L. T. Baldwin doing business as Baldwin Gas Products Company

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In Tue MatrTer or L. T. BALDWIN DOING BUSINESS AS BALDWIN GAS PRODUCTS COMPANY CONSENT ORDER, ETC., IN REGARD TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSION ACT Docket 8405. Complaint, May 24, 1961—Decision, Oct. 24, 1961 Consent order requiring a St. Louis, Mo., distributor of water heaters to cease representing falsely in brochures, circulars, and other media, which he also furnished to retailers of his products, that his water heaters were unconditionally guaranteed for five years or one year without disclosing that there were various limitations imposed; and to cease using fictitious list prices for proration after the unconditional guarantee period. ComMPLAINT Pursuant to the provisions of the Federal Trade Commission Act, and by virtue of the authority vested in it by said Act, the Federal Trade Commission, having reason to believe that L. T. Baldwin, an individual doing business as Baldwin Gas Products Company, hereinafter referred to as respondent, has violated the provisions of said 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: Paracrary 1. Respondent L. T. Baldwin is an individual trading and doing business as Baldwin Gas Products Company, with his office Complaint 59 F.T.C.

and principal place of business located at 1401 Macklind, St. Louis, Missouri.

Par. 2. Respondent is now, and for more than two years last past has been, engaged in the advertising, offering for sale, sale and distribution of water heaters. Respondent ships, and causes to be shipped, his said water heaters, when sold, from the State of Missouri to purchasers thereof, many of whom are located in various other States of the United States. Respondent maintains, and at all times mentioned herein has maintained, a substantial course of trade in said product, in commerce, as “commerce” is defined in the Federa] Trade Commission Act.

Par. 3. In the course and conduct. of his business, and for the purpose of inducing the sale of his product, respondent has made certain statements and representations in brochures, circulars, folders, and other media, which he also furnishes to retailers of his product. Among and typical, but not all inclusive, of the statements and representations so made are the following:

Baldwin 10 year* Heavy Duty Automatic Gas Water Heaters Genuine Glasslined Tanks.

* .. For domestic use—5 years unconditional, and sixth to tenth year pro-rated... .

All Bhott Standard Weight Automatic Gas Water Heaters are unconditionally warranted for one full year, when properly installed according to local plumbing codes and ordinances.

Par. 4. Respondent, through use of the aforesaid statements and representations and others similar thereto, represents, directly and by implication, that his “10 Year Heavy Duty Automatic Gas Water Heaters” are unconditionally guaranteed for a period five years and his “Bhott Standard Weight Automatic Water Heaters” are unconditionally guaranteed for one year, if installation conforms with local plumbing codes and ordinances.

Par. 5. Said statements and representations were false, misleading and deceptive. In truth and in fact, neither of said water heaters is unconditionally guaranteed for the represented periods, as there are various limitations, conditions and requirements imposed in connection with the guarantees that are not disclosed in the advertising. Moreover, the proration in connection with the Heavy Duty Water Heater is based upon fictitious list prices. Par. 6. Respondent, in many cases, fails and refuses to perform under the terms of his written guarantees where his product covered by the guarantee has failed during the period of the guarantee and he has been notified of such failure.

Par. 7. Respondent, at all times mentioned herein, has been, and BALDWIN GAS: PRODUCTS CO. 977 975 Decision now is, in substantial competition, in commerce, with corporations, firms and individuals engaged in the sale of water heaters. Par. 8. The use by respondent of the aforesaid false, misleading and deceptive statements, representations and practices has had, and now has, the capacity and tendency to mislead members of the purchasing public into the erroneous and mistaken belief that said statements and representations were, and are, true and into the purchase of substantial quantities of respondent’s product by reason of said erroneous and mistaken belief. As a consequence thereof, substantial trade in commerce has been, and is being, unfairly diverted to respondent from his competitors and substantial injury has thereby been, and is being, done to competition in commerce. Par. 9. The aforesaid acts and practices of respondent, as herein alleged, were, and are, all to the prejudice and injury of the public and of respondent's competitors and constituted, and now constitute, unfair and deceptive acts and practices and unfair methods of competition, In commerce, within the intent and meaning of the Federal Trade Commission Act.

