Korma Textile Mills, Inc., et al.

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

IN THE IATTER OF KOR)IA TEXTILE MILLS, IXC., ET AL.

CONSE:-T ORDER , ETC.. IX HEG.\Rn TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE C01unSSTON ACT Docket C-115. COtiplaint, Apr, 19U.!--Dccision "lpr. , 196' Consent order requiriIlg Xl'w York City jobbers of textie fabric to cease repref'enting falsely, through llse of the word " ?lIiJls" in their corporate and trade names, that they manufactured their fabrics in their own fartories. COJrPL\ TXT Pursuant: to the prm- isions of the Federal Tratle COlnmis::ion Act ane! by virtnf' of the authority vested in it by said Act, the Federal Trade Commissioll, having lea on to believe that Korma Textile. \Iills Inc., a. corporation, and .Julius JHauler, inc1ividnal1y and as an offcer of saiu. corporation, hereinafter referred to as respondents have. "10- Jateu. the provision:) of said -,Act, find it appearing to the Commission that a proceeding hy it. in respect thereof ,youlcl be in the public interest, hereby issues its complaint stating its chnxge.s ill that respect as follows :

PARAGRAPH 1. Hesponclent Karma. Textile J'liIls: Inc., is a corporation, organized, existing and doing business under the In ',"s of the State of New York, with its principaJoffce and place of business located at 457 Broadway, KC\, York 13 Respondent .Julius l\laurel' is an officer of the. corporate respondent. He formulates the policies and directs nnd controls the nets and prac- 734 FEDERAL TRADE COMMISSION DECISIO Complaint GO F.

tices of t11e corporate respondent, including the acts and practices hereinafter set forth. His address is the same as that of the corporate respondent.

PAR. 2. Respondents are jobbers of textile fabrics and are now, and for some time last past, have been engaged in the advertising, offering for sale, sale and distribution of said fabrics. PAR. 3. In the course and conduct of their business, respondents now cause, and for somet.ime last past have caused, their said products, when sold, to be shipped from their place of business in the State of York to purchasers thereof in various other states of the United States and mainta, , and at all times mentioned.d herein have maintained, a substantial course of trade in said products in commerce, as "commerce is defined in the Federal Trade Commission Act. PAR. 4. In the course and conduct of their business in soliciting the sale of and in selling textile fabrics, responde,nts do business under the name of Korma Textile Mills, Inc., and Karma Textile Mills, and use sa.id names on letterheads, labels anll in various advertisements of their products.

\R. o. Through the use of the word "jUills" as part of the respondents' corporate and trade names, respondents represent that they own or operate mills or factories in which the textile fabrics sold by them are manufactured.

\H. 6. Said representation is fa.lse, misleading and deceptive. In truth and in fact, respondents do not myn or operate the mills or factories in which the textile fabrics sold by them are manufactured but the,y buy said fabrics from others.

PAR. 7. There is a preference on the part of many manufacturers, retailers and clear.lers to buy products, including textile fabrics, direct from factories or mills, believing that by so doing lo\\-cr prices and other advantages thereby accrue to them.

\R. S. In the conduct of their business, at. all times mentioned here- , respondents have been in substantial competition, in commerce with corporations, firms, a,nel inc1ividua.ls in the sale of textile fabrics of the same general kind and nature as those sold by respondent PAR. D. The use by respondents of t.he aforesaid false, misleading and deceptive statements, representations and practices has had, and now has, the capacity and tendency to mislead retailers and other purchasers into the erroncous and mistaken belief that said statements and representations were, and are, true and into the purchase of substantial quantities of respondents' products by reason of said erroneous and mistaken belief.

KORMA TEXTILE MILLS ) I:\C. ) ET AL. 735 733 Decision and Order PAR. 10. The aforesaid acts and practices of respondents, as herein a.Jleged, were, and are, all to the prejudice and injury of the puhlic aud of respondents' competitors and constituted, and now constitute, lmfair methods of competition in commerce and unfair and deceptive acts and practices in commerce in violation of Section 5 (a) (1) of the Federal Trade Commission Act.

