Glencoe Carpet Mills, Inc., et al.

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Docket C-1445. Complaint, Nov. 4, 1968-Decision, Nov. 4, 1968 Consent order requiring a Burlington, North Carolina, carpet manufacturer to cease misbranding, falsely advertising and guaranteeing its textile fiber products, and failing to keep required records. COMPLAINT Pursuant to the provisions of the Federal Trade Commission Act and the Textile Yiber Products Identification Act, and by virtue of the authority vested in it by said Acts, the Federal Trade Commission, having reason to believe that Glencoe Carpet Mils, Inc., a corporation, and Clarence R. Shepherd, individually and as an offcer of said corporation, hereinafter referred to as respondents, have violated the provisions of said Acts and the Rules and Regulations promulgated under the Textile Fiber Products Identification 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:

PARAGRAPH 1. Respondent Glencoe Carpet Mils, Inc. , is a corporation organized, existing and doing business under and by virtue of the laws of the State of Xorth Carolina. Respondent Clarence R. Shepherd is an offcer of said corporate respondent. He formulates, directs and controls the acts, practices and policies hereinafter set forth.

Respondents are engaged in the manufacture and sale of textile fiber products including floor coverings, with their offce and principal place of business located on Route 1, Burlington, North Carolina. Respondents' mailing address is Post Offce Box 567 Route 1, Burlington, North Carolina.

PAR. 2. Respondents are now and for some time last past have been engaged in the introduction, delivery for introduction manufacture for introduction, sale, advertising, and offering for sale, in commerce, and in the transportation or causing to be transported in commerce, and in the importation into the United States, of textile fiber products; and have sold, offered for sale advertised, delivered, transported and caused to be transported, textile fiber products, which have been advertised or offered for sale in commerce; and have sold, offered for sale, advertised delivered, transported and caused to be transported, after shipment in commerce, textile fiber products, either in their original state or contained in other textile fiber products; as the terms commerce" and "textile fiber product" are defined in the Textile Fiber Products Identification Act.

1162 FEDERAL TRADE COMMISSION DECISIOKS Complaint 74 F.

PAR. 3. Certain of said textile fiber products were misbranded by respondents in that they were not stamped, tagged, labeled or otherwise identified to show each element of information required to be disclosed by Section 4 (b) of the Textie Fiber Products Identification Act, and .in the manner and form as prescribed by the Rules and Regulations promulgated under said Act.

Among such textile fiber products, but not limited thereto, were numerous rolls of carpeting which contained no labels. PAR. 4. Certain of said textile fiber products were misbranded in violation of the Textile Fiber Products Identification Act in that they were not labeled in accordance with the Rules and Regulations promulgated thereunder in that in disclosing the required fiber content information as to ftoor coverings containing exempted backings, fillings, or paddings, such disclosure was not made in such a manner as to indicate that such required fiber content information related only to the face, pile or outer surface of the ftoor covering and not to the backing, filling or padding, in violation of Rule 11 of the aforesaid Rules and Regulations.

PAR. 5. Certain of said textile fiber products were falsely and deceptively advertised in that respondents in making disclosure or implications as to the fiber content of such textile fiber products in written advertisements used to aid, promote and to assist, directly or indirectly, in the sale or offering for sale of said products, failed to set forth the required information as to fiber content as specified by Section 4 (c) of the Textie Fiber Products Identification Act and in the manner and form prescribed by the Rules and Regulations promulgated under said Act. Among such textile fiber products, but not limited thereto, were carpets which were falsely and deceptively advertised by means of printed matter, in price list form, distributed by the respondents throughout the L'united States to customers and salesmen. The aforementioned carpets were described by such fiber cannoting terms among which, but not limited thereto was "acrilan and the true generic name of the fiber contained in such products was not set forth.

PAR. 6. By means of the aforesaid advertisements and others of similar import and meaning not specifically referred to herein respondents have falsely and deceptively advertised textile fiber products in violation of the Textile Fiber Products Identification Act in that said textile fiber products were not advertised in accordance with the Rules and Regulations promulgated there- GLENCOE CARPET MILLS , INC., ET AL. 1163 1160 Decision and Order under in the following respects:

(a) In disclosing the fiber content information as to floor coverings containing exempted backings, fillings, or paddings, such disclosure was not made in such a manner as to indicate that such fiber content information related only to the face, pile or outer surface of the floor covering and not to the backing, filling or padding, in violation of Rule 11 of the aforesaid Rules and Regulations.

(b) A fiber trademark was used in advertising textie fiber products, without a full disclosure of the fiber content information required by said Act, and the Regulations thereunder in at least one instance in said advertisement, in violation of Rule 41 (a) of the aforesaid Rules and Regulations. (c) Fiber trademarks were used in advertising textie fiber products, containing more than one fiber, other than permissive ornamentation, and such fiber trademarks did not appear in the required fiber content information in immediate proximity and conjunction with the generic name of the fiber in plainly legible type or lettering of equal size and conspicuousness, in violation of Rule 41 (b) of the aforesaid Rules and Regulations. PAR. 7. Respondents have failed to maintain proper records showing the fiber content of the textie fiber products manufactured by them, in violation of Section 6 of the Textile Fiber Products Identification Act and Rule 39 of the Regulations promulgated thereunder.

