Burstein-Applebee Company

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IN THE MATTER OF BURSTEIN-APPLEBEE COMPANY ET AL.

CO;-SE"T ORDER, ETC., IN REGARD TO THE ALLEGED VIOLATIO OF THE FEDERAL TRADE COMMISSION ACT Docket C-I031. Complaint, Jan. 1966-Decision, Jan. 12, 1966 Consent order requiring a Kansas City, Mo., retailer of radios, phonographs electronic equipment and other merchandise with stores in Missouri and Colorado, and also sellng by mail-order catalog, to cease making deceptive pricing, savings, and guarantee claims in its advertising. COMPLAINT 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 Burstein-Applebee Company, a corporation, and .J. E. Burstein and Lee Marcus, individually and as offcers of said corporation, hereinafter referred to as respondents, have violated the provisions of the 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:

PARAGRAPH 1. Respondent Burstein-Applebee Company is a corporation organized, existing and doing business under and by virtue of the laws of the State of Missouri, with its offce and principal place of business located at 1012 McGee Street in the city of Kansas City, State of Missouri.

Respondents J. E. Burstein and Lee Marcus are offcers of the corporate respondent. They formulate, direct and control the acts and practices of the corporate respondent including the acts and practices hereinafter set forth. Their address is the same as that of the corporate respondent.

PAR. 2. Respondents are now, and for some time last past have been, engaged in the advertising, offering for sale, sale and distribution of radios, phonograph equipment, radio electronic equipment and general merchandise to the public. Respondents also own and operate retail stores in the States of Missouri and Colorado.

BURSTEIK-APPLEBEE eo. ET AL.

Complaint PAR. 3. In the course and conduct of their business, respondents now cause, and for some time last past have caused, their said products, when sold, to be shipped from their place of business in the States of Missouri and Colorado to purchasers thereof located in various other States of the "United States and the District of Columbia, and maintain, and at all times mentioned herein have maintained, a substantial course of trade in said products and merchandise in commerce, as "commerce" is defined in the Federal Trade Commission Act.

PAR. 4. Respondents, in the course and conduct of their business, and for the purpose of inducing the purchase of their products advertised the same by means of an annual catalog with periodic supplements and in neVispapers of general interstate circulation. The newspaper advertising is primarily in conjunction with respondents' retail stores.

Said catalog and their supplements are distributed through the United States mail to customers located throughout the United States. Said catalog advertising is primarily in conj function with the maiJ order phase of respondents' business. PAR. 5. In their catalog advertising respondents have made certain statements and representations with respect to prices, savings and the guarantees of their products. Typical, but not all inclusive of such statements and representations, are the following: SPECIAL Purchase SALE ON WORLD FAMOUS FISHER eOMPONE:\TS Save $60.

100 40-Watt Stereo Amplifier Originally was $159.

$99.

XIOIB 56 Watt Stereo Amp1ifier Save $60.

$129.

Originally Was $189.

500R 65-Watt FM Stereo Receiver Save $110.

$249.

Originally Was $359.

BOGEI\ SOUKD SPAX STEREO COMPONE:\TS Bogen Model AP60 " Sound Span 66-Watt Stereo Amplifier Save $110.

Reg. Net Was $249.

$139.

Complaint 69 F.

FABULOUS E-A COMBINATION OFFER Save $160.

AP60 Sound Span 66-Watt Stereo Amplifier TP250 FM Stereo Tuner Both for $249. 96 only EMPIRE ZOOM BINOCULARS Mfg. List $65.

$37.

Gc.ARANTEED FOR LIFE NEW B-A ANTBIAGNETIe 17 JEWELED WRISTWATCH PAR. 6. By and through the use of statements set forth in Paragraph Five hereof, and others of similar import not specifically set out herein, respondents represent, and have represented, directly or by implication, that:

a. The higher stated prices set out in said advertisements in connection with the terms "Regular Regularly/' " Originany, Was " and "Save" were the actual bona fide prices at which the articles referred to were offered to the public at retail by respondents on a regular basis for a reasonably substantial period of time in the recent regular course of business and that the difference between the higher prices and the lower prices set out in connection therewith represented savings to purchasers. b. The said higher price amounts accompanied by the phrase Mfg. List" were not appreciably in excess of the highest price at which said product has been regularly offered for sale in the recent regular course of business by a substantial number of the principal retail outlets in thc trade area where such representations appeared.

c. The new " A Antimagnetic 17 Jeweled Wristwatch" is guaranteed for the life of the purchaser in evcry respect. PAR. 7. In truth and in fact:

a. The higher stated prices set out in connection with the terms Regularly, Regular Originally, Was" and "Save " were in excess of thc actual bona fide prices at which the articles referred to were offered to the public at retail by respondents on a regular basis for a rcasonably substantial period of time in the recent regular Course of business, and the diffcrence between the said higher prices set out in connection therewith and at which articles of merchandise are offered for sale did not represent savings to purchasers.

b. The higher prices set out in connection with the words "Mfg. List" were in excess of the highest price at which substantial BURSTEIN-APPLEBEE CO. ET AL.

Dccision and Order sales of the products were made by the principal retail outlets in representative communities throughout respondents' trade area at the time such representations were made. c. Respondents do not guarantee the article of merchandise described in the advertisements for the life of the purchaser. The terms, conditions and extent to which the guarantees apply, and the manner in which the guarantor wi1 perform thereunder are not disclosed in the advertisements.

Therefore, the statements and representations as set forth in Paragraphs Five and Six hereof were and are false, misleading and deceptive.

PAR. 8. In the course and conduct of their business, and at all times mentioned herein, respondents have been in substantial competition in commerce, with corporations, firms and individuals in the sale of the same general kind and nature of products sold by respondents.

PAR. 9. The use by respondents of the aforesaid false, misleading and deceptive statements, representations and practices and hereinabove alleged 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 are true and into the purchase of substantial quantities of respondents' products and merchandise by reason of said erroneous and mistaken belief.

