Rockford Furniture Factories, Inc

Text (OCR of the scan at left; may contain errors)

IN THE MA.'ITER OF ROCKFORD FURNITURE FACTORIES, INC.

COMPLAINT, FINDINGS, AND ORDER IN REGARD TO THE ALLEGED VIOLATION OF SEC. 5 OF AN ACT OF CONGRESS APPROVED SEPT. 26, 1914 Docket ~503. Complaint, May 14, 1941-Decision, .Aug. 1!7 1941 Where a corporation, with otnce and principal place of. business in Newark, N. J., engaged in interstate sale and distribution of. furniture at retail- Represented, directly or Indirectly, that it was a manufacturer of. furniture and owned, operated, or controlled the plants or factories in which the furniture dealt in by it was made, and that such furniture was manufactured in Rockford, Ill., through adoption and use of corporate name includ· lng words "Rockford Furniture Factories," and through designatlng as "Rockford Furniture Showrooms" building and rooms in which ita said furniture was displayed, and featuring its said corporate name on letterheads, sales contracts and other printed and advertising matter, and its said latter, designation about the building and rooms in question, and printing the same on order blanks, code price cards, and other llterature used in connection with the display, solicitation, and sale of its furniture; Notwithstanding it was not a manufacturer of furniture, but purchased it on the open market, and stocked and sold very little, if any, furniture made exclusively In Rockford, Ill.;

With effect of misleading and deceiving a substantial portion of the purchasln~t public into the erroneous belief (1) that it was a manufacturer, for dealing with whom directly, there is a marked prl'ference, due to the belief that the profit of the middleman may be thereby eliminated and lower prices, more favorable terms, and other advantages obtained, and (2) that its said furniture was made In Rockford, Ill., long known as an important part of the furniture Industry, products of which bad long enjoyed a widespread popularity and demand; and of inducing a substantial portion of the purchasing public to buy its furniture as a result of such mistaken belief: lleld, That such acts and practices, under the circumstances set forth, were all to the prejudice and Injury of the public, and constituted unfair and deceptive acts and practices In commerce.

Mr. J. V~ Buffington for the Commission.

-Mr. Samuels. Ferster, of Newark, N.J., for respondent. COMPLAINT 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 Rockford Furniture Factories, Inc., a corporation, hereinafter referred to as respondent, has violated the provisions of said act, and it appearing to the Com· mission that a proceeding by it in respect thereof would be in the 972 FEDERAL· TRADE COMMISSION DECISIONS Complaint 33F.T.C.

public interest, hereby issues its complaint, stating its charges in that respect as follows :

PARAGRAPH 1. The respondent, Rockford Furniture Factories, Inc., is a corporation organized, existing, and doing business under and by virtue of the laws of the State of New Jersey, with its office and principal place of business located at soi Passaic A venue in the city of Newark and State of New Jersey. The respondent for mora than three years· last past has been, and is now, engaged in the distribution and sale at retail of furniture.

Respondent causes its said furniture, when sold, to be transported from its place of business in the State of New Jersey to the purchasers thereof located in various 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 furniture in commerce among and between the various States of the United States and in the pistrict of Columbia.

PAR. 2. In the course and conduct of its aforesaid business, the respondent adopted as and for its corporate and trade name the words "Rockford Furniture Factories, Inc.," under which to carry on its business, which said name, including the words "Rockford" and "Factories," respondent at all times mentioned herein has used continuously, and now uses, in soliciting the sale of ·and selling its furniture as described herein. Respondent has also described and designated, and now describes and designates, the building and rooms in which its said furniture is displayed as "Rockford Furniture Showrooms." Respondent has caused, and still causes, said corporate or trade name, "Rockford Furniture Factorie~, Inc.," to be prominently nnd conspicuously displayed in and about its place of business and to appear on its letterheads, sales contracts and other printed and advertising matter distributed in commerce among and between the various States of the United States and in the District of Columbia, and has caused, and still causes, the said designation, "Rockford Furniture Showrooms," to prominently appear in and about the building and rooms in which its furniture is displayed and to be imprinted on its order blanks, code price cards and other literature used in connection with the display, solicitation oi sales and selling of said furniture.

