Brick And Structural Clay Tile And Allied Products Industry
16 CFR Part 27 · Trade practice rules · in the Code of Federal Regulations 1959-1977 (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 These rules and guides are historical: most were rescinded or replaced, so do not assume any is in force.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, 1977 CFR · Earliest edition: 1959 CFR
Text (1977 edition, OCR)
3 26.15 § 26.15 Prohibited forms of trade re- straints (unlawful price fixing, etc.) It is an unfair trade practice, either directly or indirectly, to engage in any planned common course of action, or to enter into or take part in any under- standing, agreement combination or con- spiracy, with one or more industry members, or with any other person or persons, to fix or maintain the price of any goods or otherwise unlawfully to re- strain trade; or to use any form of threat, intimidation, 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 te become a party to any such understanding, agree- ment, combination, or conspiracy. PART 27—BRICK AND STRUCTURAL CLAY TILE AND ALLIED PRODUCTS INDUSTRY Sec. 27.0 The industry and its products defined. Group I 27.1 Prohibited discrimination. 27.2 Misrepresentation and deception (general). 27.3 Misrepresentation as to character of business. 27.4 Deceptive representations as to prod- ucts conforming to a standard or specification. The inhibitions of this section are sub- ject to Public Law 542, approved July 14, 1952, 66 Stat. 632 (the McGuire Act) which provides that with respect to a commodity which bears, or the label or container of which bears, the trade-mark, brand, or name of the producer or distributor of such com- modity and which is in free and open com- petition with commodities of the same general class produced or distributed by others, a seller of such a commodity may enter into a contract or agreement with a buyer thereof which establishes a minimum or stipulated price at which such commod- ity may be resold by such buyer when such contract or agreement is lawful as applied to intrastate transactions under the laws of the State. Territory or territorial jurisdic- tion in which the resale is to be made or to which the commodity is to be transported for such resale, and when such contract or agreement is not between manufacturers, or between wholesalers, or between brokers, or between factors, or between retailers, or be- tween persons, firms, or corporations in com- petition with each other. Title 16—Commercial Practices Sec. 27.5 Deception as to composition. 27.6 Guarantees, warranties, etc. 27.7 Substitution of products. 27.8 Deceptive use of trade or corporate names, trade-marks, etc. 27.9 Imitation or simulation of trade- marks, trade names, etc. 27.10 False invoicing. 27.11 Defamation of competitors or false disparagement of their products. 27.12 Inducing breach of contract. 27.13 Enticing away employees of competi- tors. 27.14 Commercial bribery. 27.15 Procurement of competitors’ confi- dential information. 27.16 Tie-in sales; coercing purchase of one product as a prerequisite to the purchase of other products. 27.17 Arrangements to exclude sales of com- petitors’ products. 27.18 Prohibited forms of trade restraints (unlawful price fixing, etc.). 27.19 Unlawful interference with competi- tors’ purchases or sales. 27.20 Consignment distribution. AUTHORITY: The provisions of this Part 27 issued under secs. 6, 5, 38 Stat. 721, 719; 15 U.S.C. 46, 45, unless otherwlse noted. Source: The provisions of this Part 27 ap- pear at 21 F.R. 3830, June 5, 1956, unless otherwise noted. § 27.0 The industry and its products defined. (a) Products of the industry respect- ing which these rules are promulgated consist of any kind or type of building units or materials which are, or are rep- resented directly or indirectly as being, brick or structural tile. (b) Members of the industry are per- sons, firms, corporations, and organiza- tions engaged in the manufacture, sale, offering for sale, or distribution of any such products. Group I § 27.1 Prohibited discrimination." (a) Prohibited discriminatory prices, or rebates, refunds, discounts, credits, 1As here used, the term “structural tile” does not include the veneer types of tile used for floor or wall surfacing. 