Private Home Study Schools
16 CFR Part 116 · Trade practice rules · in the Code of Federal Regulations 1938-1973 (11 annual editions)
Scanned CFR pages, OCR text may contain errors; the linked Library of Congress PDF is the authority. Not legal advice; not affiliated with the FTC. These rules and guides are historical: most were rescinded or replaced, so do not assume any is in force.
Latest edition: Library of Congress, 1973 CFR · Earliest edition: 1938 CFR
Text (1973 edition, OCR)
Chapter I—Federal Trade Commission
Advertising, representing, branding or
labeling of any such honey product with-
out fully disclosing that the same is
honey preserve, honey jam, honey jelly
or honey apple butter, as the case may
be, or without setting forth the word
“honey” as prominently or conspicuously
as any other word used as descriptive of
the product, with the capacity and tend-
ency or effect of misleading or deceiving
purchasers, prospective purchasers or
the consuming public, is an unfair trade
practice within the meaning of this
section.
(f) When advertising, representing,
branding or labeling any preserve, jam
or jelly containing substantial amounts
of two or more fruits, although made in
conformity with the applicable require-
ments of paragraphs marked (a), (b),
(d) or (e) of this section, the kinds of
fruit so contained in such products
should be prominently and conspicuously
disclosed and named on the label in the
order of their predominance by weight.
Advertising, representing, branding or
labeling of any preserve, jam or jelly as
containing two or more fruits when each
such fruit is not present in substantial
and characterising amounts, with the
capacity and tendency cr effect of mis-
leading or deceiving purchasers, pro-
spective purchasers or the consuming
public, is an unfair trade practice within
the meaning of this section.
(g) The word sugar as used in this
section means sucrose or dextrose, or a
combination thereof.
§ 114.2 Disclosure in respect to imi-
tations.
The practice of advertising, labeling,
branding, selling or offering for sale an
imitation preserve, jam, jelly, or apple
butter, without clearly and prominently
disclosing therein that the product is
such imitation, with the tendency and
capacity or effect of misleading or de-
ceiving purchasers, prospective pur-
chasers or the consuming public, is an
unfair trade practice. For purposes of
this section:
(a) Products which contain a smaller
proportion of fruit than specified in the
applicable requirements set forth in
§114.1 (a), (b), (c), (d) and (e), or
which otherwise fail to conform with the
applicable minimum requirements set
forth in such paragraphs, respectively,
and which simulate or imitate preserves,
jams, jellies or apple butter as described
in such paragraphs, and which are used
§ 114.3
or sold for the same purpose, except fruit
pie filling, fruit sauce, fruit butter other
than apple butter, mint, wine and calves-
foot jellies, described, represented, la-
beled and sold as such, and preserved
citrus fruit products, is understood to be
imitation preserve, imitation jam, imita-
tion jelly or imitation apple butter, re-
spectively; and to avoid deception and
confusion of the purchasing public they
should be described, represented, labeled
and sold as such respective imitation
products.
§ 114.3 False invoicing.
Withholding from or inserting in the
invoice statements which make the in-
voice a false record, wholly or in part,
of the transaction represented on the
face thereof, with the purpose or effect
of misleading or deceiving purchasers,
prospective purchasers or the consuming
public, is an unfair trade practice.
PART 116—PRIVATE HOME STUDY
SCHOOLS
Group I
Sec.
116.1 False advertising, etc.
116.2 False representations as to earnings.
1163 Misrepresentation as to opportuni-
ties.
116.4 False representations as to student
employment or school’s connection
with United States Government.
116.5 False promises as to employment or
increased earnings.
1166 Limited time offers.
116.7 Misrepresenting offers as “special.”
116.8 Fictitious prices.
116.9 Money-back agreements.
116.10 Misleading scholarship offers.
116.11 Misuse of word “‘free.”
116.12 Defamation of competitors.
116.18 Deceptively advertising character
and scope of institution.
