Peter Pan Yarn Corp.

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IN THE MATTER OF PETER PAN YARN CORP. ET AL.

CONSENT ORDER, ETC. , IN REGARD TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSION AND THE WOOL PRODUCTS LABELING ACTS Docket 923. Complaint, July 1965-Decision, July, 1965 Consent order requiring New York City importers, wholesalers and retailers of wool products, to cease misbranding and falsely advertising wool yarn or other wool products in violation of the Wool Products Labeling Act by such practices as falsely labeling and advertising certain yarns as "100% Mohair " when said yarns contained other woolen fibers, and using the term "mohair" in lieu of "wool" to describe fibers which are not entitled to such designation, and to cease violating the Federal Trade Commission Act by falsely representing the fiber content of said products on invoices. Complaint 68 F.

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 Peter Pan Yarn Corp. and King Arthur Yarn Corp., corporations, and Morris Batansky, individually and as an officer of said corporations, hereinafter referred to as respondents, have violated the provisions of the said Acts and the Rules and Regulations promulgated under the Wool Products Labeling Act of 1939, 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. Respondents Peter Pan Yarn Corp. and King Arthur Yarn Corp. are corporations organized, existing and doing business under and by virtue of the laws of the State of New York. Their offices and principal place of business are located at 623 Broadway, New York, New York.

Individual respondent Morris Batansky is an officer of both of said corporations. Respondent formulates, directs and controls the acts, policies and practices of both of said corporations. His address is the same as that of said corporations. Respondents are importers, wholesalers and retailers of wool products.

PAR. 2. Subsequent to the effective date of the Wool Products Labeling Act of 1939, respondents have introduced into commerce sold, transported, distributed, delivered for shipment and offered for sale in commerce, as "commerce" is defined in said Act, wool products as "wool product" is defined therein. PAR. 3. Certain of said wool products were misbranded 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, labeled or otherwise identified with respect to the character and amount of the constituent fibers contained therein. Among such misbranded wool products, but not limited thereto were certain yarns stamped, tagged or labeled as containing 100% Mohair, whereas in truth and in fact, said yarns contained substantially less Mohair than represented and in addition contained a substantial amount of other woolen fibers. PAR. 4. Certain of said wool products were further misbranded in that they were not stamped, tagged, labeled or otherwise identi- PETER PAN YARN CORP. ET AL. 283 281 Complaint fied as required under the provisions of Section 4 (a) (2) of the Wool Products Labeling Act of 1939 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 certain yarns with labels on or affixed thereto which failed to disclose the percentage of the total fiber weight of the wool product, exclusive of Ornamentation not exceeding 5 per centum of said total fiber weight, of (1) woolen fibers; (2) each fiber other than wool if said percentage by weight of such fiber is 5 per centum or more; and (3) the aggregate of aU other fibers. PAR. 5. Certain of said wool products were misbranded in violation of the Wool Products Labeling Act of 1939 in that they were not labeled in accordance with the Rules and Regulations promulgated thereunder in that the term "mohair" was used in lieu of the word wool" in setting forth the required fiber content information on labels affixed to wool products when certain of the fibers so described were not entitled to such designation, in violation of Rule 19 of the aforesaid Rules and Regulations. PAR. 6. The acts and practices of the respondents as set forth above 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.

PAR. 7. Respondents are now, and for sometime last past have been, engaged in the advertising, offering for sale and sale of textie products to the general public. In the course and conduct of their business respondents now cause and have caused their said textie products to be offered for sale by means of advertisements in catalogues and brochures distributed in interstate commerce, which catalogues and brochures are intended to induce and have induced the sale of said textile products. In the course and conduct of their business the respondents have caused their said products, when sold, to be shipped from their place of business in the State of New York to purchasers located in various other States of the United States and maintained, and at aU times mentioned herein have maintained, a substantial course of trade in said products in commerce, as "commerce" is defined in the Federal Trade Commission Act.

