Lanz of California, Inc

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In THe Marrer or LANZ OF CALIFORNIA, INC., ET AL.

CONSENT ORDER, ETC., IN REGARD TO THE ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSION AND THE FLAMMABLE FABRICS ACTS | Docket C-1908. Complaint, Apr. 26, 1971—Decision, Apr. 26, 1971 Consent order requiring a Los Angeles, Calif., importer and distributor of textile fiber products, including silk scarves, to cease violating the Flammable Fabrics Act by importing or selling any fabric which fails to con-form to the standards of said Act.

Complaint Pursuant to the provisions of the Federal Trade Commission Act and the Flammable Fabrics Act, as amended, and by virtue of the authority vested in it by said Acts, the Federal Trade Commission, having reason to believe that Lanz of California, Ine., a corporation, and The House of a Thousand Fabrics, a corporation, and Kurt Scharff, Frank Neustatter, Joseph Basch, Werner Scharff, Margarete Rand and Emanuel Rand, individually and as officers of Complaint 78 FTC.

said corporations, hereinafter referred to as respondents, have violated the provisions of said Acts, and the Rules and Regulations promulgated under the Flammable Fabrics Act, as amended, 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: Paracrary 1. Respondent Lanz of California, Inc., is a corporation organized, existing and doing business under and by virtue of the laws of the State of California.

Respondents Kurt Scharff, Frank Neustatter, Joseph Basch, and Werner Scharff are officers of said Lanz of California, Inc., and they formulate, direct and control the acts, practices and_ policies of said corporate respondent. oe Respondent The House of a Thousand Fabrics is a corporation organized, existing and doing business under and by virtue of the laws of the State of California.

Respondents Margarete Rand, Kurt Scharff, Werner Scharff, and Emanuel Rand are officers of said The House of a Thousand Fabrics, and they formulate, direct and control the acts, practices and policies of said corporate respondent.

Respondents are engaged in the importation, sale and distribution of textile fiber products including, but not limited to, silk scarves. The office and principal place of business of Lanz of California, Inc., is located at 6150 Wilshire Boulevard, Los Angeles, California. The office and principal place of business of The House of a Thousand Fabrics is located at 611 South Fairfax Avenue, Los Angeles, California.

Par. 2. Respondents are now and for some time last past have been engaged in the sale or offering for sale, in commerce, and have imported into the United States, and have introduced, delivered for introduction, transported and caused to be transported in commerce, and have sold or delivered after sale or shipment in commerce, products, as “commerce” and “product” are defined in the Flammable Fabrics Act, as amended, which products failed to conform to an applicable standard or regulation continued in effect, issued or amended under the provisions of the Flammable Fabrics Act, as amended.

Among such products mentioned hereinabove were silk scarves. Par. 3. The aforesaid acts and practices of respondents were and are in violation of the Flammable Fabrics Act, as amended, and the Rules and Regulations promulgated thereunder, and as such constituted, and now constitute, unfair methods of competition and LANL Ui CALEEURKNIA, LNG, WY AL. 4US 701 Decision and Order ‘unfair and deceptive acts and practices in commerce within the intent and meaning 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 thereafter with a copy of a draft of complaint which the Division 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 Flammable Fabrics Act, as amended; 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 Section 2.34(b) of its Rules, the Commission hereby issues its complaint, makes the following jurisdictional findings, and enters the following order: 1. Respondent Lanz of California, Inc., is a corporation organized, existing and doing business under and by virtue of the laws of the State of California.

Respondents Kurt Scharff, Frank Neustatter, Joseph Basch and Werner Scharff are officers of said Lanz of California, Inc., and they formulate, direct and control the acts, practices and policies of said corporate respondent.

Respondent The House of a Thousand Fabrics is a corporation organized, existing and doing business under and by virtue of the laws of the State of California.

Respondents Margarete Rand, Kurt Scharff, Werner Scharff, and Emanuel Rand are officers of said The House of a Thousand Fab- 704 FEDERAL TRADE COMMISSION: DECISIONS Decision and Order ' 78 WTC.

rics, and they formulate, direct and control the acts, practices and policies of said corporate respondent.

Respondents are engaged in the importation, sale and distribution of textile fiber products, including but not limited to, silk. scarves. The office and principal place of business of Lanz of California, Inc., is located at 6150 Wilshire Boulevard, Los Angeles, California. The office and principal place of business of The House of a Thousand Fabrics is located at 611 South Fairfax Avenue, Los Angeles, California.

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 Lanz of California, Inc., a corporation, and its officers, and The House of a Thousand Fabrics, corporation, and its officers, and Kurt Scharff, Frank Neustatter, Joseph Basch, Werner Scharff, Margarete Rand, and Emanuel Rand, individually and as officers of said corporations, and respondents? representatives, agents and employees, directly or through any corporate or other device, do forthwith cease and desist from manufacturing for sale, selling, or offering for sale, in commerce, or importing into the United States, or introducing, delivering for introduction, transporting or causing to be transported in commerce, or selling or delivering after sale or shipment in commerce, any product, fabric or related material; or manufacturing for sale, selling or offering for sale products made of fabric or related material which has been shipped and received in commerce, as “commerce,’ “product,” “fabric” or “related materials” are defined in the Flammable Fabrics Act, as amended, which product, fabric or related material fails to conform to any applicable standard or regulation continued in effect, issued or amended under the provisions of the aforesaid Act.

It is further ordered, That respondents notify all of their customers who have purchased or to whom have been delivered the products which gave rise to this complaint of the flammable nature of such products and effect the recall of such products from cus- ‘tomers.

It is further ordered, That the respondents herein either process LANZ OF CALIFORNIA, INC., ET AL. 7U5 701 Decision and Order the products which gave rise to the complaint so as to bring them within the applicable flammability standards of the Flammable Fabrics Act, as amended, or destroy said products. It is further ordered, That the respondents herein shall, within ten (10) days after service upon them of this order, file with the Commission a special report in writing setting forth the respondents’ intentions as to compliance with this order. This special report shall also advise the Commission fully and specifically concerning (1) the identity of the products which gave rise to the complaint, (2) the number of said products in inventory, (3) any action taken and any further actions proposed to be taken to notify customers of the flammability of said products and effect the recall of said products from customers, and of the results thereof, (4) any disposition of said products since July 15, 1969, and (5) any action taken or proposed to be taken to bring said products into conformance with the applicable standard of flammability under the Flammable Fabrics Act, as amended, or destroy said products, and the results of such action. Such report shall further inform the Commission as to whether or not respondents have in inventory any’ product, fabric or related material having a plain surface and made of paper, silk, rayon and acetate, nylon and acetate, rayon, cotton or any other material or combinations thereof in a weight of two ounces or less per square yard, or any product, fabric or related material having a raised fiber surface. Respondents shall submit samples of not less than one square yard in size of any such product, fabric, or related material with this report.

It is further ordered, That respondents notify the Commission at least 80 days prior to any proposed change in the corporate respondents such as dissolution, assignment or sale resulting in the _ emergence of a successor corpor ation, the creation or dissolution of subsidiaries or any other change in the corporations which may affect compliance obligations arising out of the order. lt is further ordered, That the respondent corporations shall forthwith distribute a copy of this order to each of their 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. Complaint / 78 F.T.C.