Mr. William A. Somers supporting the complaint. Mr, FF. William Human, Jr., of Ziercher, Tzindery, Human & Michenfelder, Clayton, Mo., for respondent. Intra, Deciston py Wattrer K. Bennerr, Hrartnc Examiner On May 24, 1961, the Federal Trade Commission issued a complaint charging that the above-named respondent had violated the provisions of the Federal Trade Commission Act. The complaint alleged that, in the course and conduct of his business and for the purpose of inducing the sale of his product, respondent had made certain statements and representations which were false, misleading and deceptive. On July 20, 1961, respondent, his counsel and counsel supporting the complaint entered into an agreement authorizing the entry of a consent order to cease and desist the practices charged without further notice. Said agreement was duly approved by the Director and the Acting Chief of the Bureau of Deceptive Practices. The hearing examiner finds that said agreement includes all of the provisions required by Section 3.25(b) of the Rules of the Commission, thatis:

A. An admission by respondent of all jurisdictional facts alleged in the complaint.

B. Provisions that:

(1) The complaint may be used in construing the terms of the order ; (2) The order shall have the same force and effect as if entered after a full hearing;

693-4 90—64 68 Order 59 F.T.C.

(3) The agreement shall not become a part of the official record of the proceeding unless and until it becomes a part. of the decision of the Commission.

(4) The entire record on which any cease and desist order may be based shall consist: solely of the complaint and the agreement; (5) The order may be altered, modified, or set. aside in the manner provided by statute for other orders;

C. Waivers of :

(1) The requirement that the decision must contain a statement of findings of fact and conclusions of law;

(2) Further procedural steps before the hearing examiner and the Commission, (3) Any right to challenge or contest the validity of the order entered in accordance with the agreement. In addition the agreement contains the following provision: A statement that the signing of said agreement is for settlement purposes only and does not constitute an admission by respondent. that he has violated the law as alleged in the complaint. Having considered said agreement, including the proposed order, and being of the opinion that it provides an appropriate basis for settlement and disposition of this proceeding; the hearing examiner hereby accepts the agreement but orders that it shall not become a part of the official record unless and until it becomes a part. of the decision of the Commission.

The following jurisdictional findings are made and the following order issued :

1. Respondent L. T. Baldwin is an individual trading and doing business as Baldwin Gas Products Company, with his office and principal place of business located at 1401 Macklind, St. Louis, Missouri. 2. The Federal Trade Commission has jurisdiction of the subject matter of this proceeding and of the respondent. ORDER Lt ts ordered, That respondent L. T. Baldwin, individually and doing business as Baldwin Gas Products Company, or under any other name, and respondent's representatives, agents and employees, directly or through any corporate or other device, in connection with the offering for sale, sale and distribution in commerce, as “commerce” is defined in the Federal Trade Commission Act, of water heaters, or any other product, do forthwith cease and desist from: 1. Representing, directly or by implication, that a product is guaranteed unless the nature and extent of the guarantee and the manner in which the guarantor will perform thereunder are clearly disclosed. ARCTIC LIGHT BLANKET CO., INC., ET AL. 979 975 Complaint 2, Representing, directly or by implication, that a product is sold under a guarantee unless the terms of the guarantee are strictly complied with.

3. Using fictitious list prices or any other fictitious prices in pro rata adjustment of guarantees.

DECISION OF THE COMMISSION 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 24th day of October, 1961, become the decision of the Commission; and, accordingly:

It is ordered, That respondent herein shall, within sixty (60) days after service upon him of this order, file with the Commission a report in writing setting forth in detail the manner and form in which he has complied with the order to cease and desist. In Tue Marrer or ARCTIC LIGHT BLANKET CO., INC. ET AL.

CONSENT ORDER, ETC., IN REGARD TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSION AND THE WOOL PRODUCTS LABELING ACTS Dochet &426. Complaint, June 2, 1961—Decision, Oct. 24, 1961 Consent order requiring Worcester, Mass., manufacturers to cease violating the Wool Products Labeling Act by such practices as labeling as 100% wool, blankets which contained a substantial quantity of reprocessed Wool and other fibers, and by failing to disclose on blanket labels the presence of reprocessed wool and non-woolen fibers and the percentage thereof. Complaint Pursuant to the provisions of the Federal Trade Commission Act and the Wool Products Labeling Act of 1939, and by virtue of the authority vested in it by said Acts, the Federal Trade Commission, having reason to believe that Arctic Light Blanket Co., Inc., a corporation, and Philip F. Goldberg, individually and as an officer of aid corporation, hereinafter referred to as respondents, have violated the provisions of said Acts and the Rules and Regulations 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:

Paracrary 1. Respondent Arctic Light Blanket Co., Inc., is a corporation organized, existing and doing business under and by virtue Complaint 59 F.T.C.

of the laws of the State of Massachusetts. Individual respondent Philip F. Goldberg is president and treasurer 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 hereinafter referred to. Both respondents have their office and principal place of business at 1 Fay Street, Worcester, Massachusetts.

