Ar. Winarick, Inc.

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IN THE MATTER OF AR. WINARICK, INC., ET AL.

DECISION , A)fD DISSENTI)fG OPINION IN RJ,GARD TO Tile ALLEGED VIOLATION OF TI-IE FEDERAL TRADE COMMISSION ACT Docket (;0;32. Complaint, Nov. 1952 Dec-ision, Mar', 10 , 195.1 Where a corporation and its three offcers, engaged in the competitive interstate , for use in addition to its cos- sale of their "Jeris Antiseptic Hair Tonic metic purposes, in the treatment and prevention of hair and scalp diseases and of an after-shave lotion called "Fore; in advertising their saiu "Hair Tonic" in magazines- (a) Falsely represented that tbe use of said tonic with massage would help promote hair growth and prevent excessive fallng hair, througb such statements as "helps promote healthy hair growth" and " relieves excessive falling bail''' ; and (b) Falsely represented that barbers, by reason of their training, arc capable of diagnosing and treating diseased conditions of the bail' and scalp through on your such statements as "For bail' and scalp care you can depend Barber s recommendation! Your barber is trained in hair and scalp care and qualified to advise you. So if you happen to be tronbled with dandruff falling hair or SOlne other hair problcln, as so many Inen arc, remclllber to consult your unrbel' Held That sucb representations constituted false advertisements 'Witbin the meaning' of Sec. 12, and that use thereof constituted unfair and deceptive acts and practices in commerce.

Before Mr. ,T. Earl Oox hearing examiner. Mr. J. W. Brookfield, Jr. for the Commission. Mr. Lewis G. Berntein of New York City, for respondents. DECISION OF THE CO::\IMISSION STATE1\IEXT OF Tile CASE The Federal Trade Commission on August 18, 1952, issued a complaint and on November 12, 19;)2, issued an amended complaint charging respondent AI'. vVinarick, Inc., and three of its offcers, Jules Winarick, Nathan vVinarick and Floyd H. Pepper, with having violated the Federal Trade Commission Act by disseminating false advertisements in connection with the sale of their products " J cris A ntiscptic Hair Tonic" and "Fore " an after shave lotion. Heopondents filed an answer denying that their advertisements were in violation of law. Pursuant to notice, hearings were held in X ew York City on January 5 and 6 and February 10, 1953, before.T. Em-I Cox, a hearing examiner 1 Amended.

Findings 50 F. T. C.

designated by the Commission to hear this proceeding. Full opportunity to be heard, to examine and cross-examine witnesses, and to introduco evidence bearing on the issues was afforded respondents and counsel supporting the complaint. All testimony and other evidence was recorded and filed in the office of the Commission. After receiving proposed findings of fact, the hearing examiner fied this initial decision on May 21, 1953, in which he conchlded that respondents had violated the Federal Trade Commission Act by falsely advertising that a bottle of after shave lotion is given free where, in fact, it was given only on the purchase of a bottle of hair tonic and by advertising that barbers are capable of diagnosing and treating diseased conditions of the hair and scalp. lie dismissed the other allegations of the complaint which charged respondents with falsely representing that the use of their hair tonic will cure dandruff, relieve itchy scalp, prevent excessive falling hair, promote hair growtll and resnli in a healthy scalp.

Thereafter, coumel supporting the complaint appealed to the Commission from his initial decision. Respondents filed a brief in opposition to this appeal in which they request the Commission to dismiss all of the allegations of the complaint. By agreement of counsel, this appeal was submitted to the Commission for decision without oral argument.

Upon consideration of the entire record herein, the Commission has determined that the rulings of the hearing examiner made at the hearings are free of prejudicial error, and makes the following: FIXDJXGS OF FACT 1. Business f The Respondents Respondent AI' Winarick, Inc., is anew Yorkcorporation having its principal place of business at 805 East 140th Street, K ew York, X ew York. Respondents ,Jules vVinarick, N flthan \Vinflrick, :md Floyd H. Pepper, individuals, arc offcers of AI'. vVinflrick, Inc., who directed flnd controlled its policies with respect to the advertising herein set out. Respondents sell "Jeris Antiseptic Hair Tonic " and an after shave lotion called "Fore" to purchasers located in various States of the United States other than New York, and during the period of time involved herein have regularly caused these products, when sold, to be shipped from their plflee of business in the State of New York to these pUj':hasers, in interstflte eornmerce. They are now, and during the period of time involved herein, have been in suhst:mtial competition with others engaged in the sale of other hair tonic:s and after shflve preparations.

. . . . .

AR. WINARICK, INC., ET AL. 793 791 Findings The active ingredients of Jeris Antiseptic Hair Tonic are shown by the label to be:

8- Hydroxyquinoline Resorcinol Monoacetate Tincture of Capsicum Fixed and Volatile Oils Ethyl-alcohol.

The directions for use are as follows: "Brush or massage the scalp to remove any dus1 or foreign slibstance. Apply Jeris freely, massaging the scalp briskly with fingertips. This treatment will assure you a clean scalp, lustrous hair, free from loose dandruff. II. The Advertisements In the course of their business respondents have placed advertisements containing the following excerpts in magazines which were disseminated throughout the States of the United States. The Truth About Dandruff. . . Itchy Scalp. . . J;'along Hair IT' S A FACT DANDRUFF is often caused by neglect. . .

by improper care of hair and scalp. . . THE HAIR itseif cannot grow. Growth comes from the root.

. HBLP THE ROOT and you help tbe hair.

JERIS GETS AT 'rhe ROOT OF THE TROUBLE Jcris Antiseptic Hair Tonic contains a special ingredient not found in ordinary hair tonics. It acts to stimuiate blood flow which nonrishes the roots. Thus, Jeris not only relieves dandruff, iteby scalp and dresses your hair handsomely . . . but it heips promote healthy hair growth. . . . (Life Magazine, 1948) KEEP HAIR WELL-GROOMED Free of Dandruff Too (1) JERIS KILLS DANDRUFF GERMS. on contact! antiseptic action instantly removes unsightly daudruff flakes.

(2) .JBHIS STIMULATES THE SCALP! Daily massage with J eris a wakens blood flow. Helps promote healthy hair growth, relieve dry scalp and excess fallng hair.

. (Pityrosporum ovale), which many authorities recognize as the cause of infectious dandruff. (Saturday Evening Post, 1948) 794 FEDERAL TRADE COMMISSION DECISIOKS Findings 50 F.

Scalp-stimulation: Daily JERIS massage helps promote bealtby hair growth, relieves dry scalp, excessive fallng bail'.

(Saturday Evening P\st, 1952) Respondents have made representations similar to the last quote above in their recent radio and newspaper advertisements in addition to their magazine advertising.

also con- Respondents' 19'52 Saturday Evening Post advertising pity-rosporum ovale, andtained claims of kiling dandruff germs, same form as quotedremoving dandruff flakes in substantially the from the 1948 Saturday Evening Post.

In certain of their newspaper advertising in 1951, respondents made the following representations:

For hair and scalp care you can depend on your Barber s recommendation! Your barber is trained in bail' and scalp care and qualified to advise you. So if you happen to 1:0 troubled with dandruff, faling hair or some remember olber hail' problem, as so many men are, consult your barber.

III. Meaning of the Advertising Olaim8 The amended complaint charges tlmt respondents have represented: (1) That the use of J eris Antiseptic Hair Tonic wi1- (a) Cure dandruff (b) Relieve itchy scalp (c) Prevent excessive falling hair (d) Promote hair growth (e) Result in a healthy scalp.

(2) That barbers, by reason of their training, are c:lpable of diagnosing and treating diseased conditions of hair and scalp. The record does not contain any consumer testimony as to the meaning of these advertisenwnts. Ifowever, the Commission is of the opinion that such testimony is not needed, that it is capable of determining the meaning of these chims to the public.

For the reasons sj atell beloy, , the Commission is of the opinion that respondents Imve represented that the use of Jeris with massage wil help promote hair growth and prr.vent excessive hJling lJair * and that barbers, by reason of their tmining, are capable of diagnosing and treating di:'easecl conditions of h:lir and scalp. examination ot "'Respondents ' advertising was characterized by their counsel during witness called by respondents, as follows: help to The .lel'is people have F;tfltec1 that this product will help to do certain things keep your scalp clean and IH lp to prevent excessive falling hair and help to promote the growth of hair by the use of this product.

In their appeal brief they adopt the bearing examiner s interpretation. AR. WINARICK, INC., ET AL. 795 791 J!'indings Analyzing these claims in the same order as their meanings as alleged in the complaint are listed above:

(1) (a) Respondents' advertisements clearly state that Jeris destroys dandruff germs (pityrosporum ovale) on contact and that it removes dandruff flakes. They make no claim of cure for dandruff in excess of these statements.

