Auslander Decorator Furniture, Inc

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IN THE MATTER OF AUSLANDER DECORATOR FURNITURE, INC., TRADING AS A.D.F., ETC., ET AL.

ORDER, OPINION, ETC., IN REGARD TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSION ACT Docket 8911. Complaint, Jan. 30, 1973-Order & Opinion, Apr. 23, 1974 Order requiring a Hanover, Md., seller and distributor of furniture and related products, among other things to cease failing to deliver ordered merchandise; delivering damaged or defective merchandise; failing to repair or replace damaged goods as advertised; misrepresenting the availability of merchandise in stock; misrepresenting prices as being “sale” prices unless such prices are reduced significantly to afford a meaningful savings over the regular selling prices; and failing to maintain records to substantiate savings claims. Further, respondents are required to refund all monies paid by customers if respondents fail to deliver merchandise within five (5) business days from an agreed-upon date of delivery. Appearances For the Commission: James D. Tangires, Michael Mpras and Alan Cohen.

For the respondents: John S. Yodice and Edwin W. Holden, III. Wash., D.C.

COMPLAINT Pursuant tothe provisions of the Federal Trade Commission Act, and by virtue of the authority vested in it by said Act, the Federal Trade Commission, having reason to believe that Auslander Decorator Furniture, Inc., a corporation, doing business as A.D.F. and A.D.F. Warehouse, and Maxwell Auslander, Sandra Tye, and Linda Decker, hedreh ey AUR NVey BUR Add | a2uzreyu 1542 Complaint individually, and as officers of said corporation, hereinafter referred to as respondents, have violated the provisions of said 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 Auslander Decorator Furniture, Inc., doing business as A.D.F. and A.D.F. Warehouse, is a corporation organized, existing and doing business under and by virtue of the laws of the District of Columbia, with its principal office and place of business located at 7451 Race Road, Hanover, Md. Its warehouse, shipping and storage facilities are located at 701 Edgewood Street, N.E., and Fourth and Channing Streets, N.E., Wash., D.C., and 7451 Race Road, Hanover, Md. It operates furniture outlets in the States of Maryland and Virginia and in the District of Columbia. Respondents, Maxwell Auslander, Sandra Tye and Linda Decker are individuals and are officers of the corporate respondent. They formulate, direct and control the acts and practices of the corporate respondent, including the acts and practices hereinafter set forth, and their address is that of said corporation.

PAR. 2. Respondents are now, and for some time last past have been, engaged in the advertising, offering for sale, sale and distribution of furniture and related products to the public at retail. PAR. 3. In the course and conduct of their business as aforesaid, respondents now cause, and for some time last past have caused, their said merchandise, when sold, to be shipped from their place of business in the District of Columbia to purchasers thereof located in various States of the United States and in the District of Columbia, and maintain, and at all times mentioned herein have maintained, a substantial course of trade in said: merchandise in commerce, as “commerce” is defined in the Federal Trade Commission Act. PAR. 4. In the course and conduct of their aforesaid business and for the purpose of inducing the sale of their merchandise, the respondents have made, and are now making, numerous statements and representations in advertisements inserted in newspapers of general interstate circulation, and by materials disseminated through the mails, and on tags or labels and in signs posted in respondents’ stores. Typical and illustrative of the foregoing, but not all-inclusive thereof, are the following:

FREE DELIVERY LAY-A- WAY * * * 8 MONTHS FREE STORAGE ADF WAREHOUSE SALE PRICE!! SAVINGS!!! AT ALL 7 ADF OUTLETS ADF WAREHOUSE SALE Complaint 83 F.T.C.

ADF WAREHOUSE CLEARANCE SALE BUY NOW AND SAVE In addition to the aforesaid statements and representations, the respondents and their sales representatives have made, and. are now making, numerous oral statements and representations to customers and prospective customers regarding the terms and conditions under which merchandise will be sold and delivered and services provided by respondents.

PAR. 5. By and through the use of the above-quoted statements and representations in Paragraph Four, and others of similar import and meaning not expressly set out herein, including the aforesaid oral statements and representations made by respondents and their sales representatives, respondents have represented, and are now representing, directly and by implication, that:

1.. Respondents will deliver their furniture to customers on or near the dates they have promised those customers for delivery. 2. Respondents maintain in their warehouse stock which is adequate to insure that furniture ordered by customers will be available for delivery on the promised delivery dates.

3. Respondents’ customers may purchase furniture on the layaway plan, and, while the payments are being made, the furniture will be stored in their warehouse, ready for delivery upon completion of all payments.

4. Respondents are offering furniture at prices which are a reduction from the prices at which respondents have sold said merchandise on a regular basis for a reasonably substantial period of time in the recent, regular course of business.

PAR. 6. In truth and in fact:

1. Respondents, in many instances do not deliver their furniture to customers on or near the dates they have promised those customers for delivery.

2. Respondents, in many instances, do not maintain in their warehouse stock which is adequate to insure that furniture ordered by customers will be available for delivery on the promised delivery dates. 3. Furniture purchased by respondents’ customers on the layaway plan is not, in many instances, stored in the warehouse ready for immediate delivery upon completion of all payments, but is sold to other customers, necessitating reordering of the merchandise when the layaway payments are completed, with resultant delays in delivery. 4. Respondents, in many instances, do not offer furniture at prices which are a reduction from the prices at which respondents have sold said merchandise on a regular basis for a reasonably substantial period of time in the recent, regular course of business. Aaearoeioy AUhUe, Au ALY L040 1542 Complaint Therefore, the statements and representations as set forth in Paragraphs Four and Five hereof, were, and are, false, misleading and deceptive.

PAR. 7. In the course and conduct of their aforesaid business and for the purpose of inducing the sale of their furniture, respondents have maintained, and are now maintaining, in their salesrooms, floor models and displays of furniture being offered for sale, on the bases of which their customers select and order the furniture they purchase from the respondents. In this connection, respondents and their sales representatives have made, and are now making, numerous oral statements and representations to customers and prospective customers regarding the quality and durability of the furniture being offered for sale, the terms and conditions under which merchandise will be sold and delivered, and the services that will be provided by the respondents. Moreover, subsequent to making sales and deliveries, respondents and their employees have made, and are now making, numerous oral statements, representations and promises to their customers regarding the time and the manner in which respondents will perform various adjustments, replacements and/or repairs.

PAR. 8. By and through the use of floor models and furniture displays discussed in Paragraph Seven, together with the aforesaid oral statements, representations and promises made by respondents, their sales representatives and other employees, respondents have represented, and are now representing, directly or by implication, that: 1. Furniture which is delivered to respondents’ customers will be identical to that which the customers have selected and ordered on the bases of respondents’ floor models and/or furniture displays. 2. Furniture delivered to customers which is different from that which the customers have selected and ordered on the bases of respondents’ floor models and/or furniture displays, will be replaced within a reasonable time, to the satisfaction of the customers, and in accordance with promises made to the customers by respondents’ employees.

3. Furniture which is delivered to respondents’ customers will be free from damages and/or defects.

4. Furniture which is delivered to purchasers with damages and/or defects, will be repaired or replaced within a reasonable time. 5. Furniture which is delivered to purchasers with damages and/or defects, will be repaired or replaced to the satisfaction of the purchasers. ° 6. Furniture which is delivered to purchasers with damages and/or defects, will be repaired or replaced in accordance with promises made to the purchasers by respondents’ employees. G Complaint 83 F.T.C.

PAR. 9. In truth and in fact:

1. Furniture is delivered to customers which, in many instances, is different from that which the customers have selected and ordered on the bases of respondents’ floor models and/or furniture displays. 2. Furniture delivered to customers which is different from that which the customers have selected and ordered on the bases of respondents’ floor models and/or furniture displays, in many instances, is not replaced within a reasonable time, to the satisfaction of the customers, and in accordance with promises made to the customers by respondents’ employees.

3. Furniture delivered to purchasers, in many instances, is damaged and/or defective. , 4. Furniture which is delivered to purchasers with damages and/or defects, in many instances, is not repaired or replaced within a reasonable time.

5. Furniture which is delivered to purchasers with damages and/or defects, in many instances, is not repaired or replaced to the satisfaction of the purchasers.

6. Furniture which is delivered to purchasers with damages and/or defects, in many instances, is not repaired or replaced in accordance with promises made to the purchasers by respondents’ employees. Therefore, the statements, representations, acts and practices set out in Paragraphs Seven and Eight were, and are, false, misleading and deceptive.

PAR. 10. In the course and conduct of their aforesaid business and at all times mentioned herein, respondents have been, and now are, in substantial competition, in commerce, with corporations, firms and individuals engaged in the sale of merchandise of the same general kind and nature as the aforesaid merchandise sold by the respondents. PAR. 11. The respondents’ use of the aforesaid false, misleading and deceptive statements, representations, acts and practices, have had, and now have, the capacity and tendency to mislead members of the purchasing public into the erroneous and mistaken belief that said statements and representations were, and are, true and complete, and into the purchase of substantial quantities of respondents’ merchandise by reason of said erroneous and mistaken belief. PAR. 12. The acts and practices of the respondents as set forth above were, and are, all to the prejudice and injury of the public and of respondents’ competitors and constituted, and now constitute, unfair methods of competition in commerce and unfair and deceptive acts and practices in commerce in violation of Section 5 of the Federal Trade Commission Act.

A... DML., WL ALA 1047 1542 Initial Decision INITIAL DECISION BY ERNEST G. BARNES, ADMINISTRATIVE LAW JUDGE FEBRUARY 15, 1974 PRELIMINARY STATEMENT Respondents Auslander Decorator Furniture, Inc., a corporation, doing business as A.D.F. and A.D.F. Warehouse, and Maxwell Auslander, Sandra Tye and Linda Decker, individually, and as officers of said corporation, are charged with violation of Section 5 of the Federal Trade Commission Act, as amended (15 U.S.C. 45). The complaint, issued by the Commission on Jan. 30, 1978, alleges that respondents, through advertisements placed in newspapers of interstate circulation, through brochures disseminated through the mails, by the use of tags or labels and in signs posted in respondents’ retail stores, and by oral representations by respondents and their sales representatives, have represented directly and by implication that:

(1) respondents will deliver furniture to customers on or near the dates they have promised those customers for delivery; (2) respondents maintain in their warehouse adequate stock to insure that furniture ordered by customers will be available for delivery on the promised delivery dates;

(3) respondents’ customers may purchase furniture on the layaway plan, and, while the payments are being made, the furniture will be stored in their warehouse, ready for delivery upon completion of all payments; and (4) respondents are offering furniture at prices which are a reduction from the prices at which respondents have sold said merchandise on a regular basis for a reasonably substantial period of time in the recent, regular course of business.

In truth and in fact, the complaint alleges, (1) respondents, in many instances, do not deliver furniture to customers on or near the dates promised customers for delivery; (2) respondents, in many instances, do not maintain in their warehouse adequate stock to insure that furniture ordered by customers will be available for delivery on the promised delivery dates; (8) furniture purchased by respondents’ customers on the layaway plan is not, in many instances, stored in the warehouse ready for immediate delivery upon completion of all payments, resulting in delays in delivery; and (4) respondents, in many instances, do not offer furniture at prices which are a reduction from the prices at which respondents have sold said merchandise on a regular basis for a reasonably substantial period of time in the recent, regular course of business. Initial Decision 83 F.T.C.

The complaint further alleges that by and through the use of floor models and furniture displays, together with oral statements, representations and promises made by respondents, their sales representatives and other employees, respondents have represented, directly or by implication, that:

(1) furniture which is delivered to respondents’ customers will be identical to that which the customers have selected and ordered on the bases of respondents’ floor models and/or furniture displays; (2) furniture delivered to customers which is different from that which the customers have selected and ordered on the bases of respondents’ floor models and/or furniture displays will be replaced within a reasonable time, to the satisfaction of the customers, in aécordance with promises made to the customers by respondents; (8) furniture which is delivered to respondents’ customers will be free from damages and/or defects; and , (4) furniture which is delivered to purchasers with damages and/or defects will be repaired or replaced within a reasonable time to the satisfaction of the purchasers and in accordance with promises made to the purchasers by respondents.

In truth and in fact, the complaint alleges, (1) furniture is delivered to customers which, in many instances, is different from that which the customers have selected and ordered on the bases of respondents’ floor models and/or furniture displays; (2) furniture delivered to customers which is different from that which the customers have selected and ordered on the bases of respondents’ floor models and/or furniture displays, in many instances, is not replaced within a reasonable time, to the satisfaction of the customers, and in accordance with promises made to the customers by respondents; (3) furniture delivered to purchasers, in many instances, is damaged and/or defective, is not repaired or replaced within a reasonable time, is not repaired or replaced to the satisfaction of the purchasers, and is not repaired or replaced in accordance with promises made to the purchasers by respondents.

Therefore, the statements, representations, acts and practices of respondents, as set out hereinbefore, were, and are, false, misleading and deceptive.

