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ANNUAL REPORT
OF THE

FEDERAL

TRADE COMMISSION
FOR THE

FISCAL YEAR ENDED JUNE 30, 1926

WASHINGTON
GOVERNMENT PRINTING OFFICE
1926

FEDERAL TRADE COMMISSION
JOHN F. NUGENT, Chairman.
CHARLES W. HUNT.
HUSTON THOMPSON.
WILLIAM E HUMPHREY.
VERNON W. VAN FLEET.
OTIS B. JOHNSON, Secretary.

CONTENTS
Page
Introduction
1
Legal divisions
3
Statistics and procedure on legal work
3
Legal investigating division
3
Outline of procedure
3
Summary of work, 1926
5
Board of review
6
Outline of procedure
6
Summary of work, 1926
6
Trial examiners’ division
7
Outline of procedure
7
Summary of work, 1926
8
Chief counsel
8
Outline of procedure
8
Summary of work, 1926
9
Character of complaints
10
Aluminum Co. of America
10
Continental Baking Corporation
12
Resale price maintenance
13
False claim of being “Manufacturer” or “Mills”
14
Misbranding of fur
14
Wholesale Grocers’ Association of New Orleans
14
Fictitious prices-Eclipse Fountain Pen & Pencil Co., et al
15
Furniture cases--Misbranding and misrepresentation
15
Orders to cease and desist
16
Disparagement of competitive product-Calumet Baking Powder Co
17
Acquisition of corporate stock in violation of section 7, Clayton Act-International Shine Co. case
17
Adulteration of grain
18
North Dakota Wholesale Grocers’ Association
18
Resale price maintenance-Standard Oil Co. of Kentucky
20
Misrepresentations--Furniture cases
20
Marking commodities with fictitious and exaggerated retail prices--Clayton F.
Summy Co. case
21
Commercial bribery
21
Misrepresentation of coal-Franklin Coal Co
21
Misbranding of penknives-The Long-Koch Co
22
Beacon Knitting Mills (Inc.)
23
Dismissal of complaints
23
Court cases
United States Supreme Court
Claire Furnace Co
The Swift case
Western Meat Co
Thatcher Manufacturing Co
Eastman Kodak Co
Pacific States Paper Trade Association

24
25
25
25
26
27
29
30

III

IV

CONTENTS

Legal divisions--Continued.
Chief counsel-Continued.
Court cases--Continued.
United States Supreme Court--Continued.
American Tobacco Co
Shade Shop case
Proctor & Gamble Co
United States Circuit Courts of Appeals
Utah-Idaho Sugar Co
Minneapolis Chamber of Commerce
Pure Silk Hosiery Mills
John C. Winston Co
Chicago Portrait Co
Toledo Pipe Threading Machine Co
Q. R. S. Music Co
Armour case
Hills Bros
Chase & Sanborn
Louis Leavitt
Advance Paint Co
Ostermoor & Co. (Inc.) et al
Ajax Rope Co. (Inc.)
Standard Education Society
Franklin Coal Co
Harriet Hubbard Ayer (Inc.)
Cream of Wheat Co
Courts of District of Columbia
Mannered Coal Co
Millers’ National Federation
Division of trade practice conferences
Outline of procedure
Summary of work, 1926
Methods of competition condemned
Economic division
National wealth and income
Grain trade
Electric power
Bread, flour, and grain
Grain marketing
Flour milling
Bread
Open price association
Lumber trade associations
Petroleum prices
Cooperation with the legal staff
Cooperation with other branches of the Government
Export trade division
Export trade act
Provisions of the law
Associations filing papers during the year
Exports during 1925
Section 6 (h) of the Federal Trade Commission act
Trade legislation in foreign countries during the past year

Page
31
32
32
33
33
34
36
37
37
38
39
39
40
40
41
41
42
42
42
43
43
44
45
45
45
47
47
50
50
55
56
59
60
61
61
62
63
63
63
64
64
64
65
65
65
65
66
68
68

CONTENTS

V

Export trade division--Continued.
Page
Foreign trade complaints
70
The liaison committee
72
Administrative division
73
Personnel
73
Publications
74
Docket
74
Library
74
Quarters
75
Fiscal affairs
75
Appropriations, expenditures, liabilities, and balances
75
Statement of costs for the fiscal year ended June 30, 1926
75
Adjustments
70
Tables summarizing work of legal division and court proceedings, 1915-1926
78
1. Preliminary investigations
78
2. Applications for complaint
78
3. Complaints
79
4. Petitions for review--United States Circuit Courts of Appeals
79
5. Petitions for review--Supreme Court of the United States
79
6. Petitions for enforcement--Lower courts
80
7. Petitions for enforcement--Supreme Court of the United States
80
8. Petitions for rehearing, modification, etc.--Lower courts
80
9. Petitions for rehearing, modification, etc.--Supreme Court of the United States81
10. Mandamus, injunction, etc.--Lower courts
81
11. Mandamus, Injunction, etc.--Supreme Court of the United States
81
EXHIBITS
1.
2.
3.
4.
5.
6.

7.
8.
9.

Statement of procedure and policies of the commission
85
Federal Trade Commission act
86
Provisions of the Clayton Act which concern the Federal Trade Commission 92
Export trade act
96
Rules of practice before the Federal Trade Commission
98
Proceedings disposed of July 1, 1925, to June 30, 1926
102
Orders to cease and desist
102
Orders of dismissal
111
Complaints pending July 1, 1926, and status
127
Stipulations published after deleting name of respondents
154
Statements of trade practice conferences
166

ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION
FOR THE FISCAL YEAR ENDED JUNE 30, 1926
INTRODUCTION
To the Senate and House of Representatives:
Pursuant to statute the Federal Trade Commission herewith submits to the Congress
its annual report for the fiscal year July 1, 1925, to June 30, 1926. The commission
was Created by an act of Congress approved September 26, 1914, and was organized
March 16, 1915. The present is the twelfth annual report.
On June 30, 1926, the commission consisted of John F. Nugent, of Idaho, chairman;
Charles W. Hunt, of Iowa, vice chairman; Huston Thompson, of Colorado; William
E Humphrey, of Washington; and Vernon W. Van Fleet, of Indiana.
Mr. Van Fleet tendered his resignation July 31, 1926, and was succeeded by Mr.
Abram F. Myers, of Iowa, who was given a recess appointment by the President, and
took oath of office thereunder on August 2, 1926.
Gratifying progress was made during the last fiscal year in discharging the duties
confided to the commission. By pursuing a consistent policy the commission is
gradually working out a high code of business ethics for the protection of the public
and the guidance of industry. The value of this work is coming more and more to be
appreciated, as is attested by the increasing degree of cooperation on the part of
industry in carrying out the principles of fair competition and sound practice fostered
by the commission. This cooperation is particularly manifested in the trade practice
conferences.
The powers of the commission in obtaining information in connection with
investigations prosecuted under section 6 of the Federal Trade Commission act are
involved in several pending cases. Failure to obtain an authoritative ruling as to the
commission’s powers in this particular has somewhat hampered the work under certain
resolutions of Congress, although excellent progress has been made as shown by the
report of the economic division.
After the close of the fiscal year and before the submission of this report the
Supreme Court handed down its decisions in the cases of

1

2

ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

Federal Trade Commission v. Western Meat Co., No.96; Thatcher Mfg. Co. v. Federal
Trade Commission, No.213; and Swift & Co. v. Federal Trade Commission, No.231,
under section 7 of the Clayton Act. The propositions laid down in these decisions may
be summarized as follows:
(1) That if there has been an acquisition by one competitor of the stock of another,
and the commission files a complaint under section ‘7 of the Clayton Act, and the
holding company thereafter causes the assets of the controlled company to be
transferred to it, the commission may issue an order requiring divestiture of both the
stock and the assets.
(2) That if there has been an acquisition by one competitor of the stock of another,
and the holding company causes the assets of the controlled company to be transferred
to it, and the commission thereafter files a complaint, the commission exceeds its
power if it attempts to order a divestiture of the assets.
The commission has been hampered in its work by being quartered in one of the
temporary war-time buildings, subject to extremes of heat and cold. Since June 1,
1925, 39 ½ working hours have been lost by necessary suspension of work on account
of extremely high or low temperature. The average number of employees on duty
being 225, it results that practically 1,270 working days, or the equivalent of the full
working time of four employees for a year, was lost to the Government during that
period.
The commission here reports in detail concerning its administration of the Federal
Trade Commission act, approved September 26, 1914 (38 Stat. 717); delegated
sections of the Clayton Act, approved October 15, 1914 (88 Stat. 730); and the export
trade act, approved April 10, 1918 (48 Stat. 516). The administration of these acts by
the commission falls under four major subjects, i.e., legal, economic, export trade, and
administration, and the work of the year is reported under these captions in the order
given.

REPORT BY DIVISIONS OF WORK
LEGAL DIVISIONS
Under this caption is reported the work relating to the prevention of unfair methods
of competition prohibited by section 5 of the Federal Trade Commission act; and cases
of price discrimination, tying contracts, corporate-stock acquisitions, and interlocking
directorates, arising under sections 2, 3, 7, and 8, respectively, of the Clayton Act.
The various phases of the legal work are apportioned among five separate,
independent divisions, each of which is responsible only to the commission. These are:
Chief counsel’s division, legal investigating division, board of review, trial examiners’
division, and division of trade practice conferences.
STATISTICS AND PROCEDURE ON LEGAL WORK

The character and volume of the legal work performed can best be reflected in this
report by the use of statistical tables supplemented by comment on representative
cases. Therefore, tables have been prepared summarizing the work of the legal
divisions and court proceedings for the current fiscal year, and also for the period
covered by the life of the commission from its organization March 16, 1915, down to
and including June 30, 1926. These tables are on pages 78 to 81.
Details of the procedure upon legal matters are set out in the following pages, being
arranged in natural sequence from the initiation of a case to its final determination by
the commission and review by the courts. This has been done under headings: (a)
Legal investigating division, (b) board of review, (c) trial examiner, (d) chief counsel,
(e) court cases, and (f) trade-practice conferences. In addition, a list has been prepared
of the methods of competition heretofore condemned by the commission. This list is
on page 50.
LEGAL INVESTIGATING DIVISION
OUTLINE OF PROCEDURE

The work of the chief examiner’s division is divided into two classes: (1) Special
legal investigations by direction of the President, the commission, or by Congress, and
(2) investigations preliminary to the possible issuance of complaints of law violations.
15173---26-----2

3

4

ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

The former are handled under the personal supervision of the chief examiner, the
results being compiled and forwarded to the commission for its information or
transmittal to Congress or the President.
Investigations preliminary to the possible issuance of complaints originate in several
ways, i.e., by the direction of the commission, by information developed in other
investigations, and in the great majority of eases by direct application to the
commission at its headquarters or branch offices.
In filing a complaint with the commission no formalities are required. A letter
suffices if it is signed by the complaining party and contains the name and address of
the party complained against, together with a statement of the nature of relief sought.
It should also transmit all the evidence in the possession of the complaining party.
Upon receipt by the chief examiner all matters are examined for necessary
jurisdictional elements, such as public interest, unfair competition, interstate
commerce, etc. Whenever necessary this examination is supplemented by
correspondence or interviews. If the material is first presented at a branch office, the
attorney in charge conducts the preliminary investigation, together with any necessary
correspondence or interviews, and forwards the result of his work to the chief
examiner, who passes upon it in the same manner as material originating at
headquarters.
If the material examined is not within the jurisdiction of the com mission or is
without merit, or if the matter is satisfactorily disposed of by conference or
correspondence, the file is closed as an “Undocketed application.” If the matter is
within the commission’s jurisdiction, is well founded, and can not be satisfactorily
disposed of by informal consultation or correspondence, it is docketed as an
“Application for the issuance of complaint.”
Each docketed application is assigned by the chief examiner to an examining
attorney, whose duty it is to gather all facts. Without identifying the applicant, the
party complained against is presented with a complete statement of the matter and
requested to submit such statements, evidence, documents, etc., in defense or
explanation of his position, as he may desire brought to the attention of the commission. The examining attorney makes such other investigation as may be necessary
for full development of all facts, and thereafter summarizes his work in a final report
which is submitted, with the record, to the chief examiner.
The chief examiner passes upon the examining attorney’s report and indicates his
approval or disapproval. If the examining attorney and chief examiner agree in their
opinion that the application should be dismissed, the case passes to the full
commission for its im-

LEGAL DIVISION

5

mediate consideration. If the chief examiner believes that the matter can be settled by
stipulation, the case passes to the chief trial examiner for negotiation. If the examining
attorney and the chief examiner differ in their opinion that the complaint should issue,
the case passes to the board of review for its consideration.
The chief examiner also conducts, by direction of the commission or upon requests
of other units, supplemental investigation of applications for complaints, of docketed
complaints, or suspected violations of the commission’s orders to cease and desist.
SUMMARY OF WORK, 1926

In addition to the work of the chief examiner’s office reflected by Tables 1 and 2,
on page 78, an investigation of the activities of the American Tobacco Co. and the
Imperial Tobacco Co. (Ltd.) was made pursuant to Senate Resolution 329 (68th Cong.,
2d sess.). The inquiry covered (1) the present degree of concentration and relationship
between the two companies involved, and (2) the methods employed by these
companies with respect to cooperative marketing associations. A report including the
facts disclosed by the inquiry was made to the President, December 23, 1925, and
published, the report having been delayed because of supplemental investigations
requested by the cooperative associations.
During the year the chief examiner commenced and made some progress on the work
under Senate Resolution 34 (69th Cong., special sess.), which directs the Federal
Trade Commission to make an inquiry (d) into the growth and importance of
cooperative associations, including particularly the costs of marketing and distribution
of such cooperatives as compared with corresponding costs of other types of
distributors; (b) into the extent and importance of the interferences with and
obstructions to the formation and operation of cooperative organizations of producers,
distributers, and consumers by any corporation or trade association in alleged violation
of the antitrust laws; and (c) to report thereon, with recommendations for legislation,
if necessary.
A preliminary study of the problem was made, many facts and figures collected, and
a questionnaire calling for information chiefly of a statistical nature sent out. Near the
end of the year a few men were sent into the field to interview officers of the larger
associations, and preparations made for the collection of the special information called
for by the resolution on a comprehensive scale.
The chief examiner’s office has been greatly hampered by a lack of funds sufficient
to carry on this work with the vigor that it deserved. Everything possible has been done
to press the work with the small sum left after taking care of the regular assignments,
but this has been insufficient and it is being unavoidably delayed.

6

ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

BOARD OF REVIEW
OUTLINE OF PROCEDURE

The board of review is an organization consisting of five lawyers, established within
the commission for the purpose of review, both as to the law and facts, before
submission to the commission, the entire record of applications for the issuance of
complaints investigated by the chief examiner’s office wherein recommendation for
the issuance of complaint. has been made by either the examining attorney or the chief
examiner.
The statements of all witnesses interviewed by the commission’s investigators and
all documentary evidence and exhibits secured are carefully considered by the board,
and, when necessary, the board may require that further information be secured.
If the board believes that complaint should issue, before finally making that
recommendation it is its duty to accord to the proposed respondent or respondents the
privilege of appearing before the board at an informal hearing for the purpose of
submitting any facts or considerations with a view to avoiding issuance of complaint.
Before Such hearings are held the board causes a formal notice of time and place of
hearing to be served upon the respondents with a brief statement of the nature of the
charges. At such hearing the proposed respondents may appear in person or by counsel
and may submit any statement in writing or documentary evidence, all of which is
carefully considered. by the members of the board before determining its final
recommendation.
After reaching its decision the board prepares its report to the commission,
consisting of (1) a detailed summary of all facts developed, (2) a full opinion based
upon the facts and the law, and (3) the board’s recommendation.
Applications in which the board recommends complaint or dismissal are forwarded
to individual commissioners in rotation. After study by the commissioner, the case,
with his memorandum embodying his recommendation, is presented by him to the full
commission for its consideration.
If the board, notwithstanding previous recommendations, or as the result of its
further inquiry or hearings, believes that the matter can be settled by stipulation, it
forwards the files, with its report and recommendations, to the chief trial examiner for
negotiation of stipulation.
SUMMARY OF WORK, 1926

The work of the board of review upon applications for complaint is, of course,
included in the statistical tables presented on page 78. During the current year the
board was called upon to

LEGAL DIVISION

7

handle 255 applications for complaints, of which 200 were forwarded during the year
and 55 pending at its end. In connection with these applications, 81 informal hearings
were held.
TRIAL EXAMINERS’ DIVISION
OUTLINE OF PROCEDURE

The trial examiners division functions under the direct supervision of the
commission. Its work is divided into two classes, i.e., (1) settlement of applications for
complaint by stipulation, and (2) presiding at the trial of complaints issued. This
division was established December 1, 1925, primarily to afford an agency to
administer the commission’s new procedure and policies providing for the settlement
of cases by stipulation, except where the public interest demanded otherwise, and
providing also that prospective respondents should have a hearing prior to the issue of
complaint.
During the short period since the stipulation rule has been in effect and by which
rule respondents are permitted to stipulate facts and voluntarily agree to abandon
unfair methods of competition, except in cases where the practices are fraudulent or
so vicious that the protection of the public demands the legal procedure upon
complaint and order, a total of 106 applications for complaints was disposed of by
stipulation. These cases involved 109 separate respondents, each of which entered into
a stipulation of the facts with an agreement to abandon the unfair methods of
competition and cease and desist forever from the said practices in interstate
commerce.
The stipulation rule, as contrasted to the complaint procedure, has resulted in a
substantial saving in time and money to the Government and also to the prospective
respondents, and at the same time has eliminated unfair methods and practices from
the channels of interstate trade. From an estimate made by the commission it was
determined that the average case disposed of by complaint procedure, including the
taking of testimony, reporting, and trial, costs about $2,500, while the cost of settling
an application for complaint by stipulation, thus avoiding a complaint, costs less than
$500 per case. The proportion of saving of time is even greater and more important
than the saving in money.
The stipulation rule, in the opinion of the commission, will result in gradually
establishing precedents that will greatly facilitate its procedure. To aid in the
establishment of precedents, and for the guidance of the business world and for the
information of the public generally, statements of facts covering stipulated cases,
including the practices abandoned, have been published from time to time, but without
identifying parties to the stipulation.

8

ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

The second important duty of the trial examiners’ division is indicated by its name,
i.e., the duty of presiding at the trial of all formal cases, hear motions of counsel, and
rule upon the admissibility of testimony and evidence; adjourn hearing from time to
time and when completed close the case; make up the record and prepare reports upon
facts for the information of the commission and service upon respective counsel. The
report upon the facts with exceptions thereto taken by counsel for the commission and
counsel for the respondent is the basis of argument before the commission after final
hearing of complaint cases on the merits.
SUMMARY OF WORK, 1926

The work of the trial examiners’ division, like that of the other branches of the legal
division, is reflected in the statistical tables on page 78. Copies of stipulations
published to date are reproduced on page 154.
CHIEF COUNSEL
OUTLINE OF PROCEDURE

The chief counsel is the legal advisor to the commission and is charged with the
prosecution of cases before the commission and in the courts. He also supervises the
preparation of all complaints and other processes directed by the commission.
It is only after the most careful scrutiny of the record that the commission issues a
complaint. The commission must have, in the language of the statute, a reason to
believe that the law has been violated and that the public interest is involved before
complaint issues. The complaint is the specified statutory means provided to bring
before the commission a party charged with violation of laws within its jurisdiction.
Unlike the preliminary inquiries and applications for complaint, which are held strictly
confidential, the complaint and answer is a public record, and with the issuance of a
complaint there is set up the formal docket, which is open for public inspection after
answer of the respondent is filed or time for filing has expired.
A complaint is issued in the name of the commission in the public interest. It names
a respondent and charges a violation of law, with a statement of the charges. It
contains notice of a hearing. Thirty days are allowed the respondent within which to
make answer. The party first complaining to the commission is not a party to the complaint when issued by the commission; nor does the complaint seek to adjust matters
between parties. It is to prevent unfair methods of competition for the protection of the
public.
Upon the issuance of a complaint the chief counsel is charged with the trial and the
submission of the matter to the commission there-

LEGAL DIVISION

9

after. After answer is filed, and upon due notice to all parties respondent, the case is
set down for the taking of testimony before a trial examiner. After the taking of
testimony and the submission of evidence on behalf of the commission in support of
its complaint, and on behalf of the respondent, the trial examiner prepares a report of
the facts for the information of the commission, counsel for the commission, and
counsel for the respondent. Exceptions to the trial examiner’s report may be made by
either counsel for the commission or counsel for the respondent. The next step is the
filing of briefs, and thereafter the case comes on for final argument before the full
commission upon the complaint, the answer, the testimony and exhibits, the trial
examiner’s report, exceptions thereto, and briefs by opposing counsel. The case is
heard and taken under advisement, and thereafter the commission reaches a decision
either sustaining the charges in the complaint or dismissing the complaint. If the
complaint be sustained, an order is issued requiring the respondent to cease and desist
from the practices proven under the complaint. If the complaint be dismissed, an order
of dismissal is issued.
In noncontested cases an admission of the matters alleged in the complaint may be
made by respondent and a stipulation in lieu of testimony entered into between the
commission and the respondent, upon which the commission makes its findings of
facts, which are the basis of an order to cease and desist. The stipulation, of course,
obviates the necessity for the taking of testimony and the briefing and argument of the
case unless the respondent desires to be heard. Stipulations in connection with
complaints are negotiated by the chief counsel.
By the commission’s rules respondents against whom orders to cease and desist have
been directed are required within a specified time, usually 60 days, to report in writing
the manner in which they are complying with the provisions of the commission’s
order. When the commission shall have found that its order is not being observed it
may apply to the United States Circuit Court of Appeals for enforcement of its order.
Respondents may likewise apply to the United States Circuit Court of Appeals for
review of the commission’s orders, and these proceedings may, of course, be carried
by either party to the Supreme Court of the United States for final determination.
All court proceedings are supervised by the chief counsel through the assistant chief
counsel in charge of appellate work.
SUMMARY OF WORK, 1926

The volume of work of the legal division is concisely expressed in the statistical
tables to be found on pages 78 to 81 of this report.

10

ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

Complete synopses of complaints disposed of by dismissal or orders to cease and
desist entered during the year and all complaints pending at its close will be found in
Exhibits 6 and 7, pages 102 to 153.
CHARACTER OF COMPLAINTS

In the course of the performance of its duties the commission is called upon to
protect the public against the business excesses of producers, manufacturers, and
middlemen, and to shield honest business concerns from the destructive force of unfair
competition and monopolistic tendencies.
All but 1 of the 62 complaints issued during the year charged unfair methods of
competition. Violation of section 7 of the Clayton Act by acquisition of stock of
competing concerns was charged in only one complaint, namely, the Continental
Baking Corporation complaint. There was also only one complaint charging violation
of section 2 of the Clayton Act, which complaint is the one filed against the Aluminum
Co. of America. This complaint also included a charge of violation of section 5 of the
Federal Trade Commission act. No complaints charging violation of section 3 (tying
contracts) or section 8 (interlocking directorates) of the Clayton Act were issued
during the fiscal year here reported on.
Herewith are presented brief summaries of the charges contained in a few of the
complaints issued by the commission during the past fiscal year. These complaints are
fairly representative cases.
Attention is especially invited to the fact that all Of these complaints, except the
Continental Baking Corporation complaint, are pending, and consequently the
commission has reached no determination as to whether or not the law has been
violated. The allegations of the complaints set forth the corn-mission’s reason to
believe that the law has been violated. As provided by law, the respondents have
opportunity to make answer and introduce evidence in denial of the allegations. In
most of the cases the respondents have filed their answers denying the allegations
of the complaints. The cases will be determined only after evidence has been taken
and hearing before the commission.
Aluminum Co. of America (sec. 2 of Clayton Act and sec. 5 of the Federal Trade
Commission act).--In charging violations of section 2 of the Clayton Act and section
5 of the Federal Trade Commission act, the complaint in this case sets forth that the
Aluminum Co. owned or controlled extensive bauxite deposits from which aluminum
ore is produced in this country and in foreign countries; various refining and reduction
works and fabricating plants and rolling mills in Arkansas, Illinois, New York,
Tennessee, North Carolina, Penn-

LEGAL DIVISION

11

sylvania, and New Jersey, and that the respondent is the sole producer of virgin
aluminum ingots in the United States, and that it produces 95 per cent of the virgin
sheet aluminum in this country; also that respondent and the Aluminum Goods
Manufacturing Co., of whose stock respondent owns 36 per cent, are the principal producers of aluminum cooking utensils in the United States ; that respondent owns or has
a large interest in other companies fabricating aluminum, and that it owns 50 per cent
of the stock of the Norsk Aluminum Co. of Norway, one-third of the stock of the
Norsk-Nitrid Co. of Norway, and is the sole owner of the Northern Aluminum Co.
(Ltd.) of Canada, the only other manufacturer of virgin aluminum ingots in the
Western Hemisphere.
The respondent is charged with entering into contracts, agreements, conditions, and
understandings to substantially lessen competition and tend to create a monopoly by
selling virgin sheet aluminum at a lesser price to manufacturing foundries than to
jobbing foundries, and, further, by discriminating in the price of aluminum sold to
certain manufacturers of automobile bodies, cooking utensils, or other fabricated
aluminum products.
The complaint also charges the company with employing a scheme the effect of
which is to gain a monopoly of the aluminum sand-castings industry of the United
States by (a) arbitrarily fixing price differentials between virgin aluminum ingots and
scrap aluminum (b) by paying for scrap aluminum more than it costs to manufacture
virgin aluminum ingots; (c) by making concessions to automobile-body manufacturers
and other fabricators in order to obtain monopoly of scrap aluminum; (d) by selling
below cost to its subsidence and discriminating against competitors of such
subsidiaries; (e) by selling aluminum sand castings below cost to drive out
competitors; all with the purpose and effect of eliminating the source of supply of
independent or competing concerns, and to suppress corn-petition and create a
monopoly.
The complaint also charges the company with employing a scheme the purpose and
effect of which is to gain and maintain a monopoly of aluminum raw material and
aluminum products by arbitrarily refusing to supply aluminum sheet metal or ingots
to manufacturers who are in competition with its subsidiaries, or by delivering insufficient quantities or inferior quality of aluminum to competitors, the effect of which
is to unfairly suppress competition, tending to create or maintain a monopoly.
Answer to the above complaint was filed by the Aluminum Co. on September 23,
1925. In addition to denying specifically various charges of said complaint and in
setting forth various averments in opposition to said charges, the company further
states in its answer

12

ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

that it “denies that any or all of the averments set forth in the complaint disclose any
violation of law or that the Same, if true, would justify the making and issuing of any
decree by the commission against the respondent. * * *”
Considerable testimony bearing upon issues formed by the complaint and answer has
been taken, and at the close of the fiscal year the further taking of testimony was
postponed for several months in order that respondent might have an opportunity to
produce certain information called for by the commission.
Continental Baking Corporation (sec. 7 of the Clayton Act).--On April 10, 1925, the
commission filed a complaint against the Continental Baking Corporation charging it
with acquiring, owning, and holding the stock or other share capital of 14 corporations
severally engaged in the manufacture and sale in commerce of bread and other food
products, in violation of section 7 of the Clayton Act. Subsequent to the filing of this
complaint it became known to the commission that the Continental Baking
Corporation had acquired the stock or other share capital of nine or more additional
corporations; and it appearing to the commission that the subsequent acquisitions of
stock should be included in its complaint, the commission, on December 19, 1925,
dismissed its complaint against the Continental Baking Corporation without prejudice,
and on the same day issued a new complaint against said corporation including the
acquisitions of the stock of additional corporations. On the 8th day of February, 1926,
the United States filed a petition in equity, No.1073, in the District Court of the United
States for the District of Maryland, charging defendants Ward Food Products
Corporation, the Ward Baking Corporation, Ward Baking Co., the General Baking
Corporation, the General Baking Co., the Continental Baking Corporation, United
Bakeries Corporation, William B. Ward, Howard B. Ward, William Deininger, Paul
H. Helms, J. W. Rumbough, R. E Peterson, George G. Barber, and George B. Smith
with violation of the act of Congress of July 2, 1890, entitled “An act to protect trade
and commerce against unlawful restraints and monopolies,” known as the Sherman
Antitrust Act; and a violation of section 7 of the Clayton Act. On April 3, 1926, upon
the petition of the United States for an injunction and for other relief, and upon consent of the defendants, the court entered a decree. The decree completely dissolved the
Ward Food Products Corporation and called for a surrender of its charter to the State
of Maryland. The individual defendants and the corporate defendants are, among
‘other things, perpetually restrained and enjoined from directly or indirectly doing any
act or thing in furtherance of any plan for bringing the several corporate defendants
under common control and from forming or joining any plan for restraining or
monopolizing inter-

LEGAL DIVISION

13

state trade or commerce in the bread industry. The Continental Baking Corporation
and the United Bakeries Corporation are perpetually enjoined, restrained, and
prohibited from acquiring directly or indirectly, receiving or holding, voting or in any
manner acting as the owner of, or exercising direct or indirect control of, the whole or
any part of the shares of capital stock of the defendants, the Ward Baking Corporation,
the Ward Baking Co., the General Baking Corporation, the General Baking Co., or any
of their controlled companies, and from acquiring any of their physical assets. All of
the corporate defendants are perpetually enjoined, restrained, and prohibited from
acquiring directly or indirectly the whole or any part of the stock or other share capital
of any other baking corporation engaged also in interstate commerce, where the effect
of such acquisition may be to substantially lessen competition in such commerce
between the corporation whose stock is so acquired and the defendant corporations,
or tend to create a monopoly. On April 7, 1926, the commission dismissed its
complaint against the Continental Baking Corporation.
Resale price maintenance (see. 5 of Federal Trade Commission act).--A typical
complaint on resale price maintenance is the one issued by the commission on
November 13, 1925, against the Gotham Silk Hosiery Co. (Inc.). This company is a
$4,000,000 concern engaged in manufacturing men’s and women’s silk hosiery and
selling same to approximately 3,000 retail merchants throughout the United States.
In addition to these allegations, the complaint charges the company with adopting
and enforcing a merchandising system of establishing and maintaining certain
specified uniform prices at which its hosiery shall be resold to the purchasing public
by the retailer, with the effect of substantially lessening and suppressing competition,
and preventing dealers from selling at less than the fixed price, thus depriving
purchasers of advantages in price resulting from the natural and unobstructed flow of
competition.
In carrying out such merchandising system and preventing the dealers from selling
below the resale price fixed by the company, it is alleged that the respondent employs
such means as refusing to sell to price cutters and using cooperative methods to
enforce its system of uniform resale prices by, among other things, securing reports of
price-cutting dealers from their competitors, investigating reports of price cutting, and
using coercion to force price cutters to adhere to respondent’s uniform prices.
Answer to this complaint was filed on December 12, 1925, under the name of the
Gotham Industrial Corporation, to which name, it is averred, the Gotham Silk Hosiery
Co. (Inc.) was changed on the day before the complaint was issued. It is admitted in
the

