Gulf Coast Oil Company of Mississippi, Inc.

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IN THE MATTER OF GULF COAST OIL COMPANY OF MISSISSIPPI, INC., AND ANTHONY PACIERA COMPLAINT, ~'INDINGS, AND OitDER IN REGARD TO Tile ALLEGED VIOLATIO!'I 01!' SEC. ll OF AN ACT OF CONGRESS AI'PitOVED SEPT. 26, 1914 Docket 28u0. Oowplaint, June 30, 1!1311-Dcci.,ion, Mar. 3, 19J"' Where a corpomtion, long eugaged in sale and distribution of gasoline and motor oil~ in bulk to retail dealers for resale and to consumers for use in State!:! of Louisiana, 1\Ibsis.~ippl, null Alahama, had built up, as Gulf Refill· ing Company, a wide t·eputation and E-Xtensive good-will among users of its vroducts, and :said products were well and favornbly known to public generally, and sign, in form of metal disk colort•d orange and bearing the one wonl "Gulf" in large blacli: or dnrk !Jiue shaded letters, ami usually su;;pemled In (rout of stations selling its products nn<l on its equipment gem·rally, constituted spedul feature of its advertising, used to great ad· \'autage for many years, aud prospective cu,..1:omers had long bet•n urged, through Yat·ious mediums, to buy "At the Sign of The Orange Disk", and pl'intPd reproduction thereof was used to identify all its products and was palnt{'d upon its tauk~, trucks and otht-r equipment in letters of sun1e character aml color ns those on the disk itself, and where its said produds iududt-d brands de><ignatt•<l by it us "Gulf Supreme l\Iotor Oil" and "GnU~· pride Oil", ami said unmes had long been featured by it in all forms of its udvei'th;ing, at g1·ent expt•n:-;e, and were definitely assodated with and formed an important part of general puhlie's couception of it aud its prod· ucts, as similarly had been feutured and was assodated, etc., name of its "Gulf No-Nox Ethyl," nuder and by which name it designated "ethyl" gtlS comvosed of mixture of gasoline and tetruetbyl lead, In common with other competitors who nsetl word "ethyl" us part of their brand names under" whkh the-y offered their respective "ethyl," 7:::i octane, ot· bettet·, premium, and well and favorably known gnsolines to consumiug public; and 1:het·enftet' a corporate competitor eugag!'d in sale aud distribution of gasoline and motor oils to dealers purchasing in bulk for resale aml to eonsumet·s fur use, and In SlliJl)lying filling s·tations which it operated in Loull'iana, Mississippi, nn<l Alabama in snbstnutial competition with said first-named corporation and with otlwrs similnrly engaged, and the prt•sldt•nt of said corporate coll· petitur, In active charge of its afl'uirs antl controller and director of all its liOlldes and bu:-;iness operations, and originator of the various forJIIS of advertising and business methotls adopted !Jy such comrwtltor- (a) ~'eaturell in all of said eompetitot·'s display adverth;ing Rnd on signs at \'arious of its stations and on gasoline pumps, trucks, and other equipment, wortl "Gulf," either alone or in prlnt<'d letters F~ubstantially large-r tlutn tho~e of other word~'! In connection with which used, and Invariably in shaded letters of same type and color, substanHnlly, us those used by said first·naml'd eoi'poJ'atlon in its printing anti use of word "Gulf," and exten· siyely advertiHe!l Ril "Gulf Supr<'me Gasoline" one brand, and ln lt:i! nd· veJ·tising thereof on signs posted lu and about the vnrlous filling stations, GULF COAST OIL CO. OF :MISSISSIPPI, INC., ET AL. 761 760 Syllabus illuminated at night, frequently, featured word "Gulf," with letters tJI(>J'l•of twice as large ·as other two words, and word "Rupreme" in "quotation:>," and, at times, with its own corporate name of "Gulf Coast Oil Company of 1\Iississippi" In letters about one-third size of words "Supreme" and ''Gnsoline," and word "Gulf" in same type and coloring as those used hy said firstnamed corporation, nnd advertised said "Gulf Supreme Gasoline" through radio broadcast programs capable, in case of some, of being heard over entire United States, without mention, as a rule, of its own corporate name in course thereof, in which listeners were advised of location of stations at which its said products might be obtained, and designated and adverti;:ed extensively in newf:papers of interstate circulation and in other ways its so-ealled "Gulf Either Gasoline," name of which was featured on gasoline pumps located nt its ¥arious stations in aforesaid States, and made use of terms "Pride of the People' and "Gulf 'Pride' 1\lotor Oil" ln designation nnd advertisement of certain oils sold by it, notwithstanding fact neither Gulf Rf·fining Company nor Ethyl Gasoline Corporation had given their Jlennission to said competitor and its aforesaid 11resident to use tto>rm;; "Gulf," "Gulf Supreme Motor Oil," "Gulfpride Oil," "Gulf No-Nox Ethyl Gasoline" or "Either" ln designating the various gasoline and motor oil prodnL1s of said corporate competitor and its said president, manager and controller; With capacity and tendency, by reason of said acts and practices of said corporate competitor and its said president in Imitating and Rimulating products of said first-named corporation and of other distributors selling various types of "Ethyl'' gasoline, through such colorable imitations and simulations of aforesaid trade names and brand names for various gasollnes and motor oils sold by sald first-named corporation over a period of many years, and, ln aforesaid use of term "Either,:• of registered trade 11ame "Ethyl" of said Ethyl Gasoline Corporation and its various licensees, to confuse and mislead trade and public generally with respect to nature, quality, and origin of various products sold by such corporate competitor, and with result that, under ordinary conditions prevailing in usual course of business in sale of gasolines and motor oils, members of public might be induced, by reason of such simulation and imitation of trade names and trade marks, to buy said corporate competitor's gasoline, motor oil and other products as and for such products distributed and sold by said firstnamed corporation, lts agents and dealers, or as and for gasoline distributed by competitors of it and licensees of said Ethyl Gasoline Corporation; and (b) Revresented, in all of their advertising, radio broadcasts, uewspaper advertising, and otherwise, that said corporate competitor's "Gulf Either Gasoline" tested 70 octanes and was eqni'l'alent to high test premium gasoline and to "Ethyl" gasoline for which premium Is charged, facts being its said product, principal type of gasoline eventually sold by lt, was produced by adding small quantities of commercial either to ordinary gasoline, and Umt the small and insignificant amount of either added did not affect gasoline lm·olved to any noticeable extent and was not beneficial thereto and did not Increase value, potency or power thereof, make same any more heneficlal to automobile motors, or decrease tendency thereof to knock or detonate, and was not comparable in efficiency to gasoline to which tetraethyl lead has been added in such quantities as to raise octane rnting thereof to 75, but, on contrary, disclos<'d rntings ranging, at different times nnd tests, from GG to G8 or G9;

