Lourie'S Inc

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IN THE MATTER OF LOURIE' S, INC., ET AL.

CONSENT ORDER, ETC. , IN REGARD TO THE ALLEGED VIOLATION OF THE I'EDERAL TRADE COMMISSION AND Tile FUR PRODUCTS LABELING ACTS Jan. , 196. Docket C-148l;. Complaint, Jan. 1969-Decision Consent order requiring a Columbia, S. , retailer of ladies' and men s ready to wear clothing to cease misbranding, falsely advertising and invoicing its fur products, removing required labels, and failing to maintain required records.

COMPLAINT Pursuant to the provisions of the Federal Trade Commission Act and the Fur Products Labeling Act, and by virtue of the authority vested in it by said Acts, the Federal Trade Commission having reason to believe that Lourie, Inc. , a corporation, and Abraham M. Lourie, individually and as an offcer of said corporation, hereinafter referred to as respondents, have violated the provisions of said Acts and the Rules and Regulations promulgated under the Fur Products Labeling' Act, and it appearing to Complaint 75 F.

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 Lourie, Inc., is a corporation organized, existing- and doing business under and by virtue of the laws of the State of South Carolina.

Respondent Abraham M. Lourie is an offcer of the corporate respondent. He formulates, directs and controls the acts, practices and policies of the said corporate respondent including those hereinafter set forth.

Respondents arc retailers of ladies' and men s ready to wear and rclated accessories with their offce and principal place of business located at 1601 Main Street, Columbia, South Carolina. PAR. 2. Respondents are now and for some time last past have been engaged in the introduction into commerce, and in the sale advertising, and offering for sale in commerce, and in the transportation and distribution in commerce, of fur products; and have sold, advertised, offered for sale, transported and distributed fur products which have been made in whole or in part of furs which have bccn shipped and received in commerce, as the terms "commerce fur" and " fur product" are defined in the Fur Products Labeling Act.

PAR. 3. Respondents have removed and have caused and participated in the removal of, prior to the time fur products subject to the provisions of the Fur Products Labeling- Act were sold and delivered to the ultimate consumer, lahels required by the Fur Products Labeling Act to be affxcd to such products, in violation of Section 3(d) of said Act. PAR. 4. Certain of said fur products were misbranded in violation of Section 4 (1) of the Fur Products Labeling Act in that they were falsely and deceptively labeled or otherwise falsely and deceptively identified in that labels affxed to such fur products contained representations, either directly or by implication, that the prices of such fur products were reduced from respondents former prices and the amount of such purported reductions constituted savings to purchasers of respondents' fur products. In truth and in fact, the allegcd former prices were fictitious in that they were not actual, bona fide prices at which respondents offered the products to the public on a regular basis for a reasonably substantial period of time in the recent regular course of business and the said fur products were not reduced 179 Complaint in price as represented and savings were not afforded purchasers of respondents' said fur products, as represented. PAR. 5. Certain of said fur products were misbranded in that they were not labeled as required under the provisions of Section 4 (2) of the Fur Products Labeling Act and in the manner and form prescribed by the Rules and Regulations promulgated thereunder.

Among such misbranded fur products, but not Jimited thereto were fur products with labels which failed to show the true animal name of the fur used in such fur products. PAR. 6. Certain of said fur products were misbranded in violation of the Fur Products Labeling Act in that they were not labeled in accordance with the Rules and Regulations promulgated thereunder in the following- respects: (a) The term "natural" was not used on labels to describe fur products which were not pointed, bleached, dyed, tip-dyed, or otherwise artificially colored, in violation of Rule 19(9) of said Rules and Regulations.

(b) Required item numbers were not set forth on labels, in violation of Rule 40 of said Rules and Regulations. PAR. 7. Certain of said fur products were falsely and deceptively invoiced by the respondents in that they were not invoiced as required by Section 5(b) (1) of the Fur Products Labeling- Act and the Rules and Regulations promulgated under such Act.

Among- such falsely and deceptively invoiced fur products but not limited thereto, were fur products covered by invoices which failed to show the true animal name of the fur used in any such fur product.

PAR. 8. Certain of said fur products were falsely and deceptively invoiced in violation of the Fur Products Labeling Act in that they were not invoiced in accordance with the Rules and Regulations promulgated thereunder in the following respects: (a) Information required under Section 5(b) (1) of the Fur Products Labeling Act and the Rules and Regulations promulgated thereunder was set forth on invoices in abbreviated form in violation of Rule 4 of said Rules and Regulations. (b) The term "natural" was not used on invoices to describe fur products which were not pointed, bleached, dyed, tip-dyed, or otherwise artificially colored, in violation of Rule 19 (g) of said Rules and Regulations.

Complaint 75 (c) Required item numbers were not set forth on invoices, in violation of Rule 40 of said Rules and Regulations. PAR. 9. Certain of said fur products were falsely and deceptively advertised in violation of the Fur Products Labeling Act in that certain advertisements intended to aid, promote and assist, directly or indirectly, in the sale and offering for sale of such fur products were not in accordance with the provisions of Section 5(a) of the said Act.

Among and included in the aforesaid advertisements but not limited thereto, were advertiscments of respondents which appeared in issues of The State, a newspaper published in the city of Columbia, State of South Carolina and having a wide circulation in South Carolina and in other States of the United States.