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

answer that the respondent for two years up to the reorganization hereinafter referred
to had adopted and endeavored to maintain a scheme of resale price maintenance, but
respondent denies that in the maintenance of such resale prices it used the methods
charged in the complaint as being unlawful. With respect to reorganization, the answer
sets forth that on November 10, three days before the complaint was issued, the
respondent, Gotham Silk Hosiery Co. (Inc.), a New York corporation, transferred its
business, patents, trade-marks, and good will, including the right to exclusive use of
the name Gotham Silk Hosiery Co. (Inc.), to the Gotham Silk Hosiery Co. (Inc.), a
Delaware corporation. At the close of the fiscal year the case was pending on
complaint and answer.
False claim of being “Manufacturer” or “Mills.”--Several complaints were issued
during the fiscal year against various concerns who deal in knitted or woven clothing
or fabric charging them with the use of unfair methods of competition, in violation of
section 5 of the Federal Trade Commission act, in that they falsely represent and hold
themselves out to the public as being manufacturers of, or owners and operators of
mills producing, their merchandise, and as selling at factory prices direct to consumers
or other purchasers, thereby tending to mislead and deceive the public into erroneously
believing that the purchaser from such concerns is buying direct from the
manufacturer, and thereby saving and eliminating the charges and profits of
middlemen. Among the methods employed in making such misrepresentations is the
use of such words as “Mills” and “Manufacturer” in their trade or corporate name and
in their advertising matter.
Misbranding of fur.--The commission issued a number of complaints against dyers
and dealers of furs located in Boston, New York, Newark, Chicago, and Los Angeles,
charging such concerns with using unfair methods of competition in violation of
section 5 of the Federal Trade Commission act, by falsely branding and misrepresenting furs through the use of such terms as the following: “Golden Seal,”
“Genuine Northern Seal,” “Northern Bevre,” “Northern Nutriette,” “Northern Seal,”
“Iceland Seal,” “Iceland Beaver,” “Superior Seal,” “Baltic Seal,” “Baltic Beaver,” and
“Bay Seal” for dyed rabbit fur; “Hollander Seal” for dyed muskrat; “Manchurian
Lynx” for inferior fur not of the lynx; “Manchurian Wolf” for inferior fur not of the
wolf.
Wholesale Grocers’ Association of New Orleans.--The complaint in this case was
issued against the Wholesale Grocers’ Association of New Orleans, its officers and
members, and 28 specifically named respondents engaged in the wholesale grocery
business. They are charged in the complaint with having cooperated and confederated
together to confine the distribution of groceries and allied products

LEGAL DIVISION

15

throughout their territory through the channel from manufacturer to wholesaler to
retailer to consumer, and to prevent dealers from obtaining groceries and allied
products direct from the manufacturer to producer, thereby suppressing competition,
hindering and obstructing the natural flow thereof in the sale and distribution of
groceries and allied products, all in violation of section 5 of the Federal Trade
Commission act.
Among the acts recited in the complaint as being used by respondents to carry into
effect the alleged unlawful combination are the following: (a) Agreeing to and making
threats of boycott and boycotting, intimidating, and coercing manufacturers and
producers to refrain from selling direct to retailers or consumers; (b) by inducing and
compelling manufacturers to cease dealing with dealers who are offensive to
respondents; (c) by practicing a system of espionage against competing dealers--all
with the effect of hindering and suppressing competition by forcing retailers to buy
through wholesale channels instead of direct from manufacturers.
The respondents filed their answer to this complaint on October 21, 1925, in which
the charges of violation of law set forth in the complaint are generally and specifically
denied. At the close of the fiscal year the matter was awaiting further proceeding on
complaint and answer.
Fictitious prices--Eclipse Fountain Pen & Pencil Co. et al.--These respondents are
engaged in the manufacture and sale of fountain pens and pencils, and they are charged
in the complaint with using unfair methods of competition in violation of section 5 of
the Federal Trade Commission act by labeling and marking their products with
fictitious and exaggerated retail prices, thereby misleading and deceiving the
consuming public as to the value of their pens and pencils.
Answer was filed by the respondents on April 17, 1926, denying that the prices
marked on their products are fictitious or exaggerated or that they are misleading and
deceptive. The testimony has been taken, and at the close of the fiscal year the case
was pending the filing of the trial examiner’s report upon the facts and final hearing
before the commission.
Furniture cases--Misbranding and misrepresentation.--During the fiscal year
reported on the commission issued a number of complaints against certain furniture
dealers of New York City and Lancaster, Pa., in which respondents were charged with
using unfair methods of competition in violation of section 5 of the Federal Trade
Commission act in that they falsely advertised, described, and sold (a) as “Mahogany,”
“Combination mahogany,” “Genuine mahogany,” “Finished in mahogany” furniture
which consisted in whole or in part of woods other than mahogany; (b) as
“Combination Golden Oak” furniture which was composed wholly of woods other

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

than oak; (c) as “Combination walnut,” “Two-toned walnut” furniture made in whole
or in part of woods other than walnut; (d) as “French walnut finish,” “French walnut
combination” furniture composed wholly of wood other than walnut grown in France.
ORDERS TO CEASE AND DESIST

The final expression of the commission in a case is an order upon the respondent to
cease and desist a particular practice or practices charged in the complaint. As shown
by the following table, the commission, during the year here reported upon, issued 44
separate orders to cease and desist. All of the 44 orders covered violations of section
5 of the Federal Trade Commission act relating to unfair methods of competition,
except one, namely, the order entered against the International Shoe Co., in which
violation of section 7 of the Clayton Act (corporate stock acquisitions) was enjoined.
As in past years, the respondents upon whom the orders were issued have in a great
many cases accepted the orders and filed reports with the commission signifying their
compliance with the terms of the orders.
Orders to cease and desist were issued during the year as follows:
Respondent
American Specialty Co. et al
Arkansas Wholesale Grocers’ Association et al
Ayer (Inc.). Harriet Hubbard
Baltimore Paint & Color Works (lnc.)
Bardwil Bros
Beacon Knitting Mills
Brooks Oil Co. et al
California Retail Fuel Dealers’ Association et al
Calumet Baking Powder Co
Chero-Cola Co
Cohn-Hall-Marx Co
Cooke et al., B.W.
Dubiner & Sommerfeld
Edison Fixture Co. (Inc.)
Factory-To-You Furniture Store
Federal M ail Order Co
Franklin Coal Co
Furniture Manufacturers’ Show Rooms (Inc.)
Good Grape Co
Grand Rapids Furniture Manufacturing Association
(Inc.) et al.
Hagen Import Co. of Pennsylvania
Hanes Knitting Co. P.H.
Houbigant (Inc.)
International Shoe Co
Kohl Co., J.
Lauer & Suter Co
Lexington Storage Warehouse Co. et al
Long-Koch Co
Minneapolis Woolen Mills Co. (Inc.)
Missouri State Retail Coal Merchants’ Association et al
National Furniture Distributing Corporation
North Dakota Wholesale Grocers’ Association et al
Ohio Shellac Co
Ostermoor & Co. et al
Reinhart & Newton Co
Rosenbush & Solomon Co
Shapiro & Sons

Location
Lancaster, Pa
Little Rock, Ark
New York, N.Y.
Baltimore, Md
New York, N.Y.
do
Cleveland, Ohio
Oakland, Calif
Chicago, Ill
Columbus, Ga
New York, N.Y.
Chicago, Ill
New York, N.Y.
do
Philadelphia, Pa
Chicago, Ill
St. Louis, Mo
Philadelphia, Pa
Chattanooga, Tenn
New York, N. Y

Product
Seeds.
Groceries.
Toilet preparations.
Paints.
Lace.
Knit goods.
Paints.
Coal.
Baking powder.
Beverages.
Cotton goods.
Drafting and mechanical schools.
Cigars.
Electrical appliances.
Furniture.
Clothing.
Coal.
Furniture.
Beverages.
Furniture.

Philadelphia, Pa
Winston-Salem, N.C.
New York, N. Y
St. Louis, Mo
Seattle, Wash
Baltimore, Md
New York, N. Y
Newark, N.J.
Minneapolis, Minn
St. Louis, Mo
New York, N. Y
Grand Forks, N.Dak.
Cleveland, Ohio
New York, N. Y
Cincinnati, Ohio.
Chicago, Ill
Baltimore, Md

Malt extract.
Underwear.
Toilet preparations.
Shoes.
Toilet preparations.
Candy.
Furniture.
Knives.
Knit goods.
Coal.
Furniture.
Groceries.
Shellacs and varnishes.
Mattresses.
Candy.
Shellacs and varnishes
Men’s clothing.

Standard Fountain Pen Co
Standard Oil Co. of Kentucky
Stetson Co., John B
Summy Co., Clayton F
U. S. Oil Co. (Inc.) et al
Watson Co., George E
Western Woolen Mills Co
Zorn & Co., S

Los Angeles, Calif
Louisville, Ky
Philadelphia, Pa
Chicago, Ill
Providence. R. I
Chicago, Ill
Minneapolis, Minn
Louisville, Ky

Fountain pens.
Stoves.
Hats.
Sheet music.
Oils.
Paints.
Knit goods.
Oats.

LEGAL DIVISION

17

A number of representative cases have been selected to indicate the nature of the
orders to cease and desist issued during the year. These cases are described below:
Disparagement of competitive product--Calumet Baking Powder Co.--The Calumet
Co., engaged in the sale of baking powder, was charged in the complaint of the
commission with employing the practice of publishing anonymously adverse,
disparaging, and derogatory opinions, statements, and comments as to the
wholesomeness of self-rising flour, the use of which does not require the addition of
baking powder, such statements being not well founded in fact.
In the order to Cease and desist, entered by the commission on February 8, 1926, the
respondent was prohibited from directly or indirectly (1) employing professional or
other writers publicly to disparage the wholesomeness of self-rising flour and
circulating or causing to be circulated such disparaging articles or statements among
the trade and consuming public under the name of the writer or writers so employed,
and withholding or concealing from the trade and consuming public the fact of such
employment; (2) preparing and circulating or causing to be prepared and circulated
among the trade and consuming public articles of anonymous authorship disparaging
the wholesomeness of self-rising flour or the use thereof.
Acquisition of corporate stock in violation of section 7, Clayton Act--International
Shoe Co. case.--This company was charged in the complaint with acquiring
substantially ail of the capital stock of its competitor, W. H. McElwain Co., a large
shoe-manufacturing concern, thereby tending to lessen competition, restrain
commerce, and create a monopoly. The commission entered its order in the matter on
November 25, 1925, requiring the International Shoe Co. to (1) divest itself of all stock
or share capital of W. H. McElwain Co., a corporation, which it may hold, directly or
indirectly, together with all right, title, interest, and claim in and to such stock or share
capital, substantially all the stock or share capital of W. H. McElwain Co. being found
and declared to have been acquired and to have been held, owned, and used by
International Shoe Co. in violation of section 7 of said act of Congress; (2) cease and
desist from the ownership, operation, management, and control of the assets,
properties, rights, and privileges acquired by it from W. H. McElwain Co. subsequent
to the acquisition by it of the stock or share capital of W. H. McElwain Co., together
with all improvements and additions thereto, which assets, properties, rights, and
privileges are found and declared to have been acquired and to be now held by
International Shoe Co. as the result of the acquisition by International Shoe Co. of the
stock or share capital of W. H. McElwain Co. in violation of section 7 of said act of
Congress; (3) divest itself

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

of all assets, properties, rights, and privileges acquired by it from W. H. McElwain Co.
subsequent to the acquisition by it of the stock or share capital of W. H. McElwain
Co., together with all improvements and additions, thereto, which assets, properties,
rights, and privileges are found and declared to have been acquired and to be now held
by International Shoe Co. as the result of the acquisition by International. Shoe Co. of
the stock of share capital of W. H. McElwain Co. in violation of section 7 of said act
of Congress. On March 24, 1926, respondent, International Shoe Co., filed a motion
to suspend operation of the order until the Supreme Court of the United States shall
have announced its decision in the case of the Federal Trade Commission v. Thatcher
Manufacturing Co., decided April 16, 1925, by the Circuit Court of Appeals for the
Third Circuit, review of which writ of certiorari was granted in October, 1925, the
respondent showing that (1) the Thatcher case presented for decision by the Supreme
Court for the first time the construction and meaning of a portion of section 7 of the
Clayton Act relied upon by the commission in the instant case; (2) the Thatcher case,
as respects one of four stock acquisitions there dealt with, involves facts somewhat
similar and in part analogous to the facts shown on this record, so that the decision
there might well be determinative of the issue here. The commission, on consideration
of respondent’s motion, on June 2, 1926, ordered that the enforcement of the
commission’s order be suspended until the matter of Thatcher Manufacturing Co.,
docket 738, Swift & Co., docket 435, and western Meat. Co., docket 456, now pending
in the Supreme Court of the United States, are decided.
Adulteration of grain.--The respondents in this case were Garnett S. Zorn and H.
Boltze, who carried on the business of selling grain under the trade name of S. Zorn
& Co. They were charged in the commission’s complaint with unfair methods of
competition in the misrepresentation and adulteration of oats and were directed by
order of the commission, dated October 31, 1925, to cease and desist from using the
word “oats” in descriptions or designations in connection with the sale of
“screenings,” “wild oats,” or “mill oats”’ artificially mixed with cultivated oats unless
the word “oats” is accompanied by a word or words plainly designating that such is an
artificial mixture of “Screenings,” “wild oats,” or “mill oats” with cultivated oats and
not a natural mixture from the field where the oats were cultivated.
North Dakota Wholesale Grocers Association.--This association and its members,
composed of wholesale grocers, serving the public throughout North Dakota and parts
of Montana, Minnesota, and South Dakota, were named respondents in this case. They
were,

LEGAL DIVISION

19

charged with, and in the order of the commission entered July 20, 1925, were required
to cease and desist from conspiring, confederating, or cooperating among themselves
or with others, in the following practices: (1) Adopting and maintaining or
endeavoring to adopt and maintain uniform selling prices on grocery products sold by
respondent members; (2) arranging or attending meetings of competing jobbers or
circulating information among competing jobbers for the purpose of causing them to
adopt or adhere to uniform selling prices in their competition with each other; (3)
agreeing among themselves or with other competing jobbers to maintain
manufacturers’ list prices as the jobbers’ resale prices and to make no indirect concessions therefrom, such as prepayment of freight or giving the buyer the benefit of the
saving in handling costs on shipments made direct from the manufacturers ; (4)
inducing and procuring competing jobbers to adopt and adhere to the manufacturers’
list prices as the jobbers’ selling prices on various commodities, inducing
manufacturers to increase their list prices and discounts to the jobber for the purpose
of increasing the jobbers’ gross margins and selling prices and making them uniform,
and reporting or threatening to report to manufacturers such jobbers as failed or
refused to adopt the manufacturers’ list prices and adhere to them as their selling
prices in competition with respondent members ; (5) preventing or attempting to
prevent competitors who undersell respondent members from securing goods from
manufacturers on equal terms with respondent members through concerted objections
lodged with manufacturers and through concerted refusals or threatened refusals to buy
from manufacturers if they sell such competitors of respondent members ; (6)
recommending or procuring the circulation of scurrilous and defamatory attacks on
competitors who undersell respondent members among the customers or prospective
customers of such competitors; (7) circulating among respondent members favorable
comment concerning such manufacturers as refuse to sell certain competitors of
respondent members and urging respondent members to give increased support and
cooperation to such manufacturers; (8) reporting to officers of respondent association
the names of manufacturers who have sold direct to retailers for the purpose of
enabling the officers to use the power and influence of respondent association to
induce such manufacturers to remain completely loyal to respondent jobbers as their
exclusive channel of distribution in respondent’s territory, and by reporting to
respondent members the failure of such efforts with suggestions that the members
refuse to handle the goods of such manufacturers ; (9) concerted withdrawal or seeking
pledges of concerted withdrawal of patronage from manufacturers who sell or attempt
to sell jobbers and retailers indiscriminately and concertedly concentrating their sales
efforts on the goods of so-called

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

loyal manufacturers ; (10) recommending or procuring the circulation of scurrilous
trade papers and/or defamatory attacks on manufacturers selling indiscriminately to
jobbers and retailers among the retail customers or prospective retail customers of such
manufacturer ; (11) cooperating with nonmember wholesale grocers or with
associations of wholesale grocers in other parts of the United States to further any of
the practices prohibited in the foregoing portions of this order.
Resale price maintenance--Standard Oil Co. of Kentucky.--A typical order on the
subject of resale price maintenance is the one entered by the commission on November
28, 1925, against the Standard Oil Co. of Kentucky in connection with the sale of oil
stoves and heaters manufactured by the Cleveland Metal Products Co. The respondent
was charged with following the practice of, and required by Order of the commission
to cease and desist from, (1) entering into contracts, agreements, or understandings
with its dealers or prospective dealers to the effect that respondents’ stoves and
heaters, manufactured by the Cleveland Metal Products Co., are to be resold by them
at prices specified or fixed by respondent; (2) procuring from its dealers or prospective
dealers any promises or assurances that its said stoves or heaters are to be resold by
them at prices specified or fixed by respondent; (3) inviting or requesting its dealers
to report the names of dealers who do not maintain respondent’s specified resale prices
on said products or wholesale suspected of not maintaining the same; (4) acting upon
reports or communications from its dealers concerning price cutting on said products
by other dealers, or manifesting to its dealers any intention to act thereon; (5)
requesting the cooperation of its dealers in the ascertainment of the source of supply
of said products on the part of a price cutter or suspected price cutter, or in any other
manner seeking the cooperation of dealers in the maintenance of prices specified or
fixed by respondent on said products.
Misrepresentations--Furniture cases.--A number of orders were issued by the
commission during the fiscal year against various furniture dealers requiring them to
cease and desist from falsely representing themselves as furniture manufacturers by
use of such trade names and slogans as “Factory-to-You Furniture,” “Factory-to-You
Furniture Store,” “Direct from the Factory,” “Factory Manufacturers Show Rooms
(Inc.),” “Associated Furniture Manufacturers warehouse Co.,” “Grand Rapids
Furniture Manufacturers Association. (Inc.).” Several of the concerns involved in these
eases were also directed to cease and desist from applying the words “Grand Rapids”
to furniture manufactured elsewhere than in the well and favorably known furniture
manufacturing center of Grand Rapids, Mich.

LEGAL DIVISION

21

Marking commodities with fictitious and exaggerated retail prices-Clayton F.
Summy Co. case.--This company, a publisher of sheet music, was charged in the
complaint of the commission with using unfair methods of competition in the stamping
of its publications with fictitious and exaggerated retail prices, thereby tending to
mislead and deceive the uninformed public as to the actual value of respondent’s
product. An order was entered by the commission on December 7, 1925, requiring the
company to cease and desist from (1) printing, stamping, or marking on its musical
publications sold in commerce a price mark which is 33 1/3 per cent higher than the
price at which it intends that its musical publications shall be sold, and at which said
publications are in fact commonly and actually sold at retail ; (2) printing, stamping,
or marking on said musical publications any fictitious price mark in excess of the price
at which it intends that its musical publications shall be, and at which said publications
are in fact usually and commonly sold at retail.
Commercial bribery.--In this case the United States Oil Co. (Inc.), and seven
individuals engaged in the sale of textile oils and allied products to mills and factories
were charged in the complaint with paying secret bribes to employees of customers
and prospective customers as an inducement to such employees to recommend and
secure the purchase of respondent’s products by such employees and principals in
preference to similar products of respondents’ competitors. In the order entered by the
commission on April 28, 1926, the respondent company and four individuals
connected therewith were required to cease and desist from giving, paying, offering,
or agreeing to give, or pay, to an employee or employees of purchasers or prospective
purchasers, without their knowledge or consent, money or other valuable consideration
as inducement to such employee or employees to recommend or procure the purchase
by their respective employer of employers in commerce between States of the United
States, of fulling and scouring oil or other textile oil or oils or allied commodities or
any of them offered for sale or sold by said respondents.
Misrepresentation of coal--Franklin Coal Co.--Respondent, a shipper of coal
throughout the State of Illinois and adjoining States, was charged in the complaint with
misrepresenting and selling coal produced from mines in Bond and Clinton Counties,
Ill., as “Mount Olive coal” and “Mount Olive district coal,” thereby tending to mislead
the public to believe that it is of the well-known high-quality coal which has for many
years been mined at Mount Olive, Ill., and in a small coal-producing district
immediately contiguous the, thereto and known as the “Mount Olive district.” The
order entered by the commission directed the respondent to cease and desist (1) from
using in advertisements, or by or through any other

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

means whatsoever, in connection with the sale or offering for sale in interstate
commerce of coal produced at Pocahontas, Bond County, Ill., and/or Breese and
Beckemeyer, Clinton County, Ill., the words or phrases “Mt. Olive,” and “Mt. Olive
district” as trade names for, or as descriptive of said coal ; (2) from using the words
or phrases “Mt. Olive” and “Mt. Olive district” as trade names for, or as descriptive
of, any coal marketed by respondent in interstate commerce, unless’ said coal has been
v produced at Mount Olive, Ill., Or in the small geographical section contiguous to
said Mount Olive, including Staunton, in said State.
Misbranding of penknives--The Long-Koch Co.--This company, a manufacturing
jeweler, was charged in the complaint of the commission with unfair methods of
competition in that it mounted with gold and base metal large quantities of penknives
on which were branded- the marks “10 K” and “14 K,” thereby tending to mislead the
public to believe that the entire mounting of the knives were made of 10-karat or 14karat gold, when in fact said mounting consisted of base metal covered, faced, or
veneered with a thin layer of gold. The order entered by the commission on May 4,
1926, required respondent to cease and desist from using the marks, symbols, or
brands “10 K” and “14 K” (1) upon or in connection with any gold-mounted knife
when the karat fineness of the entire mounting of such knife is less than the number
of karats indicated by the number in such respective mark, symbol, or brand used ; (2)
upon or in connection with any knife when the mounting thereof contains any base
metal, covered, faced, veneered, or otherwise concealed with gold unless such marks,
symbols, or brands be accompanied by words or other marks clearly indicating and
showing the quantity of gold of such karat fineness represented by said marks,
symbols, or brands which is actually used in said mounting.
Beacon Knitting Mills (Inc.).--Orders in a number of cases prohibiting the misuse of
the word “Mills” were entered by the commission, typical of which cases is the
proceeding had against the Beacon Knitting Mills (Inc.). This concern was engaged
in the business of wholesaling machine-made and handmade knit garments. The
machine-made garments were produced for it under contracts by other concerns who
operated knitting mills. The handmade garments were produced by a large number of
home knitters or persons engaged in knitting garments in their homes. The complaint
charged the respondent with an unfair method of competition in the use of the words
“Knitting Mills” in its corporate name and advertising statements of similar import
which tended to mislead purchasers into the alleged false belief that respondent is the
operator of knitting mills and the manufacturer of its garments selling direct to
purchasers to the exclusion of middlemen. All order was entered in the

LEGAL DIVISION

23

case on March 15, 1926, by which respondent: was required to cease and desist (1)
from using the words “Knitting Mills,” or either of them, or words of like import, in
or as a trade name or corporate name for carrying on the. business of selling and
distributing machine-made knit garments in interstate commerce unless and until the
respondent actually owns or directly controls or operates a mill or mills in which said
garments are manufactured or produced; (2) from making, in connection with the sale
and distribution of knit garments in interstate commerce, representations through
advertisements, circulars, business stationery, trade names, or in any manner
whatsoever, to the effect that respondent is the manufacturer or maker of the garments
dealt in by it (a) when such garments as may be machine made were in fact not
manufactured in a mill or factory directly controlled or operated by respondent, and/or
(b) when any of such garments as may be handmade were produced by persons who
are commonly known in the knit-goods trade as “home knitters” and “home
crocheters.”
DISMISSAL OF COMPLAINTS

Up to June 30, 1926, the commission had dismissed 487 complaints. While the
commission in many instances does not include its reasons in an order of dismissal, a
study of the records indicates the following elements were given weight:
Controlling court decisions
Dismissed without prejudice
Respondent out of business
Practice discontinued
Practice discontinued by stipulation
Practice as used by respondent not unfair
No public interest
No jurisdiction
Disposed of by civil litigation
Lack of proof
Faulty pleadings
Miscellaneous

71
63
43
43
13
43
32
31
8
61
2
21

Seventy-one cases are listed as being dismissed because of controlling decisions.
Of this number, 39 were cases held in abeyance until the decision of the Supreme
Court in the Beech-Nut Packing Co. case, 257 U.S. 441. There was reason to believe
that the respondents in these cases had violated the law, but the respondents contended
that, as the decision of the Supreme Court constituted in reality new law on the
subject, they should be given an opportunity to conform their practices in accordance
with that courts decision. Complying with this request, these cases were dismissed
after the Beech-Nut case, with notice that the commission would cause new

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

investigations to be instituted to ascertain whether the respondents conducted their
business in line with the Beech-Nut decision.
Those complaints dismissed without prejudice were cases in which it was generally
found that because of the age of the case or the fact that the practice was not employed
extensively or had been discontinued it was thought best to dismiss without prejudice
with the right to renew the action in the event the respondent continued the acts
complained of. Forty-three cases were dismissed because upon final hearing the
respondents either could not be found or had gone out of business. In this class of
cases evidence was usually available to sustain the charges of the complaint. In 43
cases the complaints were dismissed because the practice condemned had been
discontinued and in 32 cases because of lack of public interest. These were the less
important cases and were dismissed because of the age of the cases and the lack of
funds with which to reinvestigate the more or less minor matters involved for the
purpose of ascertaining conditions prevailing at the time of dismissal, and it was
decided that to proceed further would not be in the public interest. Thirty-one cases
have been dismissed for lack of jurisdiction because it could not be proved that the
acts complained of were done in interstate commerce, thus leaving the commission
without jurisdiction. Those disposed of because of civil litigation are cases in which
the respondent had already been proceeded against in the courts prior to the
commission reaching these cases, but not prior to the institution of the commissions
case. In these eight cases the respondents were successfully proceeded against in the
courts.
The foregoing indicates that only a small percentage of com plaints have been
dismissed because the respondents were not found to have violated the law as charged.
In some of those cases noted as being dismissed for lack of proof the commission was
unable to proceed with trial within a reasonable time after the original investigation.
Later, when these cases were taken up for trial, it was found that the facts disclosed
by the original investigation could not be substantiated, oftentimes by reason of the
disappearance, of witnesses. The number listed as being dismissed for lack of proof
are those in. which public announcement was made of the fact.
COURT CASES
Appeal may be made to the United States Circuit Courts of Appeals, either by the
commission to enforce its order or by the respondent to have the order set aside. The
number of court proceedings in which the commission has been involved during the
year, as well as a cumulative showing of this work throughout the com-

LEGAL DIVISION

25

mision’s life, will be found in the statistical tables oil pages 79 to 81 of this report.
From these it will be noted that the commission has issued 752 orders to cease and
desist, and appeals for review of these orders have been taken in only 67 cases. Only
32 of these appeals have been decided against the commission by the United States
Circuit Court of Appeals, and in two (2) of these the commission has been sustained
by the Supreme Court of the United States.
The pages immediately following contain brief descriptions of cases in courts during
the year.
CASES IN UNITED STATES SUPREME COURT

The Claire Furnace Co. case--Investigation instituted by the commission upon its
own motion, but after suggestions and conference with the Committee on
Appropriations Of the House of Representatives.--In this case the commission sent
questionnaires to practically all corporations engaged in the manufacture and sale in
interstate commerce of steel products, requesting monthly reports showing quantities
of products manufactured, plant capacity, orders booked during the month, cost of
manufacturing, prices at which sold in domestic and foreign commerce, and general
income statement and balance sheet. The declared purpose of the inquiry was to
publish the information acquired in totals; to show existing conditions in the
production and sale of steel products. Certain corporations declined to make reports
and joined in a suit in equity to restrain the commission from proceeding in any
manner to compel the production of the information or to impose any penalties for
failure to produce it.
The Supreme Court of the District of Columbia, in which the t suite was instituted,
issued a permanent injunction enjoining the commission on the ground that the
information sought was not information respecting interstate commerce nor
information with respect to matters so directly affecting such commerce that it could
be required under the commerce clause of the Constitution.
The commission appealed to the Court of Appeals of the District of Columbia, which
affirmed the decree: of the lower court. The commission then took the case to the
Supreme Court of the United States, where it was argued on December 6,1923.
On April 20, 1925, the Supreme Court directed reargument, which was had on
November 24, 1925, and at the close of the fiscal year the case was awaiting the
decision of the court.
The Swift case--Acquisition of stock in violation of section 7 of the Clayton Act.--The
commission in instituting its proceeding against Swift & Co. charged that the
respondent, by taking over the Moultrie Packing Co. and the Andalusia Packing Co.
in the

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

name of its employees and acquiring a controlling interest in England, Walton & Co.
(Inc.) had materially lessened competition tended to create. a monopoly in interstate
sale of meats and the products and by-products arising out of the slaughtering of
livestock and in the business of conducting tanneries and the production of various
kinds of leather.
After trial the commission directed Swift & Co. to divest itself of the capital stock
of the Moultrie and Andalusia companies, “including ail the fruits of such acquisition.”
The portion of the complaint relating to England, Walton & Co. was severed and
formed the basis of another proceeding.
Swift & Co. appealed to the United States Circuit Court of Appeals for the Seventh
Circuit, and as a basis for its appeal contended that the statute (sec. 7 of the Clayton
Act) was unconstitutional unless the court should read into it certain additional
requirements, to wit, that the competition between the absorbing and absorbed
companies prior to consolidation was substantial and that the effect of the acquisition
was injurious to the public. The court sustained the commission’s order in every
particular. The case was taken to the Supreme Court of the United States on writ of
certiorari granted November 23, 1925, on unopposed petition of Swift & Co., where
the matter is now awaiting the filing of briefs and oral argument, and will be heard
October 25, 1926.
The Western Meat Co. case--Another instance of stock acquisition in violation of
section 1 of the Clayton Act.--This is another packing-house proceeding. The charge
is similar to that in the Swift and Armour cases, refereed to in this report, namely,
alleged violation of section 7 of the Clayton Act--the company acquired in this
instance being the Nevada Packing Co.--and the consequent lessening of competition
and tendency to create a monopoly in the sale in interstate commerce of meats and the
products and by-products arising out of the slaughtering of livestock.
The commission ordered respondent to divest itself of stock and properties of the
Nevada Packing Co. Respondent filed its petition for review with the United States
Circuit Court of Appeals for the Ninth Circuit. The case was argued on May 15, 1924,
and decided September 2, 1924, the commission’s contentions being upheld.
Subsequently the Western Meat Co. petitioned for rehearing of the case. The petition
was allowed, briefs filed, and the case reargued on February 2, 1925.
On February 17, 1925, the court rendered its decision modifying the order of the
commission. In the rehearing the court directed its attention to that portion of the order
providing “that in. such divestment no stock or property above mentioned to be so
divested shall be sold and transferred directly or indirectly to any stockholder, officer,

LEGAL DIVISION

27

director, employee, or agent of, or anyone connected directly or indirectly with or
under the influence of, respondent or any of its officers,” etc.
The court held that the authority of the commission was limited to commanding the
offending corporation to desist from holding stock in the other corporation and that the
commission’s authority did not extend so far as to enable it to prevent the acquisition
by the western Meat Co. of the “plant and property of the Nevada Packing Co.”
The limitation placed upon the authority of the commission by the decision of the
court after reargument being in direct conflict with the decisions rendered by other
circuit courts in similar cases, and the commission being of the opinion that to permit
the western Meat Co. to acquire the plant and properties of the Nevada Packing Co.
would leave the western Meat Co. in the same controlling position (with respect to the
elimination of competition) as if it held the capital stock of such company, and would
make the act of stock divestiture an empty gesture, and being of the belief that a
principle of great importance to the public was involved, petitioned the United States
Supreme Court for writ of certiorari. That court, on June 1, 1925, granted the petition,
and the case at the close of the fiscal year awaits brief and argument in the Supreme
Court in granting a motion to advance, filed on behalf of the commission, the case was
assigned by the court for argument on October 25, 1926.
The Thatcher Manufacturing Co. case--Violation of section 7 of the Clayton Act-Milk bottles.--It was charged in the complaint, and, after hearing, found, that the
Thatcher Manufacturing Co., a large manufacturer of milk bottles, acquired the capital
stock of its competitors, the Essex Glass Co., Travis Glass Co., Lockport Glass Co.,
and Woodbury Glass Co., in violation of section 7 of the Clayton Act. It was also
charged, and proved, that after acquiring the stock of the four-named companies, the
Thatcher Manufacturing Co. caused the Essex, Travis, and Lockport companies to
transfer and convey to the Thatcher Co. all their assets and properties and then to be
dissolved, which transfer and dissolution was an artifice and subterfuge to evade the
law, and that the respondent secured and retained the fruits and benefits of such
violation ; that the effect of the acquisition of the capital stock of the four companies
by the Thatcher Co. was to eliminate all competition in the milk-bottle business
between the respondent and the four-named companies acquired by it and between
those companies, to restrain commerce in the milk-bottle business, and to tend to
create a monopoly in that business in the Thatcher Co.
Before these acquisitions, the Thatcher Co. produced and sold about 40 per cent of
all the milk bottles manufactured in the United
15173---26-----3

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

States. After the acquisitions it produced and sold in commerce about 70 per cent, and
the president of the Thatcher Co. made the following statement in writing:
The Thatcher Manufacturing Co. will have the exclusive right to make milk bottles by the
only successful bottle-making machines devised and to manufacture and sell about 90 per cent
of all the milk bottles manufactured In the United States.

