Mutual Brief Case Co

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IN THE MATTER OF MUTUAL BRIEF CASE COMPANY COMPLAINT, FINDINGS, AND ORDER IN REGARD TO THE ALLEGED VIOLATION OF SEC. !5 OF AN ACT OF CO:\'GRESS APPROVED SEPT. 26, 1914 Docket 2889. Complaint, Aug. 7, 1936-Dccisio-n, Aug. 12, 1931 Where a corporation engaged in manufacture of leather luggage, and In use In such manufacture of two types of leather~ employed in making such luggage, namely, top grain leather and split leather, and in sale and distribution of such leather luggage in commerce among the various States and In the District of Columbia, In substantial competition with those engaged In manufacture, sale and distribution of leather goods In commerce, as above set forth, and including many competitors who sell leather luggage made from top grain leather and also that made from split leather, and properly describe former, as variously known by manufacturers, dealers, and purchasing public. as "cowhide" only, "genuine cowhide," ''leather," "genuine leather,'' "warranted leather," and "top grain," and properly describe latter, as similarly generally known, as "split leather" luggage-- Offered and sold, In Interstate commet·ce, its split leather goods, labeled allfl branded "cowhide" only, or "warranted genuine cowhide," In distinction from Its top grain leathl'r goods labPll'd and branded by it as "genuine top grain cowhide," notwithstanding fact such split leather luggage, thus brauded, was not made from outside or top side of hide, or from top grain, ns understood In trade and by· pun·hasing public, but was made from split leather, i. e., lower portion of hide, and from which top grain portion bus bee>n cut nway;

With cnpaeity and tendency to misle>ad and deeeh·e purchasing public and substantlnl portion of trade Into erroneous belief that its said luggage, thus branded and labeled, was made from top grain leather, for goods ot which purchasing public has generally pronounced and distinct preferenee, and with result of plncing in hands of wholesalers and retailers means whereby said luggage, made of split lenther as above set forth, and goods of which can be made to resemble those of other in appearance, Is passed off to purchnsing public ns top grain leather luggage, nnd consuming public purchas!'d sub:stantial volume of its aforesnid product, and trade was unfairly diverted to It from its competitors likewise engage(.} in manufacture, sale, and distribution of leather luggage, and who truthfully brand nnd represent kind of leather used in manufacture of their products; to the suhst.nntial injury of competition in commerce: lleld, That !mch acts nnd practices were to the prejudice of the public and competitors and constituted untnir methods of competition. llefore Mr. John L. l101•rwr, trial examiner. Mr. De lV itt T. Puckett for the Commission. Mr. Charles J. Fa99, of Newark, N. J., for respondent. FEDERAL TRADE COMl\IISSION DECISIONS804 Complaint 2::JF.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 Mutual Brief Case Company, a corporation, hereinafter referred to .as the respondent, has been and is using unfair methods of competition in commerce, as "commerce'' is defined in said act, and it appearing to the s·aid Commission that a proceeding 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. Said respondent, Mutual Brief Case Company, is n. corporation, organized and existing under the laws of the State of New York with its principal factory, warehouse and sales office at 133-135 l(ossuth Street, in the city of Ne,vnrk, in the State of New Jersey. Hcspondent is now and for more than one year last past, has been engaged in t.he manufacture of leather, leather luggage, leather brief cases, and leather golf bags and in the sale and distribution of the same, in commerce between and among the various States of the United States and the District of Columbia; causing said products, when sold, to be shipped. from its place of business in the State of New York to purchasers thereof located. in a State or States of the United States other than the State of New York. PAR. 2. In the course and conduct of its business aforesaid, respond.e~lt is now and for more than one year last past has been in substantial competition with other corporations, ind.ividuals, partnerships, and firms engaged in the business of manufacturing and selling leather luggage in commerce between and among the various States of the United. States and the District of Columbia. PAn. 3. In the course and conduct of its business as aforesaid, refpondent manufactures certain of its lucrcracre00 0 from split cowhide }eatlter, also d.escribed as the under or flesh side of the hide. Respond.ent places upon such luggage, and has done so during the period. aforesaid., a conspicuous stamp or label rending ''Cowhide Only" or ."Warranted Genuine Cowhid.e" as the case may be. Said ~tamp or label represents and. implies to the purchasing public that the material ~with which such luggage is covered is top grain leather, or as otherwise d.escribed, the outside or surface layer of the hide. Further, retailers are enabled by reason of said stamp or label, to mislead, deceive, and defraud. the purchasing public as to the quali_ty of the ~aterial with which such luggage is covered. Top grain leather is superior in quality, durability and price to the split leather. l\IUTUAL BRIEF CASE CO. 805 803 Findings The public generally believes the word leather to mean the top or hairy side of the hide.