PAR. 10. 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 constHute, unfair methods of competition in commerce and unfair and deceptive acts and practices in commerce, in violation of Section 5 of the Federal Trade Commission Act. DECISIO'i AND ORDER The Commission having heretofore determined to issue its complaint charging the respondents named in the caption hereof with violation of the Federal Trade Commission Act, 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 agreement c01ltaining 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 FEDERAL TRADE COMMISSIOr- DECISIONS Order 69 F.

agreement is for settlement purposes only and does not constitute an admission by respondents that the Jaw 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:

I. Respondent Burstein-Applebee Company is a corporation organized, existing and doing business under and by virtue of the laws of the State of Missouri, with its offce and principal place of business located at 1012 McGee Street, in the city of Kansas City, State of Missouri.

Respondents J. E. Burstein and Lee Marcus are offcers of the said corporation and their address is the same as that of the said corporation.

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 respondent Burstein-Applebee Company, a corporation, and its offcers, and J. E. Burstein and Lee Marcus individually and as offcers of said corporation, and respondents agents, representatives and employees, directly or through any corporate or other device, in connection with the offering for sale, sale or distribution of radios, phonograph equipment, radio electronic equipment Dr any other articles of merchandise in commerce, as "commerce" is defmed in the Federal Trade Commission Act, do forthwith cease and desist from: 1. (a) Using the words "Regularly, Regular Originally" and "'Vas " or any other words or terms of similar import, to refer to any selling price of the respondents which is in excess of the actual bona fide price at which the article referred to was offered to the public by respondents in the recent, regular course of their business for a reasonably substantial period of time in the trade area where the representation is made; or otherwise misrepresenting respondents former offering price of such merchandise to the public in the recent, regular course of their business in the trade area where the representation is made: Pyovided, however That nothing herein shall prevent respondents from stating that BURSTEIN-APPLEBEE CO. ET AL.

Order they have sold such merchandise in the regular course of their business at a designated higher price in the remote past if the time thereof is truthfully and conspicuously set forth together with a1l intervening reductions in price. (b) Using the words "Mfg. List " or words of similar import, to refer to the price at which any product is generally sold by others, when such amount appreciably exceeds the highest price at which substantial sales of the product are being made by principal retail outlets in representative communities throughout respondents' trade area at the time such representation is made.

(c) Representing in any manner that by purchasing any of said merchandise, customers are afforded savings amounting to the difference between respondents' stated price and any other price used for comparison with that price, unless respondents have offered such merchandise for sale at the compared price in good faith for a reasonably substantial period of time in the recent regular course of their business, or unless substantial sales of said merchandise are being made or were made in the recent regular course of business by others in the trade area at the compared price, or a higher price or unless a substantial number of the principal retail outlets in the trade area regularly offer the merchandise for sale at the compared price or some higher price, or when a comparable value representation is used, unless substantial sales of merchandise of like grade and quality are being made in the trade area at the compared price or a higher price and it is clearly and conspicuously disclosed that the comparison is with merchandise of like grade and quality. (d) Misrepresenting in any manner the savings available to purchasers of respondents' merchandise. Provided, however That it shall be a defense in any enforcement proceeding instituted hereunder for violation of Paragraph 1 (a), (b), (c), and (d) of this order arising out of alleged misrepresentations disseminated solely in the catalog, designated by respondents as Burstein-Applebee Company 1966 catalog which was in the process of being printed at the time of entry of this order, if the respondents show that they transmitted flyers or other printed material to their entire subscription list, truthfully and nondeceptively correcting such alleged misrepresentations in prompt response to a1l requests therefor by the Commission.

Syllabus 69 F. T.

2. Using the word "Lifetime" or any other term of the same import to refer to any guarantee which is not for the duration of the life of the purchaser or original user without clearly and conspicuously disclosing the life to which such reference is made; or representing, in any manner, that the duration of a guarantee is other than respondents are able to establish is the fact.

3. Representing, directly or by implication, that any of respondents' products arc guaranteed, unless the nature and extent of the guarantee, the identity of the guarantor, and the manner in which the guarantor wil perform thereunder are clearly and conspicuously disclosed. It i8 jurthe?' ordered That lhe respondents herein shan, within sixty (60) days after service upon them of this order, file with thc Commission a report in writing setting forth in detail the manner and form in which they have complied with this order. 1:\ THE MATTER OF THE B. F. GOODRICH COMP A:'Y AI\D TEXACO , I:'C. (formerly The Texas Company) ORDER, OPINION , ETC. , IN REGARD TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSIO:\ ACT D.ocket 6485. Complai'id, Jan. 11, 1.956-Decision, .Jan. 14, 1966* Order, following a remand direction by ihe Supreme Court, opinion dated June 7 , 1965, 381 -C.S. 739 , '7 S.&D. 1263 , the Commission prohibits, for tJw second time, The B. F. Goodrich Company and Texaco, Inc. (formerly The Texas Company), from carrying out their sales commission agreement-- under ihe agl"eement Goodyich paid Texaco a commission for promoting the sale of Goodrich tires, batteries, and automotive accessories (TEA) to its retail gasoline dealers-and from entering into sales comm;ssion arrangements with any other company. On ,June 7 , 1965, the Supreme Court vacated the judgment of the Court of Appeals, District of Columb:a Circuit, dated July 1964 , 336 F. 2d 754 , 7 S.&D. 91)6 , \.which set aside the Commission s cease and desist order of April 15 , 1963 , 62 F. C. 1172.

"This ord"J" was JT.odified on i\ra ch 12. 1060 , in cor.:or'1Hnc" with a mand"te of the 511preme Coun, by celeti g r.umbered parag!"flj1n5 . and 6 of the ordcr diren"d against Texaco THE B. F. GOODRICH CO. ET AL.

Opinion OPINION OF THE COMMISSION JANUARY , 1966 BY ELMAN Commissioner:

On April 15, 1963 (62 F. C. 1172), the Commission held unlawful as an unfair method of competition in violation of Section 5 of the Federal Trade Commission Act' a sales commission agreement between The B. F. Goodrich Company ("Goodrich" and Texaco, Inc. ("Texaco ). Under that agreement Goodrich pays Texaco a commission for promoting the sale of Goodrich tires, batteries, and automotive accessories ("TEA" ) to its retail gasoline dealers. By its order, the Commission enjoined Goodrich and Texaco from carrying out their agreement and from performing or entering into sales commission arrangements with any other companies. On review the Court of Appeals for the District of Columbia Circuit set aside the Commission s order and directed the Commission to dismiss the complaint. Texaco, Inc. v. 336 F. 2d 754 (D.C. Cir. 1964). On June 7 , 1965 , the Supreme Court granted certiorari, vacated the judgment of the Court of Appeals, and directed that the case be remanded to the Commission "for further proceedings, without the participation of Chairman Dixon, in light of Atlantic Refining Co. v. Federal Trade Comm (381 V. S. 357 (1965)). C. v. Texaco, Inc. 381 U. 739, 740.