The commission also found that the transfer of the assets of the Essex, Travis, and
Lockport companies to the Thatcher Co. and ‘the dissolution of the first three named
companies was an artifice or subterfuge of the Thatcher Co. to evade the Clayton Act
and by which respondent secured and enjoyed the fruits and benefits of its illegal
acquisitions of the stock of these competitors.
After full hearings the commission, on December 31, 1923, directed the Thatcher
Manufacturing Co. to cease and desist from the ownership, operation, management,
and control of the assets, plants, properties, rights, and privileges which it acquired
from the Essex, Travis, and Lockport companies in violation of the Clayton Act, and
further to divest itself of all capital stock of the Woodbury Glass Co. The Thatcher Co.
declined to comply with this order, and on March 31, 1924, the commission applied
to the United States Circuit Court of Appeals, Third Circuit, to enforce the order. By
decision rendered April 16, 1925, the court sustained the commission 5 order so far as
it related to the assets and properties of the Essex, Travis, and Lockport companies and
granted enforcement thereof. The court found that the Woodbury Co. was engaged
chiefly in the manufacture of condiment and whiskey bottles ; that its manufacture of
milk bottles was small, and because its milk-bottle business, unlike that of the other
companies, was so inconsiderable that the lessening of competition thereby was not
substantial, as required by section 7 of the Clayton Act. That part of the order relating
to the Woodbury Co. was therefore not approved by the court.
Respondent contended in this court that by absorbing the assets of and dissolving the
Essex, Travis, and Lockport companies the commission was without power to enter
an order effecting this transaction, as the stock had been destroyed, and that the act
gave the commission jurisdiction over stock only, and not over physical assets The
court overruled this contention.
Thereafter the case was taken to the Supreme Court of the United States by writ of
certiorari granted May 3, 1926, on petition of the Thatcher Manufacturing Co. On
motion to advance, filed on behalf of the commission, the Supreme Court assigned the
case for argument on October 25, 1926. At the close of the fiscal year the case awaited
briefs and argument.

LEGAL DIVISION

29

Eastman Kodak Co. case.--It was charged and found by the commission that, with
the purpose, intention, and effect of stopping the importation of foreign-made film into
the United States and eliminating the competition offered by such foreign-made film,
the Eastman Co. acquired the Paragon, G. M., and Sen Jacq laboratories, three fully
equipped film-printing and developing laboratories, the combined capacity of which
was equal to that of all existing laboratories east of Chicago ; that it did not operate
said laboratories but held them, fully equipped, as a threat and means of coercing its
customers, the film-printing laboratories, into buying their film exclusively from the
Eastman Co. to the exclusion of foreign-made film produced by competitors ; that as
a result of such threat and coercion the East man Co. compelled the consumers of film
to enter into an unlawful agreement, combination, and conspiracy with it to use
exclusively American-made film to the elimination or exclusion of imported foreignmade film; and in consideration of the adherence to such agreement by the film
consumers, the Eastman Co; refrained from using said three laboratories acquired by
it, but holds them in constant readiness to enter the business of printing film in
competition with its customers, the laboratory consumers of film; that the effect of said
unlawful combination is to exclude foreign-made film from the United States, thus
leaving the Eastman Co. with a virtual monopoly and in complete control of the
positive cinematograph film industry in the United States.
After hearings, the commission made findings and entered an order on April 18,
1924, directing respondents to cease and desist from conspiring, combining,
confederating, agreeing, and cooperating between or among themselves to hinder and
restrain competition in the manufacture and sale of film or to maintain and extend the
monopoly of the Eastman Co. in the distribution and sale of positive film by, among
others, the use of agreements not to use foreign-made film. It was further ordered that
the Eastman Co. should with all due diligence dispose of the Paragon, G. M., and Sen
Jacq laboratories in order to restore competitive freedom in the distribution and sale
of film because the commission found that the Eastman Co. did not operate these
laboratories but acquired and held them for the purpose of threatening and coercing
the film laboratories of the United States into refraining from buying foreign-made
film and to use only American-made film of which the Eastman Co. has a monopoly.
Shortly thereafter, petitions for review of the commission’s order were filed in the
United States Circuit Court of Appeals, Second Circuit, by the Eastman Co. and 5 of
the other 17 respondents. In a decision rendered on May 18, 1925, the court affirmed
the order of the commission, except that part which directed the Eastman Co.

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

to dispose of the three laboratories acquired by it, namely, the Paragon, G. M., and Sen
Jacq.
In a dissenting opinion, Judge Manton stated he believed the order of the
commission should be affirmed in all respects, holding that the commission has power
to order a respondent to dispose of property acquired by it which it is found using as
a means of unfair competition in trade.
On October 26, 1925, the Supreme Court granted a writ of certiorari on petition of
the commission to review the above-mentioned decision of the Circuit Court of
Appeals. The case is low before the Supreme Court awaiting briefs and argument.
Pacific States Paper Trade Association--Price fixing in paper products on the
Pacific coast.--This complaint involved, besides the Pacific States Paper Trade
Association and 35 specifically named respondents, the following five trade
associations operating in Pacific coast territory.
Seattle-Tacoma Paper Trade Conference.
Spokane Paper Dealers.
Portland Paper Trade Association.
Paper Trade Conference of San Francisco.
Los Angeles Wholesale Paper Jobbers’ Association.
The respondents embraced practically all wholesale dealers in paper and paper
products throughout the States of Oregon, Washington, and California. Other States
affected in great part by the activities of the respondents are Idaho, Nevada, Arizona,
Montana, New Mexico, and the Territory of Alaska.
Respondents were charged with combining and conspiring together to fix and
enhance prices of paper and paper products throughout the Pacific States, and to
confine the distribution thereof through wholesale channels, all with the effect of
substantially lessening and restraining competition and hindering the natural flow of
commerce in paper and paper products in channels of interstate trade. Among the
means charged as being employed by respondents to effectuate their alleged unlawful
schemes are coercion, boycotting, and intimidation of manufacturers into cutting off
sources of supplies of those competitors who failed to abide by the fixed prices and
conditions laid down by said combination.
The Pacific States Paper Trade Association et al. petitioned the Circuit Court of
Appeals for the Ninth Circuit for review of certain parts of the commission’s order
(five subdivisions). Briefs were filed, argument had and in February, 1925, the opinion
of the court was handed down sustaining the commission on two of said subdivisions,
slightly modifying one subdivision, and reversing the commission on the two
remaining subdivisions.

LEGAL DIVISION

31

Petition for rehearing filed by the commission was denied on March 9, 1925.
Petition for certiorari was then filed by the commission in the United States Supreme
Court, which petition was granted May 25, 1925. Commission’s brief has been filed,
and at close of the fiscal year the case awaits respondents’ brief and oral argument,
which is expected to be had during the October term, 1926.
The American Tobacco Co. case--Price agreements on tobacco products.--The
commission’s order in this case, directed against practically all of the wholesale
tobacco dealers in and about Philadelphia, commanded these dealers to cease and
desist from fixing, enforcing, and maintaining and from enforcing and maintaining by
combination, agreement, or understanding among themselves, or with or among any
of them, or with any other wholesaler of cigarettes or other tobacco products, resale
prices for cigarettes or other tobacco products dealt in by such respondents, or any of
them, or by any other wholesaler of cigarettes or other tobacco products.
The American Tobacco Co., which also appeared as one of the respondents in this
proceeding, was directed to cease and desist from assisting and from agreeing to assist
any of its dealer-customers in maintaining and enforcing in the resale of cigarettes and
other tobacco products manufactured by the said the American Tobacco Co. resale
prices for such cigarettes and other tobacco products, fixed by an such dealer-customer
by agreement, understanding, or combination with any other dealer-customer of said
the American Tobacco Co.
The American Tobacco Co. was the only one of the respondents to appeal from the
order, and it filed its petition for review in the Court of Appeals for the Second Circuit.
The case was argued on November 19, 1924, and on October 20, 1925, the court
reversed the order of the commission. The commission applied to the Supreme Court
of the United States for a writ of certiorari to review the decision of the Court of
Appeals on the ground that the lower court appears to hold the commission’s finding
of price agreement between the jobbers and the manufacturer was not supported by
evidence; that it is lawful for the manufacturer to aid and abet jobbers in making
effective their illegal price agreement; that it is not unlawful for a jobbing association
to agree to fix prices and prevent members and nonmembers who do not observe the
agreed price from procuring goods; that it is not an unfair method of competition for
a manufacturer to join with a jobbers’ association in compelling observance of prices
illegally agreed upon; that it is unlawful for jobbers to sell goods at prices satisfactory
to themselves and which, in the past, have sustained their business, though such prices
may be lower than those agreed upon by the members of the association of competing
jobbers; and, conversely, that it is fair

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

competition for jobbers to combine to coerce competitors into charging prices which
they have agreed upon as satisfactory to themselves; that a combination in restraint of
interstate commerce in violation of the Sherman Act is not also an unfair method of
competition ; that it is not to the interest of the public to prevent jobbers from agreeing
upon prices at which they will sell and from agreeing to prevent those who will not
observe their prices from getting the goods.
The petition for certiorari was granted by the Supreme Court on March 8, 1926, and
at the close of the year the case was awaiting hearing.
The Shade Shop case--Appropriation and simulation of trade name.--This is a
District of Columbia case. Alfred Klesner, doing business under the name and style
of “Shade Shop, Hooper & Klesner," was charged by the commission with a violation
of section 5 of the Federal Trade Commission act, in that he had appropriated and
simulated the trade name “The Shade Shop “ adopted by one W. Stokes Sammons in
connection with his business of manufacturing and selling window shades. Sammons
had been engaged exclusively in the business since 1901.
The commission’s order prohibited Klesner, his servants, agents, and employees
from using the words “Shade Shop" standing alone or in conjunction with other words
as an identification of the business conducted by him, in any manner of advertisement,
signs, stationery, telephone, or business directories, trade lists, or otherwise.
The respondent having refused to comply with the order, the commission, on May
13, 1924, filed, in the Court of Appeals for the District of Columbia, its petition for
enforcement thereof. The case was argued November 5, 1924, and decision of the
court rendered on June 1, 1925. The sole question discussed in the court’s opinion
was’ the matter of its jurisdiction to enforce the commission’s orders in the District of
Columbia, and the commission’s petition was dismissed the ground that the court had
no jurisdiction. The case is now pending in the Supreme e Court of the United States
on certiorari where it awaits briefs and argument.
The Procter & Gamble Co. case--False advertising and misbranding--Soap.--Procter
& Gamble Co. manufactures soap, some of which it advertises and sells as “P & G
White Naphtha Soap.” It also manufactures and sells a washing powder under the
name of “Star Naphtha Washing Powder.” The commission alleged that at the time
such soap and powder are sold to the consuming public the contain no naphtha nor do
they contain any petroleum distillate in an amount sufficient to be effective as a
cleansing ingredient.

LEGAL DIVISION

33

After hearing, the commission ordered Procter & Gamble Co. to cease using the
word “Naphtha “ as a brand name for any soap or soap products when such
commodities at the time of their sale to the consuming public contain no naphtha, or
naphtha in an amount of 1 per cent or less by weight.
The company, on August 28, 1924, petitioned the Circuit Court of Appeals for the
Sixth Circuit to review the commission’s order. On January 5, 1926, the court rendered
its decision sustaining the first section of the commission’s order prohibiting the use
of the word “Naphtha” as a designation for a kerosene ingredient of soap. The court,
however, vacated the remaining part of the commission’s order which prohibited the
use of the word “Naphtha” don soap containing not more than 1 per cent of naphtha
(a volatile ingredient) at the time of sale to the consumer, the court indicating that the
order should have been directed to the naphtha content to be placed in the soap at the
time of manufacture. Thereafter, both parties filed petitions for rehearing, which were
denied by the Circuit Court of Appeals on April 7, 1926. The Procter & Gamble Co.
then filed a petition in the Supreme Court of the United States for certiorari, to which
the commission filed a cross petition likewise praying for certiorari because, among
other things, it is the contention of the commission that the regulation of the amount
of naphtha to be placed in the product at the time of manufacture, as the Circuit Court
of Appeals indicates, is not sound.
At the closed of the fiscal year the case was awaiting the action of the Supreme
Court.
CASES IN UNITED STATES CIRCUIT COURTS OF APPEAL

The Utah-Idaho Sugar Co. case--Suppression of competition in the manufacture and
sale of beet sugar.--The respondents in this case--namely, the Utah-Idaho Co., the
Amalgamated Sugar Co., E R. Wooley, A. P. Cooper, and E F. Cullen--were charged
by the commission with stifling and suppressing competition in the purchase of sugar
beets and in the manufacture and sale of refined beet sugar, by means of a combination
or conspiracy involving, among others, the following unfair trade practices:
(1) The circulation of false, misleading, and unfair reports as to competitors and
prospective competitors (a) concerning financial standing and responsibility ; (b) that
they would be unable to secure sugar-beet seed, or the beets, or to pay for those they
did purchase ; (c) that their contemplated factories would not be built, etc.
(2) The circulation of false reports to the effect that respondents (a) occupied all the
producing territory in which their competitors contemplated operating ; (b) had
contracts for all the beets’ to be grown, etc.

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

The commission, after very extensive hearings, dismissed the com plaint as to the
respondent E F. Cullen and entered its order to cease and desist against the other
respondents. The respondents filed petitions for review in the Circuit Court of
Appeals for the Eighth Circuit.
The commission, as required by statute, filed with the court a transcript of the
record, consisting of 13,428 pages of testimony and approximately 6,000 pages of
exhibits.
Subsequent to the filing of transcript, the court ordered the petitioners to prepare and
serve a condensed narrative of the transcript. Counsel for petitioners (Utah-Idaho
Sugar Co.) sought (by motion) a modification of the order concerning the preparation
and service of the condensed narrative. This was opposed by the commission, and the
motion was denied. In compliance with the court’s order all the petitioners except
Wooley prepared and served on the commission a condensed narrative of the record.
This condensed narrative consists of four bound volumes, a total of 1,433 pages.
Petitioner Wooley having failed to prepare and serve a condensed narrative, the
commission filed a motion within the time specified by the court to dismiss his petition
for review. Wooley opposed this motion, briefs were filed, and the question arising
upon the motion was argued. This motion was denied by the court, which at the same
time granted Wooley leave to adopt as his abstract of record the abstract prepared by
the Utah-Idaho Sugar Co. Sub. sequently, on September 14, 1925, the case was called
by the court and continued to the September term, 1926, and thereafter by stipulation
continued to the December, 1926, term at St. Louis. The case is therefore in that court
awaiting briefs and argument
Minneapolis Chamber of Commerce case.--In this case respondents were charged
with engaging in a confederation and conspiracy to maintain a monopoly of the grain
trade at Minneapolis and the immediate surrounding territory ; and that, in order to
carry out the monopoly and destroy the business of its competitors, the chamber of
commerce and its organization were used as a medium through which the unfair
methods of competition were accomplished by its members in violation of section 5
of the Federal Trade Commission act.
After hearing, the commission entered its order on December 28, 1923, directing the
Chamber of Commerce of Minneapolis and the other respondents to cease and desist
from combining and conspiring among themselves or with others, directly or
indirectly, to interfere with, or injure, or destroy the business or the reputation of the
St. Paul Grain Exchange, or its officers and members, or the Equity Cooperative
Exchange, or its officers and stockholders (or

LEGAL DIVISION

35

other competitors of the respondent chamber and its members), by (1) publishing or
causing to be published in any newspaper, periodical, pamphlet, or otherwise, or
circulating, or causing to be circulated orally or otherwise, among the customers or
prospective customers of the members of the St. Paul Grain Exchange, or the public
generally, any false or misleading statements concerning the financial standing, the
business, or the business methods of the said exchange, its officers, or members, or
concerning the said Equity Cooperative Exchange, its officers or stockholders; (2)
instituting vexatious or unfounded suits either at law or in equity against said Equity
Cooperative Exchange with the purpose or intent or with the effect of hindering or
obstructing the business of the said Equity Cooperative Exchange or injuring its credit
and reputation.
The order likewise directed these respondents to cease and desist from-(a) Combining and conspiring among themselves or with others, directly or
indirectly, to induce, persuade, or compel, and from inducing, persuading, or
compelling any of the members of said chamber, their agents or employees, to refuse
to buy from, sell to, or otherwise deal with the St. Paul Grain Exchange or its members
or the Equity Cooperative Exchange or its stockholders, or the customers of any of
them, because of the patronage dividend plan of doing business adopted by the said
Equity Cooperative Exchange, or by any of the members of the said St. Paul Grain
Exchange, as more particularly set forth in paragraph (4), infra, of this order.
(b) Hindering, obstructing, or preventing any telegraph company or other
distributing agent from furnishing continuous or periodical price quotations of grains
to the St. Paul Grain Exchange or its members or to the Equity Cooperative Exchange
or its stockholders.
(c) Passing or enforcing any rule or regulation, or enforcing any usage or custom,
that prohibits or prevents members of the respondent chamber from conducting their
business of dealing in grain according to the cooperative method of marketing grain
or according to the patronage dividend plan, like or similar to the method or plan
adopted by the Equity Cooperative Exchange.
(d) Denying to any duly accredited representatives of any organization or
association of farmer grain growers or shippers admission to membership in said
respondent chamber, with full and equal privileges enjoyed by any or all of its
members or by any or all concerns represented by membership in said respondent
Chamber of Commerce, because of the plan or purpose on the part of such organization or association to pay or purpose to pay patronage dividends or to operate or
purpose to operate according to the cooperative plan of marketing grain, namely, the
plan of returning any portion or
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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

all of its earnings or surplus to its patrons or members on the basis of patronage,
whether such earnings or surplus is derived from charging patrons or members
commissions or otherwise.
(e) Passing or enforcing any rule or regulation, or enforcing any usage or custom,
that compels shippers of grain to Minneapolis; Minn., from country points or from St.
Paul, Minn., to pay commission or other charges, unless and until like commissions
and charges are paid by shippers of grain to Minneapolis from Omaha, Nebr., or from
Kansas City, Mo., or other such favored markets.
(f) Passing or enforcing any rule or regulation, or enforcing any usage or custom,
that prohibits members of the respondent chamber, when buying grain on track at
country points from paying therefor more than the market price of similar grain
prevailing at that time in the exchange room of the respondent chamber, less freight,
commissions, and other charges.
(g) Promulgating, interpreting, or enforcing any rule, custom, regulation, or usage
in such a manner as to require any member of respondent chamber to pay to the
farmer, or country shipper, or other person, a price for grain limited to a price
equivalent to or identical with the Minneapolis market price, or otherwise limit the
exercise of free will and individual independent judgment of any such member as to
the price which he shall pay, or which ho desires to pay, farmers, country shippers, or
others for grain on track at country points.
Petition for review and vacation of the commission’s order was filed by respondents
in the United States Circuit Court of Appeals for the Eighth Circuit. The case was
argued and submitted on May 25, 1925, and was still awaiting the decision of the court
at the close of the fiscal year. (However, shortly after the close of the year, on July 13,
1926, the court rendered its decision sustaining the commission’s order with the
exception of the above paragraphs marked (b), (c), (d), (e), (f), and (g), which were set
aside.)
Pure Silk Hosiery Mills case--False advertising--False representations in sale of
hosiery.--The Pure Silk Hosiery Mills sold hosiery to the consuming public generally
throughout the United States. Although it neither owned nor operated any factory, it
represented by a great variety of means that the hosiery it offered for sale and sold was
manufactured in mills owned and operated by it; that customers in purchasing from it
obtained hosiery at whole-sale or mill prices; that in buying from it purchasers
eliminated middlemen’s profits and derived many advantages (in price and otherwise)
which they could not obtain if they purchased hosiery in the regular channels. The
commission’s complaint alleged that the use by respondent company of the word
“Mills” in its name, when it neither owned nor operated any hosiery mill, was in
violation of

LEGAL DIVISION

37

section 5 of the Federal Trade Commission act. On October 24, 1922, the commission
directed the Pure Silk Hosiery Mills to cease selling hosiery in interstate commerce
“under a trade or corporate name which includes the word ‘Mills’ in combination with
the words ‘Pure Silk Hosiery,’ or words of like import,” unless and until respondent
actually owns or operates a factory or mills in which it manufactures the hosiery sold
by it.
Subsequent investigation by the commission disclosed that its order was being
ignored, and the commission on December 30, 1924, petitioned the Circuit Court of
Appeals for the Seventh Circuit for enforcement. The Pure Silk Hosiery Mills
contested the commission’s petition for enforcement. Briefs were filed, argument had,
and the court, on December 8, 1924, granted the petition of the commission and by
decree adopted the order of the commission and commanded the Pure Silk Hosiery
Mills to obey it. Petition for rehearing was filed by the company and denied by the
court.
Subsequently the commission deemed the Pure Silk Hosiery Mills to be acting in
violation of the decree of the Circuit Court of Appeals mentioned above, and on June
29, 1925, filed its petition with the same court to enforce the decree. Hearing on the
petition was had before the court on January 7, 1926, and at the close of the fiscal year.
the matter was awaiting decision.
John C. Winston Co. case--Books, etc.--The John C. Winston Co. is a seller and
distributor of books, encyclopedias, etc., in interstate commerce. The commission in
its complaint charged that the Winston company brought about sales by means of false
representations and by using highly deceptive methods.
Full hearing was had before the commission, and on August 13, 1924, the
commission issued its order requiring the Winston company to cease and desist from
making the false representations as charged in the complaint.
On September 15, 1924, the Winston company filed petition for review in the Circuit
Court of Appeals for the Third Circuit. Decision was rendered on February 27, 1925,
the court vacating the order of the commission on the grounds that one of the deceptive
practices used by the Winston company in the sale of its products had been abandoned
by that company prior to the issuance of the commission’s complaint, and that the
second practice condemned by the commission as unfair and in violation of section 5
of the Federal Trade Commission act did not constitute an unfair method of
competition within the intent and meaning of that act. The commission, on May 26,
1925, filed a petition for certiorari in the United States Supreme Court, which petition
was on October 12, 1925, denied.
The Chicago Portrait Co. case--Misrepresentation in the sale of portraits made from
photographs.--The Chicago Portrait Co. was

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

engaged in the business of enlarging photographs into portraits. During the course of
this business it obtained orders for such portraits by means of drawings for so-called
“Lucky envelopes” or by giving trade checks for one-half the pretended purchase
price, thereby deceiving the prospective purchaser into believing that lie was obtaining
the portraits in question at prices substantially below their usual selling prices.
Furthermore, the respondent misrepresented its portraits to be hand paintings. Another
allegation of the complaint was that the company induced the purchasing public to sign
contracts for the reproduction of photographs by falsely representing the contracts to
be receipts for the photographs obtained from the customers, whereas, as a matter of
fact, the contracts in question contained numerous provisions of a binding nature on
the customer, which were neither explained to nor understood by the customers, and
which served to nullify verbal agreements previously made.
The commission entered an order to cease and desist, and the Chicago Portrait Co.
filed petition for review with the Circuit Court of Appeals for the Seventh Circuit. On
December 23, 1924, the court vacated the order of the commission. It conceded that
the practices of the Chicago Portrait Co. were reprehensible, and that the public was
deceived, but held that no injury to either customers or competitors resulted.
The commission’s petition for rehearing was denied. Petition for certiorari was filed
in the United States Supreme Court on May 27, 1925, and on October 12, 1925,
denied.
Toledo Pipe Threading Machine Co. case--Regale price maintenance--Tolls.--The
commission charged the Toledo Pipe Threading Machine Co. with maintaining and
enforcing a resale price-maintenance plan and policy.
After hearing, the commission issued its order requiring the Toledo Pipe -Threading
Machine Co. to cease and desist from maintaining its suggested resale prices by
various means and methods enumerated in the order.
The company, on March 4, 1925, filed in the Circuit Court of Appeals for the Sixth
Circuit a petition for review. Decision was rendered by the court on March 12, 1926,
affirming three paragraphs of the commission’s order and vacating the fourth and last
paragraph.
The order affirmed requires the respondent to cease and desist from maintaining its
suggested resale discounts by (1) requiring from dealers assurances that they will be
governed by the suggested resale discounts in the disposal of stocks previously
purchased, as a condition precedent to subsequent sales to them by respondent; (2)
requiring from dealers placing orders assurances that the commodities so ordered will
be resold at the suggested resale discounts as a condition

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39

precedent to the acceptance of such orders; (3) requiring from dealers generally
assurances that they will be governed by the suggested resale discounts in all resales
of respondent’s products, under threat of discontinuance of relations.
The case now stands closed.
Q. R.. S. Music Co. case--Resale price maintenance in the sale of music rolls.--In
this case the commission issued its order directing the Q. R. S. Music Co., of Chicago
(a manufacturer of music rolls for player pianos having produced in excess of
6,000,000 rolls per annum), to cease and desist from carrying into effect a policy of
fixing and maintaining uniform price’s at which the articles manufactured by it shall
be resold by its distributors and dealers by-(1) Entering into contracts, agreements, and understandings with distributors or
dealers requiring or providing for the maintenance of specified resale prices on
products manufactured by respondent.
(2) Attaching any condition, express or implied, to purchases made by distributors
or dealers to the effect that such distributors or dealers shall maintain resale prices
specified by respondent.
(3) Requesting dealers to report competitors who do not observe the resale price
suggested by respondent, or acting on reports so obtained by refusing or threatening
to refuse sales to dealers so reported.
(4) Requesting or employing salesmen or agents to assist in such policy by reporting
dealers who do not observe the suggested resale price, or acting on reports so obtained
by refusing or threatening to refuse sales to dealers so reported.
(5) Requiring from dealers previously cut off promises or assurances of the
maintenance of respondent’s resale prices as a condition of reinstatement.
(6) Utilizing any other equivalent cooperative means of accomplishing the
maintenance of uniform resale prices fixed by the respondent.
The order also required respondent to cease and desist from entering into contracts,
agreements, or understandings with its dealers binding them not to deal in the products
of respondent’s competitors.
Respondent filed in the United States Circuit Court of Appeals for the Seventh
Circuit its petition for review. This was denied on April 9, 1926.
The Armour case--Acquisition o/ stock in violation of section 7 of the Clayton Act.-The commission’s complaint in this case charged the respondent, Armour & Co., meat
packers, with violation of section 7 of the Clayton Act in acquiring a large part of the
capital stock of the E. H. Stanton Co., of Spokane, Wash.
Prior to the acquisition of its stock by Armour & Co., the Stanton concern was
engaged in a similar line of business in active competi-

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

tion with the acquiring company. The commission charged that the effect of the
acquisition of stock was to substantially lessen competition between the two
companies and to tend to create a monopoly in the purchase of cattle and livestock and
in the sale of meat and meat products.
In its order the commission directed the Armour Co. to divest itself of all the capital
stock and properties of the Stanton Co.
The Armour Co. filed its petition for review with the United States Circuit Court of
Appeals for the Seventh Circuit. Subsequently the case was reopened before the
commission by order of the court. Additional testimony was taken and argument
before the commission had on the additional evidence so submitted. A supplemental
transcript of the record was filed with the court on December 31, 1924, and further
proceeding in the matter is pending the decision in the Swift case, referred to
hereinabove.
Hills Bros. case--Resale price maintenance--Coffee.--Hills Bros., a corporation, is
engaged, among other things, in the business of roasting and selling coffee in interstate
commerce, the sale of two brands having approximated 25,000,000 pounds per annum.
The commission charged the corporation with maintaining an effective resale price
maintenance plan and policy by means of which it compelled dealers to maintain the
resale prices fixed by it. The complaint contained 12 paragraphs devoted to the means
used by Hills Bros. in inducing or compelling dealers to abide by the arbitrary resale
prices so fixed by the concern.
Hills Bros., in answering said complaint, admitted the existence of a minimum resale
price plan for the sale of its coffee, but contended that the means used to carry such
plan or policy into effect were lawful means and that its resale price maintenance
policy was beneficial to the public and was not in violation of section 5 of the Federal
Trade Commission act.
After hearing the case, the commission issued its order requiring the corporation to
cease and desist from carrying into effect by cooperative methods its system of
minimum resale prices.
On February 17, 1925, Hills Bros. filed a petition for review in the Circuit Court of
Appeals, Ninth Circuit. The contentions in this petition were substantially the same as
those previously made in the answer to the commission’s complaint. On January 4,
1926, the court rendered its decision affirming the order of the commission in its
entirety.
Hills Bros. petitioned the Supreme Court of the United States for certiorari. This
was denied, as was a subsequent petition for rehearing.
Chase & Sanborn case--Resale price maintenance--Coffee, etc.--This case involves
the adoption and use by the above company of a

LEGAL DIVISION

41

minimum resale price plan by and through which the company compelled dealers to
resell its products to the public at prices not less than certain arbitrary prices fixed by
it as the retail prices on their products.
The commission directed Chase & Sanborn to cease and desist from enforcing these
arbitrary resale prices and from informing dealers that persons or concerns not
maintaining said arbitrary resale prices so fixed by Chase & Sanborn had been or
would be cut off from supplies.
Petition for review was filed in the Circuit Court of Appeals for the First Circuit, and
on March 29, 1925, the court rendered its decision sustaining the commission’s order
in every respect.
Louis Leavitt--Misrepresentation of paint.--This respondent a manufacturer, sold
paint under the designation of “Gold seal combination white lead.” The commission
found that the paint contained not more than 3 per cent white lead, and that the term
“combination white lead “ is commonly understood and used by both the trade and the
public to designate a mixture of genuine white lead with other ingredients in which
mixture the white lead is not less than 50 per cent by weight. The commission directed
Leavitt to cease and desist from calling his product “Combination white lead” unless
it contained not less than 50 per cent white lead; and on April 26, 1926, entered a
modified order to cease and desist containing in substance the important features of
its original order. Leavitt petitioned the United States Circuit Court of Appeals,
Second Circuit, for a review of the order to cease and desist, and at the close of the
fiscal year the case awaits filing of briefs and argument.
Advance Paint Co.--Commercial bribery.--The commission issued an order to cease
and desist directing this corporation, engaged in the manufacture and sale of paints,
varnishes, and kindred products, to cease and desist from giving commodities such as
liquors, cigars, meals, theater tickets, entertainment, and money to employees of its
customers and prospective customers as an inducement to influence their employers
to purchase respondent’s paints and varnishes to the exclusion of respondent’s
competitors, a practice generally known as commercial bribery. Substantial evidence
having come to the attention of the commission that respondent was continuing the
practice of the payment of money prohibited by its order, the commission on October
17, 1925, petitioned the United States Circuit Court of Appeals, Seventh Circuit, for
enforcement of the order. Printed transcript of the record was filed with the petition.
During November and December, 1925, briefs were filed by both parties and the case
was argued on February 2, 1926, at which time the court, without written opinion,
dismissed the commission’s petition for enforcement

