International Masters Publishers Inc

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In THE MATTER OF INTERNATIONAL MASTERS PUBLISHERS INC.

CONSENT ORDER IN REGARD TO ALLEGED VIOLATION OF SEC. 5 OF THE FEDERAL TRADE COMMISSION ACT Docket C-3205. Complaint, Jan. 14, 1987—-Decision, Jan. 14, 1987 This consent order requires, among other things, a Los Angeles mail-order seller of recipe cards to honor cancellation and return requests in a timely manner and prohibits respondent from misrepresenting its return and cancellation policies. Appearances For the Commission: Jerome M. Steiner, Jr. For the respondents: Anne B. Roberts, O’Donnell & Gordon, Los Angeles, Calif.

COMPLAINT The Federal Trade Commission, having reason to believe that International Masters Publishers Inc., a corporation (“respondent”), has violated the provisions of the Federal Trade Commission Act, and it appearing to the Commission that a proceeding by it in respect thereof would be in the public interest, alleges: PARAGRAPH 1. Respondent International Masters Publishers Inc., is a California corporation. It has its principal office or place of business at 4929 Wilshire Blvd., Los Angeles, California. Par. 2. Respondent has advertised, offered for sale, sold, and distributed recipe cards directly to the public through a continuity sales program entitled “My Great Recipes.”

Par. 3. The acts or practices of respondent alleged in this complaint were in or affecting commerce.

Par. 4. In the course and conduct of its business, and in order to induce the sale of its recipe cards, respondent disseminated directly to consumers certain promotional materials and advertisements, an example of which is attached hereto as Exhibit A. Par. 5. Statements contained in said promotional materials included:

A. We'll also send you 72 additional cards for free examination. If you are not satisfied with these additional cards, simply return them. There is no obligation whatsoever.

Complaint 109 F.T.C.

B. [A]about every 3 to 4 weeks, we’ll send you an additional 3 packages of 24 recipe cards each, at $2.25 per package, plus a small charge for postage and handling. You are never under any obligation to accept a package of recipe cards. And, you may discontinue receiving recipes at any time. The free gifts are yours to keep regardless. I, Alleging violations of Section 5(a) of the Federal Trade Commission Act, the allegations of Paragraphs One through Five are incorporated herein by reference.

Par. 6. Through the use of the statements referred to in Paragraph Five, and others not specifically set forth therein, respondent represented, directly or by implication, that respondent would honor enrollment cancellation requests within a reasonable period of time. Par. 7. In truth and in fact, respondent did not honor enrollment cancellation requests within a reasonable period of time. In many instances, consumers who refused to pay for cancelled enrollments were billed and dunned by respondent for nonpayment, and had their accounts referred to collection agencies. Therefore, the representations set forth in Paragraph Six were, and are false and misleading, and the acts and practices described in this paragraph were, and are, unfair.

Par. 8. The representations, acts, and practices set forth above were likely to induce consumers to order respondent’s recipe cards and to receive and pay for recipe cards after cancellation. Respondent’s representations, acts, and practices thus caused substantial consumer injury that was not outweighed by countervailing benefits to consumers or competition and was not reasonably avoidable by consumers. Therefore, dissemination of respondent’s representations, and respondent’s acts and practices constituted and constitute unfair and deceptive acts and practices in violation of Section 5(a) of the Federal Trade Commission Act.

II.

Alleging violations of Section 5(a) of the Federal Trade Commission Act, the allegations of Paragraphs One through Five are incorporated herein by reference.

Par. 9. Through the use of the statements referred to in Paragraph Five, and others not specifically set forth therein, respondent represented, directly or by implication, that respondent would honor returns of recipe cards within a reasonable period of time. Par. 10. In truth and in fact, respondent did not honor returns of recipes cards within a reasonable period of time. In many instances, consumers who refused to pay for returned merchandise were billed INTERNATIONAL MASTERS PUBLISHERS INC. 11 9 Complaint and dunned, and had their accounts referred to collection agencies. Therefore, the representations set forth in Paragraph Nine were, and are, false and misleading, and the acts and practices described in this paragraph were, and are, unfair.

