National Talent Associates, Inc

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IN THE MATTER OF NATIONAL TALENT ASSOCIATES, lng., ET AL.

Docket 8,%0. C01lplalnl, Apr. J97. Decisi(Jn, NOI!. :!ri, 1975 Consent ()rd r requiring a N w York City talent and modeling agency and three closely held corporations in New ,J(' rsey, Illinois and Califurnia, among other things to cease misrepn' nting their ability to place customers into morleling and entertainment positions; using unethical and exploitative high pressure sales tadics and failing to disclose rdevant fads. Further, respondents are NATIONAL TALF:NT ASSOCIATES, INC., ET AL. 120:3 1202 Complaint requin to give consumers a three-day cooling-off pctioli within which they may cancel their contrads and receive full refund of al1 monies paid. CONSENT ORDF:R , ETC., IN REGARD TO ALLEGED VIOLATION OF THE ,'EDERAL TRADE COMMISSION ACT Appearances For the Commission: Hamet G. Mulhern. For the respondents: Donald J. Williamson, Burgoyne, Michels Rose Williamson New York City. John T. Dolan, Crummy, DelDeo Dolan Purcell Newark, N.

COMPLAINT Pursuant to the 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 National Talent Associates, Inc., a New .Jersey corporation, National Talent Associates Inc., an Illinois corporation, and National Talent Associates, Inc. , a California corporation, and Sanford Storm and Jerome P. Ashfield individually and as officers of said corporations, and William Schuller Agency, Inc., a corporation and Monica Stuart, individually and as an officer of sajd corporation, hereinafter referred to as respondents, have violated the pmvisions 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. Respondents National Talent Associates, Inc., are corporations organized, existing and doing business under and by virtue of the laws of the States of New Jersey, Ilinois and California. They maintain offices at 280 Park Ave., Rutherford, N . , 110 Jericho Turnpike, Floral Park, N. , 3525 W. Peterson Ave., Chicago, Ill., and 1900 N. Highland Ave., Hollywood, Calif' , respectively. Respondents Sanford Storm and .Jerome P. Ashfield are individuals and officers of all of the corporate respondents. They formulate, direct and control the policies, acts and practices hereinafter set forth. Their address is 280 Park Ave., Rutherford, N.J.

Respondent William Schuller Agency, Inc. is a corporation organized existing and doing business under and by virtue of the laws of the State of New York. Its principal place of business is located at 667 Madison A ve., New York, N.Y. and it also maintains an offce at 9110 Sunset Blvd., Hollywood, Calif' Respondent Monica Stuart is a principal owner and officer of Wiliam Complaint 86 f'.

Schuller Agency, Inc., and as such formulates, directs and controls the policies, acts and practices of the corporate respondent. PAR. 2. Respondents are now, and for some time in the past have been engaged in the advertising, solicitation, offering for sale and sale of photographs or services used in connection with the selection placement and employment of persons in the commercial advertising, talent, modeling or entertainment industries as models, actors actresses or entertainers.

In the course and conduct of their business respondents, their employees, agents or representatives have contracted to sell and have sold their photographs or services to purchasers located in the States of New Jersey, New York, Ilinois, California and various other States and have disseminated flyers, brochures, contracts and other printed materials to such purchasers and to prospective purchasers by means of the United States mails. Respondents maintain and have maintained a course of trade in said photographs or services in commerce as commerce" is defined in the Federal Trade Commission Act. Respondents' volume of business in the sale of photographs or services is and has been suhstantial.

PAR. 3. Respondents are now and at all times mentioned herein have been in substantial competition in commerce with other corporations firms and individuals engaged in the sale of photographs or services in connection with the selection, placement and employment of persons in the commercial advertising, talent, modeling or entertainment industries, as models, actors, actresses or entertainers. PAR. 4. In the course and conduct of their business, as aforesaid, and for the purpose of inducing the purchase of their photographs or services, respondents have made, and are now making, numerous statements and representations in letters of solicitation which are addressed and mailed to parents of children throughout the United States, in brochures and pamphlets, advertisements in telephone directories, on their written contract, and in other promotional materials which are distributed to prospective purchasers of their photographs or services by means of the United States mails, in oral solicitations, and by other means, which have the tendency and capacity of exaggerating and misrepresenting respondents' ability, effectiveness and success in placing persons as models, actors, actresses or entertainers in the commercial advertising, talent, modeling or entertainment industries, of which the following are typical but not all inclusive:

In their sales solicitation letters, respondents represent as follows: Your chilrl has recently been brought to our attention. Information comes to us from many sources including referrals from the parents of our children who feel some other 1202 Complaint child may have the necessary qualifications for the commercial advertising field, and other available sources.

Your child has recently been brought to our attention. Information and referrals come to us from the parents of our children who f( el some other child may have the necessary qualifications for the commercial advertising field, and other available sources * * * Although a great deal of our information may he inaccurate and incomplete, it is possible we could be quite interested in your child. If you would please call Ollr Rutherford offce before 2:30 at (201) 935- , we wil try to fill in the details. We have received information indicating that your child may have the necessary qualifications for the commercial advertising media * * *. If the infonnation we have is conect, we ( ()Uld be very interested in your child. It may be to your advantage if you would cali our Floral Park office at 212-:H3-6730 before 2:30 P. We have been infonned about your child, however, in order to determine any youngster s potential for the advertising field, all vital statistics are necessary (height weight, age, coloring, etc.). This information was not included * * *. Although our continued success depends on the children selected, time is also limited. Therefore, we ask you do not bring children in or send photographs. Due to the fact that very few children possess the necessary qualifications, a phone call will generally give us aU the information necessary.