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

without prejudice to the commission’s right to enter a new order in the case, to
harmonize it with the decision of that court in the Kinney-Rome Co. case (275 Fed.
665), handed down subsequent to the entering by the commission of the abovementioned order to cease and desist. Petition for rehearing filed by the commission
was denied on March 9, 1926. Subsequently the commission modified its order to
conform to the decision of the court.
At the close of the fiscal year the case stands closed.
Ostermoor & Co. (Inc.) et al.--Misrepresentation--Mattresses.--This corporation and
one Edwin A. Ames, engaged in the business of manufacturing and selling bed
mattresses, were directed by the commission on February 15, 1926, after complaint
and hearings, to cease and desist from falsely representing pictorially and in advertising matter that their mattresses contain a greater number of superimposed layers of
cotton or felt and with a greater expansion or buoyancy than in fact is true. The
respondents petitioned the United States Circuit Court of Appeals, Second Circuit, for
review of the order to cease and desist.
At the close of the fiscal year the case was pending in that court.
Ajax Rope Co. (Inc.)--Misrepresentations--Rope.--This concern is engaged in the
purchase of rope and sale thereof to jobbers and dealers throughout the United States.
It was directed by the commission on October 30, 1923, to cease and desist from
misrepresenting that it is the maker or manufacturer of the rope in which it deals. It
appearing that this company was continuing to conduct its business in violation of said
order, an application for enforcement of same was filed by the commission on March
27, 1926, in the United States Circuit Court of Appeals, Second Circuit, where, at the
close of the fiscal year, the case was pending, awaiting briefs and argument. (The
company having changed its form of advertising so as to eliminate objections thereto,
and having agreed in future to adhere strictly to the terms of the order, the commission,
on September 20, 1926, approved a stipulation dismissing the application for
enforcement, without prejudice to a future proceeding, should the company, contrary
to the terms of the stipulation, violate the terms of the order. The matter will be
presented formally to the Court of Appeals on October 4, 1926.)
Standard Education Society case--Misrepresentations--Books.--This is a Minnesota
corporation, with headquarters at Chicago and engaged in the production and sale of
sets of books known as “The Standard Reference Work,” and also a loose-leaf service
called “The Standard Loose-Leaf Extension Service.” This concern was directed by
an order entered by the commission on November 10, 1923, to cease and desist from
(1) falsely representing and exaggerating the regular prices of said books, from which
it purported to give reduc-

LEGAL DIVISION

43

tions, (2) falsely representing that its products are bound in “rich maroon levant" or
other leather, (3) representing that its “Standard Reference Work” has been officially
adopted by 24 States, (4) offering prospective customers fictitious “honorary
membership” in the “Standard Education Society.”
It appearing that respondent persisted in its course of action prohibited by the order,
the commission, on May 27, 1926, filed in the United States Circuit Court of Appeals,
Seventh Circuit, its application for enforcement of the order to cease and desist.
The case was pending in that court at the close of the fiscal year, awaiting
respondent’s brief and argument.
Franklin Coal Co. case--Misrepresentations.--The Franklin Coal Co., a Missouri
corporation, is a distributer of coal in wholesale quantities to dealers, industrial plants,
and carload consumers throughout Illinois, Missouri, Arkansas, Iowa, and Wisconsin.
It was directed by the commission to cease and desist from designating and selling coal
produced from mines at certain points in Bond and Clinton Counties, Ill., as “Mount
Olive” coal and “Mount Olive district” coal, which phrases, according to the findings
of the com-mission, tend to mislead and deceive the public into the erroneous belief
that the coal was the well-known, high-quality coal produced for many years at Mount
Olive, Ill., and in a small district immediately contiguous thereto generally known as
the “Mount Olive district.”
The company, on March 23, 1926, petitioned the United States Circuit Court of
Appeals, Eighth Circuit, for a review of the commission’s order.
At the close of the fiscal year, the matter awaits the filing of briefs and argument.
Harriet Hubbard Ayer (Inc.) case--Resale price maintenance.--This corporation is
a manufacturer of cosmetics, against which, on October 7, 1925, the commission
issued an order requiring it to cease and desist from maintaining or carrying into effect
its policy of securing, on the part of its distributors and retailers, observance of resale
prices for its products by agreement, coercion, and cooperation in the fixing of resale
prices. On November 12, 1925, the respondent filed its petition in the United States
Circuit Court of Appeals, Second Circuit, for a review of the order to cease and desist.
The commission, on February 1, 1926, moved the court to direct that the petition be
made more definite and certain. After argument, this motion was granted, in part, and
thereafter, on February 18, 1926, an amended petition for review was filed by the
corporation.
At the close of the fiscal year the case awaits the filing of briefs and argument before
the Court of Appeals.

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

Cream of Wheat Co.--Resale-price maintenance case--Cereal.--This company, the
manufacturer of “Cream of Wheat,” was charged in complaint of the commission,
issued May 31, 1922, with fixing uniform prices at which “Cream of Wheat” should
be resold to the public by dealers and enforcing such fixed prices by combination and
cooperation with dealers in ascertaining and cutting off source of supply of price
cutters, all in alleged violation of section 5 of the Federal Trade Commission act. After
full hearing, the commission, on April 11, 1925, entered its order directing the company to cease and desist from carrying into effect its policy of securing the observance
of minimum resale prices for its product by cooperative methods in which the
company and its distributors, customers, and agents undertake to prevent others from
obtaining Cream of Wheat at less than the prices designated by it or from selling to
others who fail to observe such prices-(1) By seeking and securing, directly or through its sales agents, contracts,
agreements, or undertakings with customers or prospective customers that they will
maintain the resale prices designated by it, or that they will cooperate with it to secure
the observance by others of said resale prices;
(2) By the practice of (a) soliciting and securing from customers or prospective
customers themselves or from dealers or trade associations, information as to whether
or not such customers or prospective customers have maintained and are maintaining,
or are dis posed to maintain generally, resale prices fixed by producers, or, respondent’s resale prices in particular, and (b) soliciting and securing reports from
customers, of customers who fail to observe its resale prices, and investigating and
verifying such reports through further reports secured from customers as to such
instances of price cutting, all with a view to refusing further sales to customers found
to have cut its resale prices;
(3) By notifying other customers, in case of refusal by respondent of further sales
to price cutters, of such refusal and requiring them not to sell such price cutters on pain
of themselves being refused further sales
(4) By employing its sales agents to assist in such plan by reporting dealers who
have failed to observe its resale prices, and to secure adherence thereto from customers
or prospective customers, and furnishing said agents the names of customers to whom
it has refused further sales because of price cutting, and instructing them not to sell to
such customers.
(5) By requiring an extra price for its product from price cutters in order to secure
from them assurance of their future observance of its resale prices as a condition of
reinstatement on the regular basis; or

LEGAL DIVISION

45

(6) By utilizing any other equivalent cooperative means of accomplishing the
maintenance of prices fixed by respondent.
Appeal from this order was taken by the Cream of Wheat Co. to the United States
Circuit Court of Appeals for the Eighth Circuit. Thereafter the record and briefs were
filed in court and the case argued and submitted on June 7, 1926. At the close of the
fiscal year the court had not yet decided the matter but shortly thereafter on July 26,
1926, the opinion of the court was handed down affirming the order of the commission
in all respects, interpreting, however, paragraph 6 of the commission’s order by adding
the following proviso:
Provided, however, That nothing herein shall prevent the respondent from performing the
following acts:
(a) Requesting its customers not to resell Cream of Wheat at less than a stated minimum
price.
(b) Refusing to sell to a customer because he resells below such requested minimum price
or because of other reasons.
(c) Announcing In advance Its intention thus to refuse.
(d) Informing itself, through its soliciting agents and through publicly circulated
advertisements of customers which come to its attention, and through other legitimate means,
without any cooperative action with its other customers or other persons, as to the prices at
which Cream of Wheat is being sold.

CASES IN COURTS OF DISTRICT OF COLUMBIA
The Mannered Coal Co. case.--At about the same time that the steel companies were
asked by the commission to file monthly reports (as discussed in the section relating
to the Claire Furnace Co. case) substantially similar questionnaires were sent to
practically all corporations engaged in the production and sale in interstate commerce
of bituminous coal.
One of these companies, the Mannered Coal Co., declined to make the reports in
question and applied to the Supreme Court of the District of Columbia for an
injunction. A permanent injunction practically identical with that issued in the Claire
Furnace case was awarded.
The case was taken by the commission to the Court of Appeals for the District of
Columbia, where it was argued on January 9 and 10, 1924.
On May 10, 1924, the Court of Appeals directed a reargument. The case was reached
on the calendar October 10, 1924, and continued generally at that time pending a
decision by the Supreme Court of the United States in the Claire Furnace case.
At the close of the fiscal year it had not been reached.
Millers’ National Federation case--Investigation by commission in response to
resolution of the United States Senate. On February 16, 1924, the United States
Senate, by resolution, directed the com-

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

mission to investigate and report to the Senate, among other things, the extent and
methods of price fixing, price maintenance, and price discrimination, in the flour and
bread industries, developments in the direction of monopoly and concentration of
control, and all evidence indicating the existence of agreements, conspiracies, or
combinations in these industries. In the course of the investigation the commission
made inquiry with respect to the activities of the Millers’ National Federation, a
voluntary, unincorporated association, whose members produce approximately 65 per
cent of the flour milled in the United States, as well as of the activities of other milling
associations and corporations engaged in the milling industry. Permission was
requested of the Millers’ National Federation to inspect certain papers, documents, and
correspondence files, which permission was in part granted. As a result of the
inspection of certain correspondence, the commission requested the federation to
supply it with copies of certain designated letters, and further requested access, for the
purpose of inspection, to minutes of meetings among members of the federation and
other millers in various parts of the country and to letters passing between the
federation and its members leading up to the adoption of a so-called code of ethics by
the federation. The request was denied. The commission thereafter called a hearing
in the investigation at Chicago, Ill., and served subpoenas upon the secretary of the
federation requiring him to produce at the hearing certain letters specified by dates,
names of the parties correspondent, and subject matter, which its representative had
been permitted to inspect in the federation’s offices. Subpoenas were also served
requiring the production of minutes of the meetings among members of the federation
and other millers above mentioned (inspection of which had been denied) and of the
letters relating to the adoption of the code of ethics. The Washburn-Crosby Co., a
member of the federation and the largest milling corporation in the United States,
having also refused to permit the commission to inspect certain letters specified by
dates, names of parties correspondent, and subject matter, as well as having declined
to permit a statement of its business, made up from its books by representatives of the
commission, to be taken from its offices, subpoenas duces tecum were served upon
officers of the corporation requiring the production of the letters and of the statement,
at a hearing to be held at Minneapolis, Minn.
On the day prior to the hearing set for Chicago, Ill., the Millers National Federation,
on behalf of its members, filed a petition in the Supreme Court of the District of
Columbia, praying for a temporary restraining order and a temporary injunction
restraining the com-

LEGAL DIVISION

47

mission from taking any steps or instituting any proceedings to enforce the subpoenas
or requiring the plaintiffs, or any of them, to produce the documents or letters required
thereby. On the day of hearing set at Chicago, the secretary of the federation, the
officers of the Washburn-Crosby Co., and certain individuals connected with the
federation through membership therein of corporations in which they were officers,
did not appear as required by subpoenas; and on the morning of the same day a
temporary restraining order was issued by the Supreme Court of the District of
Columbia as prayed for in the petition. A motion for temporary injunction was
subsequently made. The commission answered the motion on the merits and moved
to dismiss the petition on various grounds, among others, that the court was without
jurisdiction to restrain the commission from proceeding with the hearing. Both motions
were argued and the case is pending awaiting the decision of the court thereon.
Pending the decision of the court, the commission has not taken further steps to
enforce its subpoenas. Subsequent to the close of the fiscal year, to wit, on September
22, 1926, the court handed down its opinion, sustaining in the main the contentions of
the Millers’ National Federation, and granting a temporary injunction.
DIVISION OF TRADE PRACTICE CONFERENCES
OUTLINE OF PROCEDURE

Outstanding among the activities of the commission during the year is the creation
of the division of trade practice conferences.
This division has taken over the trade practice conference work which heretofore has
been scattered among several divisions and has coordinated, expedited, and facilitated
the holding of such conferences with a view to encouraging closer cooperation
between business as a whole and the commission in serving the public, particularly by
extending the scope of this work within its proper sphere, by providing facilities for
prompter action than was heretofore attainable, and by supplying a means through
which immediate action may be taken in cases of alleged violation of rules adopted by
industries at trade practice conferences.
A trade practice conference, formerly known as a trade practice submittal, provides
a method of procedure whereby those engaged in an industry or business may
formulate, under the direction or sanction of the commission, their own rules of
business conduct. The origin of this procedure is found in an effort made several years
ago to eliminate simultaneously and by consent of those engaged in a given industry
practices which, in the opinion of the industry as a whole, were harmful, wasteful, or
unfair.

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

Prior to the beginning of the present fiscal year a number of successful conferences
have been held in the creamery, furniture, knit goods, typewriter, oil, jewelry, music,
book, printing, cotton, and other industries, and a pamphlet covering these has been
published and is available for public distribution.
This procedure has proven an expeditious and economical means of eliminating the
use of unfair methods of competition from in conference representatives of a given
industry who under the direction of the commission define and on a given date
voluntarily and simultaneously abandon the use of a such methods, thereby a putting
all competitors on an equal footing. In addition it induces moral support and actual
assistance from the industry in the enforcement of the rules which the industry adopts
and accomplishes at a minimum of cost and time one of the chief purposes for which
the commission was created.
Since the benefits of the trade practice conference procedure have become better
understood their development and growth made inevitable the formation of this new
division, and on April 19 last the following order was passed and made immediately
effective:
Ordered, That there be, and hereby is, created a division to be called the division of trade
practice conferences, the head of this division to be called the director of trade practice
conferences. There shall also be an assistant head called the assistant director, who shall assist
in the performance of the duties of the director, and who, in the absence of the director, shall
function as acting director. He shall have such other assistance as may be assigned him by the
commission.
The work of this division and the duties of the director shall be such as hereinafter are set
forth and as may be involved in the following modification of the procedure regarding trade
practice submittals or conferences:
1. Whenever the commission shall conclude that a trade practice submittal or conference is
desirable, or whenever an application for a trade practice submittal or conference shall came to
the commission, the same shall be referred to this division. Further, whenever it shall come to
the attention of, the chief counsel, the board of review, the chief examiner, or the chief trial
examiner that a trade practice, deemed to be unfair to competitors and/or prejudicial to the
public is prevalent in an industry, report of such fact shall be made forthwith to the commission
and be referred to this division.
2. Upon such reference the director shall make an investigation for the purpose of ascertaining
the extent of the practice in the industry and make a report direct to the commission together
with a recommendation as to the advisability of holding a conference or submittal.
3. Upon receipt of such report from the director, the commission shall deter mine whether a
trade practice conference (or submittal) shall be lucid and when a conference Is to be held, shall
order the director to arrange therefor.
4. Thereupon the director shall call such conference at a time and place to be determined upon
by him, shall give notice thereof to members of the industry, and shall preside over and conduct
such conference unless a commissioner shall be designated to so preside.

LEGAL DIVISION

49

5. The director shall make a report to the commission of the action taken at any such
conference with his recommendation for action of the commission thereof.
6. In addition, the director shall communicate or confer with as many members of the industry
as possible who were not represented at or who did not participate in such conference and
endeavor to procure their assent to and compliance with, the action taken by the conference and
approved by the commission.
7. The director shall, so far as practicable, keep informed as to how the action taken at the
conference and approved by the commission is being conformed to by the members of the
industry. He shall promptly investigate and report directly to the commission any violation
thereof, irrespective of whether the person violating the rules had subscribed thereto. The report
of the director showing such violation shall be the basis upon which the com mission may issue
its complaint.
8. The chief counsel, the board of review, the chief examiner, the docket section, and the
secretary to the commission shall, as promptly as practicable, convey to the commission all
information they may now have of the character covered by paragraph 1 hereof, to the end that
all applications for a trade practice conference (or submittal) now pending and all such
information as to matters pending before the commission may be referred to this division for the
procedure hereinabove outlined.
9. When the commission shall have determined its action in the matter of the conference or
submittal, the secretary shall notify the industry of the commission’s action, and also give the
action taken the widest publicity.
10. The secretary shall cause to be established and maintained in the docket section such
records and files as may be necessary in connection with this resolution.
11. At the conclusion of each such conference the heads of the several divisions shall report
to the commission the application of such conference to any matter in their charge together with
a recommendation.

The first trade practice conference was held in 1919. From that time to the beginning
of the present fiscal year 20 conferences have been held, or an average of
approximately three a year. The necessity for a more expeditious handling of this work
is illustrated by the fact that during its short existence applications for conferences
have reached this new division from 23 industries or lines of business, and, although
not yet fully organized, the status of these applications, as this report goes to press, is
as follows:
Conferences have been held for the watchcase, butter, eggs and poultry, and cheese
industries. An application for a conference with correspondence schools has been
disposed of by withdrawal. Preliminary investigation disclosed that conferences for
direct-selling companies, and master bookbinders and paper rulers are not feasible at
this time. Conferences for the fur industry and blanket industry have been ordered.
Actions on applications for conferences for the jewelry catalogue houses, steel, textile,
and lumber companies, manufacturers of mops, manufacturers of hat frames, cigars,
platinum alloys, wicker furniture, toys, drugs, and zinc product industries are awaiting
preliminary inquiry and report.

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

When a trade-practice conference is decided upon, a preliminary inquiry is made, the
result of which serves as a basis for determination by the director whether the practices
or methods used are unfair to competitors or are against the public interest, and
whether the interest of the public is best served by proceeding against individual
offenders or by calling a trade-practice conference. The commission is then advised
through this division as to the facts and laws, accompanied by a recommendation as
to action to be taken with reference thereto. If the commission determines on a trade
practice conference, the industry is assembled at a place and time specified, and when
the industry has adopted its rules a full report of the conference showing those present,
the proportion of the total industry which they represent, and other essential data is
presented to the commission; and if adopted or sanctioned by the commission, the
action of the industry becomes the rule of business conduct for that industry on the
subjects covered.
The findings by an industry condemning a given business practice are available to
the commission for use as evidence in any proceeding directed to an individual
member of the industry who fails or refuses to abide by the rules of conduct laid down
by the industry, and who indulges in practices condemned by the industry and by the
commission as unfair, and the division of trade practice conferences furnishes a means
whereby an agreement once entered into may be kept in effect and better attention
given to violations.
SUMMARY OF WORK, 192 6

Since the creation of the new division conferences were conducted for the retail
furniture trade, for manufacturers of Castile soap and mending cotton, for dealers in
eggs and poultry, and in connection with such commodities as “rayon,” “silkaline,”
butter, and cheese. Final action has been taken by the commission with reference to
four of these. Work in connection with other conferences had not been completed at
the close of the fiscal year.
The results of former trade practice submittals are embodied in the publication of the
commission entitled “Trade Practice Submittals,” released July 6, 1925.
Copies of public announcements in connection with conferences during the present
year will be found at pages 166 to 169.
METHODS OF COMPETITION CONDEMNED

The following list shows unfair methods of competition and Clayton Act violations
which have from time to time been condemned by the commission and prohibited by
orders to cease and desist:
Misbranding of fabrics and other commodities respecting the materials or ingredients of which
they are composed, their quality, origin, or source.

LEGAL DIVISION

51

Adulteration of commodities, misrepresenting them as pure or selling them under such names
and circumstances that the purchaser would be misled into believing them to be pure.
Bribery of buyers or other employee of customers and prospective customers to secure new
customers or induce continuation of patronage.
Making unduly large contributions of money to associations of customers.
Procuring the business or trade secrets of competitors hy espionage, by bribing their
employees, or by similar means.
Procuring breach of competitors’ contracts for the sale of products by misrepresentation or
by other means.
Inducing employees of competitors to violate their contracts or enticing away employees of
competitors in such numbers or under such circumstances as to hamper or embarrass them in
business.
Making false or disparaging statements respecting competitors products, their business,
financial credit, etc.
The use of false or misleading advertisements.
Making vague and indefinite threats of patent-infringement suits against the trade generally,
the threats being couched in such general language as not to convey a clear idea of the rights
alleged to be Infringed, but nevertheless causing uneasiness and fear in the trade.
Widespread threats to the trade of suits for patent infringement arising from the sale of alleged
infringing products of competitors, such threats not being made in good faith but for the purpose
of intimidating the trade.
False claims to patent, trade-mark, or other rights or misrepresenting the scope thereof;
appropriating and using trade-marks wrongfully.
Intimidation for the purpose of accomplishing en forced dealing by falsely charging disloyalty
to the Government.
Tampering with and misadjusting the machines sold by competitors for the purpose of
discrediting them with purchaser.
Trade boycotts or combinations of traders to prevent certain wholesale or retail dealers or
certain classes of such dealers from procuring goods or goods at the same terms accorded to the
boycotters or conspirators, or to coerce the trade policy of their competitors or of manufacturers
from whom they buy.
Passing off of products, facilities, or business of one manufacturer or dealer for those of
another by imitation of product, dress of goods, or by simulation or appropriation of advertising
or of corporate or trade names, or of places of business, and passing off by a manufacturer of
an inferior product for a superior product theretofore made, advertised, and sold by him.
Unauthorized appropriation of the results of a competitor’s ingenuity, labor, and expense,
thereby avoiding costs otherwise necessarily involved in production.
Preventing competitors from procuring advertising space in newspapers or periodicals by
misrepresenting their standing or other misrepresentation calculated to prejudice advertising
mediums against them.
Misrepresentation in the sale of stock of corporations.
Selling rebuilt machines of various descriptions, rebuilt automobile tires, and old motionpicture films slightly changed and renamed as and for new products.
Harassing competitors by requests, not in good faith, for estimates on bills of goods, for
catalogues, etc.
Giving away of goods in large quantities to hamper and embarrass small competitors, and
selling goods at cost to accomplish the same purpose.
Sales of goods at cost, coupled with statements misleading the public into the belief that they
are sold at a profit.

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

Bidding up the prices of raw materials to a point where the business is unprofitable for the
purpose of driving out financially weaker competitors.
The use by monopolistic concerns of concealed subsidiaries for carrying on their business,
such concerns being held out as not connected with the controlling company.
Intentional appropriation or converting to one’s own use of raw materials of competitors by
diverting shipments.
Giving and offering to give premiums of unequal value, the particular premiums received to
be determined by lot or chance, thus, in effect, setting up a lottery.
Schemes and devices for compelling wholesalers and retailers to maintain resale prices on
products fixed by the manufacturer.
Combinations of competitors to enhance prices, maintain prices, bring about substantial
uniformity in prices, or to divide territory or business, or to put a competitor out of business, or
to close a market to competitors.
Acquiring stock of another corporation or corporations where the effect may be to
substantially lessen competition, restrain commerce, or tend to create a monopoly.
Various schemes to create the impression in the mind of the prospective customer that he is
being offered an opportunity to make a purchase under unusually favorable conditions, when
such is not the case, such as
(1) Sales plans in which the seller’s usual price is falsely represented as a special reduced
price made available on some pretext, for a limited time or to a limited class only.
(2) The use of the “free” goods or service device to create the false impression that something
is actually being thrown in without charge when, as a matter of fact, fully covered by the amount
exacted in the transaction taken as a whole.
(3) Sales of goods in combination lots only with abnormally low figures assigned to staples,
the prices of which are well known, and correspondingly highly compensating prices assigned
to staples, the cost of which is not well known.
(4) Sale of ordinary commercial merchandise at usual prices and profits, as pretended
Government war surplus offered at a bargain.
(5) Use of misleading trade names calculated to create the impression that a dealer is a
manufacturer, selling directly to the consumer, with corresponding savings.
(6) Plans ostensibly based on chance, or services to be rendered by the prospective customer,
whereby he may be able to secure goods contracted for at particularly low prices, or without
completing all the payments undertaken by him, when as a matter of fact such plans are not
carried out as represented and are a mere lure to secure his business.
(7) Use of pretended exaggerated retail prices in connection with, or upon the containers of,
commodities intended to be sold as bargains at lower figures.
(8) Falsely claiming forced sale of stock, with resulting forced price concessions, when as a
matter of fact there is mingled with the customary stock inferior goods, and other methods are
employed so that as a matter of fact no such concessions are in fact accorded.
Seeking to cut off and hamper competitors in marketing their products through destroying or
removing their sales display and advertising mediums.
Discriminating in price, with the effect of substantially lessening competition. Subsidizing
public officials or employees through employing them or their relatives under such
circumstances as to enlist their interests in situations in

LEGAL DIVISION

53

which they will be called upon by virtue of their official position to act officially, making
unauthorized changes in proposed municipal bond issues, corrupting public officials or
employees and forging their signatures, and using numerous other grossly fraudulent, coercive,
and oppressive practices in dealing with small municipalities.
Suggesting to prospective customers the use of specific, unfair, and dis honorable practices
directed at competitors of the seller.
Imitating or using standard containers customarily associated in the mind of the general
purchasing public with standard weights of the product therein contained, to sell to said public
such commodity In weights less than the aforementioned standard weights.
Concealing business identity in connection with the marketing of one’s product, or
misrepresenting the seller’s relation to others, e g., claiming falsely to be the agent or employee
of some other concern, or failing to disclose the termination of such a relationship in soliciting
customers of such concern, etc.
Misrepresenting in various ways the advantages to the prospective customer of dealing with
the seller, such as-(1) Seller’s alleged advantages of location or size.
(2) False claims of being the authorized distributor of some concern.
(3) Alleged indorsement of the concern or product by the Government or by nationally
known businesses.
(4) False claim by a dealer in domestic products of being an importer, or by a dealer of being
a manufacturer, or by a manufacturer of some product of being also the manufacturer of the raw
material entering Into said product.
(5) False claim of “no extra charge for credit.”
(6) Of being manufacturers’ representative and outlet for surplus stock sold at a sacrifice, etc.
Tying or exclusive contracts, leases, or dealings, in which, in consideration of the granting of
certain rebates or refunds to the customer, or the right to use certain patented equipment, etc.,
the customer binds himself to deal only in the products of the seller or lessor,
Showing and selling prospective customers articles not conforming to those advertised, in
response to inquiries, without so stating.
Direct misrepresentation of the composition, nature, or qualities of the product offered and
sold.
Use by business concerns associated as trade organizations or otherwise of methods which
result or are calculated to result in the observance of uniform prices or practices for the products
dealt in by them with consequent restraint or elimination of competition, such as use of various
kinds of so-called standard cost systems, price lists or guides, exchange of trade information,
etc.
Securing business through undertakings not carried out and through dis honest and oppressive
devices calculated to entrap and coerce the customer or prospective customer, such as-(1) Securing prospective customer’s signature by deceit to a contract and promissory note
represented as simply an order on approval, securing agents to distribute the seller’s products
through promising to refund the money paid by them should the product prove unsatisfactory,
and through other undertakings not carried out
(2) Securing business by advertising a “free-trial” offer proposition, when as a matter of fact
only a “money-back” opportunity is offered the prospective customer, etc.

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

Giving products misleading names so as to give them a value to the purchasing public or to
a part thereof which they would not otherwise possess, such as
(1) Name implying falsely that the particular products so named were made for the
Government, or in accordance with its specifications, and of corresponding quality, or are
connected with it in some way, or in some way have been passed upon, inspected, underwritten,
or indorsed by it.
(2) That they are composed in whole or in part of ingredients or materials respectively
contained only to a limited extent or not at all.
(3) That they were made in or came from some locality famous for the quality of such
products.
(4) That they were made by some well and favorably known process,. when as a matter of
fact only made in imitation of and by a substitute for such process.
(5) That they have been inspected, passed, or approved after meeting the tests of some
official organization charged with the duty of making such tests expertly and disinterestedly or
giving such approval.
(6) That they were made under conditions or circumstances considered of importance by a
substantial fraction of the general purchasing public, etc.
Interfering with established methods of securing supplies in different businesses in order to
hamper or obstruct competitors in securing their supplies.

ECONOMIC DIVISION
The economic division is organized primarily to conduct general inquiries called for
by the President, by either house of Congress, or by the commission, under section 6
of the Federal Trade Commission act. This may be found on page 86 of this report.
This was to be the sole function of the commission according to the bill first prepared
for this purpose by the Committee on Interstate and Foreign Commerce in 1914, and
this bill was passed in that form by the House of Representatives. In other words, the
commission as first contemplated was to be a continuation of the Bureau of
Corporations and the original bill as well as the final law provided that it should take
over the personnel, records, and unfinished work of the said bureau. Hence the
economic division is practically a continuation of the Bureau of Corporations and has
had similar work, especially general inquiries relating to restraints of trade, monopolies, unfair business practices, business methods, and business organization. The
results of these inquiries have been published in printed reports, often with suggestions
of remedial legislation or for the constructive self-correction of abuses by the business
interests concerned.
During the fiscal year ended June 30, 1926, inquiries were conducted relating to the
following subjects:
Grain trade.--Inquiry initiated by the direction of the President and continued by the
commission.
National wealth and income.--Inquiry directed by Senate Resolution 451 (67th
Cong., 4th sess.), February 28, 1923.
Bread and flour industries.--Inquiry directed by Senate Resolution 163 (68th Cong.,
1st sess.), February 16, 1924.
Electric power industry.--Inquiry directed by Senate Resolution 329 (68th Cong., 2d
sess.), February 3, 1925.
Open price associations.--Inquiry directed by Senate Resolution 28 (69th Cong.,
special sess.), March 10, 1925.
Petroleum prices.--Inquiry directed by Senate Resolution 31 (69th Cong., 1st sess.),
June 3 1926.
Lumber trade associations.--Inquiry directed by the commission, January 4, 1926.
At the close of the year the first two inquiries had been completed; the report on
national wealth and income was submitted to the Senate on May 25, 1926, while the
report on the grain trade
55

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

was sent to the Congress and made public after the close of the fiscal year.
Just before the closing of the preceding fiscal year, on account of doubt as to the
construction of certain new limitations on the expenditure of its appropriation for the
fiscal years 1925-26, with respect to the inquiries then being conducted under the
direction of the Senate, the commission requested an opinion thereon by the Attorney
General. The opinion in this matter, which was favorable to the prosecution of the
work, was rendered on October 24, 1925. Pending the receipt of this opinion, work
was suspended on the inquiry into bread and flour, namely, from July 1, 1925, to
November 11, 1925. The initiation of the inquiry into open-price associations was
postponed to the latter date also. As there was no serious doubt regarding the electricpower inquiry, it was conducted without interruption. The legal questions involved in
this matter and some of the pertinent documents, including the opinion of the Attorney
General, were printed in the annual report for the preceding year.
NATIONAL WEALTH AND INCOME

Near the close of the fiscal year the commission issued a report on national wealth
and income. This report was made in response to Senate Resolution 451, adopted
February 28, 1923, which directed the commission to make an inquiry into and to
compile data concerning the total amount of the chief kinds of wealth in the United
States, the ownership thereof, and the encumbrances thereon, including both public
and private indebtedness, to determine for recent years the amount of the annual
increase in the wealth of this country in the various lines of economic activity and by
different classes of the population; and also to obtain information respecting the
amount and ownership of income exempt from Federal taxation and to report upon the
various phases of the inquiry as soon as practicable. An amendment to the resolution
instructed the com mission to ascertain the aggregate taxes levied by States, counties,
municipalities, and other taxing bodies for the last fiscal year and for the
corresponding period of five years previous.
On June 6, 1924, in partial response to this resolution, the com mission submitted
to the Senate a report on taxation and tax-exempt income. Work on the remaining
phases of the inquiry relating to wealth and income was brought to a hurried close on
June 30, 1925, on account of a new provision in the appropriation act for the fiscal
year 1925-26 which restricted the general purposes for which the appropriation could
be used.
The volume on national wealth and income is in two parts, one devoted to data on
wealth and the other to data on income.

