Public Seating Industry
16 CFR Part 20 · Trade practice rules · in the Code of Federal Regulations 1938-1976 (15 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 These rules and guides are historical: most were rescinded or replaced, so do not assume any is in force.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, 1976 CFR · Earliest edition: 1938 CFR
Text (1976 edition, OCR)
Chapter |—Federal Trade Commission or take part in any understanding, agreement, combination, or conspiracy, with one or more members of the indus- try, or with any other person or persons, to fix or maintain the price of any goods or otherwise unlawfully to restrain trade; or to use any form of threat, in- timidation, or coercion to induce any member of the industry or other person or persons to engage in any such planned common course of action, or to become a party to any such understanding, agree- ment, combination, or conspiracy. § 19.14 Enticing away employees of competitors. Knowingly enticing away employees or sales representatives of competitors un- der any circumstances having the capac- ity and tendency or effect substantially injuring or lessening present or potential competition is an unfair trade practice: Provided, That nothing in this section shall be construed as prohibiting em- ployees from seeking more favorable em- ployment, or as prohibiting employers from hiring or offering employment to employees of competitors in good faith and not for the purpose of injuring, destroying, or preventing competition. § 19.15 Misrepresentmg products as conforming to standard. Representing, through advertising, personal solicitation, or otherwise, that any product of the industry conforms to a standard recognized in or applicable to the industry when such is not the fact, is an unfair trade practice. § 19.16 Pusb money. It is an unfair trade practice for any industry member to pay or contract to pay anything of value to a salesperson employed by a customer of the industry member, as compensation for, or as an inducement to obtain, special or greater effort or service on the part of the sales- person in promoting the resale of prod- ucts supplied by the industry member to the customer: (a) When the agreement or under- standing under which the payment or payments are made or are to be inade is without the knowledge and consent of the salesperson’s employer; or (b) When the terms and conditions of the agreement or understanding are such that any benefit to the salesperson or customer is dependent on lottery or chance; or § 19.201 (c) When any provision of the agree- ment or understanding requires or con- templates practices or a course of con- duct unduly and intentionally hampering sales of products of competitors of an industry member; or (d) When, because of the terms and conditions of the understanding or agreement, including its duration, or the attendant circumstances, the effect may be to substantially lessen competition or tend to create a monopoly; or (e) When similar payments are not accorded to salespersons of competing customers on proportionally equal terms in compliance with sections 2 (d) and (e) of the Clayton Act. Nore: Payments made by an industry member to & salesperson of a customer under any agreement or understanding that all or any part of such payments is to be trans- ferred by the salesperson to the customer, or is to result in @ corresponding decrease in the salesperson's salary, are not to be considered within the purview of this section, but are to be considered as subject to the require- ments and provisions of section 2(8) of the Clayton Act. § 19.17 Aiding or abetting use of unfair trade practices. It is an unfair trade practice for any person, firm, or corporation to aid, abet, coerce, or induce another, directly or in- directly, to use or promote the use of any unfair trade practice specified in the rules in this part. COMMITTEE ON TRADE PRACTICES § 19.201 Industry committee. The provisions of § 16.1 of this sub- chapter shall be applicable to an indus- try committee established under this part. [21 P.R. 3218, May 16, 1956) PART 20—PUBLIC SEATING INDUSTRY Grovur I Sec. 20.1 Misrepresentation of industry prod- ucts. 20.2 False invoicing. 20.3 Use of false or deceptive selling methods, etc. 20.4 Misuse of terms “‘close-outs,” “obso- lete items,” ‘“‘discontinued lines,” etc. 20.5 Defamation of competitors or dis- paragement of their products. 20.6 Commercial bribery. 20.7 Unfair threats of infringement suits. o71 § 20.1 Sec. 20.8 Procurement of competitors’ confi- dential information by unfair means, and wrongful use thereof. 20.9 Inducing breach of contract. 20.10 Enticing away employees of com- petitors. 2.11 Substitution of products. 20.13. Discrimination. 20.13 Aiding or abetting use of unfair trade practices. Group If 20.101 Maintenance of accurate records. 20.102 Blind bids. COMMITTEE ON TRADE PRACTICES 20.201 Industry Committee. AutTHoriry: The provisions of this Part 20 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 20 appear at 4 F.R. 4131, Oct. 4, 1989, unless otherwise noted. Group I § 20.1 Misrepresentation of industry products. It is an unfair trade practice to make or publish, or cause to be made or pub- lished, directly or indirectly, any false, misleading or deceptive statement or representation (whether in the form of advertisement, label, brand, guarantee, warranty, testimonial, endorsement, de- piction, ilustration, or other form of representation, however disseminated or published) : (a) Concerning the grade, quality, quantity, substance, character, nature, origin, size, or preparation of any prod- ucts of the Public Seating Industry; or (b) Concerning the manufacture, sale or distribution of any such products; or (c) Concerning any