Par. 2. Subsequent to the effective date of the Wool Products Labeling Act of 1939, and more especially since January 1958, respondents have manufactured for introduction into commerce, introduced into commerce, sold, transported, distributed, delivered for shipment and offered for sale in commerce, as “commerce” is defined in the said Act, wool products, as “wool products” are defined therein. Par. 3. Certain of said wool products were misbranded by the respondents within the intent and meaning of Section 4(a) (1) of the Wool Products Labeling Act and the Rules and Regulations promulgated thereunder, in that they were falsely and deceptively labeled or tagged with respect to the character and amount. of the constituent fibers contained therein.

Among such misbranded wool products were blankets labeled or tagged by respondents as 100% wool, whereas in truth and in fact said products contained a substantial quantity of reprocessed woo] and fibers other than wool.

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) (2) of the Wool Products Labeling Act and in the manner and form as prescribed by the Rules and Regulations promulgated under said Act. Among such misbranded wool products, but not limited thereto, were blankets with labels which failed: (1) to disclose reprocessed wool and other nonwoolen fibers present, and (2) to disclose the percentage of such reprocessed wool and other fibers.

Par. 5. Respondents in the course and conduct of their business as aforesaid, were and are in competition in commerce with other individuals, corporations, and firms likewise engaged in the manufacture and sale of wool products.

Par. 6. The acts and practices as set forth in Paragraphs Three and Four were and are in violation of the Wool Products Labeling Act of 1939, and the Rules and Regulations promulgated thereunder, and constituted, and now constitute, unfair and deceptive acts and practices and unfair methods of competition in commerce within the intent and meaning of the Federal Trade Commission Act. ARCTIC LIGHT BLANKET CO., INC., ET AL. ‘981 979 Decision Par. 7. In the course and conduct. of their business, as aforesaid, respondents have made various statements concerning their products in sales invoices. Among and typical of said statements is the following:

100%. wool Par. 8. The aforesaid representations and statements set out in Paragraph Seven were and are false, misleading and deceptive. In truth and in fact, respondents’ said products were not composed of 100% wool, but contained substantial amounts of fibers other than wool.

Par. 9. The acts and practices of respondents as set out in Paragraph Seven of falsely identifying the constituent fibers of its wool products have had and now have the tendency and capacity to mislead and deceive the purchaser of said products as to the true fiber content thereof.

Par. 10. The acts and practices of respondents, as alleged in Paragraph Seven above, are all to the prejudice and injury of the public and of respondents’ competitors, and constituted, and now constitute, unfair and deceptive acts and practices and unfair methods of competition in commerce within the intent and meaning of the Federal ‘Trade Commission Act.

Mr. Michael P. Hughes, supporting the complaint. Respondents, pro se.

Tnirtau Decision By Watrer K. Bennerr, Hearing Examiner The Federal Trade Commission issued its complaint against respondents on June 2, 1961, charging violation of the Federal Trade Commission Act and the Wool Products Labeling Act. The complaint charged respondents with both mislabeling and failing to properly label wool products and with issuing false and misleading statements concerning such products.

On August 22, 1961, counsel supporting the complaint presented an agreement dated August 14, 1961, and executed by him and by respondent corporation and by the individual respondent. Said agreement provided for the entry of an order on consent without further notice and was duly approved by the Chief, Division of Enforcement, the Acting Director and the Assistant. Director of the Bureau of Textiles and Furs.

Thes 1 6 3 1 2 710 2608 142 41 96.295959 hearings 1 6 3 1 3 868 2606 170 33 96.630829 examiners 1 6 3 1 4 1055 2605 87 32 96.943802 finds5 1 6 3 1 5 1159 2605 78 30 95.448479 that.5 1 6 3 1 6 1252 2604 72 31 95.448479 said5 1 6 3 1 7 1341 2608 191 36 96.642845 agreements 1 6 3 1 8 1548 2602 151 31 96.900543 includes5 1 6 3 1 9 1715 2601 44 31 95.477928 all5 1 6 3 1 10 1777 2600 38 31 96.778160 of5 1 6 3 1 11 1830 2600 56 30 97.012604 thea 1 6 3 2 0 581 2653 1305 52 -1 5 1 6 3 2 1 581 2663 190 42 97.000023 provisions5 1 6 3 2 2 783 2661 154 42 96.988533 required5 1 6 3 2 3 949 2660 43 41 96.948456 by5 1 6 3 2 4 1005 2659 133 33 93.255829 Sections 1 6 3 2 5 1154 2657 132 41 86.975983 3.25(b)5 1 6 3 2 6 1305 2658 36 31 96.991257 of5 1 6 3 2 7 1353 2658 57 31 96.989540 thes 1 6 3 2 8 1421 2656 103 32 96.369560 Rules5 1 6 3 2 9 1537 2656 38 30 96.866928 of5 1 6 3 2 10 1585 2656 58 31 96.851006 thes 1 6 3 2 11 1655 2653 231 39 96.461563 Commission,4 1 6 3 3 0 579 2716 138 32 -1 5 1 6 3 3 1 579 2717 76 31 96.682320 that5 1 6 3 3 2 673 2716 44 31 94.340332 is: Decision 59 F.T.C.