(b) The record does not contain any representation as to itchy scalp since 1948. Respondents' claims have been revised to " relieves dry se,alp.

(c) The hearing examiner interpreted the phrase "relieves . . . excessive falJillg hail' '' to mean merely that massaging and cleaning the hail' will remove from the head that hair which comes out with combing or falls to the shoulders during the course of a day. The Commission, however, is of the opinion that the ordinary meaning of the loose hairwords shows that "relieves" means more than removing from the head, and that "excessive" means more than a normal condition of hair fall. This advertising in the ordinary sense of the words claims that the use of J eris, as directed, will be of value in relieving the conditions causing abnormal hair loss. It means the use of .Jeris will prevent excessive falling hair. The testimony of the medical witnesses show,; that they recognize "excessive fallng hair" to mean an abnormal condition for which they list many possible causes. (d) Similarly the phrase "helps promote healthy hair growth" represents that the use of J eris, as directed, will help to promote the growth of hail'.

(e) Respondents' claims as to the scalp are limited to claims that the use of .Jeris with massage will stimulate the scalp and relieve dry scalp. These claims do not constitute a representation that the use of J eris will result in a healthy scalp.

(2) Respondents' advertising as above quoted expressly states that barbers are trained in hair and scalp care and are qualified to advise you. It directs the readcr to consult his barber if troubled with dandruff, falling hair or some other hair problem. The implication of this advertisement is that the instruction of barbers qualifies them to diagnose and treat disturbances of the hair which might be caused by or related to diseases.

IV. Expert Medical Opinion Testimony The testimony of the medical witnesses as to the truth of these representations is conflicting. The testimony of Dr. J\farkel supports respondents' claims while that of Dr. Peck and Dr. Behrman disputes their correctness. A full analysis of the pertinent testimony of these Findings 50 F. T. C.

experts and of their professional qualifications is felt necessary to resolve this conflict.

Qualifications of the 'Witnesses Three doctors, all specialists in the field of dermatology, testified in this matter. All are diplomates of the American Board of Dermatology and Syphilogy.

Doctor Samuel M. Peck is Chief of the Department of Dermatology, Mt. Sinai Hospital, Clinical Professor of Dermatology, New York Medical College, Associate Clinical Professor of Dermatology at Columbia, and President of the Society for Investigative Dermatology. He has written three textbooks on dermatology and has published about 100 scientific publications. He is the associate editor of the journal for investigative dermatology.

Doctor Howard T. Behrman is an Assistant Clinical Professor of Dermatology, New York University College of Medicine, Adjunct Dermatologist, Mt. Sinai Hospital, and Assistant Dermatologist Hillside Hospital. He is the author of approximately 100 articles and four books in this field.

Doctor Joseph Markel has been engaged in private practice as a specialist in Dermatology for over seven years. He is presently attached to Mt. Sinai Hospital in the Dermatology Division. Previously he was in the Therapeutic Research Division on the dermatology stalT on the New York Post Graduate Medical School. Testimony as to Truth of Claims Dr. Peck testified that .Teris does not contain any special ingredient not usually found in hair tonics. It has a cleansing action due to its alcohol and 'vater content. It acts as a counter irritant and, especially if applied with massage, will have a temporary stimulating effect on the flow of blood to the scalp.

He believes that Jeris might aid in removing dandruff scales and relieve itching to some extent. lie testified that the great majority of cases of excessive falling hair are due to either hereditary factors endocrine changes or nutrition. To a lesser extent it is caused various diseased conditions. He does not list dandruff as a cause of excessive falling hair. In his opinion, Jeris would not be an effective treatment for those conditions which cause excessive falling hair, and 3mis used as directed would not prevent excessive falling hair. *It is apparent from the record that the word "cause" in line 24, page 55, Is the result of a stenog-raphic error and should be "prevent. Also from the remainder of Dr. Peck' testimony, it 1s clear that he is of the opinion that the use of "Jerfs, " as directed, will not prevent excessive falling hair.

AR. WINARICK, INC. , ET AL. 'i/. 791 Findings He further testified that .Jeris used with massage would have a temporary stimulating effect on the flow of blood to the scalp. does not believe that this increased blood flow would nourish the hail' roots or that the application of .Jeris will promote or in any way cause healthy hair growth. He has not been able to effectively treat falling hair or to cause hail' to regrow by using chemicals like J eris or by increasing the blood flow to the scalp even with much mol' effective methods than massage with Jeris. In his opiniun, nothing which dermatologists have at their disposal today promotes the growth of hair.

Dr. Behrman testified that the primary effect of .J eris would be to tlissolve dandruli' cells. It might temporarily relieve) certain cases of itchy scalp. Jeris, especially ,vhen used with massage, would increase the blood flow in the scalp.

He testi fied that the consensus of scientific thought is that male hail' loss is due to three basic things, heredity, amount of hormones produced alli the aging process. In addition to these, Dr. Behrman listed many distnrblmces and disorders which also cause excessive falling hair. He testified that J eris is not an effective treatment for these conditions and that its use as directed would not preve.nt excessive falling hair. He recognized dandruff' as a sign of a diseased scalp but does not list dtmdruff as a cause of falling hair. I-Ie testified that some dermatologists believe that dandruff might eonceivably accelerate the balding process. He also testified that increasing the blood flow in the scalp by massage with .Jeris for a few minutes would not be Leneficial, that hair nourishment depends on the content of the blood, and that the application of Jeris will not promote or in any way cause healthy hair growth.

Both Dr. Peck and Dr. Behrman testified that in their opinion a barber is not qualified by training and experience to diagnose and effectively treat diseased conditions of the hair and scalp. Dr. Markel testified that .Jm'is is a good e1eansing agent for the scalp, contains an antiseptic ingredient and a drug that stimulates the scalp and that used with massage it wil increase the lymphatic circulation of the scalp. He testified that the use of this product will result in a healthier scalp, will temporarily relieve itchy scalp due to some conditions, and wil help to promote the growth of healthy hair due to its cleansing action.

He testified that 85 percent of all baldness is due to dandruff and that.1 eris is a good product for certain types or dandruff. He rurther testified that .1m.js would help preserve a man s hair longer than if he used nothing at a11 , by keeping the scalp clean, free of seales and permitting normal tissue rPspirntion. He also testified that, by inereas- Findings 50 F. T. C.

ing the lymphatic circulation by massage, you may have a tendency to prevent your hair falling out as rapidly as it would without massage. He was of the opinion that "A man can save his crop of hair. V. Oonclusio'f From, the Expert Testimony Dr. Peck and Dr. Behrman are of the opinion that Jeris used as directed is of no value in preventing excessive falling hair and in promoting the growth of healthy hair. They do believe that it wil remove dandruff flakes from the head, wil temporarily increase circulation in the scalp, and help the scalp by keeping it clean. They express no opinion as to its effectiveness in destroying the germ, pityrosporum ovale. They are both of the opinion that barbers are not qualified by training and experience to diagnose and effectively treat diseased conditions of the hair and scalp.

Dr. Markel's views as to the value of Jeris in cases of excessive falling hair are based on the premise that dandruff is the cause of 85 percent of the cases of baldness. This premise is in conflict with the testimony of the other expert witnesses in this proceeding and with the consensns of scientific thought on this subject. His views that healthy hair growth is promoted by cleaning the scalp and allowing increased tissue respiration are rejected as being contrary to the weight of the evidence.

VI. Advertising Free Goods The amended complaint alleged and the hearing examiner found that respondents falsely represented that they were giving a bottle of "Fore " after shave lotion, away free, as the bottle of Fore was only furnished in connection with the purchase of a bottle of Jeris Antiseptic Hair Tonic.

Respondents, in fact, advertised that they would give a regular sized bottle of Fore, after shave lotion, free with a purchase of a bottle of Jeris Antiseptic Hair Tonic. The advertisements clearly showed that respondents were making a combination offer of a regularly priced 83-cent bottle of ,Yeris Antiseptic Hair Tonic plus a regularly priced 53-cent bottle of Fore, after shave lotion, at a combined price of 74 cents.

VII. Oontentions of the Parties Respondents contend that the initial decision is correct in all respects except: (1) the conclusion that their claim of giving a bottle of Fore free was false because it was only given upon the purchase of a bottle of Jeris, and (2) the conclusion that they represented that barbers are qualified to treat diseases of the hair and scalp. AR. WINARICK, INC. , ET AL. 799 791 Findings In support of the initial decision, respondents cite the Commission decision in the matter of Lambert Pharrnaeal Oompany as authority for the truthfulness of their advertising claims as to dandruff. this connection, they also point out that there is no evidence that J eris wil not destroy the pityrosporum ovale germ as advertised. They contend they have not represented that the use of their product will prevent excessive fallng hair or result in a healthy scalp. They further contend that Jeris will destroy the pityrosporum ovale germ will remove dandruff scales, relieve itchy scalp and aid the growth of hair.

