Cliftwood Coats, Inc., and Max Shapiro

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h, THE MATTER OF CLIFTWOOD COATS, INC., AND MAX SHAPIRO COMPLAINT, FINDINGS, AND ORDERS IN REGARD TO THE ALLEGED VIOLATION OF SEC. 5 OF AN" ACT' OF CONGH.ESS APPROVED SEPT. 26 , 1914 , AND OF A ACT OF CONGRESS APPROVED OCT. 14 , 1940 Docket 5855. Compla-int, Mat. 1951-Decision, July, 1951 Where a \.-orporation and its president, engaged in the introduction into commerce and in the offer, sale and distribution therein of wool products as defined in the 'Vaol Products Labeling Act- (a) :Misbranded certain of said wool products in that they (1) were falsely and deceptively labeled "100% wool" , notwithstanding the fact they contained substantial quantities of rayon fiber; and (2) did not have affxed thereto tags or labels showing their constituent fibers and the percentages thereat as required by said act and the rules and regulations promulgated thereunder; and (b) Misbranded certain of said wool products in that (1) the interlinings were falsely and deceptively labeled as "100% wool" or as "aU wool" when they contained 100% reused wool or substantial quantities of other fibers; and (2) they similarly did not have affxed t.hereto the tags or labels supplying the aforesaid required information:

Held That such acts, practices and methods, under the circumstances set forth were in violation of sections 3 and 4 of the Wool Products Labeling Act of 1939, anu Rule 24 of the rules and regulations promulgated thereunder, and constituted unfair anll deceptive acts anel practices. Before Mr. Frank Dier trial examiner.

Mr. Jesse D. Kash for the Commission. Mr. Robert S. Olnick of New York City, for respondents. COMPLAINT Pursuant to the provisions of the Federal Trade Commission Act and the Wool Products Labeling Act of 1939, and by virtue of the authority vested in it by said acts, the Federal Trade Commission having reason to believe that Cliftwood Coats, Inc., a corporation and Max Shapiro, individually and, an offcer of said corporation have violated the provisions of said acts and the Rules and Regulations promulgated under the Wool Products Labeling Act of 1939 and it appearing to the 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: P ARAGRAI'H 1. Respondent Cliftwood Coats, Inc., is a corporation organized, existing, and doing business under and by virtue of the Decision 48 F laws of the State of ew York, with its principal place of business located at 252 ,Vest Thirty-seventh Street, New York, K. Y. Respondent Max Shapiro is president of corporate respondent and in such capacity he formulates and executes its policies and practices. His business address is the same as that of corporate respondent. PAR. 2. Subsequent to July 15 , 1941, respondents have introduced into commerce, mfmuracturecl for introduction, and offered for sale sold and -distributed in C01lllerec, as "commerce is defined in the ,Vaal Products Labeling Act of 1939 , wool pro(lucts, as "wool products:' are defined therein.

PAH 3. Certain of said wool products ele misbranded within the intent and meaning or the said act and the rules and regulations promulgated thereunder in that they were falsely and deceptively labeled 100% wool " whereas in truth and in fact ,;mid products did not contain 100 percent wool but contained substantial quantities of rayon fiber. The said "-001 products so labeled were further misbranded in that their constitutent fibers and the percentages thereof were not shown on the tags or labels thereon as require(l by said Act, in the manner and form as required by the said rules and regulations. Certain of said wool products were misbranded within the intent and meaning of the said act and rules and regulations promulgated thereunder in that the int.erlinings were falsely and deceptively labeled as 100 percent wool or as all woo!. Whereas in truth and in fact said interlinings diclnot contain 100 perce,nt wool but contained 100 percent'reused \vool or substantial quantities of other fibers. The sai(l wool prodl1cis interlinings so labeled were fUl'thermisbl'anclecl in that their constitutent fibers and the percentages thereof were not shown on the tags or labels thereon as required by said act in the manner and form as required by the said rules and regulations. PAll. 4. The aforesaid acts nnd practices and met.hods of respondents as alleged \,ere and are in violation of sections j nnd 4 of the Wool Products Labeling Act of 1939 and rule 24 of the r1118s and regulations promulgated thereunder and constitute unfair and deceptive acts and practices in c.commerce within the intent and meaning of the Fedeml Trade Commission Act.

DECISION OF THE COJ\OHSSION Pursuant to Rule XXII of the Commission s Rules of Practice, and asset forth in the Commission s "Decision of the Commission and Order to File Heport of Compliance " dated July 11, 1951, the initial decision in the instant matter of Trial Examiner Frank Ilier, as set out as fa11ows, became on that date the decision of the Commission. CLlFTWOOD COATS, INC. , ET AL.