3 As used in this section, the word “com- merce” means “trade or commerce among the several States and with foreign nations, or between the District of Columbia or any Territory of the United States and any State, Territory, or foreign nation, or between any insular possessions or other places under the jurisdiction of the United States, or between any such possession or place and any State or Territory of the United States or the Dis- 310 Chapter I—Federal Trade Commission etc., which effect unlawful price discrimi- nation. It is an unfair trade practice for any member of the industry engaged in commerce, in the course of such com- merce, to grant or ailow, secretly or openly, directly or indirectly, any rebate, refund, discount, credit, or other form of price differential, where such rebate, re- fund, discount, credit, or other form of price differential, effects a discrimina- tion in price between different purchas- ers of goods of like grade and quality, where either or any of the purchases in- volved therein are in commerce, and where the effect thereof may be substan- tially to lessen competition or tend to create a monopoly in any line of com- merce, or to injure, destroy, or prevent competition with any person who either grants or knowingly receives the benefit of such discrimination, or with customers of either of them: Provided, however, (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, and are not purchased by schools, coileges, unfversities, public libraries, churches, hospitals, or charitable insti- tutions not operated for profit, as sup- plies for their own use. (2) That nothing contained in this paragraph shail prevent differentials which make only due allowance for dif- ferences 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 contained in this section shall prevent persons engaged in selling goods, wares, or merchandise in commerce from selecting their own cus- tomers in bona fide transactions and not in restraint of trade. (4) That nothing contained in this paragraph shail prevent price changes from time to time where made in re- sponse to changing conditions affecting the market for or the marketability of the goods concerned, such as but not limited to obsolescence of seasonal goods, distress sales under court process, or sales in good faith in discontinuance of business in the goods concerned. trict of Columbia or any foreign nation, or within the District of Columbia or any Ter- ritory or any insular possession or other place under the jurisdiction of the United States.” 90-058-—77——21 § 27.1 (5) That nothing contained in this section shall prevent the meeting in good faith of an equally low price of a com- petitor, or the services or facilities fur- nished by a competitor. (See paragraphs (c) and (d) of this section.) (b) Prohibited brokerage and commis- Sions. It is an unfair trade practice for any member 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, brokerage, or other compensation, or any allowance or discount in lieu 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 inter- mediary therein where such inter- mediary ts acting in fact for or in behalf, or ts subject to the direct or indirect con- trol, of any party to such transaction other than the person by whom such counpensation is so granted or paid. (ce) 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 advertising or promotional allowances or any other thing of value to or for the benefit of a customer of such member in the course of such commerce as compensation or in consideration for any services or facili- ties furnished by or through such cus- tomer in connection with the processing, handling, sale, or offering for sale of any products or commodities manufac- tured, sold, or offered for sale by such member, unless such payment or con- sideration is available on proportionally equal terms to all other customers com- peting in the distribution of such prod- ucts or commodities. (d) Prohibited discriminatory services or facilities, It is an unfair trade prac- tice for any member of the industry en- gaged in 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 fur- nishing, or by contributing to the furnishing of, any services or facilities connected with the processing, handling, sale, or offering for sale of such commod- ity so purchased upon terms not ac- corded to ail competing purchasers on proportionally equal terms. (e) Inducing or receiving an illegal discrimination in price. It is an unfair 311 $ 27.2 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 foregoing provisions of this section. (f) Purchases by U.S. Government; applicability of Robinson-Patman Anti- discrimination Act to same. In an opin- ion submitted to the Secretary of War under date of December 28, 1936, the US. Attorney General advised that the Robinson - Patman Antidiscrimination Act “is not applicabie to Government contracts for supplies.” (38 Opinions, Attorney General 539.) $27.2 Misrepresentation and deception (general). It is an unfair trade practice to make or publish, or cause to be made or published, by way of advertising, label- ing, stamping, or otherwise, any state- ment or representation which, directly or indirectly, or by reason of conceal- ment of material fact, has the capac- ity and tendency or effect of misleading or deceiving purchasers or prospective purchasers concerning the grade, qual- ity, quantity, use, size, material, finish, character, nature, strength, thickness, composition, durability, design, origin, preparation, manufacture, or distribu- tion of any industry product, or in any other material respect. § 27.3 Misrepresentation as to character of business. It is an unfair trade practice