Marcus Brothers Textile Corporation

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

IN nm MATTER MARCUS BROTHERS TEXTILE CORPORATION, ET AL. CONSENT ORDER, ETC. , IN RECORD TO THE ALLEGED VIOI,ATION OF THE FEDERAL TRADE COMMISSION AND Tile TEXTILE FIBER PRODUCTS IDENTIFICATION ACTS Docket C-1477. Complaint, Jan. 196.9-Decision, Jan. , 1969 Consent order requiring a New Yark City converter of greige textile fabrics to cease misbranding its textie fiber products, misrepresenting that it has mills and factories, and failing to maintain required records. 106 Complaint COMPLAINT Pursuant to the provisions of the Federal Trade Commission Act and the Textile Fiber Products Identification Act, and by virtue of the authority vested in it by said Acts, the Federal Trade Commission, having reason to believe that Marcus Brothers Textile Corporation, a corporation, and Samuel A. Marcus, individually and as an offcer of said corporation, hereinafter referred to as respondents, have violated the provisions of said Acts and Rules and Regulations promulgated under the Textile Fiber Products Identification 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 Marcus Brothers Textile Corporation is a corporation organized, existing and doing business under and by virtue of the Jaws of the State of New York. Respondent Samuel A. Marcus is an offcer of said corporation. He formulates, directs and controls the acts, practices and policies of the corporate respondent including the acts and practices hereinafter referred to.

Respondents are converters of greige textile fabrics for the women s wear manufacturing trade, with their omce and principal place of business Jocated at 1150 Broadway, New York New York.

PAR. 2. Respondents are now and for some time last past have been engaged in the intruduction, delivery for introduction, manufacture for introduction, sale, advertising, and offering for sale in commerce, and in the transportation OJ" causing to be transported in commerce, and in the importation into the United States, of textile libel' products; and have sold, offered for sale advertised, delivered, transported and caused to be transported textile fiher products, which have been advertised or offered for sale in commerce; and have sold, offered for sale, adverUsed delivered, transported and caused to be transported, after shipment in commerce, textile fiber products, either in their original state or contained in other textile fiber products, as the terms commerce" and "textile fiber product" are ctefineo in the Textile Fiber Products Identification Act.

PAR. 3. Certain of said textilc fiber products were misbranded by respondents in that they were not stamped, tagged, labeled or otherwise identified to show each element of information Complaint 75 F.

required under the provisions of Section 4 (b) of the Textile Fiber Products Identification Act, and in the manner and form as prescribed by the Rules and Regulations promulgated under said Act.

Among such misbranded textile fiber products, but not limited thereto, were fabrics with labels on or affxed thereto which failed:

(a) to disclose the true generic name of the fibers present; and (b) to disclose the name of the country where textile fiber products imported by them were processed or manufactured. PAR. 4. Certain of said textile fiber products were misbranded in violation of the Textile Fiber Products Identification Act in that they were not labeled in accordance with the Rules and Regulations promulgated thereunder in that fiber trademarks were used in eonjunction with required information on labels affxed to such fiber products, without the generic name of the fiber being set out in immediate conjunction therewith and in type or lettering of equal size and conspicuousness, in violation of Rule 17 (a) of the aforesaid Rules and Regulations. PAR. 5. Respondents have failed to maintain and preserve proper records showing the fiber content of the textile fiber products manufactured by them, in violation of Section 6(a) of the Textile Fiber Products Identification Act and Rule 39 of the Regulations promulgated thereunder.

PAR. 6. The acts and practices of respondents as set forth above were, and are, in violation of the Textile Fiber Products Identification Act and the Rules and Regulations promulgated thereunder, and constituted, and now constitute, unfair methods of competition and unfair and deceptive acts and practices, in commerce, under the Federal Trade Commission Act. PAR. 7. 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 he shipped from their place of business in the State of New York to purchasers thereof located in various other States of the United States, and maintain, and at all 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. In the course and conduct of their business, the aforesaid respondents, on certain of their gummed fabric labels attached to fabrics sold by them, used the term "Marbro Mills 106 Decision and Order thus stating or implying that respondents operate a mill or factory in which fal)rics sold by them are manufactured. PAR. 9. In truth and in fact, respondents do not own, opcrate or control any mi1 or factory where the aforesaid fabrics or other products sold by them are manufactured, but are engaged solely in business as converters of greige textie fabrics for the women s wear manufacturing trade.

PAR. 10. There is a preference on the part of many members of the trade to buy products directly from mils or factories, in the , in-belief that by so doing, certain advantages accrue to them cluding lower prices.