2. In their brochures mailed to parents, respondents represent as follows:

NTA WORLD'S LARGEST PERSONAL MANAGERS DEVOTED EXCLUSIVE- LY TO CHILDREN * * * . N. A. was formed to supply to the agencies the most qualified new faces for thf, advertising industry * * *. Opportunity is what N. A. can offer. Children are accepted only on the basis that they may have the necessary qualifications * * * Our children are handled by the learling agencies in the country * ,. * In New York on MADISON AVENUE * * * the Willam Schuller-East. This agf,ncy has been supplying models for over 25 years * * * numbers among its clients the leading advertising agencies in the country. Monica Stuart:

Chief consultant for TV. and modeling for the Wiliam Schuller Agency, New York City. Miss Stuart has been a specialist in placing talent in print advertising and television commercials for the past fifteen years * * *. Miss Stuart personally places hundreds of children in print and T.V. advertisements every year. A. wi! arrange for Baratta Professional Service to do a series of photographs in natural color of the children accepted by their agency. In their contract forms, and other similar forms, respondents represent as follows:

National Talent Associates, Inc. agrees to renrler the following services: We wil arrange for a professional photographer to do a series of poses in natural color. These wil be submitted to Monica Stuart, chief television and modeling consultant for the William Schuller Agency, Inc., New York for her consideration for placement in the field . of print advertising and television comm( rcials. This agreement in no way guarantees placement wil be marle.

The client wiJ receive one black and white 8 x 10 portrait of their choice from the series. You are under no obligation to obtain additional portraits, but additional poses may, if you wish, be purchased through your photographer. National Talent Associates, Inc., reserves the right to submit to Monica Stuart photographs of any other ehiJd in the family who, in their opinion may have a potential Complaint 86 F.

ability. We wil continue this service for a period of five years or until the chilel herein enrolled is accepted by the William Schuller Agency, whichever occurs first. The complete cost of this service is $65 plus state tax, for the entire five year period. The photographer s service charge is $5 per year. No photographs may be used by N.T.A. without a written J elease. This agreement is binding upon both parties and is not subject to change or cancellation. National Talent Associates, Inc. agrees to render the following services: We wil arrange for a professional photographer to do a series of poses of natural color. These will be submitted to Monica Stuart, chief television and modeling consultant for the largest children s modeling agency in New York City for her consideration for placement in the field of print advertising and television commercial.s. This agreement in no way guarantees placement wiJ be made.

We will continue this service for a period offivc years or until the child herein enrolled is accepted by the agency, whichever occurs first. Should the enrolled child or any other child of said family be accepted and booked, the legal commission of 10% of the child' earnings wil be paid to said Agency.

AU children signed wil be under our personal management contract for an additional 10%. After the first $1 000 in earnings, the commission shall increase to 15%. The complete cost of this service is $135 for the entire five year period. The photographer s service charge is $5 per year. The client will receive one black and white x 10 photograph of their choice from the series. There is no obligation to obtain additional photographs, but additional poses may, if desired, be purchased through the photographer. No photographs may be used by N. A. without a release. This agreement is binding upon both parties and is not subject to change or cancelJatjon. PAR. 5. By and through the use of the aforesaid written statements respondents haveand representations quoted in Paragraph Four, represented, and are now representing, directly or by implication, that; National Talent Associates, Inc. has received information that a person may possess the necessary personal or physical characteristics or other qualifications suitable for success in the commercial advertising-, talent, modeling or entertainment industries. 2. Referrals from past purchasers of National Talent Associates photographs and services are a significant source of information about persons who may possess the necessary personal or physical characteristics or other qualifications suitable for success in the commercial advertising, talent, modeling or entertainment industries. i. Respondents, when requested, provide persons who contact them with the source from which the information referred to in National Talent Associates' sales solicitation letters was obtained or the nature of such information.

4. National Talent Associates, Inc. has the business experience knowledge or expertise needed to select the most qualified persons to be used as models, actors, actresses or entertainers in the commercial advertising, talent, modeling or entertainment industries. 5. National Talent Associates' salesmen, agents or representatives are qualified by training or experience to select and judge the .u_--..-- 1202 Complaint suitabilty of persons as models, actors, actresses or entertainers in the commercial advertising, talent, modeling or entertainment industries. 6. Persons who have been contacted by National Talent Associates Inc. have been specially selected on the basis that they may have the necessary personal or physical characteristics or other qualifications suitable for success in the commercial advertising, talent, modeling or entertainment industries.

7. A major portion of National Talent Associates' income is derived from its personal management contracts and its ability to place persons under contract with the leading advertising, modeling, talent or entertainment agencies.

8. Persons are selected and offered contracts by National Talent Associates, Inc. solely on the basis that they may possess the personal or physical characteristics or other qualifications suitable for success in the commercial advertising, talent, modeling or entertainment industries.

9. A person s chances for selection by Monica Stuart or the Willam Schuner Agency, Inc. will be greatly increased by entering into a contract with National Talent Associates, Inc. 10. Access to Monica Stuart or to the Wiliam Schuller Agency, Inc. is available solely to persons who contract with National Talent Associates, Inc.

11. Monica Stuart or the Wiliam Schuller Agency, Inc. review photographs of only those persons who have contracted with National Talent Associates, Inc.

12. National Talent Associates, Inc. arranges for professional photographs to be taken of each person placed under its contract by an independent photographic studio.

18. Persons who contract with National Talent Associates, Inc. receive one black and white 8 x 10 inch photograph of their choice annually for a five-year period, without any obligation to purchase additional photographs at an added cost.

14. Natural color photographs of persons who contract with National Talent Associates, Inc. are submitted annually, for a five-year period, to Monica Stuart of the Willam Schuller Agency, Inc. for her consideration and review.

15. National Talent Associates, Inc. photographs other persons in a family, in addition to the person whose name appears on its contract solely for the purpose of submitting said photographs to Monica Stuart of the Wiliam Schuller Agency, Inc. for her evaluation of their potential for the commercial advertising, modeling, talent or entertainment industries.

lf. The remuneration received by Monica Stuart of the Wiliam 217- 1840- 76- I20H FEDERAL TRADE COMMISSION DECISIONS Complaint 86 F.T.C.

