Plumrose, Inc.

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

IN THE L-\ TTER OF PLU IROSE, INC.

ORDER, ETC. , IX REGAIW TO THE ALLEGED VIOLATION OF SEC. 2 (d) OF THE CLAYTON ACT Docket 7753. G01nplaint, Jan. 25, 1960-orde/' , .June, 1961 Order dismissing for lack of jurisdiction-because, as the wholly owned subsidiary of a Copenhagen, Denmark, packer, respondent wholesaler was a packer as defined in the Packers and Stockyards Act of 1921-complaint charging a New York City importer of Danish canned meats with grant. ing discriminatory promotional allowances to customers in violation Section 2 (d) of the Clayton Act.

Mr. FTedric T. Suss, lift. Timothy J. CTonin, JT., lift. Philip F. Zeid1nan and Afr. Lynn G. Paltlson for the Commission. Moynihan Wach8smith by MT. Adh1lT Moynihan and Mr. Nicholas S. Vazza"a of Kew York, K.Y., for respondent. INITIAL DECISION nY AnxER E. LIPSCO::IH : I-IEAHING EXA:l\IIXER The complaint herein was issued on.J anuary 25 , 1960 , cha.rging the Respondent. with violating 2(d) of the Clayton Act as amended by the R.obinson-Patman Act, by paying to favored customers promotional or advertising allowances which were not made available to an other customers on proportionally equal terms. After counsel supporting the complaint had presented evidence , counsel for the Re-at several hearings and had rested their r case spondent, at the hearing held on Respondent's behalf in Washing- . ..

PLUMROSE , IKC. 1135 1134 Decision ton, D.C. on February 8 1D61 moved for the dismissal of the complaint herein on the ground that the Respondent is a packer, over whose alleged activities the Commission does not have jurisdiction. The motion was taken under consideration, and briefs were submitted by opposing counsel.

The evidence shows t.hat the Respondent is a New York corporation and a wholly-mmed subsidiary of P. & S. Plum, Ltd. , of Copenhagen, Denmark. The evidence sho-ws further that the parent corporation operates, in Denmark, a packing plant engaged in the canning of meat, and, through an affliate, also operates a slaughterhouse.

The Packers and Stockyards Act, 1021: as amended: insofar as it is applicable to P. & S. Plum, Ltd., Respondent' s parent corporation, defines a packer as:

.. .. any person engaged in the business " '" '" (b) of manufacturing or preparing meat or meat food products fot sale or shipment in commerce In the light of this definition, the parent corporation of the respondent is clearly t packed!' The Respondent herein, thc- wholly-owned subsidiary of the Danish corporation, is: however, not engaged in the packing of meats but is engaged in the sale and distriblltion at wholesale of the meats canned by its principal in Denmark and shipped to the Respondent in Kew York for slich sale and distribution. Because of these facts and the Hespondenes motion, hyo cpJestions arise: 1. Is the Respondent c.orporation a. packer within the meaning of the Packers and Stockyards Act, 1921 , as amended? 2. If the Respondent corporation is a pnekp1': does the Federn 1 Tra.de Commission have juridiction over its acts and practices as alleged in the complaint? The Packers and Stockyards Act, 17. C. Title 7 201, sets forth definitions of various persons 'iyho are classified as packers ior the purposes of that Act. The portion of 20l applicable here is as follows:

When used in this Act-The term "packer" mellns any person engaged in com-the hl1siness '" '" '" (d) of marketing meats, meat food products, .. .. in merce; '" '" fife Ij '" (3) Any interest in such *' *' marketing business is owned or controlled, '" '" by any person engaged in any business referred to in clause '" * (h) above; * * As we have seen hereinabove, clause (b) of the Act quoted is clearly applicable to the Respondent's parent cOl'pomti:m. 1136 FEDERAL TRADE CmnnSSION DECISIO~S Order 58 F.

Since the Respondent is the wholly-owned subsidiary of a packer according to the above definition the Respondent must itself be classified as a packer.