Counsel supporting the complaint contend that all of the allegations of the complaint have been proven.

VIII. General Oonclu8lon8 On the basis of the above-stated facts and other evidence re,cord, the Commission concludes that respondents falsely advertised that the use of .Teris Antiseptic Hail' Tonic with massage will help promote hail' gro\l'h and prevent excessive falling hair and that barbers by reason of their training arc capabie of diagnosing and treating diseased conditions of the hair and SCI): 1'. It further concludes that the record does not cc'Lublish that respondents advertised that the use of J eris will result in a healthy scalp or that it will have any beneficial effect on dandruff' in excess of destroying pityrosporum ovale germs and n moving dandruff flakes. There is no showing that the claims as to dandruff' are false. Respondents advertising as to claims of relief of itchy scalp have not been shown to have been used since 1948. The record indicates that such claims have been modified and the original claim abandoned. The claim that a bottle of "Fore" was given away free is found not to be false 01' deceptive in any way. All of the conditions as to the offer were clearly stated. The price of 74 cents for the Jeris Antiseptic lIair TOllic ill the special combination offer is less than the regular price of 8:) cfmts for the sante sized botte of Jeris. This conelusion follows the reasoning of the Commission s decision in the matter of TValteT J. Black, Inc., et al. issued September 11, 1953. Respondents' representations concerning the preparation Jeris Antiseptic Hair Tonic hereinabove found to be false are mic1leading in a material respect. They have the capacity and tendency to mislead and deceive a substantial portion of the purchasing public into j mistaken belief that they are true, and into the purchase of subsLmtial quantities of this preparation as a result thereof. .J eris Antiseptic Hair Tonic, in addition to its cosmetic purposes, is intended for use in the treatment and prevention of hair and scalp diseilses in hmnans. 800 FEDERAL TUADE COMYIISSIOK DECISIONS Findings 50 F- T. C. CO::CLl7SlONS OF LAW The Commisison, therefore, concludes that respondents' false representations of Jeris Antiseptic I-lair Tonic constitute false advertisements likely to induce the purchase of a drug and COSITwtic within the meaning of section 12 of the Federal Trade Commission Act. The Commission further concludes that respondents' use of the false representations as hereinabove -found is to the prejudice and injury of the public and constitutes unfair and deceptive acts and practices in commerce within the meaning 01' the Federal Trade Commission Act. onmm OF AI'JEALS It is ordcTed That the appeal 01' counsel supporting Ule compbint from the initial decision of the hearing examiner i:; hereby gmnted insofar as it reJates to the dismissal by the initial decision of the ablegations of the complaint chargi ng that respondents have falsely ad I'ertised that Jeris Antiseptic Hail' Tonic will prevent excessive falling hair and promote hail' growth. In tllJ other respects said appeal is denied.

That respondents' appe:d ham the initial deci- I t -is lurther O1'dwl'ed sion 01' the hearing examiner is Lel'clJy granted insol'ar as it relales to the conclusion that respomlent s' -free olrer was in viol:tion of the Ferlend Trade Commission Act. In all other respects said appeal is denied.

THE HE1\TEDY The Commission, having determined on the basis of the record that respondents have falsely ad,-ertised, must 110\1' determine the necessary and proper form of relici.

H:,spondents' advertising is not i-Jgl'utly fube. Tlwy achenise their product largely as a cosmetic. But they have made several :Illvertising claims 01' a medical nature. Certain of these lune not been found to be Jalse, one nppe:Jl's to have been almndonecl and emtaill of UH'11l, responden1 s state, are 0111 r HJ( ant as eJainls of a cosnletic nature. Hesponclents, hmve\'er, have contended throughout this procoeelJing that (hc, use 01' their products will help promote or aid the growth of hair ,cud that their claim of relieving eXGessiye falling hail' is propel' The Commission s experience in this ijeld has informed it that members of the public are particularly sensitive about loss 01' hair and are oyer1y sllsceptible to claims that a product OJ' treatment ",ill help gl;:\nl :Jgainst hail' loss or help promote hnil' growth. There is a great ceJlptatioJ! to sellers of hail' preparations to make such cl:Lims or at least to imply that such beneiits will result from the nse of their product.

AR. WIKARICK, INC. , ET AL. 801 791 Order The Commission has issued orders in other cases prohibiting the dissemination in commerce of false representations that hail' preparations !!srd with massage, willlwve any effect in preventing loss of hail' or \vill promote the growth of hair.

For these reasons the Commission is of the opinion that the proper relief herein is an order prohibiting the dissemination oJ advertisements which represent that the nse of Jeris as directed will relieve or prevent excessive falling h"ir or promote or help to promote hair gnrwth. For similar reasons, it is believed tlHlt respondents should be fOllndjJroLibitpd from misrepresenting the qualifications of barbers as herein.

OHDEH TO CEASE AXD DESIST 1 tis ordered Tllat the respondent AI' IVinarick, Inc., a corporation and its officers, and respondents .J ules IViIJfrick, Nathan IVinarick, and Floyd I-I. Pepper, individually and as offcers oJ Ar. IVinarick, Inc. and their respective oiIicers, agents, and employees, directly or through my eorpomte or other device, in connection with the offering for sale sale or distrilmtion of the preparation "J eris Antiseptic Hail' Tonic 01' any product of substantially the same composition or possessing substantia Ily similar properties, whether sold under the same name or under any other name, do forthwith cease and desist from directly or imlil'ectly:

1. Disseminating or causing to be disseminated, by means of the " isl'niU,d States mails, 01 hy any means in commerce, as "commerce defined in the Federal Trade Commission Act, any advertisement ,which represents, directly or by implication, that the nse of said prepn rati on will :

(a) Ilelieve or IJCJp to prevent excessive falling hail'. (b) Promote or' help to promote hair growth. 2. Disseminating or causing to be disseminated, by any means, any achert.isernent, for the purpose of inducing, or which is likely to indnee directly or indirectly, the pnn:hase 01' said preparation in commcn:e, as cornmerccc" is defined in the Federal Trade Commission Act, which aclvPItisement contains any of the representations prohibited in paragraph 1 hereof.

it is further O1'del'd That the respondent AI'. vVinarick, Inc. , a corporation, and its offcers, and respondents Jules vVinarick, Nathan AI'. IVinarick and Floyd H. Pepper, individually and as offcers of agents, aml employees vVinarick, Inc. , and their reqJective offcers, clircctly or through any corporate or other device, in connection with the offering 1'or sale, sale or distribution of their jJleparaj ions " Teris " or any other preparation of sub- Antiseptic Hair Tonic" and "Fore 40;H4: 57-- - !J:2 802 FEDERAL TRADE CO;VIMISSION DECISIONS Opinion 50 F; T. C.

stantially the same composition or possessing substantially similar properties, in commerce, as "commerce" is defined in the Federal Trade Commission Act, do forthwith cease and desist from Hepresenting, directly or by implication, that barbers 1u'e qualified for or capable of diagnosing or treating diseased conditions of the hair or scalp.

It is further ordej' That respondents shall, within sixty (GO) 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. Commissioner Mead concurring except for the finding regarding use of the word "free. (See ;)lead dissent in ';Valter .J. Black, Inc., et aI. Docket 5571). Commissioners Mason and Gwynne dissent except for the fmding regarding use of the word "free. DISSENTll'G OPINION By (1WYNNE, Commissioner:

Paragraph Six 01' the Almmded Complaint charges tlwt responden ts represented:

(1) that the use of their preparation.Jeris c\ntiseptic Hair Tonic- (a) wiJJ cure dandruff' (b) wil relieve itehy sealp;

(e) wil prevent excessi ve falling hair:

(d) used with massage wiJJ stimulate blood How in the scalp to Nu" extent that the hair roots will be nourished and hair growth promoted; (e) will result in a healthy sealp;

(2) that barbers by reason of their training arc capable of diagnosing and treating diseased conditions of hair and sealp. The hearing examiner found against counsel supporting the cornplaint as to all charges except that contained in (2) above. The majority opinion reverseR the hearing examiner as to (1) (c) and (1) (d), and approves llis conclusions as to (1) (a), (1) (b), (1) (e), and (2).

This dissent has to do only with (1) (c), (1) (d), ami (2). (7) (c) That the use of respondents ' 7))O ep!lrat-ion 10ill prevent excessive fall-ing hccir.

