Lechler Laboratories, Inc

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IN THE MATTER OF LECHLER LABORATORIES, INC.

CmiPLAINT, FINDI:\GS, AND ORDER IN REGARD TO Tile ALLEGED VIOLATION' OF SEC. 5 OF AN ACT OF CO~GRESS APPUOVED SEPT. 2(l, 1914 Docket 3115. Complaint, Apr. 26, 1937-Decision, July 21, 1931 'Where a corporation engaged in manufacture, sale and distribution of its "GGV Instantaneous Hair Llghten!'r," direct to consuming public, in substantial competition with those engaged in manufacture and distribution of like and similar products and sale thereof in commerce among the nrious States and in the District of Columbia, in advertising its said preparation through media of tlrice lists, advertisements, and other printed matter, published and circulated through the United States mails to customers and pro!<pectlYe customers in the various States and in said District- (a) Represented that bleaching agent of said product was not similar to peroxide and that it performed its bleaching action without said sullstance, and that it did not require or contain the same, and was superior to produets whi<'h did contain f'nch Fmhstance; and (b) Represented that suiu prounct was beneficial to permanent waves and blenclwd hair, and was hnrmlt>ss to the hair, and that it was the only preparation that would lightt>n tlte scalp, and that through use thereof there would lle no more dark roots ;

Facts being product in question did require peroxide, bleaching action of said Product was not chemically different from those containing such substance of like strength, it did not perform its llleaching action without said substance, was not more beuefidal to permanent waves and bleaehed hair than other similar and like preparations, or not only preparation that would lighten scalp, was not harmless to hair of users in many cases, and would not prevent dark roots, nud aforesaid various representations were uufuir, false, and misleading;

'With effect of misleading substantial portion of consuming public in the several States and in said District, by inducing them mistakenly nud erroneously to believe that said preparation required no peroxide, and that Other representations with respect thereto, as hereinabove set forth, were true, nnd with tendency and capacity so to mislead and deceive distributors and purchasing public, and with effect of inducing memllers thereof to buy its said product on account of such erroneous beliefs, and Of thereby unfairly diverting trade to it from competitors who do not make usc of same or similar rrpres!'ntations, acts or practices; to the sub- I stantlal injury of competition in commerce: Field, That snell nets ami praC'tlces were to the prejudice of the puhlic nml competitors and constituted unfair nwthods of competition. Mr. 8. Brogdyne Tete II for the Commission. Air. Willis B. Rice, of New York City, for respondent. 620 FEDERAL TRADE COl\IMISSION DECISIONS Complaint 25F.T. C.

Complaint 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 having reason to believe that Leehler Laboratories, Inc., a corporation, hereinafter referred to as respondent, has been and is now using unfair methods of competition in commerce as "commerce'' is defined in said ad, and it appearing to said Commission that a proceeding by it in respect tlwreof would be in the public interest, hereby issues its complaint, stating its <·charges in that respect as follows:

PARAGRAPH 1. Respondent, Lechler Laboratories, Inc., is a corporation organized and doing business under the laws of the State of New York, having its principal place of business at 33! Audubon Avenue, city of New York, State of New York. It is now, and for more than one year last past has been, engaged in the manufacture, sale, and distribution of a certain hair bleaching product designated as "Lechler '5G9' Instantaneous Hair Lighte11er" in commerce between and among the various Stat€'s of the United States and in the District of Columbia.

PAR. 2. When said product is sold, re!:'pondent transports or causes the same to be transported from its principal place of business in the city of New York, State of New York, to purchasers thereof located in other States of the United States awl in the District of Columbia. There is now, and has been at all time!:\ mentioned herein, a constant current of trade and commerce in said 11bove described product sold by respondent between and among the various States of the United States and in the District of Columbia.