Schuller Agency, Inc., in connection with her consideration and review of photographs submitted to her by National Talent Associates, Inc., is derived solely from a percentage of the earnings of persons selected by her and placed under contract by the Wiliam Schuller Agency, Inc. PAR. 6. In truth and in fact:

1. In the vast majority of instances, National Talent Associates, Inc. has not received information that a person may possess the necessary personal or physical characteristics or other qualifications suitable for success in the commercial advertising, talent, modeling or entertainment industries. In the vast majority of instances, respondents information consists solely of a person s birth date, the name and address of the person s parents, or other similar information obtained from commercial mailing lists, newspaper birth announcements hospital birth records, or other sources.

2. Referrals from past purchasers of National Talent Associates photographs and services are not a significant source of information about persons who may possess the necessary personal or physical characteristics or other qualifications suitable for success in the commercial advertising, talent, modeling or entertainment industries. Any such referrals from past purchasers are rare and, when made, are actively solicited by representatives of respondent National Talent Associates, Inc.

3. Respondents, when requested, do not provide persons who contact them with the source from which the information referred to in National Talent Associates' sales solicitation letters was obtained or the nature of such information. Persons who request the source from which information about them was obtained, or the nature of such information, are routinely told that such information is confidential and cannot be divulged.

4. National Talent Associates, Inc. does not have the business experience, knowledge or expertise needed to select the most qualified persons to be employed as models, actors, actresses or entertainers in the commercial advertising, talent, modeling or entertainment industries. Approximately 98 percent to 99 percent (i. 98 to 99) out of 100 persons, selected and placed under contract by National Talent Associates, Inc., are thereafter rejected by Monica Stuart of the Wiliam Schuller Agency, Inc. and are not signed to any agency contract.

5. National Talent Associates' salesmen, agents or representatives are not qualified by training or experience to select and judge the suitabilty of persons as models, actors, actresses or entertainers in the commercial advertising, talent, modeling or entertainment industries. Such salesmen, agents or representatives are recruited from all walks NATIONAL TALENT ASSOCIATES, INC.. ,;T AI.. 1209 1202 Complaint of life and are not experienced, trained or qualified talent scouts in the selection of models, actors, actresses or entertainers but are sales employees who earn a commission for each contract they sell. 6. Persons who have been contacted by National Talent Associates Inc. have not been specially selected on the basis that they may have the necessary personal or physical characteristics or other qualifications suitable for success in the commercial advertising, talent modeling or entertainment industries. Persons who are contacted by National Talent" Associates, Inc. have been arbitrarily selected from commercial mailing lists, newspaper birth announcements, hospital birth records or from other similar sources and have not been observed by any talent scout, theatrical agency, advertising or modeling agency. The vast majority of persons placed under contracts by National Talent Associates, Inc. have little or no chance for obtaining paid employment as models, actors, actresses or entertainers in the commercial advertising, modeling, talent or entertainment industries. 7. A major portion of National Talent Associates' income is not derived from its personal management contracts and its ability to place persons under contract with the leading advertising, modeling, talent or entertainment agencies. Its income is derived primarily from the monies it receives from persons with whom contracts are signed as set forth under Paragraph Four of the complaint. 8. Persons are not selected and offered contracts by National Talent Associates, Inc. only on the basis that they may possess the personal or physical characteristics or other qualifications suitable for success in the commercial advertising, talent, modeling or entertainment industries. The abilty and wilingness of parents to pay the initial contract fee plus a photographer s service charge each year for the five-year period, to National Talent Associates, Inc., as set forth on their standard contract form, appearing under Paragraph Four of this complaint, is a crucial and central element in the acceptance of any person.

9. A person s chances for selection by Monica Stuart or the Willam Schuller Agency, Inc. will not be greatly increased by entering into a contract with National Talent Associates, Inc. Approximately 98 percent to 99 percent (i. 98 to 99) out of 100 persons whose photographs are submitted to Monica Stuart of the Wiliam Schuller Agency, Inc. by National Talent Associates, Inc., after payment of monies to National Talent Associates, Inc. under the terms of its contract, are rejected by Miss Stuart by means of a standard form letter of rejection in which no specified reason for such rejection is provided.

10. Access to Monica Stuart or to the Wiliam Schuller Agency, Inc. 1210 FEDERAL TRADE COMMmSlON DECISIONS Complaint 86 F .T.C. is not available solely to persons who contract with National Talent Associates, Inc. Any person may gain access to Monica Stuart or to the Wiliam Schuller Agency, Inc., through other sources. 11. Monica Stuart or the Wiliam Schuner Agency, Inc. do not review photographs of only those persons who have contracted with N ationai Talent Associates, Inc. Any person may mail either a snapshot or a professional portrait to Monica Stuart or to the Wiliam Schuller Agency, Inc. for her or their consideration and evaluation of the person s potential for the commercial advertising, talent, modeling or entertainment industries without entering into a contract with National Talent Associates, Inc. for this purpose.

12. National Talent Associates, Inc. does not arrange for professional photographs to be taken of each person placed under its contract by an independent photographic studio. Individual respondents Sanford Storm and Jerome P. Ashfield each own approximately a one-third interest in Baratta Photo Studios to which persons are routinely sent hy National Talent Associates, Inc. to have their photographs taken. 13. Persons who contract with National Talent Associates, Inc. do not receive one hlack and white 8 x 10 inch photograph of their choice annually for a five-year period, without any obligation to purchase additional photographs at an added cost. Persons are required to travel to Baratta Photo Studios to select the 8 x 10 inch black and white photograph referred to on National Talent Associates' contract, or are solicited at their homes by salesmen from Baratta Photo Studios whose main interest is in sellng additional photographs to persons at an added Court.

14. Natural color photographs of persons who contract with National Talent Associates, Inc. are not submitted annually, for a fiveyear period, to Monica Stuart of the Wiliam Schuller Agency, Inc. for her consideration and review.

15. National Talent Associates, Inc. does not photograph other persons in a family, in addition to the person whose name appears on its contract, solely for the purpose of submitting said photographs to Monica Stuart of the Wiliam Schuller Agency, Inc. for her evaluation of their potential for the commercial advertising, modeling, talent or entertainment industries.

