Owens-Corning Fiberglas Corporation

Text (OCR of the scan at left; may contain errors)

IN THE MATTER 01' OWENS-CORNING FIBERGLAS CORPORATION MODIFYING ORDER IN REGARD TO ALI.EGED VIOLATION OF THE FEDERAL TRADE COMMISSION ACT Docket C-2R42. Decision. Sept. JO, 1.976-Modijjing Order. Jan. 981 This order reopens the proceeding and modifies the Commission order issued on September 30 1976 (41 FR 50811 , 88 F.T.C. 465), by substituting for the order in its entirety, a modified order which retains the major requirements of the original order and provides that upon the effective date of the Commission Trade Regulation Rule on Labeling and Advertising of Home Insulation (the Rule), any provision of the order which is inconsistent with a provision in the Hule be deemed automatically deleted. The order also provides for the reinstatement of the deleted provision, should the relevant provision of the Rule be rescinded, invalidated or amended. ORDER GRANTING REQUEST To REOPEN THE PROCEEDING AND MODIFYING ORDER To CEASE AND DESIST Respondent, Owens-Corning Fiberglas Corporation, having requested, on July 15, 1980, that the Commission reopen the proceeding in Docket No. C-2842 for the purpose of modifying the Order to Cease and Desist entered in that matter; and The Commission having placed such request, together with supporting documents attached thereto, upon the public record for a period of thirty (30) days, pursuant to Section 2.51 of its Hules; and The Commission being of the opinion that the public interest would be served by such reopening of the proceedings; Now therefore, it is ordered That the proceeding in Docket No. C- 2842 be, and it is hereby, reopened; and It is further ordered That the Order entered in Docket No. C-2842 be modified by substituting for the Order in its entirety the following Modified Order:

It is ordered, That respondent Owens-Corning Fiberglas Corporation, a corporation, its successors and assigns, and respondent' offcers, agents, representatives and employees, directly or indirectly or through any corporation, subsidiary, division or other device, in connection with consumer advertising, offering for sale, sate, or distribution of flbrous glass insulation for residential buildings, in or affecting commerce, as "commerce" is defined in the Federal Trade Commission Act, do forthwith cease and desist from: 18(j FEDERAL TRADE COMMISSJON DECISIONS Modifying O der !J7 F.T.C A. Directly or by implication misrcpresenting in any advertising or sales promotion material, that respondent has a reasonable basis for statements or representations which are made concerning the amount of energy or money the consumer can save as a result of installing said insulation, or concerning any rccommended level of insulation, including an U-value recommendation. B. Directly or by implication making any statements or representations in any advertising or sales promotion material, concerning insulating characteristics of said insulation, concerning savings in money or energy which consumers can realize as a result of installing said insulation, or concerning any recommended level of insulation, including an R value recommendation, unless at the time of such statements or representations respondent has a reasonable basis for such statements or representations. Such reasonable basis shall consist of competent scientific, engineering, or other objective material, or industry-wide standards based on such material, or reliance upon governmental laws regulations, orders, standards or recommendations; provided, however, that in the case of reliance on governmental laws, regulations, orders, standards or rccommendations: (1) such laws, regulations orders, standards or recommendations must have been finally adopted by the agency involved; (2) such laws, regulations, orders standards, or recommendations must be applicable to the context of the advertisement or sales promotion material and must not render any portion of the advertisement or sales promotion material misleading; and (3) the agency promulgating such laws, regulations, orders, standards, or recommendations must be identified. C. Directly or by implication misrepresenting, in any advertising or sales promotion material, the amount of energy or money which a consumer can save by installing said insulation, or by installing any recommended level of insulation, including any recommended Rvalue.

D. Directly or by implication misrepresenting, in any advertising or sales promotion material, the facts, conditions, and/or assumptions which form the basis for energy savings claims, money savings claims, or R-value recommendations.

E. Failing to disclosc in advertising or sales promotion material containing money or energy savings claims, facts, conditions and/or assumptions which, within the confines of the medium being used are significant to the consumer and which affect the amount of money and energy a consumer can save by installing said insulation or by installing any recommended level of insulation, including any g., vvv f'--n.:- ..vn. Jj'HJ J' ll)J' ,l\'-Ud\u '-,VHJ l:!S Modifying Order recommended R-value (e. whether the savings claimed have taken into account the cost of the insulation and installation thereof). It is further ordered, That any provision of this order that is inconsistent with any provision of the Commission s Trade Regulation Rulc on Labeling and Advertising of Home Insulation (the Rule), as such provision is finally made effective, shall be deemed deleted to the extent of such inconsistency. This deletion shall be considered to have occurred on the date such provision of the Rule becomes effective. If such provision of the Rule shall be rescinded invalidated or amended, the deleted provisions shall be automatically reinstated. Such reinstatement shall be considered to have occurred sixty (60) days after the date of the rescission, invalidation or amendment.

It is further ordered, That respondent Owens-Corning Fiberglas Corporation, a corporation, its successors and assigns, and respondent' s officers, agents, representatives and employees, directly or through any corporation, subsidiary, division or other device, in connection with consumer advertising, offering for sale, sale, or distribution of fibrous glass insulation for residential buildings, in or affecting commerce, as "commerce" is defined in the Federal Trade Commission Act, do forthwith cease and desist from failing to maintain and produce accurate records which may be inspected by Commission staff members upon reasonable notice: A. Which consist of documentation in support of any claims included in advertising or sales promotion material, insofar as the text of such material is prepared or is authorized and approved by any person who is an officer or employee of respondent Owens- Corning Fiberglas Corporation, or of any division or subdivision of respondent, or by any advertising agency engaged by respondent or by any such division or subsidiary, which concern the insulating characteristics of said insulation or the savings which consumers can realize from the installation of said insulation or of any recommended level of insulation, including any recommended R-value; and B. Which provided the basis upon which respondent relied as of the time those claims were made; and C. Which shall be maintained by respondent for a period of three :14,,-:;:;4 O- J:1H FEDERAL TRADE COMMISSION DECJSIONS Modifying Order nJ- (3) years from the date such advertising or sales promotion material was last disseminated.

It is further ordered, That the respondent corporation shall forthwith distribute a copy of this order to each of its operating divisions selling or distributing said insulation. 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, assignment, or sale resulting in the emergence of a successor corporation, the crcation or dissolution of subsidiaries engaged in the domestic sale or distribution of fibrous glass insulation for residential buildings, or any other change in the corporation which may affect compliance obligations arising out of the order.

It is further ordered, That respondent herein shall file with the Commission a report, in writing, setting forth in detail the manner and form in which it has complied with this order, on the following dates:

Within sixty (60) days after service upon it of this order; On July 1 , 1981; and On January 31, 1982.

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139 Decision and Order