ECONOMIC DIVISION

57

The national wealth is estimated in 1922 at 353 billion dollars and the national
income in 1923 at 70 billion dollars. The increase in national wealth from 1912 to
1922, as measured in dollars, is reckoned in the report at about 72 per cent, but if
allowance is made for changes in the purchasing power of the dollar the real increase
for the 10-year period was nearer 13 per cent as compared with about 15 per cent
increase in population. For the year 1922 the report estimates that the national wealth
consisted of 122 billions of land values, exclusive of improvements, or 35 per cent of
the total; 108 billions is the estimate for improvements on the land, and 123 billions
for movable goods of all kinds. Of the total real-estate value of 230 billions, about 42
billions is tax-exempt, and belongs chiefly to the government--Federal, State, and
local. The wealth of nonprofit institutions--religious, benevolent, and educational--is
estimated in the report at 14.5 billion dollars.
The report also estimates the amount of wealth according to various uses--wealth in
agriculture, for example, comprised about 18 per cent of the total, in manufacturing
and mining about 14 per cent, and in railroads and other public utilities about 13 per
cent. The largest share consists of dwellings and other goods used for personal
necessities and enjoyment--reckoned at over one-fourth of the total.
The wealth of corporations is developed in the report on the basis of special statistics
obtained from the Treasury Department, and an aggregate amount of 102 billion
dollars is shown for book values in 1922. Manufacturing corporations had the largest
amount, estimated at nearly 34 billion dollars, among which the producers of various
metals and metal products were the most important. The railroad corporations had a
greater amount of wealth than any other single industry and much the largest average
amount per company. The report states that the ownership of corporations, as shown
by the number of shareholders, is generally widely distributed. Returns from 4,367
corporations, with a combined capital stock of more than 9 billion dollars and an
aggregate of 1,074,851 holdings of common stock, give an average holding of common
stock of $6,969 and of preferred of $5,211. Excluding corporations, trustees, brokers,
and all foreign holders, over 90 per cent of the common stock was in the ‘lands of
individuals; corporations had only 1.1 per cent.
The discussion of national income consists of two main parts--first, an estimate of
the total national income by branches of economic activity, and second, a special
analysis of the income reported under the Federal income tax law. The amount of
income reported by the Treasury in its preliminary report on statistics of income for
1923 was 31 billion dollars, based on the returns of those persons

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

required to make reports. The total amount so reported was considerably less than onehalf of the estimated total income of the entire population. The population receiving
or participating in the enjoyment of this income was about one-sixth of the total of the
country. Three-fourths of this amount of income was reported by persons with less
than $10,000 income, and less than 4 per cent by persons with an income over
$100,000.
The income reported. in the income-tax returns is classified into several groups, such
as (1) wages and salaries; (2) business and partnership profits; (3) rents, royalties,
interest, and dividends; and (4) profits from the sale of real estate, stocks, and bonds,
etc. Of these, wages and salaries are the most important for the grand total of income
reported and constituted the bulk of income for persons having less than $10,000 a
year in 1920, 1921, and 1922.
The total national income is estimated for the years 1918 to 1923. The amount for
1923 was about 70 billion dollars, as already noted; the lowest amount was about 53
billion dollars in 1921, and the highest amount was about 75 billion dollars in 1920.
These marked variations are partly due to the marked fluctuations in prices, showing
changes in the value of the dollar. If dollars of more nearly equal purchasing power are
taken (using a cost of living index with 1923 as a basis), the 70-billion-dollar income
in 1923 should be compared with a 51-billion-dollar income in 1921 and 61 billion
dollars in 1920. While there was an increase in national income between 1918 and
1923, on either basis of comparison, of nearly 10 billion dollars, or about 15 per cent,
there was also an increase in population of about 6 per cent, which affects the net
increase in the income per capita. Of the estimated income in 1923 of 70 billion
dollars, 42 per cent is attributed to manufacturing, mining, and construction industries,
n early 14 per cent to agriculture, and about 12 per cent to merchandising. The division
of the total national income between labor and capital, before deducting any taxes
payable by either of them, is given as 55 per cent in wages and salaries and 45 per cent
in profits, rent, and interest for 1923. Labor’s proportion was lowest in 1918 and
capital’s proportion was lowest in 1921. These proportions are also shown for different
branches of industry, and varied very widely. Thus in agriculture the share going as
wages is quite small because most of the work is done by the farmer and his family,
but the share of wages and salaries in the railroad business was nearly 70 per cent in
1923, and in the construction industry it was over 90 per cent.
The report also analyzes the amount of corporation income as disclosed by the
income-tax returns from 1916 to 1923, which ranged from over 10 billion dollars profit
in 1917 to only a little

ECONOMIC DIVISION

59

more than a billion dollars in 1921. The rate of return of such corporation income, on
the “fair value” of the outstanding corporation capital stock as computed by the
Treasury, was 7.9 per cent in 1922, but varied widely among the various branches of
business.
In preparing this report the commission utilized the extensive and varied data
published by the Departments of the Treasury, Agriculture, and Commerce and
supplemented their data by such special inquiries as were seemed desirable in order
to develop the particular information required. Great care was exercised to prevent any
duplication of work.
GRAIN TRADE

The final volume of the commission’s report on the grain trade was completed and
sent to the Public Printer during the fiscal year.
This volume (Vol. VII) contains conclusions and recommendations referring to the
subject matter of the entire report, but especially such as relate to future trading
methods and practices. Various uses of the futures markets, especially hedging, are
described, and effects on prices of future trading in general, and of various types of
such trading, especially possibilities of manipulation, are considered. Facts regal ding
quantities of future trades made through the several classes of clearing-house members
for certain periods and of open trades are presented. Data for a large volume of
individual trades are subjected to statistical analysis with reference to the length of
time they are held open, the size of per bushel gains and losses, etc. The direct cost of
future trading (commissions, etc.) is estimated to amount to $20,000,000 a year or
more for the Chicago Board of Trade alone. Costs incidental to the use of futures
markets for gambling are believed to be very much more important.
The recommendations made take largely the form of suggestions intended to be
concretely formulated and put into effect by the exchanges, either of their own
initiative or through the exercise of the regulatory powers of the Secretary of
Agriculture. It is believed that, although it is impossible to prevent all unwise speculation, a duty rests upon the exchanges and upon their members to keep out incompetent
speculators so far as possible, as much because of the undesirable effects of their
presence upon the market as because of the generally unfortunate consequences of
their trading to themselves. Claims made on behalf of future trading that the practice
stabilizes prices are not regarded as substantiated. It is suggested that the market will
function better, and that especially there will be less meaningless price fluctuation, if
the various “technical” factors are reduced in importance through more defi15173---26-----5

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

nite and possibly stricter margin rules and related policies regarding credit
accommodation and through further emphasis upon the responsibility of the broker for
his customers’ methods of trading. Because of the character of the business it is
recommended that the financial stability of future commission houses be specially
safeguarded. The evil effect upon the market of trading in unduly large lots by wealthy
individuals or daring speculators should be dealt with directly, it is indicated, through
the machinery of the Grain Futures Administration of the Department of Agriculture.
The exchanges, and their members individually, it is believed, should be assisted to
establish such standards of business practice with regard to the general bearings of
future trading as will enable the public to forget that they are used so largely for mere
gambling.
ELECTRIC POWER

Senate Resolution 329 (68th Cong., 2d sess.), after alleging that the General Electric
Co. “has acquired a monopoly or exercises a control in restraint of trade or commerce
in violation of law of or over the production and distribution of electric energy and the
manufacture, sale, and distribution of electrical equipment and apparatus," directed the
commission to ascertain the facts and report to the Senate to what extent and by what
means the “General Electric Company or the stockholders or other security holders
thereof, * * * monopolize or control the production, generation, or transmission of
electric energy or power”; and also to report to the Senate the “manner in which the
said General Electric Company has acquired and maintained such monopoly or
exercises such control in restraint of trade or commerce and in violation of law.” The
resolution also directed the commission to “ascertain and report what effort, if any, has
been made by the said General Electric Company or other corporations, companies,
organizations, or associations., or anyone in its behalf, or in behalf of any trade
organization of which it is a member, through the expenditure of money or through the
control of the avenues of publicity, to influence or control public opinion on the
question of municipal or public ownership of the means by which power is developed
and electric energy is generated. and distributed.”
The first part of this inquiry was promptly initiated and a large part of the required
data collected and tabulated by the close of the fiscal year. In order to expedite the
inquiry it was divided into three parts, one a study of companies engaged in the
manufacture and sale of power-plant apparatus and equipment, another into the
electric-power industry, and the third an inquiry into conditions of competition among
manufacturers and distributors of power-plant

ECONOMIC DIVISION

61

equipment, and among concerns engaged in the generation, transmission, and sale of
electric energy. In order adequately to answer the Senate resolution on the subject of
control, a special study has been made of interlocking directors and of interlocking
stock ownership of all of the important manufacturers and distributors of power-plant
equipment, and also of each of the large groups engaged in the generation
transmission, and sale of electric power. This also required a very comprehensive
census of companies and large holding groups operating the private power plants,
transmission and distributing lines in order to determine the importance of particular
interrelations. This work has been made very difficult on account of the extensive
consolidations and interconnect ions which have occurred since the inquiry was
inaugurated.
The inquiry into that part of the resolution relating to the expenditure of money "or
through the control of the avenues of publicity, to influence or control public opinion
on the question of municipal or public ownership,” was not made in accordance with
the opinion of the Attorney General, referred to above, which held that under the
provisions of the appropriation act for the year 1925-26, none of the funds available
to the commission thereunder could be legally expended for this portion of the inquiry.
By the close of the fiscal year the field investigation was nearly completed and a
beginning made in the preparation of a draft report.
BREAD, FLOUR, AND GRAIN

By Senate Resolution 163 (68th Cong., 1st sess.), the commission was directed to
investigate the production, distribution, transportation, and sale of flour and bread; to
ascertain costs, prices, and profits at each stage of the process of production and
distribution from the time the wheat leaves the farm until the bread is delivered to the
consumer; and to inquire into developments in the direction. of monopoly and
concentration of control in the milling and baking industries, together with evidence
indicating violation of the antitrust laws.
This inquiry was divided into three parts for greater convenience in conducting it
These parts are grain marketing, flour milling and bread baking. A large part of the
investigatory work on the various parts of this whole inquiry was completed during the
fiscal year ending June 30, 1925. The work was in abeyance, however, from July to
November, 1925, awaiting an opinion from the Attorney General of the United States
as to whether further expenditures could be made in prosecuting this inquiry in view
of the restrictions in the appropriation act for the fiscal year ending June 30, 1926.
Grain marketing.--Great difficulty was experienced in obtaining cooperation from
certain grain marketers, namely, the larger line

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

and terminal grain-elevator companies, most of them refusing to permit agents of the
commission to secure the necessary data from their records. However, from the data
obtained directly by the commission and from other sources considerable information
as to the margins of grain-elevator companies was secured. as well as pertinent dat a
regarding marketing and transportation costs to central markets.
Flour milling.--On the flour-milling portion of the inquiry a preliminary report was
prepared in March, 1926. This report is incomplete, because certain large milling
companies refused to cooperate. In order to secure the information needed, subpoenas
were served in April, 1926, upon officers of the Millers’ National Federation and of
the Washburn-Crosby Co., calling for the production of certain definitely described
and specified papers relating to alleged violation of the antitrust acts. The Millers’
National Federation secured a restraining order on the commission on April 28, 1926,
in the Supreme Court of the District of Columbia. The power of Congress to authorize
the commission to use subpoenas in the course of a general investigation was deemed
and constitutes the most important issue. Final argument was heard on a motion for
a temporary injunction on June 24, 1926. On September 22, 1926, the court granted
a permanent restraining order against the commission, with respect to which the
commission has noted an appeal to the Court of Appeals of the District of Columbia.
On May 7, 1926, the commission sent the preliminary report on the flour-milling
industry to the Senate. The more important findings of the commission in this
preliminary report relate to activities to restrict competition but it contains also certain
summary data on costs and profits. The activities to restrict competition among flour
millers, as described in the report, relate chiefly to the following matters:
(1) Agreements, understandings, or cooperation to sell at a profit.
(2) Exchange of information on selling prices in order to prevent competitive price
cutting.
(3) Agreements, understandings, or cooperation to fix the elements of selling prices.
(4) Agreements, understandings, or cooperation to fix uniform differentials on prices
of flour sold in packages of different sizes or for flour in different containers. These
lists were prepared by a committee of the Millers’ National Federation and changed
from time to time.
(5) Agreements, understandings, or cooperation regarding forward delivery and
carrying charges.
The final conclusions of the commission with respect, to the flour industry were
reserved in the hope that the important documentary evidence called for by the
commission under subpoena, but which

ECONOMIC DIVISION

63

was refused by the millers, would be made available in time for the full report.
Bread.--In respect to bread, the inquiry was directed in part to a study of a
pronounced involvement in the consolidating of wholesale baking companies. This
movement has been in progress for more than 15 years, but recently it has assumed a
much greater significance. Attention was also given to methods of marketing bakery
products by wholesale companies and by “house-to-house” retail companies. This is
important in connection with the study of the Methods of competition prevailing in the
baking industry, which are also a subject of inquiry. Financial results have been
compiled for the principal wholesale baking companies for recent years showing ave
rage costs and prices per pound and average profits on investment. By the end of the
fiscal year the inquiry had been nearly completed and a draft report was partly
prepared.
OPEN PRICE ASSOCIATIONS

The inquiry into open price associations was instituted in response to Senate
Resolution 28 (69th Cong., special session) of March 11, 1925. On account of doubt
as to the commission’s authority to proceed under the terms of the appropriation act
for the fiscal year 1925-26, the inquiry into open price associations was not begun until
November, 1925, following the approval of the Attorney General.
Questionnaires were sent by the commission to several thousand trade associations
requesting them to report as to the various branches of activity in which they were
engaged and especially to indicate the characteristics of their statistical activities.
These schedules are being used as the basis for field work on open price associations
Work on other types of trade associations is limited to what is necessary in order to
elucidate the problems indicated in the Senate resolution The work to be done in the
field is extensive, but on account of shortage of funds it was necessary to proceed
slowly. An important feature of the inquiry is the study of the statistical work of open
price associations, including statistics of prices, production, stocks, etc. This involves
the analysis of the effects of open price activities upon prices by statistical methods,
including comparisons with other types of trade associations.
LUMBER TRADE ASSOCIATIONS

A few years ago, at the request of the Department of Justice, the commission
investigated several lumber trade associations. Reports regarding their activities
tending to restrain trade were transmitted to the Department of Justice, which made
supplemental investigations and instituted several suits for violation of the antitrust
laws against certain of these associations. On account of the decisions of the Supreme
Court in the Cement and Maple Flooring causes, these suits were dropped. On January
4, 1926, the commission directed

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

further inquiry into these associations for the purpose of bringing down to date
information with reference to their operations. Active field work was in progress at the
close of the year.
PETROLEUM PRICES

By Senate Resolution 31 (69th Cong., 1st sess.), adopted June 3, 1926, the
commission was directed to investigate and report to the Senate at the next session of
Congress: “ The very material advances recently made in the price of crude oil,
gasoline, kerosene, and other petroleum products and whether or not such price
increases were arbitrarily made and unwarranted; * * * whether or not there has been
any understanding or agreement between various oil companies or manipulations,
thereby to raise or depress prices or any conditions of ownership or control of oil
properties or of refining and marketing facilities in the industry which prevent
effective competition and “the profits of the principal companies engaged in the
producing, refining, and marketing of crude oil, gasoline, kerosene, and other
petroleum products during the years 1922, 1923, 1924, and 1925, and also such other
matters as may have bearing upon the subjects covered by the provisions of the
resolution.”
Work on this inquiry was started immediately, especially in pre paring schedules
calling for pertinent statistical and accounting data for producers, refiners, and
marketers of petroleum products.
COOPERATION WITH THE LEGAL STAFF

In the conduct of certain inquiries and proceedings in charge of the legal staff,
considerable assistance was furnished by the economic division through details of its
personnel. Among the more important instances were the Bethlehem-Lackawanna
Steel Merger case, the Utah-Idaho Sugar Co. case, the Continental Baking Co. case,
the Aluminum Co. of America case, the inquiry into alleged unlawful discriminations
against cooperative organizations of tobacco growers, directed by Senate Resolution
329 (68th Cong., 2d sess.), and the general inquiry into cooperative associations
directed by Senate Resolution 34 (69th Cong., special session).
COOPERATION WITH OTHER BRANCHES OF THE GOVERNMENT

A few instances members of the staff of the economic division were called upon by
other branches of the Government. Thus, a member of the staff was called upon by the
Department of Justice for testimony regarding the petroleum industry in United States
v. Standard Oil Co. et al., in the Patent Cross-Licensing case. Also, in connection with
certain hearings of Senate Committees on the Judiciary and of Interstate Commerce,
members of the staff were called and examined.

EXPORT TRADE DIVISION
EXPORT TRADE ACT
An “Act to promote export trade, and for other purposes,” was passed by Congress
on April 10, 1918, and administration thereof intrusted to the Federal Trade
Commission. (See p. 96.)
PROVISIONS OF’ THE LAW

This law, commonly know as the “Export trade act, or “ Webb Pomerene law,”
authorizes the formation of combinations or “associations” entered into for the sole
purpose of engaging in export trade and actually engaged solely in such export trade.
Exemption from the antitrust laws of the United States is granted to such an
organization, with the proviso that there shall not be restraint of trade within the
United States, or restraint of the export trade of any domestic competitor, nor shall the
association-either in the United States or elsewhere, enter into any agreement, under’ standing, or
conspiracy, or do any act which artificially or intentionally enhances or depresses prices within
the United States of commodities of the class exported by such association, or which
substantially lessens competition within the United States or otherwise restrains trade therein.

Under the law, such an association may be “ any corporation or combination, by
contract or otherwise, of two or more persons, partnerships, or corporations.” Export
trade is defined by the act as “ solely trade or commerce in goods, wares, or
merchandise exported, or in the course of being exported, from the United States or
any Territory thereof to any foreign nation.”
ASSOCIATIONS FILLING PAPERS DURING THE YEAR

Export associations organized during the fiscal year are the Salmon Export
Corporation, of Seattle, Wash.; the American Brake Beam Manufacturers’ Export
Association, of West Nyack, N. Y., and the California Dried Fruit Export Association,
of San Francisco, Calif. Several other concerns have such an organization under
consideration.
Fifty-one associations filed papers with the commission during the year:
American Brake Beam Manufacturers’ Export Association, West Nyack. Rockland County,
N. Y.
American Corn Products Export Association, New York City.

65

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

American Locomotive Sales Corporation, New York City.
American Milk Products Corporation, New York City.
American Paper Exports (Inc.), New York City.
American Pitch Pine Export Co., New Orleans, La.
American Provisions Export Co., Chicago, Ill.
American Soda Pulp Export Association, New York City.
American Spring Manufacturers’ Export Association, Pittsburgh, Pa.
American Surface Abrasives Export Corporation, New York City.
American Tire Manufacturers’ Export Association, New York City.
American Webbing Manufacturers’ Export Association, New York City.
Associated Button Exporters of America (Inc.), New York City.
Automatic Pearl Button Export Co. (Inc.), Muscatine, Iowa.
California Dried Fruit Export Association, San Francisco, Calif.
Cement Export Co., The, care of Morris Kind, Hercules Cement Corporation, Philadelphia,
Pa.
Chalmers (Harvey) & Son Export Corporation, Amsterdam, N. Y.
Copper Export Association (Inc.), New York City.
Davenport Pearl Button Export Co., Davenport, Iowa.
Delta Export Lumber Corporation, Memphis, Tenn.
Douglas Fir Exploitation & Export Co., Seattle, Wash.
Export Clothes Pin Association of America (Inc.), New York City.
Exporters of Wood Products (Inc.), New York City.
Florida Hard Rock Phosphate Export Association, Savannah, Ga.
Florida Pebble Phosphate Export Association, New York City.
Goodyear Tire & Rubber Export Co.; The, Akron, Ohio.
Grain Producers Export Association, The, New York City.
Grand Rapids Furniture Export Association, Grand Rapids, Mich.
Gulf Pitch Pine Export Association, New Orleans, La.
Hawkeye Pearl Button Export Co., Muscatine, Iowa.
Locomotive Export Association, New York City.
Naval Stores Export Corporation, New Orleans, La.
Pacific Flour Export Co., Portland, Oreg.
Pan American Trading Co., New York City.
Phosphate Export Association, New York City.
Pioneer Pearl Button Export Corporation, Poughkeepsie, N. Y.
Pipe Fittings & Valve Export Association, Branford, Conn.
Producers Linter Export Co., New Orleans, La.
Redwood Export Co., San Francisco, Calif.
Rubber Export Association, The, Akron, Ohio.
Salmon Export Corporation, Seattle, Wash.
Sugar Export Corporation, New York City.
Sulphur Export Corporation, New York City.
United Paint & Varnish Export Co., Cleveland, Ohio.
United States Alkali Export Association (Inc.), New York City.
United States Button Export Co., Muscatine, Iowa.
United States Handle Export Co., The, Piqua, Ohio.
United States Maize Products Export Association, The, Wilkes-Barre, Pa.
Walnut Export Sales Company (Inc.), Chicago, Ill.
Walworth International Co., Boston, Mass.
Wisconsin Canners Export Association, Manitowoc, Wis.
EXPORTS DURING 1925

Exports during 1925 by associations reporting to the commission totaled about

$165,500,000, an increase of $25,500,000 over exports.

EXPORT TRADE DIVISION

67

during the previous year, this in spite of the fact that in a good many instances prices
were lower in 1925.
Copper, cement, phosphate rock, crude sulphur, soda pulp, and alkali exported by
Webb law associations during 1925 totaled about 1,400,000 long tons, valued at
$57,000,000. Machinery, locomotives, railway equipment, pipe fittings, and valves
Were valued at about $4,000,000. Lumber (about 890,000 M feet of pine, fir, redwood,
gum-wood, oak, walnut, etc.), naval stores, and wood products totaled about
$38,000,000. Foodstuffs, including milk, meat, sugar, corn products, flour, and dried
fruit, totaled about 998,000,000 pounds, Val lied at $42,000,000. Paper, abrasives,
rubber goods, cotton, webbing, furniture, paint and varnish, buttons, clothespins, and
general merchandise amounts to about $24,5000,000.
Competition abroad is said to be very keen. The aggressive policy of European
manufacturers in increasing their export trade, the ability of German and Belgian
manufacturers to undersell in practically all markets, the lower labor costs and
increased capacity of mills in Japan and China, and a general tendency by foreign
countries to increase tariff rates are cited as handicaps which American exporters are
attempting to meet through cooperative selling.
Webb law associations have the advantage of economy in sales expense,
standardization of materials, uniformity in methods of packing, stamping, and handling
of shipping documents, and centralization of inquiries and orders which is conducive
to more prompt deliveries and better all-round service to customers. One association
reports that “Foreign business in any volume would be impossible without the
association.”
Trade promotions carried on through the united efforts of combining exporters. One
association reports that $30,000 was spent during 1925 for exploitation in foreign
markets, which expense was apportioned throughout the membership and was
therefore not a burden upon any one company.
Restriction of the practice of selling on consignment is said to have been a real
accomplishment of inestimable value in some industries. As reported by a lumber
company:
If our members were operating separately, they would also probably send consignments,
which is the curse of the export business and a wrecker of a stable market.

The quality of American products is being raised by export associations to an
increasingly high level. As stated by an association exporting food products:
We are striving to place the quality of goods in foreign markets that is second to none, and
the facilities allowed under the Webb Act will thus be directly instrumental in assisting
American manufacturers to retain and largely extend their foreign trade, despite heavy
competition.

15173---26-----6

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION
SECTION 6(H) OF THE FEDERAL TRADE COMMISSION ACT

Section 6(h) of the Federal Trade Commission act directs the commission to
investigate “trade conditions in and with foreign countries where associations,
combinations, o r practices of manufacturers, merchants, or traders, or other conditions
may affect the foreign trade of the United States.”
Under this section inquiries are conducted by the export trade division along the
lines of foreign commerce. Current information is gathered regarding trust laws,
combines, and unfair competition in foreign countries.
TRADE LEGISLATION IN FOREIGN COUNTRIES DURING THE LAST YEAR

The Norwegian law regarding the control of competition, restrictions, and abuse of
prices, passed by the Parliament on February 26, 1926, was approved by the King on
March 12, and will become effective on July 1, 1926. This act takes the place of the
provisional law of August 6, 1920, and provides for the establishment of a control
bureau and a control council. These authorities are empowered to require reports and
evidence regarding mergers of firms, binding or controlling agreements for the purpose
of regulating prices, production or marketing conditions, or other information of
sufficient importance to influence marketing conditions in Norway. For this purpose,
business books and papers may be demanded by the control authorities or confiscated
by the police if necessary. Industries are forbidden to fix or accept prices or
compensation that may be considered improper. The control council may prohibit the
fixing of minimum prices for further sale in cases where such prices. can be regarded
as causing an increase. A merger restricting competition may be ordered dissolved by
the control council if it is established that it exercises a harmful influence on price,
production, and marketing conditions in the country, or if its operating methods are
considered improper. The law forbids business boycotts which tend to prejudice public
interests, cause an unreasonable state of affairs, or appear unjust toward the boycotted
firm. It also prohibits contracts granting exclusive or preferential terms which tend to
prejudice the public interests or operate unfavorably toward other concerns. Appeal
from orders of the control council may be made to a board of appeals appointed by the
King, comprising five members, the chairman of which shall have the authority of a
supreme court judge.
On April 15, 1926, the German Reichstag passed a law providing for the
establishment of a “Committee for the investigation of German industrial and
commercial conditions,” which shall have very

EXPORT TRADE DIVISION

69

broad powers of inquiry. The committee will comprise from 29 to 35 members, of
which the Government shall appoint 11 members at the Reichstag’s proposal, 9
members at the proposal of the chairman of the provisional economic council, and 9
members in its own discretion. Special subcommittees will be appointed to study such
important problems as working hours credits taxes, and cartels. The powers of the
committee are subject to provisions of the German regulations for civil suits and
appeal from the committee’s decisions may be made to the federal economic court.
The International Union for the Protection of Industrial Property, formed by a
convention signed at Paris in 1883, modified at Brussels in 1900 and at Washington
in 1911, held meeting at the Hague on November 6, 1925, and revised the convention,
the new draft to be ratified by the signatory countries. The original convention was
signed by the United States of America, Germany, Austria-Hungary, Belgium, United
States of Brazil, Cuba, Denmark, Dominican Republic, Spain, France, Great Britain,
Italy, Japan, United States of Mexico, Norway, Netherlands, Republic of Portugal,
Serbia, Sweden, Switzerland, and Tunis. Canada, Greece, Syria, and Lebanon
afterwards joined the union. The proposed amendments will include revision of article
10 bis which previously read, “All the contracting parties agree to assure to the
members of the union all effective protection against unfair competition” and will now
be changed to read as follows:
The contracting countries are bound to assure to nationals of the union an effective protection
against unfair competition. Every act of competition contrary to honest practice In industrial
or commercial matters constitutes an act of unfair competition. The following particularly are
to be forbidden: (1) All acts whatsoever of a nature to create confusion, by no matter what
means, with the goods of a competitor; (2) false allegations, in the course of trade, of a nature
to discredit the goods of a competitor.

A new merchandise marks (imported goods) bill is pending in the British Parliament
which would provide for the marking of goods in such mu way that the consumer can
not fail to understand as to whether they are “home produce, empire goods, or foreign
merchandise.”
In Czechoslovakia an antitrust law has been drafted, which has been given
considerable attention within the past year by the Ministry of Justice and the Ministry
of Food Supplies. The Ministry of Commerce has also drawn up a bill against illicit
competition.
In New Zealand a dairy produce control board, similar to that in Australia, has been
established, which shall exercise control of sales of all dairy produce exploited to
Great Britain, Europe, and North America, as from August 1, 1926.

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

An important case was tried in New Zealand during the past year against firms
engaged in the manufacture, sale, and distribution of flour and by-products, under the
commercial trusts act of 1910. The Crown sought to show that by placing restrictions
upon the output of individual mills, by the partial elimination of the choice of brands
and qualities of flour available to users, by the production and forced sale at maximum
prices of flour of unsatisfactory quality, and by its operations, generally the trust was
of a harmful nature. The defense claimed that such activities were in their effect of
little detriment, and that compensating benefits must be considered. It was further
claimed that the unsatisfactory condition of the industry necessitated some such
combined action on the part of producing firms, and that had such action not been
taken, the industry would have suffered from ruinous competition. Decision in the
lower court was in favor of the defendants, but upon appeal to the supreme court this
action was reversed and the flour companies were fined £50 each. An injunction
against the continuance of the trust was held over pending an appeal to the privy
council.
An amendment has been proposed to the Constitution of Australia which would
empower the Parliament to make laws with respect to trusts, combinations, and
monopolies and would further provide for the acquisition and operation, under control
of the Common wealth, of any business which the Parliament may deem the subject
of monopoly.
FOREIGN TRADE COMPLAINTS

In the interest of the foreign commerce of this country, the Federal Trade
Commission investigates complaints against American importers and exporters which
may be reported by American consulates or trade offices in foreign countries,
chambers of commerce and other trade associations, or by private individuals. Such
investigations are made informally, without publicity, and the facts ascertained are
reported back to the foreign country through representatives of the United States
Departments of State and Commerce.
During the fiscal year ending June 30, 1926, 62 such complaints were handled, of
which 16 were still pending on July 1. These inquiries involved imports of walnuts
from Rumania, sheep sausage casings from India, cotton goods from Switzerland, reed
furnishings, china, soldering iron. and rubber goods from Germany; and exports of
hardware and umbrella sticks to Canada, picture slides to England, clothing and honey
to Sweden, rubber goods and sugar to France; leather, molasses, and musical
instruments to Greece; tin boxes to Italy, typewriters to Egypt, clothing to Cuba.
oranges to Peru, cartridges to Brazil, pianos to Argentina, toilet articles to

EXPORT TRADE DIVISION

71

the Philippines, radio supplies and clothing to New Zealand; electrical goods,
automobile parts, and flour to the Straits Settlements; oil engines to Japan, steel
products and wheat to China, and electrical supplies and movie films to India.
Complaints of this sort include allegations of defective quality, short shipments,
damage en route, delay or failure to deliver, and nonpayment or only partial payment.
In some cases the foreigner’s complaint is supplemented by inspection and report of
the American Consular officers abroad. There are two sides to every controversy, but
accurate facts ascertained by Government officials at both ends of the transaction often
serve as a very satisfactory basis for better understanding between American
companies and their foreign customers.
The following may be illustrative of at complaint against an American importer,
investigated during the past year: In December, 1923, a Rumanian shipped to the
United States a consignment of shelled walnuts to be sold on a commission basis,
according to contract with the American consignee. Shortly afterwards the American
concern went out of business and repeated inquiries from Rumania failed to result in
reply or a settlement of the account. Upon appeal to the American consulate in
Rumania and inquiry by the commission in this country, the bill of sale and other
records were located, and it was ascertained that a net amount of about $200 was due
the foreign complainant. Although the American company had retired from business,
its former president was located, and the commission’s inquiry resulted in a
satisfactory agreement between the disputing parties for payment of the balance due
The sum in this case was perhaps too small to warrant litigation, but the respondent’s
failure to settle or to reply to inquiries would have had a serious effect upon the
reputation of American tradesmen in the locality of the foreign complainant.
As an illustration of a complaint against an American exporter may be cited that of
a French company that ordered rubber goods to the amount of about $1,200, for which
payment was made in full in July, 1925. The goods, however, were not shipped and
the foreign. purchaser appealed to the United States Government for an inquiry into
the matter, with a somewhat bitter denouncement of the commercial reputation of
American traders in general and the respondent company in particular. Upon
investigation it was found that the American concern was a small company just
beginning business at the time that the order was placed. Further delay was caused by
the fact that it was necessary to secure special medallions or dies for making up the
merchandise. The complainant’s confidence was restored by the Government’s report
on the facts of the case, and

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

when the goods were finally shipped the foreigner’s ill will was appeased.
The efforts of the Government along this line have been commended by commercial
organizations in this country, and the foreign offices of the United States Department
of State report that the work is of great value in preventing ill will abroad and
promoting confidence in American goods and tradesmen.
THE LIAISON COMMITTEE

A representative of the Federal Trade Commission attends a bimonthly conference
of the liaison committee, composed of members from all offices and departments of
the United States Government that are concerned with foreign trade. Reports and
discussions serve to keep each office informed, to promote cooperation, and to prevent
duplication in the foreign-trade activities of the several departments.