Respondents filed an answer to the complaint on Mar. 12, 1973 which consisted of a general denial of all the complaint allegations of unlawful conduct. Thereafter complaint counsel moved to strike respondents’ answer on the grounds that it did not conform to the requirements of the Commission’s Rules of Practice. Respondents at the same time requested additional time in which to file an amended answer since re- 1542 Initial Decision spoendents’ attorneys had only recently been retained and needed additional time in which to fully prepare an answer. Pursuant to permission granted by the undersigned, respondents filed an amended answer on Apr. 6, 1973. The amended answer was in greater detail than the original answer, and respondents generally denied substantially all the allegations of unlawful conduct set forth in the complaint.

Prior to the filing of the aforesaid amended answer, a prehearing conference was held on Apr. 8, 1973. Thereafter, on Apr. 30, 1973 and May 14, 1973, prehearing conferences were held. At the prehearing conference on Apr. 30, 1973, respondents amended their answer in part (P. Tr. 48). On June 11, 1978, respondents filed a motion for permission to further amend their answer, together with a Second Amended Answer. By order filed June 21, 1973, respondents’ motion to further amend their answer was granted.

By the Second Amended Answer, respondents Auslander Decorator Furniture, Inc. and Maxwell Auslander admitted the allegations contained in the complaint. Individual respondents Sandra Tye and Linda Decker admitted the allegations of the complaint, except that these respondents denied that (1) they have participated as individuals in any of the acts or practices alleged in the complaint, and (2) denied that they formulate, direct and control the acts and practices of the corporate respondent, Auslander Decorator Furniture, Inc., including the acts and practices set forth in the complaint. All respondents reserved the right to submit proposed findings and conclusions under Section 3.46 of the Rules of Practice, the right to appeal the initial decision herein to the Commission under Section 3.52 of the Rules of Practice, and the right to judicially appeal from any adverse Commission decision. On June 20, 1973, the undersigned issued an order limiting the factual issues to be tried in this proceeding in view of respondents’ admission answer. The factual issues remaining to be tried were set forth as follows:

(1) Do individual respondents Sandra Tye and Linda Decker formulate, direct and control the acts and practices of the corporate respondent Auslander Decorator Furniture, Inc., and (2) Have individual respondents Sandra Tye and Linda Decker participated in the acts and practices alleged in the complaint? By letter dated Aug. 1, 1973, the undersigned was advised by John 8S. Yodice, counsel for respondents, that he was withdrawing his representation of individual respondents Sandra Tye and Linda Decker, but would remain as counsel for the corporate respondent and individual respondent Maxwell Auslander. Thereafter, by telephone, the undersigned was advised: by individual respondents Sandra Tye and Linda 1550 FEDERAL TRADE COMMISSION DECISIONS © Initial Decision 83 F.T.C.

‘Decker that Mr. Yodice was withdrawing as their counsel as they were financially unable to retain counsel to represent them in their individual capacities. Individual respondents Sandra Tye and Linda Decker requested that the undersigned provide them with counsel to represent them in the trial of this matter, because of their financial inability to retain counsel.

On Aug. 15, 1973, the undersigned issued an order requiring individual respondents Sandra Tye and Linda Decker to support their request for assignment of counsel by filing a statement of financial status and other supporting documentation. Individual respondents Sandra Tye and Linda Decker, by telephone, later withdrew their request for assignment of counsel and stated their intention of appearing in person at the trial and representing themselves (see Decker, Tr. 333; Tye, Tr. 365).

Hearings were held on Sept. 10-11, 1978, at which time evidence was received relating to the two issues remaining to be litigated, i.e., the responsibility of Sandra Tye and Linda Decker for the acts and practices of corporate respondent Auslander Decorator Furniture, Inc. and their personal participation in the acts and practices admitted to be unlawful. Complaint counsel called as witnesses the three corporate officials named in the complaint, Maxwell Auslander, Sandra Tye and Linda Decker. Over one hundred (100) exhibits were offered by complaint counsel and received into evidence. Individual respondents Sandra Tye and Linda Decker offered no evidence in defense. Complaint counsel and counsel for corporate respondent Auslander Decorator Furniture, Inc. and individual respondent Maxwell Auslander have submitted proposed findings, conclusions and supporting memoranda. Individual respondents Sandra Tye and Linda Decker have not submitted any memoranda, although they were offered the opportunity to do so if they desired (Tr. 367). On Nov. 28, 1973, the Commission extended the time for filing this initial decision to and including Feb. 18, 1974. This proceeding is before the undersigned upon the complaint, answer, testimony and other evidence, proposed findings of fact and conclusions and briefs filed by complaint counsel and by counsel for the corporate respondent and individual respondent Maxwell Auslander. These submissions by the parties have been given careful consideration and, to the extent not adopted by this decision in the form proposed or in substance, are rejected as not supported by the record or as immaterial. Any motions not heretofore or herein specifically ruled upon, either directly or by the necessary effect of the conclusions in this decision, are hereby denied. The findings of fact made herein are based on a review of the entire record and upon a consideration of the demeanor of the witnesses who gave testimony in this proceeding. AWU.F., WLl., BL AL. Lvl 1542 Initial Decision For the convenience of the Commission and the parties, the findings of fact include references to the principal supporting evidentiary items in the record. Such references are intended to serve as convenient guides to the testimony and exhibits supporting the recommended findings of fact, but do not necessarily represent complete summaries of the evidence considered in arriving at such findings. References to the record are made in parentheses, and certain abbreviations, as hereinafter set forth, are used: CX—Commission’s Exhibits CPF—Proposed Findings, Conclusions of Law, And Order of Counsel Supporting the Complaint RPF—Proposed Findings, Conclusions, And Order of Respondents Auslander Decorator Furniture, Inc. and Maxwell Auslander CRB—Brief In Reply To Proposed Findings, Conclusions, And Order of Respondents Auslander Decorator Furniture, Inc. and Maxwell Auslander filed by Counsel Supporting the Complaint The transcript of the testimony is referred to with the abbreviation “Tr.,” and the page number or numbers upon which the testimony appears and the last name of the witness whose testimony is being cited. “P. Tr.” refers to the transcript of the prehearing conferences.

Having heard and observed the witnesses and after having carefully reviewed the entire record in this proceeding, together with the proposed findings, conclusions and briefs submitted by the parties, as well as replies, the administrative law judge makes the following: FINDINGS OF FACT 1. Respondent Auslander Decorator Furniture, Inc. (hereinafter referred to as “ADF ”), doing business as A.D.F. and A.D.F. Warehouse, is a corporation organized, existing and doing business under and by virtue of the laws of the District of Columbia, with its principal office and place of business located at 7451 Race Road, Hanover, Md. Its warehouse, shipping and storage facility is located at said principal place of business. Prior to September 1972, ADF had warehouse, shipping and storage facilities located at 701 Edgewood Street, N.E., Wash., D.C., and Fourth and Channing Street, N.E., Wash., D.C. Respondent ADF, doing business as A.D.F. and A.D.F. Warehouse, operates furniture outlets in the States of Maryland and Virginia and in the District of Columbia (Admitted Second Amended Answer, P. Tr. 91-92). .

2. Respondent Maxwell Auslander is an individual and is president of the corporate respondent. He formulates, directs and controls the acts and practices of the corporate respondent, including the acts ahd prac- Initial Decision 83 F.T.C.

tices set forth in the complaint issued herein. His address is the same as that of the corporate respondent (Admitted Second Amended Answer, P. Tr. 60).

3. Respondent Sandra Tye is an individual and is a vice president of corporate respondent ADF (Admitted Second Amended Answer; Tye, P. Tr. 88-89; Tye, Tr. 334; Auslander, Tr. 123-124). Her address is the same as that of the corporate respondent (Admitted Second Amended Answer).

4. Respondent Linda Decker is an individual and was, from Nov. 1971 until May 31, 1973, a vice president of corporate respondent ADF (Admitted Second Amended Answer; Decker, P. Tr. 94; Decker, Tr. 240; Auslander, Tr. 124). Her present home address is 1418 Kensington Place, Crofton, Maryland (Decker, P. Tr. 94; Decker, Tr. 689). Respondent Linda Decker is no longer employed by corporate respondent ADF (Decker, Tr. 239-241).

5. Respondents are now, and for some time last past have been, engaged in the advertising, offering for sale, sale and distribution of furniture and related products to the public at retail (Admitted Second Amended Answer).

6. In the course and conduct of their business as aforesaid, respondents now cause, and for some time last past have caused, their said merchandise, when sold, to be shipped from their place of business in the District of Columbia to purchasers thereof located in various States of the United States and in the District of Columbia, and maintain, and at all times mentioned herein have maintained, a substantial course of trade in said merchandise in commerce, as “commerce” is defined in the Federal Trade Commission Act (15 U.S.C. 41-58) (Admitted Second Amended Answer).

7. In the course and conduct. of their business as set forth in the complaint and at all times mentioned herein, respondents have been, and now are, in substantial competition, in commerce, with corporations, firms and individuals engaged in the sale of merchandise of the same general kind and nature as the aforesaid merchandise sold by the respondents (Admitted Second Amended Answer). 8. In the course and conduct of their business as set forth in the complaint and for the purpose of inducing the sale of their merchandise, the respondents have made, and are now making, numerous statements and representations in advertisements inserted in newspapers of general interstate circulation, and by materials disseminated through the _ mails, and on tags or labels and in signs posted in respondents’ stores. Typical and illustrative of the foregoing, but not all-inclusive thereof, are the following:

A.D.F., ETC., ET AL. 1553 1542 Initial Decision FREE DELIVERY LAYAWAY * * * 8 MONTHS FREE STORAGE ADF WAREHOUSE SALE PRICE!! SAVINGS!!! AT ALL 7 ADF OUTLETS ADF WAREHOUSE SALE | ADF WAREHOUSE CLEARANCE SALE BUY NOW AND SAVE In addition to the aforesaid statements and representations, the respondents and their sales representatives have made, and are now making, numerous oral statements and representations to customers and prospective customers regarding the terms and conditions under which merchandise will be sold and delivered and services provided by respondents (Admitted Second Amended Answer). 9. By and through the use of the above-quoted statements and representations, as set out in Finding 8 hereinabove, and others of similar import and meaning not expressly set out, including the aforesaid oral statements and representations made by respondents and their sales representatives, respondents have represented, and are now representing, directly and by implication, that:

(1) Respondents will deliver their furniture to customers on or near the dates they have promised those customers for delivery. (2) Respondents maintain in their warehouse stock which is adequate to insure that furniture ordered by customers will be available for delivery on the promised dates.

(3) Respondents’ customers may purchase furniture on the layaway plan, and, while the payments are being made, the furniture will be stored in their warehouse, ready for delivery upon completion of all payments.

(4) Respondents are offering furniture at prices which are a reduction from the prices at which respondents have sold said merchandise on a regular basis for a reasonably substantial period of time in the recent, regular course of business (Admitted Second Amended Answer). 10. In truth and in fact:

(1) Respondents, in many instances, do not deliver their furniture to customers on or near the dates they have promised those customers for delivery.

(2) Respondents, in many instances, do not maintain in their warehouse stock which is adequate to insure that furniture ordered by customers will be available for delivery on the promised delivery date. (3) Furniture purchased by respondents’ customers on the layaway plan is not, in many instances, stored in the warehouse ready for immediate delivery upon completion of all payments, but is sold to other customers, necessitating reordering of the merchandise when the layaway payments are completed, with resultant delays in delivery. Initial Decision 83 F.T.C.

(4) Respondents, in many instances, do not offer furniture at prices which are a reduction from the prices at which respondents have sold said merchandise on a regular basis for a reasonably substantial period of time in the recent, regular course of business. Therefore, the statements and representations, as set forth in Findings 8 and 9 hereinabove, were, and are, false, misleading and deceptive (Admitted Second Amended Answer).

11. In the course and conduct of their business as set forth in the complaint and for the purpose of inducing the sale of their furniture, respondents have maintained, and are now maintaining, in their salesrooms, floor models and displays of furniture being offered for sale, on the bases of which their customers select and order the furniture they purchase from the respondents. In this connection, respondents and their sales respresentatives have made, and are now making, numerous oral statements and representations to customers and prospective customers regarding the quality and durability of the furniture being offered for sale, the terms and conditions under which merchandise will be sold and delivered, and the services that will be provided by the respondents. Moreover, subsequent to making sales and deliveries, respondents and their employees have made, and are now making, numerous oral statements, representations and promises to their customers regarding the time and the manner in which respondents will perform various adjustments, replacements and/or repairs (Admitted Second Amended Answer).

12. By and through the use of the floor models and furniture displays discussed in Finding 11 hereinabove, together with the aforesaid oral statements, representations and promises made by respondents, their sales representatives and other employees, respondents have represented, and are now representing, directly or by implication, that: (1) Furniture which is delivered to respondents’ customers will be identical to that which the customers have selected and ordered on the bases of respondents’ floor models and/or furniture displays. (2) Furniture delivered to customers which is different from that which the customers have selected and ordered on the bases of respondents’ floor models and/or furniture displays, will be replaced within a reasonable time, to the satisfaction of the customers, and in accordance with promises made to the customers by respondents’ employees.

