Eugene D. Petry

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IN THE MATI'ER OF EUGENE D. PETRY, DOING BUSINESS AS ·warner STUDIOS COMPLAINT, FINDINGS, AND ORDER IN REGARD TO THill ALLEGED VIOLATION OF SEC. IS OF AN ACT OF CONGRESS APPROVED SEPT. 26, 1914 Docket 21i9. Complaint, Mar. 21, 1996-Decililon, June 20, 1996 Where an individual engaged in operation of a photograph and portrait studio In the city of Washington, D. C., and In many other cities In various States and In soliciting in said city sale of photographs and portraits of various types and kinds to persons sitting as subjects therefor, through house to house canvassers or salesmen- (a) Represented through coupons sold prospective purchasers at prices ranging from 50¢ to $1.50, and through those presented without cost, in case of its so-called "Courtesy Owner," and variously entitling holders thereof to pho· togrtLphs of various types and kinds at said individual's studio upon payment there, in some cases, of an additional amount varying from 50¢ to $1.00, but, in case of most, without further payment, that said coupons or "certificates" represented and entitled holder to a special favor or price, or "Special Advertising Otter" for the "latest In portraiture," and that regu· lar value represented by such coupons or certificates, for which holder was thus charged amounts ranging from 50¢ to $2.50, was from $3.50 to $7.50. as case might be, and represented in soliciting sale of said photographs or portraits as aforesaid through said salesmen that regular value thereof was far in excess of the usual prevalllng prices for similar products in said city and ottered same to such purchasers at pretended special prices which were considerably less than their represented regular value, upon the supposed consideration that the prospective purchaser would "advertise" bib business to friends and neighbors in the purchaser's particular commu· nlty;

Facts being such regular values or usual prices were fictitious and misleading, many purchasers of such special otter coupons found upon presentation thereof at his studio that he was reluctant and unwilling to honor same according to terms printed thereon, such supposed special otters were only a part of a continuous scheme of solicitation in the regular, usual course and conduct of his said business, and said photographs or portraits of the supposed regular value of from $3.50 to $7.fi0 each were exactly the same kind, type and quality as regularly and ordinarily sold by popular priced studios operated and conducted by competitors in such District at prices ranging from $1.00 to $2.00;

With ettect of misleading and deceiving purchasers into the belief that they were obtaining such photographs at prices far below their usual semng prices and below their true or regular value or worth; and (b) Set forth upon said certificates or coupons the trade name "Warner Stu· dios" employed by blm and such statements and representations as "Oper· ating Exclusively with Movie Lighting Equipment" and "New Motion Pic· ture Fllm Used," notwithstanding fact he did not use such film nor operate exclusively with such equipment In making his said photographs or WARNER STUDIOS 651 050 Complaint portraits; with effect of misleading many purchasers into the belief that he was in some manner connected with the Warner Brothers Motion Picture Studios of Hollywood; and (c) Designated and described photographs sold by it as "Goldtone Colored 1n Oil," notwithstanding fact it was not a Goldtone but a less costly sepia print which he did not actually color in oil but bathed by rubbing with oil-soaked cotton;

With capacity and tendency to mislead and deceive purchasing public and induce purchasers to buy Its said photographic products in and on account of the belief that said representations and statements were true and thus unfairly divert trade from his competitors located in said District of Columbia who in nowise make the same or similar false and misleading representations and statements, and employ such methods and practices, but truthfully represent to the public the true or real values and prices for their said products, and in connection therewith accurately and truthfully represent the kind or quality thereof offered for such prices, and do not through use of simulation of corporate or trade name in connection with other statements used, create the inference in the minds of the members of such public that they are deallng with some outstanding and well known Hollywood motion picture studio :

Held, That such acts and practices, under the conditions and circumstances set forth, were to the prejudice of the public and competitors and constituted unfair methods of competition.

Mr. DelVitt T. Puckett for the Commission. Mr. Daniel 0. Eberly and Mr. Ohester A. Bennett, of Washington, D. C., for respondent.