for any member of the industry to represent, di- rectly or indirectly, through the use of any word or term in his corporate or trade name, in his advertising, or other- wise, that he is a producer or manufac- turer of, wholesaler or jobber of, contractor or dealer in, industry prod- ucts, or that he owns or controls a factory making such products, when such is not the fact, or in any other man- ner to misrepresent the character, ex- tent, volume, or type of his business. (See aiso note to § 27.8.) § 27.4 Deceptive representations as to products conforming to a standard or specification. In the sale, offering for sale, or distri- bution of industry products, it ls an un- fair trade practice: (a) To falsely represent or imply that any of such products conform to the re- quirements of any standard or specifica- Title 16—Commercial Practices tion, whether established or recognized by a department or unit of a city or State government, or of the Federal Govern- ment, by trade practice, or otherwise. (b) To represent or imply that any of such products conform to the require- ments of any standard or specification without clearly disclosing the identity of the standard or specification to which reference is made. Such disclosure shall be by reference to the standard or speci- fication on all labels, invoices, sales lit- erature, and other advertising containing such representation or implication. (c) For any member of the industry to claim or imply that any product con- forms to any standard or specification which is inapplicable or which has been rescinded, revised, superseded, or amend- ed, and thereby mislead or deceive pur- chasers or prospectlve purchasers. § 27.5 Deception as to composition. (a) It ls an unfair trade practice to sell, offer for sale, or distribute any product of this industry under any desig- nation or representation which has the capacity and tendency or effect of deceiv- ing purchasers or prospective purchasers as to the composition of said product. (b) Under this section no products of the industry shall be designated as “brick,” “tile,” or “structural tile,” unless ; (1) The composition thereof is prt- marily of clay or shale or mixtures there- of; and (2) The ingredients thereof have been fused together as a result of the appli- cation of heat: Provided, however, That such designa- tions may be used for products not meet- ing the requirements in this section when so qualified as to denote the basic com- position thereof (as, for example, “con- crete brick,” “coral brick,” “plaster brick,” “sand-lime brick,” “concrete structural tile,” etc.), or when, in im- mediate conjunction with the designa- tions, disclosure is made of the fact that the products are not ceramic products. (See also note to § 27.8.) § 27.6 Guarantees, warranties, etc. (a) It 1s an unfair trade practice to use any guarantee respecting industry prod- ucts, whether in respect to quality, con- struction, serviceability, method of man- ufacture, or in any other respect, which does not make reasonable disclosure of the terms, conditions, and limitations of such guarantee, or which contains state- 312 Chapter I—Federal Trade Commission ments, representations, or assertions which have the capacity and tendency or effect of misleading or deceiving in any material respect, or which are of such form, text, or character as to represent or imply that the guarantee is broader than is in fact true. (b) It is an unfair trade practice for the guarantor to fail to observe scrupu- lously his obligation under the guarantee by him used or caused to be used. (ec) This section shall be applicable also to warranties or any writing pur- porting to be a guarantee or warranty. (d) It is also an unfair trade practice to represent any industry product as being “guaranteed” unless the nature and extent of the undertaking, and the identity of the guarantor, are conjunc- tively disclosed. § 27.7 Substitution of products. It is an unfair trade practice for a member of the industry to make an un- authorized substitution of products, where such a substitution has the capac- ity and tendency or effect of misleading or deceiving the purchaser, by: (a) Shipping or delivering industry products which do not cenform to samples submitted, to specifications upen which the sale is consummated, or to representations made prior to securing the order, without advising the purchaser of the substitution and obtaining his consent thereto prior to making ship- ment or delivery; or (b) Falsely representing the reason for making a substitution. § 27.8 Deceptive use of trade or corpo- rate names, trade-marks, ete. The use of any trade name, corporate name, trade-mark, or other trade desig- nation, which has the capacity and tend- ency or effect of misleading or deceiving the purchasing or consuming public as to the name, nature, or origin of any prod- uct of the industry, or of any material used therein, or which is false or mis- leading in any other material respect, is an