Complaint 24F.T.0· With tendency and capacity to mislead a substantial portion of purchasing public into errone<>us beliefs that said representations were true and that said "Gulf Either Gasoline" was comparable in value to and gave equal performance with various types of high test premium gasoline and ethyl gasoline, and with result, as a direct consequence of such mistaken and erroneous beliefs, induced by such acts and representations, that a number of the consuming public purchased a substantial volume of said "Gulf Either Gasoline" and trade was unfairly diverted to said corporate com· petitor and its aforesaid president and manager from competitors engaged In business of distributing and selling various types of high test premium and ethyl gasollnes, and who truthfully advertise their products, and from competitors engaged in distribution and sale of ordinary grades of gasoline who truthfully advertise, as to both quality and efficiency of performance, their respective products:

Helrl, That such acts and practices were to the prejudice of the public and competitors and constituted unfair methods of competition. Before Mr. John J. Keenan, trial examiner.

Mr. J. T. Welch for the Commission.

Titohe &: Titche, of New Orleans, La., for respondents. Complaint Pursuant to the provisions of an Act of Congress approved Sep· tember 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 Gulf Coast Oil Company of .Mississippi, Inc., a corporation, and Anthony Paciera, an individual, hereinafter designated as respondents, are now, and have been, using unfair methods of competition in commerce, as "com· merce" is defined in said act, and it appearing to said Commission that a proceeding by it in respect thereof would be in the public interest, hereby issues its complaint stating the charges in that respect us follows:

PARAGRAPH 1. Respondent, Gulf Coast Oil Company of Mississippit Inc., is a corporation organized, existing, and doing business under and by virtue of the laws of the State of Mississippi, with its prin· cipal office and place of business at 3331 St. Charles A venue, in the city of New Orleans, State of Louisiana. Respondent, Anthony Paciera, residing in the city of New Orleans, State of Louisiana, is the president of the respondent corporation and is actively in charge of said corporation and directs and controls all of its policies and operations. He is the originator of the various forms of advertising· and business methods which have been adopted and followed by the respondent corporation. Respondents are now, and have been since· on or about January 1, 1933, engaged in the business of selling and- GULF COAST OIL CO. OF MISSISSIPPI, INC., ET AL. 763 760 Complaint distributing gasoline, kerosene, motor oil, and similar products, m bulk to dealers purchasing for resale and to consumers for use. PAR. 2. Said respondents, being engaged in business as aforesaid, cause said gasoline, kerosene, and motor oil, when sold, to be transported from their office and principal place of business, or from their ~torage tanks located in the State of Louisiana, to purchasers thereof located at various points in other States of the United States. There is now, and has been at all times since the organization of respondent corporation, a constant current of trade and commerce in said gasoline, kerosene and motor oil, so distributed and sold by the respondents, between and among the various States of the United States. PAR. 3. In the course and conduct of their said business, respondents are now, and have been, in substantial competition with other corporations, firms, and individuals, likewise engaged in the business. of distributing and selling gasoline, kerosene and motor oil, in bulk to retail dealers for resale and to consumers for use, in commerce among and between the various States of the United States. PAR. 4. During all the time since the organization and incorporation of respondent corporation, and for many years prior thereto, the Gulf Refining Company, a corporation, maintaining its headquarters in Pittsburgh, State of Pennsylvania, and one of the competitors referred to in paragraph 3 hereof, has been engaged in the distribution and sale of gasoline, kerosene and motor oil, in bulk to retail dealers for resale and to consumers for use, particularly in the States of Louisiana, Mississippi, and Alabama. Since its organization, and for a period of more than thirty years, said Gulf Refining Company has built up a wide reputation and extensive good-will among the users of the products it sells and said products are well known to the public generally.