PAR. 8. Among and typical of the statements and representations Decision and Order 68 F.

contained in the aforesaid catalogues and brochures, but not all inclusive thereof is the following:

100% Mohair PAR. 9. By and through the use of the aforesaid statements and representations of respondents, respondents represented directly or by implication, that the aforesaid yarn was composed of 100% Mohair, whereas in truth and in fact the yarn contained fibers other than Mohair fibers.

Therefore, the statements and representations as set forth in Paragraph Eight, were and are false, misleading and deceptive. PAR. 10. The use by respondents of tbe 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 respondents' products by reason of said erroneous mistaken belie!. PAR. 11. Respondents in the course and conduct of their business as aforesaid, have made statements on invoices and shipping memoranda to their customers misrepresenting the fiber content of certain of their said products.

Among such misrepresentations, but not limited thereto, were statements representing the fiber content thereof as HMohair whereas in truth and fact the product contained substantially different fibers than represented.

PAR. 12. The aforesaid acts and practices of respondents as herein alleged, were and 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 in commerce within the intent and meaning of the Federal Trade Commission Act. DECISION AND ORDER The Commission having heretofore determined to issue its complaint charging the respondents named in the caption hereof with viola tion of the Federal Trade Commission Act and the Wool Products Labeling Act of 1939 , and the respondents having been served with notice of said determination and with a copy of the complaint the Commission intended to issue, together with a proposed form of order; and The respondents and counsel for the Commission having thereafter executed an agreemep,t containing a consent order, an admission by respondents of all the jurisdictional facts set forth in the complaint to issue herein, a statement that the signing of said PETER PAN YARN CORP. ET AL. 285 281 Order 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 s rules; and The Commission, having considered the agreement hereby accepts same, issues its complaint in the form contemplated by said agreement, makes the following jurisdictional findings, and enters the following order:

1. Respondents Peter Pan Yarn Corp. and King Arthur Yarn Corp. are corporations organized, existing and doing business under and by virtue of the laws of the State of New York, with their offices and principal place of business located at 623 Broadway, New York, New York.

Respondent Morris Batansky is an offcer of both of said corporations, and his address is the same as that of said corporations. 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 is ordered That respondents Peter Pan Yarn Corp. and King Arthur Yarn Corp. , corporations, and their officers, and Morris Batansky, individually and as an officer of said corporations, and respondents' representatives, agents and employees, directly or through any corporate or other device, do forthwith cease and desist from introducing into commerce, or offering for sale, selling, transporting, distributing or delivering for shipment in commerce wool yarn or other wool products, as "commerce " and "wool product" are defined in the Wool Products Labeling Act of 1939: 1. Which are falsely or deceptively stamped, tagged, labeled or otherwise identified as to the character or amount of the constituent fibers contained therein.

2. Unless such products have securely affixed thereto or placed thereon a stamp, tag, label or other means of identiication correctly showing in a clear and conspicuous manner each element of information required to be disclosed by Section 4 (a) (2) of the Wool Products Labeling Act of 1939. 3. Which have affixed thereto labels which use the term mohair" in lieu of the word "wool" in setting forth the quired information on labels affixed to wool products unless the fibers described as mohair are entitled to such designation and are present in at least the amount stated. Complaint 68 F.

It is further ordered That respondents Peter Pan Yam Corp. and King Arthur Yam Corp. , corporations, and their officers, and Morris Batansky, individually and as an officer of said corporations and respondents' representatives, agents and employees, directly or through any corporate or other device, in connection with the advertising, offering for sale, sale or distribution of yarn or any other textile products in commerce, as "commerce" is defined in the Federal Trade Commission Act, do forthwith cease and desist from misrepresenting the character or amount of constituent fibers contained in yarn or any other textile products in advertisements or on invoices or shipping memoranda applicable thereto or in any other manner.

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 man. ner and form in which they have complied with this order.