There are among the competitors of respondent, as mentioned in Paragraph 1 hereof, manufacturers of leather luggage who do not in any way misrepresent or falsely label their said merchandise. PAR. 4. The above and foregoing representations, as shown by the label used by respondent, as described in paragraph 3, have the ca- Pacity and tendency to, and do mislead and deceive the purchasing Public into the belief that the said luggage so labeled is manufactured from, or covered with, genuine top grain cow hide, and have the capacity and tendency to, and do induce the said purchasing PUblic, acting in such erroneous belief, to purchase respondent's Product, thereby diverting trade to the respondent from those of its competitors who do not misrepresent and falsely label their product, ~nd in this manner respondent does substantial injury to competition In interstate commerce. ' PAn. 5. The above acts and things done or caused to be done by the respondent, were and are each and all to the prejudice of the Public and of respondent's competitors, and constitute unfair meth- ?ds of competition in interstate commerce within the meaning and Intent of Section 5 of "An Act to create a Federal Trade Commission, to define its powers and duties, and for other purposes," ap- Proved September 2G, 1914.

REPORT, FINDINGs AS TO THE Facts, AND Onder I Pursuant to the provisions of an Act of Congress approved Septe~ber 2G, 1914, entitled "An Act to create a Federal Trade Comnnssion, to define its powers and duties, and for other purposes," the ~ederal Trade Commission, on August 7, 193C, issued and served Its complaint in this proceeding upon respondent Mutual Brief Case Company, a corporation, charging it with the use of unfair methods of competition in commerce in violation of the provisions of said act. No answer to said complaint was filed. After the issuance of said c?lhplaint, testimony and other evidence in support of the allegations of said complaint were introduced by De Witt T. Puckett, attorney for the Commission before Jolm L. Hornor, an examiner of the Commission, theretofore duly designated by it, and said testillany and other evidence were duly recorded and filed in the office of the Commission. No testimony or other evidence in opposition to the allegations of the complaint was offered. Thereafter, the ~roeeeding regularly came on for final hearing before the Commis- Sion on the said complaint, testimony and other evidence, and brief in Findings 2!1F.T.C.

support of the complaint (no brief having been filed by respondent and no oral argument having been made) and the Commission having duly considered 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. The respondent, Mutual Brief Case Company, is a corporation doing business under the laws of the State of New York. The respondent's principal office and place of business is at 133-135 Kossuth Street, Newark, N. J.

For several years last past it has been engaged in the sale and distribution of leather luggage in commerce between and among the various States of the United States and in the District of Columbia. 'Vhen respondent's goods are sold, it causes them to be shipped from its place of business in Newark, N.J., to the purchasers thereof at their places of business in the various States of the United States and in the District of Columbia.

At all times since respondent has been in said business, it has been in substantial competition with other individuals, and partner· ships, and with corporations likewise engaged in the manufacture, sale, anu distribution, or in the sale and distribution of leather goods, in commerce, among and between the various States of the United States and in the District of Columbia. PAR. 2. Two general types of leather employed in the manufacture of leather luggage are top grain leather and split leather. Top gntin leather is the top portion of the hide from which the hair has been removed and the under portion or that lying next to the flesh of the animal has been cut away. Split leather is the lower portion of the hide which lies next to the flesh of the animal and from which the top grain portion has been cut away. The respondent uses both types of said leather in the manufacture of its luggage. Respondent's split leather goods offered for sale and sold in inter· state commerce are labeled and branded "cowhide only" or "warranted genuine cowhide." Respondent labels and brands its top grain leather goods "genuine top grain cowhide."

