Famous Wool Corp

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IN THE MATTER OF FAMOUS WOOL CORP., ET AL.

CONSENT ORDER, ETC. , II\ REGARD TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSION AND THE WOOL PRODUCTS LABELING ACTS Docket C-1625. Complaint, Nov. 17, 1969-Decision, Nov. , 1969 Consent order requiring a New York City manufacturer of wool batting ma terials for use in interlining materials to cease misbranding and falsely invoicing its wool products.

COMPLAINT Pursuant to the 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 Famous Wool Corp., a corporation, and Harry Fram and Leon Holz, individually and as officers of said corporation, hereinafter referred to as respondents have violated the provisions of slid 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 Famous Wool Corp. is a corporation organized, existing and doing business under and by virtue of the laws of the State of New York.

Individual respondents Harry Fram and Leon Holz are offcers of said corporation. They formulate, direct and control the acts practices and policies of the corporate respondent including the acts and practices hereinafter referred to. Respondents are engaged in the manufacture and distribution of wool batting for use in interlining material. Their offce and principal place of business is located at 1225 East 14th Street Brooklyn, C\ ew York.

PAR. 2. Respondents, now and for some time last past, have manufactured for introduction into commerce, introduced into commerce, sold, transported, distributed, delivered for shipment shipped, and offered for sale, in commerce, as "commerce " is de- Complaint 76 F.

fined in said Wool Products Labeling Act of 1939, wool products as "wool product" is defined therein.

PAR. 3. Certain of said wool products were misbranded by the respondents 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 deccptively 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 interlining materials stamped, tagged, labeled, or otherwise identified as containing "90% Reprocessed Wool 10% Other Unknown Repr. Fibers" whereas in truth and in fact, such interlining materials contained substantially different fibers and amounts of TIDers 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 interlining materials with labels on or affxed thereto, which failed to disclose the percentage of the total fiber weight of the said wool product, exclusive of ornamentation not exceeding five per centum 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 weight of such fiber was five per centum or more; and (5) the aggregate of aU other fibers. PAR. 5. 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 constitue, unfair methods of competition and unfair and deceptive acts and practices in commerce within the intent and meaning of the Federal Trade Commission Act.

PAR. 6. Respondents now and for some time last past have been engaged in the advertising, offering for sale, sale and distribution of products, namely interlining materials, to garment manufacturer' s in commerce. The respondents maintain and at alj times lY,entioned herein have maintained a substantial course of trade FAMOUS WOOL CORP. , ET AL. 609 607 Complaint in said products in commerce as "commerce" is defined in the Federal Trade Commission Act.

PAR. 7. Respondents in the course and conduct of their business as aforesaid, have made statements on their invoices and shipping memoranda to their customers misrepresenting the character and amount of the constituent fibers present in such products. Among such statements, but not limited thereto, were statements on invoices setting forth certain interlining material as "90/10 Wool" thereby representing the material to contain 90% wool and 10% other fibers whereas, in truth and in fact, the said product contained substantially different fibers and amounts of fibers than were represented.

PAR. 8. The acts and practices of the respondents set out in Paragraphs Six and Seven have had, and now have, the tendency and capacity to mislead and deceive purchasers of said products as to the true content thereof and to cause them to misbrand products manufactured by them in which said materials are used. PAR. 9. 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 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 contajning 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 settement purposes only and does not constitute an admission by respondents that the law has been vio- Decision and Order 76 F.

lated 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 agrecment 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 Famous Wool Corp. is a corporation organized existing and doing business under and by virtue of the laws of the State of ew York, with its offce and principal place of business located at 1225 East 14th Street, Brooklyn, New York. Respondents Harry Fram and Leon Holz are offcers of said corporation. They formulate, direct and control the policies, acts and practices of said corporation. Their address is the same as that of the 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 Famous Wool Corp., a corporation, and its offcers, and Harry Fram and Leon Holz, individually and as offcers of said corporation, and respondents' representatives, agents and employees, directly or through any corporate or other device, in connection with the manufacture for introduction into commerce, the introduction into commerce or the 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 Wool Products Labeling Act of 1939, do forthwith cease and desist from misbranding wool products by:

1. Falsely and deceptively stamping, tagging, labeling, or otherwise identifying such products as to the character or amount of the constituent fibers contained therein. 2. Failing to securely affx to, or place on, each such product a stamp, tag. label, OJ' other means of identification show- FAMOUS WOOL CORP. , ET AL. 611 607 Decision and Order ing 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.

It is fUTtheT Qj-dered That respondents Famous Wool Corp., a corporation, and its offcers, and Harry Fram and Leon Holz, individually and as offcers of said corporation, and respondents representatives, agents and employees, directly or through any corporate or other device, in connection with the advertising, offering for sale, sale or distribution of wool batting materials or other products, in commerce, as "commerce" is defined in the Federal Trade Commission Act, do forthwith cease and desist from misrepresenting the character or amount of the constituent fibers contained in such products on invoices or shipping memoranda applicable thereto, or in any other manner. It is fUTtheT ordered That respondents notify the Commission at least 30 days prior to any proposed change in the corporate respondent such as dissolution, assignment or sale resulting in the emergence of a successor corporation, the creation or dissolution of subsidiaries or any other change in the corporation which may affect compliance obligations arising out of the order. It is fUTtheT ordered That the respondent corporation shall forthwith distribute a copy of this order to each of its operating divisions.

It is fUTtheT 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 and form in which they have complied with this order.