I n A tlantic the Supreme Court upheld (1) the Commission decision that a sales commission agreement between Atlantic Refining- Company and Goodyear Tire & Rubber Company was unfair method of competition, and (2) the Commission s order prohibiting Atlantic and Goodyear from carrying out their agreement and from performing or entering into any other sales commission agreements. The Commission, without the participation of Chairman Dixon and Commissioner MacIntyre, has reviewed afresh the entire record in this proceeding, in the light of the Supreme Court' s decision in Atlantlc. We have concluded, for the reasons set forth below\v, that the sales commission agreement involved here is, in its fundamental operation and effect, indistinguishable from the one held unlawful in Atlanhe and that an order like the one affrmed by the Supreme Court in Atlantic should be entered here.

J Section fi provides in relevant part:

Unfair methods of competition ;n commerce, ann unfair or rleceptive acts or practices in commerce, are declared unJa.wful, Opinion 69 F.

An assessment of the relationship between this case and Atlantic requires a brief description of the events leading to this remand. This is one of three companion cases in which the Commission challenged, as an unfair method of competition, sales commission arrangements between major rubber companies and major oil companies. In Goodyear Tire Rubber Co. 58 F. 309, decided March 9, 1961 , the Commission entered an order prohibiting Goodyear and Atlantic from employing sales commission plans. On the same day, in Firestone Tire Rubber Co. 58 F. 371, an identical order was entered against Firestone and Shell Oil Company. The Commission s order in Goodyear has been affirmed by the Supreme Court. Atlantic Refining Co. v. 381 U. S. 357, affrming 331 F. 2d 394 (7th Cir. 1964). An appeal from the Commission s order in Firestone is pending in the Court of Appeals for the Fifth Circuit.

In both Goodyear and Firestone the Commission s reasoning was identical: It upheld the hearing examiner s finding that the oil companies used overt coercive tactics to force their dealers buy the sponsored rubber companies' TEA products. Eut the Commission specifically declined to rest its decisions upon a finding of coercion or to limit its orders to injunctions against coercive tactics. Instead, it examined the unique degree to which the economic existence of gasoline dealers is dependent upon the good wil of their major oil company suppliers, and concluded that the oil company "has suffcient economic power with respect to its . . . distributors to cause them to purchase substantial quantities of sponsored TEA even without the use of overt coercive tactics. . . . " (58 F. C. at 364- , 407. ) The Commission regarded "overt acts of coerdon as mere symptoms of a more fundamental restraint of trade inherent in the sales commission itself" (58 F. C. at 348, 398). Analyzing the actual operation of the sales commission plan in the context of the economic relationship between the oil company and its dealers, the Commission concluded that the competitive effects of the sales commission plan were like those of an ilegal tying arrangement-it "presents a classic example of the use of economic power in one market (here, gasoline distribution) to destroy competition in another market (TEA distribution)" (58 F. C. at 367: see 58 C. at 406). Since the amount of commerce affected was "not insubstantial " the agreements were held unlawful. However, in this proceeding involving the Goodrich-Texaco THE B. F. GOODRICH CO. ET AL.

Opinion sales commission plan, the Commission did not reach the same result. On the same day that it issued its orders in Goodyear and Firestone the Commission held that although "Texaco has suffcient economic power over its wholesale and retail petroleum distributors to cause them to purchase substantial amounts of sponsored TEA even without the use of overt coercive tactics " the record did not contain "suffcient market data to enable the Commission to assess the competitive effects of the sales commission method of distributing TEA." The case was remanded to the hearing examiner for the taking of additional evidence on that issue. B. F. Goodrich Co. 58 F. C. 1176, 1178 , 1183. This disposition was, at the very least, enigmatic: In Goodyear the Commission found that the competitive effect of the sales commission plan, like a tying arrangement, was the foreclosure of the substantial TEA marketing outlets represented by Atlantic dealers. This finding was based upon competing wholesalers' testimony that they were unable to sell to Atlantic dealers who feared that Atlantic would look with disfavor upon their purchase of any but Atlantic-sponsored TEA products. Having made this finding, the Commission made no analysis of "market data other than to observe that the amount of commerce affected was not insubstantial" since Atlantic had sold about $50 milion in sponsored TEA products during the period 1950-1956. (58 F. at 359-66) In Goods1:ch the Commission did not reject the hearing examiner s acceptance of the testimony of competing wholesalers regarding foreclosure of Texaco outlets, which was similar to, and as substantial as, that in Goodyear. The amount of commerce affected in Goods1:ch was considerably more substantial than that in Goodyear: in the five-year period 1952-1956 Texaco sold more than $245 million in sponsored TEA, almost five times as much as was involve l in Goodyear during a six-year period. What additional "market data" was required is unclear. On remand, after taking further evidence, the hearing examiner found that the sales commission plans had been shown to be an unfair method of competition, and entered an order identical to those previously entered in Goodyear and Firestone. An appeal was again taken to the Commission. By that time, the composition of the Commission had changed and only one of the Commission- In F;rcstone the Commission did consider market share data re)ating to the entire(' m!!tket for TBA , inclljding da a relating to other outlets for TBA other than service stations and othet methuds of distributing- TEA other that; saJe cOlYrr.ission pJ!lDS- But none of this information was present in Goodyear and so presumably this was not the kind of " market datil " de meg critic8.1 by the Commission to a finding of illegality. FEDERAL TRADE COMMISSIO DECISIONS Opinion 69 F.

ers (Commissioner Anderson) who had participated in the Commission s earlier decision remained on the Commission. On this second appeal to the Commission, much of the evidence introduced on the remand was challenged as incompetent or immaterial. The Commission concluded that the challenged evidence was unnecessary to its decision, and, with Commissioner Anderson dissenting, upheld the examiner s order. ' In its view, the legal principles under which the sales commission plans were held unlawful in Goodyear and Firestone were equally applicable to the Goodrich record, even without the challenged evidence (E. F. Goodrich Co. Docket 6485, order issued April 15, 1963) (62 C. 1172).