unfair trade practice. Nors: Nothing in this section is to be con- strued as prohibiting: (a) The use of the word “brick” as 6 part of the name of a corporation or business concern which manufactures or distributes brick of any type or composition, or (b) The use of the word “tile” or the words “structural title’ as a part of the name of a corporation or business concern which manufactures or distributes structural tile of any type or composition; § 97,12 Provided, however, That descriptions or references to any non-ceramic industry products contained in advertising, sales pro- motional Hterature or invoices of said cor- porations or concerns are in accord with the requirements of § 27.5. § 27.9 Imitation or simulation of trade- marks, trade names, etc. The imitation or simulation of the trade-marks, trade names, brands, or labels of competitors, or of the exclu- sively owned designs of competitors which have not been directly or by op- eration of law dedicated to the public, with the capacity and tendency or effect of misleading or deceiving purchasers or prospective purchasers, is an unfair trade practice. § 27.10 False invoicing. Withholding froin or inserting in in- voices or sales tickets any statements or information by reason of which omission or insertion a false record is made, wholly or in part, of the transactions repre- sented on the face of such invoices or sales tickets, with the capacity and tend- ency or effect of thereby misleading or deceiving purchases, prospective pur- chasers, or the purchasing public, is an unfair trade practice. § 27.11 Defamation of competitors or false disparagement of their prod- ucts. 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, or in any other respect, is an unfair trade practice. § 27.12 Inducing breach of contract. (a) Knowingly inducing or attempting to induce the breach of existing lawful contracts between competitors and their customers or their suppliers, or inter~ fering with or obstructing the perform- ance of any such contractual duties or services, under any circumstances having the capacity and tendency or effect or substantially injuring or lessening com- petition, is an unfair trade practice. (b) Nothing in this section is intended to imply that it ls improper for an indus- try member to solicit the business of a customer of a competing industry mem- “818 § 27.13 ber; nor is the section to be construed as in anywise authorizing any agreement or understanding by two or more industry members not to solicit business from the customers of either of them, or from cus- tomers of any other industry member. § 27.13 Enticing away employees of competitors. Knowingly enticing away employees or sales representatives of competitors under any circumstance having the ca- pacity and tendency or effect of substantially injuring or iessening com- petition is an unfair trade practice: Provided, That nothing in this section shall be construed as prohibiting em- ployees from seeking more favorable employment, or as prohibiting employers from hiring or offering employment to employees of competitors in good faith and not for the purpose of injuring, de- stroying, or preventing competition. § 27.14 Commercial bibery. 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’ cus- tomers or prospective customers, without the knowledge of their employers or principals, as an inducement to influence their employers or principals to purchase or contract to purchase products manu- factured or sold by such industry mem- ber or the maker of such gift or offer, or to influence such employers or principals to refrain from dealing in the products of competitors or from dealing or con- tracting to deai with competitors. § 27.15 Procurement of competitors’ confidential information. It is an unfair trade practice for any member of the industry to obtain infor- mation concerning the business of a com- petitor by bribery of an employee or agent of such competitor, 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 so as substan- tlally to injure competition or unreason- ably restrain trade. Title 16—Commercial Practices § 27.16 Tie-in sales; coercing purchase of one product as a prerequisite to the purchase of other products. The practice of coercing the purchase of one or more products of the industry as a prerequisite to the purchase of one or more other products, where the effect may be substantially to lessen competi- tion or tend to create a monopoly or un- reasonably to restrain trade, is an unfair trade practice. § 27.17 Arrangements to exclude sales of cempetiters’ products. It is an unfair trade practice for any member of the industry to sell or con- tract for the sale of any industry prod- ucts for use or resale, or to fix a price charged therefor, or discount from, or rebate upon, such price, on the condition, agreement, or understanding that the purchaser thereof shali not use or deal in new or used products of a competitor or competitors of such industry member, where the effect of such sale or contract for sale, or such condition, agreement, or understanding, may be to substantiaily lessen competition or tend to create a monopoly in any line of commerce. § 27.18 Prohibited forms of trade re- straints (unlawful price fixing, etc.).