Checkpoint Systems, Inc

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IN THE MA TTER OF CHECKPOINT SYSTEMS, INC CONSENT ORDER, ETC., IN REGARD TO ALLEGED VIOLA non OF SEC. 5 OF THE FEDERAL TRADE COMMISSION ACT Docket C-3796. Comp/aillt *1 Apri/6, 1998--Decision, Apri/6, 1998 This consent order prohibits, among other things, the New Jersey-based manufacturer of electronic article surveillance equipment from entering into any agreement that prohibits, restricts, impedes, interferes with, restrains places limitations on, or advises against engaging in trthful, non-deceptive advertising, comparative advertising or promotional and sales activities. In addition, the consent order nullifies the agreement, benveen Sensonnatic Electronics Corporation and Checkpoint Systems, Inc., to restrict advertising and promotional claims about each other s products or services. Appearances For the Commission: Wiliam Lanning, Michael McNeely, and Wiliam Baer, For the respondent: Frank Newell, Montgomery, McCracken Walker Rhoad Philadelphia, P A.

DECISION AND ORDER The Federal Trade Commission ("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 Bure;w of Competition proposed to present to the Commission for its consideration and which, if issued by the Commission, would charge the respondent with violation 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 respondent 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 respondent that the Jaw has been violated as alleged in such complaint, and waivers and other provisions as required by the Commission s Rules; and 1 * Complaint previously published at 125 FTC 587 (1998). Decision and Order 125 P. The Commssion having thereafter considered the matter and having determined that it had reason to believe that the respondent has violated the said Act, and that a 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, now in further confonnity with the procedure described in Section 2.34 of its Rules, the Commission hereby issues its complaint, makes the following jurisdictional findings and enters the following order:

I. Respondent Checkpoint Systems, lnc, is a corporation organized, existing and doing business under and by virtue of the laws of the State of Pennsylvania with its office and principal place of business located at 10 1 Wolf Dri ve, Thorofare, New Jersey. 2. The Federal Trade Commission has jurisdiction of the subject matter of this proceeding and of the respondent, and the proceeding is in the pubhc interest.

ORDER It is ordered That, as used in this order, the following definitions shall apply:

A. Respondent means Checkpoint Systems, lnc, B. Checkpoint Systems, Inc, " means Checkpoint Systems, lnc" its directors, officers, employees, agents and representatives, predecessors, successors, and assigns; its subsidiaries, divisions groups and affiiates controlled by Checkpoint Systems, lnc" and the respective directors, officers, employees, agents, and representatives successors, and assigns of each, e. Sensormatic Electronics Corporation means Sensonnatic Electronics Corporation, its directors, officers, employees, agents and representatives, predecessors, successors, and assigns; its subsidiaries, divisions, groups and affiliates controlled by Sensormatic Electronics Corporation, and the respective directors, officers, employees, agents, and representatives, successors, and assigns of each, D, EAS system means electronic article surveillance equipment including, but not Emited to, sensors, deactivation equipment, labels or tags, source tags or labels, and any other component parts or related products.

CHECKPOINT SYSTEMS, INe. 597 595 Decision and Order II, It is further ordered That within three (3) days after the date this order becomes final, respondent shall declare null and void Section 4, the "Negative Advertising" provision, oftheJune 27 1993 agreement between Sensonnatic Electronics Corporation and respondent.

It is further ordered That respondent, directly or indirectly, or through any person, corporation, subsidiary, division or other device in connection with the manufacture, advertising, offering for sale sale or distribution of any EAS system, in or affecting commerce, as commerce " is defined in the Federal Trade Commssion Act forthwith cease and desist from:

A. Entering into, attempting to enter into, organizing, continuing, or acting in furtherance of any agreement or combination, or carrying out any agreement, either express or implied, that prohibits, restricts impedes, interferes with, restrains, places limitations on, or advises against engaging in truthful, non-deceptive advertising, comparative advertising, and promotional and sales activities; and B, Encouraging, advising, pressuring, assisting, inducing, or attempting to induce any non-governmental person or organization to engage in any action prohibited by this order. IV, It is further ordered That respondent shall: A. Within thirty (30) days of the date on which this order becomes final, provide a copy of this order to all of its directors and officers;

B, For a period of three (3) years from the date on which this order becomes final, and within ten (10) days after the date on which any person becomes a director or officer of respondent, provide a copy of this order to such person; and e. Require each person to whom a copy of this order is furnished pursuant to subparagraphs IV,A and B of this order to sign and submit to its respective employer named as a respondent within thirty (30) days of the receipt thereof a statement that: (I) acknowledges receipt of the order; (2) represents that the undersigned has read and understands the order; and (3) acknowledges that the undersigned has been advised and understands that non-compliance with the order may subject the respondent to civil penalties for violation of the order.

Decision and Order 125 F.T. It is further ordered That respondent shall: A, Within sixty (60) days from the date on which this order becomes final, and annually thereafter for three (3) years on the anniversary of the date this order becomes final, and at such other times as the Commssion may by written notice to the respondent require, file with the Commssion a verified written report setting forth in detail the manner and form in which respondent has complied and is complying with this order;

B. For a period of three (3) years after the order becomes final maintain and make available to the staff of the Federal Trade Commssion for inspection and copying, upon reasonable notice, all records of communications with EAS competitors of respondent relating to any aspect of advertising, and records pertaining to any action taken in connection with any activity covered by parts II, II , and V of this order; and e. Notify the Commission at least thirty (30) days prior to any proposed change in corporate respondent such as dissolution assignment, sale resulting in the emergence of a successor corporation, or the creation or dissolution of subsidiaries or any other change in the corporation that may affect compliance obligations arising out of this order.

VI.

It is further ordered That this order shall tenninate on April 6, 2018.

Commssioner Thompson and Commissioner Swindle not participating.

ROGER 1. CALLAHAN 599 599 Complaint