16. The remuneration received by Monica Stuart of the Willam Schuller Agency, Inc., in connection with her consideration and review of photographs submitted to her by National Talent Associates, Inc., is not derived solely from a percentage of the earnings of persons selected by her and placed under contract by the Willam Schuller Agency, Inc. Miss Stuart receives a monetary fee from National Talent 1202 Complaint Associates, Inc. for each series of photographs she reviews prior to the signing of any contract with the Wiliam Schuller Agency, Inc. PAR. 7. In the further course and conduct of their business as aforesaid, respondents and their representatives have made oral representations for tbe purpose of inducing persons to enter into written contracts with them. Such oral representations are made on the telephone to persons responding to respondents' initial sales solicitation letter and in personal interviews conducted by respondents' salesmen and representatives in the homes of prospective purchasers. Through such oral statements and representations, made by respondents or their representatives, agents or salesmen, respondents have, directly or indirectly, stated or implied that:

1. Persons placed under contract by National Talent Associates Inc. can reasonably anticipate significant or substantial earnings from paid employment in the commercial advertising, talent, modeling or entertainment industries as models, actors, actresses or entertainers. 2. In a significant number of instances, money sufficient to provide for a college education has been earned by persons placed under contract by National Talent Associates, Inc. 3. The chances or opportunities of persons for selection by Monica Stuart of the William Schuller Agency, or of being placed under contract by said agency, are appreciably enhanced by their placement under a contract by National Talent Associates, Inc. 4. A person s chances for selection as a model, actor, actress or entertainer in the commercial advertising, modeling, talent or entertainment industries, are greatly enhanced because he or she is Black Oriental, has red hair, freckles, or because of his or her size, age, or some other specific racial or personal characteristic. 5. Respondents have received confidential infonnation about the person or persons being interviewed by representatives of National Talent Associates, Inc. which cannot be divulged. 6. Access to Monica Stuart or to the Wiliam Schuller Agency, Inc. can be obtained only by entering into a contract with National Talent Associates, Inc.

PAR. 8. In truth and in fact:

1. Persons placed under contract by National Talent Associates Inc. cannot reasonably anticipate significant or substantial earnings from paid employment in the commercial advertising, talent, modeling or entertainment industries, as models, actors, actresses or entertainers. In the vast majority of instances, persons placed under contract by National Talent Associates, I ne. are thereafter rejected as unsuitable for employment as models, actors, actresses or entertainers of Monica Complaint 86 F.

Stuart of the Wiliam SchuIJer Agency, and thus have no opportunity of earmng any money.

2. In no significant number of instances has money sufficient to provide for a college education been earned by persons placed under contract by National Talent Associates, Inc. Few if any, persons discovered and placed under a contract by National Talent Associates Inc. have earned money sufficient to provide for a college education. 3. The chances or opportunities of persons for selection by Monica Stuart of the William Schuller Agency, or of being placed under contract by said agency, are not appreciably enhanced by their placement under a contract by National Talent Associates, Inc. In the vast majority of instances, persons placed under a contract by National Talent Associates, Inc. are not offered a contract by either Monica Stuart or by the Wiliam SchuIJer Agency, Inc. 4. A person s chances for selection as a model, actor, actress or entertainer in the commercial advertising, modeling, talent or entertainment industries are not greatly enhanced because he or she is Black, Oriental, has red hair, freckles or because of his or her size, age or some other specific racial or personal characteristic. The importance of such racial or personal characteristics are exaggerated by representatives, agents or salesmen of National Talent Associates, Inc. in an effort to obtain the signatures of persons on its contract and collect the contract fee.

5. In the vast majority of instances, respondents have not received confidential information about the person or persons being interviewed by representatives of National Talent Associates, Inc. which cannot be divulged.

6. Access to Monica Stuart or to the Wiliam SchuIJer Agency, Inc. can be obtained, not only by entering into a contract with National Talent Associates, Inc. Such access is available to persons through other sources.

PAR. 9. In the further course and conduct of their business, as aforesaid, the representatives, agents or salesmen of National Talent Associates, Inc., during their sales solicitations at the homes of potential purchasers, have made and are now making numerous false misleading and deceptive statements concerning the qualifications of persons being interviewed and their chances for success as models actors, actresses or entertainers in the commercial advertising, modeling, talent or entertainment industries, in an effort to induce such persons to enter into contracts with National Talent Associates, Inc. During the course of said solicitations, said representatives, agents or salesmen insist that persons being interviewed sign National Talent Associates' contract, set forth herein under Paragraph Four, at the 1202 Complaint time of the solicitation and write a check in payment therefor, or else forfeit their opportunity for consideration and possible selection by Monica Stuart of the Wiliam Schuller Agency, Inc. No time is permitted for thought, consideration, evaluation or discussion of said contract and, in numerous instances, persons signing said contract under such sales pressure have changed their minds immediately after the termination of said visit or on the following day. Respondents, in numerous such instances, have failed or refused to cancel the contract or refund the money.

