Christmas Club

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IN THE MATTER OF CHRISTMAS CLUB COMPLAINT, FINDINGS, AND ORDER IN REGARD TO THE ALLEGED VIOLA'J'IO~ OF SEC. 5 OF AN ACT OF CONGRESS APPROVED SEPT. 26, 1914, AND OF SECS. 3 A:'\D 2 (a) OF AN ACT OF CONGRESS APPROVED OCT. HI, 1914, AS AMENDED B ¥ SEC. 1 OF AN ACT OF CONGRiilSS APPROVED JUNE 19, 1036 Docket 9050. Complaint, Feb. 5, 1931-Decision, Sept. SO, 1931 Where a corporation engaged, for more than three years last past, in the sale, in commerce among the various States and in the District of Columbia, of pass books, account books, advertising literature, and other paraphernalia for use by banks and trust companies in their conduct of Christmas Clubs and other savings systems, in substantial competition with others engaged in sale in commerce of systems for use by banks and trust com· panies and their depositors in the conduct of such clubs and other savings systems, and, as thus engaged, ln furnishing such systems for such purposes to more banks and trust companies for their use than any of its competitors, with annual revenues from such activity during aforesaid period likewise exceeding that of any other of said competitors- (a) Itepresented that it bad the right to the sole and exclusive use of name or phrase "Christmas Club" for its Raid systems, and that said name bad been trade-marked by it for line thcrPon, facts being that, while it was owner of registered trade-mark "Christmas Club" for use as magazine title, said name or phrase bad not been registered by it as trade-mark tor its said system, nor had it established in any court of competent jurisdiction its sole and exclusive right to use of name or phrase in question thereon;

(b) Represented that it was the manufacturer and printer of its said systems, through inclusion in certain of its contract forms of statement that its said systems would be shlppPd f. o. b. its factories, facts being that appro:S:· imately ninety-five percent of its said systems, furnished by it to bank.9 and trust companies, were made for its order by manufacturing printing concerns In which it bad no financial or other Interest, while approximately five percent thereof were printed by affiliated corporations, stock of wblcb, along with a part of its own stock, was held by another concern; (c) Represented that It bad spent, over a period of time, more than $3,500,000 In promoting the Christmas Club name and !den among the banks and people of the United States, facts being said figure represented an arbitrary fraction of tbe total selling expenses, other than cost of goods sold and executive sellng expenses over a period of years, ot itself and certain other companies, assets of which had been acquired by it; With capacity and tendency to mislead certain banks and trust companies purchasing such systems from it into believing that such representations as aforesaid, as to such right to use of said name or phrase and as to manufacture of said systems, W{'re true, and to induce them to buy such systems from it In such erroneous bellef, and as manufactured and printed by It, and with effect of inducing banks and trust companies to purchase said products from it without knowing sense in which word "promotion" CHRISTl\IAS CLUB 1117 1116 Comp~aint was used, and of diverting trade to it from its competitors; to the substantial injury of substantial competition in commerce: Held, That such acts and practices were to the prejudice of the public and competitors and constituted unfair methods of competition in commerce within the Intent and meaning of said Section 5 of an Act of Congress appro\·ed Sept. 26, 1914; and Where aforesaid corporation, engaged as above set forth- (d) Entered Into contracts for and made sales of its said systems on the condition, agreement, and understanding that purchaser thereof should not Purchase or deal in the systems of a competitor or competitors, undet· contracts, many of which were for term of ~even years and provided that the bank or trust company concerned should purchase such systems from it exclusively;

With result that companies having such contracts with It, by reason thereof, did not buy systems of competitors, and with the result that pffcct of such contracts had been and was to substantially Jessen competition or tend · to create a monopoly in 1t:

Held, That such acts and practices, under the circumstances set forth, constituted violation of the provisions of Section 3 of an act of Congress approved Oct. 15, 1914; and Where aforcsuld corporation, engaged 'as above set forth- (e) Discriminated In price through failing to provide for payments on tht> same percentage basis In contracts entered Into and carried out by It with banks and trust companies, providing thllt It would furnish such systems, of lil;:e grade and quality, to pach bunk or trust company and would accept In payment therefor a percentage of the deposits In the Christmas Club of the particular company, with the particular comp'llny, as the case might be, privileged under the terms of such contracts to requisition unlimited quantities of said systems from it, regardll'ss of rate of percentage paid by it or regardless of the total deposits In Its Christmas Club; With the result that the effect of such discrimination in price between different purchasers of systems of like grade 'and quality had been and was to substantially lessen competition or tend to create a monoply in interstate commerce in such systems:

Held, That such acts and practices, under the circumstances set forth, constituted a violation of the provisions of Sec. 2 (a) of an act of Congress approwd Oct. 15, 1914, as amended by Sec. 1 of an Act of Congress approved June 19, 1936.

Before !Jfr. John ;lV. Norwood, trial examiner. ill r. Edward L. Smith for the Commission.

Oravath, DeGersdorjf, Swaine & lVood and AIr, Henry G. ,lValter, Jr., of New York City, and Mr. Richard II. lVllmer, of Washington,_ n. c., for respondent.

COMPLAINT Oount I 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,''" r Complaint 25F. T. C.

the Federal Trade Commission, having reason to believe that Christ· mas Club, a corporation, hereinafter referred to as respondent, has been and now is using unfair methods of competition in com· merce as "commerce" is defined in said act, and it appearing to said Commission that a proceeding by it in respect thereof would be to the public interest, hereby issues its complaint stating its charges in that respect as follows:

PARAGRAPH 1. Respondent Christmas Club, a corporation, is a corporation organized, ex.isting, and doing business under and by virtue of the laws of the State of New York with its principal office and place of businesss at 341 :Madison Avenue, New York City in said State. It is now and for more than three years last past has been engaged in the sale of passbooks, account books, advertising literature, and other paraphernalia for use by banks and trust com· panies in the conduct by them of Christmas Clubs and other saving systems, which said passbooks, account books, advertising literature, and other paraphernalia will hereinafter be referred to as "systems." In the course and conduct of its said business, it now ships and for more than three years last past has shipped from its place of business in New York City aforesaid, such "systems" when sold by it, to the purchasers thereof located in the State of New York, and others located in various other States of the United States and in the District of Columbia. Such "systems" are sold by respondent for use by banks and trust companies and their depositors in the various States of the United States and in the District of Columbia. There is now and for more than three years last past has beeen a constant current of trade and commerce by respondent in such "systems" be tween and among the various States of the United States and in the District of Columbia. In the course and conduct of its business, respondent is now and for more than three years last past has been in substantial competition with other corporations and with persons, firms, and partnerships engaged in the sale of "systems" for use by banks and trust companies and their depositors in the conduct of Christmas Clubs and other saving systems, between and among the various States of the United States and in the District of Columbia. The conduct of Christm.as Clubs and .other saving systems is a -pop· ular form of saving and their favor with the public is increasing and the use of such Christmas Clubs and other saving systems is a very important factor in the conduct of banks and trust companies. Respondent is now and for more than three years last past has been the largest single dealer in the United States in "systems" for use by banks and trust companies in the conduct of Christmas Clubs CHIUSTMAS CLUB 1119 1116 Complaint and of other saving systems and now sells and for more than three years last past has sold "systems" to more banks and trust companies than has or does any of its aforesaid competitors. PAn. 2. In the course and conduct of its aforesaid business between and among the various States of the United States and in the District of Columbia, respondent in selling and in offering for sale its "systems" has falsely represented and still falsely represents that it is the sole owner of and has exclusive right to the use of the phrase "Christmas Club," that said phrase is trademarked by respondent, and that no one without its consent or license has the right to use the aforesaid name, "Christmas Club." In truth and in fact respondent is not and ~as not been the sole owner of the phrase "Christmas Club"; nor has It ever had the exclusive right to the use of the said phrase "Christlhas Club"; the said phrase "Christmas Club" is not trademarked by respondent; and the aforesaid phrase may be used by others without the consent, permission, or license of the respondent. PAn. 3. In the course and conduct of its aforesaid business between and among the various States of the United States and in the District of Columbia, respondent in selling and in offering for sale its "systems" has falsely represented and still falsely represents that it is the manufacturer and printer of the "systems" which it sells, when in truth and in fact it is not the manufacturer thereof, but such "systems" are manufactured for the respondent by manufacturing and printing concerns in which the respondent has no financial or other interest.

