Lenox, Incorporated

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IN THE MA'IER OF LENOX, INCORPORATED MODIFYING ORDER IN REGARD TO ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSION ACT Docket 8718. Final Order, April 1968-Modifying Order, July, 1982 This order reopens the proceeding and modifies the Commission s modified order issued on June 24, 1970, 77 F. C. 860, by deleting Paragraph 8 from the order, so as to allow Lenox to prevent transshipping of its products by its authorized dealers. The Commission has also included a provision which prevents Lenox from taking disciplinary action against any dealer for transshipment which occurred before the effective date of the order. DECISION AND ORDER Whereas a "Request of Lenox, Incorporated for Modification of Final Order" was fied by Respondent on March 15, 1982 pursuant to Section 5(b) of the Federal Trade Commission Act, 15 U. C. 45(b), and Section 2.51 of the Commission s Rules of Practice, 16 C. , wherein Lenox, Incorporated seeks a partial modification of the order that issued on June 24, 1970 by the deletion of Paragraph 8; and Whereas the matter was thereafter placed on the public record for thirty (30) days pursuant to Section 2.51(c) of the Commission s Rules of Practice, 16 C. R. 2.51(c), during which time comments from the public were received; and Whereas the Commission thereafter considered the Petition presented by Lenox, Incorporated and all of the materials and information submitted as public comments on the petition and has determined that the request makes a satisfactory showing that changed conditions of fact and law and the public interest 'require that the order be reopened for the purpose of modification. Accordingly, it is ordered that the matter is reopened and that the order is modified by deleting the language of paragraph 8 that reads: Requiring or inducing, by any means, dealers or prospective dealers to refrain, or to agee to refrain, from resellng respondent' s products to any dealers or distributors; It is further ordered, That paragraphs 9 and 10 be renumbered to 8 and 9.

It is further ordered That nothing herein shall be construed to permit respondent to terminate or otherwise discipline any dealer for (1) having resold respondent's products to any dealer or distributor prior to the effective date of this order or (2) for any such resale Modifying Order 100 F. that occurs prior to the dealer s receipt of notice that it may be disciplined for such resale.

Commissioner Bailey voted in the negative. SEPARATE STATEMENT OF COMMISSIONER PERTSCHUK 1 wish to make clear why I voted for Lenox s petition to modify the Commission order prohibiting it from engaging in resale price maintenance. The petition persuaded me that the ban on transshipping, which was included in the order originally only as an ancillary means of deterrence, was no longer a necessary safeguard against vertical price fixing by Lenox and could safely be dropped from the order. The petition argued that the requested relief was also necessary to maintain a strong Lenox presence and vigorous interbrand competition in the houseware china business, and that it would not cause a rollback of the gains in intrabrand competition that have occurred during the life of the order. In this regard, I found the petition to be much less persuasive. I do not believe it has been established in this reopening proceeding that competition in the china industry wil be improved as a result of allowing Lenox to prevent transshipping of its products by its authorized dealers. However, since Lenox has met the statutory standard for modifying orders by showing that the ancilary transshipping provision is no longer appropriate under the circumstances, it is entitled to the relief granted.

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261 Complaint