(3) Furniture which is delivered to respondents’ customers will be free from damages and/or defects.

(4) Furniture which is delivered to purchasers with damages and/or defects will be repaired or replaced within a reasonable time. (5) Furniture which is delivered to purchasers with damages and/or A.U.E., Hil., BL AL. LUVV 1542 Initial Decision defects will be repaired or replaced to the satisfaction of the purchasers. (6) Furniture which is delivered to purchasers with damages and/or defects will be repaired or replaced in accordance with promises made to the purchasers by respondents’ employees (Admitted Second Amended Answer). e 18. In truth and in fact:

(1) Furniture is delivered to customers which, in many instances, is different from that which the customers have selected and ordered on the bases of respondents’ floor models and/or furniture displays. (2) Furniture delivered to customers which is different from that which the customers have selected and ordered on the bases of respondents’ floor models and/or furniture displays, in many instances, is not replaced within a reasonable time, to the satisfaction of the customers, and in accordance with promises made to the customers by respondents’ employees. ~ (3) Furniture delivered to purchasers, in many instances, is damaged and/or defective.

(4) Furniture which is delivered to purchasers with damages and/or defects, in many instances, is not repaired or replaced within a reasonable time. .

(5) Furniture which is delivered to purchasers with damages and/or defects, in many instances, is not repaired or replaced to the satisfaction of the purchasers.

(6) Furniture which is delivered to purchasers with damages and/or defects, in many instances, is not repaired or replaced in accordance with promises made to the purchasers by respondents’ employees (Admitted Second Amended Answer).

Therefore, the acts, practices, statements and representations, as set forth in Findings 11 and 12 hereinabove, were, and are, false, misleading and deceptive (Admitted Second Amended Answer). Individual Respondent Linda Decker 14. Individual respondent Linda Decker began her employment with ADF as a sales person in ADF’s College Park, Md., store in Jan. 1970 and continued as a sales person until Oct. 1970 (Auslander, Tr. 140; Decker, Tr. 243). In Oct. 1970, she became manager of ADF’s Lexington Park, Md., store (Auslander, Tr. 141; Decker, Tr. 243). She returned to the main office in College Park when Mr. Auslander suffered his heart attack in Oct. of 1971 (Auslander, Tr. 183, 141; Decker, Tr. 245). She served as a vice president of ADF from November 11, 1971 until May 31, 1973 (Decker, Tr. 240; Auslander, Tr. 124), and also served as vice president of ADF of Lexington Park, Inc. from June, 1970 until May 31, 1973 (Decker, Tr. 240). The latter corporation was Initial Decision 83 F.T.C.

formed to obtain a mortgage loan from a bank (Auslander, Tr. 125). Mrs. Decker left ADF on May 31, 1973 and is now self-employed as Decker and Associates, selling an advertising specialty item (Decker, Tr. 239-242). During her employment with ADF, Mrs. Decker was a salaried employee; she did not receive a commission or percentage of profits, and she did not own any stock in ADF (Decker, Tr. 250, 827-328, 333).

15. As manager of the Lexington Park retail store, Mrs. Decker had authority to hire store personnel (Decker, Tr. 250). She also arranged her own delivery schedules, which was a unique situation among the ADF stores (Auslander, Tr. 148). She trained her employees (Auslander, Tr. 147), and arranged for newspaper and radio advertisements in the Lexington Park area newspapers and radio stations (Auslander, Tr. 167, 168; Decker, Tr. 248, 244). Mrs. Decker also sold on the floor (Decker, Tr. 244), and was responsible for the innovation of having her, as store manager, deal directly with the customers: Q. Now, when you became store manager of the Lexington Park store, you also were performing some innovations for that particular store that was not being carried out by other retail stores; is that correct? ;

A. So far as handling the customer directly, I knew that there had been problems as far as getting through to the warehouse to set up delivery at this end, and I asked him to agree to let me handle all of my customers myself, and particularly because they would be calling long distance. I thought that it would be better to be done on a local basis. I am from that area, and could not see having any problems to call long distance; I prefer that myself. So it became kind of a self-contained, you know, everything had to go back to Washington, but I literally did it (Decker, Tr. 244). 16. During her employment with ADF from January, 1970 through May 31, 1973, Mrs. Decker performed various duties other than those already mentioned. She had authority to sign checks, but never did so (Decker, Tr. 250). She had authority to hire and fire store personnel as a store manager [all store managers had this authority] (Decker, Tr. 250, 251). She shopped competition (Decker, Tr. 275); she visited ADF stores and reported back to Mr. Auslander (Decker, Tr. 285); she handled details concerning the construction of new stores and the warehouse (Decker, Tr. 321). Mrs. Decker talked with the manufacturers’ representatives and followed purchase orders to determine why there were shipping delays (Auslander, Tr. 159). Later, as assistant to Mr. Auslander, she fired certain personnel, including a store manager, and she was requested to fire the ADF advertising agency. These latter acts had the specific approval of Mr. Auslander (Decker, Tr. 252, 254, 284).

17. After firing the ADF advertising agency, Mrs. Decker prepared the advertising copy and placed the advertisements with the newspapers. This work was all approved by Mr. Auslander (Decker, Tr. 253~ AWU.P., HLU., Wl ALA Loo’ 1542 Initial Decision 259). She identified herself as the ADF advertising manager on occasions (Decker, Tr. 266). She used the pseudonym of Decker Advertising; the idea was to form an “in-house advertising agency” (Decker, Tr. 255) in order to get an agency rebate, which was turned over to ADF (Decker, Tr. 267-268).

. On Oct. 25, 1971, Mr. Auslander suffered a severe heart attack and was hospitalized for one month (Auslander, Tr. 129, 131; Decker, Tr. 245). Within 24 hours, Mrs. Decker moved to the main ADF office at College Park (Decker, Tr. 245). With the assistance of individual respondent Sandra Tye, Mrs. Decker began “picking up pieces” and made a sincere effort to continue the day-to-day operations of ADF and “to bring everything under control” (Decker, Tr. 247). Mr. Auslander, after being hospitalized for one month, thereafter worked a light schedule for several weeks (Auslander, Tr. 131-132). Mrs. Decker and Mrs. Tye carried on the business operations. Mr. Auslander testified: ~ Q. So Linda Decker and Sandy Tye sort of held the pieces together until you came back, is that correct? A. As best as they could, yes.

Q. Did they do a good job?.

A. I think they did a great job .compared to with suddenly a whole new situation was thrust upon them and consequently, I think under the circumstances, they performed, I think, most admirably (Auslander, Tr. 133). 19. At the time of Mr. Auslander’s heart attack, the opening of a Rockville, Md., store was pending. Mrs. Decker, with permission from Mrs. Auslander and with the assistance of Mrs. Tye, went ahead with plans for the Rockville store opening:

So, the first couple of days we brought the managers together to discuss how we were going to do this, and worked on the Rockville grand opening, and everyone volunteered to work.

We kept the store open to Midnight for the grand opening, and so forth, and the whole idea was to keep the morale up and let the world think we knew what we were doing, whether we did or not (Decker, Tr. 247).

You kind of had to pretend it was all going well (Decker, Tr. 331). 20. In June of 1972, Mrs. Decker was given the responsibility for handling consumer complaints for ADF (Auslander, Tr. 141-142; Decker, Tr. 296-298). Pursuant to Mr. Auslander’s instructions, Mrs. Decker contacted the various consumer protection groups, including the Federal Trade Commission, and informed them that all consumer complaints were to be directed to her attention (Decker, Tr. 298-299). She testified that she usually took these complaints to Mr. Auslander for instructions, although there were instances where she did not discuss Initial Decision 83 F.T.C.

the complaints with him prior to disposition (Decker, Tr. 299). Mrs. Decker also testified that she did not always show Mr. Auslander the letters which she sent out in response to consumer complaints (Decker, Tr. 300).

21. In May of 1971, ADF was notified of a pending investigation by the Federal Trade Commission (Auslander, Tr. 149). Mr. Auslander testified that he had Mrs. Decker talk with Mr. Klasic, the FTC attorney, in the Lexington Park store because:

A. At that time, we had the Edgewood Street warehouse, * * * and the Edgewood Street warehouse was just an absolute disaster. You had a bunch of people in a tiny little room; it was not conducive in any way for any kind of conversation or for any kind of fact finding.

So consequently, this was probably the only area, that it was a reasonably new building, it had a couple of private offices and, of course, she was there and she was a little more knowledgeable than some of the other people in the other stores were so consequently, we chose that area right down there.

Q. Why didn’t you talk to the FTC Attorney, you are President of the Company; she is not even an Officer? A. Okay, good point. But again, she was a little more familiar, again, with dealing with the customers thing. Also in that area, she would have more knowledge as to what would be handled, delivered, what would be selling and so forth, whereas I kind of would not know (Auslander, Tr. 150).

Mrs. Decker stated that she spoke with the FTC attorney because of the Lexington Park location, since Mr. Auslander was busy with other things, and:

* * * Thad more time to do this sort of thing from a cost standpoint. It was less costly to have me doing this rather than to pay an attorney. In addition I knew where the information was (Decker, Tr. 269).

Part of Mrs. Decker’s interview with Mr. Klasic concerned the sales tag used by ADF at that time (CX 4), and Mrs. Decker relayed to Mr. Auslander Mr. Klasic’s concern about its terminology, including the word “Sale,” used on the sales tag (Decker, Tr. 272). Mrs. Decker testified about CX 5, the sales tag which replaced CX 4: Q. And you helped in creating this particular sales tag. A. I relayed the information to Mac, the final sale [sic] on everything. Q. But didn’t you have some input as to what should be said on the tag in view of your conversations with Mr. Classic [sic].

A. Yes (Decker, Tr. 272).

22. The record supports a conclusion that Mrs. Decker participated in the challenged acts and practices of corporate respondent ADF. There is substantial evidence that Mrs. Decker participated in ADF’s advertising, both while store manager at the Lexington Park store (Decker, Tr. 243) and while serving as an assistant to Mr. Auslander (Decker, Tr. A.D. ., lU., asa saan 1542 Initial Decision 255-266). She testified that she was aware that the advertised prices of most merchandise appearing in ADF advertisements were generally the usual selling price, and not reduced (Decker, Tr. 277). She testified that merchandise purchased on layaway would be set aside only if a substantial deposit were paid (Decker, Tr. 290-291). She also testified that she knew that there was a dollar limitation on ADF’s advertised “Free Delivery” policy (Decker, Tr. 294). Mrs. Decker participated in the formulation of the sales tags and invoices (CX 5, 8), which misrepresented “Free Delivery,” “Sale,” and “Layaway” (Decker, Tr. 282). 23. Mrs. Decker’s participation in the admitted unlawful acts and practices of the corporate respondent ADF was, however, that of an employee, and not as an officer of the corporation responsible for corporate policy. Mr. Auslander testified quite emphatically that ‘“* * * the decisions or basic policy was absolutely originating with me, either right or wrong” (Auslander, Tr. 145-146). Mrs. Decker was not even-aware of — the fact that she was an officer of corporate respondent ADF until the FTC investigation was well under way (Decker, Tr. 240-241, 327). Mr. Auslander testified that the Rockville store opening was preplanned (Auslander, Tr. 184), that he chose the items of furniture for the advertisements, established the advertised prices, and was the final authority on advertising (Auslander, Tr. 148, 153, 169). He testified that he established the guidelines for handling customer complaints, he saw many of the complaint letters before they were sent out, and that he actually dictated or wrote other responses to complaints (Auslander, Tr. 144, 189, 208, 217, 222, 227; CX 55). Mr. Auslander determined the selling prices of all merchandise (Auslander, Tr. 167, 171), and he revised the ADF sales invoices and sales tags (Auslander, Tr. 182-185, 195).

Mrs. Decker testified that the advertisements she placed while manager of the Lexington Park store were items “Max would give me” (Decker, Tr. 248). She received permission from Elaine (Mrs. Auslander) to proceed with the Rockville store opening after Mr. Auslander had his heart attack (Decker, Tr. 247). The advertisements for the Rockville store opening were taken from previous advertisements “which is the way I have seen Max do it almost two years” (Decker, Tr. 248). After she took over the advertising duties, she made up the advertisements, “cutting and pasting them togéther bit by bit” for Mr. Auslander’s approval (Decker, Tr. 255-256). She made suggestions for the advertisements, which suggestions were sometimes accepted, sometimes not (Decker, Tr. 257-258). Her participation in the advertising program under the pseudonym “Decker Advertising” was for the purpose of getting a rebate for ADF (Decker, Tr. 267-268). While Mrs. Decker admitted she had some “input” on the revised sales tag, Mr. Initial Decision 83 F.T.C.