PAR. 3. In the course and conduct of its said business, respondent is 11ow and has been in substantial competition with other corporations and with individuals, partnerships, and firms likewise engaged in business of distributing and selling hair bleaching nnd dyeing products in commerce among and between various States of the United States and in the District of Columbia. PAn. 4. In the course and conduct of its said business, respo!Hlcnt has caused to be printed and circulated through the Unite>d States mails to its customers and prospective customers in the various States of the United States catalogues, price lists and other printed matter, The respondent has also caused and still causl's advertisements to be inserted in newspapers and magazine>s l1aving a general interstate circulation. Each and all of the cataloO'ues 1n·ice t:> ' LECHLER LABORATORIES, INC. 021 619 Complaint lists, nnd advertisements contain statements which purport to be flescriptive of the efficacy, value, and merit of the respondent's prod· net. Among the statements made in the aforesaid catalogue, price list, newspaper and magazine advertisements, the following are representative:

LIGHTEN YOUR HAIR WITHOUT PEROXIDE "' "' • to ANY shade you Desire • • "' SAFELY in 5 to 15 minutes Coreful, fastidious women ovoid the use of peroxide because peroxide makes hair brittle. LECHLER'S INSTANTANEOUS HAIR LIGHTENER requires NO peroxide. Used as a poste, it can not streak. Eliminates "straw" look. BENEFICIAL TO PERMANENT WAVES AND BLEACHED HAIR Lightens blonde hair grown dark. This is the only preparation that also lightens the scalp. No more dark roots. Used over 20 years by famous beauties, stoge and screen stars and children. Harmless. Guaranteed. Mailed complete with brush for application. $1.

PAn. 5. Through use of the foregoing statements and others similar thereto, the respondent represents, either directly or by implication, that the said Lechler's Instantaneous Hair Lightener requires no I>e.roxide; that the bleaching agent of its product is not similar to peroxide and performs its bleaching action without peroxide; that its product does not contain peroxide and is superior to products containing peroxide; that it is beneficial to permanent waves and bleached hair; that it is the only preparation that will lighten the ~scalp; that through its use there will be no more dark roots; that it lS harmless to the hair of the user.

PAn. 6. In truth and in fact, the respondent's product is composed 'Of such ingredients that when said product is used its bleaching ttction is actually accomplished by hydrogen peroxide. Respondent's ~product does contain peroxide and its bleaching action is not substan· hally different from other products containing peroxide. Said prod· ltct is not beneficial to permanent waves and bleached hair and has the same, or similar effect as other producfs using peroxide. It is llot the only preparation that will lighten the scalp and its use will not prevent dark roots. As hair grows out, the new hair showing {l.bove the scalp will be the same color as the hair before use of the Product. The respondent's product is not harmless to the hair of the user in many cases.

PAn. 7. Each and all of the false and misleading statements and ~he representations made by the respondent in designating or describ· Ing its pt·oduct and the effectiveness of said product for lightening the hair and treatin~ conditions of the hair and scalp in offering for -sale and selling its said product were and are calculated to and had and now have a tendency and capacity to mislead a substantial por- Findings 25F. T. C.

tion of the purchasing public into the erroneous belief that all of said representations are true and that said product will in truth accomplish the results claimed.

Further, as a direct consequence of the mistaken and erroneous beliefs induced by the acts and representations of the respondent as hereinabove detailed, a number of the consuming public have purchased a substantial volume of respondent's product with the result that trade has been unfairly diverted to the respondent from competitors likewise engaged in the business of distributing and selling similar products or other products designed and sold for use in the treatment of various conditions of the scalp and hair and other conditions named herein who truthfully represent the effectiveness of their respective products.

PAR. 8. The foregoing false and misleading statements and representations on the part of respondent are inducements for a substantial number of consuming purchasers to form the mistaken and erroneous beliefs above referred to and to buy the product distributed and offered for sale by respondent. And as a result, a substantial volume of trade has been and is now being diverted to respondent from competitors engaged in similar business who truthfully advertise and represent, through their catalogues, prices lists, and advertisements, the nature, merit and value of their products. As a consequence thereof, a substantial injury has been done to substantial competition in commerce among the several States of the United States and in the District of Columbia.