By means of the aforesaid advertisements and other advertisements of similar import and meaning not specifically referred to herein, respondents falsely and deceptively advertised fur products, in violation of Section 5(a) (5) of the Fur Products Labeling Act and Rule 44(a) of the Rules and Regulations promulgated thereunder by representing, directly or by implication that the prices of such fur products were reduced from respondents' former prices and the amount of such purported reductions constituted savings to purchasers of respondents' fur products. In truth and in fact, the alleged former prices were fictitious in that they were not actual, bona fide prices at which respondents offered the products to the public on a regular basis for a reasonably substantial period of time in the recent regular course of business and the said fur products were not reduced in price as represented and savings were not afforded purchasers of respondents' said fur products, as represented. PAR. 10. In advertising fur products for sale, as aforesaid respondents made pricing claims and representations of the types covered by subsections (a), (b), (c) and (d) of Rule 44 of the Regulations under the Fur Products Labcling Act. Respondents in making such claims and representations failed to maintain full and adequate records disclosing the facts upon which such claims and representations were based, in violation of Rule 44(e) of said Rules and Regulations. PAR. 11. The aforesaid acts and practices of respondents, as herein alleged, are in violation of the Fur Products Labeling Act and the Rules and Regulations promulgated thereunder and constitute unfair methods of competition and unfair and de- 179 Decision and Order ceptive acts and practices in commerce under 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 thereafter 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 Fur Products Labeling Act; and The respondents and counsel for the Commission having thereafter executed an agreement containing a consent order, an admission by the respondents of all the jurisdictional facts set forth in the aforesaid draft of complaint, a 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 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 for a period of thirty (30) days, 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 Lourie, Inc., is a corporation organized, existing and doing business under and by virtue of the laws of the State of South Carolina, with its offce and principal place of business located at 1601 Main Street, Columbia, South Carolina. Respondent Abraham M. Lourie 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.

ORDER It is f'dated That respondents Lourie e Inc. , a corporation Decision and Order 75 F. and its offcers, and Abraham M. Lourie, 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 into commerce or the sale, advertising or offering for sale in commerce, or the transportation or distribution in commerce, of any fur product; or in connection with the sale, advertising, offering for sale, transportation or distribution, of any fur product which is made in whole or in part of fur which has been shipped and received in commerce, as the terms "commerce fur" and Hfur product" are defined in the Fur Products Labeling Act, do forthwith cease and desist from:

A. Misbranding any fur products by:

1. Representing, directly or by implication on a label that any price whether accompanied or not by descriptive terminology is the respondents' former price of such fur product unless such price is the price at which such fur product has been sold or offered for sale in good faith by the respondents in the recent regular course of business, or otherwise misrepresenting the price at which such fur product has been sold or offered for sale by respondents.

2. Falsely or deceptively representing on a label that savings are afforded to the purchaser of any such fur product or misrepresenting in any manner on a label or other means of identification the amount of savings available to the purchaser of such fur product. 3. Misrepresenting in any manner on a label that the price of such fur product is reduced.

4. Failing to affx a label to such fur product showing in words and in figures plainly legible all of the information required to be disclosed by each of the subsections of Section 4(2) of the Fur Products Labeling Act.

5. Failing to set forth the term "natural" as part of the information required to be disclosed on a label under the Fur Products Labeling Act and the Rules and Regulations promulgated thereunder to describe such fur product which is not pointed, bleached, dyed tip-dyed, or otherwise artificially colored. 6. Failing to set forth on a label the item number or mark assigned to such fur product.

179 Decision and Order B. Falsely or deceptively invoicing any fur product by: 1. Failing to furnish an invoice, as the term "invoice" is defined in the Fur Products Labeling Act, showing in words and figures plainly legible all the information required to be disclosed by each of the subsections of Section 5(b) (1) of the Fur Products Labeling Act.

2. Setting forth information required under Section 5(b) (1) of the Fur Products Labeling Act and the Rules and Regulations promulgated thereunder in abbreviated form.

3. Failing to set forth the term "natural" as part of the information required to be disclosed on an invoice under the Fur Products Labeling Act and Rules and Regulations promulgated thereunder to describe such fur product which is not pointed, bleached, dyed tip-dyed, or otherwise artiflcially colored. 4. Failing to set forth on an invoice the item number or mark assigned to such fur product.

C. Falsely or deceptively advertising any fur product through the use of any advertisement, representation, public announcement or notice which is intended to aid, promote or assist, directly or indirectly, in the sale, or offering for sale of any such fur product, and which: 1. Represents, directly or by implication that any price, whether accompanied or not by descriptive terminology is the respondents' former price of such fur product unless such price is the price at which such fur product has been sold or offered for sale in good faith by the respondents in the recent regular course of business, or otherwise misrepresents the price at which any such fur product has been sold or offered for sale by. respondents.

2. Falsely or deceptively represents that savings are afforded to the purchaser of any such fur product or misrepresents in any manner the amount of savings afforded to the purchaser of such fur product. 3. Falsely or deceptively represents that the price of any such fur product is reduced.

D. Failing to maintain full and adequate records disclosing the facts upon which pricing claims and representations of the types described in subsections (a), (b), (c) and Complaint 75 F.T.C.

(d) of Rule 44 of the Rules and Regulations promulgated under the Fur Products Labeling Act, are based. It is further ordered, That respondents Lourie’s, Inc., a corporation, and its officers, and Abraham M. Lourie, individually and as an officer of said corporation, and respondents’ representatives, agents and employees, directly or through any corporate or other device, do forthwith cease and desist, except as provided in Section 3(e) of the Fur Products Labeling Act, from removing or causing or participating in the removal of, prior to the time any fur product subject to the provisions of the Fur Products Labeling Act is sold and delivered to the ultimate consumer, any label required by the said Act to be affixed to such fur product, without substituting therefor a label conforming to Section 4(2) of said Act.

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

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 have complied with this order.