Early in its business career, the Gulf Refining Company adopted the colors yellow or orange as the colors of its plants and equipment generally, including its filling stations, some of which are owned by it, some of which are merely operated by it, and some of which merely sell its products. The uniform color of its stations and equipment became identified with the company and grew to be an important part of its plan of advertising. A special feature ?f its advertising that has been used to great advantage is a sign, In the form of a metal disk, colored orange and bearing the one \Vord "GULF" in black or dark blue shaded letters. The sign is IJ.sually suspended in front of the stations selling the products of the company and prospective customers have been urged through Various mediums, over a period of many years, to buy-"At the 764 FEDERAL TRADE COl\Il\IISSION DECISIONS Complaint 24 F. T. C. Sign of the Orange Disk." The printed reproduction of the disk is the trade-mark used to identify all the products of the company and is painted upon its tanks, trucks and other equipment. For a period of at least ten years, all of the storage tanks, gasoline pumps, tank trucks, and the woodwork of the filling stations owned by the company, have been painted a uniform shade of orange, the same as that of the disk above referred to and described. The petroleum products distributed and sold by the Gulf Refining Company are certain brands of gasoline and motor oil designated by it as "Gulf Supreme :Motor Oil," "Gulfpride Oil," "Gulf Ethyl Gasoline," and "No-Nox Ethyl Gasoline." These products, and the names by which they ure designated, have for a long time past, and are now, fpn,tured by the company in all forms of its advertising and are definitely associated with and form an important part of the general public's conception of the Gulf Refining Company and its products. The gasoline sold by the Gulf Refining Company under the names "Gulf Ethyl Gasoline" and "No-Nox Ethyl Gasoline" are composed of a mixture of ordinay·y gasoline and tetraethyl lead. Tetraethyl lead is added to the ordinary gasoline for the purpose of increasing . the efficiency of such ordinary gasoline as a fuel for modern type motors.

Gasoline to which tetraethyl lead has been added is also extensively ach·ertised and sold by other competitors of the respondents and the use of the word "Ethyl" in advertising and designating said gaso· line products, to which tetraethyl lead has been added, forms a dis· tinctive and valuable advertising asset. The superior quality of, and the superior performance given by, various types of "Ethyl" gaso· line, are well known to, and appr£'ci.ated by, the consuming public gf'nerally.

PAn. 5. Since about January 1, 1933, the respondents have caused the corpora-te respondent's stations, gasoline pumps, tank trucks, and other equipment, to be painted the same shade of orange color as that used by the Gulf Refining Company over a period of many years, ns herein set ont in paragraph 4. Respondents have also featured, and continue to feature, in all of the corporate respondent's display adv£'rtising, the word "GULF," either alone or in print substantially larger than that of the other words in connection with which it is llSPil. The word is writt£'n always in shaded letters of the same type and is printed in black or deep blue colors substantially the same as the let t£'rs nnd colors used, as herein set out, by said Gulf Refining' Company. Respondents have also made use of an oran(J'eb colored disk similar to that described as having been used by the Gulf Re· fining Company for many years, as part of corporate respondent's GULl' COAST OIL CO. OF MISSISSIPPI, INC., ET AL. 765 Complaint equipment, in their stations and luwe their trade-mark or insignia Painted on their pumps, tank trucks, and other equipment. This disk hears printed thereon in prominent letters the one word "GULF," Written in letters similar to those described with reference to the respondents' use of the same word on all of their other equipment. Hespondents have also made use of a disk, the upper half of which disk is colored the same shade of orange as that used by the Gulf Refining Company and the lower half colored black. Hespondents have also extensively advertise,cl one brand of the <:corporate respondent's gasoline products as "Gulf Supreme Gaso- ~ine." The name of this brand of gasoline is featured on signs posted lll and about the various filling stations and is painted on the gasoline Pumps and other equipment. The word "Supreme" on these signs is ;mphasized generally by enclosing the said word in quotation marks. fhe advertising of this brand of gasoline has been, and now is, conducted further by means of radio broadcasts from stations of suflicient power to carry the programs emanating therefrom to, into and through States of the United States other than the State of ~louisiana, so as to be received and heard by radio listeners residing In said other States. In all or in some of said broadcasts, the cor- Porate respondent's name is not mentioned. The broadcast is devoted ~ntirely to advertising the brand "Gulf Supreme Gasoline" and call- Ing attention to the location of gasoline stations at which it may be obtained. On signs prominently displayed at all of its stations, the corporate respondent has made use of the word "GULF" in letters much larger than all other letters on the sign and has used the words "Supreme Gasoline" in letters also larger than the remaining words 011 the sign. The respomlents' corporate name, Gulf Coast Oil Com- ~any of Mississippi, Inc., is displayed on said sign in letters con- EnderaLly smaller and less prominently displayed than the other Words herein referred to.

One of the principal types of gasoline sold by the corporate re- GSpondent is desicrnated~ and advertised extensively- as "Gulf Either gasoline." The gasoline pumps nt the corporate respondent's various :stations are painted the uniform orange color similar to that used by the Gulf Refining Company with the following words printed tltereon-"Gulf Either Gasoline." The "Gulf Either Gasoline" is [lrodured by adding a sm<tll quantity of either to a tank ear of approxilllately 8,000 gallons of ordinary gasoline. The amount of either lldded to said gasoline forms a small and insignificant part of the total volume of said gasoline when mixed and is not added in ~ufficient quantities to materially or substantially affect said gasoline 111 any beneficial manner.

H07;;Gm-311-vol. 2-l-~1 766 FEDERAL TRADE CO:\IMISSION DECISIONS Complaint 24 1<'. T. C. Respondents sell the gasoline designated by them as "Gulf Either Gasoline" as and for "Ethyl Gasoline," though said gasoline doe~ not perform with the same efficiency as gasoline to which tetraethyl lead has been added, as herein set out in paragraph 4, and is inferior in quality and in performance to "Gulf Ethyl Gasoline" and "Gulf No- Nox Ethyl Gasoline." The word "either'' when used in coujunetion with the words "Gulf" and "Gasoline" is a colorable imitation aJHl simulation of the tenn "Ethyl Gasoline" as rightfully used by mally of the competitors of the respondents.