Par. 11. The representations, acts, and practices set forth above were likely to induce consumers to order respondent’s recipe cards and to pay for recipe cards returned to respondent. Respondent’s representations, acts, and practices thus caused substantial consumer injury that was not outweighed by countervailing benefits to consumers or competition and was not reasonably avoidable by consumers. Therefore, the dissemination of respondent’s representations, and respondent’s acts and practices constituted and constitute unfair and deceptive acts or practices in violation of Section 5(a) of the Federal Trade Commission Act.

Til.

Alleging violations of Section 5(a) of the Federal Trade Commission Act, the allegations of Paragraphs One through Four are incorporated herein by reference.

Par. 12. In the course and conduct of its business and for the purpose of collecting debts allegedly resulting from consumer purchases of recipe cards, respondent disseminated various collection and dunning notices to consumers. Examples of said notices are attached hereto as Exhibits B and C.

Par. 13. Statements contained in such materials included: A. Unless payment is received within ten days of this notice, your account will be forwarded to a national credit bureau which maintains a national delinquent account file. This alone may result in severe restrictions on your future credit transactions. B. Moreover, I will be compelled to forward your name to a national credit bureau which maintains a national delinquent account file. This could seriously impair your valued credit rating and restrict future credit dealings of all kinds until this matter is settled.

Par. 14. Through the use of the statements set forth in Paragraph Thirteen, and others not specifically set forth therein, respondent represented, directly or by implication, that referral of a consumer’s name to the credit reporting agency with which respondent deals may adversely affect the consumer’s ability to obtain credit for typical consumer transactions.

Par. 15. In truth and in fact, referral of a consumer’s name to the credit reporting agency with which respondent deals would not adversely affect the consumer’s ability to obtain credit for typical con- Complaint 109 F.T.C.

sumer transactions. Therefore, the representation set forth in Paragraph Fourteen was, and is, false and misleading. Par. 16. The representations set forth above were likely to mislead consumers into the erroneous belief that the representations were true and to induce the payment of alleged debts by virtue of said erroneous belief. Therefore, respondent’s representations constituted and constitute deceptive acts and practices in violation of Section 5(a) of the Federal Trade Commission Act.

Par. 17. The acts and practices of respondent as alleged in this complaint constitute unfair or deceptive acts or practices in or affecting commerce in violation of Section 5(a) of the Federal Trade Commission Act.

INTERNATIONAL MASTERS PUBLISHERS INC. 13 Complaint EXHIBIT A U.8. COURT ORDERS FREE RECIPES SENT TO SUBSCRIBERS OF REAL RECIPES OF THE WORLD Asa paid subscriber to Great Recipes of the World, you are entivied to al of the folowing by returning your enclosed rebate check:

Te RecipeCaris = -: GSE FREE! 33 DividerCards - §-3-80°: FREE! iBunkCarts - § 68°. FREE! 1 Recipe File - & 990°. FREE! Wel) also send you 72 additional cards for free examination. If you are not estisfied with these additions) cards, simply return them. There fe no obligation whatsoever. And the other free gifts are yours to keep regardless You must return the enclosed rebate check in order to receive your free gifs. The rebate check is not transferable — tt is made out to you, and can only be used by you alone. We can ahip only to the name on ths check (address corrections are acceptable.) These free gifts are offered in exchange for the balance of the “Great Recipes of the World" issues owed to you. “Great Recipes of the World” will no longer be publishing their magazine.

My Great Recipee®, a company well established in the recipe oard business, is making this offer as a way of introducing our recipes to you. However, by standing in the rebate check, you are not obligated to buy anything whatsoever! Once you send in your rebate check, we wil] send you al the jtams mantionad earlier. Then, about every 3 to 4 weeks, we'll send you an additional 3 packages af 24 recipe cards each, at $2.25 per package, phis a amal charge far postage and handling. You are never under any obligation to accept a package of recipe cards. And, you may discontinue reosiring recipes at any time. The free gifts are yours to keep regardless. Our recipes are quick and easy. Each recipe is beautifully photographed and protected with a special] laminated costing. All recipes are stain- proof, waterproof, and chip proof. If you should ever lose ons, we'll replace ft free of charge. FyHjbit A (over please) p. 1 oF 4 Mans Pfastore Gu Beast Qasinge SIN ERE M4 . . Complaint 109 F.T.C.