As to this claimed representation, the hearing examiner found that tlw advcrtiscments used the word "relieve" rather than "prevent" and that the two words are not synonymons.

III this 1 agree with the hearing examiner. )\n examination of the l'xhibits fa ils to find any nse of the word "prevent" in connection with the word, "pxcessiw falling" lwil' '1118 ,'- onls "relieves excessive fact- AR. WINARICK, INC., ET AL. 803 791 Opinion s Exhibits 1 , 5 , 6, and 8. In noneing hair" are found in Commission Df these exhibits is any language used which would justify the charge that respondents' product is capable of preventing excessive fallng hair.

That there is a difference in the meaning of the two words is obvious. A witness for counsel for the complaint (in connection with his testimony as to dandruff' ) said: "I would say the word ' relief' means a temporary minimizing.

On this part of the case the hearing examiner said: As to the effect of J eris upon excessive falling hair the record is scanty. It is clear that Jeris will neither prevent nor cure baldness but there is no charge to that effect. It will not prevent falling hair. The advertisements do not say that it will. Through massage and cleansing, incident to the use of J eris, loose hairs will be removed. Excessive falling hair' was not defined and is a term of indefinite connotation. It might refer to the hair that comes out with combing or falls to the shoulders during the course of a day. This certainly will be reduced by daily massage and cleansing. In the absence of more specific evidence and upon the state of the record the charge in respect to excessive. falling hair cannot be found to have been established.

The evidence, however, goes a little beyond that. A witness for counsel for the complaint testified that dandruff might cause falling hair and that the removal of dandruff might help in that regard. There is other evidence that preparations such as the one in question are an aid in the removal of dandruff and that, coupled with massage might lessen the amount of falling hair.

(1) (d) That used oith ?na.ssa,qe, r.respondents' preparation will stimulate blood flo o in tle scalp to the extent that hair roots will be nourished and hair growth promoted.

The complaint does not charge respondents with representing that its product "will promote hair growth" used independently of massage. There is testimony that massage would tempomrily increase the flow of blood to the scalp and that such process would be aided by a prodand also helps re-uct such as J eris, which acts as a counter-irritant move dandruff scales. There is a dispute as to the amount of good if any, that increasing the circulation in the scalp would accomplish expert witness for the respondentsin promoting hair growth. The testified it would have good results. The testimony of the e.xperts for counsel supporting the complaint is not a categorical denial of this proposition. In fact in their own work they apparel.ntly recognize tlmt increasing the flow of blood to the scalp might be benefieial to the ,'cal p a nc1 hair.

804 FEDERAL TRADE COM:MISSIOi' DECISIONS Opinion 50 F. T. C.

AU the expert witnesses ,Ycle commendably frank in their testimony. They point out that there is no complete agreement as to what will affect hair growth and tl1ft scientific opinion on the subject has been and is subject to change. It is interesting to note that there is not the certainty among he experts on this subject that seems to exist in other quarters.

The hearing examiner did not attempt to resolve the disputed questions of fact as to (1) (c) and (1) (d). Faced by this uncertain!.) and confiiet 0'1' opinion, he held that he party h:\ing the burden of proof had failed to sustain it. In such a situation the findings of the hearing examiner who saw and heard the witnesses should be given considerable 'weight by the Commission. (See 7hll:'/)equal Canwm COI'p. v. fVufjonal aboI' Helal' /:on.\ Boai'd g4() U. S. 474 , and Folds Fede/' al Trade Comm.ission 187 F. 2d658.

(2) That baI'beT's by 'reason of IheiT I'mining ((Oe capable of d1(((/nosiny and II'eal.jng diseased conditl:ons of the ha'(1' and scalp This charge is based on the following advertisemeni For hair and scalp care you can depend on your barber s recommendation. Your barber is traiued in hai r and scalp care and qu:dified t.o advise you. So, if yon happen to be trolibled with dandrnff JalJing hair, or some other JUlir problem, as so many men are remember t.o consult your barber.

The evidence is that dandruJ)', itchy scalp, and falling hail' are symptoms which may arise from many causes, including certain diseases which could be treated only by qualified members of the medical profession. However, it appears that the percentage due to cliseilses (as that word is generally understood) is rehltively sm tll. There is evidence that 85 percent of all dandruff is "ordinary" dandrufi which may be removed by certain eleansiug agents and other attention which barbers rather than doctors are qualified to render. To conclude from the abm.e advertisement that barbers arc qualified 1()to treat disen.ses would seem to be unrealistic. If n. barbel' shou publish a similar n.advertisement n.about his qualifications, it is diflcl111 to imagine any locn.l prosecuting attomey bringing him into court on the ground that he was holding himself out as a doctor. The functions and duties of the barbel' and the physician are well known. 'IVe should not conclude that the public will fail to interpret. this l(Jypl'tisement against. their backgrol1ml of general hmn m experience am) knowledge.

The reasonable interpretation of the language of ille adYCltispment is that t.he barber is qualified to a(lvise you as (l ba:l'ber in that field in which barbers normally operate. His advice to a person snfferi11g AR. WINARICK, INC., ET AL. 805 791 Opinion from some scalp diseases might be to consult a doctor. Most general practitioners in the medical profession refer a patient to a specialist when the situation requires it. That would not prevent them from holding themselves out as physicians capable of administering to most .of the needs of their patients and of directing them to specialists when that was the proper course.

r suspect that on every working day thousands of people do consult their barbers in regard to hair and scalp care. They will be interested to learn that an agency of the Federal Government now proposes that they first go to their physician or perhaps their psychiatrist. The following statement of the hearing examiner is worthy of thoughtful consideration.

About the meaning to the public of any particular advertisements there may well be honest differences of opinion but there are certain principles which should be controlling. Statements should not be read out of context. Words of simple and well established meaning should be accepted at their ordinary connotation. The advertisement should be considered in relationship to the product advertised. The product at issue in this proceeding is a hair tonic not medicament. The general public would not look upon the advertisements of a hair tonic with the same expectancy as they would upon an advertisement of a medicient having alleged curative powers. The language used by respondents is simple language which those of even the most modest education should be able to rmtd and understand. There is nothing mysterious or involved in the phraseology. Respondents' product is harmless.

In the words of a distinguished jurist in Prima Products, Inc. Federal Trade C01n7ni88ion (decided January 7, 1954, by the United States Circuit Court of Appeals for the Second Circuit) : "The controversy now before us bears a marked resemblance to the proverbial empes II a teapot.

I would dismiss the complaint.

Commissioner Thl",so joins in this dissent. Syllabus 50 If. T. C IN THE MATTER JAMES H. SEWELL AND GEOIWE PEPPERDINE, TRADING AS BURNS CUBOID COMPANY DECISION IN REGARD TO THE ALLEGED VIOLATION OF Tile FEDERAI TIL\DE nnSSION ACT , Mar. , 195 Docket 5850. Complaint, Feb. 1951-Decision Where two partuers engaged in the manufacture of a deyiee designated as Cuboids BurIls Cuboids " or " Cuboid Foot Bal:uH.:ers," Hwde of ('ork, felt, leather, with no metal, and in the interstate sale of said products and of a similar supplemental device known as "Doggies" to numerous department stores and shoe stores; in advertising through circulars and advertisements in nevi'spapers magazines, and other periodicals- (a) Represented that the nse of their devict's would assist the \vearer to obtain body balance and foot balance, would relieve aches and pains regardless the cause, would result in more normal foot action, assure the user of a posture poise and balance and assist in improvinr; the stance; (b) Hepresented that housework would be rendered less tiresome by wearing said devices, that use thereof would afford increased foot health and C()Jlfort and beneficially assist in the distribution of the body weir;ht; (c) Hepresented that upon eOlTect position of the cuboid bone depended the relative position of every other bone in the foot and that if such bones wcrc or assist to nor maladjusted as to position, use of such device would serve llalize their position and that calloused feet wouid be relieved by the use thereof; and (d) Additional1 : represented through the use of the tprm " Foot Balancers!! In the uesigu;! liun and description of their device, that use thereof would assist tbe wearer to balance the feet or body; The facts being that foot disorders or foot troubles generally would not b" benefited by wearing said devices; instances in which they would serv,' beneficially to ehanr;e the area of pressure would be fortuitous and rare; use thereof might aggravate the condition for which used; they were not effective treatment for ordinary foot aches and pains and had no therapeutic value in the treatment thereof; could not lJe relied upon to lessen the fatigue caused by housework or other physical effort; would not favorably influence tJ1C position, action, or function of the cuboid bone which plays only minor role in balandng the body; nor realign, etc. , the position of other bones in the feet; and there was no reasonable possibilty that those wearing respon1clcnts' shoe inserts secured through fitting and recommendation of respondents' representatives or by other sales personnel would receiye the orthopedic corrective or therapeutic benefits which their advertisements pI'mnised would be afforded to them:

Held That such acts and practices, under the circumstances set forth were all ,lecep to the prejudice ami injury of the public aud constituted unfair and tive acts and practices in commerce.