Col\IPLAINT Pursuant to the provisions of an Act of Congress approved Sept~mber 26, 1914, entitled "An Act to create a Federal Trade Commis- Sion, to define its powers and duties, and for other purposes," the Federal Trade Commission, having reason to believe that Eugene D. Petry, an individual, doing business under the trade name of Warner Studios, hereinafter referred to as respondent, has been, and now is, using unfair methods of competition in commerce, as "commerce" is defined in said act, and it appearing to said Commission that a pro- ~eeding by it in respect thereof would be in the public interest, hereby Issues its complaint, stating its charges in that respect as follows: . PARAGRAPH 1. Respondent, Eugene D. Petry, is an individu~l tr~d­ Ing under the firm name and style of ·warner Studios, with his prmcipal office and place of business, located at 1317 F St., in the citYJ of Washington in the District of Columbia; and also maintains offices, and doe~ business, as an individual, under s~id trade name of Warner Studios in many other cities located in various States of the United States.

Complaint 22F.T.C.

PAR. 2. Respondent is now, and has been, for more than 1 year last past, engaged in the business of conducting and operating a photograph and portrait studio in the city of Washington, in the District of Columbia, at and from which he solicits the sale of, and sells, photographs and portraits of various types and kinds to members of the purchasing public loca~d and residing in said District, and who sit as subjects for such photographs or portaits in respondent's said studio. In the course and conduct of his said business, as aforesaid, respondent is in competition with other individuals, .firms, partnerships, and corporations likewise engaged in conducting and operating photograph and portrait studios in said District of Columbia, and who likewise are engaged in the sale of photographs and portraits of those persons who reside in said District, and who sit as subjects in their studios.

PAR. 3. In the course and conduct of his said business, the respondent, in offering for sale, in soliciting the sale of, and in selling said photographs or portraits, employs salesmen or canvassers to canvass from house to house in the said District of Columbia for the purpose of contacting prospective purchasers of such photographs or portraits, and inducing them to have such photographs or portraits taken of themselves, and having them take the necessary sittings therefor at respondent's studio in said District; and, as an inducement to such prospective purchasers to purchase such photographs or portraits, and to take such necessary sittings therefor, the respondent has caused, authorized, instructed, suffered, and permitted his said salesmen or canvassers in soliciting the sale of such photographs or portraits to make false and misleading statements and representations in the distribution and sale by them, for varying amounts ranging from 50 cents to $1.50, of purported coupons or "certificates," which, according to the terms thereof, entitle the holders and purchasers of same to certain alleged favored or special prices for photographs or portraits of various types and kinds to be taken of them at respondent's said studio. Almost all of these coupons or "certificates" deal with, and have stated therein in bold type, an alleged "Special Advertising Offer," or other special offer, for what is claimed by respondent, in much smaller type contained therein, to be the "latest in portraiture"; and each of which has, when used by the purchaser thereof, according to the ~rms of the particular offer contained in each of said various coupons or "certificates," a "regular value" varying from $3.50 to $7.50, as will hereinafter appear and be more particularly and fully set forth. Some of these purported coupons WARNER STUDIOS 653 650 Complaint or "certificates" contain the respondent's direction and authorization to the prospective purchaser to pay his "representative 50¢ for this certificate"; and, some, the respondent's direction and authorization to the prospective purchaser to "pay representative $1.00 for this certificate"; while, in other instances, no sum is required, and in these latter instances the coupon or "certificate" is represented as a "courtesy offer" featured in bold, large type. In the case of one particular type of coupon or "certificate," so sold and distributed by respondent's salesmen or canvassers, having nn alleged and purported "regular value" of $7.50, there are contained therein the statements "for $2.50 only," and respondent's direction and authorization to "pay representative $1.50," calling for the "balance at studio $1.00," which balance, presumably, is required to be paid at the time of the sitting, or when otherwise used by the purchaser thereof. In the case of most of these coupons or "certificates," according to the terms printed thereon, "no balance at studio" is required from the purchaser; while, in others there is contained the statement that the purchaser is required to pay in addition "50¢ balance at the studio," which balance, presumably, is required to be Paid at the time of the sitting, or when otherwise used by the purchaser thereof. Except for some of these said instances, where additional payment of a "balance" is required, as hereinabove enumerated and described, the particular amount paid to respondent's canvasser or "representative" for each said particular type or kind of coupon or "certificate" by the purchaser thereof, constitutes, or is supposed to constitute, the total cost for the particular type of photograph or Portrait offered thereby by the respondent in accordance with the terms printed in each of said coupons or "certificates." PAR. 4. Some of these coupons, so sold, contain other statements and :epresentations, such as, "Operating Exclusively 'With Movie Light- Jng Equipment" and "New Motion Picture Film Used"; and, displayed in prominent bold type on each of these coupons or "certificates," there appears respondent's trade name "WARNER STUDIOS''; and, each of these coupons contains substantially, and with very little difference, the same language in connection 'with featuring the various offers and inducements of special prices made therein to prospective purchasers of respondent's photographs and Portraits, which, exclusive of such language are, in each instance substantially as follows:

Complaint 22F.T.C.

(a) This Offer Can Not Be Purchased at Studio WARNER STUDIOS • • • • • • Regular VALUE$3.50 Selection of Proofs Latest in New Motion Pic· Unmounted Portraiture ture Film Used SPECIAL ADVERTISING OFFER ONE 8 x 10 PORTRAIT COLORED IN OIL Pay Representative 50¢ FOR 50¢ ONLY No balance for this Certificate at Studio • • • Good until ---------------------- Representative _______________________ _ • • • • • • • • • (b) This Otrer Can Not Be Purchased at Studio WARNER STUDIOS • • • • • • Regular VALUE$5.00 Selection of Proofs Latest in New Motion Picture Portraiture Film Used SPECIAL ADVERTISING OFFER ONE 8 x 10 GOLDTONE COLORED IN OIL Pay Representative $1.00 FOR $1.00 ONLY No Balance for this Cert11lcate at Studio

Good until---------------------- Representative--------------------- • • • • •• • • • WARNER STUDIOS 655 650 Complaint (c) SPECIAL PORTRAIT OFFER • • • • • • WARNER STUDIOS • • • • • • Introducing to Washington Photography's Latest Creation ONE 11 x 14 TAPESTRY OIL PAINTING Pay Representative 50¢ FOR $1.00 ONLY Pay 60¢ for this Certificate Balance at Time of Sitting • • • Operating Exclusively with Movie Lighting Equipment • • • • • • ------------------ Salesman Good Until _________________ _ (d) This Otfer Can Not Be Purchased At Studio WARNER STUDIOS • • • • • • Regular VALUE $5.00 Selection of 4 to 6 proofs Latest in New Motion Pic· Portraiture ture Film Used SPECIAL CHRISTMAS OFFER ONE 8 x 10 GOLDTONE COLORED IN OIL Pay Representative $1.00 FOR $1.00 ONLY No Balance at for this Certificate Studio • • • Good Until---------------------- Representative ________ ---------------- • • • • • • • • • Complaint 22F.T.C.