The purchasing public generally and the trade understand the words "cowhide only" or "warranted genuine cowhide," or the word ''leather,'' 'vhen use1l to describe luO'<TI\O'e to mean luO'<Yacre manufac· "'"' I">' ' to-"' .,tured from top grain leather. PAn. 3. l\lany of respondent's competitors sell leather luggllge manufactured from top grain leather and also from split leather. 1\IUTUAL BRIEF CASE CO. 807 803 Conclusion Said top grain leather is properly described by said competitors ~nd is variously known by manufacturers, dealers, and the purchas~ Ing public as "cowhide only," "genuine cowhide," "leather," "genuine leather," "warranted leather," and "top grain.'' Said split leather luggage is properly described by said competitors, and is generally known by manufacturers, dealers, and the purchasing public, as " sp I"It leather" lurrrrarrel:'l"" l:'l.

The purchasing public generally has a pronounced and distinct Preference for leather goods that are manufactured from top grain leather. Split leather goods can be made to resemble top grain leather in appearance and the purchasing public generally and a substantial portion of the trade cannot distinguish between split leather goods and top grain leather goods. As a result thereof, split leather goods are thus passed off as top grain leather goods. PAn. 4. The descriptions, representations, stamps, and brands used L~ respondent in describing its split leather luggage are false and ~l!sleading in that said luggage branded as "cowhide only" and '.warranted genuine cowhide" is not made from the outside or top side of the hide, or what is understood in the trade and by the purchasing public as top grain, but are manufactured from split leather. PAn. 5. The use by respondent of the descriptions, marks, and brands set out in paragraph 2 f1ereof, to describe its split leather luggage, offered for sale and sold in interstate commerce, has had and does have the capacity and tendency to mislead and deceive the purchasing public and a substantial portion of the trade into the erroneous belief that the lurrrrarrel:'ll:'l ~ so branded and labeled was made from t 0P grain leather. 1Jy said practices, respondent also places in the !tands of wholesalers and retailers the means whereby said luggage 18 Passed off to the purchasing public as top grain leather luggage. As a direct consequence of the mistaken and erroneous beliefs induced Ly the false and misleading representations above referred to, the consuming public has purchased a substantial volume of respondent's luggage with the result that trade has been unfairly diverted to the respondent from its competitors likewise engaged in the manufacture, Sale, and distribution of leather luggage, who truthfully brand and r~'present the kind of leather used in the manufacture of their prodllc~s. As a result thereof, substantial injury has been and is now herng done by respondent to competition in commerce among and between the various States of the United States and in the District of Columbia.

CONCLUSION 'I'he aforesaid acts and practices of the respondent, 1\futual Drief Case Company, are to the prejudice of the public and of respondent's Order 25F. T. C.

competitors, and constitute unfair methods of competition in 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."

ORDER TO CEASE AND DESIST This proceeding having been heard by the Federal Trade Commission upon the complaint of the Commission, testimony and other evidence taken before John L. Hornor, an examiner of the Commission theretofore duly designated by it, in support of the allegations of said complaint, and brief in support of the allegations of the complaint filed herein, no answer or brief having been filed by respondent and no oral argument having been made, 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 2G, 1914, entitled. "An Act to create a Federal Trade Commission, to define its powers and duties, nnd for other purposes." It is ordered, That the respondent, Mutual Drief Case Company, tt corporation, its officers, representatives, agents, and employes in connection with the offering for sale, sale, and distribution of Ju~gagc in interstate commerce or in the District of Columbia, do forthwith cease and desist from :

1. H.representing, through the use of the word "Cowhide," "\Varranted genuine cowhide," or "leather" or any other word or words of similar import and effect, alone or in conjunction with other words, stamped or imprinted on labels or on the luggage itself, or in any other manner, that luggage manufactured in whole or in part front .the underlayers or flesh sides of hides, known as split leather, is made ft·om the outside layer of the hide.

{2) Using the words "cowhide," "warranted genuine cowhide," or "leather" to describe or designate luggage manufactured in whole or in part from underlayers or flesh sides of hides. It is further ordered, That the respondent shall, within GO 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 lias complied with this order.

JOHN F. BOLON CIGAR CO. 809 Syllabus