PAn. 4. In the course and conduct of its aforesaid business between and among the various States of the United States and in the District of Columbia, respondent in selling and in offering for sale its "systems" has represented and still represents to its customers and Prospective customers that it has been and is still spending on advertising and promoting the growth of Christmas Clubs throughout the country, amounts of money considerably in excess of the amounts it has expended and is still expending for the. purpose aforesaid. PAR. 5. The aforesaid representations made by the respondent as set out in paragraphs 2, 3, and 4 hereof, have had and still have the capacity and tendency to mislead and deceive, have misled and deceived, and do mislead and deceive purchasers and prospective purchasers into the beliefs that the aforesaid representations are and have been true, and have tended to and do tend to induce, and have induced and do induce banks and trust companies to purchase "systems'' from respondent in such erroneous beliefs. Thereby trade has been diverted and is being diverted by respondent from its com- 15812tm--39----73 Complaint 25F. T. C.

petitors and substantial injury has been done and is being done by respondent to substantial competition in interstate commerce. PAR. 6. The above alleged acts and practices of respondent are all to the injury and prejudice of the public and respondent's competitors and constitute unfair methods of competition within the intent and meaning of Section 5 of an Act of Congress entitled "An Act to create a Federal Trade Commission, to define its powers and duties, and for other purposes," approved September 26, 1914. Oount II The Federal Trade Commission having reason to believe that Christmas Club, a corporation, hereinafter called respondent, has violated and is now violating the provisions of Section 3 of the Act of Congress entitled "An Act to supplement existing laws against unlawful restraints and monopolies, and for other purposes," approved October 15, 1914, (the Clayton Act), hereby issues this its complaint against respondent and states its charges with respect thereto as follows, to wit:

PARAGRAPH 1. For its charges under this paragraph of this count~ said Commission relies upon the matters and things set out in paragraph 1 of count 1 of thi:3 complaint to the same extent and as though the allegations of said paragraph 1 of said count 1 were set out in full herein, and said paragraph 1 of said count 1 is incorporated herein by reference and made a part of the allegations of this count.

PAR. 2. In the course and conduct of its business described in paragraph 1 of count 1, respondent in the course of commerce between and among the various States of the United States and the District of Columbia described in said paragraph of said count, has made sales and is still making sales and contracts for the sale of ''systems'' on the condition, agreement, and understanding that the purchasers thereof shall not deal in the "systems'' of a competitor or eompetitors of respondent, the effect of which said sales and contracts for sale upon such condition, agreement, and understanding may be, is and has been to substantially lessen competition or tend to create a monopoly in respondent in commerce between and among the various States of the United States and in the District of Columbia in "systems."

PAR. 3. The aforesaid acts of respondent constitute a violation of the provisions of Section 3 of the hereinabove mentioned Act of Congress entitled "An Act to supplement existing laws against unlawful restraints and monopolies, and for other purposes, approved October 15,1914 (the Clayton Act).

CHRISTMAS CLUB 1121 1116 Complaint Count Ill The Federal Trade Commission having reason to believe that Christmas Club, a corporation, hereinafter called respondent, since June 19, 1936, has violated and is now violating the provisions of Section 2 (a) of the Act of Congress entitled "An Act to supplement el:isting laws against unlawful restraints and monop6lies, and for other purposes," approved October 15, 1914, (the Clayton Act), as alll.ended by Section 1 of the Act of Congress entitled "An Act to l\Ilj.end Section 2 of the Act entitled 'An Act to supplement existing laws against unlawful restraints and monopolies, and for other pur- Poses,' approved October 15, 1914, as amended (U.S.C., title 15, sec. 13), and for other purposes," approved June 19, 1936, (the Robinson- Patrnan Act), hereby issue:;; this its complaint against Respondent and states its charges with respect thereto as follows, to wit: ~ ARAGRAPH 1. For its charges under this paragraph of this count, said Commission relies upon the matters and things set out in paragraph 1 of count 1 of this complaint to the same extent and as though the allegations of said paragraph 1 of said count 1 were set out in full herein, and said paragraph l: of said count 1 is incorporated herein by reference and made a part of the allegations of this count.

