Rose R. Scott

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IN THE MATTER OF ROSER. SCOTT, TRADING AS KOSKOTT COMPANY COMPLAINT, FINDINGS, AND ORDER IN REGARD TO THE ALLEGED VIOLATIO~ OF SEC, fi OF AN ACT OF CONGRESS APPROVED SEPT. 26, 1914 Docket 3515. Complaint, Sept. 3, 1.938-Decis·ion, Feb. 6, 1939 Where an individual engaged in sale and distribution of a line of hair prepara· tlons which were made for her and designated by numbers, and known as "Koskott" line; in advertising her said various· preparations in magazines and newspapers of general circulation throughout the United States- (a) Represented, directly or by implication, that said products were effectl've cures for thin and falling hair, and that they constituted competent cures for ringworm, barbers' itch, pimples, eczema, and scalp disorders; and {b) Represented that they constituted competent cures for baldness, and that they would grow hair, and that growth could be expected to begin wttbin a few days after use thereof, and that they were scientific remedies wbicb stimulated the blood circulation and afforded nutrition to the hair roots, and that latter were rejuvenated and so affected as to cause hair to gro\f therefrom, and that preparation would impart a natural shade and color to the hair and succeed where other products failed ; ·Facts being said products were not effective cures for thin or falling hair, use thereof would not prevent same from falling out or being brushed or combed from the heud, they were not competent cures for cause of dandruff or various other ailments and conditions set out, and would not accomplish above results claimed therefor, and did not stimulate blood circulation, etc., and would not succeed where others failed;

With tendency and capacity to mislead and deceive substantial portion of pur· chasing public into erroneous belief that such false and misleading repre· sentations were true, and with result, as direct consequence of such mistaken and erroneous belief induced by such advertising and representations, that number of the purchasing public bought substantial quantity of her said products and trade was unfairly diverted to her from others likewise engaged in sale of preparations for the head and hair, and who truthfully . represent their products :

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

Defore },fr. Jolvn J. /{eenan, trial examiner. },fr. Oharles S. Oow for the Commission.

Mr. J. Bond Smith, of 'Vashington, D. C., for respondent. CO~IPLAINT Pursuant to the provisions of the Federal Trade Commission Act, and by virtue of the authority vested in it by said act, the Federal Trade Commission, having reason to believe that Rose R. Scott, trad· KOSKOTT CO, 315 Complaint i~g as Koskott Company, hereinafter referred to as respondent, has VIolated the provisions of the said act, and it appearing to the Comlhission 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. Respondent, Rose R. Scott, is an individual trading :tnd doing business as Koskott Co., with her office and principal place Qt bu~iness at 223 West Thirty-third Street, New York, N.Y. ] PAR. 2. Respondent is now and for more than 10 years last past /a~ been engaged in the business of distributing and selling a line of lair preparations known as "Koslwtt." Respondent causes said prodl~cts when sold to be transported from her place of business in the State of New York to customers located in other States of the United States and in the District of Columbia.

,Respondent maintains, and at all times mentioned herein has maintained, a course of trade in said hair preparations in commerce between and among the various States of the United States and in the District {)f Columbia.

PAR. 3. In the course and conduct of her business, respondent is in active and substantial competition with other individuals and with <!Orporations, firms, and partnerships engaged in the sale and distribution of hair preparations in commerce bet"·een and among the various States of the United States and in the District of Columbia. PAn. 4. In the course and conduct of said business and for the fJUrpose of inducing the purchase of said hair preparation's, respondent, ~y means of advertising circulars and folders, and by means of adverhsements inserted in magazines and newspapers, circulated generally throughout the United States, has made many representations con- ~erning the character and nature of said hair preparations !:lnd con- ~~lning the results obtainable from their use. Among said representations made by respondent are the following: 1 AU of said statements, together with similar statements and advertising literature, purport to be descriptive of respondent's products and of their effectiveness in use. In all of her advertising literature and through other means, respondent directly or by inference, through statements nnd representations herein set out and other statements of Situilar import and effect, represents that said preparations are effective cures for thin or falling hair, and that the use thereof will prevent hair from falling out or being brushed or combed from the head; that 1 The quoted matter set forth at length In the complaint at this point, In which respond· ent purports to describe the qualities and efl'ectlveness of her said preparations, Is also set forth In the findings, Infra, at page 318, and for that rea•on Is here omitted In the Interest i>f hre\'lty.