Bend in your rebate check today. The free gifts are yours to keep, by orderof the v.3. Court. But you must send in your rebate check to receive them! Burry, this offer expires May 31, 1985. send in your rebate check today. Sinoeraly, Ulery Wascis Mary Masters PS. — Remember, seriding in your rebate check doss not obligate you to buy anything We can only ship you your {ree gifts after we've received your rebate check. The reply envelope enclosed requires no postage.

exHisir A P2064 Mary Masters, My Great Raines tenner + INTERNATIONAL MASTERS PUBLISHERS INC. 15 9 Complaint My Great ‘Recipes’ 4029 Wilshire Blvd.

Los Angeles, CA 8001) The U.S. Court has giver, you the opportunity to exchange what is now basically s worthless subscription, for valuable products.

There's no obligation or hidden catch of any kind. My Great Recipes® is doing this because we know you'll be SO pleased with our quick and easy recipes, you'll want to buy More. By sending in your rebate ebeck, you'll] get a *taste® of our recipes. And we're so sure you']) hunger for more, we're willing to give you $18.95 worth of free gifts. Even though the balance of the issues oved you is less than $18.95, our policy is to make sure you're satisfied. We do that by giving you quick and easy recipes, better quality, top-notch Service, and valve. Our thousands of satisfied customers know this to be true.

Al} you have to do to receive your free gift is to check *yes® on your enclosed rebate check, and return in the enclosed postage-paeid envelope, Do it now, while you have this in your hand. There's no Obligation to buy anything.

Sincerely, Cue 8. Nllr Bric Killer Vice President My Great Recipes P.S. - The time limit on this offer makes it important for you to send back the rebate check today.

ns exHlBir A pz 7 Complaint NON— NEGOTIABLE Crap GREAT RECIPES OF THE WORLD My Great Recipes® PO. Box 76926 4929 Wilshire Bivd.

Los Angeles, CA 90010 oO YES! want to exchange the belance of the “Great Recipes of the World” iseuse owed to me for the offer outlined in this letter. | understand (he (ree gifts ere mine to keep with no obligation, by order of ihe U.S. court.

CD NO. 00 not exchange the belence of the “Great Recipes of the World" iseves owed to me for the offer outlined In thie letter. | understand that no additional Isaues of “Great Recipes of the World” magazine will be sent to me. | efeo am aware that the Court has mede no p tor sy bers other then the free gifte ee outlined in this letter.

Check one box only, and return in the enctosed postage petd envelope.

EIGHTEEN AND NINETY FIVE/100 DOLLARS | 8 95 PAY TO THE ZELMA G MANKHEY ba ORDER OF 16720 191ST PL NE Memo: This rebate check, H received by May 31, 1883 may WOODINVILLE, WA 96072 be used in exchange for Ine Ofte ouMBned in ihe ontowed PHYS: CAI. >. .

Non-transterable ei GIT TEM CYC GM 190699 Fice No. 86273262 wT te INTERNATIONAL MASTERS PUBLISHERS INC. 17 Complaint EXHIBIT B «My Great Recipes’ 4979 Washoe Bovteverd. Sule 600. Las Angetes CA 80070 (213) 935-9127 Dear Member:

By now you have received several sets of my great tasting recipes, but | was surprised to see you have not paid for any of them yet. Please take a moment to review the enziosed statement of your account, and if there are any problems let me know right away. The amount\ due reflects a total of all shipments sent to you thus far, however, you may not as of yet received the last shipment. Unless payment is received within ten days of this notice, your account will be forwarded to a national credit bureau which maintains a national! delinquent account file. This alone may result in severe restrictions on your future credit transactions. In order to avoid such a drastic measure please mail your check today using the enclosed envelope.