PAR. 2. Since June 19, 1936, in the course and conduct of its business described in paragraph 1 of count 1 hereof, respondent while engaged in the commerce therein described, in the course of such ~ 0~merce, directly and indirectly has discriminated and is still dis- ~·l'Iminating in price between different purchasers of "systems" of .blke grade and quality, the effect of which said discriminations may . e to substantially lessen competition or tend to create a monopoly In the aforesaid commerce in ''systems," or to injure, destroy, or pre- Vent competition with respondent.

PAn. 3. The aforesaid acts of respondent constitute a violation of the provisions of Section 2 (a) of the above mentioned Act of Congress entitled "An Act to supplement existing laws against unlawful restraints and monopolies, and for other purposes," approved Oc- ~ber 15, 1914, (the Clayton .Act), as amended by Section 1 of the ct of Congress entitled "An Act to amend Section 2 of the Act entitled 'An Act to supplement existing laws against unlawful restr · paints and monopolies, and for other purposes,' approved October 15' 1914, as amended (U.S.C., title 15, sec. 13), and for other pur- Poses," approved June 19, 1936 (the Robinson-Patman Act). Findings 25 F. T.C. REPORT, FINDINGS AS TO THE FACTS, AND ORDER Pursuant to the provisions of an Act of Congress approved Sep· tember 26, 1914, entitled "An Act to create a Federal Trade Corn· mission, to define its powers and duties, and for other purposes, " and pursua~ to the provisions of an Act of Congress approved October 15, 1914, entitled "An Act to supplement existing la:w~ ugainst unlawful restraints and monopolies, and for other purposes, the Federal Trade Commission on February 5, 1937, issued, and on February 8, 1937, served, its complaint in this proceeding upon re· ~pondent, Christmas Club, a corporation, charging it with the use of unfair methods of competition in commerce in violation of the provisions of said act, entitled "An Act to create a Federal Trad~ Commission, to define its powers and duties, and for other purposes, and with violating Section 3 of the aforesaid act entitled "An Act to supplement existing laws against unlawful restraints and mon~p­ ulies, and for other purposes," approved October 15, 1914, and wlth violating Section 2 (a) of the said Act entitled "An Act to suppled ment existing laws against unlawful restraints and monopolies, an for other purposes," as amenued by Section 1 of an Act of Congres; ~tpproved June 19, 1936, entitled "An Act to amend Section 2 ° the Act entitled 'An Act to supplement existing laws against unb"'d ful restraints and monopolies, and for other purposes,' approve October 15, 1914, as amend.cd (U. S. C., title 15, sec. 13), ancl ~or either purposes." After the issuance of said complaint and the fi.l~1g of respondent's answer, the Commission, by order entered hereUl, granted respondent's motion for permission to withdraw said answer und to substitute therefor an amended answer, in which respondent E>tateu that while not conceuing that it has violated any law of the United States, nevertheless for the sole purpose of avoiding the tro~ble and expense incidental to further continuation of this proceed1?g~ it uesired to waive hearing on the charges set forth in said complai!1 and not to contest the proceeding, and solely for the purpose of dis· posing of this proceeding consented that the Commission might, without trial, without the taking of evidence and without !Uly fn~­ ther procedure enter its findings as to the facts, including ~uc ~ inferences as the Commission might draw from the facts aum1tte in the said amended answer, and issue and serve upon it an orde~ to cease and desist from the acts admitted in the said amende t answer, and in which said amendeu answer respondent stated th~ dl consents and admissions given or made by the respondent there!ll were given and made solely on the conditions anu for the purpos~s aforesaid and insofar as they constituted admissions were not 11111 e CHRISTl\IAS CLUB 1123 1116 Findings as, nor were they to be taken as, admissions of fact for any other Purpose or in any other proceeding whatsoever. Thereafter, this ~roceeding regularly came on for final hearing before the Commis- 81011 on the said complaint and said amended answer (briefs and 0.ral arguments of counsel having been waived), and the Commis- ~1011 having duly considered the same and being now fully advised In the premises, finds that this proceeding is in the interest of the )ubiic and. makes this its findings as to the facts and its conclusions c rawn therefrom.