DECISION c\ND ORDER The Commission having heretofore determined to issue its complaint clulrging the respondents named in the caption hereof with violation of the Federal Trade Commission Act, and the respondents ha.ving been served with notice of saiel determination and with a copy , toge.their' ,,,ith H,of the complaint the Commission inten(led to issue proposed form of order; and The respondents and counsel for the Commission having thcreafte-r executed an a.agreement containing 11 consent order, an admission by respondents of all the jurisdictional facts set forth in the complaint to issue herein, fL statement that the signing of said agreement is for settlement purposes only and does not constitute an admission by respondents that the law has been violated as set forth in such complaint, and waivers and provisions as required by the Commission rules; and The Commission, having considered the agreement, hereby accepts same, issues its complaint in the form contemplated by said agreement ma.kes the following jurisc1ietional findings, and enters the following order:

1. Respondent Karma Textile :Mills, Inc., is a. corporation organized existing and doing business under-r and by virtue. of the laws of the place of businessSate of New York, with its 'Offce and principal located at 457 Broadway, in the city of New York, State of Kew York. Respondent J nlius :M:fLuler is all offcer of said corporation, and his address is the same as that of said corporation. 2. The Federal Trade Comn1-ission has jurisdiction of the subject matter of this proceeding and of the respondents, and the proceeding is in the public interest.

ORDER , a corporfLtion, and 1 t is ordered That ICorma Textile :.\ills, Inc. its offcers, and Julius l\1auJer, individually and as an offeer 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 te.xtile fabrics in commerce Complaint 60 F.

as "commerce" is de.fined in the Federal Trade Commission Act, do fort.hwith cease and desist from, directly or indirectly, using the word Mills, or any other w.ord of similar in1po1't or meaning, in or as a part of respondents' corporate or trade name, or respresenting in any other manner that respondents are manufacturers of the fabrics sold by them unless and until respondents own and oper.ate, or directly and absolutely control, the manufacturing plant wherein said fabrics are woven or made.

It is further ordered That the 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 JULve complied with this order. IN THEMA'TR OF ORTON P. HESSER DOING BUSINESS AS O. P. HESSER BROKER CONSE:ST OHDJm ETC., IN REG.-\RD TO 'rue ALI EGED VIOLATION OF SF... 2 (c) OF THE CLAYTON ACT Docket C-lig. Can/plaint, AI)1' 1962-Dccisio1t, Ap'- , 1962 Consent order requiring a broker in Salt Lake City, L'tah, to ceaf;e yiolating Sec. 2(c) of the Clayton Ad b;-' receivi, ng and accepting brokerage on numerous and substantial purchases of food products for his own account for resale, slich as a discount, usually at the rate of IDe per 1% bushel box on purchases of citrus fruit from a number of Texas packers. nIPLAIXT The Federa.1 Trade Commission, having reason to believe that the party respondent named in the caption hereof, and hereinafter more particularly described, has been and is now violating the provisions of subsection (c) of Section 2 of the Chlyton Act, as amended (V. Title 15, See. 13), hereby issues its complaint., stating its charges with respect thereto as follows:

PARAGRAPH 1. Respondent Orton P. Hesser is an individual doing business as O. P. Hesser Broker under and by virtue of the laws of the State of Utah, with his offce a11l principal place of business 10eated at 428 Southwest Temple Street, Salt Lake City, GUth. PAR. 2. Respondent is now, and lor the past several years has been engaged primarily in the brokerage business, representing a number of packer-principals located in various sections of the United States in connc tion with the sale and distribution of citrus fruit and produce, hereinafter sOlnetimes referred to as food products. In par- O. P. HESSER BROKER 737 736 Decision and Order ticular, respondent represents a number of citrus fruit packers located in the State of Texas in the sale and distribution of citrus fruit, for which respol1l1ent \vas and is paid for his services in connection therewith a brokerage or commission, usually at the rate of ten cents per 1% bushel box, or equivalent. A substantial part of respondent' business is acting in the capacity of a buying broker, purchasing citrus fruit and produce for his own account for resale. PAR. 3. In the course and conduct of his business for the past several years, in representing packer-principals, as well as when purchasing for his own account, respondent has, directly or indirectly, caused such citrus fruit or food products, when sold or purchased, to be shipped and transported from various packers' packing plants or places of business located in the. State of Texas to respondent' s customers located in many states other than the State of Texas. Thus for the past several years, respondent has been, and is now! engaged in a continuous course of trade in commerce, as "commerce" is defined in the aforesaid Clayton Act, as amended.