Before Mr. Everett F. Il aycr-jt hearing examiner. Mr. R. P. Bellingcr for the Commission. Mr. George R. M aury, of Los Angeles, Calif., for respondents. BUR",S CUBOID CO. 807 806 Findings DECISION m' THE cOJlnnSSlON AND ORDER TO FILE REPORT OF COMPLIANCE Pursuant to the provisions of the Federal Trade Commission Act the Federal Trade Commission on February 21, 1951, issued and subsequently served its complaint in this proceeding upon James H. Sewell and George Pepperdine, co-partners trading as Burns Cuboid Company, charging said respondents with the use of unfair and deceptive acts and practices in commerce in violation of the provisions of said Act. After the issuance of said complaint and the filing by respondents of their answer thereto, hearings were held at which testimony and other evidence in support of and in opposition to the allegations of the complaint were introduced before a hearing examiner of the Commission, theretofore designated by it, and such testimony and other evidence were duly recorded and filed in the offce of the Commission. On December 31, 1952, the hearing examiner filed his initial decision.

Thereafter, within the time permitted by the Rules of Practice of the Commission, respondent James H. Sewell appealed from the initial decision of the hearing examiner and this matter came on for final hearing upon the complaint, answer, testimony and other evidence briefs in support of and in opposition to such appeal and oral argument; and the Commission, having duly considered the record herein and having ruled upon said appeal and being now fully advised in the premises, finds that this proceeding is in the interest of the public and makes the foliowing findings as to the facts, conclusion drawn therefrom, and order, the same to be in lieu of the initial deeision of the hearing examiner.

FI.:DINGS AS TO THE I'ACTS PARAGRAPH 1. At the time of the issuance of the complaint herein respondents James H. Sewell and ("george Peppel'line were co- partners trading as Burns Cuboid Company having their principal place of business at 414 East 4th Street, Santa Ana, CalifOJ'nia. On or about .May 1951, respondent George Pepperdine disposed of his entire interest in said business to his co-partner respondent James H. Sewell and since that time has had no connection whatever with that business. Respondent James II. Sewell, being the sole owner thereof, has operated the business in the name of Burns Cuboid Company, the address of the business remaining the same. PAH. 2. Said respondents for several years last past have been, and respondent James II. Sewell now is, engaged ill the business of manufacturing and selling a device, as "device" is defined in the Federal Trade Commission Act, generally designated as "Cuboids Burns ;

808 FJWERAL TRADJ, COMMISSION DECISIOXS Findings 50 F. T. C.

and an experimental deviceCuboids" or "Cuboid Foot Balancers" which is similar thereto known as "Doggies." Respondents' device is made of cork, felt and leather, containing no metal whatsoever, and has elevations along its sides beginning where the forward sides of the wearer s heel will be placed when worn. These elevations extend forward and are intended to end as an elevfltion across the area of the ball of the foot behind the metatarsal joints. Respondents' products are sold in pairs for insertion in shoes for the purpose of relieving foot troubles, aiding in balancing the feet flnd the body, assisting the bones of the feet to regain and hold their normal positions, flnd to generally add comfort otherwise to the feet of the wearer. Respondents have caused said devices to be transported from their place of business in the State of California to purchasers thereof and to numerous department stores flnd shoe stores located in various other States of the United States, in which department stores and shoe stores respondents have representatives for the purpose of Jitting the device into the shoes of customers and selling the same to the individual customers. During the times mentioned herein, respondents have mflintained a course of trade in said products in commerce between and among the various States of the United SUltes.

PAR. 3. Respondents, since 1947, have disseminated and are now disseminating advertisements concerning their said device by the United States mails and by various other means in commerce as for the commerce" is defined in the Federal Trade Commission Ad purpose of inducing and which were likely to induce, directly or indirectly, the purchase of said device; and respondents have disseminated and have caused the dissemination of advertisements concerning their said device by various means for the purpose of inducing and which were likely to induce, directly or iudirectly, the purchase of their device in commerce as "commerce" is defined in the Federal Trade Commission Act. lncluded in the circulars, leaflets, pamphlets and advertisements appearing in newspapers, magazines and other periodicals of interstate circulation, which respondents have disseminated or caused to be disseminated, have been the following statements and representations:

Cnboids help to Imlance your bolly weight ClJBOID FOOT BALANCERS " " " the foot and body balance, tbe relief from aches and pains CUBOIDS allord. Better poise and baiance replace aches and pains. Enjoy more normal foot action with Cuboids. scientific principles of bal- they re tbe modern way to foot: relief-combining ance and support to Jessen fatigue and help improve your stance. ,, :

BURNS CUBOID CO. 80Y 806 Findings \with Cuboids. Now everyone can enjoy better postnre, IJoise. and balance l\etai-Free Cuboids.

Especially designed to help you enjoy inereased foot health and comfort. With Cuboids foot pains often disappear as if by magic. Cuboids foot balancers rnake housework less tiring. Cuboids help to dist ribute body weight * * * The feet arc the body s founda tion. Cuboids balance this foundation and provide the basis for correct postnre.

Tbe Cuboid bone is the J,eystone of the outer or weight-bearing arch and its position determines the relative position of every other bone in tbe foot. to help bring theseCuboid metal-free foot balancers are seientificalJ,y designed bones into normal position.

Cuboi(ls afford etIeetive relief to aching and ealJoused feet. PAR. 4. Through use of the advertisements containing the statements and representations hereinabove set forth, respondents have represented, directly and by implication, that the use of their device will assist the wearer to obtain body balance and foot balance; that it will relieve aches and paim regardless of the cause thereof; that more normal foot action will result from the use of said device; that respondents' device will assure the user better posture, poise and balance and that it wil assist in improving the stance; that housework will be rendered Jess tiresome by wearing Cuboids; that the use of respondents' device will afford increased foot health and comfort and beneficially assist in the distribution of body weight; that upon the correct position of the Cuboid bone depends the relative position of every other bone in the foot, and that if these bones are maladjusted as to position the use of suchlevice will serve or assist to normalize their position; and that calloused feet wil be relieved by the nse of Cuboids. Through use of the term "Foot Balancers" in the designation and description of their device, respondents additionally represent and indicate that the use of their device will assist the wearer to balance the feet or body.

PAR. 5. Conflicting testimony was presented and received with respect to the truth or falsity of the foregoing representations. Orthopedic surgeons well trained in their field expressed opinions conclusions thatduring the course of their testimony which support such representations were false and misleading. On the other hand the witnesses supporting the contention of the respondents that said representations were for the most part true consisted of a general practitioner who had not been in active practice for a number of years but who testified that he had given study to the question of posture of human beings; and another doctor of medicine who is also an osteopathic physician and who, in addition to conducting a practice primarily devoted to the treatment of foot conditions, has been engaged for many years as an adviser to a manufacturer of shoes featuring a Findings 50 F. T. C.

device similar to that manufactured and sold by respondents. Considered also by the Commission in reaching its decision here, in the same manner as if the physician therein referred to had appeared s a witness in this proceeding, have been the evidentiary matters set forth in respondents offer of proof " appearing at pages 871 to 877 of the transcript of hearings.

PAR. 6. In attaining body balance in the foot, a person stands on what is called a tripod made up of the calcaneous (heel bone), the first metatarsal head, and the fifth metatarsal head, bound together with ligaments, tBndons, and muscles, all of which are used, together with nerve supplies to those muscles, to maintain equilibrium. The main arch of the foot, known as the longitudinal arch, extends from the heel to the metatarsal area on the inner side of the foot and its components include the following bones: the calcaneous or heel bone the astragalus or ankle bone, the scaphoid or navicular, the internal cuneiform and the first metatarsal. Most of the body weight thrust from the tibia bone of the leg is received and distributed through the medial group of bones just enumerated, both in a standing position and during locomotion.