FINDINGS AS TO THE FACTS PARAGRAPH 1. The respondent is a corporation organized, existing, ~Id doing business under and by virtue of the laws of the State of ~ ew. York, with its principal office and place of business at 341 • fact.Ison A venue, New York City, in said State. PAR. 2. The respondent is now and for more than three years 1 blst past has been engaged, among other things, in the sale of passf ooks, account books, advertising literature, and other paraphernalia .use by banks ami trust companies in the conduct by them of 0°1' hrtstmas Clubs and other savings systems (which said passbooks, ]accountle · books, advertising literature, and other paraphernalia are reinafter referred to as "systems") . .PAn. 3. In the course and conduct of its business, the respondent I~ow causes to be shipped and for more than three years last past has ~Ullsed to be shipped such "systems," when sold by it from Harrisp urg, Pa., to the purchasers thereof, some located in the State of Ue~nsylvania and others lo~at~d in various. other States ~f the llJted States and in the Drstnct of Columbia; and there Is now an<J. for more than three years last past has been a constant current of trade and commerce by the respondent in such "systems" between ;~c1 among the various States of the United States and in the Distict of Columbia .

. PAn. 4. In the course and conduct of its business, the respondent 1 ~ now, and for more than three years last past has been, in sub- ~tantial competition with other corporations and with persons, firms, •llld Partnerships encra()'ed in the sale of "systems" for use by banks ~nd trust compauieso a~d their depositors in the cond.uct of Christ- 1a8 Clubs and other savings systems in commerce between and a~ong the various States of the United States and in the District .o PColumbia.

c An. 5. In 1936 there were approximately 17,800 banks and trust ~l1Panies throughout the United States, of which approximately5 ' CO operated Christmas Clubs.

1124 }'EDERAL TRADE COMMISSION DECISIONS Findings 25F. T.C.

PAR. 6. The respon<lent now furnishes, and for more than three years last past has furnished, "systems" to more banks and trust companies, for use by them in the conduct of Christmas Clubs and (Jther savings systems, than has or does any one of its competitors. PAR, 7. The annual revenues of the respondent from furnishing ''systems" to banks and trust companies now exceeds, and for more than three years last past has exceeded, that of any of its competitors. PAR. 8. While prior to 1934 the respondent represented to banks or trust companies that it had the sole and exclusive right to the use of the name or phrase "Christmas Club" and represented that such name or phrase had been trade-marked by it for use on "sys· tems," during the past three years it has not made such representa· t ions except as to the name of a magazine. PAR. 9. In 1910 Merkel Landis conceived the Christmas Club plan and in 1911 transferred to the Landis Savings Club Company all of his rights, title, and interest in the plan. Early in 1912 Mr. Jl, F. Rawll acquired from the Landis Savings Club Company the right • to use the plan. l\Ir. llawll immediately gave the plan the name "Christmas Club~' and operated his business under the unincorpo· rated name "Christmas Club" from March 1912, until June 1914, when he incorporated his business under the name "Christmas Club, A. Corporation," the respondent herein. The respondent subsequen~Iy acquired all the assets of the Landis Savings Club Company. "\Vhile prior to 1934 the respondent represented that it had the right to the exclusive use of the name or phrase "Christmas Club," it has not · established such right in any judicial proceeding. From time to time, various persons, firms and corporations, other than the respond· ent, have been engaged in the business of supplying banks and trus~ companies with "systems" inscribed with the name "Christmas Club' for use in the operation of Christmas Clubs and from 1929 to 1932, inclusive, the respondent acquired the assets of a number thereo:f for a substantial consideration.

PAR. 10. Since March 1927, the respondent has been and now is the owner of the registered trade-mark "Christmas Club" for use as the title of a magazine in Class 38 (Reg. No. 225139), but the name or phrase "Christmas Club" has not been so registered by it as a trade· mark for "systems.'' The aforesaid representations made prior to 1934, that the respondent had the sole and exclusive right to the use of the name or phrase ''Christmas Club" without having registered it or having established it in a court of competent jurisdiction, ttnd· that such name or phrase had been trade-marked by it for use on "systems" without having registered it or having established it in °~ by a court of competent jurisdiction for use on "systems" has ha CHRISTMAS CLUB 1125 1116 Findings the capacity and tendency to mislead certain banks and trust companies purchasing such "systems" from the respondent into believing that such representations were true and to purchase "systems'' from respondent in such erroneous beliefs.