(e) This Ofrer Can Not Be Purchased .At Studio WARNER STUDIOS • • • • • • Regular VALUE $5.00 Selection of 4 Proofs Latest In Portraiture New Motion Picture Film Used SPECIAL CHRISTMAS OFFER ONE 8 x 10 GOLDTONE COLORED IN OIL Pay Representative 50¢ FOR $1.00 ONLY 50¢ Balance at for this Certificate Studio • • • Good until ----------------------- Representative ----------------------- • • • • • • • • • (f) This Offer Can Not Be Purchased .At Studio W.ARNER STUDIOS • • • • • • Regular VALUE $5.00 Selection of Proofs Latest in Portraiture New Motion Picture Film Used SPECIAL .ADVERTISING OFFER ONE 8 x 10 FRENCll VIGNETTE Pay Representative 50¢ FOR 50¢ ONLY No Balance at for this Certificate Studio • • • Good Until ----------------------- Representative ----------------------- • • • • • • • • • WARNER STUDIOS 657 650 Complaint (g) COURTESY OFFER • • • Selection of Proofs ONE 8 x 10 PORTRAIT of Yourself or any Member of your Family FREE This offer cannot be purchased at Studio • • • WARNER STUDIOS • • • • • • • • • This Portrait has been Paid for by ------------------- ------------------ (h) This Otrer r.an Not Be Purchased At Studio WARNER STUDIOS • • • • • • Regular VALUE $5.00 Selection of Proofe Latest in Portraiture New Motion Picture Film Used SPECIAL ADVERTISING OFFER ONE 8 x 10 GOLDTONE COLORED IN OIL Pay Representative rm; FOR $1.00 ONLY 00¢ Balance at tor this Certltlcate Studio • • • Good Until ----------------------- Representative--------------------- • • • • • • • • • Complaint 22F.T.C.

(1) 'L'his Offer obtained through Representative only. Regular Price without this certificate $7.50.

WARNER STUDIOS • • • • • • VALUE $7.50 Operating Exclusively with Movie Lighting Equipment SPECIAL ADVERTISING OFFER One Ivora Miniature in 011, Complete with Frame (SELECTION OF PROOFS) Pay Representative $1.50 !<'or $2.50 ONLY Balance at Studio $1.00 Additional Portraits at Special prices to Holders of Certlftcates Only. (Special representative) Good Until------------------- • • • • • • • • • (j) This 01rer Can Not lle Purchased At Studio WARNER STUDIOS • • • • • • Regular VALUE $Ci'.OO Selection of Proofs Latest in New Motion Unmounted Portraiture Picture Film Used SPECIAL PORTRAIT OFFER ONE 8 x 10 VELOUR OIL PAINTING Pay Representative 50¢ FOR 50¢ ONLY No Balance at Studio for this Certificate • • • Good Until-------------------- Representative--------------------------- • • • • • • • • • WARNER STUDIOS 659 650 Complaint PAR. 5. In the course and conduct of his business, as aforesaid, and in soliciting the sale of and selling of said photographs or portraits, as heretofore described and set forth, respondent, through his salesmen or canvassers, appointed by him as agents in his behalf, in order to induce prospective customers to purchase said vari"ous types of photographs or portraits, and to take the necessary sittings therefor represents, the "regular value" thereof to be far in excess of the prices at which such photographs or portraits actually, ordinarily and usually sell in the city of Washington, District of Columbia; and, the respondent, together with, and, in connection with such representations of "regular value," then offers the said prospective purchasers, in each of the instances above enumerated and set forth, pretended special prices which are considerably much less than the represented "regular value" for such photographs or portraits; and, which pretended "Special Advertising Offers" or, other special offers, are made upon the claimed consideration that such prospective purchasers will "advertise" the business of the respondent to their friends and neighbors residing in their respective communities; when, in truth and in fact, such special prices represented by respondent to be the usual prices or "regular value" of his photographs or portraits are fictitious and misleading, and are calculated to, and actually do mislead and deceive purchasers and prospective purchasers as to the real value of said photographs or portraits and their usual selling prices, and do mislead and deceive them into the belief that they are obtaining said photographs or portraits at prices far below their usual selling prices and below their true and "regular value" or worth, when they buy at the pretended special prices offered by respondent, as hereinabove set forth; and, further, when respondent's said special prices made and offered by him to purchasers and prospective purchasers in his said coupons or "certificates" in the manner and method heretofore described and set forth, are in fact misleading and a misrepresentation in that : (a) 1\Iany of said purchasers who purchased, from respondent's "representatives" or canvassers, the so-called "Special Advertising Offer" and other special offer coupons or "certificates," as hereinabove enumerated and set forth, have, upon presentation of same, at the respondent's studio, either found the respondent reluctant and unwilling to honor same according to the terms printed thereon; or Were either high-pressured or unfairly coerced by a most intensive sales effort into purchasing additional photographs or portraits at higher prices; or were informed and told that the photographs or Portraits called for on the face of the "certificate" could not be furnished by respondent except upon the payment of additional 5889l)m-38-VOL 22-44 Complaint 22F.T.C.