Auslander had the final say on everything (Decker, Tr. 272). In handling customer complaints, she became a detective and talked to everyone involved with the customer and ultimately took it to Mr. Auslander for final resolution (Decker, Tr. 299). 24. In sum, Mrs. Decker was an employee of corporate respondent ADF, certainly a very loyal and hardworking employee, whose duties after Mr. Auslander’s heart attack were those of “a general assistant” to Mr. Auslander (Auslander, Tr. 159). Carrying on the business while Mr. Auslander was disabled was basically a singular occurrence under special circumstances.

25. Neither the duties of Mrs. Decker as a general assistant to Mr. Auslander, nor the conduct of the business while Mr. Auslander. was disabled, is sufficient to attribute to Mrs. Decker the responsibility for formulation, direction or control of the acts and practices of corporate respondent ADF.

As Mrs. Decker stated it, there are two big issues concerning her individual responsibility—advertising and taking over operation of the business while Mr. Auslander was incapacitated. As regards these issues, she testified:

* * * Under the advertising aspect of it I certainly have no training per se in advertising. I copied 100 percent what I had seen two advertising agencies do, and the only reason I did it was to save the company money. So the mistakes that were made there were made strictly because I was copying somebody else’s work. That is all I had to go by. Regarding my taking-over situation when he was in the hospital I—to say the very least, I am very fond of the man. * * * The whole idea was to keep morale up, and keep sales up, and get rid of many problems before he comes back. * * * I wanted as much as possible for him to think everything was under control. * * * I feel I am being persecuted by the Federal Government because of what was really a humanitarian act. That is what it . amounts to (Tr. 329-830).

Individual Respondent Sandra Tye 26. Individual respondent Sandra Tye has been employed by ADF for over nine (9) years (Tye, Tr. 363). She has been vice president of ADF at least since 1970 (Auslander, Tr. 123, 124; Tye, Tr. 334). For the last four years Mrs. Tye has been in charge of ADF’s warehouse operation (Tye, Tr. 89, 334). Her duties consist of receiving all the merchandise which comes from the factories, and shipping all merchandise out to customers (Tye, Tr. 89, 338). Mrs. Tye also has worked part-time as a sales person for ADF in addition to her warehouse duties (Tye, Tr. 344). She has, on occasion, trained other ADF employees in sales work (Tye, Tr. 363-364). She has authority to sign payroll checks and to sign checks for freight bills (Tye, Tr. 356-357).

Mrs. Tye is a salaried employee of ADF; she does not participate in any profit sharing arrangement or receive a commission (Tye, Tr. 358, 364), and she does not own any stock in ADF (Tye, Tr. 335). . A.D.F., ETC, ET AL. 1561 BAR EERE Initial Decision .

27 At one time ADF operated three warehouses, located at 701 Edgewood Street, N.E., Wash., D.C., Fourth and Channing Street, N.E., Wash., D.C., and 7451 Race Road, Hanover, Md. The Channing oe Street. warehouse ‘was used as a storage area (Tye, P. ‘Tr. 91-92; Tye, ‘Tr. 336). In 1972, the Race Road warehouse was completed and opened, ~ enabling ADF to close the other two warehouses (Tye, ‘Tr. 337). 28. Mrs. Tye handled some consumer complaints coming into the ~~ warehouse (Tye, Tr. 340-341, 349, 352). These complaints were handled without reference to Mr. Auslander (Tye, Tr. 841). 29. At the time of Mr.: Auslander’s heart attack, “Mrs. Tye “only did ... - what I have been doing before and anything that the two of us [Mrs. — _ Decker and Mrs. Tye] would try to work out but we didn’t do anything © differently. that was not being—hadn’t been done. We tried to piece up things” (Tye, Tr. 354-355). Mrs. Tye worked with Mrs. Decker, mostly: _ by telephone, during Mr. Auslander’s absence, since Mrs. Tye had a full ~~ schedule operating the warehouses (Tye, Tr. 354, 355; Decker, Tr. 246). Payments due to furniture manufacturers were held until Mr. Auslan-. der returned to work—“the factories were quite understanding” (Tye, Tr. 356).

30. Mrs. Tye was well-aequainted with the problems of late delivery of merchandise, the failure to lay away merchandise for customers, the delivery of damaged merchandise, and the failure to deliver nierchan- ‘dise identical to the items ordered by a customer (Tye, Tr. 338-339, 343, 347, 348, 350-351, 357-861). As the person in charge of the warehouse, she personally participated in these admittedly unlawful acts and prac-. tices of corporate respondent ADF.

31. Testimony by Mrs. Tye indicates that the delivery problems - alleged in the complaint—the delayed deliveries, the failure to lay away customers’ orders, the delivery of damaged merchandise, and the failure to deliver merchandise identical to that ordered by a customer were due to inadequate warehouse space and incompetent. warehouse personnel (Tye, Tr. 341-348, 348, 357; Auslander, Tr. 150, 192-193). Theft was also a serious problem at the warehouse (Tye, Tr. 348). Mr. Auslander was aware of the warehouse conditions, the lack of space and ~~ the problems with theft. The Race Road warehouse was constructed to - -- alleviate these problems (Tye, Tr. 342, 357-358; Auslander, Tr. 192). 82. Mr. Auslander testified that he made all policy in the warehouse -(Auslander, ‘Tr: 129), and that he set up the ‘inventory and storage controls in the warehouse (Auslander, Ty. 192). Further, he established the guidelines for handling customer complaints (see Finding 23). Mr. | Auslander testified that “basic policy was absolutely originating with me” (Auslander, Tr. 145-146). Since Mr. Auslander was responsible for basic policy, and since he was well aware of the warehouse problems

the dee ey ee eM sp WAR Iti Desison Q. These ‘two. women executed. -an agreement, were they consulted about, that, as to what they were ‘signing? “ © AL At the time, I was so disturbed about this thing, I think that both of them i in their ae “aim to. possibly pacify 3 me ‘and because of my condition, , whatever, TL think they ‘Brobably : “would have + gone: ‘along with most anything. . a .Q..A great. sense of loyalty? apy: ;

oo AL -Yes; even though-—exactly even. though something was 5 very injurious, to > themzi selves (Tr. 151-152)... an The events surrounding the execution of the coiisent agreement shed ° illumination over the other issues raised by the complaint. The participation of individual respondents: Linda Decker and Sandra Tye i in-the admittedly unlawful.acts set forth in. the complaint occurred out of , employee loyalty, not t corporate responsibility. ~ CONCLUSIONS, Corporate respondent Auslander Decorator Furniture, Ine. and individual respondent Maxwell Auslander have, by. their Second Amended AG Answer, admitted all the material allegations: of the complaint. This - ~. Second Amended Answer was filed with the Commission on June 11, ~ 1978 and accepted for filing in the record herein by order of the under signed dated June 20,1978... , Under Section 3.12(b)(2) of the Commission’ s Rules of Practice, it i is 7 provided that the complaint: and the admitting answer will provide a record basis.on which the administrative law judge shall file an initial’ - decision, including | an appropriate order. Accordingly, the undersigned . has, in this case, ruled that the complaint allegations and said respondents’ Second Amended Answer shall constitute the record: basis for this decision regarding said respondents (Order Denying Complaint ~ Counsel’s Motion To Reconsider Order Limiting Proof Complaint Coun- - sel May Offer To Corroborate Admitted Complaint Allegations, dated July 13, 1973; Tr. 115). The findings | of fact relating to these two ‘respondents are based entirely on their admission answer. Therefore, the only issues remaining as to these respondents are the scope of. the remedy and whether the remedy should be made applicable to Maxwell * Auslander i in 1 his individual capacity.

