Dallas Hosiery Mills, Inc.

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IN THE MATTER OF DALLAS HOSIERY MILLS, INC., ET AL.

CONSENT Order., ETC. , IX REGARD TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE CO::DnSSION AXD THE WOOL PU.OD"'CTS LABELING ACTS Docket 7600. Compla'l, Sept. 1959-Decision, Apl' , 1961 Consent order requiring manufacturers in Dallas, Ga. , to cease violating the Wool Products Labeling Act by tagging men s hosiery as "100% WOOL SOLE CliSHIOIG:;T TOP, BODY ALL CO'.rton" when the soles of such Vroc1ucts contained substantially less than 100% wool, and by failng to label recognizably distinct sections as required. CO:\IPLAINT Pursuant to the provisions of the Federal Trade Commission Act and the 'Wool Products Labeling Act of 1939, and by virtue of the authority vest.cd jn it by said Act, the Federal Trade Commission having reason to believe that Dallas Hosiery 11iJl8, Inc., a corporation DALLAS HOSIERY MILLS , INC. ) ET AL. 581 580 Opinion and Ernest L. Burch, individually and as an offcer of said corporation, hereinafter referred to as respondents, have violated the provisions of said Acts and the Rules and Regubt.ions promulgated under the "Wool Products Labeling Act, 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:

PARAGRAPH 1. Respondent Dallas I-Iosiery l\.fills, Inc., is a corporation organized, existing and doing business under and by virtue of the laws of the State of Georgia. Respondent Ernest L. Burch is President and a Director of the corporate respondent. Said individual respondent formulates, directs and controls the acts, policies and practices of the corporate respondent, including the acts and practices herein referred to. All respondents have their offce and principal place of business at Dallas Hosiery Mils, Inc., Main Strect Dallas, Georgia.

PAR. 2. Subsequent to the effective date of the "Wool Products Labeling Act of 1939 and more especially since 1957, respondents have manufactured for introduction into commerce, introduced into commerce, sold, transported, distributed, delivered for shipment and offered for sale in commerce, ft.S "commerce" is dei-ined in said Act wool products as "wool products " are defined therein. PAR. 3. Certain of said wool products were misbranded by respondents within the intent and meaning of Section 4(a) (1) of the Wool Products Labeling- Act of 1939 and the Rules and Regulations promulgated thereunder in that they were falsely and deceptively stamped, tagged or labeled with respect to the character and amount of the constituent fibers contained therein. Among such misbranded wool products were men s hosiery stamped, tagged or labeled by respondents a.s:

100% WOOL SOLE CUSHIONING TOP, BODY ALL COTTON Through the use of such identifications the respondents represented tlmt said wool products were composed of cotton except for the soles thereof which portions were represented as consisting of 100% wool whereas in truth and in fact, the wool content of these portions said wool products was substantjally less than 100%. PAR. 4. Certain of said wool products were further misbranded by respondents in that they were not stamped, tagged or labeled as required under the provisions of Section 4(a) (9) of the Wool Products Labeling Act and in the manner and form prescribed by the Rules and Regulations promulgated under the said Act. 582 FEDERAL TRADE COJ\fMISSION DECISIONS Opinion 58 P.

PAR. 5. Certain of said wool products were further misbranded in violation of the 'W 001 Products Labeling Act in that they were not labeled in aecorclance with the Rules and Regulations promulgated thereunder in that they failed to disclose, by sections which are recognizably distinct, the fiber content required to be stated upon the stamp, tag, label or other Incans of identification in such a manner as to show the fiber composition of each section in violation of Rule 23 of the Rules and Regulations pronmlgated under the IV 001 Products Labeling Act.

Among such inisbranc1ed wool products were l1'len S hosiery stamped, tagged or labeled as follows:

100% WOOL SOLE CeSTIIONING TOP, BODY ALL COTTON Through the use of such identification the respondents represented that the soles of said hose were composed of 100% wool, whereas, in truth and in fact, the wool content. of that portion of said wool products was substantially less than 100%. PAn. 6. Respondents in the course and conduct of their business as aforesaid and as hereina:fer set forth \Were and are in competition in commerce with other corporations: firms and indi"Viduals likewise enga,gec1 in the manufacture and sale of hosiery containing wool. PAR. 7. The aforesaid acts and practices of respondents were, and are in violation of the IV 001 Products Labeling Act of 1939 and the Rules and H.e llbtions promulgated thereunder and constituted: and now constitute, unfair methods of competition and unfair and deceptive acts and practices, in commerce, within the intent and meaning of said Act.

PAR. 8. In the course and conduct of their business as aforcsaid respondents have made various statements concerning their said products on sales invoices and shipping memorfmc1n covering shipments of their said products in commcrcc. Among a,nel typical but not all inclusive of sllch statements are the following: "Transfer to read: #1 transfer. 100% IVOOL CUSHION SOLE 650/ COTTOX, 35% WOOL.

PAR. 9. The aforesaid statements \Were false, misleading and deceptive since, in truth and in fact, respondents' product. represented as 05% cott.on, 35% wool, 100% wool cushion sole, contained no wool except for the sole thereof ancl the "001 content of that portion of said wool product was substantially less than 1000/. Moreover, the percentage by weight of wool in sa.id product was substantially less than 35%.