200346'"-40-vol. 28-23 Complaint 2SF.T.C· said preparations are competent cures for the cause of dandruff; that said preparations are competent cures for ringworm, barbers' itch, pimples, eczema, and scalp disorders; that said preparations are coJll~ petent cures for baldness; that said preparations will grow hair; and that the growth of the hair can be expected to begin a few days af~er using said preparations; that said preparations are scientific remedy1es and will stimulate the blood circulation, and afford nutrition to the hair roots; that by using said preparations the hair roots are rejuvenated and so affected as to cause hair to grow therefrom; that the ~se of said preparations will impart a natural shade and color to haifj and that respondent's preparations succeed where others fail. PAR. 5. The representations made by respondent with respect to the nature and effect of her products when used are grossly exaggerated, and untrue. In truth and in fact, respondent's preparations are not effective cures for thin or falling hair and the use of the same will not prevent hair from falling out. or being brushed or combed from the head. Said preparations are not competent cures for the cause of dandruff. Said preparations are not competent cures for ringworm, barbers' itch, pimples; eczema, and scalp disorders. Said preparations are not competent cures for baldness, will not grow hair and the u~ of the same will not increase the length of the hair. Users of said preparations cannot procure a growth of hair within a few days or any other period of time from the use of said preparations. By using said preparations the blood circulation is not so stimulated as to afford nutrition to the hair roots. By using said preparations the hair roots are not rejuvenated and so affected as to cause hair to gro"' therefrom.· Said preparations will not impart a natural shade and color to the hair. Respondent's preparations do not succeed where others fail.

PAR. 6. There are among respondent's competitors many who dis· tribute and sell hair preparations who do not in any way misrepre· sent the quality or character of their respective products or their effectiveness when used.

PAR. 7. Each and all of the false and misleading statements and representations made hy respondent in describing her hair products and their effectiveness when used, as hereinabove set out, were and are calculated to, and have had, and now have, a tendency and capacity to misleau and deceive a substantial portion of the purchasing public into the erroneous belief that all of said representations are true. }..s a direct result of this erroneous and mistaken belief, a number of the consuming public have purchased a substantial volume of respondent's products with the result that trade has been diverted unfairly to t·respondent from competitors who are engaged in the business of dis~ IWSKOTT CO. 317 314 Findings tributing and selling hair preparations, and who truthfully advertise and represent their respective products and the effectiveness thereof When used. As a consequence thereof, injury has been done, and is now being done, by respondent to competition in commerce among and between the various States of the United States and in the District of Columbia.

PAR, 8. The aforesaid acts and practices of respondent as herein alleged are all to the prejudice of the public and of respondent's comfletitors, and constitute unfair methods of competition and unfair and ?eceptive acts and practices in commerce within the intent and meanlng of the Federal Trade Commission Act.

REPORT, FINDINGS As TO THE Facts, AND 0ImER Pursuant to the provisions of the Federal Trade Commission Acti the Federal Trade Commission, on September 3, 1938, issued and sen·ed its complaint, in this proceeding upon the respondent, RoseR. Scott, trading as Koskott Co., charging her with the use of unfair :methods of competition in commerce and unfair and deceptive acts and practices in commerce in violation of said act. After issuance of said complaint, the respondent filed her answer thert>to, admitting all the material allegations of fact set forth in said co111plaint al)d waiving hearing and all intervening procedure. Thereafter, the proceedings regularly came on for final hearing before the Commission on the said complaint and the answer thereto, and the Commission, having duly considered the same and being now fully advis£>d 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 dra "\Vn therefrom.

FINDINGS AS TO THE FACTS PARAGRAPH 1. The respondent, RoseR. Scott, is an individual trading and doing business as Koskott Co., with her office and principal place of business at 223 'Vest Thirty-third Street, New York, N. Y. Respondent is now, and for more than 10 years last past has been, engaged in the business of selling and distributing a line of hair preparations 'known as "Koskott" preparations, designated by numbers, all of which are manufactured for respondent, are sold and shipped by her to purchasers in States other than the State in which respondent's Place of business is located and from which said shipments are made. !n the course and conduct of her business, respondent has been and ls presently in competition with other individuals, partnerships and Corporations engaged in the sale and distribution of like or similar 318 FEDERAL TRADE COMl\IISSION DECISIONS Findings 28F. T.O.

products in commerce between and among the various States of the United States and the District of Columbia. PAR. 2. In the course and conduct of her said business, respondent, in the sale of her various preparations and in inducing the public to purchase said preparations, has, by means of various advertising cir· culars and folders, and by means of advertisements inserted in maga· zines and newspapers circulated generally throughout the United States, made statements and representations concerning the char· acter and nature of said preparations and concerning the results ob· tained from their use. Among the said representations made by the respondent are the following :

SOME OF THE HIRSUTAL COI\"DITIONS WHEREIN KOSKOTT l\IETHOP HAS PROVED HIGHLY El!'FECTIVE.