ADMINISTRATIVE DIVISION
This division conducts the business affairs of the commission and is made up of
units usually found in Government establishments, the functions of the units being
governed largely by general statutes. These units are personnel, fiscal affairs,
publications, docket, mail and files, supplies, stenographic, and library. The units are
under the direct supervision of the chief of the administrative division, and the
character of work is indicated by the designation of the unit.
PERSONNEL

Under presidential commission dated September 18, 1925, Mr. Charles W. Hunt, of
Iowa, was given a recess appointment as commissioner, succeeding himself, effective
September 26, 1925, under which appointment he took oath of office September 23,
1925. On December 16; 1925, the Senate received the President’s nomination of Mr.
Hunt as commissioner for a term expiring September 25, 1932. He was confirmed
March 10, 1926 (legislative day of March 9, 1926). Under this commission he took
oath of office March 16, 1926.
In accordance with the usual practice of selection by rotation, Mr. Nugent became
chairman of the commission on December 1, 1925, to serve for one year, succeeding
Mr. Van Fleet. At the same time Mr. Hunt was chosen vice chairman.
On June 30, 1926, the total personnel numbered 312-a figure which has been
practically stationary for the past six years. Of these 178 were under civil service, and
134 held excepted position. The salary roll totaled $871,060. The provisions of the
retirement law applied to 200 employees. Of the total number of employees 164 were
engaged in executive and administrative work, 91 were attorneys, 29 were economists,
and 28 were accountants. There were 95 women employees. During the year 38
employees, or 12 per cent, left the service, and 41 new employees entered upon duty.
A statement of the personnel, including commissioners, at the end of each fiscal year
since the organization of the commission is given below :
June 30, 1915
June 30, 1916
June 30, 1917
June 30, 1918
June 30, 1919
June 30, 1920

143
224
214
663
376
418

June 30, 1921
June 30, 1922
June 30, 1923
June 30, 1924
June 30, 1925
June 30, 1926

315
318
308
314
314
317

73

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION
PUBLICATIONS

The following publications, were issued during the year:
Annual Report for the Fiscal Year ended June 30, 1925, December 10, 1925: 257 pages.
Premium Prices of Anthracite, July 6, 1925; 97 pages
Trade Practice Conferences, July 6, 1925; 64 pages.
Report on the degree of concentration in the ownership, etc., by the American Tobacco Co.
and the Imperial Tobacco Co.; and also the relation of these companies to tobacco cooperative
associations. This report was prepared In response to Senate Resolution 329 (68th Cong., 2d
sess.) and is dated December 23, 1925; 129 pages (printed as S. Doc. No.34, 69th Cong., 1st
sess.).
Decisions, Findings, and Orders of the Federal Trade Commission, Volume VII (November
5, 1923, to July 20, 1924), June 30, 1926; 641 pages.
Preliminary Report on Flour Milling Industry (in response to S. Res. 163, 68th Cong., 1st
sess.), May 7, 1926; 148 pages.
National Wealth and Income (In response to S. Res. 45, 67th Cong., 4th sess., printed as S.
Doc. 126), May 25, 1926; 381 pages.
Grain Trade, Volume VII, Effects of Future Trading, June 25, 1926; 419 pages.

Copies of these publications may be purchased from the Superintendent of
Documents, Washington, D. C., for nominal sums. During the fiscal year ended June
30, 1925, 3,614 copies of reports of the commission were sold by the Superintendent
of Documents for $1,451.40. The figures for the fiscal year 1926 are not yet available.
DOCKET

In this section are kept the documents and records pertaining to the legal work of the
commission. See pages 78 to 81 for statistical tables.
LIBRARY

The library has a collection of over 20,000 books, pamphlets, and bound periodicals,
devoted largely to the subjects of law, economics, and industries. In addition are
extensive files of clippings, leaflets, etc. The distinctive features of the economic
collection are the files relating to corporation and trade-association data and files of
trade periodicals for the more important industries. There is a function peculiar to the
commission’s library in the character of work it performs, and that is in the material.
it gathers in the form of pamphlets, corporation reports, association records, current
financial and statistical services, catalogues, and trade lists, which are not ordinarily
found in libraries of even a technical character. The greater amount is furnished
gratuitously. This material. furnishes a valuable adjunct to the investigatory work and
is adapted to furnish leads to examinations rather than to complete and substantive
information on the subject matter.

ADMINISTRATIVE DIVISION

75

QUARTERS

The commission is housed in one of the temporary war structures at Twentieth and
D Streets NW., and by reason of its location and condition of the building is seriously
handicapped in its work. To facilitate trial and investigatory work and in the interest
of economy, small branch offices are maintained at New York City, Chicago, San
Francisco, and Seattle.
FISCAL AFFAIRS

Appropriations available to the commission for the fiscal year ended June 30, 1926,
under the executive and sundry civil act, approved March 3, 1925, amounted to
$1,008,000. This sum was made up of three separate items : (1) $50,000 for salaries
of the commissioners, (2) $940,000 for the general work of the commission, and (3)
$18,000 for printing, and binding.
Expenditures and liabilities for the year amounted to $994,957.02, which leaves a
balance of $13,042.98. This represents the balance in the lump-sum appropriation.
The appropriations, expenditures, liabilities, and balances are tabulated as follows:
Appropriations, expenditures, liabilities, and balances

Amount
available

Amount
expended

Liabilities

Expenditures and

Balances
liabilities
Federal Trade Commission, 1926:
Salaries, commissioners
$50,000.00
Printing and binding
18,000.00
All other authorized expenses 940,000.00
$13,012.98
Total, fiscal year 1926 1,008,000.00
13,042.98
Unexpended balances:
1925
1,805.25
1924
33,010.44
1923
1,876.33
Total
49,735.00

$50,000.00
12,678.85 $5,121.15
906,283.01 20,673.96

$50,000.00
18,000.01
926,957.02

968,961.91 25,995.11

994,957.02

13,519.33

11,714.08

33,008.24

Cr. 2.20

1,874.08

Cr. 2.25

1,056,401.65

980,671.54

Statement of costs for the fiscal year ended June 30, 1926

Administrative
$266,784.39
Economic
231,796.41
Legal:
Chief counsel
212,948.96
Chief examiner
203,603.50
Board of review
29,707.41
Export trade
14,224.63
Trial examiners
26,998.71
Trade practice conference
1,958.95
Grand total
988,022.96

Office
$266,784.39
217,196.06

177,720.54
175,526.38
29,675.91
12,336.25
22,985.33
1,766.95
903,991.81

Field

Total

$14,600.35

35,228.42
28,077.12
31.50
1,888.38
4,014.38
192.60
84,031.18

76

ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION
Detailed statement of costs for the fiscal year ended June 30, 1926

Item
Annual leave
Applications for complaints
Board of review
Bread inquiries
Briefs
Clayton Act, section 7, general investigation
Communications
Complaints, formal
Computing-machine work
Cooperative associations
Court costs
Court leave
Docket section
Drafting complaints
Economic supervision
Electric-power Industry
Equipment
Export trade
Fiscal affairs
General administration, commissioners, etc
Grain and produce changes
Heat and light
Injunction proceedings against the commission
Labor
Legal supervision
Library section
Lumber trade associations
Mail and file section
Medical attendant
Messengers
Military leave
Miscellaneous economic
Miscellaneous legal
National wealth inquiry
Open price associations
Personnel section
Petroleum prices
Preliminary inquiries
Printing and binding
Publication section
Purchases and supplies section
Rents
Repairs
Sick leave
Special briefs
Special legal work for the commissioners
Stenographic
Stipulations
Study of procedure
Supplies
Time excused by the Executive or commission’s order
Tobacco inquiry
Trade practice conference
Trade practice submittal
Transportation of things
Travel expense, Washington (D. C.) car tokens
Witness fees
Total office expenses
Total cost

Office
$69,135.81
44,686.06
26,575.98
31,292.68
32.76

Field
$11,307.94
4,116.84
90.82

3,742.57
161,510.76
1,203.74
3,996.96
677.12
67.44
18,309.88
4,977.36
18,543.71
105,021.91
8,535.12
10,496.93
10,950.32
77,083.84
16,940.48
101.95
14.17
3,135.01
56,072.49
7,777.93
46.15
10,552.30
1,413.92
10,839.45
881.40
453.80
5.41
11,609.21
9,501.63
45.69
32,285.05
16,436.84
15,826.78
5,412.60
11,012.51
157.82
21,401.95
75.54
278.82
52,995.29
2,569.44
26.05
10,046.49
2,728.37
2,739.18
1,555.26
53.24
323.34
80.00
1,345.50
903,991.81

46,618.77
1,011.76

9,946.49
1,888.38

914.25
83.25

8.02
712.21

6,512.60

177.50

493.84
96.12
52.56

84,031.15
903,991.81
988,022.96

Adjustments.--The following adjustments are made to account for the difference

between costs and expenditures:
Total cost for the year ended June 30, 1926
Less transportation issued
New total
Plus transportation paid
Expenditures for the year ended June 30, 1926

$988,022.06
33,942.33
954,080.63
26,590.91
980,671.54

ADMINISTRATIVE DIVISION

77

Appropriations available to the commission Since its organization and the
expenditures for the same period, together with the unexpended balances, are shown
in the following table:
Year
1915
1916
1917
1918
156,678.60
1919
231,198.80
1920
1921
1922
1923
1924
1925
1,805.25
1926

Appropriations

Expenditures

Balance

$184,016.23
430,964.08
567,025.92
1,608,865.92

$90,442.05
379,927.41
472,501.20
1,452,187.32

$93,574.18
51,036.67
94,524.72

1,753,530.75

1,522,331.95

1,305,708.82
1,032,005.67
1,026,150.54
974,480.32
1,010,000.00
1,010,000.00

1,120,301.32
938,664.69
956,632.01
970,746.28
977,018.28
1,008,194.75

185,407.50
93,340.98
69,518.53
3,734.04
32,981.67

1,008,000.00

994,395.73

13,604.27

TABLES SUMMARIZING WORK OF LEGAL DIVISIONS AND COURT
PROCEEDINGS, 1915-1926
TABLE 1.--Preliminary investigations
1915 1916 1917 1918 1919 1920 1921 1922 1923 1924 1925 1926
Pending beginning of
year
0
4
12
32
19
29
61
68 182 181 234 186
Request for action
from public
119 265 462 611 843 1,107 1,070 1,258 1,313 1,584 1,623 1,535
Total for disposition119 269 474 643 862 1,136 1,131 1,326 1,495 1,765 1,857 1,721
Dismissed after
investigation
3
123 289 292 298 351 500 731 931 1,209 1,215 1,121
Docketed as applications
for complaints 112 134 153 332 535 724 563 413 383 322 456 286
Total disposition during
year
115 257 442 624 833 1,075 1,063 1,144 1,314 1,531 1,671 1,407
Pending end of year 4
12
32
19
29
61
68 182 181 234 186 314

SUMMARY

Instituted to June 30, 1926 inclusive
Dismissed after investigation
Docketed as applications for complaint
Total disposition to June 30, 1926
Pending July 1, 1926, inclusive

11,790
7,063
4,413
11,476
314

TABLE 2.--Applications for complaint
1915 1916 1917 1918 1919 1920 1921 1922 1923 1924 1925 1926
Pending beginning of
year
0
104 130 188 280 389 554 467 458 572 565 488
Docketed during year 112 134 153 332 535 724 426 382 416 377 340 273
Closed for other reasons0
0
0
0
0
0
0
6
6
5
4
5
Total for disposition 112 238 283 520 815 1,113 980 855 880 954 909 766
Dismissed during year 8
105
79 160 301 339 357 293 187 246 299 186
Disposed by stipulation
during year
0
0
0
0
0
0
0
0
0
0
4 102
To complaints during year 0
3
16
80 125 220 156 104 121 143 118
56
Total disposition during
year
8
108
95 240 426 559 513 397 308 389 421 344
Pending end of year
104 130 188 280 389 554 467 458 572 565 488 422

SUMMARY

Docketed to June 30, 1926, inclusive
Dismissed (net)
Disposed of by stipulation
To complaints

4,204
2,534
106
1,142

Total disposition to June 30, 1926, inclusive
Pending July 1, 1926
78

3,782
422

79

TABLES SUMMARIZING WORK, 1915-1926
TABLE 3.--Complaints

1915 1916 1917 1918 1919 1920 1921 1922 1923 1924 1925 1926
Pending at beginning of year 0
0
5
10
86
133
287
312
257
232
264
220
Docketed during
year
0
5
9
154
135
308
177
111
144
154
132
62
Previous dismissals rescinded 0
0
0
0
0
0
1
0
1
1
0
0
Previous orders to
cease and desist
rescinded
0
0
0
0
0
0
0
0
0
5
0
0
Total for disposition
0
5
14
164
221
441
455
423
402
392
390
282
Dismissed during
year
0
0
1
7
13
44
37
75
88
36
103
86
Orders to cease and
desist entered
during year
0
0
3
71
75
110
116
91
82
92
73
44
Total disposition
during year
0
0
4
78
88
154
153
166
170
128
176
130
Pending at end
of year
0
5
10
86
133
217
312
257
232
264
220
152
SUMMARY
Docketed to June 30, 1928, inclusive
Dismissed (net)
Order to cease and desist (net)
Total disposition to June 30, 1926, inclusive
Pending July 1, 1926

1,391
487
752
1,289
152

COURT PROCEEDINGS--ORDERS TO CEASE AND DESIST
TABLE 4.--Petitions for review--United States Circuit Courts of Appeals

Pending at beginning of year
Appealed during year
Total for disposition
Decisions for commission
Decisions against commission
Petitions withdrawn
Total disposition during year
Pending at end of year

0
4
4
1
1
0
2
2

1919 1920 1921 1922 1923 1924 1925 1926
2
8
13
9
4
14
9
18
5
5
15
6
11
26
18
14
19
20
0
1
4
5
1
6
3
11
5
4
4
3
0
1
0
1
0
2
3
13
9
10
5
11
8
13
9
4
14
9

9
5
14
5
1
0
8
8

SUMMARY
Appealed to June 30, 1920, inclusive
Decisions for commission
Decisions against commission
Petitions with drawn
Total disposition to June 30.1926, inclusive
Pending July 1, 1926

67
23
32
4
59
8

TABLE 5.--Petitions for review--Supreme Court or the United States

Pending at beginning of year
Appealed by commission
Appealed by others
Total for disposition
Decisions for commission
Decision against commission
Petitions withdrawn by commission
Writ denied commission

0
0
0
0
0
0
0
0

1919 1920 1921 1922 1923
0
1
3
2
2
4
0
0
0
2
3
7
0
0
2
1
0
0
0
0
0
0
0
2

1921 1925 1926
3
1
5
0
2
1
10
2
0
20
5
1
1
0
1
0

0
5

4
2
1
6
0
0

0
l

3
9
0
0
0
2

Writ denied others
Total dis position during year
Pending at end of year

0
0

0
1

0

0
0

1

0
4

3

2
9

3

1
2

1

1
2

0

1
3

4

6

80

ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION
SUMMARY

Appealed by commission to June 80, 1926, inclusive
Appealed by others to June 30, 1926, inclusive
Total appealed to June 30, 1926, inclusive
Decisions for commission
Decisions against commission
Petitions withdrawn by commission
Writ denied commission
Writ denied others
Total disposition to June 30, 1926, inclusive
Pending July 1, 1926

20
7
27
2
7
1
6
5
21
6

TABLE 6.--Petitions for enforcement--Lower courts

Pending at beginning of year
Appealed during year
Total for disposition
Decisions for commission
Decisions against commission
Petitions by commission denied
Total disposition during year
Pending at end of year

0
0
0
0
0
0
0
0

1919 1920 1921 1922 1923 1924 1925
0
0
0
0
1
0
0
0
1
0
0
0
1
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
1

1926
3
2
3
0

1
1
4
2

3
4
0

2

0

1
0
3

1
3
1

1
3

SUMMARY
Appealed to June 30,1926, inclusive
Decisions for commission
Decisions against commission
Petitions denied
Total disposition to June 30, 1926, inclusive
Pending July 1,1926

7
2
0
2
4
3

TABLE 7.--Petitions for enforcement--Supreme Court of the United States

Pending at beginning of year
Appealed by commission
Appealed by others
Total for disposition
Total disposition during year
Pending at end of year

0
0
0
0
0
0

1919 1920 1921 1922 1923 1924 1925 1926
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0

0
1
1
2
0
2

SUMMARY
Appealed to June 30, 1926, inclusive
Total disposition to June 30, 1926, inclusive
Pending July 1,1925

2
0
2

TABLE 8.--Petitions for rehearing, modification, etc.--Lower courts

Pending beginning of year
Appealed during year
Total or disposition
Decisions or commission
Decisions against commission
Petitions by commission denied
Petitions by others denied
Petitions withdrawn by commission
Total disposition during year
Pending at end or year

0
0
0
0
0
0
0
0
0
0

1919 1920 1121 1922 1923 1924 1925 1926
0
1
0
1
0
0
1
0
3
0
2
9
1
1
3
1
2
9
0
0
1
0
0
1
0
0
0
0
0
1
0
1
0
0
2
1
0
0
1
1
0
3
0
0
0
0
0
1
0
1
2
1
2
7
1
0
1
0
0
2

2
3
5
0
0
2
2
0
4
1

81

TABLES SUMMARIZING WORK, 1915-1926
SUMMARY
Appealed to June 30, 1926, inclusive
Decisions for commission
Decisions against commission
Petitions by commission denied
Petitions by others denied
Petition withdrawn by commission
Total disposition to June 30, 1926, inclusive
Pending July 1, 1920

18
2
1
6
7
1
17
1

TABLE 9.--Petitions for rehearing, modification, etc.--Supreme Court of the United States

Pending beginning or year
Appealed during year
Total for disposition
Petitions denied others
Total disposition during year
Pending at end of year

0
0
0
0
0
0

1919 1920 1921 1922 1923 1924 1925 1926
0
0
0
0
0
0
0
1
0
0
0
0
1
0
0
0
0
1
0
0
0
0
1
0
0
0
0
0
0
0

0
0
0
0
0
0

0
1
1
1
1
0

SUMMARY
Appealed to June 30 1920 inclusive
Petitions by others denied
Total disposition to June 30, 1926, inclusive
Pending July 1, 1926

2
2
2
0

COURT PROCEEDINGS--MISCELLANEOUS
TABLE 10.--Mandamus, injunct ion, etc.--Lower courts

Pending at beginning of year
Appealed during year
Total for disposition
Decisions for commission
Decisions against com mission
Petitions withdrawn by others
Total disposition during year
Pending at end of year

0
1
1
0
0
0
0
1

1919 1920 1921 1922 1923 1924 1925 1926
1
2
8
4
1
1
2
2
5
4
0
0
3
4
8
8
1
1
0
1
2
0
0
0
1
0
1
7
0
0
0
0
1
0
0
0
1
1
4
7
0
0
2
3
4
1
1
1
SUMMARY

Appealed to June 30, 1926, inclusive
Decisions for commission
Decisions against commission
Petitions withdrawn by others
Total disposition to June 30, 1926, inclusive
Pending July 1,1926

15
3
9
1
13
2

TABLE 11.--Mandamus, injunction, etc.--Supreme Court of the United States

Pending at beginning of year
Appealed during year
Total for disposition
Decisions for commission
Decisions against commission
Total disposition during year
Pending at end of year

0
0
0
0
0
0
0

1919 1920 1921 1922 1923 1924 1925 1926
0
0
0
0
6
4
0
0
0
6
0
0
0
0
0
6
6
4
0
0
0
0
0
0
0
0
0
0
2
3
0
0
0
0
2
3
0
0
0
6
4
1
SUMMARY

Appealed to June 30, 1926, inclusive
Decisions for commission
Decisions against commission

6
0
5

1
0
1
0
0
0
1

1
1
2
0
0
0
0
2

Total disposition to June 30,1926, inclusive
Pending July 1, 1926

5
1

EXHIBITS
83

EXHIBIT 2.
FEDERAL TRADE COMMISSION ACT.
AN ACT To create a Federal Trade Commission, to define its powers and duties, and
for other purposes.
Be it enacted by the Senate and House of Representatives of the United States of America in
Congress assembled, That a commission Is hereby created and established, to be known as the
Federal Trade Commission (hereinafter referred to as the commission), which shall be composed
of five commissioners, who shall be appointed by the President, by and with the advice and
consent of the Senate. Not more than three of the commissioners shall be members of the same
political party. The first commissioners appointed shall continue in office for terms of three,
four, five, six, and seven years, respectively, from the late of the taking effect of this act, the
term of each to be designated by the President, but their successors shall be appointed for terms
of seven years, except that any person chosen to fill a vacancy shall be appointed only for the
unexpired term of the commissioner whom he shall succeed. The commission shall choose a
chairman from its own membership. No commissioner shall engage In any other business,
vocation, or employment. Any commissioner may be removed by the President for inefficiency,
neglect of duty, or malfeasance in office. A vacancy in the commission shall not impair the right
of the remaining commissioners to exercise all the powers of the commission.
The commission shall have an official seal, which shall be judicially noticed.
SEC. 2. That each commissioner shall receive a salary of $10,000 a year, payable in the same
manner as the salaries of the judges of the courts of the United States. The commission shall
appoint a secretary, who shall receive a salary of $5,000 a year, payable in like manner, and it
shall have authority to employ and fix the compensation of such attorneys, special experts,
examiners, clerks, and other employees as it may from time to time find necessary for the proper
performance of its duties and as may be from time to time appropriated for by Congress.
With the exception of the secretary, a clerk to each commissioner, the attorneys, and such
special experts and examiners as the commission may from time to time find necessary for the
conduct of its work, all employees of the commission shall be a part of the classified civil
service, and shall enter the service under such rules and regulations as may be prescribed by the
commission and by the Civil Service Commission.
All of the expenses of the commission, including, all necessary expenses for transportation
incurred by the commissioners or by their employees under their orders, in making any
investigation, or upon official business in any other places than in the city of Washington, shall
be allowed and paid on the presentation of itemized vouchers therefor approved by the
commission.
Until otherwise provided by law, the commission may rent suitable offices for Its use.
The Auditor for the State and Other Departments shall receive and examine all accounts of
expenditures of the commission.
SEC. 3. That upon the organization of the commission and election of its chairman, the
Bureau of Corporations and the offices of Commissioner and Deputy Commissioner of
Corporations shall cease to exist; and all pending Investigations and proceedings of the Bureau
of Corporations shall be continued by the commission.
All clerks and employees of the said bureau shall be transferred to and become clerks and

employees of the commission at their present grades and salaries. All records, papers, and
property of the said bureau shall become records, papers, and property of the commission, and
all unexpended funds and appropriations for the use and maintenance of the said bureau,
including any allotment already made to it by the Secretary of Commerce from the contingent
86

FEDERAL TRADE COMMISSION ACT

87

appropriation for the Department of Commerce for the fiscal year nineteen hundred and fifteen,
or from the departmental printing fund for the fiscal year nineteen hundred and fifteen, shall
become funds and appropriations available to be expended by the commission in the exercise
of the powers, authority, and duties conferred on it by this act. The principal office of the
commission shall be in the city of Washington, but it may meet and exercise all its powers at any
other place. The commission may, by one or more of its members, or by such examiners as it
may designate, prosecute any inquiry necessary to its duties in any part of the United States.
SEC. 4. That the words defined in this section shall have the following meaning when found
in this act, to wit:
“Commerce” means commerce among the several States or with foreign nations, or in any
Territory of the United States or in the District of Columbia, or between any such Territory and
another, or between any such Territories and any State or foreign nation, or between the District
of Columbia and any State or Territory or foreign nation.
“Corporation” means any company or association incorporated or unincorporated, which is
organized to carry on business for profit and has shares of capital or capital stock, and any
company or association, incorporated or unincorporated, without shares of capital or capital
stock, except partnerships, which is organized to carry on business for its own profit or that of
its members.
“Documentary evidence” means all documents, papers, and correspondence in existence at
and after the passage of this act.
“Acts to regulate commerce” means the act entitled “An act to regulate commerce,” approved
February fourteenth, eighteen hundred and eighty-seven, and all acts amendatory thereof and
supplementary thereto.
“Antitrust acts” means the act entitled “An act to protect trade and commerce against unlawful
restraints and monopolies,” approved July second, eighteen hundred and ninety; also the
sections seventy-three to seventy-seven, inclusive, of an act entitled “An act to reduce taxation,
to provide revenue for the Government, and for other purposes,” approved August twentyseventh, eighteen hundred and ninety-four; and also the act entitled “An act to amend sections
seventy-three and seventy-six of the act of August twenty-seventh, eighteen hundred and ninetyfour, entitled ‘An act to reduce taxation, to provide revenue for the Government, and for other
purposes,’” approved February twelfth, nineteen hundred and thirteen.
SEC. 5. That unfair methods of competition in commerce are hereby declared unlawful.
The commission is Hereby empowered and directed to prevent persons, partnerships, or
corporations, except banks, and common carriers subject to the acts to regulate commerce, from
using unfair methods of competition in commerce.
Whenever the commission shall have reason to believe that any such person, partnership, or
corporation has been or is using any unfair method of competition in commerce, and if it shall
appear to the commission that a proceeding by it in respect thereof would be to the interest of
the public, it shall issue and serve upon such person, partnerships or corporation a complaint
starting its charges in their respect, and containing a notice of a hearing upon a day and at a
place therein fixed at least thirty days after the service of said complaint. The person,
partnership, or corporation so complained of shall have the right to appear at the place and time
so fixed and show cause why an order should not be entered by the commission requiring such
person, partnership, or corporation to cease and desist from the violation of the law so charged
in said complaint. Any person, partnership, or corporation may make application, and upon
good cause shown may be allowed by the commission, to intervene and appear in said
proceeding by counsel or in person. The testimony in any such proceeding shall be reduced to

writing and filed in the office of the commission. If upon such hearing the commission shall be
of the opinion that the method of competition in question is prohibited by this act, it shall make
a report in writing in which it shall state its findings as to the facts, and shall issue and cause to
be served on such person, partnership, or corporation an order requiring such person,
partnership, or corporation to cease and desist from using such method of competition. Until
a transcript of the record in such hearing shall have been filed in a circuit court of appears of the
United States, as hereinafter provided, the commission may at any time, upon such notice and
in such manner as it shall deem proper, modify or set aside, in whole or in part, any report or
any order made or issued by it under this section.