PAR. 8. Respondents have furnished their customers with false guaranties that certain of the textile fiber products were not misbranded or falsely invoiced by falsely representing in writing on invoices that respondents have filed a continuing guaranty under the Textie Fiber Products Identification Act with the Federal Trade Commission, in violation of Rule 38 (d) of the Rules and Regulations under said Act and Section 10 (b) of such Act. PAR. 9. The acts and practices of respondents, as set forth above, were and are in violation of the Textile Fiber Products Identification Act and the Rules and Regulations promulgated thereunder and constituted and now constitute unfair methods of competition and unfair and deceptive acts or practices, in commerce, under the Federal Trade Commission Act. DECISION AND ORDER The Federal Trade Commisson having initiated an investigation of certain acts and practices of the respondents named in 1164 FEDERAL TRADE COM MISSION DECISIONS Decision and Order 74 F.

the caption hereof, and the respondents having been furnished thereafter with a copy of a draft of complaint which the Bureau of Texties 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 Textile Fiber Products Identification Act; and The respondents and counsel for the Commission having thereafter executed an agreement containing a consent order, an admission by the respondents of alj 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 thereafter considered the matter and having determined that it had reason to believe that the respondents have violated the said Acts, and that complaint should issue stating its charges 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, now in further conformity with the procedure prescribed in 34 (b) of its Rules, the Commission hereby issues its complaint, makes the following jurisdictional findings, and enters the following order: 1. Respondent Glencoe Carpet Mils, Inc. , is a corporation organized, existing and doing business under and by virtue of the laws of the State of North Carolina, with its principal place of business located on Route 1 , Burlington, North Carolina. Respondent' s mailing address is Post Offce Box 567, Route 1 Burlington, North Carolina.

Respondent Clarence R. Shepherd is an offcer 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 pu blic interest. ORDER It is ordered That respondents Glencoe Carpet 1Iils, Inc. , a corporation, and its offcers, and Clarence R. Shepherd, individually and as an offcer of said corporation, and respondents' representatives, agents and employees, directly or through any corporate or other device, in connection with the introduction, sale advertising, or offering for sale, in commerce, or the transporta- GLENCOE CARPET MILLS, INC. , ET AL. 1165 1160 Order tion or causing to be transported in commerce, or the importation into the United States of any textile fiber product) or in connection with the sale, offering for sale, advertising, delivery, transportation or causing to be transported, of any textie fiber product which has been advertised or offered for sale, in commerce; tising, delivery, transportation, or causing to be transported after shipment in commerce, of any textile fiber product, whether in its original state or contained in other textie fiber products as the terms "commerce" and "textile fiber product" are defined in the Textile Fiber Products Identification Act, do forthwith cease and desist from:

A. Misbranding textile fiber products by: 1. Failing to affx a stamp, tag, label, or other means of identification to each such product showing in a clear, legible and conspicuous manner each element of information required to be disclosed by Section 4 (b) of the Textie Fiber Products Identification Act. 2. Failing to disclose on labels the required fiber content information as to floor coverings containing exempted backings, fillings, or paddings, in such manner as to indicate that it relates only to the face, pile, or outer surface of the floor covering and not to the exempted backing, fillng or padding.

B. Falsely and deceptively advertising textile fiber products by:

1. Making any representations, by disclosure or by implication, as to fiber content of any textile fiber product in any written advertisement which is used to aid, promote or assist, directly or indirectly, in the sale, or offe ing for sale of such textile fiber product unless the same information required to be shown on the stamp, tag, label or other means of identification under Sections 4(b) (1) and (2) of the Textile Fiber Products Identification Act is contained in the said advertisement, except that the percentages of the fibers present in the textie fiber product need not be stated. 2. Failing to set forth in disclosing fiber content information as to floor coverings containing exempted backings, fillings or paddings, that such disclosure relates only to the face, pile or outer surface of such textile 1166 FEDERAL TRADE COMMISSIOK DECISIONS Syllabus 74 F.

fiber products and not to the exempted backings, fillings or pad dings.

3. Using a fiber trademark in advertising textie fiber products without a full disclosure of the required fiber content information in at least one instance in said advertisement.

4. Vsing a fiber trademark in advertising textile fiber products containing more than one fiber without such fiber trademark appearing in the required fiber content information in immediate proximity and conjunction with the generic name of the fiber in plainly legible type or lettering of equal size and conspicuousness. C. Failing to maintain and preserve proper records showing the fiber content of the textile fiber products manufactured by said respondents, as required by Section 6 of the Textile Fiber Products Identification Act and Rule 39 of the Regulations promulgated thereunder.

It is further o?'dered That respondents Glencoe Carpet Mils Inc. , a corporation, and its offcers, and Clarence R. Shepherd individually and as an offcer of said corporation, and respondents representatives, agents and employees, directly or through any corporate or other device, do forthwith cease and desist from furnishing a false guaranty that any textile fiber product is not misbranded or falsely invoiced under the provisions of the Textile Fiber Products Identification Act.

It is fw.ther ordered That the respondent corporation shall forthwith distribute a copy of this order to each of its operating divisions.

It is further Q1'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.