Cordially, Mary Masters MAKE CHECK QR MONEY Y ODER PAYABLE TO: KEEP THIS STUB My Great Recipes © 4929 WILSHIRE BLVD.. LOS ANGELES, CA $0010 PLEASE! Return ims portion with your [AMOUNT }5 1 13 1 4 9 1422 1791 67 21 96.322723 SHIPS 1 13 1 4 10 1513 1793 69 20 79.079391 DATES 1 13 1 4 11 1642 1794 49 21 79.079391 SETS 1 13 1 4 12 1714 1795 49 20 83.433739 NO.5 1 13 1 4 13 1810 1796 103 20 94.434525 AMOUNT4 1 13 1 5 0 731 1802 1185 56 -1 5 1 13 1 5 1 731 1829 80 16 15.015480 DAYMent5 1 13 1 5 2 817 1829 15 13 79.259171 ic5 1 13 1 5 3 839 1830 55 12 57.295288 sures 1 13 1 5 4 901 1830 61 15 91.355171 proper5 1 13 1 5 5 968 1829 114 19 47.457794 credits 1 13 1 5 6 1026 1815 13 37 86.080765 to5 1 13 1 5 7 1047 1829 35 19 93.492920 yours 1 13 1 5 8 1089 1802 75 49 64.928734 account.5 1 13 1 5 9 1178 1806 14 41 51.371468 D5 1 13 1 5 10 1212 1807 13 51 64.999718 |5 1 13 1 5 11 1250 1807 94 51 65.513611 42.165 1 13 1 5 12 1360 1807 18 51 88.985268 |5 1 13 1 5 13 1419 1819 146 23 91.543541 04/21/845 1 13 1 5 14 1623 1821 142 27 90.285477 20,21,225 1 13 1 5 15 1846 1824 70 22 92.954964 8.454 1 13 1 6 0 1419 1851 497 28 -1 5 1 13 1 6 1 1419 1851 144 23 92.703201 03/31/845 1 13 1 6 2 1621 1853 146 26 78.955040 32,33,545 1 13 1 6 3 1846 1855 70 23 90.118927 8.452 1 14 0 0 0 1580 1658 5 123 -1 3 1 14 1 0 0 1580 1658 5 123 -1 4 1 14 1 1 0 1580 1658 5 123 -1 5 1 14 1 1 1 1580 1658 5 123 95.000000 2 1 15 0 0 0 1656 1697 265 74 -1 3 1 15 1 0 0 1656 1697 265 74 -1 4 1 15 1 1 0 1656 1697 265 74 -1 5 1 15 1 1 1 1656 1697 265 74 95.000000 2 1 16 0 0 0 675 1773 909 9 -1 3 1 16 1 0 0 675 1773 909 9 -1 4 1 16 1 1 0 675 1773 909 9 -1 5 1 16 1 1 1 675 1773 909 9 95.000000 2 1 17 0 0 0 855 1869 175 15 -1 3 1 17 1 0 0 855 1869 175 15 -1 4 1 17 1 1 0 855 1869 175 15 -1 5 1 17 1 1 1 855 1869 41 12 54.604156 Wie5 1 17 1 1 2 902 1872 33 12 77.687241 you5 1 17 1 1 3 942 1871 62 11 8.498932 azcouy5 1 17 1 1 4 1011 1869 19 13 0.000000 No2 1 18 0 0 0 868 1930 508 8 -1 3 1 18 1 0 0 868 1930 508 8 -1 4 1 18 1 1 0 868 1930 508 8 -1 5 1 18 1 1 1 868 1930 508 8 95.000000 2 1 19 0 0 0 796 1955 580 7 -1 3 1 19 1 0 0 796 1955 580 7 -1 4 1 19 1 1 0 796 1955 580 7 -1 5 1 19 1 1 1 796 1955 580 7 95.000000 2 1 20 0 0 0 795 1863 1119 142 -1 3 1 20 1 0 0 795 1863 1119 142 -1 4 1 20 1 1 0 854 1863 1060 65 -1 5 1 20 1 1 1 854 1894 18 11 30.625999 or5 1 20 1 1 2 882 1893 44 13 0.000000 ece5 1 20 1 1 3 936 1863 102 65 6.746178 agence5 1 20 1 1 4 1420 1883 143 22 61.214172 03/10/845 1 20 1 1 5 1622 1884 144 27 61.214172 35,36,375 1 20 1 1 6 1846 1887 68 22 73.854149 3.424 1 20 1 2 0 796 1914 1118 58 -1 5 1 20 1 2 1 796 1931 74 22 34.329948 [YOURS 1 20 1 2 2 879 1938 98 16 65.712158 ACCOUNTS 1 20 1 2 3 987 1939 86 16 65.712158 NUMBERS 1 20 1 2 4 1088 1936 78 21 