: “Individual Respondent Maxwell Auslander Respondent Maxwell’ Auslander, by virtue of the Second Amended Answer filed herein on June 11, 1973, has admitted that he formulates, | - directs and controls the acts and practices of the corporate respondent, —_ including the acts and practices alleged in the complaint. This answer -includes the admission’ that the acts and practices enumerated in Para- - graphs Four, Five, Seven and Hight of the complaint are false, misleading and deceptive, and ‘that respondents’ use. of the aforesaid. false, 1564. FEDERAL ‘TRADE COMMISSION. ‘DECISIONS. es : 2 Initial:5 1 2 1 2 4 1237 301 144 70 48.499454 Decisions 1 2 1 2 5 1404 336 2 2 16.700981 :5 1 2 1 2 6 1471 339 3 2 61.029636 :5 1 2 1 2 7 1535 316 41 12 18.536972 ae5 1 2 1 2 8 1588 297 12 43 0.000000 :5 1 2 1 2 9 1617 335 85 27 24.950783 a5 1 2 1 2 10 1741 311 62 60 43.166386 885 1 2 1 2 11 1807 314 37 57 47.888214 F.5 1 2 1 2 12 1848 302 30 44 34.991295 T:5 1 2 1 2 13 1882 308 23 62 30.752647 c2 1 3 0 0 0 1757 233 110 80 -1 3 1 3 1 0 0 1757 233 110 80 -1 4 1 3 1 1 0 1757 233 110 80 -1 5 1 3 1 1 1 1757 233 110 80 95.000000 2 1 4 0 0 0 527 398 1485 1417 -1 3 1 4 1 0 0 518 398 1494 1417 -1 4 1 4 1 1 0 547 398 1364 78 -1 5 1 4 1 1 1 547 398 243 75 0.000000 Fisleading’5 1 4 1 1 2 796 420 64 40 96.568565 ands 1 4 1 1 3 881 405 179 62 96.663101 deceptive5 1 4 1 1 4 1073 398 224 78 95.940491 statements,5 1 4 1 1 5 1313 401 314 72 96.242233 representations,5 1 4 1 1 6 1633 398 99 75 76.380173 “acts5 1 4 1 1 7 1740 401 73 66 52.301907 ahd:5 1 4 1 1 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1 4 1 12 8 1325 972 116 47 96.707840 order,5 1 4 1 12 9 1448 974 176 48 96.843163 referring5 1 4 1 12 10 1632 977 38 30 96.955460 to5 1 4 1 12 11 1680 968 59 48 64.903679 thes 1 4 1 12 12 1751 973 187 46 20.271080 Supreme4 1 4 1 13 0 541 1018 1393 53 -1 5 1 4 1 13 1 541 1024 172 47 33.724945 _.Court’s5 1 4 1 13 2 730 1025 171 33 95.674683 decisions 1 4 1 13 3 892 1036 33 21 96.902191 in5 1 4 1 13 4 935 1025 148 44 96.784279 Federal5 1 4 1 13 5 1100 1025 108 41 75.210075 Trade.5 1 4 1 13 6 1225 1020 238 50 75.902451 Commissions 1 4 1 13 7 1478 1034 31 23 93.116753 v.5 1 4 1 13 8 1525 1018 187 45 68.417549 Standards 1 4 1 13 9 1717 1021 217 50 51.110767 Education4 1 4 1 14 0 572 1075 1362 45 -1 5 1 4 1 14 1 572 1076 148 43 96.254761 Society,5 1 4 1 14 2 746 1076 63 32 95.911186 3025 1 4 1 14 3 832 1076 82 32 95.326279 U.S.5 1 4 1 14 4 942 1067 63 40 96.674782 1125 1 4 1 14 5 1024 1076 110 37 93.190254 (1937)5 1 4 1 14 6 1157 1067 114 47 93.014542 (RPF,5 1 4 1 14 7 1284 1079 44 42 50.893181 p.5 1 4 1 14 8 1344 1076 74 36 56.627922 17).5 1 4 1 14 9 1445 1075 70 43 56.627922 Thes 1 4 1 14 10 1537 1075 119 40 96.756157 records 1 4 1 14 11 1678 1075 40 35 95.777306 in5 1 4 1 14 12 1734 1075 74 37 96.726013 this5 1 4 1 14 13 1825 1077 183 43 37.718040 case,4 1 4 1 15 0 579 1116 1341 61 -1 5 1 4 1 15 1 579 1125 179 42 96.169434 according5 1 4 1 15 2 775 1128 37 30 96.169434 to5 1 4 1 15 3 832 1116 250 61 96.203575 respondents,5 1 4 1 15 4 1088 1125 35 33 90.745621 is5 1 4 1 15 5 1147 1119 120 39 93.915085 devoid5 1 4 1 15 6 1289 1119 42 45 96.718178 of5 1 4 1 15 7 1342 1126 68 40 96.570633 any5 1 4 1 15 8 1423 1116 168 52 96.290695 evidences 1 4 1 15 9 1612 1119 76 48 96.290695 that5 1 4 1 15 10 1708 1117 212 53 96.281708 respondents 1 4 1 15 11 1933 1121 64 46 18.220261 a4 1 4 1 16 0 547 1165 1457 81 -1 5 1 4 1 16 1 547 1198 2 2 30.603928 -5 1 4 1 16 2 579 1176 156 39 93.093124 Maxwell5 1 4 1 16 3 749 1171 193 38 92.068504 Auslander5 1 4 1 16 4 955 1179 100 32 81.443306 must.5 1 4 1 16 5 1051 1173 217 57 67.568703 necessarily5 1 4 1 16 6 1280 1174 43 35 96.964935 be5 1 4 1 16 7 1336 1166 220 50 95.387367 individually5 1 4 1 16 8 1567 1165 108 81 96.238075 joined5 1 4 1 16 9 1698 1175 16 63 90.230194 i5 1 4 1 16 10 1696 1185 33 21 96.587631 in5 1 4 1 16 11 1741 1171 62 57 97.003326 thes 1 4 1 16 12 1817 1174 101 62 96.996834 orders 1 4 1 16 13 1930 1174 74 41 7.744827 cease4 1 4 1 17 0 578 1219 1389 50 -1 5 1 4 1 17 1 578 1226 146 31 96.177292 because5 1 4 1 17 2 733 1213 15 58 96.700943 a5 1 4 1 17 3 773 1221 192 45 94.422745 possibility5 1 4 1 17 4 981 1217 37 40 96.966042 of5 1 4 1 17 5 1031 1225 138 32 96.673691 evasion5 1 4 1 17 6 1186 1224 116 33 96.260468 exists.5 1 4 1 17 7 1452 1231 2 2 7.659592 .5 1 4 1 17 8 1909 1219 98 50 10.791824 Pe4 1 4 1 18 0 584 1240 1338 80 -1 5 1 4 1 18 1 584 1275 69 32 22.616608 It5 1 4 1 18 2 671 1274 29 34 95.411194 is5 1 4 1 18 3 718 1274 166 34 96.124199 admitted5 1 4 1 18 4 902 1275 76 32 95.991684 that5 1 4 1 18 5 997 1275 157 33 93.292191 Maxwell5 1 4 1 18 6 1171 1275 193 39 92.641449 Auslander5 1 4 1 18 7 1380 1275 212 38 95.929298 formulates,5 1 4 1 18 8 1608 1240 133 71 90.890862 directs5 1 4 1 18 9 1751 1260 77 47 94.519432 ands 1 4 1 18 10 1833 1243 89 77 32.719254 cores 1 4 1 18 11 1947 1277 61 34 21.453156 ee4 1 4 1 19 0 578 1313 1394 62 -1 5 1 4 1 19 1 578 1325 84 45 96.969826 trols5 1 4 1 19 2 676 1325 62 32 96.594650 thes 1 4 1 19 3 749 1328 72 29 96.563538 acts5 1 4 1 19 4 835 1325 65 32 96.270020 ands 1 4 1 19 5 913 1325 167 41 96.853363 practices5 1 4 1 19 6 1094 1325 37 31 96.985191 of5 1 4 1 19 7 1141 1313 178 62 96.880920 corporate5 1 4 1 19 8 1331 1325 210 45 96.004639 respondents 1 4 1 19 9 1553 1325 106 38 96.212929 ADF,5 1 4 1 19 10 1674 1318 173 52 96.383606 including5 1 4 1 19 11 1858 1324 114 43 34.553566 the.4 1 4 1 20 0 579 1371 1334 43 -1 5 1 4 1 20 1 579 1368 71 38 95.603699 acts5 1 4 1 20 2 674 1374 65 32 95.603699 ands 1 4 1 20 3 760 1373 166 45 96.935936 practices5 1 4 1 20 4 950 1373 165 32 96.333405 admitted5 1 4 1 20 5 1138 1375 36 29 96.332153 to5 1 4 1 20 6 1194 1369 44 36 96.654533 be5 1 4 1 20 7 1258 1372 179 41 96.738670 deceptive5 1 4 1 20 8 1459 1368 78 37 96.834869 ands 1 4 1 20 9 1546 1368 186 36 94.867966 therefore5 1 4 1 20 10 1743 1366 229 47 55.095390 unlawful.4 1 4 1 21 0 578 1411 1379 69 -1 5 1 4 1 21 1 578 1424 105 37 96.227936 Thus,5 1 4 1 21 2 697 1423 185 33 96.613358 individuals 1 4 1 21 3 895 1420 218 44 96.176826 respondents 1 4 1 21 4 1117 1422 158 33 93.281113 Maxwell5 1 4 1 21 5 1288 1422 221 41 91.509483 Auslander’s5 1 4 1 21 6 1523 1422 170 50 96.469826 dominion5 1 4 1 21 7 1702 1420 71 60 96.172577 ands 1 4 1 21 8 1788 1411 141 67 54.106022 control.5 1 4 1 21 9 1955 1426 36 25 35.216286 ee4 1 4 1 22 0 579 1473 1366 53 -1 5 1 4 1 22 1 579 1484 82 42 96.781639 overs 1 4 1 22 2 678 1468 176 46 89.122665 corporate5 1 4 1 22 3 871 1475 208 39 95.918015 respondents 1 4 1 22 4 1095 1473 118 32 96.790176 ADF5 1 4 1 22 5 1204 1483 29 22 95.991798 is5 1 4 1 22 6 1249 1473 144 32 96.445381 without5 1 4 1 22 7 1408 1473 147 40 31.099174 dispute.5 1 4 1 22 8 1706 1474 2 2 8.381363 ,5 1 4 1 22 9 1934 1479 11 18 0.000000 E4 1 4 1 23 0 622 1492 1347 76 -1 5 1 4 1 23 1 622 1524 151 32 96.467537 Because5 1 4 1 23 2 787 1524 36 31 96.193512 of5 1 4 1 23 3 833 1521 101 34 96.193512 these5 1 4 1 23 4 946 1524 207 40 96.604698 undisputed5 1 4 1 23 5 1168 1518 98 43 86.564217 facts,5 1 4 1 23 6 1282 1523 48 31 94.416916 it5 1 4 1 23 7 1334 1521 16 35 94.416916 is5 1 4 1 23 8 1364 1523 156 34 96.357376 believed5 1 4 1 23 9 1535 1508 187 60 96.360451 necessary5 1 4 1 23 10 1721 1521 47 33 46.904366 to5 1 4 1 23 11 1782 1492 136 70 85.526123 subjects 1 4 1 23 12 1932 1525 37 31 44.650330 Be4 1 4 1 24 0 551 1570 1372 44 -1 5 1 4 1 24 1 551 1573 185 33 34.260231 Maxwell5 1 4 1 24 2 751 1574 210 31 92.153145 Auslander5 1 4 1 24 3 976 1573 195 41 96.167175 personally5 1 4 1 24 4 1194 1576 35 29 96.976212 to5 1 4 1 24 5 1254 1572 59 33 96.723938 thes 1 4 1 24 6 1337 1567 113 38 96.038956 order.5 1 4 1 24 7 1480 1573 31 32 96.038956 It5 1 4 1 24 8 1534 1573 33 32 96.678886 is5 1 4 1 24 9 1588 1576 60 29 69.403038 not5 1 4 1 24 10 1672 1582 192 31 95.657562 necessary5 1 4 1 24 11 1879 1570 112 44 0.000000 to4 1 4 1 25 0 579 1617 1360 50 -1 5 1 4 1 25 1 579 1623 233 44 96.473251 demonstrates 1 4 1 25 2 835 1632 42 23 96.473251 an5 1 4 1 25 3 900 1621 112 34 96.777107 intents 1 4 1 25 4 1034 1626 36 29 96.933960 to5 1 4 1 25 5 1093 1623 108 32 96.005943 evade5 1 4 1 25 6 1223 1623 60 32 96.963043 thes 1 4 1 25 7 1305 1617 112 45 96.671402 order,5 1 4 1 25 8 1443 1621 39 34 96.671402 or5 1 4 1 25 9 1504 1620 86 34 57.121498 even5 1 4 1 25 10 1615 1632 19 22 57.121498 a5 1 4 1 25 11 1654 1622 205 40 96.331009 probability5 1 4 1 25 12 1882 1622 36 31 85.314995 of5 1 4 1 25 13 1963 1621 21 23 0.000000 -4 1 4 1 26 0 579 1671 1348 42 -1 5 1 4 1 26 1 579 1674 136 31 96.563553 evasion5 1 4 1 26 2 731 1673 36 32 96.675560 of5 1 4 1 26 3 777 1674 59 31 96.566582 thes 1 4 1 26 4 851 1674 111 38 96.566582 order,5 1 4 1 26 5 979 1677 36 27 96.970604 to5 1 4 1 26 6 1027 1673 79 32 96.882767 holds 1 4 1 26 7 1120 1683 42 21 96.360924 an5 1 4 1 26 8 1178 1673 182 32 95.940308 individuals 1 4 1 26 9 1373 1673 210 40 96.505630 respondents 1 4 1 26 10 1594 1672 195 41 96.453384 personally5 1 4 1 26 11 1800 1671 127 33 66.136429 liable.4 1 4 1 27 0 579 1722 1331 41 -1 5 1 4 1 27 1 579 1724 48 31 96.268539 As5 1 4 1 27 2 649 1723 58 32 96.268539 thes 1 4 1 27 3 727 1722 224 33 96.499184 Commissions 1 4 1 27 4 972 1724 115 31 96.394096 stated5 1 4 1 27 5 1106 1723 35 31 93.284065 in5 1 4 1 27 6 1159 1722 118 33 91.659798 Coran5 1 4 1 27 7 1296 1723 96 32 93.279640 Bros.5 1 4 1 27 8 1418 1723 115 40 91.376450 Corp.,5 1 4 1 27 9 1558 1726 30 29 93.135796 et5 1 4 1 27 10 1607 1722 64 39 80.710770 al.,5 1 4 1 27 11 1695 1722 131 32 96.235451 Dockets 1 4 1 27 12 1847 1722 63 31 96.267502 No.4 1 4 1 28 0 577 1765 1260 50 -1 5 1 4 1 28 1 577 1773 94 38 96.614189 8697,5 1 4 1 28 2 691 1773 39 31 89.605606 725 1 4 1 28 3 746 1772 125 43 85.692184 F.T.C.5 1 4 1 28 4 893 1774 27 37 94.844124 1,5 1 4 1 28 5 939 1774 41 30 96.001129 255 1 4 1 28 6 996 1773 92 40 35.773453 July5 1 4 1 28 7 1106 1774 49 38 95.413582 11,5 1 4 1 28 8 1177 1773 103 36 96.403442 1967):5 1 4 1 28 9 1835 1765 2 2 4.471634 .2 1 5 0 0 0 575 1845 1411 322 -1 3 1 5 1 0 0 575 1845 1414 322 -1 4 1 5 1 1 0 612 1845 1302 33 -1 5 1 5 1 1 1 612 1845 57 26 96.812248 Thes 1 5 1 1 2 679 1845 90 33 96.504158 public5 1 5 1 1 3 781 1845 116 26 96.393158 interests 1 5 1 1 4 911 1846 122 32 96.753288 requires5 1 5 1 1 5 1046 1846 60 26 96.581085 that5 1 5 1 1 6 1118 1846 48 26 96.581085 thes 1 5 1 1 7 1180 1845 177 27 96.586441 Commissions 1 5 1 1 8 1370 1845 65 27 96.848206 takes 1 5 1 1 9 1446 1845 67 26 96.922409 such5 1 5 1 1 10 1525 1845 208 33 96.720551 precautionary5 1 5 1 1 11 1747 1852 129 26 96.443321 measures 1 5 1 1 12 1885 1852 29 18 96.743584 as4 1 5 1 2 0 575 1882 1341 35 -1 5 1 5 1 2 1 575 1893 62 24 96.922653 may5 1 5 1 2 2 651 1884 33 26 96.662285 be5 1 5 1 2 3 699 1893 142 24 96.113930 necessary5 1 5 1 2 4 855 1887 30 24 91.740730 to5 1 5 1 2 5 898 1885 70 26 91.740730 closes 1 5 1 2 6 983 1885 41 26 95.920959 offs 1 5 1 2 7 1035 1893 52 24 95.920959 any5 1 5 1 2 8 1102 1885 67 26 96.612564 wide5 1 5 1 2 9 1185 1883 145 34 96.456642 “loophole”5 1 5 1 2 10 1345 1884 116 33 96.785950 through5 1 5 1 2 11 1476 1884 84 25 96.777679 which5 1 5 1 2 12 1575 1884 46 25 96.694511 thes 1 5 1 2 13 1636 1882 190 27 96.759705 effectiveness5 1 5 1 2 14 1840 1883 28 25 96.516174 of5 1 5 1 2 15 1879 1883 37 25 96.516174 its4 1 5 1 3 0 579 1926 1335 34 -1 5 1 5 1 3 1 579 1921 93 31 96.971474 orders5 1 5 1 3 2 684 1934 61 24 83.855072 may5 1 5 1 3 3 755 1926 34 26 83.855072 be5 1 5 1 3 4 799 1926 209 26 96.487373 circumvented.5 1 5 1 3 5 1023 1926 69 26 96.488960 Such5 1 5 1 3 6 1104 1935 16 17 81.317940 a5 1 5 1 3 7 1127 1926 151 34 81.317940 “loophole”5 1 5 1 3 8 1288 1926 22 26 95.520813 is5 1 5 1 3 9 1321 1926 127 26 95.454285 obvious5 1 5 1 3 10 1443 1934 53 18 54.036827 ina5 1 5 1 3 11 1504 1934 61 18 96.030594 cases 1 5 1 3 12 1575 1918 105 34 0.000000 suchas5 1 5 1 3 13 1691 1926 63 30 96.626678 this,5 1 5 1 3 14 1765 1926 92 25 96.917984 where5 1 5 1 3 15 1867 1926 47 25 96.971664 thea 1 5 1 4 0 578 1967 1407 36 -1 5 1 5 1 4 1 578 1968 107 33 96.637375 owning5 1 5 1 4 2 703 1968 52 26 96.862442 ands 1 5 1 4 3 775 1968 158 33 96.451988 controlling5 1 5 1 4 4 952 1970 80 31 96.508560 party5 1 5 1 4 5 1052 1968 29 26 96.317558 of5 1 5 1 4 6 1097 1976 33 19 96.919289 an5 1 5 1 4 7 1149 1968 183 33 96.202805 organizations 1 5 1 4 8 1351 1976 71 24 96.109734 may,5 1 5 1 4 9 1442 1968 24 25 96.149071 if5 1 5 1 4 10 1480 1968 35 25 95.898827 he5 1 5 1 4 11 1532 1968 72 25 96.896889 later5 1 5 1 4 12 1621 1967 115 32 96.621887 desires,5 1 5 1 4 13 1756 1967 92 36 96.771690 defeat5 1 5 1 4 14 1867 1968 118 25 21.827347 the:4 1 5 1 5 0 578 2005 1408 38 -1 5 1 5 1 5 1 578 2017 132 25 96.771591 purposes5 1 5 1 5 2 727 2010 28 25 96.183632 of5 1 5 1 5 3 766 2010 49 25 82.793953 thes 1 5 1 5 4 831 2009 200 27 91.500404 Commission’s5 1 5 1 5 5 1046 2010 89 26 96.973991 actions 1 5 1 5 6 1150 2010 36 33 96.795380 by5 1 5 1 5 7 1201 2009 97 33 96.897316 simply5 1 5 1 5 8 1313 2009 195 34 96.465927 surrendering5 1 5 1 5 9 1523 2009 41 27 97.004257 his5 1 5 1 5 10 1580 2005 143 37 96.299576 corporate5 1 5 1 5 11 1738 2009 109 26 93.245293 charter5 1 5 1 5 12 1861 2009 74 26 0.000000 and<5 1 5 1 5 13 1963 2019 23 5 15.403809 .~4 1 5 1 6 0 578 2050 1394 34 -1 5 1 5 1 6 1 578 2051 116 33 96.702606 forming5 1 5 1 6 2 706 2059 16 18 95.871674 a5 1 5 1 6 3 733 2059 58 18 95.871674 news 1 5 1 6 4 805 2052 177 32 96.428177 corporation,5 1 5 1 6 5 997 2059 31 18 96.662621 or5 1 5 1 6 6 1039 2051 157 33 96.206169 continuing5 1 5 1 6 7 1206 2052 47 25 96.875488 thes 1 5 1 6 8 1264 2052 124 25 96.486839 business5 1 5 1 6 9 1400 2052 88 25 96.816887 under5 1 5 1 6 10 1499 2059 16 18 96.051300 a5 1 5 1 6 11 1525 2050 175 33 96.759460 partnerships 1 5 1 6 12 1714 2052 157 31 96.400116 agreements 1 5 1 6 13 1884 2058 46 25 31.654503 or...4 1 5 1 7 0 579 2088 1370 56 -1 5 1 5 1 7 1 579 2100 29 19 94.215698 as5 1 5 1 7 2 628 2101 33 18 94.215698 an5 1 5 1 7 3 680 2093 147 26 96.832787 individuals 1 5 1 7 4 844 2093 215 33 96.590965 proprietorship5 1 5 1 7 5 1080 2094 65 25 96.590965 with5 1 5 1 7 6 1165 2086 132 40 96.885254 completes 1 5 1 7 7 1315 2093 146 51 96.656677 disregards 1 5 1 7 8 1477 2094 43 25 96.757477 for5 1 5 1 7 9 1537 2093 48 26 92.626152 thes 1 5 1 7 10 1604 2092 203 33 91.932045 Commission’s5 1 5 1 7 11 1826 2088 102 37 39.846069 action4 1 5 1 8 0 578 2131 1345 36 -1 5 1 5 1 8 1 578 2133 107 32 96.603737 against5 1 5 1 8 2 697 2133 47 26 96.774544 thes 1 5 1 8 3 756 2133 179 32 96.641327 predecessors 1 5 1 8 4 947 2133 192 34 96.493958 organization.2 1 6 0 0 0 1938 954 81 295 -1 3 1 6 1 0 0 1938 954 81 295 -1 4 1 6 1 1 0 1938 954 81 295 -1 5 1 6 1 1 1 1938 954 81 295 95.000000 2 1 7 0 0 0 548 2198 1431 346 -1 3 1 7 1 0 0 548 2198 1431 346 -1 4 1 7 1 1 0 610 2198 1358 49 -1 5 1 7 1 1 1 610 2202 81 32 89.734070 ‘Thes 1 7 1 1 2 715 2203 228 40 96.203537 undersigned5 1 7 1 1 3 969 2202 27 33 96.746109 is5 1 7 1 1 4 1022 2202 146 41 93.940247 entirely5 1 7 1 1 5 1193 2203 33 31 93.940247 in5 1 7 1 1 6 1251 2203 118 32 96.392960 accords 1 7 1 1 7 1394 2203 81 33 96.784836 with5 1 7 1 1 8 1502 2202 58 32 96.989311 thes 1 7 1 1 9 1585 2203 108 44 96.695618 above5 1 7 1 1 10 1717 2202 192 42 93.558029 reasoning.5 1 7 1 1 11 1966 2202 2 2 49.032169 =4 1 7 1 2 0 579 2252 1335 41 -1 5 1 7 1 2 1 579 2252 171 41 96.597061 Although5 1 7 1 2 2 764 2252 60 32 96.666435 thes 1 7 1 2 3 838 2253 119 32 92.987518 records 1 7 1 2 4 971 2263 37 22 92.987518 as5 1 7 1 2 5 1032 2256 35 36 96.341225 to5 1 7 1 2 6 1073 2253 157 39 93.292747 Maxwell5 1 7 1 2 7 1243 2253 193 32 92.058853 Auslander5 1 7 1 2 8 1450 2253 81 33 96.446487 does5 1 7 1 2 9 1546 2256 60 29 96.405266 not5 1 7 1 2 10 1619 2253 93 32 96.405266 shows 1 7 1 2 11 1726 2253 52 32 96.630531 his5 1 7 1 2 12 1794 2254 120 30 96.193085 extent4 1 7 1 3 0 579 2302 1332 44 -1 5 1 7 1 3 1 579 2302 35 32 96.612297 of5 1 7 1 3 2 626 2303 203 40 96.612297 ownership,5 1 7 1 3 3 847 2303 26 32 94.614822 it5 1 7 1 3 4 889 2303 81 32 94.614822 does5 1 7 1 3 5 986 2304 234 32 93.396866 demonstrates 1 7 1 3 6 1234 2304 53 38 77.582481 his.5 1 7 1 3 7 1303 2304 165 42 77.582481 completes 1 7 1 3 8 1484 2303 168 33 96.756546 dominion5 1 7 1 3 9 1669 2313 82 22 96.593010 overs 1 7 1 3 10 1765 2303 59 32 96.513748 thes 1 7 1 3 11 1840 2306 71 29 96.637276 acts5 1 7 1 3 12 1929 2297 23 14 61.169361 im4 1 7 1 4 0 579 2351 1400 43 -1 5 1 7 1 4 1 579 2352 64 31 96.714996 ands 1 7 1 4 2 661 2351 167 41 96.836861 practices5 1 7 1 4 3 848 2352 36 32 96.802559 of5 1 7 1 4 4 901 2352 58 31 96.814583 thes 1 7 1 4 5 979 2355 178 37 96.356018 corporate5 1 7 1 4 6 1176 2353 217 40 96.102966 respondent.5 1 7 1 4 7 1417 2352 72 32 96.581139 Thes 1 7 1 4 8 1507 2352 120 32 96.746307 records 1 7 1 4 9 1648 2352 80 32 96.781624 does5 1 7 1 4 10 1749 2351 230 43 11.558395 establish...4 1 7 1 5 0 578 2400 1370 43 -1 5 1 7 1 5 1 578 2401 75 32 96.833580 that5 1 7 1 5 2 669 2400 183 34 96.669144 individuals 1 7 1 5 3 866 2403 228 40 96.592453 respondents5 1 7 1 5 4 1113 2402 107 33 96.344467 Linda5 1 7 1 5 5 1237 2403 133 31 96.344467 Decker5 1 7 1 5 6 1385 2403 66 31 96.900375 ands 1 7 1 5 7 1468 2402 137 33 96.186569 Sandra5 1 7 1 5 8 1616 2403 70 39 73.073105 Tye5 1 7 1 5 9 1704 2402 41 32 73.073105 do5 1 7 1 5 10 1762 2405 66 29 65.756836 not.5 1 7 1 5 11 1837 2412 75 22 9.059181 owns 1 7 1 5 12 1968 2395 11 36 0.000000 ~4 1 7 1 6 0 579 2449 1393 48 -1 5 1 7 1 6 1 579 2461 65 31 96.703453 any5 1 7 1 6 2 657 2451 95 33 96.465195 stocks 1 7 1 6 3 764 2451 35 32 96.651779 in5 1 7 1 6 4 811 2451 104 33 96.432037 ADF.5 1 7 1 6 5 932 2452 70 39 96.858856 Thes 1 7 1 6 6 1015 2449 119 36 96.866730 records 1 7 1 6 7 1148 2453 135 44 96.505211 furthers 1 7 1 6 8 1296 2453 202 32 96.109169 establishes5 1 7 1 6 9 1510 2452 76 33 96.949852 that5 1 7 1 6 10 1599 2452 157 33 93.215149 Maxwell5 1 7 1 6 11 1768 2449 143 47 0.000000 Auslan-5 1 7 1 6 12 1928 2445 19 56 0.000000 .5 1 7 1 6 13 1969 2480 3 16 86.676605 .4 1 7 1 7 0 548 2497 1363 47 -1 5 1 7 1 7 1 548 2506 2 2 0.000000 ~5 1 7 1 7 2 579 2503 61 31 96.794151 ders 1 7 1 7 3 652 2497 156 46 96.877335 appoints5 1 7 1 7 4 824 2503 133 41 96.925598 officers5 1 7 1 7 5 972 2503 35 33 96.846115 of5 1 7 1 7 6 1018 2504 93 32 96.772331 ADF5 1 7 1 7 7 1126 2504 123 36 96.199142 (Linda5 1 7 1 7 8 1261 2504 133 31 96.199142 Decker5 1 7 1 7 9 1408 2514 69 22 96.803085 was5 1 7 1 7 10 1492 2504 98 32 96.800316 made5 1 7 1 7 11 1594 2493 19 56 96.862122 a5 1 7 1 7 12 1636 2503 73 33 96.695755 vices 1 7 1 7 13 1722 2497 189 47 0.000000 president) A.D.F., ETC., ET AL. 1565 1542 Initial Decision without even informing the individual of this fact. Further, numerous corporate devices are utilized in the operations of ADF, i.e., ADF Lexington Park and ADF Manassas, Va. (Tye, Tr. 335; Auslander, Tr. 125; Decker, Tr. 240). Further, in 1964 the Commission issued a cease and desist order against Maxwell Auslander individually and ADF Warehouse, Inc., apparently a different corporate device than the present corporate respondent (ADF Warehouse, Inc., et al., Docket No. 8645, 66 F.T.C. 1267).