PAR. 4. In the course and conduct of his business in commerce, as aforesaid, during the past several years, but more particularly since January 1, 1960, to the present time, respondent has made, and is now making, numerous and substantial purchases of food products for his own account for resale from various packers or sellers on which purchases he has received and accepted, and is now receiving and accepting, directly or indirectly, something of value as a commission brokerage, or other compensation, or an allowance or discount in lieu thereof, in connection therewith. For example, respondent has made and is now making, substantial purchases of citrus fruit for his own account from a number of packers located in the State of Texas, which fruit is shipped and transported to customers located outside the State of Texas, and on said purchases respondent receives from the packer a brokerage or commission, or a discount in lieu thereof, usually at the rate of ten cents per 1% bushel box, or equivalent. In other instances respondent receives a lower price from the packer which reflects said brokerage or commission. PAR. ;5. The acts and practices of respondent in receiving and accepting a brokerage 'or commission, 01' an allowance or discount in lieu thereof, on his own purchases, as herein alleged and de.scribed, are in violation of subsection (c) of Section 2 of the Clayton Act, as amended (D. C. Title 15, Sec. 13).

DEcrSIOK AXD ORDER The Commission having heretofore determined to issue its complaint charging the respondent named in the caption hereof with violation 738 FEDERAL TRADE Co:nnSSIOX DECISIONS Decision and Order 60 F.

of subsection (C) of Section 2 of the Clayton: , as amended, and the respondent having been served with notice of said determination and \\-ith a copy of the complaint the Commission intended to issue together with a proposed form of order; ancl The respondent and counsel for the Commission having thereafter executed an agreement c.containing a consent. order, an admission by the respondent of all the jurisdictional facts set forth in the complaint to issue hereill a statement that the signing of said a,grecment is for settlement purposes only and clocs not constitute an acl1nissionhy respondent that the la,,, has been violated as set forth in such complaint., and waivers and provisions as required by the Comnlission rules; and The Commission, having considered the agreement, hereby accepts same, issues its complaint in the form contemplated by sa.id agreement makes the following jurisdictional iin(lings, and enters the following order:

1. Respondent Orton P. Hesser is an individual doing business as O. P. Hesser Broker under and by virtue of the la"s of the State of Utah, ,,-ith his offce and p1'inicpal place of Imsiness located at 428 Sout1n\ est Temple Street, Salt Lake City, Ftah. 2. The Federal Trade Commission has jurisdiction of the subject matter of this proceeding and of the respondent. ORDER It is oJ'lei'ccl That respondent Orton P. 1-1esse1', indiyidualIy and doing business as O. P. IIessel' Broker, and respondent:s agents, representali n:'3, antl employees, directly or through any corporate, partnership, sole proprietorship, or other device, in connection with the purchase of cit.rus fruit or produce in commerce., as "commerce" is defined in the Clayton Act. as amended, dnforthwith cease a.nd desist. from: Receiving or acceptil1g, directly or indirectly, from any seller, anything of value as a commission, brokerage, or other compensation 01' any allowance or (1discount in lieu thereof, upon or in connection wit.h any purchase of cit.rus fruit. or produce for respondents own account, or where respondent is the agent, representative, or other intermediary acting for or in behalf, or is subject to the direct or indirect control, of any buyer.

It i8 fll!'the!' ol'dated That the respondent herein shall, "within sixty (GO) days after service upon him of this order, file with the Commission a report in ,,uiting setting forth in detail the manner and form in which he has complied \,ith this order.

(; , BGS SHOE CORP. ET AL. i39 Complaint