On appeal, the Court of Appeals for the District of Columbia Circuit reversed and ordered that the complaint be dismissed.' After holding that Chairman Dixon was barred from participating in the decision of the case, the Court of AppeaJs went on to reject the Commission s decision on the merits. It rejected the examiner s finding that Texaco employed coercive tactics and then held that "the Commission erred in concluding that Texaco has suffcient economic power over its dealers, without the use of coercive tactics, to cause them to buy substantial quantities of Goodrich TEA. " (336 F. 2d at 762. ) Instead, it found that Texaco dealers "are quite free to accept or reject" the oil company s "recommendation " to puchase sponsored TEA products (id. at 763). The fundamental premise underlying this conclusion was the Court of Appeals' finding that there was " no basis in this record for the Commission s conclusion that Texaco has controlling economic power over its dealers " and that Texaco s "contracts with (its) dealers do not give rise " to an inference that it did. (Id. 762. ) In the court' s view, the "promotional services" performed by Texaco were indistinguishable from, and no less Jawful than conventional salesmanship to wholly independent purchasers. This approach conflicted with that of the Court of Appeals for the Seventh Circuit, which affrmed the Commission s order in Goodyear. For the Seventh Circuit the starting point for any realistic assessment of thc nature and competitive effect of an oil company s "recommendations " under the sales commission plan was the economic power which the oil company possessed over its , We a re(' that the evidence cnal1enged on the Recond appeal to the Commission is unnecc98nry to our decision and have stricken the Fir.dings and Conclusions of the hearing examiner based upon it.

Texaco, lnc. Y. 6 F. 2d 754 (D. C. Cir. 1964). Goodyear Tire Rubber Co. v. 331 F. 2d 394 (7th Cir. 1964). THE B. F. GOODRIeH eo. ET AL.

Opinion dealers and which derived from the contractual relationship between them. In its view, the "heart of this case is the economic power Atlantic possesses over its service station dealers" (331 F. 2d at 400). Such power was not at a11 dependent upon coercive tactics.' Rather, the "keystone" to that power could be found in the "lease and equipment loan contract with their short term and cancellation provisions. (Ibid. Viewed in the context of these provisions, the "servjce station dealer is more of an economic serf than a businessman free to purchase the TEA of his choice. (Ibid. Reaching an opposite conclusion from that of the District of Columbia Circuit in Texaco the Seventh Circuit held (id. 401) :

Atlantic s power to cause jts dealers to carry either Goodyear or Firestone TEA does not depend upon overt coercive meihods. The totality of facts surrounding the relationship between the oil company and the dealers points to one conclusion: the oil company is able to exert suffcient economic power over its dealers so that for all practical purposes they are required to carry sponsored TEA.

Atlantic says that its influence over its dealers to purchase sponsored TBA short of force, threat, or intimidation is la\.vful; that it may recommend high quality TBA to its dealers; and that such action serves a leg:timate business purpose in the promotion of the sale of gasoline. This would be a persuasive argument except for the dealers' economic dependency upon the oil company. In that setting, recommendation is tantamount to command. Covert practices are as effcient as overt action. Sophisticated methods of pressuring the dealers into carrying sponsored TEA are as effectual as express covenants and open threats.

Supreme Court review was sought in both Texaco and Atlantic- Goodyear. The Commission, arguing that different dispositions of the two cases based upon narrow factual distinctions would be inappropriate, framed the issue presented by both cases in identical, broad terms, asking the Court to hold that: (IJt js an unfair method of competition, in violation of Section 5 of the Federal Trade Commission Act, for a major rubber company and a major The Seventh Circuit ulJheld the Commi sion s finding uf coercion; the Dh;trict of Columbia Circuit rejected it. The evidence of cuercion in Te.xaco was no less substantial than that in AtlanUc-Goodyeur. The different results on appeal appear attributable to two factors: (1) the Seventh Circuit defened to the hearing examiner s assessment of the witnesses ' cl.edibility, and (2) while only a few dea),,,r witne%cs testified to coercive tactics and a eon iderably larger number of dealers called by respondents testjfJed to the contnuy, the S"v"nth Circuit thought the hearing examiner col.rectly evaluated the entire tpstimony in li"ht of the economic delJendency of dealers upon the oil company. Review in the Supreme Court of the fmdinl' of coercion was not sougl1', in Atlantic. To the extent j" sp0T1"ents seek to dj tillguish this case from At/antJc on the pr"scr.ce or absence of coerc.ion, we conclude that no such factual distinction exists: we do not djsturb the examiner s finding of coercion which was based eSd!'ntiaJly on his assessment of the credibility of the witnesses. Uni.versa/ Cwmera Corp. v. 340 U. S. 474 , 495-96. However, as we point out below, the fundameni81 issue here-the legal.lity of sa:es commis ion agreements between major oil and major rubber companies d()e not turn on a finding of coercion, and we do not rf'st our dedsion upon it.

Opinion 69 F.

oil company to enter into an agreement under which the oil company, in return for a commission, sponsors the sale of the rubber company s products to the oil company s retail dealers.

In both cases the Commission urged the same broad rationale reflected by the Commission and Seventh Circuit decisions in Goodyear: (1) Because of the gasoline dealer s singular dependence upon, and subservience to, his major oil company supplier, the oij company had the power to require its dealers to purchase substantial quantities of TBA without overt coercion; (2) the promotional services which the oil company was obligated to, and did perform under the sales commission agreement constituted the exercise of that power for the benefit of the sponsored TBA supplier; and (3) as a result, the effect of the sales commission plan is like that of a tying agreement, foreclosing competing non-sponsored suppliers from the substantial market of the sponsoring oij company s dealers.

