Hasbro Industries, Inc

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IN THE MATTER OF HASBRO INDUSTRIES, INC.

CONSENT ORDER, ETC., IN REGARD TO ALLEGED VIOLATION OF THE FEDERAL TRADE COMMISSION ACT Docket 274B. Complaint, Oct. 197.5-Decision, Oct. , 197.'; Consent order requiring a Pawtucket, R.I., seller and distributor of toy, gift and hobby products, among other things to cease deceptively packaging its merchandise.

Appearances For the Commission: Pamela H. Feinstein and Larr B. Fe-instein. For the respondent: David Greene, Aberman, GreeTw and Locker New York City.

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 Hasbro Industries Inc., a corporation, hereinafter referred to as respondent, has violated the provisions of 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 Hasbro Industries, Inc. is a corporation organized, existing and doing business under and by virtue of the laws of the State of Rhode Island, with its principal offce and place of business located at 1027 Newport Ave., Pawtucket, R. PAR. 2. Respondent is now, and for some time last past has been engaged in the advertising, offering for sale, sale and distribution of hobby products, toy craft products and activity toys to jobbers and retailers to the public.

PAR. 3. In the course and conduct of its business, respondent now causes, and for some time last past has caused, said products, when sold, to be shipped from its place of business in the State of Rhode Island to purchasers thereof located in various other States of the United States, and maintains, and at all times mentioned herein has maintained, a substantial course of trade in said products in or affecting commerce, as "commerce" is defined in the Federal Trade Commission Act.

PAR. 4. Among the products which are offered for sale and sold by 1010 FEDERAL TRAm; COMMISSION DECISIONS Complaint 86 F.TC. the respondent are a number of hobby products, toy craft products and activity toys. Through the use of certain methods of packaging, respondent has represented, and has placed in the hands of others the means and instrumentalities through which they might represent directly or indirectly, that certain of the above products, as depicted or otherwise described on the exteriors of packages, corresponded in their lengths and widths, or their lengths, widths and thicknesses, with the boxes in which they were contained, and that others of such products were offered in quantities reasonahly related to the size of the containers in which they were presented for sale. PAR. 5. Typical and illustrative of said products as described in Paragraph Four, but not all inclusive thereof, are the following: Spangle Beads Indian Princess Bead Craft Popeye Paint and Crayon Set Embroidery Round Knit Foil Art Crocheting PAR. 6. In truth and in fact, such products often have not corresponded with their container or package dimensions and are often not offered in quantities reasonably related to the sizes of the containers or packages in which they are presented for sale. Purchasers of such a product are thereby given the mistaken impression that they are receiving a larger product or a product of greater volume than is actually the fact.

Therefore the methods of packaging referred to in Paragraph Four hereof were and are unfair and false, misleading and deceptive. PAR. 7. In the conduct of its business, at all times mentioned herein respondent has been in substantial competition, in or affecting commerce, with corporations, firms and individuals in the sale of products of the same general kind and nature as the products sold by the respondent.

PAR. 8. The use by respondent of the aforesaid unfair, false misleading and deceptive methods of packaging has had, and now has the capacity and tendency to mislead members of the purchasing public into the erroneous and mistaken belief that the quantum or amount of the product being sold was and is greater than the true such quantum or amount, and into the purchase of substantial quantities of respondent' s product by reason of said erroneous and mistaken belief. PAR. 9. The aforesaid acts and practices of the respondent, as herein alleged, were and are all to the prejudice and injury of the public and of respondent's competitors and constituted, and now constitute, unfair 1009 Decision and Order methods of competition and unfair and deceptive acts and practices in or affecting commerce, in violation of Section 5 of the Federal Trade Commission Act.

DECISION AND ORDER The Federal Trade Commission having initiated an investigation of certain acts and practices of the respondent named in the caption hereof, and the respondent having been furnished thereafter with a copy of a draft of complaint which the New York Regional Office proposed to present to the Commission for its consideration and which if issued by the Commission, would charge respondent with violations ofthe Federal Trade Commission Act; and The respondent and counsel for the Commission having thereafter executed an agreement containing a consent order, an admission by the respondent of all 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 respondent that the law has been violated as alleged in such complaint and waivers and other provisions as required by the Commission rules; and The Commission having thereafter considered the matter and having determined that it has reason to believe that the respondent has violated the said Act, 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 sixty (60) days, and having duly considered the comments filed thereafter pursuant to Section 2.34 of its rules, now in further conformity with the procedure prescribed in Section 2.34 of its rules the Commission hereby issues its complaint, makes the following jurisdictional findings, and enters the following order: 1. Respondent sbro Industries, Inc. is a corporation organized existing and doing business under and by virtue of the laws of the State of Rhode Island, with its office and principal place of business located at 1027 Newport Ave., Pawtucket, R.

2. The B'ederal Trade Commission has jurisdiction of the subject matter of this proceeding and of the respondent, and the proceeding is in the public interest.

ORDER It is ordered That respondent Hasbro Industries, Inc., a corporation and its officers, and respondent's agents, representatives, employees successors and assigns, directly or through any corporation, subsidiary, Decision and Order 86 ,' division or other device, in connection with the offering for sale, sale or distribution of hobby products, toy craft products and activity toys, in or affecting commerce, as "commerce" is defined in -the Federal Trade Commission Act, do forthwith cease and desist from: 1. Packaging said products in oversized boxes or other containers so as to create the appearance or impression that the width or thickness or other dimensions or quantity of products contained in a box or container is appreciably greater than is the fact; but nothing in this order shall be construed as forbidding respondent to use oversized containers if respondent justifies the use of such containers as necessary for the efficient packaging of the products contained therein and establish that respondent has made all reasonable efforts to prevent any misleading appearance or impression from being created by such containers;

2. Providing wholesalers, retailers or other distributors of said products with any means or instrumentality with which to deceive the purchasing public in the manner described in Paragraph (1) above. It is further ordered That respondent or its successors or assigns notify the Commission at least 30 days prior to any proposed change in the corporate respondent such as dissolution, assignment or sale resulting in the emergence of a successor corporation, the creation or dissolution of subsidiaries or any other change in the corporate respondent which may affect compliance obligations arising out of this order.

It is further ordered That respondent distribute a copy of this order to all operating divisions and subsidiaries of said corporation. It is further ordered That the respondent herein shall within sixty (60) days after service upon it of this order, file with the Commission a report, in writing, setting forth in detail the manner and form in which it has complied with this order.