, DALLAS HOSIERY MILLS ! INC. ) ET AL. 583 .580 Decision PAR. 10. The use by respondents of false, misleading and decepti ve statements and representa1ions on inyoiccs and shipping n1cmoranc1a as aforesaid had, and nmv has, the tendency and capacity to cause others to misrepresent such products to their customers. PAR. 11. The acts and practices of said respondents as hereinabove alleged in Paragraph Eight were all to the prejudice and injury of the public and responde,nts' competitors and constituted and now constit.ute unfair and deceptive acts and practices and unfair methods of competition, in commerce, within the intent and meaning of the Federal Trade Commission Act.

M1' . Oharles S. Cox for the Commission. Wright, Hogen, 11agnldeT Hoyt of Rome, Ga. , by 1l1r. D"dley B. 11 agndm' , JT. for respondents.

INITIAf.J DECISION BY EmVARD CHEEL, FIEARING EXAJIIXER The Federal Trade Commission issued its complaint against the above-named respondents on September 20, 1050, charging them with violation of the Federal Trade Commission Act and the Wool Products Labeling Act of 1939 in connection with the distribution or mle of wool products, including men s hosiery. On February 17, 1961 , there Wlth submitted to the undersigned hea.ring examiner an agreement between respondents, their counsel and counsel supporting the complai.nt providing for the entry of a consent order.

1Jnder the terms of the agreement, t.he respondents admit the jurisdictional.l fa.cts alleged in the complaint. The patties agre, among other things that the cease and desist order there set forth may be entered without further notice a.nd have the same force and effect a.s if entered after a full hearing, and the doeurnellt includes a waiver by the respondents of ftll rights to c.hallcngt Jr contest the validity of the order issuing in aecorcbnce there\with. The agreement further recites that it is for settlement purposes only and does not constitute an admission by the respondents that they have violated the law as a1Jeged in the complaint.

The hearing examiner finds that the content of the agreement meets all of the requirements of g3.25 (b) of the Rules of the Commission.

The hearing examiner having considered the agreement and proposed order, and being of the opinion that they provide an appropriate basis for settlement and disposition of this proceeding, hereby accepts the agreement, and it is orclered that saiel agreement shall not become a part of the offcial record unless and until it becomes 584 FEDERAL TRADE C01L'dISSION DECISIO:'S Order 58 F.

a part of the decision of the Commission. The following jurisdictional findings are made and the following order issued: 1. Respondent Dallas Hosiery lI1ils, Inc., is a Georgia corporation, and respondent Ernest L. BUTch is Presic1Emt and a Director of the corporate respondent. Said individual respondent formulates directs and controls the acts, practices and policies of the corporate respondent. AJI respondents have their offcc and principal place of business at Dallas Hosiery YEl1s, Inc., Main Street, Dallas, Georgia. 2. The Federal Trade Commission has jurisdiction of the subject matter of this proceeding and of the respondents, and the proceeding is in the public interest.

ORDER It i8 ordered That respondents Dallas Hosiery :Mills, Inc. , a corporation, and its offcers, a,nel Ernest L. Burch, individually, and as an offcer of said corporation, a,nd respondents' representatives agents, and employees, directly or through any corporate or other device, in connection with the introduction or Inanufacture for the introduction into commerce, or the offering ror sale, sale, transportation or distribution in commerce, as "commerce" is defined in the Federal Trade Commission Act and the .Wool Products Labeling Act of 1939, of hosiery composed in whole or in part of wool or other wool products, as such products are defined in and subject to the Wool Products Labeling Act of 1939 , do forthwith cease and desist from misbranding such products by: 1. Falsely or deceptively stamping, tagging, labeling or otherwise identifying such products as t.o the character or amount of the constituent fibers included therein.

2. Failing to affx labels to wool products showing each element of information required to be disclosed by Section 4(a) (2) of the 'Vool Products Labeling Act of 1939; provided, however, that the over-aU content of the wool products need not be give.n if such products are labeled in accordance with Rule 23 of the Rules and Regulations promulgated under said Act.

3. Failing to set forth on stamps, tags, Jabels or other means of identification attached to such products the information required under Section 4(a) (2) (A) of the Wool Products Labeling Act with respect to each specific" lly designated section of a wool product composed of two or more sections where such sections are of a different fiber composition and are recognizabJy distinct. 4. Falsely or deceptively designating the character or amount of the fibers contained in any section of a wood product composed of two or more sections which are recognizably distinct in violation of ELEC1'H.OXIC VIDEO ) I:\C. , ET AL. 585 580 Complaint Rule 23 of the Rules and Regulations promulgated pursuant to the Wool Products Labeling Act of 1939.

It is further ordered That the charges contained in Paragraph Ten of the complaint be, and the same hereby are, dismissed. DECISION OF THE COMMISSION AXD ORDRR TO FILE HEPORT OF CO:JIPLIA::'ICE Pursuant to Section 3.21 of the Commission s R.ules of Practice the initial decision of the hearing examiner shall, on the 13th day of April 1961, become the decision of the COlnmission; and, accordingly: It is ordered That respondents herein shall, within sixty (60) days after service upon th81Il of this order, file with the COlIlmissiol1 a report in writing setting forth in detail the manner and form in which they have complied with the order to cease and desist.