The human foot is constructed to adequately bear the weight of the body without any further aid to nature. Before correct treatment can be decided upon for any person complaining of trouble with his feet, which requires realignment or readjustment of the foot bones, it is essential to obtain a complete history of the case including a thorough and expert diagnosis. Consideration must be given to the shoes being worn and sometimes X-rays must be taken. Frequently, treatment which may be beneficial for one :foot may not be appropriate for the other foot of the same individual. A layman cannot make an accurate diagnosis of the conditions causing foot disorders. PAR. 7. Testimony was introduced by respondents to the effect among other things, that their device tends to fill in areas in the rear o:f the shoe where it is asserted, in many instances, a shoe does not fit or conform to the foot properly, that the device serves as a foundation for the Cuboid Bone where the weight assertedly is being balanced and that its use acts to throw weight to the outer border of the foot and elevate the forward metatarsal area. These attributes, respondents contend, demonstrate, among other things, that the use of Cuboids aids in the distribution of weight and assists the wearer to attain foot and body balance.

Although it is true that respondents' device when inserted occupies or takes up some physical space in the shoe and that some depression of the Cuboids' rear surface may result from weal', other testimony presented in support of the allegations of the complaint indicates that BURNS CUBOID CO. 811 806 Findings the device cannot be expected to grasp or grip suffciently on the sides of the heel of the foot to correct all rolling tendencies of the heel or significantly support the back of the heel. Probative evidence was received also to the effect that respondents' device will not be instrumental in throwing the weight to the outer border of the foot should modification in these respects be of advantage. One reason why respondents' device manifestly cannot be depended upon to have this specific effect is the circumstances that both sides of the device are raised and there is the tendency for these lateral elevations to balance one another out.

Similar considerations give reason to doubt if the frontal elevation intended to end behind the metatarsal joints necessarily in all instances of use wil raise materially the frontal area in relation to the heel bone. Assuming that elevation is afforded, however, there would be no assurance that a corresponding depression would exist in the metatarsal area. so that pressure might be relieved and an improvement in balance or weight distribution stem therefrom. Respondents' support is so constructed, moreover, that it cannot affect the ligaments the bony structures or the neuromuscular mechanism entering into the balance of the foot. Clear and convincing also is other testimony presented by witnesses called by counsel supporting the complaint to the effect that the elevations in Cuboids do not support or serve as a foundation for the Cuboid Bone.

Foot disorders or foot troubles generally, will not be Lenefitted by wearing respondents' device. The only way that foot troubles can be corrected or relieved by using respondents' device would be through the relief of pressure in t.he metatarsal area in the region of the ball of the foot. As stated by one witness with respect to respondents device: "* * " if it happens to fit correctly and the particular person happened to have a foot which was adapted to this device, then the position of this metatarsal pad might happily hit the right spot. * * * It appears from the greater weight of the evidence that the instances in which Cuboids would serve beneficially to change the area of pressure would be happen stances and merely occasional or rare instances. On the other hand, the use of respondents' device might aggravate the condition for which it was being used to correct. Upon the basis of its consideration of the testimony and its consideration of the device itsell, the Commission has concluded that the greater weight of the evidence demonstrates that there is no reasonable probability that those wearing respondents' shoe inserts secured through fitting and recommendation of respondents' representatives or by other sales personnel will receive the orthopedic, corrective, or therapeutic benefits which respondents' aforesaid advertising promises will be afforded to them.

812 FEDERAL TRADE COMMISSION DI,CISIOKS Findings 50 I" . T. C. PAl!. 8. Upon the basis of the greater weight of the evidence, the Commission has concluded that the use of Cuboids wil not assist the wearer to attain body balance or foot balance, or assist beneficially in the distribution of body weight. Such use wil not be generally efiective in affording the user better posture or poise or an improve- Inent in stance nor will more normal or improved foot action result therefrom. The wearing of respondents' device win not afford or increase general foot health. Although the wearing of Cuboids may iu some instances aid strained, tired feet, respondents' device cannot be relied upon to give comfort to users who have foot troubles or to correct or relieve conditions caused by misfitted shoes. Respondents device is not an effective treatment for ordinary foot aches and pains and has no therapeutic value in the treatment of aching or painful feet. Cuboids win not be generally effective in treating or relieving calloused foot conditions and the use of Cuboids cannot be relied upon to lessen the fatigue caused by housework or other physical effort. The Cuboid Bone is a bone shaped roughly in the form of a cube and is located toward the outer side of the foot near the fifth metatarsal. It is not recognized as initiating or activating any important function of the foot and although every bone in the foot is essential, the role of the Cuboid Bone in balancing the body is minor in degree. It is not the focal point or keystone for weight bearing either in stance or during locomotion, and in no sense do the foi',es of thrust concentrate upon the Cuboid Bone as the weight is being taken from the foot. The wearing of Cuboids wil not favorably influence the position, action or function of the Cuboid Bone, nor win such use realign, readjust 01' normalize or improve the position of other bones of the feet. PAR. 9. As previously stated, Cuboids will not assist in balancing the foot or the body or assist beneficially in the distribution of body weight nor win respondents' device be effective in improving the position of the bones of the feet. The Commission has accordingly concluded that respondents' use of the term " Foot Balancers" in the advertising for the device Cuboids has been false, misleading and deceptive and that only by excision of such term from respondents' advertising can the deception which has been engendered by its use in respondents advertising be eliminated.

PAR 10. (a) The complaint in this proceeding additionally charged that respondents in their advertising have represented that their device win strengthen weak museles and feet, will improve poor circulation and wiJJ be effective in relieving pressure from sensitive parts of the feet such as nerve centers, and alleged in such connection that thes(, statements and representations constituted false advertisements. It BURNS CUBOID CO. 813 806 Order appears from the record, however, that the advertising statements to which these allegations refer have been discontinued and that they lmve not been used by respondents since the year 1\)L17 which time is more than 1three years prior to the date when this proceeding was instituted. In the circmnstances, the Commission is of the view that these charges of the complaint should be dismissed without prejudice to the right of the Commission to reopen this proceeding or to take such further or other action in the future as may be warranted by the then existing circumstances.

(b) The comphillt also charges that respondents have represented that the use of Cuboids will afi'ord relief to strained, tired feet and a l1eges, in such connedion, that respondents' device possesses no therapeutic value as an aid to strained, tired feet. The greater weight of the evidence adduced in this proceeding does not support a conc111sion that respondents' device possesses no value as an aid to strained ti red feet and the Commission is, accordingly, of the view that the charges relating to this issue of the proceeding should be dismissed. \R. 11. The use by respondents of t,11e statements and representations, as found in Paragraphs iJ and 4 hereof, has the tendency and capacity to mislead and deceive a substantial portion of the purchasing public into the erroneous belief tnat such statements and representations are tnJe and to induce a substantial portion of the purchasing public because of such erroneous and mistaken belief to purchase H\spondents' clevice.

CLCSlON The aforesaid acts and practices of respondents, as herein found are all to the prejudice and injury of the public and constitute unfair and deceptive acts and practices in commerce e within the intent and meaning of the Federal Trade Commission Ad. ORDER 1 t is ordered That the respondents .r ames H. Sewell and George Pepperdine, individually and as copartners trading as Burns Cuboid Company, or under any other name, their agents, representatives and employees, directly or through any corporate or other device, in C011nection with the offering for sale, sale or distribution of respondents device, designated generally as "Cuboids Burns Cuboids Cuboid Foot Balancers " or "Doggies " or any deyicc of sllbstantia11,y similar construction or composition, whether sold linden' the said names or any other names, do forthwith cease and desist from: Order 50 F. T. C. 1. Disseminating or causing to be disseminated by means of the United States mails, or by any means in commerce, as "commerce" is defined in the Federal Trade Commission Act, any advertisement which represents directly or by implication: (a) That thl' wearing of respondents' device will assist in balancing the feet or body.

(b) That respondents' device possesses therapeutic value for aching or painful feet.

(c) That the wearing of respondents' device will enable the user to achieve better posture or poise or will improve the stance. (d) That the wearing of respondents' device win result in more normal foot action or improved foot action or foot health. (e) That the wearing of respondents' device win afford increased comfort for the feet or decrease the fatigue resulting from housework or other physical efforts except to the extent that respondents' device may in instances reduc e or relieve the diseomfort associated with strained or tired feet.

(f) That the wearing of respondents' device will have beneficial effect upon the distribution of body weight. (g) That the wearing of respondents' device will in any way aid the Cuboid Bone or its position or stability with respect to other bones of the feet or will serve to readjust, realign, normalize, or improve the position of the bones of the -feet.

(h) That said device possesses therapeutic value in the treatment of ca110used feet.

2. Disseminating or causing to be disseminated any advertisement by any means for the purpose of inducing or which is likely to induce directly or indirectly, the purchase of said pruduct in commerce, as commerce" is defined in the Federal Trade Commission Act, which advertisement contains any representation pruhibited in Paragraph 1 hereof.