PAR. 9. The above and foregoing acts, practices, and representa· tions of respondent have been and are all to the prejudice of the public and respondent's competitors and have been and are unfair methods of competition within the meaning and intent of Section 6 of an Act of Congress, approved September 26, 1!>14, entitled "An Act to create a Federal Trade Commission, to define its powers and duties, and for other purposes."

REPORT, FINIHNGS AS TO THE FACTS, AND Onder Pursuant to the provisions of an Act of Congress approved September 26, 1914, entitled ''An Act to create a Federal Trade Commis· sian, to define its powers and duties, and for other purposes," the Federal Trade Commission, on April 28, 1937, issued and served its complaint in this proceeding upon respondent, Lechler Laboratories, 1nc., charging it with the use of unfair methods of competition in commerce in violation of the provisions of said act. After the issu· ance of said complaint, and the filing of respondent's answer t}H.•retot LECHLER LABORATORIES, INC. 623 619 Findings a stipulation as to the facts was entered into between ·w. T. Kelley, Chief Counsel of the Commission, and Willis D. Rice, counsel for respondent, which said stipulation was thereafter approved by the Commission. Thereafter, the proceeding regularly came on for final hearing before the Commission on the said complaint, and answer thereto, and the stipulation as to the facts (respondent having waived the filing of brief); and the Commission having duly consid.ered the same and being now 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 THE FACTS PARAGRAPH 1. Respondent, Lechler Laboratories, Inc., is a New York corporation organized and doing business by virtue of and under the laws of the State of New York.

PAn. 2. Respondent has been for more than one year last past engaged in the business of manufacturing, selling, and distributing ''Lechler '!:JG9 Instantaneous Hair Lightener'" direct to the consuming public.

PAn. 3. In the sale of said product respondent has transported or caused the same to be transported from its principal place of business in the State of New York to purchasers thereof located in States of the United States other than the State from which shipment originated and in the District of Columbia. There has been for more than one year last past, and still is, a constant current of trade and commerce in said "Lechler '5GO Instanttaneous Hair Lightener'" so sold and distributed by respondent between a.nd among the various States of the United States a.nd in the District of Columbia.

PAll. 4. For more than one year last past the respondent has been engaged in substantial competition with individuals, patinerships, firms, and other corporations engaged in the manufacture and distribution of like and similar products, and in the sale thereof in commerce between and amOJ'g the various States of the United States and in the District of Columbia.

PAn. 5. In the course and conduct of its business as a.foresaid, the :respondent, in soliciting the sale of, and in selling, its product, a.nd fo:r tho purpose of creating a demand on the part of the consumincr Public for said product, has for more than one year last past caused t~e product to be advertised through the media of price lists, ad,·erhsements, and other printed matter published, issued, and circulated through the United Stutes mails to its customers and prospecti,·e l5812tm--30----42 624 FEDERAL TRADE COMl\IISSION DECISIONS Findings 25 F. T. C. customers in the various States of the United States and in the District of Columbia. In said ways and by said means respondent has made to the general public many unfair, false, and misleading statements with reference to the commodities offered for sale by it. PAn. 6. Among the unfair, false, and misleading statements made by the respondent with reference to the commodities offered for salo by it are the following:

That Lechler Instantaneous Hair Lightener requires no peroxide; that the bleaching agent of said product is not similar to peroxide; that the said product performs its bleaching action without peroxide; that said product does not contain peroxide; that said product is superior to products containing peroxide; that said product is beneficial to permanent waves and bleached hair; that said product is the only preparation that will lighten the scalp; that through the use of said product there will be no more dark roots; an<l that said product is harmless to the hair of the user. PAR. 7. The aforesaid representations are untrue in that Lechler Instantaneous Hair Lightener does require peroxide, and that the bleaching action of said product is not chemically different from the products containing peroxide of like strength. Said procluet does not perform its bl<>aching action without prroxide. Said product does contain peroxide. Said product is not more bE-neficial to permanent waves and bleached hair than other similar and like preparations. Said product has the same or similar action as other products using peroxide of like strength. Said product is not the only preparation that will lighten the scalp, and its use will not prevent dark roots, and said product is not harmh>ss to the hair of the users in many cases.