The Supreme Court reviewed the A tlantic- Goodyear case for the purpose of resolving the " apparent conflict" with Texaco (381 US. at 363). The Court affrmed the Seventh Circuit' s decision and a week later vacated the judgment of the District of Columbia Circuit in Texaco and ordered that the case be remanded to the Commission for reconsideration in light of the decision in Atlantic (F. C. Texaco, Inc. 381 L. S. 739). We turn then to the threshold question in this remand proceeding: What light is cast by the Supreme Court' s decision in Atlantic upon the appropriate disposition of this case Reading its opinion against the background set forth above, we can draw only one conclusion: In upholding the Seventh Circuit and Commission decisions, the Supreme Court approved their broad rationale, rejected the approach taken by the District of Columbia Circuit in this case, and enunciated a rule which transcends the confines of the particular facts involved in Atlantic. the Court's view, whiJe coercive practices aggravate the restraint imposed by the sales commission plan, it is the oij company power over its dealers, derived from the contractual relationship between them, and the utilization of that power through the performance of the promotional services required by the sales com- C. v. Texaco, Inc. , 81'prCL, Petition for D. Vr'rit of Certiorari to the United States Court of Appeals for the District of CoJutr. bill, p. 2; AUantic Refining Co. v. C" supra Brief for the Federal Trade Commission, p. 2. 'Atlantic Refining Co. v. , supra Brief for Federal Trade Commission, pp. 32-34; C. v. Texaco, Inc., supra Peti:ion for a 'Writ of Certiorari, pp. 16- 19. , THE B. F. GOODRICH eo. ET AL.

Opinion mission agreement, which renders the sales commission plan unlawful.

The starting point for the Supreme Court' s analysis, like the Seventh Circuit' , is reflected in its emphasis upon the oil company s considerable economic power over its dealers. The Court said (381 U.S. at 368):

(Atlantic and its dealersJ simply do not bargain as equals. Among the sources of leverage in Atlantic s hands are its lease and equipment loan contracts with their cancellation and short-term provisions. Only last term we described the power implications of such arrangement in mpson Union Oil Co. 377 U. S. 13 (1964), and we need not repeat that discussion here. It must also be remembered that Atlantic controlled the supply of gasoline and oil to its wholesalers and dealers. This was an additional source of economic leverage United States v. Loew s, Inc. 371 e. s. 38, 45 (1962). . . .

In this context threats and coercive practices " merely bolstered" the "lever " which resulted from this economic power (id. at 369), The Court viewed the oil company s aggressive and vigorous salesmanship in carrying out the sales commission plan wholly apart from any coercive tactics, as an exertion of "the persuasion that is a natural incident of its economic power (id. 368), rather than as thc "recommendations" of a salesman to an independent purchaser "free to accept or reject" them. Accordingly, the Court accepted the Commission s and the Seventh Circuit' s characterization that the sales commission contract, which obligated thc oil company to use its power over its dealers to sell the sponsored rubber companies' TEA , had the same "central competitive characteristic" as a tying agreementthe utilization of economic power in one market to curtail competition in another. (ld. at 369. ) Indeed, in the Court's view that was its primary if not sole purpose. Under the sales commission plan (as the records in both A tlantic and Texaco show), the oil company, without making any investment in distributional facilities or TEA inventory, and without relieving the TEA supplier of the burden of sales, distribution, and service, is nevertheless paid large commissions for its promotional efforts. Accordingly, the Court found that "it is diffcult to escape the conclusion that there would have been Jitte point in paying substantial commissions to oil companies were it not for their ability to exert power over their wholesalers and dealers. . . Cid. at 376). In sum, the Supreme Court, in upholding the Commission . , FEDERAL TRADE eOMMISSIOX DECISIOXS Opinion 69 F. T.

order prohibiting outright the use of the sales commission plan by Atlantic and Goodyear, was also affrming the rationale of the Commission s decision, which the Court described as follows (id. at 361) :

CTJhe Commission considered the coercive practices to be symptomatic of a more fundamental restraint of trade and found the sales-commission plan illegnJ ?:n itself as a classic example of the use of economic power in one market. . . to destroy competition in another market. . " (Emphasis supplied.

At the same time the Supreme Court dispelled the ambiguities generated by the Commission s first decision in this proceeding. An assessment of the competitive effects of the sales commission plan does not require an analysis of "market data," Since the testimony only confirmed what was essentially implicit in the relationship between the oil company and its dealers-that the oil company s sponsorship under the sales commission plan has the competitive effect of foreclosing non-sponsored TEA suppliers from access to the market represented by the oij company s dealers-further market analysis is unnecessary. It is suffcient to show that a "not insubstantial portion of commerce is affected. To be sure, the Supreme Court took note of the striking demonstration in Atlant?c of both the extreme abuses attending AtJantic s use of the sales commission plan, and the dramatic effectiveness of the plan in foreclosing non-sponsored TEA suppliers from the Atlantic service station market. Atlnntic was the first case before the Court involving a challenge to the sales commission plan; it presented for review a Commission decision who e rationale would render unlawful the sales commission plans themselves, whenever used by major oil and rubber companies. The Court, therefore, made a careful examination of the entire record to assess the "economic and business stuff out of which these arrangements emerge " so as to determine \vhether they are "naked "The Court said in this regard (id. at 371) : Goodyear and Atlantic contend that the Commissio,i shou)d have made a far mon extensive economic analysis of the competitive died of the, sales-commission J)lan, examining the entire market in tires, batteries and acce,sories. But just as the cr.cet of this p;an is imilar to that of a tie- in. so it is unn"Cf'S H.ry t" embark upon a full-scale e"onomic flnnlysis of competitive effect. Wp think it enough that the Con:mission founr: that a not ir.substantial pm-tion of commerce is affected, AtlaYJtir had indeed based its contention that a more extensive economic analysis was necc ,ary, in part, upon the Commission s first decision to remand Goodrich- Texaco to take evidence cf "market data"' fo)' an assessment of the competitive eft.,rt of tl,c ale commission plan!. Atlanf1c Relining Co. v. C. supra Brief of Petitioner The Atlantic Refining Comp ny, pp. 31- , 57, n. 43. THE B. F. GOODRICH CO. ET AL.

Opinion restraints of trade with no purpose except stifling of competition and whether "they may be too dangerous to sanction (White Motor Co. v. United States 372 U. S. 253 , 263). But, like the Commission, the Court looked upon the dramatic aspects of Atlantic as "symptomatic" of a broader problem. Having examined, as reflected by the record in Atlantic the dangers presented by sales commission plans, their essentially anti competitive character, and the vivid demonstration of the abuses which may attend their use the Court concluded more generally that the sales commission plan itself "amount(sJ to a device that permits suppliers of tires batteries and accessories, through the use of oil company power, to effectively sew up large markets" and, as such, could not be defended even though it might be an effcient and economic method of distribution (381 L. S. at 371). Consequently, the Court's ultimate concern was not limited to the sales commission plan involved in Atlemtic but was rather with "the destructive effect on commerce that would result from the widespread use of these (sales commissions contracts by major oil companies and (TBAJ suppliers (ibid.