A. An admission by respondents of all jurisdictional facts alleged in the complaint.

B. Provisions that:

(1) The complaint may be used in construing the terms of the order; (2) The order shall have the same force and effect as if entered after a full hearing:

(3) The agreement. shall not. become a part of the official record of the proceeding unless and until it becomes a part of the decision of the Commission:

(4) The entire record on which any cease and desist order may be based shall consist solely of the complaint and the agreement; (5) The order may be altered, modified, or set. aside in. the manner provided by statute for other orders:

C. Waivers of :

(1) The requirement that the decision niust contain a statement of findings of fact and conclusions of law;

(2) Further procedural steps before the hearing examiner and the Commission.

(8) Any right to challenge or contest. the validity of the order entered in accordance with theagreement.

Tn addition the agreement contains the following provision: A statenent that the signing of said agreement is for settlement. purposes only and does not constitute an admission by respondents that they hare violated the law as alleged in the complaint. Having considered said agreement, including the proposed order, and being of the opinion that tt provides an appropriate basis for settlement and disposition of this proceeding: the hearing examiner hereby accepts the agreement. but orders that it shall not become a part. of the official record unless and until it becomes a part. of the decision of the Commission.

The following jurisdictional findings are made and the following order issued :

1, Respondent Arctic Light Blanket Co.. Inc.. is a corperation existing and doing business under and by virtue of the laws of the State of Massachusetts, with its office and principal place of business located at 1 Fay Street, Worcester, Massachusetts. 2. Individual respondent. Philip F. Goldberg is an oflicer of said corporation. He formulates, directs and controls the acts. policies, and practices of the corporate respondent. The address of the individual respondent 1s the same. as the corporate respondent. 5. The Federal Trade Commission has jurisdiction of the subject matter of this proceeding and of the respondents. ARCTIC LIGHT BLANKET CO., INC., ET AL. 983 979 Order ORDER It is ordered, That respondents Arctic Light Blanket Co., Inc., a corporation, and its officers, and Philip F. Goldberg, individually and as an officer of said corporation, and respondents’ representatives, agents and employees, directly or through any corporate or other device, in connection with the introduction, or manufacture for introduction into commerce, or the offering for sale, sale, transportation or distribution in commerce, as “commerce” is defined in the Federal Trade Commission Act and the Wool Products Labeling Act, of wool blankets or other wool products, as such products are defined in and subject to the said Wool Products Labeling Act, do forthwith cease and desist from misbranding such products by: 1. Falsely or deceptively stamping, tagging, labeling or identifying such products as to the character or amount of the constituent fibers contained therein.

2, Failing to affix labels to such products showing each element of information required to be disclosed by Section 4(a) (2) of the Wool Products Labeling Act of 1939. :

It is further ordered, That respondents, Arctic Light Blanket Co., Inc., a corporation, and its officers, and Philip F. Goldberg, individually and as an oflicer of said corporation, and respondents’ representatives, agents and employees, directly or through any corporate or other device, in connection with the offering for sale, sale or distribution of wool biankets or other merchandise in commerce, as “commerce” is defined in the Federal Trade Commission Act, do forthwith cease and desist from directly or indirectly misrepresenting on sales invoices, shipping memoranda, or In any other manner the fiber content of said products.

DECISION OF THE COMMISSION AND ORDER TO FILE REPORT OF COMPLIANCE Pursuant to Section 8.21 of the Commission's Rules of Practice, the initial decision of the hearing examiner shall, on the 24th day of October 1961, become the decision cf the Commission; and accordingly:

[tis ordered, That respondents herein 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. Complaint 59 F.T.C.