By simply surrendering the present corporate charter, and utilizing other existing corporations, any Commission order issued solely against corporate respondent ADF could be evaded. As a simple precautionary ' measure, such an obvious “loophole” should be closed. It is well settled that the choice of the remedial order is committed to the discretion of the Commission. Federal Trade Commission v. Mandel Bros. , 359 U.S. 385, 392-93 (1959); Niresk Industries, Inc. v. Federal Trade Commission, 278 F.2d 337, 348 (7th Cir. 1960), cert. denied, 364 U.S. 883 (1960); L. G. Balfour Co. v. Federal Trade Commission, 442 F.2d 1 (7th Cir. 1971). Moreover, “ * * * once the Government has successfully borne the considerable burden of establishing a violation of law, all doubts as to the remedy are to be resolved in its favor.” United States v. E. I. du Pont de Nemours & Co., et al., 366 U.S. 316, 334 (1961). Thus, it seems most appropriate here to include individual respondent Maxwell Auslander within the scope of the remedy. As the Fourth Circuit stated in Pati-Port, Inc., et al. v. Federal Trade Commission, 313 F.2d 103, 105 (1963):

To the foregoing we might add the comment that it would seem in cases of this sort to be a futile gesture to issue an order directed to the lifeless entity of a corporation while exempting from its operation the living individuals who were responsible for the illegal practices. , Individual Respondents Linda Decker and Sandra Tye Individual respondents Linda Decker and Sandra Tye, in their Second Amended Answer, admitted the allegations of the complaint, except that said respondents deny that:

(1) they participate or have participated as individuals in any of the acts or practices alleged in the complaint, and (2) they formulate, direct and control the acts and practices of the corporate respondent, including the acts and practices set forth in the complaint. It is concluded that individual respondents Linda Decker and Sandra Tye did not formulate, direct or control the acts and practices of ADF. The record clearly establishes that “the decisions or basic policy was absolutely originating with” Maxwell Auslander, the president of ADF (Auslander, Tr. 145-146). Linda Decker and Sandra Tye were essen- Initial Decision 83 F.T.C.

tially employees of ADF, who worked under Mr. Auslander’s direction and supervision. They owned no stock in the corporation and received only a salary, with no commission or percentage of profits. The fact that each was a vice president of the corporation is not sufficient to import control over the corporate activities. Linda Decker did not even know when she was made an officer of ADF. She testified: “t+ T was told after it had been done. I am sure he thought he was being complimentary, and I would enjoy it, although I had said previously that I did not want to (Tr. 241). Sandra Tye testified as to her designation as vice president of ADF: At that time I thought it was a title because we had so many offices and I didn’t do anything differently than I had done before (Tr. 356). Complaint counsel rely upon several previous decisions as a precedent for including Sandra Tye and Linda Decker individually in a cease and desist order (CPF, pp. 13-17). It is unquestioned that an individual may be personally subjected to a Commission order where the circumstances so warrant. The decisions referenced by complaint counsel all have the element of control or responsibility for the corporate acts. In Standard Distributors, Inc., et al. v. Federal Trade Commission, 211 F.2d 7, 15 (2d Cir. 1954), the very language quoted by complaint counsel states that an order may include those officers “in top control of the activities” of the corporation. In Cotherman, et al. v. Federal Trade Commission, 417 F.2d 587 (5th Cir. 1969), a corporate vice president, who was second in command of the corporation and who actively participated in the unlawful practices, was held individually liable. He was also a stockholder and had had previous experience in the industry before joining respondent. In the Matter of Allenton Mills, Inc., et al., 60 F.T.C. 1630, 1641 (1962), the Commission found that the operations of the respondents were conducted strictly as a family arrangement, and that the corporate identities were a fiction. Ownership, direction and control were found to exist with the individual respondents, although each individual looked for guidance to one respondent, Max Furman. In Surf Sales Company, et al. v. Federal Trade Commission, 259 F.2d 744 (7th Cir. 1958), the manager of the corporation was named individually in the order, but here again the Court concluded that the individual “had and did exercise authority, responsiblity and direction of the affairs” of the corporation (Ud. at 747).

Consequently, since the record is devoid of evidence of actual control or responsiblity by Sandra Tye and Linda Decker over the affairs of ADF, and since their participation in the unlawful acts and practices of ADF was that of employees working under the direction and supervision of Maxwell Auslander, it is concluded that any remedy entered A.D.F., ETC., ET AL. | 1567 1542 Initial Decision herein should bind these two respondents only in their corporate capacity, and not as individuals.

The Remedy Complaint counsel have proposed an order in strict accordance with the order served with the complaint. Complaint counsel argue that the proposed order is well within the periphery of the Federal Trade Commission’s authority to issue remedial orders, and has, at the very least, a reasonable relation to the unfair and deceptive acts and practices admitted by respondents’ Second Amended Answer. Respondents have admitted that, in many instances, they (1) do not deliver merchandise to customers on or near the delivery dates promised, (2) do not maintain in their warehouse adequate stock to insure delivery on the promised delivery dates, and (3) do not store layaway items, necessitating reordering of the merchandise with resultant delays in delivery.

Respondents have admitted that, in many instances, they (1) deliver merchandise to customers which is different from that which the customers have selected, and do not replace such merchandise within a reasonable time and in accordance with promises and representations made to respondents’ customers, and (2) deliver damaged or defective merchandise, and do not repair or replace such merchandise within a reasonable time, to the satisfaction of the customers, nor in accordance with promises and representations made to respondents’ customers. The order proposed by complaint counsel redresses these unfair and deceptive acts and practices by requiring respondents to inform all customers, orally and in writing on the contracts, of their right to cancel the contracts with a refund within ten (10) days from the date of delivery of defective or damaged merchandise, or merchandise not identical to that ordered, and requiring a refund of all monies to customers who request contract cancellation. The proposed order provides that respondents may, with the written consent of such aggrieved customers, repair or replace such damaged or defective merchandise. These provisions exempt the delivery of merchandise sold “as is” if such sales are so designated on the sales contracts, and the sale of damaged or defective merchandise is to customers who have knowledge of the damage or defect and have given written consent to purchasing same. The proposed order also requires respondents to maintain adequate records for two years in order to enable the Commission to verify compliance with these provisions of the proposed order. Respondents have admitted that, in many instances, they have falsely and deceptively represented that merchandise being offered for sale constituted a reduction from the actual bona fide price at which such Initial Decision 838 F.T.C.

merchandise was sold or offered for sale by respondents to the public on a regular basis for a reasonably substantial period of time in the recent, regular course of their business. The proposed order prohibits misrepresentations of this type, and provides for the retention of adequate records for a period of two years in order to enable the Commission to verify compliance with this provision.

The proposed order further requires that respondents (1) prominently post the cease and desist order in their salesrooms with notice that customers may receive a copy thereof, (2) deliver a copy of the order to their operating divisions and employees, and (8) notify the Commission of a change in the individual respondent’s employment and the nature of his new employment, and any change in-the corporate respondent which may affect compliance obligations with the order. Respondents ADF and Maxwell Auslander object to the proposed order on the grounds that certain provisons go beyond the scope of what the Commission may lawfully require, that certain provisions go beyond what is reasonably necessary to correct admittedly unlawful acts and practices of respondents, and that certain provisions are unsupported by the record (RPF, pp. 11-13). Respondents argue that certain provisions of the order will drastically affect respondents in the lawful conduct of their business; and that, taken as a whole, they are so unreasonable in relation to the record as to be penalizing rather than remedial. Respondents therefore urge that these provisions be stricken from any order issued herein (RPF, p. 41).

Respondents particularly object to the order provision requiring respondents to post in a prominent place a copy of the order and provide any customer or prospective’ customer with a copy thereof upon demand, as being punitive in nature, and subjecting respondents to humiliation and embarrassment (RPF, pp. 14, 33). Respondents also argue that the admitted unfair, misleading and deceptive acts and practices relate to representations, statements and promises made orally and in various advertisements, posters and signs. There is nothing in the record to indicate that respondents’ written invoices or sales contracts are in any way unfair, misleading or deceptive. By requiring respondents to cease and desist from making any such unfair or deceptive representations, the evils found to have existed will be effectively eliminated. To go beyond this and to require respondents to alter the terms and conditions in their sales contracts violates the Supreme Court’s test announced in Jacob Siegel Co. v. Federal Trade Commission, 327 U.S. 608 (1946), which requires that the remedy must relate to the violation found. Respondents argue that these provisions bestow specific rights upon respondents’ customers and saddle respondents with obligations which respondents’ competitors are left free to contest. . A.D.F., ETC., ET AL. 1569 1542 Initial Decision Respondents also argue that the Commission seeks to confine the use of the words “sale,” or “buy now and save,” or any other word or words of similar import or meaning, to situations where the price of such merchandise being offered for sale constitutes a reduction, in an amount not so insignificant as to be meaningless, from the actual bona fide price at which such merchandise was sold or offered for sale to the public on a regular basis by respondents for a reasonably substantial period of time in the recent, regular course of their business. This restriction is too narrow in view of the Commission’s own guidelines and its interpretation of their meaning.

The undersigned has carefully reviewed the provisions of the proposed order served with the complaint and recommended by complaint counsel. Certain changes have been made by the undersigned in this proposed order. The provisions of the order entered herein do have a reasonable relation to the practices found to be unlawful, and are, in fact, necessary to bring an end to and prevent recurrence of such unlawful practices. Jacob Siegel Co. v. Federal Trade Commission, supra.

Commission orders requiring alteration of contracts and providing for similar types of refunds have been upheld by the courts. The Fifth Circuit Court of Appeals has upheld a Commission order requiring respondents to (1) incorporate on their contracts a seven-day cooling off period and (2) limit the amount of their contracts to $1500. Arthur Murray Studio of Washington, Inc., et al. v. Federal Trade Commission, 458 F.2d 622 (5th Cir. 1972). The Third Circuit Court of Appeals has upheld Commission authority to order respondents, inter alia, to refund all monies to customers who have requested contract cancellation in writing within three days from the execution thereof, or those customers who indicate that they are not satisfied with respondents’ products. Windsor Distributing Company v. Federal Trade Commassion, 437 F.2d 448 (8rd Cir. 1971). Thus, it is clear that the Commission has the power, in its discretion, to direct whatever relief is reasonably necessary, including the alteration of contracts and prohibition of lawful practices, to prevent not only the unlawful practices found to exist but a recurrence of such unlawful practices. Federal Trade Commission v. National Lead Co., 352 U.S. 419 (1958).

The relation between the violation (nondelivery of merchandise or delivery of damaged or defective merchandise and the unlawful retention of customers’:monies) and the remedy (establishing dates certain for delivery of merchandise and refunding monies unless respondents deliver on dates promised, repair or replace said merchandise promptly and satisfactorily) is direct, specific, and necessary, and is framed to bring the illegal conduct to an end. By placing these customer rights on Initial Decision 83 F.T.C.

order forms, sales contracts and invoices, the customer will be certain to have in writing the understanding between the parties, and compliance with the order will be assured and monitored by customers. By placing such notices in writing, customers will actually be informed in writing of their rights under the order. The posting of the order will thus be unnecessary to protect customers’ rights under the order entered herein.

Complaint counsel have only proposed a one-year posting requirement, and it is difficult to see what such a one-year requirement will accomplish over the long haul. If the posting requirement is necessary for one year, which complaint counsel have not demonstrated, it should be necessary indefinitely. Since the order has been somewhat restructured by the undersigned to require more customer information on documents connected with the sales transactions, the posting provision has been eliminated.

The undersigned has also revised the proposed order to require delivery within five (5) business days of the agreed upon delivery date. Complaint counsel’s proposal extended respondents no leeway whatsoever on delivery dates, while respondents proposed an order requiring delivery “on or near the agreed delivery dates” (RPF, p. 6). The undersigned is of the belief that a specific time frame must be included in the order and that respondents must be given some latitude on delivery for such unforeseen occurrences as weather, equipment failure, work stoppages, or where help unexpectedly fails to report for work. Since severe penalties may attach for each order violation, some leeway is appropriate.

The order provision dealing with use of the words “sale” or “buy now and save” is designed to correct the violation of law which has been admitted. Respondents’ unlawful advertising claims represent “savings” claims, not comparative claims. The order, as drafted, does not prohibit comparative advertising, if respondents choose to do such advertising in the future, and if respondents otherwise comply with the Commission’s Trade Practice Rules for the Household Furniture Industry (CRB, pp. 12-15).

The remaining provisions of the order entered herein relate to record keeping requirments and reporting requirements. Such provisions have been utilized-in numerous Commission orders in the past and are deemed necessary herein to enable the Commission to monitor compliance with the order as entered.

CONCLUSIONS OF LAW 1. The Federal Trade Commission has jurisdiction over the respondents and this proceeding is in the public interest. A.D.F., BPU., ma ma.

1542 Initial Decision 2. Respondent Auslander Decorator Furniture, Inc., doing business as A.D.F. and A.D.F. Warehouse, is a corporation organized, existing and doing business under and by virtue of the laws of the District of Columbia, with its principal office and place of business located at 7451 Race Road, Hanover, Md.

3. Respondent Maxwell Auslander is an individual and is president of corporate respondent Auslander Decorator Furniture, Inc. He formulates, directs and controls the acts and practices of the corporate respondent, including the acts and practices set forth in the complaint issued herein. His address is the same as that of the corporate respondent.

4, Respondent Sandra Tye is an individual and is a vice president of corporate respondent Auslander Decorator Furniture, Inc. Her address is the same as that of the corporate respondent. 5. Respondent Linda Decker is an individual and was, from Nov. 1971 until May 31, 1978, a vice president of corporate respondent Auslander ‘Decorator Furniture, Inc. Her present home address is 1418 Kensington Place, Crofton, Md. Respondent Linda Decker is no longer employed by the corporate respondent.

6. Respondents are now, and for some time last past have been, engaged in the advertising, offering for sale, sale and distribution of furniture and related products to the public at retail. 7. In the course and conduct of their business as aforesaid, respondents now cause, and for some time last past have caused, their said merchandise, when sold, to be shipped from their place of business in the District of Columbia to purchasers thereof located in various States of the United States and in the District of Columbia, and maintain, and at all times mentioned herein have maintained, a substantial course of trade in said merchandise in commerce, as “commerce” is defined in the Federal Trade Commission Act (15 U.S.C. 41-58). 8. In the course and conduct of their business as set forth in the complaint and at all times mentioned herein, respondents have been, and now are, in substantial competition, in commerce, with corporations, firms and individuals engaged in the sale of merchandise of the same general kind and nature as the aforesaid merchandise sold by the respondents.