P AU. 11. Certain forms of contracts entered into by the respondent Prior to the issuance of the complaint herein contained the statement that "systems" would be shipped "f. o. b. its factories." However, approximately 95% of the "systems'' furnished to banks and trust companies by the respondent are manufactured for its order by lhanufacturing and printing concerns in which the respondent has ho financial or other interest and approximately 5% of such "systems" are printed by affiliated corporations, the stock of which is owned by a corporation which also owns a part of the stock of the respondent. All "systems" furnished by the respondent are manufactured and Printed for it under its directions and instructions. Said statement contained in such forms of contracts that "systems" would be shipped by the respondent "f. o. b. its factories" has had the capacity and tendency to mislead certain banks and trust companies purchasing :'systems'' from the respondent into believing that the respondent Itself manufactured and printed its own "systems" and to induce them to purchase "systems" from the respondent in such erroneous belief. . PAn. 12. At various times the respondent has represented, without ~:'{planation of the sense in which the term "promoting'' is used, that It has spent over a period of time more than $3,500,000 in promoting the Christmas Club name and idea among the banks and people of the United States, such figure representing an arbitrary fraction of the total selling expenses, other than cost of goods sold, and executive selling expenses, over a period of years, of the respondent and certain other companies the assets of which have been acquired by the respondent. Such representation without explanation of the sense in Which the word "promotion" has been used has not informed banks and trust companies as to the sense in which respondent has used the word "promotion" and has induced them to purchase "systems" ~rom respondent without knowing the sense in which the word Promotion" was used.

b PAn. 13. By the representations hereinbefore described, trade has . e?n diverted to respondent from its competitors and substantial ~llJury has been done by respondent to substantial competition in Interstate commerce. . PAn, 14. Prior to the issuance of the complaint herein, the respondent contracted to furnish "systems" to banks and trust companies Under forms of contracts, many of which were for a term of seven Conclusions 2:JF.T.C. yen,rs and provided that the bank or trust company should purchase "systems" from the respondent exclusively.

PAn. 15. Certain banks and trust companies having Euch contracts with the respondent have not, by reason thereof, purchased "systems'r from competitors of the respondent, and the effect of such contracts has been and is to substantially lessen competition or tend to create 11 monopoly in the respondent.

PAn. 16. Since June 19, 1936, and prior to the issuance of the com~ plaint herein, the respondent entered into and is carrying out con~ tracts with banks and trust companies providing that the respondent would furnish "systems'' of like grade and quality to each bank or trust company and would accept in payment therefor a percentage of the deposits made in the Christmas Club of the bank or trust com~ pany. All of such contracts did not provide for payments on the same percentage basis. However, under the terms of such contracts the bank or trust company was privileged to requisition unlimited quantities of "systems" from the respondent regardless of the rate of percentage paid by the bank or trust company or regardless of the total deposits in its Christmas Club.

PAn. 17. Under such contracts the respondent has, in the course of interstate commerce, discriminated and is still discriminating in price between different purchasers of "systems" of like grade and quality, the effect of which discriminations has been and is to substantially lessen competition or tend to create a monopoly in interstate commerce in "systems."

CONCLUSIONS 1. The aforesaid acts and practices of the respondent Christmas Club, a corporation, as described in paragraphs 8, 9, 10, 11, 12, and 13 of the foregoing findings, considered in connection with the facts set forth in paragraphs 1, 2, 3, 4, 5, 6, and 7 thereof, are to the preju· dice of the public and of respondent's competitors, and constitute unfair m.cthods 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 de~ fine its powers and duties, and for other purposes." 2. The aforesaid acts and practices of the respondent Christmas Club, a corporation, as described in paragraphs 14 and 15 of the fore~ going findings, considered in connection with the facts set forth in paragraphs 1, 2, 3, 4, 5, 6, and 7 of the foregoing findings, con· stitute a violation of the provisions of Section 3 of an Act of Con~ gross entitled "An Act to supplement existing laws against unlaw· CHRISTMAS CLUB 1127 1116 Ordet· ful restraints and monopolies, and for other purposes," approved October 15, i914.