The Court' s concern in Atlantic with the dangers presented by the "widespread use" of the sales commission plans by major oil and TBA suppliers is especially significant. Atlantic was not, as the Court was well aware, an isolated case. In Texaco in which a petition for certiorari was pending at the time of the Court' s decision in Atlantic the record showed that Texaco entered into sales commission plans with three of the leading rubber companies- Goodrich, Firestone and, under an agreement instituted about the time this proceeding began, U.S. Rubber Company, Goodrich also had sales commission plans with Continental Oil Company and other oil companies as well. The Firestone and Goodyear-A tlantic cases show that both Goodyear and Firestone have sales commission plans with Shell and Atlantic; that in addition, Goodyear has sales commission plans with Sinclair Refining Company, Richfield Oil Company, and a number of other oil companies; and that Firestone, in addition to its sales commission plan with Texaco, has sales commission arrangements with "()union Oil Company, Continental Oil Company, and others. The service station dealer outlets affected by these sales commission plans constitute a vast market for the sale of TBA; and at the same time only the largest rubber companies are the beneficiaries of the marketing advantages derived from the sales commission plans, a fact which would appear to confirm the Commis- Opinion 69 F.

sion s finding in Atlantic that smaller TEA suppliers are unable to utilize the sales commission arrangement (58 F. C. at 367). Given the Court' s view of the fundamentally anti competitive character of the sales commission plan when used by oil companies possessing power over their dealers, the proliferation of these plans between major oil companies and major rubber eompanies constitutes in itself an acute danger for competition. It was in this context that the Court, looking beyond A tlantic and the specific facts involved there, concluded that generally the use of the sales commission plan by major oil companies and major rubber companies, whatever its economic advantages, is a practice too dangerous to sanction.

This conclusion is buttressed as much by what the Court did, as by what it said. The Court' s affrmance of the Commission s order prohibiting outright the use of sales commission plans by Atlantic and Goodyear not only between themselves but with other companies had broad competitive consequences in both the TEA and petroleum markets. If the Court's decision were to be read as Jimiting the Commission in its evaluation of other sales commission plans to the specific factual circumstances involved in A tlantic one major oil and onc major rubber company would be prohibited not only from further engaging in coercive tactics, but from using a sales commission plan which its major competitors might still be free to use.

For example, at the present time, it would appear that three of the largest rubber companies, Goodrich, Firestone, and U. S. Rubber, use sales commission plans providing Texaco sponsorship to promote their TEA products to Texaco s dealers. Yet, Goodyear could not ask Texaco (even assuming that Texaco has demonstrated no propensHy to use coercive tactics in performing its other sales commission plans) to perform for it the same promotional service which Texaco performs for Goodyear s three major competitors. At the same time, Texaco, one of the largest oil companies, without making any investment in distributional facilities or TBA inventory, receives substantial commissions for the sale of TEA products to its service stations. Atlantic, a major oil company but substantially smaller than Texaco, is barred from the same economic opportunity, no matter how scrupulously it might refrain from coercive tactics in the future. Yet, the same kinds of Jeases, equipment loan contracts, and sales agreements stressed by the Court in Atlantic also render Texaco dealers economically subservient to, and dependent upon, Texaco; and its sales commis- THE B. F. GOODRICH CO. ET AL.

Opinion sion plans require Texaco to perform the same kind of vigorous promotional campaign described in Atlantic. To bar only Atlantic and Goodyear from the use of the sales commission plan would thus not only create a harmful competitive imbalance among the leading flrms of the two industries, it would be arbitrary and inequitable.

The Supreme Court was informed of the harmful and anomalous consequence of a rule confined to the particular facts of AtlanticY We find nothing which would permit us to read the Court' s opinion, or its remand order in this proceeding, as sanctioning such results.

In our view the Supreme Court' s decision in A tlantic compels the conclusion that the Texaco-Goodrich plan is an unfair method of competition and that Texaco and Goodrich should be prohibited, as were Atlantic and Goodyear, from performing or entering into any other sales commission plans. The Court's concern for the dangers which derived from a widespread use of the sales commission plan is especially relevant here. As has been pointed out, Texaco is considerably larger than Atlantic. Its service station dealers constitute an even more significant TEA market. Stations operated by Texaco s lessee dealers" and contract dealers constituted 16. 570 of the service stations in the United States in the year 1955. In that year, Texaco had approximately six times as many contract and lessee dealers as Atlantic." Moreover, as we have noted, in Atlantic the total sales to At- 10 The Government in its petition for certiorari in Texaco told the Court: Even if the cases fAtlantic Rnd TexacoJ could be di;;tinguished on their racj, the confect, if unresolved, would create an anomalous situation in which on., major oil company and a large tire company were permitted to employ e ,;entialJy the same marketing practice that their ompetjtorB were prohibited from using. C. v. Texaco, Inc" 381 1:. 8. 739 , Petition for a Vhit of Cen:orari, I'. 12. Similnrly, Atlantic told the Supreme COUtt that: The order in each of the two cases represents a rule of J;general application, not the disposition of an isolated controversy. The rule should lw unifurm througho:lt the industry. Moreover, Atlantic and Texaco are comj.wtito1"s: and Atlantic, :he smaller romp any, s),ould not be under a marketin" handicap as against. Texaco, which is three times large1". Atlantic Refi.ning Company, 8uprrL Brief of Petitioner The Atlantic Refining Company, p. 34.