In ) 958 the Packers and Stockyards Act and the Federal Trade Commission Act were amended to extend the jurisdiction of the Federal Trade Commission:

(3) Over an transactions in commerce in margarine or oleomargarine and over retail sales of meat, meat food products, livestock products in unmanu. factured fOfm, and poultry products (emphasis supplied). The Commission interpreted the above amendments, in the ::latter of Renaire Corporation (Pennsylvania), ct. a1. , Docket No. 6555 , as conferring:

* * * on the Commission jurisdiction over unfair practices in commerce, in connection with all transactions by packcrs involving (1) commodities other than livestock, meats, meat food products, livestock products jn unmanufactured form, poultry or poultry products and (2) with exceptions not here material retail sales by packers of all products (emphasis suppliell). "Vi thin the meaning of this interpretation, the applicable amendment of the Federal Trade Commission Act clearly limits the Commission s jurisdiction over packers to :: retail sales The evidence shows that the Respondent herein is not engaged in selling at retail, but is engaged exclusively in the business of selling and distributing meats at "Kholesale. "Vc must therefore conclude that the Federal Trade Commission docs not have jurisdiction oyer the ads and practices of t.his Respondent as alleged in the complaint. Accordingly, It is O1'dered That the complaint herein be, and the same hereby , dismissed.

FINAL ORDER The date on which the hearing examiner s initial decision would have become the decision of the Commission having been extended by order issued J\Iay 9, 1961, until further order of the COlnmission; and The Commission having now det.ermined that said initial decision is appropriate :

It ,is ordered That the initial decision of the hearing examiner providing for dismissal of this proceed1jng for bek of jurisdiction , and it hereby is, mloptec1 as the decision of the Commission. , , , .

REVILLON WHOLESALE , INC. , ET AL. 1137 1137 Complaint Ix THE 1\11A'IER OY REVILLON WHOLESALE, INC., ET AL.

CONSENT OlWER, ETC. , IN HEGAHD TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE COMJ\fISSION AXD THE YL PRODUCTS LABELING ACTS Docket 8265. Comp ai. , Dec. 30, 1960-Decision, June, 1961 Consent order requiring New York City furriers to cea' se violating the Fur Products Labeling Act by setting forth on invoices and in advertising fictitious prices for fur products; by failng to keep adequate records on which pricing and value claims were based; by failng in other respects to comply with invoicing and advertising requirements; and by furnishing false guaranties that certain of their fur products were not misbranded, falsely invoiced, and falsely advertised. Co::rPLAIXT Pursuant t.o the provisions of the Federal Trade Commission Act and the Fur Products Labeling --\ct, fmd by virtue of the authority vested in it by said Acts, the Federal Trade. Commission, having reason to believe that Revil10n 'Yholesale, Inc. , a corporation, and Emil 'Yendling, Abraham Grauer, Herman Grauer Jacques Haran Marty Weinstein and Peter \Venzcl, inc1ivic1ua11y and as officers said corporation, hereinafter refenec1 Lo as respondents, hayc violated the provisions of said Acts and the Hules and Hegulations promulgate.d under the Fur Products Labeling Act: and it appearing to the Corn mission that a proceeding by it in respect thereof would be in the public interest, l1ereby issues its complaint stating its charges in that respect as follmvs:

PARAGJL\PII 1. Hevillon \Vholesale, Inc. is fl corporation organized, existing and doing business under and by virtue of the laws of the State of el,Y York, with its office find principal place of business located at 352- 334 Seventh Avenue, Ne - York, ?-;e\v York. Emil 'Vendling, Abrahnm Graucr, I-1e1'11al1 Grauel' Jacques I-Iaran, :Marty \V cinstein: and Peter \Venzel are offcers of the said corporate respondent. These individuals c-control: fonnnlate and direct the ads, pl'flctices flnd policjes of the sflid corporate respondent. Thejr offce flncl principal1 place of busincs,'J is the S lme as that of the corporate respondent.

PAIL 2. Subsequent to the effective dale of th( Fur Products L: beling ;\.ct on Angnst 0 , 1052: respondents have. beell find arc HOW engngec1 in the introduction into c.olTlTJerce: and in the sale, advertising find oilerillg lor sale, in commerce, and in the transportation Gkl-237--G3-- , 1138 FEDERAL 'IRADE COMMISSION DECISIONS Complaint 58 F. T.

and distribution in commerce or fur products; and have sold, advertised, offered for sale, transported and distributed fur products which have been made in whole or in part or fur which had been shipped and received in commerce.e, as the terms ':commerce fur and "fur product" arc defined in the Fur Products Labeling Act. PAR. 3. Certain of said fur products were falsely and deceptively invoiced by respondents in that they were not invoiced as required by Section 5(b) (1) of the Fur Products Labeling Act. and in the manner and form prescribed by the Rules and Regulations promulgated thereunder.