116.14 Deception in issuance of diplomas,
degrees, etc.
116.15 Falsely representing courses of study.
116.16 Misrepresentation as to faculty, ad~
visory board, instruction matertais,
etc.
116.17 Misrepresentation as to personal in~
struction.
116.18 Deceptive “Help Wanted” advertis-
ing.
116.19 Blind advertising.
116.20 Deceptive language in general.
116.21 Misuse of word “guarantee.”
116.22 Simulation of legal documents.
116.23 Photographic misrepresentations.
116.24 Misuse of national emblems, pictures,
of United States Capitol, and simi-
lar devices, connoting Government
endorsement.
529
§ 116.1
Sec.
116.25 Misuse of words, “not for profit.”
116.26 Unqualified students,
Group II
“Money-back” agreements.
Selection of sales representatives.
Dissemination of adequate informa-
tion to prospective students.
Precautions in avoidance of decep-
tive statements by sales repre-
sentatives.
COMMITTEEE ON TRADE PRACTICES
116.101
116,102
116.103
116.104
116.201 Industry committee.
AuTHorITY: The provisions of this Part 116
issued under secs. 6(g), 5, 38 Stat. 722, 719;
15 U.S.C. 46(g), 45, unless otherwise noted.
Source: The provisions of this Part 116
contained in trade practice rules, Private
Home Study Schools, FTC, Nov. 2, 1936, un-
less otherwise noted.
Group I
$116.1 False advertising, ete.
The making, or causing or permitting
to be made or published, any false, un-
true, or deceptive statement or represen-
tation, by way of advertising or other-
wise, concerning home study schools,
their activities in attempting to enroll
students, or concerning the character,
nature, quality, value, or scope of any
course of instruction or educational serv-
ices offered, or in any other material re-
spect, with the tendency or capacity to
mislead or deceive students, prospective
students, or the public, is an unfair trade
practice.
§ 116.2 False representations as to earn-
ings.
The making of false, untrue, or decep-
tive statements or representations re-
garding actual or probable earnings or
opportunities in any vocation, with the
tendency or capacity to mislead or de-
ceive students, prospective students, or
the public, is an unfair trade practice.
§ 116.3 Misrepresentation as to oppor-
tunities.
The making of false, untrue, or de-
ceptive statements or representations
regarding the opportunities in any voca-
tion or field of activity as a result of the
completion of any given course of in-
struction or educational service, with the
tendency or capacity to mislead or de-
ceive students, prospective students, or
the public, is an unfair trade practice.
Title 16—Commercial Practices
§ 116.4 False representations as to stu-
dent employment or school’s connec-
tion with United States Government.
The making of false, untrue, or decep-
tive statements or representations as to
services to be rendered in connection
with the securing or attempting to secure
employment for students, or as to the in-
fluence or connection of any school or
schools with any branch, department, or
establishment of the United States Gov-
ernment, with the tendency or capacity
to mislead or deceive students, prospec-
tive students, or the public, is an unfair
trade practice.
§ 116.5 False promises as to employ-
ment or increased earnings.
The making of false, untrue, or de-
ceptive promises or representations re-
garding a job or a raise in pay upon com-
pleting a certain course of instruction
or portion thereof, with the tendency or
capacity to mislead or deceive students,
prospective students, or the public, is an
unfair trade practice.
§ 116.6 Limited time offers.
Representing an offer to be limited as
to time or otherwise when such is not the
fact, with the tendency or capacity to
mislead or deceive students, prospective
students, or the public, is an unfair trade
practice.
§ 116.7 Misrepresenting offers as “spe-
cial.”
Representing an offer as “special”
when it is in fact a “regular” offer with
the tendency or capacity to mislead or
deceive students, prospective students, or
the public, is an unfair trade practice.
§ 116.8 Fictitious prices.