PAR. 11. In the conduct of their business, at al1 times mentioned herein, respondents have been in substantial competition, in commerce, with corporations, firms and individuals in the sale of products of the same general kind as that sold by respondents. PAR. 12. The use by respondents of the aforesaid false, misleading and deceptive statements, representations and practices has had, and now has, the capacity and tendency to mislead purchasers into the erroneous and mistaken belief that said statements and representations were and are true and into the purchase of substantial quantities of said respondents' products by reason of said erroneous and mistaken belief. PAR. 13. The aforesaid acts and practices of respondents, as andherein alleged in Paragraphs Eight through Twelve were, are, al1 to the prejudice and injury of the public and of respondents' competitors, and constituted, and now constitute, unfair methods of competition and unfair and deceptive acts and practices in commerce in violation of Section 5 (a) (1) of the Federal Trade Commission Act.

DECISION AND ORDER The Federal Trade Commission having initiated an investigation of certain acts and practices of the respondents named in the caption hereof, and the respondents having been furnished thcrcafter with a copy of a draft of complaint which the Bureau of Textiles and Furs proposed to present to the Commission for its consideration and which, if issued by the Commission, would charge respondents with violation of the Federal Trade Commission Act and the Textile Fiber Products Identification Act; and The respondents and counsel for the Commission having thereafter executed an agreement containing a consent order, an ad- Dccision and Order 75 F.

mission by the respondents of a11 the jurisdictional facts set forth in the aforesaid draft of complaint, a statement that the signing of said agreement is for settement purposes only and does not constitute an admission by respondents that the law has been violated as alleged in such complaint, and waivers and other provisions as required by the Commission s Rules; and The Commission having thereafter considered the matter and having determined that it had reason to believe that the respondents have violated the said Acts, and that complaint should issue stating its charges in that respect, and having thereupon accepted the executed consent agreement and placed such agreement on the public record and having duly considered the comment filed thereafter pursuant to 34 (b) of its Rules, now, in further conformity with the procedure prescribed in 34 (b) of its Rules, the Commission hereby issues its complaint, makes the following jurisdictional findings, and enters the following order: 1. Respondent Marcus Brothers Textile Corporation is a corporation organized, existing and doing business under and by virtue of the laws of the State of New York, with its offce and principal place of business located at 1450 Broadway, N ew York New York.

Respondent Samuel A. Marcus is an offcer of said corporation and his address is the same as that of 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.

ORDF,R It is ordered That respondents Marcus Brothers Textile Corporation, a corporation, and its offcers, and Samuel A. Marcus individually and as an offcer of said corporation, and respondents representatives, agents and employees, directly or through any corporate or other device, in connection with the introduction delivery for introduction, manufacture for introduction, sale, advertising, or offering for sale, in commerce, or the transportation or causing to be transported in commerce, or the importation into the United States, of any textile fiber product; or in connection with the sale, offering for sale, advertising, delivery, transportation or causing to be transported, of any textile fiber product which has been advertised or offered for sale in commerce; or in connection with the sale, offering for sale, advertising, delivery, transportation, or causing to be transported, after 106 Decision and Order shipment in commerce, of any textile fiber product, whether in its original state or contained in other textile fiber products, as the terms "commerce" and "textile fiber product" are defined in the Textie Fiber Products Identification Act, do forthwith cease and desist from:

A. Misbranding such products by:

1. Failing to affx a stamp, tag, label, or other means of identification to each such product showing in a clear lcgible and conspicuous manner each element of information required to be disclosed by Section 1(b) of the Textile Fiber Products Identification Act. 2. Using a fiber trademark in conjunction with the required information on labels affxed to said textie fiber products without the generic name of the fiber appearing on said labels in immediate conjunction therewith and in type or lettering of equal size and conspicuousness.

B. Failing to maintain and preserve records of fiber content of textile fibcr products manufactured by them, as required by Section 6(a) of the Textile Fiber Products Identification Act and Rule 39 of the Regulations promulgated thereunder.

It is further order-d That respondents Marcus Brothers Textile Corporation, a corporation, and its offcers, and Samuel A. Marcus, individually and as an officer of said corporation, and respondents' representatives, agents and employees, directly or through any corporate or other device, in conllection with the advertising, offering for sale, sale or distribution of textile fabrics or other productf; in commerce, as "commerce" is defined in the Federal Trade Commission Act, do forthwith cease and desist from:

1. Directly or indirectly using the word "Mills, or any other word or term of similar import or meaning in or as a part of respondents' corporate or trade name, or representing in any other manner that respondents perform the functions of a mil or otherwise manufacture textile fabrics or other products sold by them unless and until respondents own or opcrate, or directly and absolutely control the mil, factory or manufacturing plant wherein said textile fabrics or other products are manufactured.

2. Misrepresenting in any manner that respondents have Complaint 75 F.

mills, factories or manufacturing plants where their products are man uf actured.

It is further ordered That the respondent corporation shall forthwith distribute a copy of this order to each of its operating divisions.

It i8 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 have complied with this order.