money; or were in other instances flatly refused the particular photograph or portrait provided and called for by the terms of said coupon or "certificate."

(b) Many such purchasers have inferred from the use of respondent's trade name, ""\VARNER STUDIOS" printed on some of said coupons or "certificates," when taken together with other statements printed thereon, such as, "Operating Exclusively With Movie Lighting Equipment," and "New Motion Picture Film Used," that the respondent is in some manner connected with Warner Brothers Motion Picture Studios of Hollywood, Calif., when such is actually not the fact.

(c) Prospective purchasers and purchasers were misled and deceived by respondent's claim that he was making "Special Advertising Offers" and other special offers, when actually such offers were only a part of a continuous scheme of solicitation in the regular, usual course and conduct of his said business. (d) Prospective purchasers and purchasers were misled and deceived by respondent's claim of offering for sale and selling photographs or portraits, represented by him to be of from $3.50 to $7.50 "regular value," when in fact, exactly the same kind, type, and quality of photographs or portraits are regularly, usually and ordinarily sold by popular price studios operated and conducted by respondent's competitors in said District, at prices ranging from $1.00 to $2.00.

(e) The photograph which the respondent advertises and represents to be a "Goldtone Colored in Oil," is not in fact a Goldtone, but a sepia print which costs less tQ produce than the Goldtone, and which respondent uoes not actually color in oil but bathe~ by rubbing with oil-soaked cotton.

PAn. 6. In the course and conduct of his business, as aforesaid, respondent is in competition with corporations, partnerships, firms, and individuals likewise engaged in conducting and operating photograph and portrait studios located in the said District of Columbia, who in nowise make the same or similar false and misleading representations and statements as are made by the respondent, and who do not employ, use, or indulge in the methods and practices, hereinabove alleged and set forth in this complaint, but who truthfully represent to the purchasing public the true, honest, and real values or prices for their photographs or portraits, and who accurately and truthfully, in connection with such prices, do not misrepresent the type, kind, or quality of the photographs or portraits offered for sale by them for such prices; and, who do not, by the use of a false and misleadin~ corporate or trade name, or other statements used WARNER STUDIOS 661 650 Findings or employed in connection therewith, create the inference in the minds of members of the purchasing public that they are dealing with some outstanding and well lmown motion picture studio located in Hollywood, Calif.

PAR. 7. The aforesaid representations made by the respondent about and concerning his photographs or portraits, and the employment and use by him of the name "WARNEU STUDIOS" as hereinabove stated, have the capacity and tendency to deceive and mislead the purchasing public, and to induce purchasers to buy the said photographic products of the respondent in and on account of the belief that said representations and statements are true, and thus unfairly divert trade to respondent from his said competitors located in the said District of Columbia.