PAR. 4. Cerhtin of said fur products were falsely and deceptively invoiced in that the respondents 3d out on invoices certain prices of fur products .which were in fact fictitious in violation of Section 5(b) (Q) of the Fur Products Labeling Act. PAR. 5. Certain of said fur products were falsely and deceptively advertised in that the respondents made representations and gave notices concerning said fur products, which representations and notices were not in accordance wjth the provisions of Section 5 (a) of the Fur Products Labeling Act and the Rules mlc1 H.egulations promulgated thereunder; and which representat ions and notices \"ete intended to aid, promote and assist, directly or indirectly, in the sale, and offering for sale of said fur products. By means of said representations and notices and by means of other repreSeJltations and notices of similar import and meaning not specifically referred to herein, respondents falsely and dece.ptiveJy advertised fur products in that respondents thereby made representations as to the prices of fur products ,"which prices were in fact fictitious in violation of Section 5(a) (5) of thc Fur Products Labc1ing Act.

\R. 6. In advertising fur products for sale as aforesaid respondents made claims and representations respecting the prices find values of fur products. H,esponc1ents in making such claims and representations failed to maintain fun and nc1cquflte records disclosing the facts upon which such claims and representations were based in violation of Rule 4'(e) of said Hules ami Regulations. PAR. 7. Respondents furnished false guaranties that certain of their fur products were not misbranded, falsely invoiced and falsely advertised when respondents in furnishing such guaranties had reason to believe the fur products so falsely guaranteed would be introduced, sold, transported or distributed in commerce, in violation of Section 10 (b) of the Fur Produeis Labeling Act. PAH. 8. The aforesaid acts and practices of respondents, as herein alleged, are in violation of the Fur Products Labeling Act and the REVILLON WHOLESALE , INC., ET AL. 1139 1137 Decision Rules and Regulations promulgated thereunder and constitute unfair and deceptive acts and practices, in commerce, under the Federal Trade Commission Act.

Mr. Cha.rules W. O' Connell for the Commission. Respondents for themselves.

INITIAL DECISION BY LOREX H. LABGHLnr, IIEARING EXAMINER The Federal Trade Commission (sometimes also hereinafter referred to as the Commission) on December 30, 1960, issued its complaint herein, charging the above-named respondents with having violated the provisions of the Federal Trade Commission Act, and of the Fur Products Labeling Act and the Rules and Regulations promulgated thereunder, in certain particulars, and respondents were duly served with process.

On April 21 , 1961, there was submitted to the undersigned hearing exa,miner of the Commission, for his consideration and approval an "Agreement Containing Consent Order To Cease and Desist" which had been entered into by and between respondents and counsel snpporting the complaint, IllHler date of Ai)lil 17 , 1961, subject to the approval of the Bureau of Litigation of the Commission which had subsequently duly approved the same. On due consideration or such agreement, the hen,ring examiner finds that said agreement, both in form and in content, is in accord with 83.25 or 1.he Commission s Rules or Practice for Adjudicative Proceedings, and that by said agreement the parties have specifically agreed to the following mfttters:

1. Respondent Hevi1on .Wholesale, Inc., is a corporation existing and doing business under and by virtue of the Jaws of the State of New York, with its offce and principal place or business located at 352- 354 Seventh Avenue, New York, New York. Respondents Abraham Grauer, I-Ierman Grauer, Jacques I-Iaran :Marty \Veinstein and Peter "'Vensel, erroneously named in the complaint as Peter \Venzel, are offcers of the corporate respondent. They control formulate and direct the acts, practices and policies or the corporate respondent. Their address is the same as that or the corporate respondent.

2. Hespondents admit all the jurisdictional facts alleged in the complaint and agree that the record may be taken as if findings of jurisdictional facts had been duly made in accordance -with such allegations.

3. This agreement disposes of all of this proceeding as to all parties. It is recommended that the complaint be dismissed as to 1140 FEDERAL TRADE COM:'vISSION DECISIONS Decision 58 F.

respondent Emil "Wendling, individual1ly and as an offcer of said corporation, :for the reason that he is no longer an offcer or said corporation and has retired from business, as is more fully set forth in the affdavit which is attached hereto and made part hereof. 4. Respondents waive:

(a) Any furt.her procedural steps before t.he hearing exominer and the Commission;

(b) The making of findings of fact or conclusions of Jaw; and (c) A1I of the rights they may have to cha1lengc or contest the validity or the order to cease and desist entered in accordance with this agreement.