43.323116 |]5 1 20 1 2 5 1217 1939 50 17 0.000000 bates 1 20 1 2 6 1333 1938 44 21 23.638412 T_5 1 20 1 2 7 1419 1914 144 54 20.424660 ree5 1 20 1 2 8 1622 1916 48 53 22.449203 2%.5 1 20 1 2 9 1678 1917 87 54 38.581619 ae5 1 20 1 2 10 1845 1917 69 55 30.510338 ge4 1 20 1 3 0 795 1961 1080 44 -1 5 1 20 1 3 1 795 1962 206 39 5.473038 le3-151872975 1 20 1 3 2 1087 1962 5 41 37.769703 |5 1 20 1 3 3 1114 1961 195 42 16.194382 sofoaszaren5 1 20 1 3 4 1332 1962 6 43 75.899330 |5 1 20 1 3 5 1360 1962 17 43 75.899330 |5 1 20 1 3 6 1660 1964 66 10 33.183777 ou5 1 20 1 3 7 1868 1965 7 6 14.666931 °2 1 21 0 0 0 795 2000 581 8 -1 3 1 21 1 0 0 795 2000 581 8 -1 4 1 21 1 1 0 795 2000 581 8 -1 5 1 21 1 1 1 795 2000 581 8 95.000000 2 1 22 0 0 0 780 2070 326 52 -1 3 1 22 1 0 0 780 2070 326 52 -1 4 1 22 1 1 0 782 2070 271 22 -1 5 1 22 1 1 1 782 2070 68 21 94.477783 MISS5 1 22 1 1 2 877 2072 67 20 91.802460 LORI5 1 22 1 1 3 967 2072 86 19 88.059097 APGAR4 1 22 1 2 0 780 2099 326 23 -1 5 1 22 1 2 1 780 2099 55 22 92.747665 2005 1 22 1 2 2 859 2102 157 20 64.665833 LONE-TREES 1 22 1 2 3 1041 2103 30 19 4.251099 RD2 1 23 0 0 0 1791 2192 125 6 -1 3 1 23 1 0 0 1791 2192 125 6 -1 4 1 23 1 1 0 1791 2192 125 6 -1 5 1 23 1 1 1 1791 2192 125 6 95.000000 2 1 24 0 0 0 1792 2191 3 79 -1 3 1 24 1 0 0 1792 2191 3 79 -1 4 1 24 1 1 0 1792 2191 3 79 -1 5 1 24 1 1 1 1792 2191 3 79 95.000000 2 1 25 0 0 0 1913 2194 2 78 -1 3 1 25 1 0 0 1913 2194 2 78 -1 4 1 25 1 1 0 1913 2194 2 78 -1 5 1 25 1 1 1 1913 2194 2 78 95.000000 2 1 26 0 0 0 781 2132 1132 127 -1 3 1 26 1 0 0 781 2132 1132 127 -1 4 1 26 1 1 0 781 2132 512 24 -1 5 1 26 1 1 1 781 2132 164 20 95.743904 HOLLISTER5 1 26 1 1 2 1149 2135 29 20 88.938423 CA5 1 26 1 1 3 1205 2133 88 23 88.938423 950234 1 26 1 2 0 1813 2199 88 16 -1 5 1 26 1 2 1 1813 2199 88 16 96.520195 AMOUNT4 1 26 1 3 0 1057 2220 856 39 -1 5 1 26 1 3 1 1057 2226 430 26 74.628677 0103231518729700942160155 1 26 1 3 2 1606 2220 181 39 0.000000 uronnecer.5 1 26 1 3 3 1770 2216 32 52 31.801826 P|5 1 26 1 3 4 1824 2233 89 22 85.996078 42.162 1 27 0 0 0 1792 2267 124 5 -1 3 1 27 1 0 0 1792 2267 124 5 -1 4 1 27 1 1 0 1792 2267 124 5 -1 5 1 27 1 1 1 1792 2267 124 5 95.000000 2 1 28 0 0 0 705 2265 239 21 -1 3 1 28 1 0 0 705 2265 239 21 -1 4 1 28 1 1 0 705 2265 239 21 -1 5 1 28 1 1 1 705 2265 86 19 95.931915 RETURNS 1 28 1 1 2 797 2268 47 16 95.979568 THIS5 1 28 1 1 3 851 2268 93 18 96.587006 PORTION2 1 29 0 0 0 1237 2394 264 66 -1 3 1 29 1 0 0 1237 2394 264 66 -1 4 1 29 1 1 0 1237 2394 264 66 -1 5 1 29 1 1 1 1237 2394 199 66 31.694420 exhibits 1 29 1 1 2 1460 2400 41 48 90.998970 B2 1 30 0 0 0 645 2357 198 187 -1 3 1 30 1 0 0 645 2357 198 187 -1 4 1 30 1 1 0 645 2357 198 187 -1 5 1 30 1 1 1 645 2357 198 187 95.000000 Complaint 109 F.T.C.