Such sales techniques, based upon false, misleading, deceptive unethical, oppressive and exploitative high pressure tactics, take advantage of the desire of persons to achieve personal and financial success, cause substantial injury to consumers and constituted, and now constitute, unfair or deceptive acts or practices in commerce in violation of Section 5 of the Federal Trade Commission Act. PAR. 10. In the further course and conduct of their business respondents have failed to disclose to potential purchasers of their photographs or services the following material facts: a) That any person may submit his or her photograph directly to Monica Stuart, or to any other consultant of the Wiliam Schuller Agency, Inc., without entering into any contract or agreement with National Talent Associates, Inc.

b) That, in addition to the agency fee of 10 percent of the client' earnings paid to the William Schuller Agency, Inc., as stated on National Talent Associates' standard contract form, set forth herein under Paragraph Four, Monica Stuart personally receives an additional monetary fee from National Talent Associate, Inc. c) That the principals of National Talent Associates, Inc. own a financial interest in the photographic studios to which persons are routinely referred by respondents to have their photographs taken. d) The recent number and percentage of persons under contract to National Talent Associates, Inc. who were able to obtain contracts with the Wiliam Schuller Agency, Inc. and paid employment in the commercial advertising, modeling, talent or entertainment industries. e) The gross annual earnings from employment as a model, actor actress or entertainer of all persons placed under the contract set forth in Paragraph Four by respondent National Talent Associates, Inc. Knowledge of such facts would be of extreme importance to potential purchasers in their evaluation of the nature and value of the photographs or services offered by respondent National Talent Associates, Inc. under its contract. Thus, respondents have failed to disclose material facts, which if known to potential purchasers, would be likely to affect their consideration of whether or not to enter into a Decision and Order 86 F.

contract to purchase said photographs or services. Therefore, the aforesaid acts and practices of respondents, as herein aneged were, and are, false, misleading, deceptive, unethical, oppressive and exploitative cause substantial injury to consumers, and constituted and now constitute unfair or deceptive acts or practices in commerce in violation of the Federal Trade Commission Act.

PAR. 11. Respondents have cooperated and acted together in the false, misleading, deceptive or unfair acts or practices set forth under Paragraphs Four through Ten of this complaint. Such joint or concerted activities constitute a scheme designed to obtain the signatures of persons to a contract with National Talent Associates, Inc. for the mutual financial benefit of the respondents. The use by respondents separately or collectively, whether directly or indirectly, or by permission or acquiescence, of the false, misleading, deceptive or unfair sales solicitation metbods, both written and oral and their failure to disclose relevant and material facts to potential purchasers of their photographs or services, has had, and now has the tendency and capacity to mislead and deceive members of the public into the erroneous and mistaken belief that such written and oral statements and representations were and are true and complete, and into the purchase of substantial quantities of respondents' photographs or services.

PAR. 12. The aforesaid acts and practices of respondents as herein alleged are all to the prejudice and injury of the public and of respondents' competitors and constitute unfair methods of competition in commerce and unfair or deceptive acts or practices in commerce within the intent and meaning of the Federal Trade Commission Act. DECISION AND ORDER The Commission having issued its complaint on Apr. 3, 1974, charging respondents named in the caption hereof with violation of the Federal Trade Commission Act, and respondents having been served with a copy of that complaint; and The Commission having withdrawn the matter from adjudication for the purpose of negotiating a settlement by entry of a consent order;andRespondents and counsel for the complaint having thereafter executed an agreement containing a consent order, an admission by respondents of all jurisdictional facts set forth in the complaint, a statement that the signing of the agreement by respondents is for settlement purposes only and does not constitute an admission by respondents that the law has been violated as set forth in such _... .. .

.l" . ''-'''A 1202 Decision and Order complaint, and waivers. and provisions as required by the Commission rules; and The Commission having considered the aforesaid agreement and having determined that it provides an adequate basis for appropriate disposition of this proceeding, and having thereupon placed such agreement on the public record for a period of sixty (GO) days, and having duly considered the comments filed thereafter, now, in further conformity with the procedure prescribed in its rules, the agreement is hereby accepted, the following jurisdictional findings are made, and the following order is entered:

1. Respondent National Talent Associates, Inc. a New .Jersey corporation, is a corporation organized, existing and doing business under and by virtue of the laws of the State of New .Jersey, with its office and principal place of business located at 280 Park Ave. Rutherford, N. !. It also maihtains an offce at IIO .Jericho Turnpike Floral Park, N.

2. Respondent National Talent Associates, Inc., an Illinois corporation, is a corporation organized, existing and doing business under and by virtue of the laws of the State of Ilinois, with its offce and principal place of business located at 3fi25 W. Peterson Ave., Chicago, II1. 3. Respondent National Talent Associates, Inc., a California corporation, is a corporation organized, existing and doing business under and by virtue of the laws of the State of California, with its office and principal place of business located at 1800 N. Highland Ave. Hollywood, Calif.

4. Respondents Sanford Storm and .Jerome P. Ashfield are officers of the three National Talent Associates corporate respondents named above. They formulate, direct and control the policies, acts and practices of said corporations, and their address is 280 Park Ave. Rutherford, N...

5. Respondent Willam Schuller Agency, Inc. is a corporation organized, existing and doing business under and by virtue of the laws of the State of New York, with its office and principal place of business located at GG7 Madison Ave., New York, N.

G. Respondent Monica Stuart is an officer of corporate respondent William Schuller Agency, Inc. She formulates, directs and controls the policies, acts and practices of said corporation and her address is the same as that of said corporation.

7. The Federal Trade Commission has jurisdiction of the subject matter of this proceeding and of the respondents, and the proceeding is in the public interest.

Decision and Order 86 F.

ORDER It is ordered That National Talent Associates, Inc., New Jersey, Illinois, and California corporations, their successors and assigns, and Sanford Storm and Jerome P. Ashfield, individually and as officers of said corporations, and said respondents' officers, agents, representatives and employees directly or through any corporation, subsidiary, division or other device, in connection with the advertising, offering for sale, sale and distribution of products or services in connection with the placement and employment of persons as models, actors, actresses or entertainers in the commercial advertising, talent, modeling or entertainment industries, in or affecting commerce as "commerce" is defined in the Federal Trade Commission Act, do forthwith cease and desist from representing, directly or indirectly, orally or in writing, that:

1. Respondents have received information that a person may possess the necessary personal or physical characteristics or other qualifications suitable for success in the commercial advertising, talent modeling or entertainment industries.

2. Referrals from past purchasers of their products or services are a sig-nificant source from which the names of potential purchasers have been obtained.

:J. Respondents have obtained the names of potential purchasers from a source which cannot be divulged.

4. Respondents, when requested, wil provide persons with the source from which the information referred to in their solicitation letters, solicitation phone calls, or in any other means of solicitation was obtained and the nature of such information, unless respondents provide such information when requested.