9. In the course and conduct of their business as set forth in the complaint and for the purpose of inducing the sale of their merchandise, respondents have made, and are now making, numerous statements and representations in advertisements inserted in newspapers of general interstate circulation, and by materials disseminated through the mails, and on tags or labels and in signs posted in respondents’ stores. In addition to the aforesaid statements and representations, respondents . Initial Decision 88 F.T.C.

‘and their sales representatives have made, and are now making, numerous oral statements to customers and prospective customers regarding the terms and conditions under which merchandise will be sold and delivered and services provided by respondents. By and through the use of these statements and representations, respondents have represented, and are now representing, directly and by implication, that: (1) respondents will deliver their furniture to customers on or near the dates they have promised those customers for delivery; (2) respondents maintain in their warehouse stock which is adequate to insure that furniture ordered by customers will be available for delivery on the promised dates; (8) respondents’ customers may purchase furniture on the layaway plan, and, while the payments are being made, the furniture will be stored in their warehouse, ready for delivery upon completion of all payments; and (4) respondents are offering furniture at prices which are a reduction from the prices at which respondents have sold said merchandise on.a regular basis for a reasonably substantial period of time in the recent, regular course of business. In truth and in fact: (1) respondents, in many instances, do not deliver their furniture to customers on or near the dates they have promised those customers for delivery; (2) respondents, in many instances, do not maintain in their warehouse stock which is adequate to insure that furniture ordered by customers will be available for delivery on the promised delivery date; (8) furniture purchased by respondents’ customers on the layaway plan is not, in many instances, stored in the warehouse ready for immediate delivery upon completion of all payments, but is sold to other customers, necessitating reordering of the merchandise when the layaway payments are completed, with resultant delays in delivery; and (4) respondents, in many instances, do not offer furniture at prices which are a reduction from the prices at which respondents have sold said merchandise on a regular basis for a reasonably substantial period of time in the recent, regular course of business. The aforesaid statements and representations are false, misleading and deceptive.

10. In the course and conduct of their business as set forth in the complaint and for the purpose of inducing the sale of their merchandise, respondents have maintained, and are now maintaining, in their salesrooms, floor models and displays of furniture being offered for sale, on the bases of which their customers select and order the furniture they purchase from respondents. In this connection, respondents and their sales representatives have made, and are now making, numerous oral statements and representations to customers and prospective customers regarding the quality and durability of the furniture being offered for sale, the terms and conditions under which merchandise will A.D.F., ETC., ET AL. 193 1542 Initial Decision be sold and delivered, and the services that will be provided by respondents. Moreover, subsequent to making sales and deliveries, respondents and their employees have made, and are now making, numerous oral statements, representations and promises to their customers regarding the time and the manner in which respondents will perform various adjustments, replacements and/or repairs. By and through the use of floor models and furniture displays, together with the aforesaid oral statements, representations and promises made by respondents, their sales representatives and other employees, respondents have represented, and are now representing, directly or by implication, that: (1) furniture which is delivered to respondents’ customers will be identical to that which the customers have selected and ordered on the bases of respondents’ floor models and/or furniture displays; (2) furniture delivered to customers which is different from that which the customers have selected and ordered on the bases of respondents’ floor models and/or furniture displays will be replaced within a reasonable time, to the satisfaction of the customers, and in accordance with promises made to the customers by respondents’ employees; (3) furniture which is delivered to respondents’ customers will be free from damages and/or defects; (4) furniture which is deli- _ vered to purchasers with damages and/or defects will be repaired or replaced within a reasonable time; (5) furniture which is delivered to purchasers with damages and/or defects will be repaired or replaced to the satisfaction of the purchasers; and (6) furniture which is delivered to purchasers with damages and/or defects will be repaired or replaced in accordance with promises made to the purchasers by respondents’ employees. , In truth and in fact: (1) furniture is delivered to customers which, in many instances, is different from that which the customers have selected and ordered on the bases of respondents’ floor models and/or furniture displays; (2) furniture delivered to customers which is different from that which the customers have selected and ordered on the bases of respondents’ floor models and/or furniture displays, in many instances, is not replaced within a reasonable time, to the satisfaction of the customers, and in accordance with promises made to the customers by respondents’ employees; (3) furniture delivered to purchasers, in many instances, is damaged and/or defective; (4) furniture which is delivered to purchasers with damages and/or defects, in many instances, is not repaired or replaced within a reasonable time; (5) furniture which is delivered to purchasers with damages and/or defects, in many instances, is not repaired or replaced to the satisfaction of the purchasers; and (6) furniture which is delivered to purchasers with damages and/or defects, in many instances, is not repaired or replaced Order 83 F.T.C.

in accordance with promises made to the purchasers by respondents’ employees. .

The aforesaid acts, practices, statements and representations are false, misleading and deceptive.

11. Respondents’ use of the aforesaid false, misleading and deceptive statements, representations, acts and practices have had, and now have, the capacity and tendency to mislead members of the purchasing public into the erroneous and mistaken belief that said statements and representations were, and are, true and complete, and into the purchase of substantial quantities of respondents’ merchandise by reason of such erroneous and mistaken belief.

12. The aforesaid acts and practices of respondents, as herein concluded, were, and are, all to the prejudice and injury of the public and of respondents’ competitors, and constitute unfair or deceptive acts and practices and unfair methods of competition in violation of Section 5 of the Federal Trade Commission Act, as amended (15 U.S.C. 45). ORDER It is ordered, That respondents Auslander Decorator Furniture, Inc., a corporation, its successors and assigns, and its officers, and Maxwell Auslander, individually and as an officer of Auslander Decorator Furniture, Inc., and respondents’ agents, representatives and employees, directly or through any corporation, subsidiary, division or any other device, in connection with the.advertising, offering for sale, sale and distribution of furniture and other articles of merchandise, in commerce, as “commerce” is defined in the Federal Trade Commission Act, do forthwith cease and desist from:

I (1) Failing to state, in writing, on the face of all order forms and sales contracts executed by customers, and on all invoices covering the sale of merchandise to customers, in conspicuous language likely to be read and understood by the customer, the dates for delivery of such merchandise agreed to by respondents and their customers at the time of the execution of the order or contract or the date of sale, and that respondents will refund all monies paid by such customers in the event such delivery is not made within five (5) business days of the agreed delivery dates, unless such customers agree in writing to extensions of the delivery dates. (2) Failing to deliver merchandise to customers within five (5) business days of the agreed delivery dates, or failing to refund immediately all monies paid by such customers in the event such A.D.F., ETC., ET AL. 1575 1542 Order delivery dates are not met by respondents, unless the customers agree, in writing, to extensions of the delivery dates. (3) Misrepresenting orally or in writing, directly or by implication, the availability of merchandise in stock for delivery by specific dates.

(4) Selling merchandise to customers on the layaway plan, unless such merchandise is physically set aside, in storage, for delivery to such customers upon the completion of the layaway payments, in accordance with the provisions of Subparagraphs (1) and (2) hereinabove.

(5) For a period of two (2) years from the effective date of this order, failing to maintain and produce for inspection and copying by the Federal Trade Commission upon ten (10) days’ notice, adequate records (a) which disclose the history of all orders, sales and deliveries; and (b) from which it can be determined whether or not merchandise was available in stock for delivery as of specific dates. I 0 66 66 (1) Using the words “sale,” “sale price,” “warehouse sale,” “clearance sale,” “savings,” or “buy now and save,” or any other word or words of similar import or meaning, unless the price of such merchandise being offered for sale constitutes a reduction, in an amount not so insignificant as to be meaningless, from the actual bona fide price at which such merchandise was sold or offered for sale to the public on a regular basis by respondents for a reasonably substantial period of time in the recent, regular course of their business.

(2) For a period of two (2) years from the effective date of this order, failing to maintain and produce for inspection and copying by the Federal Trade Commission upon ten (10) days’ notice, adequate records (a) which disclose the facts upon which any savings claims, sale claims and other similar representations of the type described in Subparagraph (1) hereinabove are based, and (b) from which the validity of any savings claims, sale claims and similar representations can be determined.

HI It is further ordered, That respondents shall: (1) Inform, orally, all customers at the time of sale and provide in ‘writing on the face of all order forms and sales contracts executed by customers, and on all invoices covering the sale of merchandise to customers, in conspicuous language likely to be read and under- Order 83 F.T.C.

stood by the customer, that the customer may cancel the contract with a refund of all monies theretofore paid to respondents by notification to respondents in writing within five (5) days from the date of actual delivery of the merchandise, where the merchandise delivered to a customer is defective or damaged, or is not identical to the merchandise ordered by the customer; Provided, however, That the provisions of this subparagraph shall not apply to merchandise sold “as is,” such sales to be so designated specifically on the order forms, sales contracts and invoices utilized in connection with such sales transactions, nor to sales of merchandise to customers who have knowledge of damage to, or defects in, the particular merchandise and have given written consent to purchasing same in its stated condition.

(2) Refund immediately all monies to customers who have requested contract cancellation in accordance with the provisions of Paragraph III(1) above; Provided, however, That, in lieu of making such a refund, respondents may, with the written consent of, and with no additional cost to, the customer, replace or repair defective or damaged merchandise, such replacement or repair to be fully, satisfactorily, and promptly performed. In such a case, the customer who consents to accept replacement or repair in lieu of a refund, may cancel the contract with a refund of all monies by notification to respondents in writing within five (5) days from the date of actual delivery of any replacement or repaired merchandise that is itself defective or damaged.

(8) For a period of two (2) years from the effective date of this order, maintain and produce for inspection and copying by the Federal Trade Commission upon ten (10) days’ notice, adequate records to disclose the facts pertaining to the receipt, handling and disposition of each and every communication from a customer, oral or written, requesting contract cancellation, refund, replacement or repair.

‘IV (1) Itis further ordered, That respondents deliver a copy of this order to all present and future employees or other persons engaged in the preparation and placing of respondents’ advertisements, and the offering for sale, or sale, of respondents’ products, and secure from each such employee or other person a signed statement acknowledging receipt of said order.

(2) It is further ordered, That respondent corporation shall forthwith distribute a copy of this order to each of its operating divisions. (3) It 1s further ordered, That the individual respondent Maxwell A.D.F., ETC., ET AL. 1577 1542 Order .

Auslander promptly notify the Commission of the discontinuance of his present business or employment and of his affiliation with a new business or employment. Such notice shall include said respondent’s current business address and a statement as to the nature of the business or employment in which he is engaged as well as a description of his duties and responsibilities.

(4) It is further ordered, That respondents notify the Commission at least thirty (380) 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 complaince obligations arising out of this order. (5) It is further ordered, That respondents shall, within sixty (60) days from the effective date of this order, notify the Commission in writing of the manner and form in which each has complied with this order.

(6) It is further ordered, That the complaint be, and it hereby is, dismissed as to respondents Sandra Tye and Linda Decker as individuals.

ORDER AND OPINION DENYING MOTION FOR EXTENSION OF TIME FOR FILING OF NOTICE OF INTENTION TO APPEAL AND FOR FILING APPEAL BRIEF AND FINAL ORDER AND DECISION OF THE COMMISSION This matter is before the Commission on the motion for extension of time for filing of notice of intention to appeal and for filing appeal brief of respondents Auslander Decorator Furniture, Inc. and Maxwell Auslander. Also before the Commission are complaint counsel’s opposition to motion for extension of time for filing of notice of intention to appeal and for filing appeal brief, and respondents’ answer to opposition of motion for extension of time.

Section 3.52(b), Subpart F, Part 3 of the Commission’s Rules of Practice states that a party’s right to appeal an initial decision is conditioned upon his filing of a notice of intention to appeal within 10 days after he is served with said initial decision. Movants have failed to do so, conceding that they were served on March 11, 1974, and did not even attempt to appeal or file any notice of such intention until at least April 2, 1974. Notwithstanding this provision of the rules, respondents seek waiver by the Commission of the ten-day requirement. Section 4.3(b), Part 4, of the Commission’s Rules of Practice allows an extension of time limits provided for by the rules “for good cause Order 83 F.T.C.

shown.” The only showing of cause made by movants is that respondent Maxwell Auslander was busy serving as warehouse manager as well as chief executive officer of respondent Auslander Decorator Furniture, Inc., during the ten-day period provided by Rule Sec. 3.52(b). Respondents do not dispute the fact that counsel was served with the initial decision. The Commission is of the opinion that the filing of a notice of intention to appeal is not so burdensome that movants could not have filed one. The facts presented by respondents in extenuation are not persuasive. Under these circumstances, we do not believe that the failure to so file is excused by good cause. Accordingly, It is ordered, That respondents’ motion for extension of time for filing of notice of intention to appeal and for filing of appeal brief be, and it hereby is, denied. ° It is further ordered, That the initial decision and order of the administrative law judge be, and hereby are, adopted as the decision and final order of the Commission.