Aamco Automatic Transmissions, Inc

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IN THE MATTER OF AAMCO AUTOMATIC TRANSMISSIONS, INC.

MODIFYING ORDER, IN REGARD '10 ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSION ACT Docket C- 'JO.5. Decision, Oct. , 1972 - Modifying Or, Feb. , 1975 Ordering modifying a consent order issued aganst respondent, 81 F. C. 618, 37 F_ I Seion 5(1) of the Fedem! Trade Commision Act (15 D. C. f,(!)) empower. district courts hearing civil penalty action to grant mandatory injunctionsand such other and further equitahlc relid as they deem approprite in the enforcement of" final order; of the Commis. ion_ 178 Order 24737, cOITections 25704, by deleting Pard.grphs III and IV of the original order which penntted respondent to formulate and establish standards for a quality control program.m, "secondary level of inspection " whereby transmission parts are tested and inspected by vendors prior to sale; penntted respondent to maintain an approved vendors list which contains the names of vendors who actually perform a "secondary level of inspection; and restricted fmnchisees to purchas only from AAMCO or vendors whose names appear on the approved vendors list. The respondent is required by the modified order to effect modification of the provisions of every contmct between it and its franchisees contrary to or inconsistent with the modified order. Appearances For the Commission: J. Thomas Rosch. For the respondent: Martin Howard Katz Bridgeport, Pa. Daniel J. McCauley, Jr., Blank, Rome, Klaus Comisky, Philadelphia, Pa. ORDER REOPENING PROCEEDING AND MODIFYING CEASE AND DESIST ORDER The Commission, on Oct. 30, 1974, having issued an order aganst respondent to show cause why the proceedings herein should not be reopened for the purose of modifying the consent order to cease and desist entered on Oct. 18, 1972 (81 F. C. 618); and Respondent having answered that it has no objection to the reopening of the proceeding and the modifcation of the consent order as set forth in the order to show cause.

Accordingly, It is ordered That the matter be reopened, and that the order herein be modifed so that it will read: It is ordered That respondent, AAMCO Automatic Transmissions Inc. (AAMCO), a corporation, its successors, assigns, officers, directors agents, representatives and employees, directly or through any corporate or other device, in connection with the franchising or licensing of persons to operate an automotive transmission repair franchise business, such franchising and operation constituting commerce, as "commerce" is defined in the Federal Trade Commission Act forthwith cease and desist from requiring, in any manner or by any means, directly or indirectly. its franchisees to purchase the automotive pars, new or rebuilt, equipment and merchandise used by such franchisees in the establishment and operation of their automotive repair business from AAMCO or from any other source; Provided That nothing in this order shall prohibit AACO from establishing, maintaining and implementing, from time to time reasonable manufacturng specifications for transmission pars, equip- Order 85 F.

ment or merchandise to be used by its franchisees in their business, and reasonable standards for transmission services, repairs, and rebuilding offered by its franchisees. Such specifications and standards shall be made available without charge to sources of supply of such items to AAMCO' s franchisees.

It is further ordered That respondent take all necessar action to effect the modification of each provision of every contract between it and its franchisees which is contrary to or inconsistent with this order. It is further ordered That respondent notify the Commission at least thirty (30) days prior to any proposed change in the corporate respondent such as dissolution, assignent or sale resulting in the emergence of a successor corporation, the creation or dissolution of subsidiaries or any other change in the corporation which may affect compliance obligations arising out of the order. It is further ordered That the respondent herein shall within sixty (60) days after service upon it of this order, fie with the Commission a report, in wrting, settng forth in detail the manner and form in which it has complied with the order.