5. National Talent Associates, Inc. has the expertise essential for the judging and selection of the most qualified persons to be used as models, actors, actresses or entertainers in the commercial advertising, talent, modeling or entertainment industries. 6. National Talent Associates' salesmen, agents or representatives have the expertise essential to select and judge the suitability of persons as models, actors, actresses or entertainers in the commercial advertising, talent, modeling or entertainment industries. 7. Pen,om, who prior to an in-person interview have been solicited by National Talent Associates, Inc. have been selected on the basis that they may have the necessary personal or physical characteristics or other qualifications suitable for success in the commercial advertising, talent, modeling or entertainment industries. 1202 Decision anrl Order 8. The majority of National Talent Associates' income is derived from its personal management contracts and its ability to place persons under contract with the leading advertising, modeling, talent or entertainment agencies.

9. Persons are selected and offered contracts by National Talent Associates, Inc. only on the basis that they may possess the personal or physical characteristics or other qualifications suitable for success in the commercial advertising, talent, modeling or entertainment industries.

10. A person s chances for selection by Monica Stuart, the Willam Sehuller Agency, Inc., or by any person or agency, wil be aided increased or enhanced, by entering into a contract with National Talent Associates, Inc.

11. Access to Monica Stuart or to the Willam Schuller Agency, Inc. is available only to persons who contract with National Talent Associates, Inc.

12. Monica Stuart or the Wiliam Schuller Agency, Inc. review photographs of only those persons who have contracted with National Talent Associates, Inc.

13. National Talent Associates, Inc., a New Jersey corporatiun arranges for professional photographs to be taken of each person placed under its contract by an independent photographic studio. 14. Persons who contract with National Talent Associates, Inc. wil receive annually one black and white, 8 x 10 inch, photograph of children in the family not under contract, for a five-year period, or for any period in excess of the period in which said photograph is received without any obligation to purchase additional photographs at an added cost.

15. Natural color photographs of persons who contract with National Talent Associates, Inc. are submitted annually, for a five-year period, or for any period in excess of the period in which said photographs are submitted to Monica Stuart or to the Wiliam Schuller Agency, Inc., for her or their consideration and review, without disclosing that, unless the person comes back for rephotographing annually for a five year period, such person s photographs wil not be resubmitted to Monica Stuart or to the William Schuner Agency, Inc. 16. National Talent Associates, Inc. photographs other persons in a family in addition to the person whose name appears on its contract solely for the purpose of submitting said photographs to Monica Stuart of the William Schuller Agency, Inc. for her evaluation of their potential for the commercial advertising, modeling, talent or entertainment industries.

17. The remuneration received by Monica Stuart of the William Decision ami Order 86 F.

Schuller Agency, Inc., in connection with her consideration and review of photographs submitted to her by National Talent Associates, Inc., is derived solely from a percentage of the earnings of persons selected by her and placed under contract by the William Schuller Agency, Inc. 18. Persons placed under contract by National Talent Associates Inc. can reasonably anticipate significant or substantial earnings from paid employment in the commercial advertising, talent, modeling or entertainment industries as models, actors, actresses or entertainers. 19. Persons who contract wi,h National Talent Associates, Inc. may reasonably anticipate earning sums of money sufficient to provide for a college education or for any other such formal education. 20. A person s chances for selection as a model, actor, actress or entertainer by the commercial advertising, modeling, talent or entertainment industries is, in any way, enhanced solely because he or she is Black, Oriental, has red hair, freckles or because of his or her size, age or any other specific racial or personal characteristics. It is further ordered That respondents shall disclose the following information, in writing, in a clear and conspicuous manner to each person who is a prospective purchaser of any of their products or services, prior to entering into any agreement for the furnishing of such products or services, including the photographing of, or assistance , any such persons in seeking or obtaining employment opportunities as models, actors, actresses or entertainers in the commercial advertising, talent, modeling or entertainment industries. a. The number of persons who contracted with respondents for the purchase of photographs or services to be used in connection with the selection, placement or employment of persons in the commercial advertising, talent, modeling or entertainment industries, as models actors, actresses or entertainers, within the two calendar years immediately preceding the year in which the prospective purchaser was contacted, the number and percentage of such persons who obtained paid employment through the auspices of respondents, as well as the number of paid jobs and agency contracts obtained by such persons.

b. The total number of persons placed under contract by respondents in each of the following categories of gross annual earnings derived from paid employment in the commercial advertising, talent modeling or entertainment industries, as models, actors, actresses or entertainers, during the two calendar years immediately preceding the year in which the prospective purchaser was contacted by respondents: Under $100, $100 $250, $250-$500, $500 000, $1 000- 000 000- 000, $4 000 000, $6 000 OOO, $8 000, $8 000-$10 000 $10 000 and above.

1202 Decision and Ordcr c. Whether any financial agreement, arrangement or connection exists between respondents and any photographic studio to which they may refer prospective purchasers of their photographs or services. d. Whether any financial agreement, arrangement or connection exists between respondents and any person, firm or agency to whom photographs, or any other information, concerning the prospective purchaser of their products or services may be sent by respondents. e. The source or sources from which the names, addresses, or any other information about prospective purchasers, or about any other members of their immediate family, was obtained by respondents. At the time when the foregoing disclosures are made, respondents shall furnish the prospective purchaser of any of their products or services with a retainable duplicate copy of the disclosure document and secure from such prospective purchaser a signed acknowledgment of the receipt thereof on the properly dated original copy. The document containing the disclosurcs shall be headed Important Information and shall not contain information or representations other than those set forth above.

It is further ordered That respondents maintain, for a five-year period following the execution thereof, the originals of the signed acknowledgments of receipt of the disclosures described in the preceding paragraphs and make them available for examination and. copying, if necessary, by a duly authorized representative of the Federal Trade Commission, upon reasonable notice, during normal business hours.