88

ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

If such person, partnership, or corporation fails or neglects to obey such order of the
commission while this same is in effect, the commission may apply to the circuit court of
appeals of the United States, within any circuit where the method of competition in question was
used or where such person, partnership, or corporation resides or carries on business, for the
enforcement of its order, and shall certify and file application transcript of the entire record in
the proceeding, including all testimony taken and the report and order of the commission. Upon
such filing of the application and transcript the court shall cause notice thereof to be served upon
such person, partnership, or corporation and thereupon shall have jurisdiction of the proceeding
and of the question determined therein, and Shall have power to make and enter upon the
pleadings, testimony, and proceedings set forth in such transcript a decree affirming, modifying,
or setting aside the order of the commission. The findings of the commission as to the facts, if
supported by testimony, shall be conclusive. If either party shall apply to the court for leave to
adduce additional evidence, and shall show to the satisfaction of the court that such additional
evidence is material, and that there were reasonable grounds for the failure to adduce such
evidence in the proceeding before the commission, the court may order such additional evidence
to be taken before the commission and to be adduced upon the hearing in such manner and upon
such terms and conditions as to the court may seem proper. The commission may modify its
findings as to the fact, or make new findings, by reason of the additional evidence so threat, and
it shall file such modified or new findings, which, If supported by testimony, shall be conclusive,
and its recommendation, If any, for the modification or setting aside of its original order, with
the return of such additional evidence. The judgment and decree of the court shall be final,
except that the same shall be subject to review by the Supreme Court upon certiorari as provided
in section two hundred and forty of the Judicial Code.
Any party required by such order of the commission to cease and desist from using such
method of competition may obtain a review of such order in said circuit court of appeals by
filing in the court a written petition praying that the order of the commission be set beside. A
copy of such petition Shall be forthwith served upon the commission, and thereupon the
commission forthwith shall certify and file in the court a transcript of the record as hereinbefore
provided. Upon the filing of the transcript the court shut have the same jurisdiction to affirm,
set aside, or modify the order of the commission as in the case of an application by the
commission for the enforcement of its order, and the findings of the commission as to the facts,
if supported by testimony, shall in like manner be conclusive.
The jurisdiction of the circuit court of appeals of the United States to enforce, set aside, or
modify orders of the commission Shall be exclusive.
Such proceedings in the circuit court of appeals Shall be given precedence over other cases
pending therein, and shall be in every way expedited. No order of the commission or judgment
of the court to enforce the same shall In anywise relieve or absolve any person, partnership, or
corporation from any liability under the antitrust acts.
Complaints, orders, and other processes of the commission under this section may be served
by anyone duly authorized by the commission, either (a) by delivering a copy thereof to the
person to be served, or to a member of the partnership to be served, or to the president,
secretary, or other executive officer or a director of the corporation to he Served ; or (b) by
leaving a copy thereof at the principal office or place of business of such person, partnerships
or corporation; or (c) by registering and mailing a copy thereof addressed to such person,
partnership, or corporation at his or its principal office or place of business. The verified return
by the person so serving said complaint, order, or other process setting forth the manner of said
service shelf be proof of the same, and the return post-office receipt for said complaint, order,

or other process registered and mailed as aforesaid shall be proof of the service of the same.
SEC. 6. That the commission shall also have power-(a) To gather and compile information concerning, and to investigate from time to time the
organization, business, conduct, practices, and management of any corporation engaged in
commerce, excepting, banks and common carriers and it subject to the act to regulate commerce,
relation to other corporations and to Individuals, associations, and in partnerships.
(b) To require, by general or special orders, corporations engaged in commerce, excepting,
banks, and common carriers subject to the act to regulate

FEDERAL TRADE COMMISSION ACT

89

commerce, or any class of them, or any of them, respectively, to file with the commission in
such form as the commission may prescribe annual or special, or both annual and special,
reports or answers in writing to specific questions, furnishing to the commission such
information as it may require as to the organization, business, conduct, practices, management,
and relation to other corporations, partnerships, and individuals of the respective corporations
filing such reports or answers in writing. Such reports and answers shall be made under oath,
or otherwise, as the commission may prescribe, and shall be filed with the commission within
such reasonable period as the commission may prescribe, unless additional time be granted in
any case by the commission.
(c) Whenever a final decree has been entered against any defendant corporation in any suit
brought by the United States to prevent and restrain any violation of the antitrust acts, to make
investigation, upon its own initiative, of the manner in which the decree has been or is being
carried out, and upon the application of the Attorney General it shall be its duty to make such
investigation. It shall transmit to the Attorney General a report embodying its findings and
recommendations as a result of any such investigation, and the report shall be made public in
the discretion of the commission.
(d) Upon the direction of the President or either House of Congress to investigate and report
the facts relating to any alleged violations of the antitrust acts by any corporation.
(e) Upon the application of the Attorney General to investigate and make recommendation
for the readjustment of the business of any corporation alleged to be violating the antitrust acts
in order that the corporation may thereafter maintain its Organization, management, and conduct
of business in accordance with law.
(f) To make public from time to time such portions of the information obtained by it
hereunder, except trade secrets and names of customers, as it shall deem expedient in the public
interest; and to make annual and special reports to the Congress and to submit therewith
recommendations for additional legislation; and to provide for the publication of its reports and
decisions in such form and manner as may be best adapted for public information and use.
(g) From time to time to classify corporations and to make, rules and regulations for the
purpose of carrying out the provisions of this act.
(h) To investigate, from time to time, trade conditions in and with foreign countries where
associations, combinations, or practices of manufacturers, merchants, or traders, or other
conditions, may affect the foreign trade of the United States, mid to report to Congress thereon,
with such recommendations as it deems advisable.
SEC. 7. That in any suit in equity brought by or under the direction of the Attorney General
as provided in the antitrust acts, the court may, upon the conclusion of the testimony therein, if
it shall be then of opinion that the complainant is entitled to relief, refer said suit to the
commission, as a master in chancery, to ascertain and report an appropriate form of decree
therein. The commission shall proceed upon such notice to the parties and under such rules of
procedure as the court may prescribe, and upon the coming in of such report such exceptions
may be filed and such proceedings had in relation thereto as upon the report of a master in other
equity causes, but the court may adopt or reject such report, in whole or in part, and enter such
decree as the nature of the case may in its judgment require.
SEC. 8. That the several departments and bureaus of the Government when directed by the
President shall furnish the commission, upon its request, all records, papers, and information in
their possession relating to any corporation subject to any of the provisions of this act, and shall
detail from time to time such officials and employees to the commission as he may direct.
SEC. 9. That for the purposes of this act the commission, or its duly authorized agent or

agents, shall at all reasonable times have access to, for the purpose of examination, and the right
to copy any documentary evidence of any corporation being investigated or proceeded against;
and the commission shall naive power to require by subpena the attendance and testimony of
witnesses and the production of all such documentary evidence relating to any matter under
investigation. Any member of the commission may sign subpoenas, and members and
examiners of the commission may administer oaths and affirmations, examine witnesses, and
receive evidence.
Such attendance of witnesses, and the production of such documentary evidence, may be
required from any place in the United States, at any designated

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

place of hearing. And in case of disobedience to a subpoena the commission may invoke the
aid of any court of the United States in requiring the attendance and testimony of witnesses and
the protection of documentary evidence.
Any of the district courts of the United States within the jurisdiction of which such inquiry is
carried on may, in case of contumacy or refusal to obey a subpoena issued to any corporation
or other person, issue an order requiring such corporation or other person to appear before the
commission, or to produce documentary evidence if so ordered, or to give evidence touching
the matter in question; and any failure to obey such order of the court may be punished by such
court is a contempt thereof.
Upon the application of the Attorney General of the United States, at the request of the
commission, the district courts of the United States shall have jurisdiction to issue writs of
mandamus commanding any person or corporation to comply with the provisions of this act or
any order of the commission made in pursuance thereof.
The commission may order testimony to be taken by deposition in any proceeding or
investigation pending under this act at any stage of such proceeding or investigation. Such
depositions may be taken before any person designated by the commission and having power
to administer oaths. Such testimony shall be reduced to writing by the person taking the
deposition, or under his direction, and shall then be subscribed by the deponent. Any person
may be compelled to appear and depose and to produce documentary evidence In the same
manner as witnesses may be compelled to appear and testify and produce documentary evidence
before the commission as hereinbefore provided.
Witnesses summoned before the commission shall be paid the same fees and mileage that are
paid witnesses in the courts of the United States, and witnesses whose depositions are taken and
the persons taking the same shall severally be entitled to the same fees as are paid for like
services in the courts of the United States.
No person shall be excused from attending and testifying or from producing documentary
evidence before the commission or in obedience to the subpoena of the commission on the
ground or for the reason that the testimony or evidence, documentary or otherwise, required of
him may tend to criminate him or subject him to a penalty or forfeiture. But no natural person
shall be prosecuted or subjected to any penalty or forfeiture for or on account of any transaction,
matter, or thing concerning which he may testify, or produce evidence, documentary or
otherwise, before the commission in obedience to a subpoena issued by it: Provided, That no
natural person so testifying shall be exempt from prosecution and punishment for perjury
committed in so testifying
SEC. 10. That any person who shall neglect or refuse to attend and testify, or to answer any
lawful inquiry, or to produce documentary evidence, if in his power to do so, in obedience to
the subpoena or lawful requirement of the commission, shall be guilty of an offense and upon
conviction thereof by a court of competent jurisdiction shall be punished by a fine of not less
than $1,000 nor more than $5,000, or by imprisonment for not more than one year, or by both
such fine and imprisonment.
Any person who shall willfully make, or cause to be made, any false entry or statement of fact
in any report required to be made under this act, or who shall willfully make, or cause to be
made, any false entry in any account, record, or memorandum kept by any corporation subject
to this act, or who shall willfully neglect or fail to make, or to cause to be made, full, true, and
correct entries In such accounts, records, or memoranda of all facts and transactions appertaining to the business of such corporation, or who shall willfully remove out of the jurisdiction
of the United States, or willfully mutilate, alter, or by ally other means falsify any documentary

evidence of such corporation, or who, shall willfully refuse to submit to the commission or to
any of its authorized agents, for the purpose of inspection and taking copies, any documentary
evidence of such corporation in his possession or within his control, shall be deemed guilty of
an offense against the United States, and shall be subject, upon conviction in any court of the
United States of competent jurisdiction, to a fine of not less than $1,000 nor more than $5,000,
or to imprisonment for a term of not more than three years, or to both such fine and
imprisonment.
If any corporation required by this act to file any annual or special report shall fail so to do
within the time fixed by the commission for filing the same, and such future shall continue for
thirty days after notice of such default, the corporation shall forfeit to the United States the sum
of $100 for each and every day of the continuance of such failure, which forfeiture shall be
payable

FEDERAL TRADE COMMISSION ACT

91

into the Treasury of the United States and shall be recoverable in a civil suit in the name of the
United States brought in the district where the corporation has its principal office or in any
district in which it shall do business. It shall be the duty of the various district attorneys, under
the direction of the Attorney General of the United States, to prosecute for the recovery of
forfeitures. The costs and expenses of such prosecution shall be paid out of the appropriation
for the expenses of the courts of the United States.
Any officer or employee of the commission who shall make public any information obtained
by the commission, without its authority, unless directed by a court, shall be deemed guilty of
a misdemeanor, and, upon conviction thereof, shall be punished by a fine not exceeding $5,000,
or by imprisonment not exceeding one year, or by fine and imprisonment, in the discretion of
the court.
SEC. 11. Nothing contained in this act shall be construed to prevent or interfere with the
enforcement of the provisions of the antitrust acts or the acts to regulate commerce, nor shall
anything contained In the act be construed to, alter, modify, or repeal the said antitrust acts or
the acts to regulate commerce or any part or parts thereof.
Approved, September 26, 1914.
15173--26----7

EXHIBIT 3.
PROVISIONS OF THE CLAYTON ACT WHICH CONCERN THE
FEDERAL TRADE COMMISSION
“Commerce,” as used herein, means trade or commerce among the Several States and with
foreign nations, or between the District of Columbia or any Territory of the United States and
any State, Territory, or foreign nation, or between any insular possessions or other places under
the jurisdiction of the United States, or between any such possession or place and any State or
Territory of the United States or the District of Columbia or any foreign nation, or within the
District of Columbia or any Territory or any insular possession or other place under the
jurisdiction of the United States: Provided, That nothing in this act contained shall apply to the
Philippine Islands.
The word “person” or “persons” wherever used in this act shall be deemed to include
corporations and associations existing under or authorized by the laws of either the United
States, the laws of any of the Territories, the laws of any State, or the laws of any foreign
country.
SEC. 2. That it shall he unlawful for any person engaged In commerce, in the course of such
commerce, either directly or indirectly to discriminate in price between different purchasers of
commodities, which commodities are sold for use, consumption, or resale within the United
States or any Territory thereof or the District of Columbia or any insular possession or other
place under the jurisdiction of the United States, where the effect of such discrimination may
be to substantially lessen competition or tend to create a monopoly in any line of commerce:
Provided, That nothing herein contained shall prevent discrimination in price between
purchasers, of commodities, on account of differences in the grade, quality, or quantity of the
commodity sold, or that makes only due allowance for difference in the cost of selling or
transportation, or discrimination in price in the same or different communities made in good
faith to meet competition: And provided further, That nothing herein contained shall prevent
persons engaged in selling goods, wares, or merchandise in commerce from .selecting their own
customers in bona fide transactions and not in restraint of trade.
SEC. 3. That it shall be unlawful for any person engaged in commerce, in the course of such
commerce, to lease or make a sale. or contract for sale of goods, wares, merchandise, machinery,
supplies or other commodities, whether patented or unpatented, for use, consumption, or resale
within the United States or any Territory thereof or the District of Columbia or any insular
possession or other place under the jurisdiction of the United States, or fix a price charged
therefore or discount front, or rebate upon, such price, on the condition, agreement or
understanding that the lessee or purchaser thereof shall not use or deal in the goods, wares,
merchandise, machinery, supplies, or other commodities of a competitor or competitors of the
lessor or seller, where the effect of such lease, sale, or contract for sale or such condition,
agreement or understanding may be to substantially lesson competition or tend to, create a
monopoly in any line of commerce.
SEC. 7. That no corporation engaged in commerce shall acquire, directly or indirectly, the

whole or any part of the stock or other share capital of another corporation engaged also in
commerce, where the effect of such acquisition maybe to substantially lessen competition
between the corporation whose stock is so acquired and the corporation making the acquisition,
or to restrain such commerce in any section or community, or tend to create a monopoly of any
line of commerce.
No corporation shall acquire, directly or indirectly the whole or any part of the stock or other
share capital of two or more corporations engaged in commerce where the effect of such
acquisition, or the use of such stock by the voting or granting of proxies or otherwise, may be
to substantially lessen
92

PROVISIONS OF THE CLAYTON ACT

93

competition between such corporations, or any of them, whose stock or other share capital is so
acquired, or to restrain such commerce in any section or community, or tend to create a
monopoly of any line of commerce.
This section shall not apply to corporations purchasing such stock solely for Investment and
not using the same by voting or otherwise to bring about, or in attempting to bring about, the
substantial lessening of competition. Nor shall anything contained in this section prevent a
corporation engaged in commerce from causing the formation of subsidiary corporations for the
actual carrying on of their immediate lawful business, or the natural and legitimate branches or
extensions thereof, or from owning and holding all or a part of the stock of such subsidiary
corporations, when the effect of such formation is not to substantially lessen competition.
Nor shall anything herein contained be construed to prohibit any common carrier subject to
the laws to regulate commerce from aiding in the construction of branches or short lines so
located as to become feeders to the main line of the company so aiding in such construction or
from acquiring or owning all or any part of the stock of such branch lines, nor to prevent any
such common carrier from acquiring and owning all or any part of the stock of a branch or short
line constructed by an independent company where there is no substantial competition between
the company owning the branch line so constructed land the company owning the main line
acquiring the property or an interest therein, nor to prevent such common carrier from extending
any of its lines through the medium of the acquisition of stock or otherwise of any other such
common carrier where there is no substantial competition between the company extending its
lines and the company whose stock, property, or an interest therein is so acquired.
Nothing contained. in this section shall be held to affect or impair any right heretofore legally
acquired: Provided, That nothing in this section shall be held or construed to authorize or make
lawful anything heretofore prohibited or made illegal by the antitrust laws, nor to exempt any
person from the penal provisions thereof or the civil remedies therein provided.
SEC. 8. That from and after two years from the date of the approval of this act no person at
the same time shall be a director in any two or more corporations, any one of which has capital,
surplus, and undivided profits aggregating more than $1,000,000, engaged in whole or in part
in commerce, other than banks, banking associations, trust companies and common carriers
subject to the act to regulate commerce, approved February fourth, eighteen hundred and eightyseven, if such corporations are or shall have been theretofore, by virtue of their business and
location of operation, competitors, so that the elimination of competition by agreement between
them would constitute a violation of any of the provisions of any of the antitrust laws. The
eligibility of a director under the foregoing provision shall be determined by the aggregate
amount of the capital, surplus, and undivided profits, exclusive of dividends declared but not
paid to stockholders, at the end of the fiscal year of said corporation next preceding the election
of directors, and when a director has been elected in accordance with the provisions of this act
it shall be lawful for him to continue as such for one year thereafter.
When any person elected or chosen as a director or officer or selected as an employee of any
bank or other corporation subject to the provisions of this act is eligible at the time of his
election or selection to act for such bank or other corporation in such capacity his eligibility to
act in such capacity shall not be affected and he shall not become or be deemed amenable to ally
of the provisions hereof by reason of any crime in the affairs of such bank or other corporation
from whatsoever cause, whether specifically excepted by any of the provisions hereof or not,
until the expiration of one year from the date of his election or employment.
*
*
*
*
*
*
*
SEC. 11. That authority to enforce compliance with sections two, three, seven and eight of
this act by the persons respectively subject thereto is hereby vested in the Interstate Commerce
Commission where applicable to common carriers, in the Federal Reserve Board where
applicable to banks, banking associates and trust companies, and in the Federal trade
Commission where applicable to all other character of commerce, to be exercised as follows:

Whenever the Commission or Board vested with jurisdiction thereof shall have reason to
believe that any person is violating or has violated any of the provisions of sections two, three,
seven and eight of this act, it shall issue and serve upon such person a complaint stating its
charges in that respect, and

94

ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

containing a notice of a hearing upon a day and at a place therein fixed at least thirty days after
the service of said complaint. The person so complained of shall have the right to appear at the
place and time so fixed and show cause why an order should not be entered by the commission
or board requiring such person to cease and desist from the violation of the law so charged in
said complaint. Any person may make application, and upon good cause spoken may be
allowed by the commission or board, to intervene and appear in said proceeding by counsel or
in person. The testimony in any such proceeding shall be reduced to writing and filed in the
office of the commission or board. If upon such hearing the commission or board, as the case
may be, shall be of the option that any of the provisions of said sections have been or ire being
violated, it shall make a report in writing in which it shall state its findings as to the facts, and
shall issue and cause to be served on such person an order requiring such person to cease and
desist from such violations, and divest itself of the stock held or rid itself of the directors chosen
contrary to the provisions of sections seven and eight of this act, if any there be, in the manner
and within the time fixed by said order. Until a transcript of the record in such notice shall have
been filed in a circuit court of appeals of the United States, as hereinafter provided, the
commission or board may at any time, upon such notice and in such manner as it shall deem
proper, modify or set aside, in whole or in part, any report or any order made or issued by it
under this section.
If such person fails or neglects to obey such order of the commission or board while the same
is in effect, the commission or board may apply to the circuit Court of appeals of the United
States, within any circuit where the violation complained or was or is being committed or where
such person resides or carries on business, for the enforcement of its order, and shall certify and
file with its application a transcript of the entire record in the proceeding including all the
testimony taken and the report and order of the commission or board. Upon such filling of the
application and transcript the court shall cause notice thereof to be served upon such person and
thereupon shall have jurisdiction of the proceeding and of the question determined therein, and
shall have power to make and enter upon the pleadings, testimony, and proceedings set forth in
such transcript a decree affirming, modifying, or setting aside the order of the commission or
board. The findings of the commission or board as to the facts, if supported by testimony, shall
be conclusive. If either party shall apply to the court for leave to adduce additional evidence,
and shall show to the satisfaction of the court that such additional evidence is material and
thwart there were reasonable grounds for the failure to adduce such evidence In the proceeding
before the commission or board, the court may order such additional evidence to be taken before
the commission or board and to be adduced upon the hearing In such manner and upon such
terms and conditions as to the court may seem proper. The commission or board may modify
its findings as to the facts, or make new findings, by reason of the additional evidence so taken,
and it shall file such modified or new findings, which, if supported by testimony, shall be
conclusive, and its recommendation, if any, for the modification or setting aside of its original
order, with the return of such additional evidence. The judgment and decree of the court shall
be final, except that the same shall be subject to review by the Supreme Court upon certiorari
as provided in section two hundred and forty of the Judicial Code.
Any party required by such order of the commission or board to cease and desist from a
violation charged may obtain a review of such order In said circuit court of appears by finite in
the court a written petition praying that the order of the commission or board be set aside. A
copy of such petition shall be forthwith served upon the commission or board, and thereupon
the commission or board forthwith shall certify and file in the court a transcript of the record as
hereinbefore provided. Upon the filing of the transcript the court shall have the same
jurisdiction to affirm, set aside, or modify the order of the commission or board as in the case
of an application by the commission or board for the enforcement of its order, and the finding
of the commission or board as to the facts, if supported by testimony, shall in like manner be
conclusive.

The jurisdiction of the circuit court of appeals of the United States to enforce, set aside, or
modify orders of the commission or board shall be exclusive.
Such proceedings in the circuit court of appeals shall be given precedence over other cases
pending therein, and shall be in every way expedited. No order of the commission or board or
the judgment of the court to enforce the

PROVISIONS OF THE CLAYTON ACT

95

same shall in any wise relieve or absolve any person from any liability under the antitrust acts.
Complaints, orders, and other processes of the commission or board under this section may
be served by anyone duly authorized by the commission or board, either (a) by delivering a copy
thereof to the person to be served. or to a member of the partnership to be served, or to the
president, secretary, or other executive officer or a director of the corporation to be served; or
(b) by leaving a copy thereof at the principal office or place of business of such person; or (c)
by registering and mailing a copy thereof addressed to such person at his principal office or
place of business. The verified return by the person so serving said complaint, order, or other
process setting forth the manner of said service shall be proof of the same, and the return postoffice receipt for said complaint, order, or other process registered and mailed as aforesaid shall
be proof of the service of the same.
*
*
*
*
*
*
*
Approved, October 15, 1914.

EXHIBIT 4
EXPORT TRADE ACT
AN ACT To promote export trade, and for other purposes
Be it enacted by the Senate and House of Representatives of the United States Of America in
Congress assembled, That the words “export trade” wherever used in this act mean solely trade
or commerce in goods, wares, or merchandise exported, or in the course of being exported from
the United States or any Territory thereof to any foreign nation; but the words “export trade”
shall not be deemed to include the production, manufacture, or selling for consumption or for
resale, within the United States or any Territory thereof, of such goods, wares, or merchandise,
or any act in the course of such production, manufacture, or selling for consumption or for
resale.
That the words “trade within the United States” wherever used in this act mean trade or
commerce among the several States or in any Territory of the United States, or in the District
of Columbia, or between any such Territory and another, or between any such Territory or
Territories and any State or States or the District of Columbia, or between the District of
Columbia and any State or States.
That the word “association” wherever used in this act means any corporation or combination,
by contract or otherwise, of two or more persons, partnerships, or corporations.
SEC. 2. That nothing contained in the act entitled “An act to protect trade and commerce
against unlawful restraints and monopolies,” approved July second, eighteen hundred and
ninety, shall be construed as declaring to be illegal an association entered into for the sole
purpose of engaging in export trade and actually engaged solely in such export trade, or an
agreement made or act done in the course of export trade by such association, provided such
association, agreement, or act is not in restraint of trade within the United States, and is not in
restraint of the export trade of any domestic competitor of such association: And provided
further, That such association does not, either in the United States or elsewhere, enter into any
agreement, understanding, or conspiracy, or do any act which artificially or intentionally
enhances or depresses prices within the United States of commodities of the class exported by
such association, or which substantially lessens competition within the United States or
otherwise restrains trade therein.
SEC. 3. That nothing contained in section seven of the act entitled “An act to supplement
existing laws against unlawful restraints and monopolies, and for other purposes,” approved
October fifteenth, nineteen hundred and fourteen, shall be construed to forbid the acquisition
or ownership by any corporation of the whole or any part of the stock or other capital of any
corporation organized solely for the purpose of engaging in export trade, and actually engaged
solely in such export trade, unless the effect of such acquisition or ownership may be to restrain
trade or substantially lessen competition within the United States.
SEC. 4. That the prohibition against “unfair methods of competition” and the remedies
provided for enforcing said prohibition contained in the act entitled “An act to create a Federal
trade commission, to define its powers and duties, and for other purposes,” approved September
twenty-sixth, nineteen hundred and fourteen, shall be construed as extending to unfair methods
of competition used in export trade against competitors engaged in export trade, even though
the acts constituting such unfair methods are done without the territorial jurisdiction of the
United States.

SEC 5. That every association now engaged solely in export trade, within sixty days after the
passage of this act, and every association entered into hereafter which engages solely in export
trade, within thirty days after its creation, shall file with the Federal Trade Commission a
verified written state96

EXPORT TRADE ACT

97

ment setting forth the location of its offices or places of business and the names and addresses
of all its officers and of all its stockholders or members, and if a corporation, a copy of its
certificate or articles of incorporation and by-laws, and if unincorporated a copy of its articles
or contract of association , and on the first day of January of each year thereafter it shall make
a like statement of the location of its offices or places of business and the names and addresses
of all its officers and of all its stockholders or members and of all amendments to and changes
in its articles or certificate of incorporation or in its articles or contract of association. It shall
also furnish to the commission such information as the commission may require as to its
organization, business, conduct, practices, management, and relation to other associations,
corporations, partnerships, and individuals. Any association which shall fail so to do shall not
have the benefit of the provisions of section two and section three of this act, and it shall also
forfeit to the United States the sum of $100 for each and every day of the continuance of such
failure, which forfeiture shall be payable into the Treasury of the United States, and shall be
recoverable in a civil suit in the name of the United States brought in the district where the
association has its principal office, or in any district in which it shall do business. It shall be the
duty of the various district attorneys, under the direction of the Attorney General of the United
States, to prosecute for the recovery of the forfeiture. The costs and expenses of such prosecution shall be paid out of the appropriation for the expenses of the courts of the United States.
Whenever the Federal Trade Commission shall have reason to believe that an association or
any agreement made or act done by such association is in restraint of trade within the United
States or in restraint of the export trade of any domestic competitor of such association, or that
an association either in the United States or elsewhere has entered into any agreement,
understanding, or conspiracy, or done any act which artificially or intentionally enhances or
depresses prices within the United States of commodities of the class exported by such
association, or which substantially lessens competition within the United States or otherwise
restrains trade therein it shall summon such association, its officers, and agents to appear
Therefore it, and thereafter conduct an investigation into the alleged violations of law. Upon
investigation, if it shall conclude that the law has been violated, it may make to such association
recommendations for the readjustment of its business, in order that it may there-after maintain
its organization and management and conduct its business in accordance with law. If such
association fails to comply with the recommendations of the Federal Trade Commission , said
commission shall refer its findings and recommendations to the Attorney General of the United
States for such action thereon as he may deem proper.
For the purpose of enforcing these provisions the Federal Trade Commission shall have all
the powers, so far as applicable, given it in “An act to create a Federal Trade Commission, to
define its powers and duties, and for other purposes.”
Approved, April 10, 1918.

EXHIBIT 5.
RULES OF PRACTICE BEFORE THE FEDERAL TRADE COMMISSION
I. SESSIONS.
The principal office of the commission at Washington, D. C., is open each business day from
9 a.m. to 4:30 p.m. The commission may meet and exercise all its powers at any other place, and
may, by one or more of its members, or by such examiners as it may designate, prosecute any
inquiry necessary to its duties in any part of the United States.
Sessions of the commission for hearing contested proceedings will be held as ordered by the
commission.
Sessions of the commission for the purpose of making orders and for the transaction of other
business, unless otherwise ordered, Will be held at the office of the commission at Washington,
D. C., on each business day at 10.30 a. m. Three members of the commission shall constitute
a quorum for the transaction of business.
All orders of the commission shall be signed by the Secretary.
II. COMPLAINTS.
Any person partnership, corporation, or association may apply to the commission to institute
a proceeding in respect to any violation of law over which the commission has jurisdiction.
Such application shall be in Writing, signed by or in behalf of the applicant, and shall contain
a short and simple statement of the facts constituting the alleged violation of law and the name
and address of the applicant and of the party complained of.
The commission shall investigate the matters complained of in such application, and if upon
investigation the commission shall have reason to believe that there is a violation of law over
which the commission has jurisdiction, the commission shall issue and serve upon the party
complained of a complaint, stating its charges and containing a notice of a hearing upon a day
and at a place therein fixed at least 40 days after the service of said complaint.
III. ANSWERS.
Within 30 days from the service of the complaint, unless such time be extended by order of
the commission, the defendant shall file with the commission an answer to the complaint. Such
answer shall contain a short and simple statement of the facts Which constitute the ground of
defense. It shall specifically admit or deny or explain each of the facts alleged in the complaint,
unless the defendant is without knowledge, in which case lie shall so state, such statement
operating as a denial. Answers in typewriting must be on one side of the paper only, on paper
not more then 8 ½ inches wide and not more than 11 inches long, and weighing not less then 16
pounds to the ream, folio base, 17 by 22 Inches, with left-hand margins not less than 1 ½ inches
wide, or they may be printed in 10 or 12 point type on good unglazed paper 8 inches wide by
10 ½ inches long, with inside margins not less than 1 inch wide. Three copies of such answers
must be furnished.
IV. SERVICE.
Complaints, orders, and other processes of the commission may be served by anyone duly

authorized by the commission, either (a) by delivering a copy
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99

thereof to the person to be served, or to a member of the partnership to be served, or to the
president, secretary, or other executive officer, or a director of the corporation or association
to be served; or (b) by leaving a copy thereof at the principal office or place of business of such
person, partnership, corporation, or association; or (c) by registering and mailing a copy
thereof addressed to such person, partnership, corporation, or association at his or its principal
office or place of business. The verified return by the person so serving said complaint, order,
or other process, setting forth the manner of said service, shall be proof of the same, and the
return post-office receipt for said complaint, order, or other process, registered and wailed as
aforesaid, shall be proof of the service of the same.
V. INTERVENTION.
Any person, partnership, corporation, or association desiring to intervene in a contested
proceeding shall make application in writing, setting out the grounds on which lie or it claims
to be interested. The commission may, by order, permit intervention by counsel or in person
to such extent and upon such terms as it shall deem just.
Applications to intervene must be on one side of the paper only, on paper not more than 8 ½
inches wide and not more than 11 inches long, and weighing not less than 16 pounds to the
ream, folio base, 17 by 22 inches, with left-hand margin not less than 1 ½ inches wide, or they
may be printed in 10 or 12 point type on good unglazed paper 8 inches wide by 10 ½ inches
long, with inside margins not less than 1 inch wide.
VI. CONTINUANCES AND EXTENSIONS OF TIME.
Continuances and extensions of time will be granted at the discretion of the commission.
VII. WITNESSES AND SUBPOENAS.
Witnesses shall be examined orally, except that for good and exceptional cause for departing
from the general rule the commission may permit their testimony to be taken by deposition.
Subpoenas requiring the attendance of witnesses from any place in the United States at any
designated place of hearing may be issued by any member of the commission.
Subpoenas for the production of documentary evidence (unless directed to issue by a
commissioner upon his own motion) will issue only upon application in writing, which must be
verified and must specify, as near as may be, the documents desired and the facts to be proved
by them.
Witnesses summoned before the commission shall be paid the same fees and mileage that are
paid witnesses in the courts of the United States, and witnesses whose depositions are taken, and
the persons taking the same, shall severally be entitled to the same fees as are paid for like
services in the courts of the United States. Witness fees and mileage shall be paid by the part
at whose instance the witness appear.
VIII. TIME FOR TAKING TESTIMONY.
Upon the joining of issue in a proceeding by the Commission the examination of witnesses
therein shall proceed with all reasonable diligence and with the least practicable delay. Not less
than 5 nor more than 10 days’ notice shall be given by the Commission to counsel or parties of
the time and place of examination of witnesses before the Commission, a commissioner, or an
examiner.

IX. OBJECTIONS TO EVIDENCE.
Objections to the evidence before the Commission, a commissioner, or an examiner shall, in
any proceeding, be in short form. starting the grounds of objections relied upon, and no
transcript filed shall include argument or debate.
X. MOTIONS.
A motion in a proceeding by the Commission shall briefly state the nature of the order
applied for, and all affidavits, records, and other helpers upon which

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the same is founded, except such as have been previously filed or served in the same proceeding,
shall be filed with such motion and plainly referred to therein.
XI. HEARINGS ON INVESTIGATIONS.
When a matter for investigation is referred to a single commissioner for examination or report,
such commissioner may conduct or hold conferences or bearings thereon, either alone or with
other commissioners who may sit with him, and reasonable notice of the time and place of such
hearings shall be given to parties in interest and posted.
The general counsel or one of his assistants, or such other attorney as shall be designated by
the commission, shall attend and conduct such hearings, and such hearings may, in the discretion
of the commissioner holding same, be public.
XII. HEARINGS BEFORE EXAMINERS.
When issue in the case is set for trial it shall be referred to an examiner for the taking of
testimony. It shall be the duty of the examiner to complete the taking of testimony with all due
dispatch, and he shall set the day and hour to which the taking of testimony may from time to
time be adjourned. The taking of the testimony both for the commission and the respondent
shall be completed within 30 days after the beginning of the same unless, for good cause shown.
the commission shall extend the time. The examiner shall, within 10 days after the receipt of the
stenographic report of the testimony, make his proposed finding as to the facts and his proposed
order thereon, and shall forthwith serve copy of the same on the parties or their attorneys, who,
within 10 days after the receipt of same, shall file in writing their exceptions, if any, to such
proposed findings and order, and said exceptions shall specify the particular part or parts of the
proposed findings of fact or proposed order to which exception is made, and said exceptions
shall include any additional findings and any change In or addition to the proposed order which
either party may think proper. Citations to the record shall be made in support of such
exceptions. Where briefs are filed the same shall contain a copy of such exceptions. Argument
on the exceptions to the proposed findings and order, if exceptions be filed, shall be had at the
final argument on the merits.
XIII. DEPOSITIONS IN CONTESTED PROCEEDINGS.
The commission may order testimony to be taken by deposition in a contest proceeding.
Depositions may be taken before any person designated by the commission and having power
to. administer oaths.
Any party desiring to take the deposition of a witness shall make application in writing, setting
out the reasons why such depositions should be taken, and stating the time when, the place
where, and the name and post-office address of the person before whom it is desired the
deposition be taken, the name and post-office address of the witness, and the subject matter or
matters concerning which the witness is expected to testify. If good cause be shown, the
commission will make and serve upon the parties or their attorneys an order wherein the
commission shall name the witness whose deposition is to be taken, and specify the time when,
the place where, and the person before whom the witness is to testify, but such time and place,
and the person before whom the deposition is to be taken, so specified in the commission’s
order, may or may not be the same as those named in said application to the commission.
The testimony of the witness shall be reduced to writing by the officer before whom the
deposition is taken, or under his direction, after which the deposition shall be subscribed by the
witness and certified in usual form by the officer. After the deposition has been so certified it

shall, together with a copy thereof made by such officer or under his direction, be forwarded by
such officer under seal in an envelope addressed to the commission at its office In Washington,
D. C. Upon receipt of the deposition and copy the commission shall file in the record In said
proceeding such deposition and forward the copy to the defendant or the defendant’s attorney.
Such depositions shall be typewritten on one side only of the paper, which shall be not more
than 8 ½ inches wide and not more than 11 inches long and weighing not less than 16 pounds
to the ream, folio base, 17 by 22 inches, with left-hand margin not less than 11/2 inches wide.