The respondents have also made use of the terms "Pride of tho. People" and "Gulf 'Pride' motor oil" to designate types of motor oil sold by the corporate respondent. Signs and equipment, includillg oil containers, oil pumps, tank wagons, and other equipment, di:-play the tenn "Gulf Coast Oil Company-Pride of the People." Certain of the corporate respondent's tank wagons also display, printed in large letters thereon, the words "Gulf Pride Oil Company." Hespondents have also advertised certain of their motor oil products as "Gulf 'Pride' motor oil" in newspapers of generul circulation 1hrou~h­ out the various States of the United States. PAR. 6. The Gulf Uefining Company has spent large sums of money in painting all of its stations, pumps, tank trucks, aull other equipment, a uniform shade of orange and in extensively adn~rtisillg"r through newspapers, advertising booklets, radio broadcasts, and through other advertising media, its products such as "Gulf Supreu1e Motor Oil," "Gulf pride Oil," "Gulf Ethyl Gasoline," and "N o-No:'t Ethyl Gasoline." All of said terms and Lrand names, and said orange color scheme, are well and favorably known to the purchasing- public and are associated with the equipment and prorlucts of sai<l Gulf Uefining Company by said purchasing public and form assets of gn•at value to it. It has neither given its permission to the respondl'nts for the use of said color scheme in painting stations, pwnps, tank trucks~ or other equipment, nor has it given its consent to the use of t Jtr.te11ns "Gulf Supreme Motor Oil," "Gulfpride Oil," "Gulf Etl1yl Ga!-iOline," and "No-Nox Ethyl Gasoline" in designating the respondrntr::r various gasoline and motor oil products.

The usc by the respondents of said orange color scheme in paint i11p," their stations, pumps, tank trucks, and other equipment, and the use of the terms or brand names "Gulf," "Gulf Supreme Gasoline," ·'Gnlf Either Gasoline," "Pride of the People," "Gulf Coast Motor Oilt "Gulf Pride Oil Company," an<l "Gulf 'Pride' l\Iotor Oil," nrc such as to be colorable imitation and simulations of the color sch('JIIll adopted and used over a period of many years by the Gulf Refining GULF COAST OIL CO. OF MISSISSIPPI, INC., ET AL. 767 760 Complaint Company and of the products advertised and sold by the Gulf Refining Company over a like period.

PAR. 7. The acts and practices of the respondents, as hereinabove detailed, are such as to cause the corporate respondent's stations, pumps, tank trucks, and other equipment, to be imitations and simulations, in many particulars, of the stations, pumps, tank trucks, and other equipment, of the Gulf Refining Company and are of such a character as to cause the corporate respondent's products to imitate and simulate the products of the Gulf Refining Company and other competitors of the respondents selling various types of ethyl gasoline. The acts and practices of the respondents, and their imitation of the equipment and products of their competitors, have the capacity and tendency to confuse, deceive and mislead the trade and the public generally, under the ordinary conditions prevailing in the usual course of business, in the sale of gasoline, motor oil and similar products, and as a result thereof members of the trade and of the public may be and they are induced, by reason of such imitation and simulation, to buy the corporate respondent's gasoline, motor oil, and other products, in the belief that they are purchasing gasoline, motor oil, and other products, distributed and sold by the Gnlf Refining Company, its agents and vendees, and by other competitors of the respondents. As a result thereof, trade has been unfairly diverted from respondents' competitors and from dealers in the products of respondents' competitors, to the respondents and to the dealers in their products, all to the injury of the public and to the injury of competition, in commerce among and between the various States of the United States.

PAR. 8. Various types of gasoline perform with varying degrees of efficiency. The quality or grn.de of gasoline, with respect to eliminating knocking or "detonation,'' is susceptible of measurement and determination. This standard of measurement is expressed in terms 0.f octane value. The gasoline having the highest octane rating is con- Sidered by the trade, and the purchasing public, to be the best and commands a higher price or premium accordingly. Gasolines to which tetraethyl lead is added, and which are sold to the trade and public as ethyl gasoline, have an octane rating of not less than 75.

The respondents, in all of their advertising, radio broadcasts, news- Papers, and otherwise, represent that "Gulf Either Gasoline" tests 70 Dctnne and is equivalent to high-test premium gasoline and to ethyl gasoline for which a premium is charged. In truth and in fact, respondents' "Gnlf Either Gasoline" does not test 70 octane nihl is not 768 FEDERAL TTIADE COMl\IISSIO~ DECISIONS Findings 24 F. T. C. comparable to either ethyl gasoline or other high-test premium gaso· lines in performance and in eliminating or reducing knocking and detonation. The amount of either contained in respondent corporation's "Gulf Either Gasoline" is so small as to not materially improve either the starting ability or to appreciably affect the detonating tendency of the base gasoline to which the either is added. The either added to the respondents' gasoline does not materially contribute in any way so as to increase the efficiency of the performance of such gasoline when used.