It is further ordered That, if any representations are made by the respondents, their salesmen, representatives or agents, either expressly or impliedly, orally or in writing, pertaining to any standards qualifications or characteristics which a person must meet or possess before respondents wil agree to place such a person under contract photograph them or otherwise assist or render services to said person respondents shall maintain complete and detailed records as to such persons who have failed to meet or possess such standards, qualifications or characteristics, including their names, addresses, date of rejection, and the reason or reasons for their rejection by respondents. Such records shall be made available for examination and copying if necessary, by a duly authorized representative of the Federal Trade Commission, upon reasonable notice, during normal business hours. It is further ordered That the respondents named in Part I of this order shall submit to respondents Monica Stuart and the Wiliam Schuller Agency, Inc., for their inspection and evaluation, copies of all written promotional or sales materials, including but not limited to sales solicitation letters, contract forms, brochures, flyers, and sales Decision and Order 86 F.

presentation scripts. Said respondents wi1 submit said materials to Monica Stuart and the Wiliam Schuller Agency, Inc., on a continuing basis whenever there is a change, revision or modification of any of the materials.

It is further ordered That respondents shall cease and desist from: a. ailing to furnish the buyer with a fully completed receipt or copy of any contract pertaining to such sale at the time of its execution which is in the same language Spanish, as that principally used in the oral sales presentation and which shows the date of the transaction and contains the name and address of the seller, and in immediate proximity to the space reserved in the contract for the signature of the buyer or on the front page of the receipt if a contract is not used and in boldface type of a minimum size of 10 points, a statement in substantially the following form: YOU, THE BUYER, MAY CANCEL THIS TRANSACTION AT ANY TIMB; PRIOR TO MIDNIGHT OF THE THIRD BUSINESS DAY AFTER THE DATE OF THIS TRANSACTION. SEE THE AT1ACHB;D NOTICE : OF CANCELLATION FORM FOR AN EXPLANATION m' THIS RIGHT.

b. Failing to furnish each buyer, at tbe time he signs the door-todoor sales contract or otherwise agrees to buy consumer goods or services from the seller, a completed form in duplicate, captioned NOTICE OF CANCELLATION " which shall be attached to the contract or receipt and easily detachable, and which shall contain in ten point boldface type the following information and statements in the same language Spanish, as that used in the contract: NOTICE OF CANCELLATION (enter date of transaction) (Date) vou MAY CANCEL THIS TRANSACTION, WITHOUT ANY PENALTY OR OBLIGATION WITHIN THREE BUSINESS DAYS FROM THE ABOVE DATE. IF VOU CANCEL, ANY PROPERTY TRADED IN, ANY PAYMENTS MADI': BY YOU UNDER THE CONTRACT OR SALE, AND ANY NEGOTIABLE INSTRUMENT EXECUTED BY YOU Will HE Rf;TURNED WITHIN 10 BUSINESS DAYS FOLLOWING RECEIPT BY THE SELLER OF YOUR CANCELLATION NOTICE AND ANY SECURITY INTEREST ARISING OUT OF THE TRANSACTION WILL BE CANCf:LLED.

IF YOU CANCEL, YOU MUST MAKE AVAILABLE TO THE SELLER AT YOUR RESWENCB, IN SUBSTANTIALLY AS GOOD CONDITION AS WHEN RECEIVED, ANY GOODS DELIVERED TO YOU UNDER THIS CONTRACT OR SALE: OR YOU MAY IF YOU WISH, COMPLY WITH THl': INSTRUCTIONS OF THE SELLER REGARDING THE RETURN SHIPMENT OF THE Goons AT THi' SIiLLER S I-XPENSE AND RISK.

If YOU DO MAKE THE GOODS A V AILABLE TO THE SELLER AND THE SELLER DOES NOT 1202 Decision and. Order PICK UP WITHIN 20 DAYS OF THE DATE OF YOUR NOTICE OF CANCELLATION, YOU MAY RETAIN OR OlSPOSE OF THE GOODS WITHOUT ANY J.' URTIIER OBLIGATION. IF YOU FAIL TO MAKE THE GOODS AVAILABLE TO THE SELLER, OR IF YOU AGREE TO RETURN THE GOODS TO THE SELIJm AND FAIL TO DO SO, THEN YOU REMAIN LIABLE FOR PERFORMANCE OF ALL OBLIGATIONS UNDER THE CONTRACT. (AMENDED Nov. 1 19n). TO CANCEL THIS TRANSACTION, MAIL OR OELIVER A SIGNED AND DATED COPY m' THIS CANCELLATION NOTICE OR ANY OTHER WRITTEN NOTICE, GRSENO A TELEGRAM, TO (Name of seller), AT (address of sellers place of business) NOT LATI-R THAN MIDNIGHT OF (Date). I HEREBY CANCEL THIS TRANSACTION.

(DATE) (BUYER S SIGNATURE) c. Failing, before furnishing copies of the "Notice of Cancenation to the buyer, to complete both copies by entering the name of the seller the address of the seller s place of business, the date ofthe transaction and the date, not earlier than the third business day following the date of the transaction, by which the buyer may give notice of cancellation. d. Including in any door-to-door contract or receipt any confession of judgment or any waiver of any of the rights to which the buyer is entitled under this rule including sale in accordance with the provisions specifically his right to cancel the of this rule. e. Failing to inform each buyer orally, at the time he signs the contract or purchases the goods or services, of his right to cancel. f. Misrepresenting in any manner the buyer s right to cancel. g. Failing or refusing to honor any valid notice of cancellation by a buyer and within 10 business days after the receipt of such notice, to (i) refund all payments made under the contract or sale; (ii) return any goods or property traded in, in substantially as good condition as when received by the seller; (iii) cancel and return any negotiable instrument executed by the buyer in connection with the contract or sale and take any action necessary or appropriate to terminate promptly any security interest created in the. transaction. h. Negotiating, transferrng, sellng or assigning any note or other evidence of indebtedness to a finance company or other third party prior to midnight of the fifth business day following the day the contract was signed or the goods or services were purchased. i. Failng, within 10 business days of receipt of the buyer s notice of cancellation, to notify him whether the seller intends to reposses,' or to abandon any shipped or delivered goods.