PAR. 3. Through the use of the aforesaid corporate or trade name, "Rockford Furniture Factories, Inc.," and said designation, "Rockford Furniture Showrooms," and through other representations not specifically set out herein, the respondent has represented, and still represents, directly or indirectly, that it is a manufacturer of furni- ROCKFORD FURNlTURE F1ACTORIES, INC. 973 971 Complaint ture; that it owns and operates or controls the manufacturing plants or factories in which the furniture it sells is manufactured; and that said furniture is manufactured in the city of Rockford, Ill. PAR. 4. Such representations on the part of the respondent are· false and misleading. In truth and in fact, respondent has never been, and is not now, a manufacturer of furniture. It has neverr and does not now, own and operate or control in any manner the manufacturing plants or factories in which such furniture, or any of it is manufactured. Respondent at all times mentioned herein, on the contrary, has purchased, and now purchases, all of its furniture on the open market. Respondent has never and does not now stock or sell furniture manufactured exclusively in the city of Rockford, Ill., but on the contrary, has stocked and sold, and now stocks and sells, very little, if any, furniture manufactured in said city. PAn. 5. There is a marked preference on the part of a substantial portion of the purchasing public for purchasing furniture and other merchandise directly from the manufacturer thereof, such preference being due in part to a belief on the part of the public that the profit of a middleman may be eliminated and that lower prices, more favor- • able terms and other advantages may be obtained thereby. PAR. 6. The city of Rockford, Ill., has been for many years last past, and is now, a large and important center of the furniture industry, which fact has been, and is, generally known to a substantial portion of the public throughout the United States. The furniture manufactured in said city for many years has enjoyed, and now enjoys, a widespread popularity and demand and there is a preference on the part of a substantial portion of the purchasing public for such furniture.

PAn. 7. The use by the re~pondent of th'3 acts and practices herein set forth has had, and now has, the tend.ency and capacity to, and does, mislead and deceiye a substantial portion of the purchasing public into an erroneous and 1mistaken belief that respondent is a manufacturer of the furniture it sells and that said furniture is manufactured in Rockford, Ill., and h:.ts had, and now has, the tendency and capacity to, and does, induce such portion of the public to purchase substantial quantities of said furniture as the result of such erroneous and mistaken belief.

PAR. 8. The aforesaid acts and practices of the respondent as herein alleged are all to the prejudice and injury of the public and constitute unfair and deceptive acts and practices in commerce within the intent and meaning of the Federal Trade Commission Act. 435526m--42--vol.33----62 Findings 33F.T.<;J. REPORT, FINDINGS AS TO THE FACTS, AND ORDER Pursuant to the provisions of the Federal Trade Commission Act, the Federal Trade Commission on May 14, 1941, issued and on May 15, 1941, served its complaint in this proceeding upon respondent Rockford Furniture Factories, Inc., a corporation, charging it with the use of unfair and deceptive acts and practices in commerce in violation of the provisions of said act. On June 4, 1941, the respondent filed its answer, in which answer it admitted all the material allegations of fact set forth in said complaint and waived all intervening procedure and further hearing as to said facts. Thereafter, the proceeding regularly came on for final hearing before the Commission on the said complaint and the answer thereto, and the Commission having duly considered the matter 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, Rockford Furniture Factories, Inc., is a corporation organized, existing, and doing business under and by · virtue of the laws of the State of New Jersey, with its office and principal place of business located at 801 Passaic A venue in the city of Newark and State of New Jersey. The respondent for more than 3 years last past has been, and is now, engaged in the sale at retail and distribution of furniture.

Respondent causes its said furniture, when sold, to be transported from its place of business in the State of New Jersey to the purchasers thereof located in various 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 furniture in commerce among and between the various States of the United States and in the District of Columbia. · PAR. 2. In the course and conduct of its aforesaid business, the respondent adopted as and for its corporate and trade name the words "Rockford Furniture Factories, Inc," under which to carry on its business, which said name, including the words "Rockford" and "Factories," respondent at all times mentioned herein has used ~on- ' tinuously, and now uses, in soliciting the sale of and selling its furniture as described herein. Respondent has also described and des- , ignated, and now describes and designates, the building and room~ in which its said furniture is displayed as "Rockford Furniture Show- ROCKFORD FURNITURE FACTORIES, INC. 975 Findings rooms." Respondent has caused, and still causes, said corporate or ~trade name, "Rockford Furniture Factories, Inc." to be prominently and conspicuously displayed in and about its place of business and to appear on its letterheads, sales contracts, and other printed and Sl,dvertising mutter distributed in commerce among and between the various States of the United States and in the District of Columbia, and has caused, and still causes, the said designation, "Rockford Furniture Showrooms," to prominently appear in and about the building and rooms in which its furniture is displayed and to be imprinted on· its order blanks, code price cards and other literature used in connection with the display, solicitation of sales and selling of said furniture.