EXHIBIT C (My Great Recipes ° up When Dantes fate OD. Ls foe. CA OO B- M? Ose Mernber:

Your account is now senovusly past due. You have failed to live up to the terns of your membership agreement.

And, you have failed to advise us of any problems as we patiently asked. So, we can only assume you are using and enjoying the recipes we have sent you thus fay, in good faith.

Ihave been forced to hall any further shipments, 8 step we always take with greatest regrets. Your 10-day evaluation period has expired: - You cannot retum the recipes we sent under terms of our agreement. However, this in no way cancets your ovistanding balance owed. Moreover, | will be compelled to forward your name to 8 national could seriously impas your valued credit rating and restrici fulure credit Geaings of all kinds unti this matter is sefted. ‘This is 8 Grastc measure. | would much rather receive your check within the next ten days and avoid such action. Creck and Collection Manager <yHIBIT C INTERNATIONAL MASTERS PUBLISHERS INC. 19 9 Decision and Order DECISION AND ORDER The Federal Trade Commission having initiated an investigation of certain acts and practices of the respondent named in the caption hereof, and the respondent having been furnished thereafter with a copy of a draft of complaint which the San Francisco Regional Office proposed to present to the Commission for its consideration and which, if issued by the Commission, would charge respondent with violation of the Federal Trade Commission Act; and The respondent, its attorney, and counsel for the Commission having thereafter executed an agreement containing a consent order, an admission by the respondent of all the jurisdictional facts set forth in the aforesaid draft of complaint, a statement that the signing of said agreement is for settlement purposes only and does not constitute an admission by respondent that the law has been violated as alleged in such complaint, and waivers and other provisions as required by the Commission’s Rules; and The Commission having thereafter considered the matter and having determined that it had reason to believe that the respondent has violated the said Act, and that complaint should issue stating its charges in that respect, and having thereupon accepted the executed consent agreement and placed such agreement on the public record for a period of sixty (60) days, now in further conformity with the procedure prescribed in Section 2.34 of its Rules, the Commission hereby issues its complaint, makes the following jurisdictional findings and enters the following order:

1. Respondent International Masters Publishers Inc. is a corporation organized, existing, and doing business under and by virtue of the laws of the State of California, with its offices and principal place of business located at 4929 Wilshire Blvd., Los Angeles, California. 2. The Federal Trade Commission has jurisdiction of the subject matter of this proceeding and of the respondent, and the proceeding is in the public interest.

ORDER For purposes of this order, the following definitions shall apply: A. Continuity sales plan means a sales plan requiring the consumer to receive periodic installments of merchandise or services on approval.

B. Billing cycle means that period of time between the sending of one scheduled invoice or billing document (whether accompanying a Decision and Order 109 F.T.C.

shipment of goods or not) and the sending of the following scheduled invoice or billing document.

C. Return means any item returned under the provisions of a continuity sales plan, as defined above.

D. Received by respondent or receipt by respondent includes material received at any mail drop respondent has established. I.

It is ordered, That respondent International Masters Publishers Inc. (“IMP”), its successors and assigns, and their officers, agents, representatives, and employees, directly or through any corporation, subsidiary, division, or other device, in connection with the advertising, offering for sale, sale or distribution of recipe cards or any other product or service by means of a continuity sales plan in or affecting commerce, as “commerce” is defined in the Federal Trade Commission Act, as amended, do forthwith cease and desist from: A. Misrepresenting in any manner, directly or by implication, any term or condition for cancellation of enrollment or return of merchandise, or misrepresenting, in any manner, directly or by implication, any right granted to, or any duty or obligation imposed on, any consumer.