3. The aforesaid acts and. practices of the respond.ent Christmas Club, a corporation, as described in paragraphs 16 and 17 of the foregoing find.ings, considered in connection with the facts set forth in paragraphs 1, 2, 3, 4, 5, 6, and 7 thereof, constitute a violation of the provisions of Section 2 (a) of an Act of Congress entitled "An Act to supplement existing laws against unlawful restraints and monopolies, and for other purposes," approved October 15, 1914, as amended by Section 1 of an Act of Congress entitled "An Act to amend Section 2 of the Act entitled 'An Act to supplement existing laws against unlawful restraints and. monopolies, and for other pur- Poses,' approved October 15, 1914, as amen<led (U. S. C., Title 15, Sec. 13), and for other purposes," approved June 19, 1936. ORDF..R TO CEASE AND DESIST This matter coming on to be heard. by the Commission on the complaint filed herein on February 5, 1937, and the amended answer of t~e respondent filed herein on September 28, 1937, and the Commis- Sion having made its findings as to the facts and conclusions of law; (1) that the 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"; (2) that said respondent has violated the provisions 0.f Section 3 of an Act of Congress approved October 15, 1914, entitled "An Act to supplement existing laws against unlawful restraints and monopolies, and for other purposes"; (3) that said respondent has violated the provisions of Section 2 (a) of the said Act of Congress approved October 15, 1914, entitled "An Act to supplel1lent existing laws against unlawful restraints and monopolies, and for other purposes," as amended by Section 1 of an Act of Congress entitled "An Act to amend Section 2 of the Act entitled 'An Act to supplement existing laws against unlawful restraints and monopolies, and for other purposes' approved October 15, 1914, as amend.ed (U. S. C. Title 15, Sec. 13), and for other purposes," approved June 19, 1936. . It is ordered, That respondent Christmas Club, a corporation, and lts successors, officers, agents, servants, and employees, forthwith cease and desist in connection with the business of selling or offering for sale "systems'' (as that term is defined in the aforesaid findings as to the facts) in interstate commerce and in the District of Columbia, from doing and performing any of the following acts and things: 1. Representing that it has the right to the sole and exclusive use of the name or phrase "Christmas Club" for "systems"; and repre- Order 25 F.'!'. C. senting that the name or phrase "Christmas Club" has been trademarked by the respondent for use on "systems": Provided, ho·wever, That nothing contained in this order shall prohibit the respondent from exercising its lawful right to prevent other corporations, persons, firms or partnerships from unlawfully using the name or phrase "Christmas Club" or from unlawfully using as a trade-mark, the name or phrase "Christmas Club";

2. Representing through advertisements, circulars, correspondence, stationery, or in any manner whatsoever, that it is the manufacturer and printer of "systems," unless and until it actually owns and operates, or directly and absolutely controls, a printing establishment wherein are printed any and all "systems" by it sold or offered for sale;

3. Representing that it has spent over a period of time more than $3,500,000, or any other sum, in promoting the Christmas Club name and idea among the banks and trust companies and the people of the United States, without accurately explaining the manner in which such sum has been computed;

4. Entering into contracts for the sale of "systems" or continuing to make sales of "systems" on the condition, agreement and understanding that the purchaser thereof shall not purchase or deal in the "systems" of a competitor or competitors of the respondent: Provided, lwwever, That nothing contained in this order shall prohibit the respondent from entering into contracts whereby it agrees to furnish purchasers with such "systems" as they may requisition from the respondent if such purchasers are free to purchase "systems" from competitors of the respondent;

5. Unlawfully discriminating in price as found in paragraphs 16 and 17 of the aforesaid findings as to the facts, and conclusions. Nothing contained in this order shall be construed to prevent the respondent from continuing to deal with banks or trust companies so long ns such dealings shall not violate the provisions of this onler. It is lwreby furtlwr ordered, That the said respondent shall within 90 days from the date of service upon it of this order, file with this Commission a report in writing, setting forth in detail the manner awl form in which it shall have complied with this order. DAVIS PAINT CO., INC., ET AL. 1129 Syllabus