Findings INITIAL DECISION BY FRANK BIER , TRIAL EXA)':I:!TER Pursurmt to the Provisions of the Federal Trade Commission Act and the Wool Products Labeling Act of 1939, and by virtue of the authority vested in it by said acts, the Federal Trade Commission on March 1 , 1951, issued and subsequently served its complaint in this proceeding upon the respondents Cliftwood Coats, Inc., a corporation and :Max Shapiro, individually and as an offcer of such corporation charging said respondents with the use of unfair and deceptive acts and practices in commerce in violation of those acts. On April 4 1951, respondents filed their answer to said complaint admitting all of the material allegations of fact set forth therein, but alleging that the misbranding arose through an unintentional, mnvitting and innocent mistake and requesting dismissal of the complaint on this ground. This motion for dismissal was denied by the trial examiner on April 6 1951, and proposed findings and conclusions were directed to be filed if desired, before April 17, 1951. K a proposed findings and conclusions were filed by either counsel. Thereafter, the proceeding regularly came on for final consideration by the above-named trial examiner theretofore duly designated by the Commission upon said complaint and respondents' answer thereto; and said trial examiner, having duly considered the record herein, finds that this proceeding is in the interestof the public and makes the following findings as to the facts, conclusion clra wn therefrom, and order:

FINDINGS AS TO THE FACTS P ARAGMPH 1. Respondent Cliftwood Coats, Inc., is a corporation organized, existing and doing business under and by virtue of the laws of the State of N cw York with its principal place of business located at 252 West Thirty-seventh Street, N ew York, N. Y. Respondent Max Shapiro is president of corporate respondent and in such capacity he formulates and executes its policies and practices. His business address is the same as that of corporate respondent. PAR. 2. Subsequent to July 15 , 1941, respondents have introduced into commerce, manufactured for introduction, and offered for sale sold and distributed in commerce, as "commerce" is defined in the Wool Products Labeling Act of 1939, wool products, as "wool products" are defined therein.

PAR. 3. Certain of said wool products were misbranded within the jntent and meaning of the said act and the rules and regulations promulgated thereunder in that they were falsely and deceptively labeled 100% wool " whereas in truth and in fact said prod nets did not conta;n 100 percent wool but contained substantial quantities of rayon Order 48 F. T. O. fiber. The said wool products so labeled were further misbranded in that their constituent fibers and the percentages thereof were not shown on the tags or labels thereon as required by said act, in the manner and form as required by the said rules and regulations. PAR. 4. Certain of said wool products were misbranded within the intent and meaning of the said act and rules and regulations promulgated thereunder in that the interlinings were falsely and deceptively labeled as 100 percent wool or as all wool. 'Vhereas in truth and in fact said interlinings did not contain 100 percent wool but contained 100 percent reused wool or substantial quantities of other fibers. The said wool products' interlinings so labeled were further misbranded in that their constituent fibers and the percentages thereof were not ::shown on the tags or labels thereon as required by said act in the manner and form as required by the said rules and regulations. CONCLUSION The aforesaid acts and practices and methods of respondents as found were and are in violation of sections 3 and 4 of the Wool Products Labeling Act of 1939 and Rulc 24 of the rules and regulations promulgated thereunder and constitute unfair aud dcceptive acts and practices in commerce within the intent and meau1ug of the Federal Trade Commission Act.

ORDER It i8 ordered That respondents Cliftwood Coats, Inc., a corporation, its offcers, and Max Shapiro, individually and as an offcer of said corporation, their agents, representatives and employees, directly or through any corporate or other device, in connection with the in. troduction or manufacture for introduction into commerce, or the sale transportation or distribution of wool products in commerce, as "commerce" is defined in the aforesaid acts, do forthwith cease and desist from misbranding such wool products, as defined in and subject to the Wool Products Labeling Act of 1949, which contain, or purport to contain: or in any way are represented as containing "wool reprocessed wool" or " eused wool" as those terms are defined in said act:

1. By falsely or deceptively stamping, tagging, labeling, or otherwise identifying such products;

2. By failing to securely affx to or place on such products a stamp, tag, label, or other means of identification showing in a clear and conspicuous manner:

(a) The percentage of the total fiber weight of such wool products, exclusive of ornamentation not exceeding 5 percent of said total fiber CLIF'rWOOD COATS, INC., ET AL.

Order weight of (1) wool, (2) reprocessed wool, (3) reused wool, (4) each fiber other than wool where said percentage by weight of such fiber is 5 percent or more and (5) the aggregate of all other fibers; (b) The maximum percentage of the total weight of such wool product of any nonfibrous loading, filling or adulterating matter; (e) The name or the registered identification number of the manufacturer of such wool product or of one or more persons engaged in introducing such wool product into commerce, or in the offering for sale, sale, transportation, or distribution thereof in commerce, as com merce" is defined in the Federal Trade Commission Act and in the Wool Products Labeling Act of 1939;

Provided That the foregoing provisions concerning misbranding shall not be construed to prohibit acts permitted by paragraphs (a) and (b) of section 3 of the Wool Products Labeling Act of 1939; and Provided further That nothing contained in this order shall be construed as limiting any applicable provisions of said act or the rules and regulations promulgated thereunder.

ORDER TO FILE REPORT OF COMPLIANCE It i8 ordered That the respondents herein shall, within 60 days after service upon them of this order, file with the Commission a report in writing setting forth in detail the manner and form in which they have complied with the order to cease and desist (as required by said declaratory decision and order of July 11, 1951J.

FEDERAL TRADE CO:\ISSION DECISIONS Complaint 48 F. T. C.