PAR. 3. Through the use of the aforesaid corporate or trade name, "Rockford Furniture Factories, Inc." and said designation, "Rockford Furniture Showrooms," and other representations not specifically set out herein, the respondent has represented, and still represents, directly or indirectly, that it is a manufacturer of furniture; that 1t owns, operates, or controls the manufacturing plants or factories in which the furniture it has sold, and now sells, was and is manufactured; and that said furniture is manufactured in the city of Rockford, Ill. . PAR. 4. Such representations on the part of the respondent are false and misleading. In truth and in fact, respondent has never been, and is not now, a manufacturer of :furniture. It has never, and does not now, own, operate, or control in any manner the manufacturing plants or :factories in which such :furniture, or any of it, was and is manufactured. Respondent at all times mentioned herein, on the contrary, has purchased, and now purchases, all of its furniture on the open market. Respondent has never and does not now stock or sell furniture manufactured exclusively in the city of Rockford, Ill., but, on the contrary, has stocked and sold, and now stocks and sells, very little, if any, :furniture manufactured in said city. PAR. 5. There is a marked preference on the part of a substantial portion of the purchasing public for purchasing furniture and other merchandise directly from the manufacturer thereof, such preference being partly due in part to a belief on the part of the public that the profit of a middleman may be eliminated and that lower prices, more favorable terms and other advantages may be obtained thereby. PAR. 6. The city of Rockford, Ill., has been for many years last past, and is now, a large and important center of the furniture industry, which fact has been, and is, generally known to a substantial portion of the public throughout the United States. The Order 33F.T.C.

furniture manufactured in said city for many years has enjoyed, and now enjoys, a widespread popularity and demand, and there is a preference on the part of a substantial portion of the purchasing public for such furniture.

PAR. 7. The use by the respondent of the acts and practices herein set forth has had, and now has, the tendency and capacity to, and does, mislead and deceive a substantial portion of the purchasing public into an erroneous and mistaken belief that respondent is a manufacturer of the furniture it sells and that said furniture is manufactured in Rockford, Ill., and has had, and now has, the tendency and capacity to, and does, induce such portion of the public to purchase substantial quantities of said furniture as the result of such erroneous and mistaken belief.

CONCLUSION The aforesaid acts and practices of the respondent, as herein found, are all to the prejudice and injury of the public and constitute 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 been 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 allegations of fact set forth in said complaint and states that it waives all intervening procedure and further hearing as to said facts; and the Commission having made its .findings as to the facts and its conclusion that said respondent has violated the provisions of the Federal Trade Commission Act.

It is ordered, That the respondent Rockford Furniture Factories, Inc., a corporation, its officers, representatives, agents, and employees, directly or through any corporate or other device, in connection with the offering for sale, sale, and distribution of furniture in commerce, as "commerce" is defined in the Federal Trade Commission Act, do forthwith cease and desist from:

1. Using the word "Rockford," or any simulation thereof, in its corporate name, or in any way to designate or refer to its business or its display rooms, when the furniture offered for sale and sold by respondent is not in substantial proportion manufactured in the city of Rockford, Ill.

2. Using the word "Rockford," or any simulation thereof, on its letterheads, posters, advertising materials, or in any manner to repre- ROCKFORD FURNITURE FACTORIES, INC. 977 Order sent, import, or imply that furniture not manufactured in the city of Rockford, Ill., was manufactured in that city. 3. Using the word "Factories," or any other word or terms of similar import or meaning, in its corporate name, or to designate or refer to its business or in any manner represent, import, or imply that respondent is the manufacturer of furniture offered for sale or sold by it.

It is further ordered, That resp.ondent 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 this order.

Complaint 33F. T. C.