PAR. 9. The false and misleading statements and representations made by the respondents, with reference to the quality of the corpo· rate respondent's "Gulf Either Gasoline" and its effectiveness in use, as hereinabove set out, in offering for sale and selling said "Gulf Either Gasoline," were, and are, calculated to, and had, and now have, the tendency and capacity to mislead and deceive a substantial por· tion of the purchasing public into the erroneous belief that said repre· sentations are tr·ne, and that. Slid "Gulf Either Gasoline'' is compara· ble in value to and gives equal performance with, various types of high-test gasolines and ethyl gasoline. Further, as a dirrct consequ<'nce of the mistaken and erroneous beliefs induced by the acts and repre· sentations of the respondents, a number of the consuming public have purchased a substantial volume o:f corporate respondent's "Gulf Ethet' Gasoline'' w.ith the result that trade has been unfairly diverted to the respondents from competitors engaged in the business of distrib· uting and selling various types of high-test gasolines and ethyl gaso· lines, and who truthfully advertise their products, and also from com· petitors engaged in the distribut,ion and sale of ordinary grades of gasoline, who truthfully advertise their respective products, both a9 to quality and efficiency of performance. As a result thereof, sub· stantial injury has been, and is now being, done by respondents in competition, in commerce among and between the Vltt·.ious states. PAR. 10. The above and foregoing acts, practices, and representa· tions of the respondents have been, and are, all to the prejudice of the public and respondents' competitors as aforesaid, and have been, and are, unfair methods of competition within the meaning and intent of Section 5 of an Act of Congress approved September 26, 1914, entitled "An Act to create a Federal Trade Commission, to d('fine it9 powers and duties, and for other purposes." UEronT, FINDINGs AS TO TIIE F A<'Ts, AND ORDF.R Pursuant to the provisions of an Act of Congress appron•d S('p· tember 26, 1914, entitled "An Act to create a Federal Trade Com· GULF COAST OIL CO. OF :IIISSI::lSIPPI, !XC., ET AL. 769 7GO Finuings 1llission, to define its powers and duties, and for other purposes," the Federal Trade Commission, on June 30, 1936, isstwd and !:>served its complaint in this proceeding upon the respondents, Gul:f Coast Oil Company of Mississippi, Inc., and Anthony Paciera, charging them_ With the use of unfair methods of competition in commerce in Violation of the provisions of said act. After the issuance of said com- Plaint, and the filing of respondent's answer thereto, testimony and ?ther evidence in support of the allegations of said complai11t were Introduced by J. T. ·welch, attorney for the Commission, before John J. Keenan, an examiner of the Commission theretofore duly designated by it, and in opposition to the allegations of the complaint by Bernard Titche, Jr., attorney for the respondents; and said testilllony and other evidence were duly recorded and filed in the office of the Commission. Thereafter, 011 February 17, 1937, the respondents filed a motion for permission to withdraw the answer theretofore filed and to substitute therefor an answer admitting all of the hlaterial allegations of the complaint to he true and waiving thfl, taking of further evidence and all other interwniug procedure. The Commission, by order entered herein, granted respondents' motion, and said substitute answer 'vas duly filed in the office of the Com- ?iission. Thereafter, the proceeding regularly came on for final hear- Ing before the Commission on said complaint, testimony and other evidence and said substitute answer and the Commission having duly considered the same, and being fully ad vised in the premises, finds ~hat this proceeding is in the interest of the public, and makes this lts findings as to the facts and its conclusion drawn therefrom: FlNJ)lNOS AS '1'0 THE FACTS PARAOHAI'II. 1. Gulf Coast Oil Company of l\Iississippi, is a cor- })Otation organized, existillg and doing business under the laws of the State of Mississippi. Its principal office and place of businpss is located at 3331 St. Charles A venue, in the city of New Orleans, La. Anthony Paciera is a resident of the city of New Orleans, La., and is ptesident of the corporate respondent. He is actively in charge of lt~ affairs tllld (lirrets and controls all of its policies and business oper- Uho~ts. He is the originator of the various forms of ad\·('rtising awl Lui'iiJtess uwthO<ls which have iJPen adoph•<l alld followed by the cor- ~)orate respondent. Since about January 1, 1V:33, the respolltlents have )(~Pn continuously engage<l in the business of selling and tlistriLuting gasoline and motor oils both to tlealers purchasing in bulk for resale anu to COllSlllllPl'S for use. The present cusl omers of the corporate l'e;;pondent who purchase these products for resale to the consuming FEDERAL TRADE COl\11\USSION DECISIONS 770 Pin dings 24 F. T. C. public are: Hospital Grocery, Gulfport, Miss.; Smith Brothers, Landon, Miss.; and Weider Service Station, Ocean Springs, Miss. The corporate respondent also operates a number of automobile service stations, commonly known us filling stations, in the city of New Orleans, La., and in ten or fifteen other cities or towns in that State. It also operates stations in the cities of lliloxi, St. Louis, Picayune, Poplanille, and HattiPl'bnrg in the State of Mississippi, and in the cities of Mobile and Birmingham in the State of Alabama. P.\R. 2. The corporate respondent causes said gasoline aucl motor oils, when sold, to be traJlsported from its office and principal place of business, or from its storage tanks located in the State of Louisiana, or from the refinery or other seller from whom it purchases said prod-1 ucts, to the purchasers thereof located at various points in States o£ the United States other than the State of Louisiana or other than the State of origin of said shipment. \Vhen dealers, purchasing for resale, order gasoline or motor oils from the corporate re,..pondent, said products are delivered to said purchasers from the corporate respondent's storage tanks located in the State of Louisia1m by trucks owned and operated by the corporate respondent. The total business, clone by the corporate respondent with dealers purchasing for resale. amounts to approximately $1,000 per month. Tha corporate respondent supplies the filling stations which it operates in the States of Louisiana, Mississippi, and Alabama wil h gasoline and motor oils, either through tank tru(·ks operated by it which withdmw ga~oliue from its slorage tanks in the State of Louisiana and deliver said prodnets to the respectiye stations, or through shipments of railroad tank car lots of said products to the rt>spective stations. \Vhenever a railroad tnnk car shipment is made to one of said stations, the shipment originates at the refinery in the State of Louisiana and is shipped direct from such seller's place of business to the respecti,,e stations, some of which are locah•d in 1\Ii:-:sissippi n11d otlwrs of which nre located in the State of Alabama.