It is further ordered That respondents, in connection with the offering for sale, sale or distribution in commerce, as "commerce" is defined in the Federal Trade Commission Act, of their device, as a-foresaid, do forthwith cease and desist from m" \)f the expression "Foot Balancl'rs " or any other term or words of similar import or meaning to designate, describe or refer to their device. It is further ordered That the charges of the complaint referred to in subparagraph (a) of Paragraph 10 of the Commission s findings as to the facts be, and the smne hereby are, dismissed without prej udice and that the allegations of said complaint to which subparagraph (b) thereof relates be, and the same hereby are, dismissed. BURNS CUBOID CO. 815 806 Order It is further ordered That the respondents herein shall within sixty (60) days after service upon them of this order, fie 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. Commissioner Mead not participating for the reason that he did not hear oral argument and Commissioner Gwynne not participating for the reason that oral argument herein was heard prior to his appointment to the Commission.

816 EDJmAL TRAm: CO:VIMISSIOK DECISIONS Decision 50 :If. :e. c. IN THE J\fatter R:\1PIEE PRESS, l, ET AL.

DECISION IN REGARD TO THE ALLEGED VIOLATION OF Tile i"EDEJUL 'J):,\DE COMMISSION ACT Docket 6086. Cornplwint, J1Iar. 20 , 1953- Decision, jlla.,. , 19/5' here a corporation, and two individuals who controlled it, ellgagpd in the of many kinds of JJUsh manufacture and interstate sale and dist.rilJUtion cards and punchboards so arranged as to involve games of ('hance, gift enterprises, or lottery schemes when used ill making sales of ll€rc'bandise to the consuming public, and including (1) "merchandise hoards; (2) "money boards which provided for the distribution of cash ;!llwun1.s rather than IHcrchandise to those securing winning numbers; and (8) "plain boards with a blank " label" upon Nhich purchaser-dealers, peddlcrs, or operators placed. their own label or legend. for use in cOlnbination with otl1el' lJel'chandise-- Sold and distributed such devices to many dealers in commelTC h1 candy, cigarettes, clocks, razors, wallets, tireurms, and other articles, who asselubleu with tlh ln assortments of various article, which they eX!Jose(l and :sold to the purchasing public ill accordnnce with the afores.tid sales plans; and Ot1101'8 the means of cOlldlletingThereby supplied to and lllaeed in the hands of lotteries, galIlcs of chance, or gift enterprises in tiw sale or distribution of their merchandise, contrary to an established puhlic policy of t be United States Government and in violat.ion of criminal laws, illHl means for prlgaging in unfair acts and practi c' s :

lleld That such acts and practices were nil to the IlrcjudiLe and injury ()j' the public and constituted unfair acts find pract.ices in ('01tll11l-J'' Before lJh' . John Lewis hearing examiner. Mr. J. W. Brookfie7d, Jr. for the Commission. and Mr. Joseph F. HW' 1Is of Chicago, 111. Mr'. Maurice J. .Walsh for respondents.

INITIAL DECISIO;. BY JOHN LEWIS , HE.\HlNG EXA U:SEH Pursuant to the provisions of 0(( Fe(lera I Tnule COllmission A('t 20 , 1D:;;J, issnel! and snhse-the Fedend Trade Commission on .'.hrch quently served its complaint in this procpeding upon the respondents tJIPm with the use of nllfail'named in the caption hereof, dwrging COllmwrce in yjolatioll of the pro-and deceptive acts alld practices in visiolls of said Ad. After the issuance of saiel complaint am! the filing of respondents' allswer thereto, hearillgs were held at which testimony ane! other evidence ill support of the allegations of said complaint were introducellhefo!'c thc ahove- named hearing exmniner. EMPIRE PRE B16 Findings theretofore duly designated by the Commission, and said testimony and other evidence was duly recorded and fied in the offce of the Commission. Although respondents received due notice of all hearings md appeared by counsel at the first of said hearings they made no appearance at subsequent hearings and waived the opportunity afforded them to offer evidence in opposition to the allegations of the complaint. Thereafter, the proceeding regularly came on for final consideration by the hearing examiner on the complaint, the answer thereto, testimony and other evidence, and proposed findings as to the facts and conclusions presented by counsel, oral argument not having been requested; and said hearing examiner, having duly considered the record herein, finds that this proceeding is in the interest of the public and makes the following findings as to the facts, conclusion dnnvn therefrom, and order:

FINDINGS AS TO THE FACTS PARAGRAPH 1. Respondent Empire Press, Inc., is :t corporation organized, existing and doing business nnc1er and by virtue of the htws of the Stace of lllinois, with its offce and principal place of business joc:lted at 4GG Divest Superior Street in the City of Chicago, Illinois. Respondents Sylvea Zimmerman, Evelyn Zimmerman and Joseph Zimmerman are president, secretary, and general manager, respectively, of s:tid corporate respondent. Respondent Sylvea Zimmerman is the wife of respondent .Joseph Zimmerman and owns 98 percent of the stock of the corporate respondent. Said corporate respondent is dominated, contro1Jed and directed by the individual respondents Joseph Zimmerman and Sylvea Zimmerman, and said respondents have cooperated and acted together in j:he performance of the acts and practices hereinafter found. Respondent Evelyn Zimmerman although an officer of the corporate respondent, has not been employed by it for a period of approximately a year and a half and there is no evidence that said respondent now has or has had a dominant part in the affairs of said respondent. For that reason the complaint wil be dismissed as to said indi vidual respondent and the ternl "respondents" as hereinafter llsed willnot incJnc1e said individual. Respomlents are now, and for more than three years last past have been, engaged in the nmnnfactnn of devices commonly known as push cards and pllnchboards, and in the sale and distribution of said device jo jobbers and dealers in various articles of merchandise in commerce between and among the various States of the United States, and t jobbers :md dealers in various art ides of merchandise and to operator of said devices Jocated in the various States of the United E'states. 4n:144:-3- ;17 - ......:1.L TRADE COMMISSION DECISIONS Findings 50 F. T. C.

Respondents cause and have caused said devices, when sold, to be Illinois totransported from their place of business in the State of purchasers thereof at their points of location in the various States of the United States other than Illnois. There is now and has been for more than three years last past a course of trade in such devices by said respondents in commerce between and among the various States of the United States.

PAR. 2. In the course and conduct of their said business, as described in Paragraph 1 hereof, respondents sell and distribute, and have sold and distributed, to said jobbers and dealers in merchandise 1ld to operators thereof, pushcards and punchboards so prepared and arranged as to involve games of chance, gift enterprises or lottery schemes when used in making sales of merchandise to the consuming public. Respondents sell and distribute, and have sold and distributed, many kinds of pushcards and punchboards, but all of said devices involve the same chance or lottery features and vary only in detail. Many of said pushcards and punchboards have a printed legend or instructions on the face thereof, commonly referred to as a label, which explains the manner in which said devices are to be used or may be used in the sale or distribution of merchandise. The prices of the sales on said pushcards and punchboards vary in accordance with the individual device. Each purchaser is entitled to one punch or push from the pushcard or punchboard, and when a push or punch is made, a disc or printed slip is separated from the pushcard or punch board and a number is disclosed. The numbers are effectively concealed from the pul' hasers and prospective purchasers until a selection has been made and the push or punch completed. Certain specified numbers entitle purchasers to designated articles of IYwrchandise. Persons securing lucky or winning numbers receive articles of merchandise without additional cost at prices which are much less than the normal retail price of said articles of merchandise. Persons who do not secure such lucky or winning numbers generally receive nothing for their money other than the privilege of making a push or punch from said card or ward. The articles of merchandise are thus distributed to thecollsumng or purchasing public wholly by lot or chance. Such punchboard devices, with printed labels providing for their 3e in connection with the distribution of merchaudise, are commonly ferred to as "merchandise boards. Respondents also sell and dislbute boards with printed labels which provide for the distribution cash amounts rather than merchandise to persons securing lucky winning numbers. The latter type of board is commonly referred IS a "money board.

