional findings, and enters the following order:

1. Respondent Daria of Italy, Inc., is a corporation organized existing and doing business under and by virtue of the laws of the State of Florida, with its office and principal place of business located at 67-52 NE., Fourth Avenue, J\Iiami, Florida. Respondent Carl Goodkin is an officer of said corporation and 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 It is ordered That respondents Dario of Italy, Inc., a corporation and its officers, and Carl Goodkin, individually and as an officer of said corporation, and respondents' representatives, ~gents and e111ployee.s, directly or through any corporate or other device, in connection with the manufacture for introduction into commel, introduction into commerce, or offering for sale, sale, transportation, distribution delivery for ' shipment or shipment, in commerce, of wool products .as "commerce" and "wool product" are defined in the ,Y 001 Products Labeling wool Act of 1939,productsdo forthwith cease and desistbyfrom misbranding: 1. Falsely and deceptively stamping, tagging, labeling, or otherwise identifying such products fts to the character or amount of the eonstituent fibers contained therein.

2. Failing to securely affix to or place on, each such product a stamp, tag, label, or other means of identification showing in clear and conspicuous manner each element of information required to be disclosed by Sedion 4 (a.) (2) of the ,\Tool Products La-beling Ad of 3. Using the term ';moha-ir': in lieu of the .word "wool" in setting. 1939. forth the required fiber content information on labels affixed to wool products without setting forth the correct percentage of the mohair present.

It is f1.lithe7' o'i'de'i'ecl That the respondent corporation shall forthwith distribute a copy ()f this order to each of its operating divisions. , , Comliln illt 73 F, J t is further Older' That the respondents herein sha 11, ". it.hin sixty (60) clays after service upon them of this order, file ,,'ith the Commission it report in \writing setting forth in detail the manner and form in which they have c.complied with this order.