Falling Out, or Combing Out of Hair.

Dandruff, otherwise known as spborrhea or scurf. A diiieased condition of tbe :sculp which must be remedied or all hair will be lost. Hair Brushing Out. It sticks to the brush Instead of remaining fast to tbe :scalp, thereby proving the absolute need of prompt attention to save it. Hair Falling in Patches. (Alopecia Areata.) Hair Turning Gray-or already gray, or white. Should be dai·kened gradnall1 to nutural shade of youth • • •.

Thin Hair on Upper Lip, or no hair at all where a good mustache is desired. Ringworm, Barbers' Itch, l.ittle Pimples and other scalp disorders. Baldness. In one large spot or in several places. Hair Disappearing Mysteriously.

The above troubles are some of the most common conditions in which tbB Koskott Method is asserting its real merit . • • • • • • • Lovely llnir Growth. • • • Tbls famous preparation • • • has often started hair growth in a few days .

.. • • • • • • Use Koskott To Grow Hair. Overcome Baldness. Eliminate Dandruff. Stop the Falling Out of Hair. Make the Hair Grow Long, Thick and Lustrous. KOSKOTT IS A SCIE~TIFIC SUCCESSFUL REMEDY We recommend Koskott for the hair, because it • • • contains the right Ingredients • • • to stimulate the direct blood nutrition of the hair, roots in their follicles. • • "" it is exactly fnited according to the best authorities and latest scientific trials, to eradicate dandruff, overcome the germs of ball· ness and promote all possible growth of new hail' where such a result iS therupentlcally possible. • • • Resenrch bus ren•nled the cnn8e of dandruff. t•tc., and the ~ume light of knowlPtlgP bus m:tde possihlP the prPparution, of tbo proper remNly. Koskott Is gunrnute<'d to remove the RJJOres jn~t de!<erilwd. • • • Tlte pharmacopein has bt•en literally run~neked In Ko;;kott Labora· tory's successful seurch for a group of Ingredients with the power to rrnct thronJrh the sculp upon the blood circulation which feeds the hair follicle~. Such Is the fonnulu for Koskott. That is why It "makes good'' in so large a KOSKOTT CO. 319 Findings :Percentage of cases. • • • Koskott tends to make the hair grow longer and lnore pll'ntiful, or to promote hair growth where there has been bald· ~ess • • •. Koskott is aimed • • • to remedy the subnormal state lllSlde by waking up the cells and tissues to renewed life. The arousing takes Place because tlic therapeutical properties of Koskott consist of stirring up the t'lrcUlation of the blood as the application is rubbed ln. The circulation being thus restored, the hair roots In the scalp should be so revivified as to push 1?rth new hair growth. The follicles also gain strength to throw off any para- Sites that may nestle into the glands around the hair roots. • • • • * • • Dandruff, Thin or Splitting Hairs, Falling Hairs, Ordinary Baldness, need 1\o~kott Nos. 1, 2, and 3.

Da!dness in Patches, Ringworm, Barbers' Itch, Eczema on Scalp, require 1\oskott Nos. 2, 3, and 5 • • •.

• • • Your Hair Will Grow Again! •• • • • • • • Why Others Fail and Koskott Succ!'eds. • • • • • • • 1\oskott No. 1 is the hair stimulator or feeder which gi\"I'S timely aid to the hair shaft when It is visible above the scalp. • • • Koskott Method if! effi.~aclot1S In many ca~es where all else has failed. 1\oskott to Encourage Hair Growth.

• • • This famous preparation is for dandruff, thinning hair, and hail" loss preceding s~>veral forms of baldness • • •. PAR. 3. The said statements, together with similar statements and :epresentations, serve as representations to members of the purchaslng public as properly descriptive of respondent's products and of their effectiveness in use. The use of such statements misleads members of the purchasing public into the erroneous and mistaken belief that respondent's products are effective cures for thin and falling hair; that the use thereof will prevent hair from falling out or being brushed or combed from the head; that said preparations are competent cures for the cause of dandruff; that said preparations are eompetent cures for ringworm, barbers' itch, pimples, eczema, and Scalp disorders; are competent cures for baldness; will grow hair; that the growth of hair can be expected to begin a few days after llsing said preparations; that said preparations are scientific remedies an<] will stimulate the blood circulation, and afford nutrition to the hair roots; that the hair roots are rejuvenated and so affected as to cause hair to grow therefrom; said preparation will impart a natural shade and color to the hair; and will succeed where other preparations fail.