* It is an unfair trade practice for any member of the industry, either directly or indirectly, to engage in any planned com- mon course of action, or to enter into or take part in any understanding, agree- ment, combination, or conspiracy, with one or more members of the industry, 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, intimida- tion, or coercion to induce any member of the industry or other person or per- sons to engage in any such planned com- mon course of action, or to become a party to any such understanding, agree- ment, combination, or conspiracy. § 27.19 Unlawful interference with competitors’ purchases or sales. It is an unfair trade practice for any industry member, by means of any mo- *The inhibitions of this section are sub- ject to Public Law 642, approved July 14, 1952, 66 Stat. 632 (the McGuire Act). 314 Chapter I—Federal Trade Commission nopolistic practice or through combina- tion, conspiracy, coercion, boycott, threats, or any other unlawful means, directly or indirectly, to interfere with a competitor’s right to purchase his raw materials and suppHes from whomsoever he chooses, or to sell his product to whomsoever he chooses. § 27.20 Consignment distribution. (a) It is an unfair trade practice for any member of the industry to employ the practice of shipping industry prod- ucts on consignment without the express request or prior consent of the pur- chasers. (b) It is an unfair trade practice for any member of the industry to employ the practice of shipping industry prod- ucts on consignment or pretended con- signinent for the purpose and with the effect of artificially clogging or closing trade outlets and unduly restricting competitors’ use of said trade outlets in geting their products to purchasers through regular channels of distribution, thereby injuring, destroying, or prevent- ing competition or tending to create @ monopoly or unreasonably to restrain trade. (c) Nothing in this section shall be construed to authorize any understand- ing or agreement, combination or con- spiracy, or planned common course of action by and between industry mem- bers, mutually to conform or restrict their practice of shipping goods on con- signment with the intent or effect of lessening competition. PART 28—BLUEPRINT AND DIAZO- TYPE COATERS INDUSTRY Sec. 28.0 The industry defined. Group I 28.1 Deception (general). 28.2 False and misleading price quotations, ete. 238.8 Deceptive invoicing. 28.4 Substitution of products. 28.5 Prohibited sales below cost. 28.6 Commercial bribery. 28.7 Defamation of competitors or false disparagement of their products. 28.8 Procurement of competitors’ confi- dential information. 28.9 Enticing away employees of com- petitors, § 28.9 Sec, 28.10 Prohibited forms of trade restraints (unlawful price fixing, etc.). 28.11 Exclusive deals. 28.12 Prohibited discrimination. AvutrHorITy: The provisions of this Part 28 issued under secs. 6, 5, 38 Stat. 721, 719; 15 U.S.C. 46, 45, unless otherwise noted. Sovrce: The provisions of this Part 28 ap- pear at 21 F.R. 4010, June 12, 1956, unless otherwise noted. § 28.0 The industry defined. The industry to which these trade practice rules have application consists of persons, firms, corporations, and or- ganizations engaged in the coating and sale of blueprint and/or diazotype light- sensitive paper, cloth, film, or other material, used for reproducing engineer- ing and architectural drawings, designs, formulae, and office or business com- munications. Group I § 28.1- Deception (general). It is an unfair trade practice to seil, offer for sale, or distribute any industry product, or promote the sale or distribu- tion thereof, under any representation or by any method or under any circum- stance or condition which has the capac- ity and tendency or effect of misieading or deceiving purchasers or prospective purchasers: (a) With respect to the construction coinposition, design, strength, or dura- bility of any industry product; or (b) With respect to @ process or tech- nique used in the preparation, fabrica- tion, or coating of any industry product; or (c) With respect to the materials used in the preparation, fabrication, or coat- ing of any industry product; or (d) Which is false, misleading, or de- ceptive in any other materiai respect. Nore: Dlustrative of the type of misrep- resentation inhibited by this section is the practice of an industry member advertising or otherwise claiming that a paper contains a certain percentage of rag, or is of a certain basis weight, when such is not the fact. § 28.2 False and misleading price quo- tations, etc. The publishing or circulating to pur- chasers or prospective purchasers by any member of the industry of faise or mis- 315