other matter in relation to such products. § 20.2 False invoicing. Withholding from or inserting in in- voices or sales tickets any statements or information by reason of which omis- sion or insertion a false record is made, wholly or in part, of the transactions represented on the face of such invoices or sales tickets, with the effect of there- by misleadmg or deceiving the purchas- ing or consuming public, is an unfair trade practice. § 20.3 Use of false or deceptive selling inethods, etc. The use of false or deceptive selling methods which have the tendency and Title 16—Commercial Practices capacity or effect or misleading or de- ceiving the purchasing or consuming public is an unfair trade practice. § 20.4 Misuse of terms “obsolete items,” lines,”’ etc. It is an unfair trade practice to ad- vertise, describe or otherwise represent regular lines of merchandise as “close- outs,” “obsolete items,” ‘discontinued lines,” or by words or representations of similar import, when such are not true in fact; or to so advertise, describe or otherwise represent merchandise where the capacity and tendency or effect thereof is to lead the purchasing or con- sumimg public to believe such merchan- dise is being offered for sale and sold at greatly reduced prices or at so-called “bargain” prices, when such is not the fact. § 20.5 Defamation of competitors or disparagement of their products. 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 dis- paragement of the grade, quality, or manufacture of the products of competi- tors or of their business methods, selling prices, values, credit terms, policies or services, is an unfair trade practice. § 20.6 Commercial bribery. It is an unfair trade practice for a member of the industry directly or in- directly to give, or offer to give, or permit or cause to be given, money or anything of value to agents, employees or repre- sentatives of customers or prospective customers, or to agents, employees or representatives of competitors’ custom- ers or prospective customers, without the knowledge of their employers or princi- pals, as an inducement to influence their employers or principals to purchase or contract to purchase public seating prod- ucts manufactured or sold by such indus- try member or the maker or such gift or offer, or to influence such employers or principals to refrain from dealing in the products of competitors or from dealing or contracting to deal with competitors. § 20.7 Unfair threats of infringement suits. The circulation of threats of suit for infringement of patents or trademarks among customers or prospective cus- “close-outs,”” “discontinued 272 Chapter |[—Federal Trade Commission tomers of competitors, not made in good faith but for the purpose or with the effect of harassing or intimidating such customers or prospective customers, or of unduly hampering, injuring or preju- dicing competitors in their businesses, is an unfair trade practice. § 20.8 Procurement of competitors’ con- fidential information by unfair means, and wrongful use thereof. It is an unfair trade practice for any member of the industry to obtain infor- mation concerning the business of a coin- petitor, by bribery of an employee or agent of such coinpetitor, by false or mis- leading statements or representations, by the impersonation of one in authority, or by any other unfair means, and to use the information so obtained in such a manner as to injure said competitor in his business or to suppress competition or unreasonably restrain trade. § 20.9 Inducing breach of contract. Inducing or attempting to induce the breach of existing lawful contracts be- tween competitors and their customers or their suppliers by any false or decep- tive means whatsoever, or interfering with or obstructing the performance or any such contractual duties or services by any such means, with the purpose and effect of unduly hampering, injuring or prejudicing competitors in their busi- nesses, is an unfair trade practice. § 20.10 Enticing away employees of competitors. Willfully enticing away the employees of competitors, with the purpose and effect of unduly hampering, injuring or prejudicing competitors in their busi- nesses, is an unfair trade practice. § 20.11 Substitution of products. The practice of shipping or delivering products which do not conform to sam- ples submitted, to specifications upon which the sale is consummated, or to rep- Tesentations made prior to securing the order, without the consent of the pur- chasers to such substitutions and with the tendency, capacity or effect of mis- leading or deceiving purchasers, pro- spective purchasers or the consuming public is an unfair trade practice. § 20.12 Discrimination. (a) Prohibited discriminatory prices, or rebates, refunds, discounts, credits, etc., which effect unlawful price discrim- ination. It is an unfair trade practice § 20.12 for any member of the industry engaged in commerce, in the course of such com- merce, to grant or allow, secretly or openly, directly or indirectly, any rebate, refund, discount, credit, or other form of price differential,’ where such rebate, refund, discount, credit, or other form of price differential effects a discrimi- nation in price between different pur- chasers of goods of like grade and quality, where either or any of the pur- chases involved therein are in commerce, and where the effect thereof may be sub- stantially to lessen competition or tend to create a monopoly in any line of com- inerce, or to injure, destroy, or prevent coinpetition with any person who either grants or knowingly receives the benefit of such discrimination or with custom- ers of either of them: Provided, how- ever: (1) That the goods involved in any such transaction are sold for use, con- sumption, or