PAR, 8. The acts and things done by respondent, and the methods and practices employed, used and indulged in by him, as hereinabove alleged, described and set forth are all to the injury and prejudice of the public and to respondent's competitors, and constitute unfair methods of competition in interstate commerce within the intent and meaning of Section 5 of an Act of Congress approved September 26, 1914, entitled "An Act to create a Federal Trade Commission, to define its powers and duties, and for other purposes." REPORT, FINDINGS AS TO Tile FACTS, AND ORDER Pursuant to the provisions of an Act of Congress approved September 26, 1914, entitled "An Act to create a Federal Trade Commission, to define its powers and duties, and for other purposes," the Federal Trade Commission, on the 21st day of March 1936, issued and served its complaint in this proceeding upon the respondent, Eugene D. Petry, doing business under the trade name of Warner Studios, charging him with the use of unfair methods of competition in commerce in violation of the provisions of said act. After the issuance of said complaint and the filing of said respondent's answer thereto, a stipulation as to the facts was entered into between the respondent through his attorneys, Daniel C. Eberly, Esq., and Chester A. Bennett, Esq., and this Commission, subject to its approval, through its chief counsel, ,V. T. Kelley, Esq., in and by which stipulation it was agreed that the statement of facts contained therein might be taken as the facts in this proceedings and in lieu of testimony in support of the charges stated in the complaint or in opposition thereto; and in which stipulation it was provided that the Commission might proceed upon said statement of facts to make its report; its findings as to the facts (including inferences which it Findings 22F.T.C.

might draw from the said stipulated facts) and its conclusion based thereon and under its order disposing of the proceeding without the presentation of arguments or the filing of briefs; and the Commission having duly considered the same and being fully advised in the premises, finds that this proceeding is in the interest of the public and makes this its findings as to the facts and its conclusion drawn therefrom:

FINDINGS AS TO TIIE FACTS PARAGRAPH 1. The respondent, Eugene D. Petry, is an individual trading under the firm name and style of Warner Studios, and is engaged in the operation of a photograph and portrait studio, with his principal office and place of business located at 1317 F St., in the city of '\Vashington, in the District of Columbia. He also does business under said trade name in many other cities located iii various States of the United States.

PAR. 2. In the course and conduct of his business, respondent operates a photograph and portrait studio in the city of 'Vashington, in the District of Columbia, at and from which he solicits the sale of, and sells, photographs and portraits of various types and kinds to persons who sit as subjects for such photographs or portraits. In said business, respondent is in competition with other individuals, firms, partnerships, and corporations likewise engaged in operating photograph and portrait studios in said District of Columbia, and in selling photographs and portraits to those persons who sit as subjects therefor.

PAR. 3. In the course and conduct of his said business, the respondent, in soliciting the sale of and in selling said photographs or portraits, employs salesmen to canvass from house to house in the said District of Columbia for the purpose of contacting prospective purchasers of such photographs or portraits, and inducing them to have such photographs or portraits taken of themselves, and having them take the necessary sittings therefor at respondent's studio in said District. As an inducement to such prospective purchasers to purchase such photographs or portraits, the respondent has caused, instructed, suffered, and permitted his said salesmen to make false and misleading statements and representations in the distribution and sale by them, for varying amounts ranging from 50 cents to $1.50 of purported coupons or "certificates," which, according to the terms thereof, entitle the holders and purchasers of same to certain alleged favored or special prices for photographs or portraits of various types and kinds to be taken of them at respondent's said studio. Almost all of these coupons or "certificates" deal with, and WARNER STUDIOS 663 650 Findings have stated therein in bold type, an alleged "Special Advertising Offer," or other special offer, for what is claimed by respondent, in much smaller type contained therein, to be the "latest in portraiture"; and each of which has, when used by the purchaser thereof, according to the terms of the particular offer contained in each of said various coupons or "certificates," a "regular value" varying from $3.50 to $7.50. Some of these purported coupons or "certificates" contain the respondent's direction and authorization to the prospective purchaser to pay his "representative 50¢ for this certificate"; and, some, the direction to "pay representative $1.00 for this certificate." In other instances no sum is required; and, in these latter instances the coupon or "certificate" is represented as a "Courtesy Offer" featured in bold large type.