11 A lessee station (referred to as a C station) is one that is either owned or leased by Texaco and in turn leased by it to the dealer. 12 A contract station (referred to as D stations) is either owned by the opeJ'at01' or Jeased by him from someone other than Texaco. In addition to selling gasolir.e directly throu!'h C and D stations, Texaco sells indirectly thJ'ough consignees (B acco' Jnts) and independent distributors (E accounb), who operate bulk storage jJlant, purchase Texaro p1' oducts and sce them to seJ' vice station deal Frs and consumers. '3 In 1955 Texaco had approximately 30 000 contract and lessee d"ale1" stations: Atlantic had app oximateJy 5 000 service stations. 381 U. . at 363. FEDERAL TRADE eommission DECISIONS Opinion 69 F.

lantic dealers of Goodyear and Firestone products for the six-year period June 1950-June 1956 amounted to about $50 mmion. Goodrich and Firestone sold almost $60 million in TBA products to Texaco dealers in the year 1956 alone. In the five-year period 1952-1956, the sales of the sponsored Goodrich and Firestone TBA to Texaco amounted to approximately $245 mmion. The economic dependence of Texaco dealers is no different from that of Atlantic dealers. Thus, Texaco lessee dealers, who constitute the most important segment of service station TBA outlets have the same kind of short term leases, renewable on a year-toyear basis and terminable at year s end upon ten days' notice of either party. These leases contain the same kind of general housekeeping" requirements concerning the station s use, maintenance and appearance which, if breached, can result in immediate cancellation by Texaco without notice to the lessee. The lessees have often made a considerable investment in their stations at times, on funds borrowed from Texaco. "Contract dealers who own their stations or lease them from third parties, nevertheless lease their pumps and other equipment from Texaco. Both lessee and contract dealers purchase their gasoline pursuant to an "Agreement of Sale " prescyjbing annual minimum and maximum purchases at current Texaco prices. These "Agreements of Sale" also are generally on a year-to-year basis, terminable at year s end upon thirty days' notice, and automatically cancelled if a lessee dealer s lease is terminated. In these circumstances, the competitive advantage given a TBA supplier whose products are sponsored by Texaco need hardly depend upon the use of overtly coercive tactics. Here, as in Atlantic Texaco s "promotional" efforts in carrying out its sales commission agreement with Goodrich and Firestone constitute a forceful exercise of its economic power over its dealers. Its consequence is to impress upon Texaco dealers, through constant repetition and in a variety of ways, that Texaco, whose favor the dealer must court, has a strong interest in their purchase of the sponsored TBA products.

Even before the dealer has been accepted, Texaco begins its campaign on behalf of the sponsored TBA products. Texaco personnel, when intervie\ving prospective dealers for new or established service stations, advised them of the importance of TBA recommending the TBA products of Goodrich and Firestone. Once the dealer is selccted, and before he opens his station, Texaco frequently informs Goodrich and Firestone of the prospective open- THE B. F. GOODRICH CO. ET AL.

Opinion ing of his station, affording Goodrich and Firestone a head start over competitors in the initiation of their own sales campaign on behalf of their products. Thereafter, Texaco, often with the direct assistance and participation of the rubber companies, maintains a continuous campaign designed to induce the dealer to purchase the sponsored TEA products. Dealer meetings and training courses designed to educate the dealer in the use of TEA products utilize the products of the sponsored companies. Texaco participates in the sponsored companies' seasonal and special sales, promotional and advertising campaigns. Texaco publications sent to its dealers carry displays of the sponsored TEA products. And perhaps most effective of all, the Texaco salesman continually carries the message in his day-to-day contacts with the dealers. In this regard, it is important to remember that these Texaco salesmen, who are most directly involved in pushing the sponsored TEA products, also playa critical role in the annual dealer evaluations and in the determination of whether the dealer s lease and contractual relations with Tcxaco are to be renewcd. At the same time, Texaco, in making promotions, evaluates these salesmen performances in part by their success in sellng sponsored TEA prod ucts.

Frequently, both the Texaco and rubber company salesmen call upon the dealer together ("double teaming ) . The Supreme Court in Atlantic noted the inherently coercive effect of that device pointing out that since "the annual dealer evaluation by Atlantic salesmen carried substantial weight when the district managers decided upon annual lease extensions. . . dealers were. . . understandably susceptible to the encouragement of Goodyear salesmen when Atlantic men were nearby looking over their shouldders. " (381 U. S. at 375. ) And, as in Atlantic each dealer s performance as a purchaser of sponsored TEA is also fully disclosed by the reports furnished by the sponsored rubber companies to Texaco of the amount of sponsored TEA purchased by each dealer. As the record indicates, Texaco, in accessing the economic success of service stations, was vitally concerned with the amount of sponsored TEA sold by its dealers.

Here, as in Atlantic there was substantial testimony by nonsponsored TEA suppliers confirming the conclusion that, as a result of Texaco s vigorous sales campaign to its dealers, many Texaco dealers were left with the impression that Texaco would look with disfavor upon their purchase of non-sponsored TEA products and that they were required to purchase the sponsored TEA. Opinion 69 F.

As a result, these non-sponsored suppliers were unable to gain access to these Texaco service station outlets. In sum, the Supreme Court' s characterization of the operation of the sales commission plan in Atlantic is equally applicable here. Texaco, with Goodrich' s "encouragement and assistance, has marshal1ed its full economic power in a continuing campaign to force its dealers and wholesalers to buy (GoodrichJ products (id. at 371). Respondents argue that there are a number of factual distinctions between this case and Atlantic. But as we read Atlantic none of these distinctions is material. As already demonstrated under Atlantic it is the oil company s power over its dealers, and the exercise of that power through the performance of the promotional services required by the sales commission agreement and not coercive tactics, which condemns the sales commission plan. And while, unlike A tlantic the sales commission plans involved here did not allocate territories between the sponsored TBA suppliers, the gravest danger to competition presented by the sales commission plans here as in Atlantic is in their capacity for hindering competition between sponsored and non-sponsored TBA suppliers. A device which may enhance the position of two or three leading TBA suppliers vis- vis smaller competitors cannot be defended on the ground that it still leaves these few firms free to "compete" with one another for access to the Texaco service station market.

Respondents also argue that, unlike A tlantic there is here no showing that Texaco s promotional campaign was effective. Thus they contend that the statistics show that only about 30;/0 of Texaco s dealers purchased sponsored TBA products. This figure however, is derived by considering the number of Texaco dealers purchasing sponsored TBA in proportion to the total number of lessee and contract dealers. In fact, however, as respondent Goodrich, itself, points out," many contract dealers do not handle and are not appropriate outlets for, TBA products. Since more than half of the total number of Texaco dealers are made up of contract dealers, the actual success of Texaco s sales commission plans would appear to be considerable indeed. But, under Atlantic proof of the actual effectiveness of the sales commission plan is unnecessary. The Court's ultimate concern was with the cumulative danger presented by the "wide-spread use" of the plans rather than the relative effectiveness of particular plans. More- H Brief of Respondent The B. . Goodrich Company, In Answer to Appeal Brief of Counsel Supporting the GompJaint. dated March 28 , 1960 , p. 28. THE B. F. GOODRICH eo. ET AL.