Provided, however That nothing contained in this order shall relieve respondents of any additional obligations respecting contracts required by Federal law or the law of the State in which the contract is made. FEDERAL TRADJ. COMMISSION DJ.CISIONS Decision and Order 86 FTC.

When such obligations are inconsistent, respondents can apply to the Commission for relief from this provision with respect to contracts executed in the State in which such different obligations are required. The Commission, upon a showing of inconsistency, shall make such modifications as may be warranted in the premises. its It is ordered That William Schuller Agency, Inc., a corporation, successors and assigns, and Monica Stuart, individually and as an officer of said corporation, and respondents' officers, agents, representatives and employees directly or through any corporation, subsidiary, division or other device, in connection with the advertising, offering for sale, sale and distribution of products or services in connection with the placement and employment of persons as models, actors, actresses or entertainers in the commercial advertising, talent, modeling or isentertainment industries, in or affecting commerce as "commerce" defined in the Federal Trade Commission Act, do forthwith cease and desist from representing to consumers, directly or indirectly, orally or in writing, that:

1. A person s chances for selection by Monica Stuart, the William Schuller Agency, Inc. or by any person or agency, wil be aided increased or enhanced by entering into a contract with National Talent Associates, Inc.

2. Access to Monica Stuart or to the Wiliam Schuller Agency, Inc. is available only to persons who contract with National Talent Associates, Inc.

review :,. Monica Stuart or the Wiliam Schuller Agency, Inc., photographs of only those persons who have contracted with National Talent Associates, Inc.

4. National Talent Associates, Inc. photographs other persons in a family in addition to the person whose name appears on its contract solely for the purpose of submitting said photographs to Monica Stuart of the William Schuller Agency, Inc. for her evaluation of their potential for the commercial advertising, modeling, talent or entertainment industries.

5. The remuneration received by Monica Stuart of the Wiliam Schuller Agency, Inc., in connection with her consideration and review of photographs submitted to her by National Talent Associates, Inc., is derived solely from a percentage of the earnings of persons selected by her and placed under contract by the Wiliam Schuller Agency, Inc. 6. Natural color photographs of persons who contract with National Talent Associates, Inc. are submitted annually, for a five-year period or for any period in excess of the period in which said photographs are 1202 Decision and Ordcr submitted to Monica Stuart or to the Wilham Schuller Agency, Inc. for her or their consideration and review without disclosing that, unless the person comes back for rephotographing annually for a five-year period such person s photographs wil not be resubmitted to Monica Stuart or to the Wilham Schuller Agency, Inc.

It is further ordered That respondents Monica Stuart and Wiliam Schuller Agency, Inc. shall maintain complete and detailed records as to the number of persons whose photographs were submitted to them by any of the respondents set forth under Part I of the order herein, and the number of such persons who have failed to meet or possess the standards, qualifications or characteristics which a person must meet or possess before respondents herein wil agree to place such a person under contract, or otherwise assist or render services to said person including their names, place of residence, and month and year of rejection. Such records shall be made available for examination and copying if necessary by a duly authorized representative of the Federal Trade Commission, upon reasonable notice, during normal business hours.

It is further ordered That respondents Monica Stuart and Willam Schuner Agency, Inc. shall inspect and evaluate the written promotional and sales material submitted to them by respondents named in Part I of this order. Within 30 days of their receipt of said materials respondents Monica Stuart and Wiliam Schuller Agency, Inc. shall notify said other respondents, in writing as to any comments complaints they might have, or any corrections they might require concerning any representations relating to them contained in the materials submitted. Monica Stuart and Wilham Schuller Agency, Inc. shall simultaneously submit to the New York Regional Office a copy of such notification to the respondents named in Part I ofthis order. It is further ordered That respondents Monica Stuart and Wiliam Schuller Agency, Inc. shall notify the Federal Trade Commission, in writing, of any consumer complaints received by them concerning any of the respondents named in Part I of this order. Such notification shall be made to the New York Regional Offce within 30 days after receipt of the consumer complaint. This provision shall apply only to those complaints about representations by or practices of the respondents named in Part I which relate to respondents Monica Stuart and Willam Schuller Agency, Inc.

For the purposes of the following provisions of this order, unless otherwise specified, the term "respondents" shall include each of the respondents named heretofore in this order. 217-1B4 0 - 76 Decision and Order 86 F.

It is further o-rdered That respondents Wiliam Schuller Agency, Inc. and Monica Stuart shall forthwith deliver a copy of this order or a memorandum incorporating its provisions to all present and future employees engaged in the sale of said respondents' products or services and shall secure from each such person a signed statement acknowledging receipt of a copy of this order or the memorandum. It is further ordered That corporate respondents National Talent Associates, Inc. and individual respondents Sanford Storm and Jerome P. Ashfield shall forthwith deliver a copy of this order or a memorandum incorporating its provisions to all present and future salesmen or other employees engaged in the sale of said respondents products or services and shall secure from each such salesman or employee a signed statement acknowledging receipt of a copy of this order or the memorandum.

It is further o-rdered That respondent corporations shall forthwith distribute a copy of this order to each of their operating divisions. It is further ordered That each individual respondent shall promptly notify the Commission of any discontinuance of his or her present business or employment and of his or her affiliation with any new business or employment. Such notice shall include such respondent' current business address and a statement as to the nature of the business or employment in which he or she is engaged as well as a description of his or her duties and responsibilities. It is jilrther ordered That corporate respondents notify the Commission at least thirty (30) days prior to any proposed change in the corporate respondents such as dissolution, assignment, or sale resulting in the emergence of a successor corporation, the creation or dissolution of subsidiaries, or any other changes in the corporations which may affect compliance obligations arising out of this order. It is further ordered That the respondents shall within sixty days after service upon them of this order, file with the Commission a report, in writing, setting forth in detail the manner and form in which they have complied with this order.