PAn. 8. The effect of the foregoing false and misleading repre· sentations and acts of the respondent in selling and offering for sale the items of merchandise herein described is to mislead a subf'tantial portion of the consuming public in the sewral States of the United Stat~s and in the District of Columbia by inducing them to mistakenly and erroneously believe that: Lechler Instantaneous Hair Lightener requires no peroxide; the bleaching agent of the Hair Lightener is not similar to peroxide; !he Hair Lightener performs its bleaching action without peroxide; Its product does not contain peroxide; it is superior to products containing peroxide; it is beneficial to permanent waves and bleached ~tair; it is the ~nly preparation that will light:Rn the scalp; through 1ts use there w11l be no more dark roots; and it is harmless to the hair of the user.

LECHLER LABORATORIES, INC. 625 61\) Ordrr P.m. 9. The use of each and all of the foregoing false and misleading statements and representations as herein set out has had, <llld now has, a tendency and capacity to mislead and deceive distributors and the purchasing public into the erroneous and mistaken belief that the said statements and representations are true, and has induced and still induces members of the public to purchase the product of said respondent on account of said erroneous beliefs. Said representations have thereby unfairly diverted trade to said respondent from competitors who do not make use of the same or similar representations, acts, or practices, and substantial injury lias been done by respondent to competition in commerce among nnd between the several States of the United States and in the District of Columbia.

CONCLUSION The aforesaid acts and practices of the respondent, Lechler Laboratot·ies, Inc., a corporation, are to the prejudice of the public- and of respondent's competitors, alld constitute unfair methods of competition in commerce, within the intent and meaning of Section 5 of an Act of Congress, approved September 26, 1014, entitled "An Act to create a Federal Trade Commission, to define its powers and tlnties, and for other purposes."

ORDER TO CEASE AND DESIST This proceeding having been heard by the Federal Trade Com- Inission upon the complaint of the Commission and the answer of I·respondent, and a stipulation as to the facts entered into between W. T. Kelley, Chief Counsel of the Commission, all<l Willis l3. Rice, counsel for respondent (respondent having waived the filing of a brief), and the Commission having made its findings as to the facts and its conclusion that said respondent has violated the pro. \'isions of an Act of Congress approved September 26, 1914, entitled ''An Act to create a Federal Trade Commission, to define its powers hnd duties, and for other purposes."

It i8 01'dered, That respondent, Lechler Laboratories, Inc., its officers, l"representatives, agents, and employes, in connection with the ntlvertising, offering for sale, sale, and distribution, in intprstate (;<>IUmerce, or in the District of Columbia, of a hair bleaching produ_et now known as Lechler Instantaneous Hair Lightener, or of any 81Illilur pt·eparation containing substantially the same ingredients Under the same or under any other name or names, do forthwith (:ease and desist from representing, directly or indirectly, through 626 FEDERAL TRADE COl\IMISSION DECISIONS Order 25F.T,C.

price lists, circulars, labels, or any other form of printed matter, or hy radio broadcasting or in any other manner: 1. That the bleaching agent of said product is not similar to peroxide, and that it performs its bleaching action without peroxide; 2. That said product does not require or contain peroxide; 3. That said product is superior to products containing peroxide; 4. That said product is beneficial to permanent waves and bleached hair, and is harmless to the hair of the user; and 5. That said product is the only preparation that will lighten the scalp, and that through the use of said product there will be no more dark roots.

It i8 further ordered, That the respondent shall, within 60 days after service upon it of this order, file with the Commission a report in writing setting forth in detail the manner and form in which it has complied with the order herein set forth. NODOZ LAnORATORIES1 INC. 627 Syllabus