PAn. 3. 'fhe respondents are engaged in substantial competition with other corporations, firms, and individuals likewise engaged in the busi1wss of distributing and selling gasoline and motor oils in bulk to retail dealers for resale a)l(l to consumers for use, in conmwrce among and between the nrions Stat<>s of the United States. Therespo)l(lE>nts' monthly sale of gasoline amounts to approximately 300,000 gallons.

PAR. 4. Among the respo11tlents' competitors is the Gulf Refining Company, a corporation, which is also engaged in the sale and distribution of gasoline and motor oils in bulk to retail d<>alers for resale and to consumers for use in the States of Louisiana, Mississippi, and GULF COAST OIL CO. OF :MISSISSIPPI, INC., ET AL. 77) IGO Findings Alabama. Since 1905 the Gulf Refining Company has built up a Wide reputation and extensive good-will among the users o:f the Products which it sells and said products are well and favorably known to the public generally.

A. special feature of its advertising that has been used to a great advantage for a period of many years is a sign in the form o:f a :rnetal disk, colored orange and bearing the one word "Gulf" in large black or dark blue shaded letters. The sign is usually suspended in front of the stations selling the products of the company and on its equipment generally. Prospective customers have been urged through Yarious mediums, over a period of many years, to buy-"At the Sign of The Orange Disk." The printed reproduction of the disk is the trade mark used to identify all the products o:f the company and is Painted upon its tanks, trucks, and other equipment. For a period of at least ten years all of the storage tanks, gasoline pumps, tank trucks, and equipment of the filling stations owned by the company luwe had the word "Gulf' printed thereon in letters of the same d1aracter and color as those on the disk above referred to and described.

The petroleum products distributetl and sold by the Gulf Refining Company include certain brands of gasoline and motor oils designat!'d by it as "Gulf Supreme Motor Oil," "Gulfpride Oil," and "Gulf N"o-Nox Ethyl Gasoline." The names by which these products are designated have been for a long time featured by the Gulf Refining Company in all :forms of its advertising at great expense and are definitely associated with and form an important part of the general Public's conception of the Gulf Refining Company and its products. 'fhe gasoline designated as "Gulf No-Nox Ethyl" sold by it is composed of a mixture of ordinary gasoline and tetraethyl lead which Is added to the gasoline for the purpose of increasing the efficiency of such gasoline as a fuel for modern type automobile motors. Gasoline to which tetraethyl lead has been added is also extensively ad- Yertised and sold by other competitors of the respondents who make tlse of the word "Ethyl," either alone or in conjunction with their own respective trade or corporate names, in advertising and desigllating their respective gasoline products. The use of the word ".Ethyl" to describe a certain type of gasoline, to wit: ordinary gasohne to which tetraethyl lead has been added in sufficient quantities to 1·aise the rating of said gasoline to a minimum of seventy-five (75) octanes, forms a distinctive and valuable advertising asset as the superior quality of and superior performance given by various types of "Ethyl" gasoline are wdl known to, and appreciated by, the con- 772 :FEDERAL TRADE COl\BIISSION DECISIONS Findings 24 F. T. C. suming public generally who pay a premium to obtain gasoline of that character.

Many of respondents' competitors who sell gasoline to which tetra- <>thyl l<>a<l has been added as dt:>scribed herein, make use of the word "Ethyl" as part of the brand name under which their respective gasolines are sold. and they display the word "Ethyl,'' either alone or in conjunction with their respective trade names on the various pumps from which said gasolines are dispensed. The pumps used by the Gulf Refining Company, its agents and dealers generally in dispensing gasoline of this type bear the words "Gulf No-Nox Ethyl Gasoline."

PAR. 5. Since about January 1, 1933, the corporate respondent has featured in all of its display advertising, on signs at various of its stations, on gasoline pumps, trucks and other equipment, the word "GULF," either alone or in printed letters substantially larger than those of the other words in connection with which it is used. The word "GULF" is always printed in shaded letters of the same type and black or deep blne color substantially the same as the letters and colors used by the said Gulf RPfining Company in its printing and ttse of the word "GULF."