Offering courses of instruction at
prices purported to be reduced from what
are in fact marked-up or fictitious prices,
with the tendency or capacity to mislead
or deceive students, prospective students,
or the public, is an unfair trade practice.
§ 116.9 Money-back agreements.
It is an unfair trade practice for any
member of the industry to use, directly or
indirectly, and so-called ‘‘money-back’”’
guarantee, refund agreement or other
similar guarantee, agreement or contract
between school and student, which (a)
is conditioned upon the student taking
or passing, or having the opportunity
530
Chapter !—-Federal Trade Commission
to take or pass, a future Government or
civil service examination or test, or any
other form of future examination or test
given by any organization not affiliated
with the school; or (b) is conditioned
upon the student being placed upon a
Government or other eligible list; or (c)
is conditioned upon the student securing
or having the opportunity to secure em-
ployment within the field of training
pursued; or (d) is conditioned upon any
other contingency; and which has the
capacity, tendency or effect of mislead-
ing or deceiving students or prospective
students because of the text of such
guarantee, agreement or contract, or
because of the representations regarding
the same, or because of the circum-
stances or other conditions of its use, or
which otherwise involves deception, mis-
representation, bad faith, or the decep-
‘tive concealment of pertinent facts.
§ 116.10 Misleading scholarship offers.
Making offers of scholarships or par-
tial scholarships in such manner as to
mislead or deceive students or prospec-
tive students into the belief that such
offers are bona fide, when they are in fact
not bona fide, is an unfair trade practice.
§ 116.11 Misuse of word “free.”
Representing any commodity or serv-
ice as “free” when in fact such commod-
ity or service is regularly included as part
of the course of instruction or service,
with the tendency or capacity to mislead
or deceive students, prospective students,
the public, is an unfair trade practice.
§ 116.12 Defamation of competitors.
The defamation of competitors by
falsely imputing to them dishonorable
conduct, inability to perform contracts,
‘questionable credit standing, or by other
false representations, or the false dispar-
agement of the character, nature, qual-
ity, value or scope of their courses of
instruction or educational services, or in
any other material respect, with the
tendency or capacity to mislead or de-
ceive students, prospective students, or
the public, is an unfair trade practice.
§ 116.13 Deceptively advertising char-
acter and scope of institutiou.
The use of any name, title, or other
designation, by way of advertising or
otherwise, having the tendency or capac-
ity to mislead or deceive students, pro-
spective students, or the public as to the
§ 116.18
character of the institution, its courses
of instruction, or its influence in obtain-
ing employment for students, is an unfair
trade practice.
§ 116.14 Deception in issuance of di-
plomas, degrees, etc.
For any member of the industry to
issue any certificate or diploma, or to
confer any degree, which misrepresents
the course of study or instruction cov-
ered or completed, or the accomplish-
ments or standing of the student receiv-
ing such certificate, diploma, or degree,
with the tendency or capacity to mislead
or deceive students, prospective students,
or the public, is an unfair trade practice.
§ 116.15 Falsely representing courses of
study.
Falsely representing the character or
scope of any course of instruction or
service offered, with the tendency or ca-
pacity to mislead or deceive students,
prospective students, or the public, is an
unfair trade practice.
§ 116.16 Milisrepresentation as to fac-
ulty, advisory board, instruction
materials, ete.
The making of false, untrue, or de-
ceptive statements or representations,
through advertising or otherwise, that
a certain individual or individuals are
bona fide members of the faculty of a
school or are members of its advisory
board or authors of its instruction mate-
rial, or the making of misleading state-
ments or representations as to the value
of any former connection with the United
States Government as an aid to securing
employment, with the tendency or ca-
pacity to mislead or deceive students,
prospective students, or the public, is an
unfair trade practice.
§ 116.17 Misrepresentation as to per-
sonal insiructiou.
The false representation, through ad-
vertising or otherwise, that students are
given personal instruction by the head
of the institution or a department head
thereof, with the tendency or capacity to
mislead or deceive students, prospective
students, or the public, is an unfair trade
practice.