5. The record on which the initial decision and the decision of the Commission shall be based shall consist solely of the complaint and this agreement.

6. This agreement shall not become a part of 1he offcial record unless and until it becomes a part of the decision of the Commission. 7. This agreement is for settlement purposes only and does not. constitute an admission by respondents that they have violated the law as alleged in the complaint.

8. The following order to cease', and desist may he entered in this proceeding by the Commission without further notice to respondents. '''hen so entered it shan have the same force and effect as if entered after a fun hearing. It may be altered, modified or set aside in the manner provided for other orders. The complaint may be used in construing the terms of the order.

Upon due consideration of the complaint filed herein and the said Agreement Containing Consent Order To Ceflse And Desisf' , the hearing examiner approyes and accepts this agreement, and iinds that the Commission has jurisdiction of the subject-matter of this proceeding and of the respondents herein; that the complaint states a legal cause for complaint under the Federal Trade Commission Act, and under the Fur Pro(luels Labeling ct and the Rules and Regulations promulgated thereunder, against all respondents except Emil ,Vendling, both generally and in each of the particlllars alleged therein; that as to respondent Emil ,Vendling, the complaint herein should be dismissed, as prm-icled for in the flgreement; that this proceeding is in the interest of the pub lie; that the order proposed in said agreement is appropriate fot the just disposition of all the issues in this proceeding as to all of the parties hereto; and that sa, vrder therefore should be, ancl hereby is, entered as follo\Ys: It is ordered That respondents Revillon ,Yholcsa!e Inl. , a corporation, and its offcers, and Abraham Grauer, Herman Grauer , REVILLON WHOLESALE , INC. , ET AL. 1141 1137 Decision Jacques Haran, Marty "Weinstein, and Peter Wensel, individually and as offcers of said corporation, and respondents' representatives agents and employees, directly or through any corporate or other device, in connection with the introduction into commerce, or the sale, advertising or offering for sale, transportation or distribution in commerce of fur products; or in connection with the sale, advertising, offering for sale, transportation or distribution of fur products which have been made in whole or in part of fur which has been shipped and received in commerce, as "commerce fur" and fur product" are de.ined in the Fur Products Labeling Act, do forthwith cease and desist from:

A. Falsely or deceptively invoicing fur products by: 1. Failing to furnish to purchasers of fur products invoices showM ing all of the information required to be disclosed by each of the subsections of S5(b) (1) of the Fur Products Labeling Act; 2. Representing, directly or by implication, on invoices that the former or regular price of any fur product is any amount which is in excess of the price at which respondents hane formerly, usually or custom;trily sold such products in the recent regular course of business;

B. Furnishing a. false guaranty that any fur or fur product is not misbranded, falsely invoiced, or falsely advertised, when the respondents have reason to believe that such fur or fur product may be introduced, sold, tra.nsported or distributed in commerce; C. Falsely or deceptively advertising fur products through the use of any advertisement, representation, public announcement, or notice which is intenc1ed to aid, promote or assist, directly or indirectly, in the sale or offering for sale of fur products, and which: 1. Represents, directly or by implication, that respondents' usual and customary price of any fur product is any amount which is in excess of the price at which respondents have usually and customarily sold such products in the recent regular course of business; 2. 1\1isrepresents in any manner the savings available to purchasers of respondents' fur products;

D. .taking claims and representations respecting prices and values of fur products unless respondents ma.intain full and adequate records disclosing the facts upon which such claims and representations are based.

It is fw,thel' ordered That the complaint. herein be, and the same hereby is, dismissed as to respondent Emil "Wendling, individually and as an offcer of said corporation.

1142 FEDERAL TRADE COMMISSIO~ DECISIONS Complaint 58 F. T.

DECISION OF THE CO BIISSION AND ORDER TO FILE REPORT OF COMPLIANCE Pursuant to Section 3.21 of the Commission s Rules of Practice the initial decision of the hearing examiner shall, on the 27th day of June, 1961, become the decision of the Commission; and, accordingly:

It is ordered That respondents Revillon "Wholesale, Inc. , a corporation, and Abraham Grauer, I-Ierman Grauer, Jacques Haran Marty 'Yeinstein, Rnd Peter \Vensel, erroneously named in the complaint as Peter \Yenzel, 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