In the case of one particular type of coupon or "certificate," so sold and distributed by respondent's salesmen, having an alleged and purported "regular value" of $7.50, there are contained therein the statements "for $2.50 only," and respondent's direction and authorization to "pay representative $1.50," calling for the "balance at studio $1.00," which balance is required to be paid at the time of the sitting, or when otherwise used by the purchaser thereof. In the case of most of these coupons or "certificates," according to the terms printed thereon, "no balance at studio" is required from the purchaser; while, in others there is contained the statement that the purchaser is required to pay in addition "50¢ balance at the studio," which balance is required to be paid at the time of the sitting, or when otherwise used by the purchaser thereof. Except for some of these said instances, where additional payment of a "balance" is required, as hereinabove described, the particular amount paid to respondent's canvasser or "representative" for each said particular type or kind of coupon or "certificate" by the purchaser thereof, constitutes, or is supposed to constitute, the total cost for the particular type of photograph or portrait offered thereby by the respondent in accordance with the terms printed in each of said coupons or "certificates."

PAR. 4. Some of these coupons, so sold, contain other statements ~nd representations such as "Operating Exclusively with Movie Light- Ing Equipment" and "New Motion Picture Film Used"; and, displayed in prominent bold type on each of these coupons or "certif- Icates," there appears respondent's trade name "WARNER STU- DIOS." In fact respondent does not use new motion picture film and does not operate exclusively with Movie Lighting Equipment in m~king his photographs and portraits. Each of these coupons contams substantially, and with very little difference, the same language Findings 22F.T.C.

in connection with featuring the various offers and inducements of special prices made therein to prospective purchasers of respondent's photographs and portraits.

PAR. 5. In the course and conduct of his business, as aforesaid, and in soliciting the sale of and selling of said photographs or portraits, as heretofore described and set forth, respondent, through his salesmen, in order to induce prospective customers to purchase said various types of photographs or portraits, and to take the necessary sittings therefor, represents the "regular value" thereof to be far in excess of the prices at which such photographs or portraits actually, ordinarily and usually sell in the city of 'Vashington, District of Columbia. The respondent, in connection with such representations of "regular value," then offers the said prospective purchasers, in each of the instances above set forth, pretended special prices which are considerably less than the represented "regular value" for such photographs or portraits; and, which pretended "Special Advertising Offers" or other special offers, are made upon the claimed consideration that such prospective purchasers will "advertise" the business of the respondent to their friends and neighbors residing in their respective communities. In truth and in fact, such prices represented by respondent to be the usual prices or "regular value" of his photographs or portraits are fictitious and misleading, and are calculated to and actually do mislead and deceive purchasers and prospective purchasers as to the real value of said photographs or portraits and their usual selling prices, and do mislead and deceive them into the belief that they are obtaining said photographs or portraits at prices far below their usual selling prices and below their true and "regular value" or worth, when they buy at the pretended special prices offered by respondent, as hereinabove set forth. Further, respondent's said special prices made and offered by him to purchasers and prospective purchasers ju his said coupons or "certificates" in the manner and method heretofore described and set forth are in fact misleading and a misrepresentation in that:

(a) Many of said purchasers who purchased from respondent's salesmen the so-called "Special Advertising Offer" and other special offer coupons or "certificates," as hereinabove set forth, have, upon presentation of same at the respondent's studio, found the respondent reluctant and unwilling to honor same according to the terms printed thereon. · (b) Many such purchasers have inferred from the use of respondent's trade name, "WARNER STUDIOS," printed on some of said coupons or "certificates," when taken together with other statements printed WARNER STUDIOS 665 650 Findings thereon, such as "Operating Exclusively With Movie Lighting Equipment" and "New Motion Picture Film Used," that the respondent is in some manner connected with ·warner Brothers Motion Picture Studios or Hollywood, Cali£.

(c) Prospective purchasers and purchasers were misled and deceived by respondent's claim that he was making "Special Advertising Offers" and other special offers, when actually such offers were only a part of a continuous scheme of solicitation in the regular, usual course and conduct of his said business.