§ 116.18 Deceptive ‘Help Wanted” ad-
vertising.
The use of “Help Wanted” or other
employment columns in newspapers or
531
§ 116.19
other publications to get in touch with
prospective students in such manner as
to mislead or deceive such prospective
students into the belief that a job is
offered is an unfair trade practice.
§ 116.19 Blind advertising.
The use of “blind” advertisement or
sales literature to attract prospective
students when such advertisements or
literature fail to set forth that courses of
instruction or other educationai services
are being offered, in such manner as to
mislead or deceive students, prospective
students, or the public, is an unfair trade
practice.
§ 116.20 Deceptive language in general.
The use of misleading or deceptive lan-
guage in any form, with the tendency
or capacity to mislead or deceive stu-
dents, prospective students, or the public
is an unfair trade practice.
§ 116.21 Misue of word “guarantee.”
The use of the word “guarantee” or
other word or words of similar import
in connection with “money-back” agree-
ments, in such manner as to mislead or
deceive students, prospective students,
or the public, is an unfair trade practice.
§ 116.22 Simulation of legal documents.
In the collection of tuition fees, the
use of papers simulating or counter-
feiting court documents in such manner
as to mislead or deceive students is an
unfair trade practice.
§ 116.23 Photographic
tions.
misrepresenta-
The use of a photograph, cut, engrav-
ing or illustration in catalogs, sales lit-
erature, or otherwise, in such manner
as to convey a false impression as to the
size, importance, or location of the offices
occupied by a private home study school,
or as to such school’s equipment, with
the tendency or capacity to mislead or
deceive students, prospective students, or
the public, is an unfair trade practice.
§ 116.24 Misuse of national emblems,
pictures of United States Capitol, and
similar devices, connoting Govern-
ment endersement.
The use of pictures or illustrations of
Uncle Sam, the National Capitol, or any
pictures, illustrations, or devices or simi-
lar character, or the use of the name or
title of any present or former Govern-
ment official, activity, branch, depart-
Title 16—-Commercial Practices
ment, or establishment of the Govern-
ment, in such manner as to mislead or
deceive students, prospective students, or
the public into the erroneous belief that
the institution or its instructors have
official relationship or connection with
the United States Government, or into
the erroneous belief that the training or
services offered has the approval or en-
dorsement of the United States Govern-
ment or any branch thereof, is an unfair
trade practice.
§ 116.25 Misuse of words
profit.”
Falsely representing, directly or in-
directly, through advertising or other-
wise, that a school is operated ‘‘not for
profit”, with the tendency or capacity
to mislead or deceive students, prospec-
tive students, or the public, is an unfair
trade practice.
§ 116.26 Unqualified students.
Wiillfully inducing the enrollment or
retention of a student for any course of
instruction or training for a job or posi-
tion for which the student is manifestly
unfit by reason of educational or perma-
nent physical disqualification, or other
material disqualification, is an unfair
trade practice.
Grovp IL
§116.101 “Money-back” agreements.
“Money-back” agreements, so-called,
or other similar contracts between school
and student, should state plainly the con-
ditions under which tuition or other mon-
eys will be refunded, and such agree-
ments or contracts should contain no
conditions intended to deceive, hamper,
or harass the student and prevent a re-
fund to him of tuition to which he may
be entitled under the terms of the con-
tract.
“not for
§ 116.102 Selection of sales representa-
tives.
It is the judgment of the industry that
the sales representatives of all schools
be selected primarily on a basis of ability
and integrity and that each representa-
tive be given an adequate preliminary
training and be bonded by an approved
bonding company or by adequate per-
sonal sureties conditioned upon the
faithful performance of his financial
duties before being authorized to secure
student enroiiment.
532
Chapter [—Federal Trade
§ 116.103 Dissemination of adequate in-
formation to prospective students.