resale within any place un- der the jurisdiction of the United States; (2) That nothing herein contained shall prevent differentials which make only due allowance for differences in the cost of manufacture, sale, or delivery resulting from the differing methods or | quantities in which such commodities are to such purchasers sold or delivered; (3) That nothing herein contained shall prevent persons engaged in selling goods, wares, or merchandise in com- merce from selecting their own custom- ers in bona fide transactions and not in restraint of trade; _ (4) That nothing herein contained shall prevent price changes froin time to time where made in response to changing conditions affecting either (i) the mar- ket for the goods concerned, or (ii) the marketability of the goods, such as, but not Himited to, actual or imminent de- terioration of perishable goods, obsoles- cence of seasonal goods, distress sales under court process, or sales in good faith in discontinuance of business in the goods concerned. (b) Prohibited brokerage and commis- sions. It is an unfair trade practice for any inember of the industry engaged in commerce, in the course of such com- merce, to pay or grant, or to receive or accept, anything of value as a commis- sion, bokerage, or other compensation, or any allowance or discount in lieu 1 Paragraph (a) of § 20.12 shall not be con- strued as embracing practices prohibited by paragraphs (b) (c) and (d) of this section. 273 § 20.13 thereof, except for services rendered in connection with the sale or purchase of goods, wares, or merchandise, either to the other party to such transaction or to an agent, representative, or other in- termediary therein where such interme- diary is acting in fact for or in behalf, or is subject to the direct or indirect control, of any party to such transac- tion other than the person by whom such compensation is so granted or paid. (c) Prohibited advertising or promo- tional allowances, etc. It is an unfair trade practice for any member of the industry engaged in commerce to pay or contract for the payment of adver- tising or promotional allowances or any other thing of value to or for the bene- fit of a customer of such member in the course of such commerce as compensa- tion or in consideration for any services or facilities furnished by or through such customer in connection with the processing, handling, sale, or offering for sale of any products or commodities manufactured, soid, or offered for sale by such member, unless such payment or consideration is available on propor- tionally equal terms to all other cus- tomers competing in the distribution of such products or commodities. (d) Prohibited discriminatory services or facilities. It is an unfair trade prac- tice for any member of the industry en- gaged m commerce to discriminate in favor of one purchaser against another purchaser or purchasers of a commodity bought for resale, with or without proc- essing, by contracting to furnish or by furnishing, or by contributing to the furnishing of, any services or facilities connected with the processing, handiing, sale, or offering for sale of such com- modity so purchased upon terms not ac- corded to all purchasers on proportion- ally equal terms. (e) Inducing or receiving an illegal discrimination in price. It is an unfair trade practice for any member of the industry engaged in commerce, in the course of such commerce, knowingly to induce or receive a discrimination in price which is prohibited by the fore- going provisions of this section. (f) Purchases by schools, colleges, uni- versities, public libraries, churches, hos- pitals, and charitable institutions not operating for profit. The foregoing pro- visions of this section relate to practices within the purview of the Robinson-Pat- man Antidiscrimination Act, which act and the application thereunder of this Title 16—Commercial Practices section are subject to the limitations ex- pressed in the amendment to such Rob- inson-Patman Antidiscrimination Act, which amendment was approved May 26, 1938, and reads as follows: Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That noth- ing in the Act approved June 19, 1936 (Pub- lic, Numbered 692, Seventy-fourth Congress, second session), known as the Robinson- Patman Antidiscrimination Act, shall apply to purchases of their supplies for their own use by schools, colleges, universities, public libraries, churches, hospitals, and charitable institutions not operated for profit. (Sec. 2, 38 Stat. 730, as amended, secs. 2, 3, 4, 49 Stat. 1527, 1528, ch. 283, 52 Stat. 446; 15 U.S.C. 18, 18a, 13b, 13c, 21a) § 20.13 Aiding or abetting use of un- fair trade practices. It is an unfair trade practice for any person, firm or corporation to aid, abet, coerce or induce another, directly or in- directly, to use or promote the use of any unfair trade practice specified in this part. Group II Maintenance of accurate rec- § 20.101 ords. It is the judgment of the industry that each member should independently keep proper and accurate records for determining his costs. § 20.102 Blind bids. In cases of competitive bidding, the practice of receiving or making so-called “blind bids,” which discount the lowest competitive bld regardless of the amount, tends to destroy competitive bidding, and is condemned by the industry. COMMITTEE ON TRADE PRACTICES § 20.201 Industry committee. The provisions of § 16.1 of this sub- chapter shall be applicable to an indus- try committee established under this part. [21 FR. 1174, Feb. 21, 1956] PART 21—CORSET, BRASSIERE, AND ALLIED PRODUCTS INDUSTRY Sec. 21.0 Definitions. Group I 21.1 Prohibited discrimination. 21.2 Misrepresentation in general. 21.3 Misrepresentation as to welght-reduc- ing properties. 274.