Respondents have also extensively advertised one brand of the corporate respondents gasoline products as "Gulf Supreme Gasoline." The name of this brand of gasoline is featured on signs posted jn and about the various filling stations. These signs are about two and one-half feet high and eight to ten feet long, and are placed on a standard so that the sign is high enough up to give clearance to cars passing thereunder, and is, at many stations, illuminated by e.lectric lights at night. On these signs the word "GULF" appears in letters twice as large as the words "Supreme" and "Gasoline." The word "Supreme" on these signs is emphasized generally by enclosing said word in quotation marks. The respondents' corporate uarne, Gulf Coast Oil Company of Mississippi, Inc., sometimes appears on said signs in letters approximately one-third the size of the lettering in the W<mls "Supreme" and "Gasoline." The word Gulf is }>rintrtl in letters of the same type and with the same coloring as llSPd by the Gulf Refining Company in its printing and use of the wonl "GULF." The ad,·ettising of respondents' "Gulf Suprellle Gasoline" has been conduct<'<l furtlwr by means of radio broadcasts o,·er radio stations WSl\IB and WWL. Both of these stations Hre of sufficient power to carry the programs emanating therefrom to, into afid through States of the United States other than the State of Louisiana. Station WWL is a powerful station and its progmm cnn he heard all owr the United States. Respondents' GULF COAST OIL CO. OF :MISSISSIPPI, I:NC., ET AL. 773 7GO Findings various broadcasts are devoted entirely to advertising the gasoline designated as "Gulf Supreme Gasoline" and call attention to tho location of stations at which it may be obtained. The respondent's corporate name is not generally mentioned in these broadcasts. The principal type of gasoline now sold by the corporate respondent is designated and advertised extensively in newspapers having an interstate circulation and in other ways as "Gulf Either Gasoline.'' Gasoline pumps at the respondents' various filling stations located in the States of Louisiana, Mississippi, and Alabama have printed t!lereon in large letters the words "Gulf Either Gasoline." This particular type of gasoline is produced by adding small quantities, approximately eight (8) gallons, of commercial either to a tank car of approximately 8,000 gallons of ordinary gasoline. The amount of either added to said gasoline forms a small and insignificant part of the total volume of said gasoline when mixed. The addition of . such a small amount of commercial either fluid, a highly volatil() gas, to ordinary gasoline does not affect said gasoline to any noticeable extent and is not beneficial to said gasoline. The addition of either in such quantities does not increase the value, potency or power of said gasoline. The use of such quantity of commercial either addetl to ordinary gasoline does not make said gasoline any more beneficial to automobile motors and does not decrease the tendency of the motor ~0 knock or detonate. Gasoline to which such quantity of either fluid ~as been added does not perform with comparable efficiency to gasoln~e to which tetraethyllead has been added in such quantities as to 1'11tse the octane rating to 75.

The word "Either" when used in connection with the word "Gulf'' ~llrl "Gasoline" is n colorable imitation and simulation of the term ~ulf No-Nox Ethyl Gasoline" and of the term "Ethyl Gasoline" as l'tghtfu1Iy used by the Gulf Refining Company and many of the com- Petitors of the respondents.

I) 'fhe respondents have also made use of the terms "Pride of the l'ople'' and "Gulf 'Pride' l\Iotor Oil" to designate certain types of lllotor oil sold by the corporate respondent. Certain of the corporate l'e~pondent's signs and equipment, including oil containers and oil Pl~tnps display the term "Pride of the People." ,, fhe respondents have widely advertised the corporate respondent's Gulf Either Gasoline" and its "Pride of the People" and "Gulf 'P. t·tdc'" lubricating oils in newspapers of general cit·cul:ttion throughout the States of Louisiana, :\Iississippi, and Alabama. C PAn. 6. Neither the Gulf Refining Company nor the Ethyl Gasoline . orporation have given their permission to the respondents to usc, 111 th~ lltanller herein set out, or in any other manner, the terms Findings 24 F. T. G. "GULF," "Gulf Supreme Motor Oil," "Gulfpride Oil," "Gulf No- Nox Ethyl Gasoline," or "ETHYL" in designating the respondentsr various gasoline and motor oil products.

The use by the respondents in the manner described herein of the brand name "GULF'' and of the terms "Gulf Supreme Ga::;oline," "Gulf Either Gasoline," and "Pride of the People," and "Gulf 'Pritler Motor Oil" is such as to be colorable imitations and simulations of the aforesaid trade name of the Gulf Refining Company and its brand names for various gasolines and motor oils sold by it over a period of many years and the use of the term "Either" in describing corporate respondent's gasoline is such as to be a colorable imitation and simulation of the registered trade name "ETHYL" as used by the Ethyl Gasoline Corporation and its various licensees. PAR. 7. The acts and practices of the respondents, as detailed hereinabove, in imitating and simulating the products of the Gulf Refining Company and of other distributors selling various types of "ETHYL" gasoline has the capacity and tendency to confuse and · mislead the trade and the public generally with respect to the nature, quality, and origin of the various products sold by the corporate respondent. Under the ordinary conditions prevailing in the usual course of business in the sale of gasolines and motor oils the acts anJ practices of the respondents are such that members of the puhlic may be induced, by reason of such simulation and imitation of trade-marks and trade names as herein set out, to buy the corporate respondent's gasoline, motor oil, and other products in the belief that they are purchasing gasoline, motor oil, and other products distributed and sold by the Gulf Refining Company, its agents and dealers or gasoline distributed by other competitors of the respondents who are licensees of the Ethyl Gasoline Corporation. PAR. 8. Various types of gasoline perform with varying degrees of efficiency. The quality or grade of gasoline, with respect to eliminating motor knock or decreasing the tendency of the motor to d(>tonate, is susceptible of measurement and determination. This standard of measurement is expressed in terms of octane value. The gasoline having the highest octane rating is considered by the trade, and the purchasing public, to be the best and commanlls a higher price or premium accordingly. Gasolines to which tetraethyl lead is 11ddedr and which are sold to the trade and public as "ETHYL" gasoline have an octane rating of not less than 75 octanes. The respondents, in all of their advertising, radio broadcasts, newspaper advertising, and otherwise., represent that the corporate respondent's "Gulf Either Gasoline" tests 70 octanes and is equivalent GULF COAST OIL CO. OF MISSISSIPPI, INC., ET AL. 775 760 Conclm;lon to high test premium gasoline anu to "ETHYL'' ga:;oline for which a Premium is charged. The gasoline sold by the corporate respondent nt the time the hearings were concluctell in ~\august, 19;36, awl prior thereto, did. not always have the same octane rating. Different lots ?f gasoline purchased. by the corporate respondents for re:o;ale varied 1!1. octane value from 66 octanes up to 68 or 69 octanes. The greater Percentage of the purchases made were of 66 to 68 octane gasoline. ~gasoline having an octane rating of 70 or less is not comparable to either "ETHYL" or to other high test premium gasoline in performance or in elimination or reduction of motor knocks and. detonation. !he amount of either added to respondents' 66 to 68 octane gasoline ls sufficient to raise the octane rating as much as one point. PAn. 9. The statements and representations made by the respondents with respect to the quality of the corporate respondent's "Gulf Either Gasoline" and its effectiveness in use, in offering for sale and Selling said. "Gnl£ Either Gasoline" were calculated to, and had and now have, the tendency and capacity to mislead a substantial portion of the purchasing public into the erroneous beliefs that said repre- ~entations are true and that said "Gulf Either Gasoline" is comparable Jn value to, and gives equal performance with, various types of high test premium gasoline and "Ethyl" gasoline. As a direct consequence of the mistaken and erroneous beliefs induced by the aforesaid. acts and representations of the respondents, a number of the consuming public have purchased a substantial volume of corporate respondent's "Gulf Either Gasoline'' with the re- Sult that trade has been unfairly diverted to the respondents from competitors engaged in the business of distributing and selling various types of high test premium gasolines and "ETHYL" gasolines and who truthfully advertise their products and also ft·om competit?rs engaged in the distribution and sale of ordinary grades of gasohne, who truthfully advertise their respective products, both as to quality and. efficiency of performance.