It is the judgment of the industry that
all schools should, at or prior to the time
of enrollment for any course of study or
service, provide each student enrolled
therein with literature, by means of cata-
log, correspondence or other writing,
clearly setting forth the nature, scope,
number and character of lesson assign-
ments and the terms upon which such
course of study or service is sold.
§ 116.104 Precautions in avoidance of
deceptive statements by sales repre-
sentatives.
It is the judgment of the industry that
the members thereof should exercise
careful supervision over their sales
representatives so as to guard against
any misrepresentations by such repre-
sentatives regarding advantages or op-
portunities or other matters pertinent to
enroliing students or prospective stu-
dents, whether or not the same be set
forth in the contract between school and
student.
COMMITTEE OF TRADE PRACTICES
§ 116.201
The provisions of § 16.1 of this sub-
chapter shall be applicable to an industry
committee established under this part.
{21 F.R. 1174, Feb. 21, 1956]
Industry committee.
PART 117—-SCHOOL SUPPLY AND
EQUIPMENT INDUSTRY
Sec.
117.0 Definitions; the industry and its
products.
Group TI
117.1 Misrepresentation and misbranding
in general.
117.2 Misrepresentation as to character of
business.
117.3 Misrepresenting products as con-
forming to standard or specifica-
tion.
117.4 Deceptive pricing.
117.5 Guarantees, warranties, etc.
117.6 Substitution of products.
117.7 Deceptive use of trade or corporate
names, trade-marks, etc.
117.8 Passing of through imitation or sim-
ulation of trade-marks, trade
names, etc.
117.9 Deceptive invoicing.
117.10 Defamation of competitors or inter-
fering with or disparaging their
products. . .
117.11 Inducing breach of contract.
Commission § 117.1
Sec.
117.12 Enticing away employees of com-
petitors.
Commercial bribery.
Procurement of competitors’ confi-
dential information.
Tie-in sales; coercing purchase of
one product as a prerequisite to the
purchase of other products.
Unfair threats of infringement suits.
Prohibited sales below cost.
Exclusive deals.
Prohibited forms of trade restraints
(unlawful price fixing, etc.).
Consignment distribution.
Use of the word ‘‘free.”
Prohibited discrimination.
Aiding or abetting use of unfair trade
practices.
AutTHORITY: The provisions of this Part 117
issued under secs. 6, 5, 38 Stat. 721, 719;
15 U.S.C. 46, 45, unless otherwise noted.
Source: The provisions of this Part 117
appear at 22 F.R. 2935, Apr. 26, 1957, unless
otherwise noted.
§ 117.0 Definitions; the industry and its
products.
(a) Products of this industry consist of
equipment and supplies for schools, col-
leges, universities, and other educational
institutions or organizations. Such prod-
ucts include, but are not limited to, pen-
cils, paper, crayons, chalk, chalkboards,
book covers, desks, chairs, addressing and
duplicating machines, flags and banners,
maps, laboratory and vocational equip-
ment and supplies, building maintenance
and sanitary equipment and supplies,
and outdoor and indoor playground
equipment. Text books are not included.
(b) Members of the industry are per-
sons, firms, corporations, and organiza-
tions engaged in the manufacture, sale,
or distribution of such equipment and
supplies.
117.13
117.14
117.15
117.16
117.17
117.18
117.19
117.20
117.21
117.22
117.23
Group I
§ 117.1 Misrepresentation and mis-
branding in general.
It is an unfair trade practlce to make
or publish, or cause to be made or pub-
lished, by way of advertising, labeling or
otherwise, any statement or representa-
tion which, directly or by implication,
has the capaclty and tendency or effect
of misleading or deceiving purchasers or
prospective purchasers concerning the
grade, quality, quantity, weight, use, size,
material, ingredients, finish, character,
origin, nature, design, condition, per-
formance, durability, resistance to water
or weather, manufacture, distribution,
533