Opinion over, the Court viewed the sales commission plan when used by a major oil company as having the same competitive characteristics as a tying agreement. As in the case of a tying agreement, the fact that the sales commission plan has not fully achieved its purpose, or that nonsponsored suppliers can overcome the unfair competitive advantage which the sales commission gives the sponsored supplier, is no defense. Ct. International Salt Co. v. United States 332 US. 392 , 397; Northern Pacific R. Co. v. United States 356 V. S. 1 , 12; Osborn v. Sinclair Refining Co. 286 F. 2d 832 838 (4th Cir. 1960), cert. denied 366 U. S. 963. In essence, respondents urge upon us the rationale of the District of Columbia Circuit' s opinion-that despite the economic dependence of the Texaco dealer upon Texaco, Texaco s vigorous promotional activities under the sales commission plan are nothing more than the "recommendations " of a salesman to a purchaser "free to accept or rej ect" them. In affrming the Seventh Circuit' s decision in Atlantic the Supreme Court rejected that position.

We think that orders against both Texaco and Goodrich, identical with the orders against Atlantic and Goodyear which were affirmed by the Supreme Court, are appropriate here. Texaco should clearly be enj oined from entering into or performing any sales commission plan. As to Goodrich, like Goodyear, it was " silent or inactive partner in the implementation of the sales-commission plan" (381 U.S. at 373). As the record demonstrates, the sales commission plan here is essentially a joint effort in which the massive power of a major rubber company and a major oil company is united, to the disadvantage of non-sponsored competitors, behind the sale of the rubber company s TEA products. Goodrich now has sales commission plans with five other oil companies: Continental, Shell-American, Jenney, Ohio Oil and Emblem. Its sales commission plans with these companies are substantially the same as those it has with Texaco. There is nothing in this record to indicate that these oil companies do not also have the kind of economic power possessed by Texaco over its dealers. We would not be justified in concluding that any of these other plans, unlike Goodrich' s plan with Texaco, was not an attempt to buy the economic power of the oil company over its dealers in order to obtain an unfair competitive advantage over competing rubber companies. The order therefore prohibits Goodrich from FEDERAL TRADE COMMISSIOK DECISIONS Final Order 69 F.

entering into or carrying out any sales commission plan. If Goodrich should come forward with facts establishing that it has a sales commission plan with any oil company which does not possess economic power over its dealers, the proceeding can always be reopened for such modification of the order as may be warranted. See Atlantic Refining Co. v. , supra at 377. Chairman Dixon and Commissioner :vacIntyre did not participate in this decision.

FINAL ORDER By its order dated June 16, 1965, the Court of Appeals for the District of Columbia Circuit remanded this case to the Commission for further proceedings in conformity with the opinion of the Supreme Court herein dated June 7 , 1965 (7 S.&D. 1263J. Pursuant thereto, the Commission heard oral argument and received written briefs, and fully considered, on the basis of the entire record, a11 questions of fact and law presented by the appeals from the hearing examiner s revised initial decision of September , 1962 (62 F. C. 1172, 1177J. For the reasons stated in the accompanying opinion of the Commission It is ordered That:

The revised initial decision of the hearing examiner be, and it hereby is, modified as follows:

(1) Findings 10 (b), 32, 33, 34, and conculsion 7 are stricken. (62 F. C. at 1182, 1191 , 1192, 1194J (2) The first sentence of finding 8 (62 F. C. at 1181J is deleted, and the following is substituted therefor: "Tires, batteries and accessories have become a necessary and integral part of the business operation of the ordinary Texaco dealer, and in particular for Texaco s lessee dealers.

(3) The last sentence of finding 20 (62 F. C at 1187J is deleted, and the following is substituted therefor: " It would be unusual to expect that a Texaco salesman would vigorously insist to a dealer that he had a right to buy wherever he might wish when Texaco s evaluation of the salesman s performance was in part based upon his success in selling sponsored TBA products to the dealer.

(4) The second sentence in finding 26 (62 F. C. at 1189J is deleted, and the following is substituted therefor: "There are written contracts with Texaco, Conoco, and Ohio-Marathon, but THE B. F. GOODRICH CO. ET AL.

Final Order there are no formal contracts with the other three oil companies which are smaller local concerns. Shell-American and Jenney operate generally with only service station customers selling at the retail level, but without wholesale outlets such as consignees, jobbers, and distributors.

(5) The second sentence in finding 30 (62 F. C. at 1190) is deleted, and the following is substituted therefor: "From 1952 to the end of 1955, the number of Conoco leased stations increased from 1 138 to 1 765.

(6) The last sentence of finding 31 (62 F. C. at 1190-1191), and the chart immediately below, are deleted, and the following substituted therefor: " Outlets of the additional oil companies having sales commission contracts with Goodrich during the years 1953-55 were as follows:

12-31-53 12-31-54 12-31- Conoco 1508 1061 1272Shel1-AmericanJenney Mfg. 53 66 201Ohio Oil 138 188 804Emblem 594 666 30 2598 1876 2201 (7) The first sentence of conclusion 5 (62. F. C. at 1194) is deleted, and the following is substituted therefor: "Practically al1 of the representatives of the competitors of Goodrich called as witnesses testified generally that they had diffculty in selling TBA to Texaco stations and testified specifically as to the reasons given by certain Texaco dealers for not buying or sellng their TBA items.

The hearing examiner s revised initial decision of September , 1962 (62. F. T. C. 1172 , 1177), as hereinabove modified and supplemented by the accompanying opinion, and the order contained in said revised initial decision be, and they hereby are adopted as the decision and order of the Commission. The respondents shall, within sixty (60) days after service upon them of this order, fie with the Commission a report writing setting forth in detail the manner and form of their compliance with this order.

Chairman Dixon and Commissioner MacIntyre not participating.

FEDERAL TRADE eOMMISSIOX DECISIONS Complaint 69 F.