CONCLUSION .The aforesaid acts and practices of the respondents, Gnlf Coast 0 11 Company of Mississippi, Inc., and Anthony PaciPra, are to the Prejudice of the public and of rpspondents' competitors, athl constitute unfair metholls of competition in commerce, within th~ intPut and meaning of Section 5 of an Act of Congress, approved. September 26, 1914, entitled "An Act to create a Federal Trade Conuni;;;sion, to define its powers and duties, and for other purposes." 776 FEDERAL TRADE COl\Il\IISSION DECISTO:NS ORDER TO CEASE AND DESIST This proceeding having been heard by the Federal Trade Coin· mission upon the complaint of the Commission, testimony and other evidence taken in support thereof and upon the answer filed herein on February 17, 1937, by the respondents, Gulf Coast Oil Company of Mississippi, Inc., and Anthony Paciera, admitting all the material al· legations of the complaint to be true and waivingthetakingoffurther testimony and all other intervening procedure, and the Commission having made its findings as to the facts and its conclusions that said respondents have violated the provisions of an Act of Congress approved September 2G, 1914, entitled "An Act to create a Federal Trade Commission, to define its powers and duties, and for other purposes."

It is ordered, That the respondents, Gulf Coast Oil Company of Mississippi, a corporation, its officers, and Anthony Paciera, an individual, and their respective representatives, agents, and em· ployees, in connection with the offering for sale, sale, and distribu· tion of gasoline, motor oils, and other petroleum products in inter· state commerce or in the District of Columbia, do forthwith cease and desist from:

1. Representing, directly or indirectly, in their advertising or in any other manner, by use of the trade name "ETHYL," or by use of the word "Either," or any other word or words closely simulating the trade name "ETHYL," either alone or in conjunction with any other word of words, or by use of any other means or device, that the gasoline sold by respondents contains tetraethyl lead or "ETHYL" fluid or that the respondents are licensees of the Ethyl Gasoline Corporation;

2. Uepresenting, throu~h use of the words or brand nan1es "GULF," "Gulfpride," "Gulf 'Pride'," "Gulf Supreme" awl "Pride of the People," or any other words closely simulating the aforesaid trade or brand names, either alone or in conjunction with any other word or words, or through the use of any symbol, term, or devicr, that respondents gasoline and motor oil products are those of the Gulf Uf:'fining Company;

3. Uepresenting, directly or indirectly, through any me:ws or de· vice that respondents' gasoline products Jun-e an octane rating higher than they actually possess;

4. Reprrsenting, directly or by implication, through any means or device, that respondents' gasoline products are tlie equal in elimiua· tion or rPdnction of motor knocks, detonation, or performance to GULF COAST OIL CO. OF MISSISSIPPI, INC., ET AL. 777 7Go Order "premium" gasolines having octane ratiugs of 75 or more, or to gasoline products which _in fact have a higher octane rating than respondents' gasoline and from comparing respondents' gasoline to "premium"- gasolines having a higher octane rating than respondents' gasoline vdthout specifically stating the respective ratings of each rrasoline · 5. Usingb the' word "Gulf" alone or in conjunction with any other ":ord or words as a brand or trade name for their gasoline or motor 011 products, or in adveliising, or in any other manner, unless the Word "Gulf" shall have the word "Coast" placed in close proximity thereto in letters of the same type and size and of equal prominence. p,,o'l.!ided, however, That the respondents are not hereby prohibited from using their entire corporate name or from using any trade or brand name which includes the words "Gulf Coast," in any manner 80 long as the use thereof does not conflict with section 5 hereof, or from using a yellow or orange color scheme on their stations, gasoline Pumps, and other equipment.

It i8 fur-ther ordered, That the respondents shall, within GO days of the service upon them of this order, file with the Commission a J·ep.ort in writing setting forth in detail the manner and form in whl<~h they have complied with this order.

Syllabus 24J!'.T.C·