Royal Mist, LTD

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In ter Matter or ROYAL MIST, LTD., ET AL.

CONSENT ORDER, ETC., IN REGARD TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSION AND THE WOOL PRODUCTS LABELING ACTS Docket C-1715. Complaint, Mar. 26, 1970—Decision, Mar. 26, 1970 Consent order requiring a New York City manufacturer of women’s and misses’ apparel to cease misbranding and falsely guaranteeing its wool products.

ComMPLaInT 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 Royal, Mist Ltd., a corporation, and Philip Epstein, individually and as an officer 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 interests, hereby issues its complaint stating its charges in that respect as follows: - Paracrary 1. Respondent Royal Mist, Ltd., is a corporation organized, existing and doing business under and by virtue of the laws Complaint V7 F.T.C.

of the State of New York with its office and principal place of business located at 512 Seventh Avenue, New York, New York. Respondent Philip Epstein is an officer of said corporation. He formulates, directs and controls the policies, acts and practices of said corporation, and his address is the same as that of the corporate respondent.

Respondents are engaged in the manufacture and sale of women’s and misses’ apparel. They ship and distribute such products to various customers in the United States.

Pan. 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 defined 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 the 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 ladies’ coats which were stamped, tagged, labeled, or otherwise identified by respondents as containing “50% wool and 50% nylon” whereas, in truth and in fact, said wool products contained substantially different fibers and amounts of fiber than as 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 wool products, namely women’s and misses’ apparel, with labels © on or affixed thereto, which failed to disclose the percentage of the total fiber weight of the said wool products, exclusive of ornamentation not exceeding 5 per centum of said total fiber weight, of (1) wool; (2) reprocessed wool; (8) reused wool; (4) each fiber other than wool, when said percentage by weight 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 viola- ROYAL MIST, LTD., ET AL. 323 321 Decision and Order tion of the Wool Products Labeling Act of 1939 in that they were not labeled in accordance with the Rules and Regulations promulgated thereunder in the following respects: 1. Samples, swatches or specimens of wool products used to promote or effect sales of such wool products in commerce, were not labeled or marked to show the information required under Section 4(a)(2) of the Wool Products Labeling Act of 1939 and the Rules and Regulations promulgated thereunder, in violation of Rule 22 of the aforesaid Rules and Regulations.

2. The respective percentages of fibers contained in the face and in the back of pile fabrics were not set out in such a manner as to. give the ratio between the face and the back of such fabrics where an election was made to separately set out the fiber content of the face and back of the said pile fabrics, in violation of Rule 26 of the aforesaid Rules and Regulations.

Par. 6. The respondents furnished false guaranties that certain of their said wool products were not misbranded, when respondents in furnishing such guaranties had reason to believe that the wool products so falsely guaranteed might be introduced, sold, transported, or distributed in commerce, in violation of Section 9(b) of the Wool Products Labeling Act of 1939.

Par. 7. 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 methods of competition and unfair and deceptive acts and practices in commerce, within the intent and meaning of the Federal Trade Commission Act. Deciston 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 Order (7 FT.Caforesaid 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 § 2.34(b) of its Rules, the Commission hereby issues its complaint, makes the following jurisdictional findings, and enters the following order: 1. Respondent Royal Mist, Ltd., is a corporation organized, existing and doing business under and by virtue of the laws of the State of New York with its office and principal place of business located — at 512 Seventh Avenue, New York, New York. Respondent Philip Epstein is an officer of said corporation. He formulates, directs and controls the policies, acts and practices 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 Royal Mist, Ltd., a corporation, and its officers, and Philip Epstein, individually and as an officer of said corporation, and respondents’ representatives, agents and employees, directly or through any corporate or other device, in connection with the introduction, or manufacture for 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: A. Misbranding such 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. ROYAL MIST, LTD., ET AL. 325 321 Order 2. Failing to securely affix to, or place on, each such product a stamp, tag, label, or other means of identification 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.

8. Failing to affix labels to samples, swatches or specimens of wool products used to promote or effect the sale of wool products, showing in words and figures plainly legible all of the information required to be disclosed by each of the subsections of Section 4(a)(2) of the Wool Products Labeling Act of 1939. ;

4, Failing to set forth the respective percentages of fibers contained in the face and back of pile fabrics in such a manner as to give the ratio between the face and back of each such fabric where an election is made to separately set out the fiber content of the face and back of such pile fabrics, It is further ordered, That respondents, Royal Mist, Ltd., a corporation, and its officers, and Philip Epstein, individually and as an officer 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 their wool products are not misbranded under the Wool Products Labeling Act of 1939 and the Rules and Regulations promulgated thereunder when there is reason to believe that any wool product so guaranteed may be introduced, sold, transported or distributed in commerce as the term “commerce” is defined in the aforesaid Act. It is further 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.

ft is further ordered, That the respondent corporation shall forthwith distribute a copy of this order to each of its operating divisions.

It is further ordéred, That 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. Complaint V7 F.T.C.