PAR. 4. The representations made by the respondent with respect to the nature and effect of the products when used are false and misleading in that respondent's preparations are not effective cures for thin or falling hair and the use of same will not prevent hair from Order 28F.T.C.

falling out or being brushed or combed from the head. Said prepa· rations are not competent cures for the cause of dandruff. Said preparations are not competent cures for ringworm, barbers' itch, pimples, eczema, and scalp disorders. Said preparations are not competent cures for baldness, will not grow hair on bald heads, and the use of same will not increase the length of the hair. Users of ~aid preparations cannot procure a growth of hair within a few days of its use or any other period of time from the use of said prepnra· tions. By using said preparations the blood circulation is not so stimulated as to afford nutrition to the hair roots. By using the said preparations the hair roots are not rejuvenated and so affected as to cause hair to grow therefrom. Said preparations will not im· part a natural shade and color to the hair. Said preparations will _not succeed where others fail.

PAR. 5. Each and all of the f<llse, misleading, and untrue representations made by respondent in offering for sale and selling her prod· nets were and are calculated to, and had and now have, a tendency und capacity to mislead and deceiye a substantial portion of the purchasing public into the erroneous belief that said representations ore true. .Further, as a direct consequence of such mistaken and £•rroneous belief, induced by the advertising and representations of the respondent, as aforesaid, a number of the purchasing public ha1'e purchased a substantial quantity of said products, with the result that trade has been unfairly diverted from other corporations, indi· viduals, firms, and partnerships likewise pngaged in the sale of prepa· rations for the head and hair who truthfully advertise their products. CONCLUSION The aforesaid acts, representations, and practices of the respondent, Rose R. Scott, trading as Koskott Co., as herein found, luwe been and are to the prejudice and injury of the public and of respondent's competitors, and constitute unfair methods of competition in com· merce and unfair and deceptive acts and practices in commerce within the intent and meaning of the Federal Trade Commission Act. ORDER TO CEASE AND DESIST This proceeding having b!'oen heard by the Federal Trade Commission upon the complaint of the Commission and the answer of respondent, in which answer respondent admits all the material alle· gations of fact set forth in said complaint and states that she wai,·es all intervening procedure and further hearings as to said facts, and the Commission having made its findings as to the facts and con· KOSKOTT CO. 321 Order ~usion that said respondent has violated the provisions of the ederal Trade Commission Act, It is ordered, That the respondent, RoseR. Scott, individually and trading as Koskott Co., or trading under any other name, her agents, . servants, representatives, and employees, directly or through any corporate or other device, do forthwith cease and desist from: b Disseminating, or causing to be disseminated, any advertisement . Y means of the United States mails or in commerce, as commerce ls defined in the Federal Trade Commission Act, by any means, for ~he purpose of inducing or which is likely to induce, directly or lndirectly, the purchase of any of her cosmetic preparations now designated by the name Koskott, or any other cosmetic preparations c?mposed of substantially similar ingredients or possessing substantially similar therap£>ut.ic properties, whether sold lmder that name or under any other name, or disseminating or causing to be disseminated any advertisement by any means for the puq)ose of inducing or which is likely to induce, directly or indirectly, the purchase in commerce, as commerce is defined in the Federal Trade Commission .A.ct, of said preparations, which advertisements, represent, directly or by implication, that said preparations will stop falling hair or Prevent baldness, or will grow hair or have any effect on the growth of hair; that said preparations constitute a remedy or cure for ' d~ndruff, pimples, eczema, barbers' itch or ringworm, or other scalp disorders, or a competent or effective treatment for any of said con- • ditions; that said preparations are of the highest medical, pharmaceutical or scientific efficiency; that said preparations will rejuvenate the hair roots or will stimulate the circulation, or will have any substantial beneficial effect on either hair roots. or circulation; or that said preparations will impart a natural shade or color to the hair or will act in any manner other than as a hair dye. It i8 further ordered, That the respondent shall, within 60 days .after service upon her of this order, file with the Commission a report in writing, setting forth in detail the manner and form in which she has complied with this order.

Syllabus 28F. r.r.C.