B. Failing, by the end of the first billing cycle following the billing cycle in which a consumer’s request for cancellation of enrollment is received by respondent, to cancel that consumer’s enrollment, and, if thereafter the consumer is contacted in connection with any obligation arising out of the enrollment, to notify that consumer in writing that the enrollment has been cancelled.

C. Sending a consumer more than one additional installment of merchandise following receipt by respondent of an enrollment cancellation request.

D. Failing, by the end of the first billing cycle following the billing cycle in which a consumer’s return of merchandise or goods is received by respondent, to credit that consumer’s account for the return, and, if thereafter the consumer is contacted in connection with any obligation arising out of the enrollment, to notify the consumer in writing that the account has been credited for the return; provided, however, that such written notification may be made in a scheduled billing document or in a separately mailed document. E. Failing to include in the first communication from respondent to each consumer following enrollment in any of respondent’s continuity sales programs the statement attached hereto as Attachment A, or a statement similar thereto, explaining return and cancellation poli- INTERNATIONAL MASTERS PUBLISHERS INC. 21 9 Decision and Order cies; provided, however, that should respondent represent to consumers that cancellations of enrollment, credits for returns of merchandise, or the sending of written confirmations thereof will be accomplished in a shorter time than required under Paragraphs I. B or I. D of this order, respondent, its successors and assigns, shall amend Attachment A to conform with such representation. Il.

It is further ordered, That respondent International Masters Publishers Inc., its successors and assigns, and their officers, agents, representatives, and employees, directly or through any corporation, subsidiary, division, or other device, in connection with the advertising, offering for sale, sale or distribution of any recipe card or other product or service in or affecting commerce, as “commerce” is defined in the Federal Trade Commission Act, do forthwith cease and desist from representing, in any manner, directly or by implication, that any consumer’s credit rating will or may be adversely affected, or representing, in any manner, directly or by implication, that there will or may be any adverse consequence to failing to pay any amount claimed to be delinquent, unless there is a reasonable likelihood such rating will be so affected or such consequence will occur. Il.

It is further ordered, That for five (5) years after the date of service of this order respondent, its successors and assigns shall maintain, and upon written request make available to the Federal Trade Commission for inspection and copying the following records: A. For a period of two (2) years from the date of receipt, all documents containing, reflecting, or referring to each consumer complaint relating to cancellation of enrollment in a continuity sales plans, return of merchandise, alleged billing error, or collection effort, as well as such documents or records as will disclose any response thereto.

B. For a period of one year from the date of receipt, copies of each written request for cancellation of enrollment received during the week starting with the third Monday of each month. C. For a period of one year from the date of preparation, records sufficient to show the date on which each return of merchandise and request for cancellation was made effective. D. For a period of two years from the date of their last use, specimen copies of all form communications, promotional materials, and adver- Decision and Order 109 F.T.C.

tisements as well as documents sufficient to show the period of time when such documents or materials were in use. IV.

It is further ordered, That respondent shall notify the Commission at least thirty (30) days prior to any proposed change in the 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 that may affect compliance obligations arising out of the order. V.

It is further ordered, That respondent shall, within sixty (60) days after service upon it of this order, submit to the Commission a report, in writing, setting forth in detail the manner and form in which it has complied with this order.

ATTACHMENT A IMPORTANT INFORMATION: PLEASE RETAIN FOR YOUR RECORDS RETURNING MERCHANDISE To return merchandise to us at no cost to you, simply place the goods in the original package, reseal it, and deposit it in a mailbox. Please allow up to two billing cycles {number of days in two billing cycles] for us to process the return. If you receive an invoice or other request for payment for the merchandise returned, you do not need to pay it.

CANCELLATION INFORMATION You may cancel your enrollment in our program by calling, [number] or by writing to us at [address]. Please allow up to two billing cycles [number of days in two billing cycles] for us to process the cancellation. In some circumstances, because of unforseen delays, you may receive one additional shipment from us. If so, merely return the merchandise and any enclosed invoice to us. You will not be charged for that shipment. SOLAR AGE INDUSTRIES, INC. 23 23 Complaint