(d) Prospective purchasers and purchasers were misled and deceived by respondent's claim of offering for sale and selling photographs or portraits represented by him to be or regular value of from $3.50 to $7.50 each, when in fact exactly the same kind, type, and quality of photographs or portraits are regularly, usually, and ordinarily sold by popular price studios operated and conducted by respondent's competitors in said District at prices ranging from $1.00 to $2.00. (e) The photograph which the respondent advertises and represents to be a "Goldtone Colored in Oil" is not in fact a Goldtone, but a sepia print which costs less to produce than the Goldtone, and which respondent does not actually color in oil but bathes by rubbing with oil-soaked cotton.

PAn. 6. In the course and conduct or his business, as aforesaid, respondent is in competition with corporations, partnerships, firms, and individuals likewise engaged in conducting and operating photograph and portrait studios located in the said District of Columbia, who in no wise make the same or similar false and misleading representations and statements as are made by the respondent. Said competitors do not employ, use, or indulge in the methods and practices hereinabove set forth, but truthfully represent to the purchasing public the true, honest, and real values or prices for their photographs or portraits, and accurately and truthfully in connection with such prices represent the type, kind, or quality of the photographs or portraits offered for sale by them for such prices. Said competitors do not by the use of simulating a corporate or trade name, when taken together with other statements used or employed in connection therewith, create the inference in the minds of members of the purchasing public that they are dealing with some outstanding and well-known motion picture studio located in Hollywood, Calif. PAR. 7. The aforesaid representations made by the respondent about and concerning his photographs or portraits, and the employment and use by him of the name "\VARNER STUDIOS" as hereinabove stated, have the capacity and tendency to deceive and mislead the purchasing public, and to induce purchasers to buy the said photo- Order 22F.T.C.

graphic products of the respondent in and on account of the belief that said representations and statements are true, and thus unfairly divert trade to respondent from his said competitors located in the said District of Columbia.

CONCLUSION The aforesaid acts and practices of respondent under the conditions and circumstances set forth in the foregoing findings are to the prejudice of the public and of respondent's competitors, and are unfair methods of competition in commerce, and constitute a violation of Section 5 of the Act of Congress approved September 26, 1914, entitled "An Act to create a Federal Trade Commission, to define its powers and duties, and for other purposes."

ORDER TO CEASE AND DESIST This proceeding having been heard by the Federal Trade Commission upon the complaint of the Commission and a stipulation entered into between the respondent herein, Eugene D. Petry, an individual doing business under the trade name of Warner Studios, by his counsel, Daniel C. Eberly and Chester A. Bennett, and counsel for this Commission, and the Commission having made its findings as to the facts and its conclusion that said respondent has violated the provisions of an Act of Congress approved September 26, 1914, entitled "An Act to create a Federal Trade Commission, to define its powers and duties, and for other purposes." Now, therefore, it is hereby ordered, That said respondent, Eugene D. Petry, an individual, doing business under the trade name of Warner Studios, his agents, representatives and employees, in the sale and offering for sale in interstate commerce, and in the District of Columbia, of photographs and portraits of various types and kinds to persons who sit as subjects therefor, forthwith cease and desist from:

(1) Representing, directly or by implication, that the various types of photographs and portraits made in his studio have actual and regular values, and customarily sell for sums, in excess of the prices actually charged for said photographs and portraits. {2) Representing, through advertising literature containing the descriptive language "Goldtone Colored in Oil" or language of similar import, or in any manner whatever, that sepia print photographs are Goldtones or are Goldtones Colored in Oil. (3) Representing in connection with his trade name, Warner Studios, through advertising literature containing the descriptive language "Operating Exclusively 'With Movie Lighting Equipment" WARNER STUDIOS 667 650 Order or "New Motion Picture Film Used" or language of similar import or in any manner whatever, directly or by implication, that his photographic and portrait studio is in any way connected with Warner Brothers Motion Picture Studios of Hollywood, Calif. It is further ordered, That said respondent shall within 60 days from the date of service upon him of this order file with the Commission a report in writing setting forth in detail the manner and form in which this order had been complied with. Syllabus 22F.T.C.