EMPIRE PHESS , INC. , ET AL. 819 816 Finilngs and punchboard devices containing In addition to pushcard printed. labels with specific instructions regarding their use, either as merchandise boards or money boards, respondents also sell and distribute a substantial number of pushcards and punchboards with no instructions of legend thereon as to their use. Such boards with a blank label are commonly referred to as "plain boards." The purchasers thereof place their own labels or instructions thereon which are similar to the instructions or labels used by respondents. Such plain boards are sold by respondents to jobbers and wholesalers, who make up so-called "merchandise deals" consisting of assortments of various articles of merchandise together with said pushcard or punchboard devices, and prepare their own labels for use on said boards by the retailer to whom said assortment is sold. Such boards are also sold to peddlers and operators who prepare their own labels for use at the retail location where the boards are distributed on a sale, consignment, or percentage basis. The labels provide for the distribution of merchandise as prizes, such merchandise being either supplied by the peddler or operator who prepares the label or by the retailer who may have certain merchandise which is not moving rapidly enough. While the so-called phein boards are sometimes used to distribute cash prihes, this is the exception rather than the rule since a person desiring to use a money board can ordinarily purchase a board already prepared by the manufacturer with a printed label providing for stipulated cash prizes. Because of the variety of merchandise which dealers desire to sell or distribute it is more diffcult to prepare a standard merchandise board with a printed label suitable for diflerent types of merchandise. Hence dealers and operators make wide use of plain boards which permit them the desired latitude in making up labels suitable for the particular merchandise which they desire to sell or distribute at the time. The primary use made of such plain push cards and punchboards and the manner in wl1ieh they are normally and commonly used, by the ultimate purchasers thereof, is in combination with other merchandise so as to enable said ultimate purchasers to sell or distribute said other merchandise by means of lot or chance as hereinabove found.

PAIL 3. Many persons, firms and corporations who sell and distribute, and have sold and distributed, candy, cigarettes, clocks rawrs, wallets, firearms and other articles of merchandise in commerce between and among the various States of the United States purchase and have purchased respondents' said push card and punchboard devices, and pack and assemble, and have packed and assembled assortments comprised of various articles of merchandise together 820 FEDERAL TRADE COMMISSIOK DECISIONS Concl usion 50 F. T. C. with said pushcards and punch board devices. Retail dealers who have purchased said assortments, either directly or indirectly, have exposed the same to the purchasing public and have sold or distributed said articles of merchandise by means of said pushcards and punchboards in accordance with the sales plan, as described in Paragraph 2 hereof. Because of the element of chance involved in connection with the sale and distribution of said merchandise by means of said pushcards and punchboards, many members of the purchasing public have been induced to trade or deal with retail dealers sellng or distributing said merchandise by means thereof. As a result thereof, many retail dealers have been induced to deal with or trade with wholesalers jobber' , peddlers, and operators 'who cclllmd distribute said mcrchandise, together with said devices.

PAR. 4. The sale of merchandise to the purchasing public through the use of, or by means of, such devices in the manner above found involves a game of chance or the sale of a chance to procure articles of merchandise at prices much less than the normal retail price thereof and teaches and encourages gambling among members of the public all to the injury of the public. The use of said sales plan or methods in the sale of merchandise and the sale of merchandise by and through the use thereof, and by the aid of said sales plan or method is a practice which is contrary to an established public policy of the Government of the United States and in viobLion of crirninal Jaws, and constitute"s unfair acts and practices in said commerce. The sale or distribution of said push cards nne! punchbonrd devices by respondents, as hereinabove found, supplies to and places in the hands of others the means of conducting lotteries, games of chance, or gift enterprises in the sale or distribution of their merchandise. The respondents thus supply to, and place in the hands of, said persons firms, a:1d corporations the means of, and instrumentalities for, engaging in unfair acts and practices within the intent and meaning of the Federal Trade Commission Act.

COKCLTJSION The aforesaid acts and practices of respondents, as hereinabove found, are aU to the prejudice nne! inj lary of the public and constitute unhir acts and practices in commerce within the intent and meaning of the Federal Trade Commission Act.

Since the record discloses that respondents, on October 26, 1()50 entered into a stipulation and agreement to cease and desist from the use of met hods, acts, and practices substantially the same as, or similar to. those hereinabove found, and since the methods, acts, and prac- EMPIRE PRESS, INC. , ET AL. 821 816 Decision tices hereinaoove found are in violation of said stipulation and agreement to cease and desist, it is the conclusion of the examiner that there is a reasonable likelihood the remedial purposes of the Act will be thwarted unless the order issued herein is sufficiently broad to prevent the recurrence of such conduct in the future. The possibility of circumvention is particularly enhanced by the fact that respondents sell and distribute phlin push cards and punchboards which the record discloses are normally and commonly used in combination with merchandise rather than to distribute cash prizes. (See Feitlerv. F. T. C" 201 F. 2d 790, ccrt. denied, U. S. Sup. Ct., Oct. 12, 1953. ORDER I t is m'dered That respondents Empire Press, Inc., a corporation and its offcers and respondent Sylvea Zimmerman, individually and as an offcer of said corporation, and Joseph Zimmerman, individually, and their respective agents, representatives, and employees, directly or through any corporate or other device, do forthwise cease and desist from:

Selling or distributing in commerce as "commerce" is defined in the Federal Trade Commission Act, push cards, punchboards, or other lottery devices which are intended to be used or which, due to their design, are commonly and normally used in the sale or distribution of merchandise to the public by means of a game of chance, gift enterprise, or lottery scheme.

It is further ordered That the complaint herein be, and it hereby is dismissed as to respondent Evelyn Zimmerman. DECISION OF THE CO nssIoN This matter came before the Commission upon cross-appeals by counsel supporting the complaint and respondents from an initial decision prohibiting respondents Empire Press, Inc., Sylvea Zimmerman and Joseph Zimmerman from:

Selling or distributing in commerce as 'commerce' is defined in the Federal Trade Commission Act, push cards, punchboards, or other lottery devices which are intended to be used or 'which, due to thd1' design, are commonly and n01'1nally used in the sale or distribution of merchandise to the public by means of a game of chance, gift enterprise, or lottery scheme. (Italics supplied. The complaint was dismissed as to respondent Evelyn Zimmerman. Both parties in their appeals object to the portion of the order in the initial decision which is italicized above. Both request the Commission to modify this order to conform to the order approved by the Decision 50 F. T. C.

courts in United States Printing and Novelty 00., Inc. , et al. v. Federal Trade Oommission 204 F. 2d 737 (C. , D. C. 1953) and Hamilton Manufacturing 00. v. Federal Trade Oommission 194 F. 2d 346 (C. D. C. 1952). The change in the order desired by the parties would strike the above italicized words from the order and substitute for them the words "designed or intended to be. This modification would conform the order to those which are currently being issued by the Commission in similar cases and which have been approved hy the courts. Such modification would be proper in all respects in this matter and should be granted. Either form of order would prohibit the sale of push cards or punchboards labeled as merchandise boards or sold for use as merchandise boards.

Respondents' only other contention in their appeal is that they take exception to the finding in the initial decision to the effect that many of respondents' push cards and punchboards have a printed legend or instructions on their face which explain the manner in which they are to be used or may be used in the sale of specified articles of merchandise. Ilespondents contend that with the possible exception of a cigarette board there is no card or board in evidence which has a label explaining how it is to be used in the sale of specified articles of merchandise.

The record contains two labels for pUllchboards which explain how they are to be used in the sale of cigarettes. III addition, it contains two of respondents' catalogs which specifically advertise certain of their punchboards as "merchandise boards. Illustrations of certain of these boards show that their labels explain how they are to be used t.o sell merclmndise although the type of merchandise to be sold is not specified. Thus strictly construed, the excepted to finding should be modified by striking from it the words "various specified articles of. This inconsequential modification in the findings, however, in no way changes the conclusion in this case that respondents' acts and practices as found are in violation of the Federal Trade Commission Act.

The Commission being of the opinion that the findings as to the facts and order in the initial decision should be modified as hereinabove indicated and that as so modified it is appropriate in all respects to dispose of this proceeding:

It is ordered That the appeals of counsel supporting the complaint and of respondent are hereby granted to the extent hereinabove indicated.

It is fUffther ordered That the initial decision is hereby modified by striking from the first sentence of the second paragraph of Paragraph 2 of the findings as to the facts the words "various specified EMPIRE PRESS, INC., ET AL. 823 81G Order articles of" ; that as so modified the findings as to the facts and conclusion in the initial decision are hereby adopted as the findings and conclusion of the Commission; and that in lieu of the order contained in the initial decision the Commission issues the following as its order to cease and desist.

ORDER It is ordered That respondents Empire Press, Inc., a corporation and its offcers and respondent Sylvea Zimmerman, individually and as an offcer of said corporation, and Joseph Zimmerman, individually, and their respective agents, representatives, and employees, directly or through any corporate or other device, do forthwith cease and desist from:

Selling or distributing in commerce as "commerce" is defined in the Federal Trade Commission Act, push cards, punchboards, or other lottery devices which are designed or intended to be used in the sale or distribution of merchandise to the public by means of a game of chance, gift enterprise, or lottery scheme. It is jurther ordered That the complaint herein be, and it hereby , dismissed as to respondent Evelyn Zimmerman. It is j'wrther ordered That the respondent shall, within sixty (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. Decision 50 F. T. C.