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101

No deposition shall be taken except after at least 6 days’ notice to the parties. and where the
deposition is taken in a foreign country such notice shall be at least 15 days.
No deposition shall be taken either before the proceeding is at issue or, unless under special
circumstances and for good cause shown, within 10 days prior to the date of the hearing thereof
assigned by the commission, and where the deposition is taken in a foreign country it shall not
be taken after 30 days prior to such date of hearing.
XIV. DOCUMENTARY EVIDENCE.
Where relevant and material matter offered in evidence is embraced in a document containing
other matter not material or relevant and not intended to be put in evidence, such document will
not be filed, but a copy only of such relevant and material matter shall be filed.
XV. BRIEFS.
Unless otherwise ordered, briefs may be filed at the close of the testimony in each contested
proceeding. The presiding commissioner or examiner shall fix the time within which brief shall
be flied and service thereof shall be made upon the adverse parties.
All briefs must be filed with the secretary and be accompanied by proof of service upon the
adverse parties. Twenty copies of each brief shall be furnished for the use of the commission,
unless otherwise ordered.
Application for extension of time In which to file any brief shall be by petition in writing,
stating the facts upon which the application rests, which must be filed with the commission at
least 5 days before the time for filing the brief.
Every brief shall contain, in the order here stated-(1) A concise abstract or statement of the case.
(2) A brief of the argument, exhibiting a clear statement of the points of fact or law to be
discussed, with the reference to the pages of the record and the authorities relied upon in support
of each point.
Every brief of more than 10 pages shall contain on its top flyleaves a subject index with page
references. the subject index to be supplemented by a list of all cases referred to, alphabetically
arranged, together with references to pages where the cases are cited.
Briefs must be printed in 10 or 12 point type on good unglazed paper 8 inches by 101/2
inches, with inside margins not less than 1 inch wide and with double-leaded text and singleleaded citations.
Oral arguments will be had only as ordered by the commission.
XVI. ADDRESS OF THE COMMISSION.
All communications to the commission must be addressed to Federal Trade Commission,
Washington D. C., unless otherwise specially directed.

EXHIBIT 6
PROCEEDINGS DISPOSED OF JULY 1, 1925, TO JUNE 30, 1926
1. ORDERS TO CEASE AND DESIST
NOTE.--On or immediately before June 30, 1926, the commission mailed one order to cease
an desist in addition to those shown below. This action is properly reflected in the statistical
tables, but not individually indicated because service upon parties at interest had not been
effected at the close of the fiscal year. Two orders to cease and desist included in statistics for
1925 but served during 1926 are included herewith.
Complaint No. 868.--In the matter of Calumet Baking Powder Co. Charge: Unfair met hod
of competition in that the respondent, for the purpose of furthering the sale of its baking
powders, adopted the practice of publishing anonymously adverse, disparaging, and derogatory
opinions, statements and comments as to the wholesomeness of self-rising flours, the use of
which does not involve the addition of baking powder, such statements being not founded in
fact, all for the purpose of deceiving the purchasing public, in alleged violation of section 5 of
the Federal Trade Commission act:
Disposition : A stipulation having been entered in lieu of testimony. the commission entered
an order to cease and desist on February 8, 1920.
Complaint No. 974.--In the matter of Brooks Oil Co. and E A. Benedict. Charge: Unfair
methods of competition In commerce are charged in that the respondents, cooperating in the sale
of house paint, have falsely represented, advertised, and labeled said product as “U. S. Quality
Paint,” the said paint in fact being a low-grade product not made for nor used by the United
States Government and not made according to any Government specification or requirements,
in alleged violation of section 5 of the Federal Trade Commission act.
Disposition: After hearing, the commission entered an order to cease and desist on November
23, 1925.
Complaint No. 1023.--In the matter of International Shoe Co. Charge: It is charged that the
respondent, by acquiring substantially all of the capital stock of the W. H. McElwain Co.,
theretofore engaged In the manufacture and sale of shoes in competition with the respondent,
tends to lessen competition, restrain commerce, and create a monopoly, in alleged violation of
section 7 of the Clayton Act.
Disposition: After hearing, the commission entered an order to cease and desist on July 29,
1925, Commissioners Hunt and Humphrey dissenting.
Complaint No. 1083.--In the matter of Garnett S. Zorn and H. Voltze, doing business under
the trade name and style of S. Zorn & Co. Charge: Unfair methods of competition are charged
in that the respondent, engaged In the sale of grain adulterated oats by the addition of water and
screenings and charged customers on the basis of the total weight of the shipment multiplied by
the unit price of oats of the grade ordered, in alleged violation of section 5 of the Federal Trade
Commission act.
Disposition: After hearing, the commission entered an order to cease and desist on October
31.1925.
Complaint No. 1085.--In the matter of North Dakota Wholesale Grocers’ Association, its
officers and members. Charge: Unfair methods of competition are charged in that the

respondents have agreed to confine the distribution of groceries and allied products to “regular”
and “legitimate” channels of trade to wit: From the producer or manufacturer to the wholesaler,
from the wholesaler to the retail dealer; and to fix uniform wholesale prices and to prevent price
cutting, the said agreement, enforced by intimidation, coercion and boycotting, tending to
suppress and hinder competition and to obstruct the natural flow of commerce, in alleged
violation of section 5 of the Federal Trade Commission act.
Disposition: After hearing, the commission entered an order to cease and desist on July 20,
1925.
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103

Complaint No. 1098.--In the matter of (1) California Retail Fuel Dealers’ Association, its
officers and executive committee and members; (2) Retail Coal and Wood Dealers’ Association
of Alameda County, Stockton Retail Coal Dealers’ Association, Richmond Retail Fuel Dealers’
Association, Sacramento Retail Fuel Dealers’ Protective Association, San Jose Feed and Fuel
Dealers’ Protective Association, San Francisco Retail Coal Dealers’ Association, Peninsula Fuel
Dealers’ Association, Southern California Fuel and Feed Dealers’ Association, all members of
and constituting (1), their respective officers and members; (3) sundry wholesale coal
companies, members of (1), the State association; and (4) sundry retail dealers who are members
of (1), though not of any one of the local associations named in (2). Charge: Unfair methods
of competition are charged, namely, unduly obstructing and hindering competition and depriving
consumers of the advantages In price, etc., which they would obtain from the natural flow of
commerce in coal under conditions of free competition and further by causing producers and
wholesalers to feel constrained to confine the distribution of coal In California to channels
selected anti approved by respondents and thus preventing cooperative associations and socalled irregular dealers from securing coal at wholesale or from any other source than from the
so-called regular dealers and at the retail prices fixed by respondents (a “regular” retail dealer
being an association member who engages in the sale of coal or wood as a regular business,
buying to sell again; who owns and operates a yard, keeps an office, and displays a sign; has a
stock of coal and proper scales to weigh the same others are “irregular”), by price fixing by the
respective local associations, the observation by all of the prices fixed within the respective
territories covered thereby, punishment for nonobservance, refusal of respondent wholesalers
to supply coal to other than regular dealers, attempting to persuade and, that failing, to coerce
and compel other wholesalers and producers by boycott, threats of boycott, and other means of
intimidation not to sell except to “regular” dealers, and by other cooperative means, all in
alleged violation of section 5 of the Federal Trade Commission act.
Disposition: After hearing. the commission dismissed the complaint as to respondent A. C.
Scholosser F. P. Grady, Blue Diamond Coal Co., Standard Coal Co., Liberty Coal Co., J. S.
Critchlow individually and as agent of the Liberty Coal Co., Lion Coal Co., Gunn Guealy
(Quealy) Coal Co., King Coal Co., Frank J. Foran individually and as vice president of the King
Coal Co., Lion Rock Springs Coal Co., Frank Bosner individually and as manager of said Lion
Rock Springs Coal Co., Standard Coal Co. of California, Bear Fuel Co., Royal Coal Sales Co.,
E W. Matson individually and as agent for said Royal Coal Sales Co., Superior Rock Springs
Coal Co., Hugh Crea individually and as agent of said Superior Rock Springs Coal Co., Central
Coal & Coke Co., Charles R. Allen individually and as agent of said Central Coal & Coke Co.,
Utah Fuel Co., and William H. Myers individually and as agent for said Utah Fuel Co., and
entered an order to cease and desist as to the other respondents on November 11, 1925.
Complaint No. 1118.--In the matter of Missouri State Retail Coal Merchants Association, also
known as the Mid-West Retail Coal Association, its officers and members, and J. B. Sanborn
& Co. Charge: Unfair methods of competition are charged in that the respondents have
undertaken and cooperated to prevent the distribution of coal, in the territory served by
respondent association members, by any means other than through the so-called regular channels
controlled by members of the respondent association (who qualified for membership therein by
reason of the fact that they are regularly engaged in business of selling coal, coke, or other fuel
and have facilities and stock sufficient to meet the reasonable demand of the public), and to
prevent ir regular dealers, cooperative associations, and other consumers from obtaining coal
at wholesale prices or from any source other than the so-called regular dealers, thereby
obstructing and hindering competition in the sale of coal in the territory served by the
respondents and depriving consumers of the advantage in price which they would obtain from
the natural flow of commerce under conditions of free competition, in alleged violation of
section 5 of the Federal Trade Commission act

Disposition: After hearing, the commission entered an order to cease and desist on May 15,
1928.
Complaint No.1133.--In the matter of Edwin A. Ames, trading as Ostermoor & Co. Charge:
The respondent, in the sale of its felt mattresses attaches to each mattress a brand or label
carrying pictorial representations or depictions

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of complete and incomplete Ostermoor mattresses with superimposed layers of cotton felt
protruding therefrom. Unfair methods of competition are charged In that said depictions are
false, deceptive, and misleading, designed to deceive and mislead the purchasing public into the
belief that they were made from and are truthful portrayals of the Ostermoor mattress as offered
to the public, and that the cotton felt layers commonly known as “bats” are of great number and
possessed of great resilience and elasticity, when in fact said depictions were made from a model
specially constructed by the respondent and are grossly exaggerated and inaccurate depictions
of the content and quality of the mattresses sold by the respondent, and in that the respondent’s
advertising matter is similarly false and misleading, in alleged violation of section 5 of the
Federal Trade Commission act.
Disposition: After hearing, the commission entered an order to cease and desist on February
15, 1926, Commissioner Humphrey dissenting.
Complaint No. 1134.--In the matter of P. H. Hanes Knitting Co. Charge: Unfair methods of
competition are charged in that the respondent, engaged in the manufacture and sale of
underwear, fixes and maintains certain specified uniform prices for the resale of its products by
wholesale dealers, refusing to supply price-cutting dealers and employing various other
cooperative means for the enforcement of its system of resale prices, in alleged violation of
section 5 of the Federal Trade Commission act.
Disposition: After hearing, the commission entered an order to cease and desist on December
21, 1925.
Complaint No. 1141.--In the matter of Standard Oil Co. of Kentucky. Charge: Unfair
methods of competition are charged in that the respondent enforces a merchandising system by
which certain specified uniform prices are fixed and maintained for the resale of its stoves and
heaters by retail dealers, the respondent refusing to supply price cutters and employing
cooperative methods for the enforcement of said standard resale prices, thereby tending to
suppress competition and to deprive ultimate purchasers of the advantages they would obtain
from the natural and unobstructed flow of commerce in such commodities, in alleged violation
of section 5 of the Federal Trade Commission act.
Disposition: After a stipulation, entered in lieu of testimony, the commission entered an order
to cease and desist on November 28, 1925.
Complaint No. 1148.--In the matter of Harriet Hubbard Ayer (Inc.). Charge: Unfair methods
of competition are charged in that the respondent, engaged in the manufacture and sale of
perfumes, cosmetics, and allied products, fixed specified uniform prices for the resale of its
products by retailers, enforcing the observance of said standard resale prices by refusing to sell
to price cutters, and by the employment of cooperative means of price maintenance, in alleged
violation of section 5 of the Federal Trade Commission act.
Disposition: After hearing, the commission entered an order to cease and desist on October
7, 1925.
Complaint No. 1152.--In the matter of M. Goldberg, an individual doing business under the
trade name and style “Factory-to-You Furniture Store.” Charge: Unfair methods of competition
are charged in that the respondent retailer advertises and sells his furniture as from “Factory-toYou” when in fact the respondent is not a manufacturer but purchases for resale, and in that the
respondent advertises certain of his furniture as “mahogany” or “walnut” or “genuine leather”
when in fact said furniture is made of woods other than mahogany or walnut or is covered or
upholstered with material other than leather, and in imitation of genuine mahogany, walnut, or
leather, respectively, thereby tending to mislead and deceive the purchasing public as to price
and quality, in alleged violation of section 5 of the Federal Trade Commission act.
Disposition: After hearing, the commission entered an order to cease and desist on March 8,
1926.
Complaint No. 1174.--In the matter of Clayton F. Summy Co. Charge: Unfair methods of

competition are charged in that the respondent marks its sheet music with fictitious and
exaggerated retail prices, thereby tending to mislead and deceive the uninformed public as to
the actual value of the respondent’s product, in alleged violation of section 5 of the Federal
Trade Commission act.
Disposition: After hearing, the commission entered an order to cease and desist on December
7, 1925.

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Complaint No. 1175.--In the matter of W. J. Rooks, G. W. Rooks, J. R. Fox, C. T. Wass, I.
W. S. Sunberg, R. D. Rooks, James F. Quinn, and U. S. Oil Co. (Inc.). Charge: Unfair methods
of competition are charged in that the respondents have offered and given sums of money to
employees of purchasers of textile oils and allied products, without the knowledge and consent
of the employers and principals, as inducements to such employees to recommend the products
of the respondent corporation and secure the purchase thereof by their employers and principles
in preference to the like commodities of competitors of the respondent corporation, in alleged
violation of section 5 of the Federal Trade Commission act.
Disposition: After hearing, the commission entered and order to cease and desist on April 28,
1926.
Complaint No. 1186.--In the matter of The Good-Grape Co., a corporation. Charge: Unfair
methods of competition are charged in that the respondent, engaged in the manufacture and sale
of a sirup for beverages, labels and advertises Its product with the name “Good-Grape,” and
otherwise Indicates that It is composed of the juice of the natural fruit of the grape when in fact
said product is not made of the juice of the grape, thereby tending to mislead the purchasing
public as to the quality of its product and to stifle and suppress competition In the sale of
beverages made In whole or in part of Juice from the natural fruit of the grape and to divert the
trade from truthfully marked goods, in alleged violation of section 5 of the Federal Trade
Commission act.
Disposition: After hearing, the commission entered an order to cease and desist on April 13,
1926, Commissioner Thompson dissenting to the form of the order.
Complaint No. 1187.--In the matter of Franklin Coal Co. Charge: Unfair methods of
competition are charged in that the respondent sells its coal as Mt. Olive coal” and “Mt. Olive
district coal,” thereby tending to mislead the consuming public to believe that the respondent’s
coal Is the favorably known product of the Mount Olive district, In the State of Illinois, when
in fact the respondent’s coal is not derived from said Mount Olive district, in alleged violation
of section 5 of the Federal Trade Commission act. Status: Awaiting briefs.
Disposition: After hearing, the commission entered an order to cease and desist on February
5, 1926.
Complaint No. 1191.--In the matter of Furniture Manufacturers’ Show Rooms (Inc.). Charge:
Unfair methods of competition are charged in that respondent, engaged in the purchase and
resale of furniture and having no factory of his own, sells and advertises such furniture as “direct
from the factory,” thereby tending to mislead the purchasing public to believe that in dealing
with the respondent they are buying direct from the manufacturer and saving the profits of the
middlemen, and in that respondent represents and sells as mahogany, furniture made of woods
other than mahogany, all in alleged violation of section 5 of the Federal Trade Commission act.
Disposition: After hearing, the commission entered an order to cease and desist on October
2, 1925.
Complaint No. 1198.--In the matter of Harry Chessler and Russell W. Chessler, partners,
doing business under the trade names and styles Lexington Storage Warehouse Co. and
Lexington Warehouse Co. Charge: Unfair methods of competition are charged in that the
respondent signifies In Its advertising that it is an agent for manufacturers of furniture selling
direct to the consuming public, and that It deals In the favorably known Grand Rapids furniture,
manufactured In Grand Rapids, Mich., when In fact the respondent Is a retailer engaged in the
resale, at prevalent retail prices, of furniture for the most part made by manufacturers In no wise
connected with the furniture Industry of Grand Rapids, Mich., in alleged violation of section 5
of the Federal Trade Commission act.
Disposition: After hearing, the commission entered an order to cease and desist on September
28, 1925.
Complaint No. 1225.-In the matter of Morris Well and Elias Well, copartners, doing business

under the trade name and style, Associated Furniture Manufacturers Warehouse Co.; and
National Furniture Distributing Corporation, a corporation. Charge: Unfair methods of
competition are charged in that the respondents’ trade name and corporate name, and their
advertising matter and pretended guaranty of Grand Rapids furniture manufacturers tends to
mislead the purchasing public to believe that the respondents are sales agents for manufacturers
and that the respondents’ furniture is

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of Grand Rapids manufacture and quality, when in fact the furniture sold by the respondents is
for the most part made at points other than Grand Rapids, Mich., and is sold at retail, all in
alleged violation of section 5 of the Federal Trade Commission act.
Disposition: After hearing, the commission entered an order to cease and desist on September
28, 1925.
Complaint No. 1232.--In the matter of Arkansas Wholesale Grocers Association, its officers
and members, Searcy Wholesale Grocery Co., Arkansas Grocery Co., Brown-Hinton Wholesale
Grocery Co., J. Foster & Co., Silbernagel & Co. Charge: Unfair methods of competition are
charged in that the respondents in an endeavor to confine the distribution of groceries and allied
products to the so-called regular and legitimate channels of trade by which the distribution of
goods is effected via the wholesaler, attempted by means of intimidation and boycott to coerce
manufacturers and producers to refrain from supplying irregular dealers, and persecuted and
harassed irregular dealers; and in that the respondents cooperated to suppress price competition,
and encourage and support the maintenance of uniform prices established by manufacturers and
producers, by (a) publishing lists of names of manufacturers and producers enforcing a pricemaintenance system and urging members of the respondent association to confine their
purchases to such manufacturers and producers: (b) seeking to induce and coerce manufacturers
and producers to establish and enforce a system of resale price maintenance and threatening or
intimating boycott if they do not adopt and enforce such a system, and (c) urging members of
the respondent association to intimidate and boycott such nonconforming manufacturers and
producers, all in alleged violation of section 5 of the Federal Trade Commission act.
Disposition: After hearing, the commission entered all order to cease and desist on May 15,
1926.
Complaint No. 1236.--In the matter of David J. Goldsmith, doing business under the trade
name and style Hagen Import Co. of Pennsylvania. Charge: Unfair methods of competition are
charged in that the respondent, engaged in the retail sale of merchandise purchased in the
United States, tends to mislead the consuming public to believe that he is all importer and
manufacturer by displaying the trade name “Hagen Import Co. of Pennsylvania” in conjunction
with the statements “Importers--Manufacturers--Job and “European Office, Munich, Germany,”
and by labeling a domestic product as “Bavarian Style Old The Malt Extract in alleged
violation of section 5 of the Federal Trade Commission act.
Disposition: After hearing, the commission entered an order to cease and desist on March 6,
1926.
Complaint No. 1243.--In the matter of Jacques E. Greenberger, Ernst Greenberger, and
Normal J. Greenberger, partners doing business under the trade name and style Grand Rapids
Furniture Manufacturers Warehouse Association, Grand Rapids Furniture Manufacturers
Association (Inc.), a corporation. Charge: Unfair methods of competition are charged in that the
respondents, by the use of their trade name and corporate name and advertising slogans and
statements, mislead the purchasing public to believe that they are manufacturers of furniture or
authorized representatives of Grand Rapids manufacturers, when in fact they buy their furniture
for sale at retail; and in that the respondents practice fictitious price marking, refuse to refund
money to dissatisfied customers, stating falsely that the furniture factories at Grand Rapids will
not permit respondents to make such refunds; and in that the respondents cause postcards to be
mailed from Grand Rapids, Mich., to prospective customers, bearing statements to the effect that
the respondents’ place of business is the only show room of the furniture manufacturers of
Grand Rapids, Mich., all in alleged violation of section 5 of the Federal Trade Commission act.
Disposition: After hearing, the commission entered an order to cease and desist on September
26, 1925.
Complaint No. 1250.--In the matter of Houbigant (Inc.). Charge: Unfair methods of
competition are charged in that the respondent, engaged in the sale of perfumes and other toilet

articles, enforces a merchandising system adopted by it of establishing and maintaining certain
specified uniform prices at which Its toilet articles shall be resold by retailers, refusing to sell
to price cutters, and employing other cooperative means to prevent retailers from reselling at
prices less than those established by the respondent, In alleged violation of section 5 of the
Federal Trade Commission act.

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Disposition: After hearing the commission entered an order to cease and desist on April 2,
1926.
Complaint No. 1252.--In the matter of The Long-Koch Co., a corporation. Charge: Unfair
methods of competition are charged in that the respondent, engaged in the manufacture and sale
of jewelry, stamped certain of its knives “10K” or “14K,” thereby tending to mislead the
purchasing public to believe that the mountings of said knives were made of 10 karat or 14 karat
gold, when in fact said mountings consisted of metals other than gold, covered, faced, or
veneered with gold in whole or in part, in alleged violation of section 5 of the Federal Trade
Commission act.
Disposition: After hearing the commission entered an order to cease and desist on May 4,
1926. Commissioner Humphrey dissenting.
Complaint No. 1260.--In the matter of Edison Fixture Co. (Inc.), a corporation. Charge:
Unfair methods of competition are charged in that the respondent, engaged in the manufacture
and sale of a patented electrical fixture or device for the illumination of offices, stores,
showrooms, factories, etc., adopted and used the word “ Edison” as a part of its corporate name
without license from Thomas A. Edison, thereby tending to mislead the trade and purchasing
public into the erroneous belief that the respondent is affiliated with .ir licensed by tune said
Thomas A. Edison and that it is manufacturing under Edison patents, or us engaged in the sale
of Edison products ; and in that the respondent falsely represented to customers and prospective
customers that its product was sold on a two weeks’ trial, that the respondent would replace
burnt-out lamps, clean, and keep the fixture or device in repair as long as the same remained on
the premises of the purchaser, and that the lamps - sold by respondent were of greater
illuminating power than lamps of the same wattage produced by competitors, in alleged
violation of section 5 of the Federal Trade Commission act.
Disposition : After hearing, the commission entered an order to cease and desist on November
23, 1925.
Complaint No. 1261.--In the matter of Cohn-Hall-Marx Co., a corporation. Charge: Unfair
methods of competition are charged in that the respondent, engaged inn the importation of
cotton fabrics and the conversion thereof to simulate silk inn appearance and finish, represents
and advertises certain of its fabrics as “Cocoon Cloth” and has adopted as a trade name, brand,
or label the word “ Cocoon,” thereby tending to mislead and deceive the purchasing public into
tune belief that the respondent’s cotton fabrics are composed of silk in whole or inn part, in
alleged violation of section 5 of the Federal Trade Commission act.
Disposition : A stipulation having been entered in lieu of testimony, the commission entered
an order to cease and desist on June 9, 1926, Commissioners Nugent and Thompson dissenting.
Complaint No.1264.--In the matter of W. C. Blickenstaff; otherwise known as W. C. Buick,
doing business under the trade name and style Standard Fountain Pen Co. Charge: Unfair
methods of competition are charged in that then respondent, engaged in the sale of fountain pens
at wholesale, supplies circulars and advertising matter to his dealers which describe said pens
and bear purported regular retail prices (which are in fact fictitious prices and greatly in excess
of the real value of said pens) and further supplies coupons bearing statements to the effect that
for one day only said coupons will be accepted at their face value inn part payment for the
respondent’s pens at said regular retail prices, thus falsely representing that the penis wilt be
sold for a limited the at a substantial reduction in price ; and in that respondent causes certain
of his pen points to be stamped “ 14 K,” thereby indicating that said points are 14-karat gold,
when in fact they are made of an alloy simulating gold in color and appearance but containing
no gold inn substantial quantities, all in alleged violation of section 5 of the Federal Trade
Commission act.
Disposition : After a stipulation, entered in lieu of testimony, the commission entered an order
to cease and desist on June 24, 1925.

(This proceeding, disposed of during the fiscal year 1925, and so recorded in the statistical
tables, was not so recorded In the text of the annual report for that year, as service upon the
parties at Interest had not been effected.)
Complaint No. 1265.--In the matter of Baltimore Paint & Color Works. (Inc.) , a corporation.
Charge: Unfair methods of competition are charged in that the respondent labels certain of its
products as “ Regulation Building Paint,” “Cantonment Paint,” and “Army Building Paint,” in
conjunction with designations which simulate the specification, requisition, or order numbers
appearing

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

on surplus goods sold by the United States Government and commonly used by the War
Department, when in fact the said paint is not surplus paint sold by the United States
Government and is not manufactured in accordance with Army specifications or Government
requirements ; and in that the respondent sold certain of its products in cans or containers of the
regulation standard shape and size of 1 gallon and one-half gallon, respectively, thereby leading
the purchasing public to believe that said cans contained said quantities of paint, when in fact
the respondent’s cans contained, in varying quantities, less than 1 gallon and one-half gallon,
respectively, all in alleged violation of section 5 of the Federal Trade Commission act.
Disposition : After a stipulation, entered in lieu of testimony, the commission entered an order
to cease and desist on June 30, 1925.
(This proceeding, disposed of during the fiscal year 1925, and so recorded in the statistical
tables, was not so recorded in the text of the annual report for that year, as service upon the
parties at interest had not been effected.)
Complaint No. 1268.--In the matter of Ameen Bardwil and George Bardwil, partners doing
business under the trade name and style Bardwil Bros. Charge: Unfair methods of competition
are charged in that the respondents, engaged in the importation of lace from China and the sale
thereof, designates and sells said lace as “Irish” lace, thereby misleading and deceiving the purchasing public as to the quality and value of respondent’s product and tending to injure its
competitors who are In fact importers of Irish lace, in alleged violation of section 5 of the
Federal Trade Commission act.
Disposition: After hearing, the commission entered an order to cease and desist on April 27,
1926.
Complaint No. 1278.--In the matter of John B. Stetson Co.- Charge : Unfair methods of
competition are charged in that the respondent, engaged in the manufacture and sale of hats,
enforced a merchandising system adopted by it of fixing and maintaining certain specified
uniform retail prices for the resale of its hats, refusing to supply price cutters, and employing
cooperative means and methods for the enforcement of said system of resale prices, in alleged
violation of section 5 of the Federal Trade Commission act.
Disposition : After a stipulation entered in lieu of testimony, the commission entered an order
to cease and desist on November 6, 1925.
Complaint No. 1279.--In the matter of Rosenbush & Solomon Co. Charge: Unfair methods
of competition are charged in that the respondent, engaged in the sale of paints, varnishes, and
allied products, labels as “ Orange Shellac” and “ White Shellac” certain varnishes, composed
of shellac gum and various substitutes thereof dissolved in alcohol, wherein shellac gum is not
a principal and predominant element, and fails to indicate the facts except by stamping on said
labels with a rubber stamp the word “ Compound” in small and inconspicuous letters, thereby
tending to mislead and deceive the purchasing public as to the value and quality of respondent’s
products and to injure competitors who label their product properly, in alleged violation of
section 5 of the Federal Trade Commission act.
Disposition: After a stipulation, entered in lieu of testimony, the commission entered an order
to cease and desist on November 6, 1925, Commissioners Nugent and Thompson dissenting for
the reason given in the dissenting opinion in the Don-O-Lac case, Docket 924.
Complaint No. 1297.--In the matter of J. W. Kobi Co. Charge : Unfair methods of competition
are charged in that the respondent, engaged in the manufacture and sale of hair cleansing and
dressing preparations, enforces a merchandising system adopted by it of fixing and maintaining
specified uniform prices for the resale of its products, refusing to supply price cutters and
employing cooperative means and methods for the enforcement of said system of resale prices,
in alleged violation of section 5 of the Federal Trade Commission act.
Disposition: After hearing, the commission entered an order to cease and desist on June 18,
1926. Commissioner Nugent dissenting to the form of the order.

Complaint No. 1302.--In the matter of George E. Watson Co. Charge : Unfair methods of
competition are charged in that the respondent’s “ Monogram” and “ Faultless” paints are
represented and labeled as strictly pure when in fact they contain large quantities of calcium
carbonate and distillates of petroleum in lieu, respectively, of white lead and linseed oil, said
paints containing correspondingly small quantities of white lead and linseed oil ; and in that the
respondent claims to be the manufacturer of said paints when in fact it purchases its paints for
resale; thereby tending to deceive the pur-

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109

chasing public as to quality and manufacture, promoting the belief that persons buying from the
respondent are dealing direct with the manufacturer and saving the profits of middlemen, and
to Injure competitors who do not misrepresent their products or the manufacture thereof, in
alleged violation of section 5 of the Federal Trade Commission act.
Disposition : After a stipulation, entered in lieu of testimony, the commission entered an order
to cease and desist on July 14, 1925.
Complaint No. 1303.--In the matter of Isadore Sommerfield, doing business under the trade
name and style of Dubiner & Sommerfield. Charge: Unfair methods of competition are charged
in that the respondent, engaged In the manufacture of cigars in the State of New York and the
sale thereof, causes the words “Havana,” “Vuelta Abajo,” and “Garcia” to be placed on the
boxes or containers in which his cigars are sold and the word “Garcia” to be placed on the bands
of his cigars, the box labels carrying an outline map of Cuba and inscriptions in the Spanish
language, that the cigar contained in said boxes were made of the best Vuelta Abajo tobacco,
and that the tobacco contained In them was guaranteed to be of the best Havana tobacco when
in fact the respondent’s cigars contained no more than a very small amount of Cuban-grown
tobacco, thereby tending to mislead the purchasing public and to injure competitors who do not
misrepresent their products, in alleged violation of section 5 of the Federal Trade Commission
act.
Disposition : After a stipulation, entered in lieu of testimony, the commission entered an order
to cease and desist on July 17, 1925.
Complaint No. 1304.--In the matter of Reinhart & Newton Co. Charge: Unfair methods of
competition are charged in that the respondent, engaged in the manufacture and sale of candies,
has put into effect a scheme which is intended to induce the consuming public to participate In
a lottery, Its candles for sale at 1 cent each and uniform In appearance being packed In display
boxes with prizes for the purchasers who choose candies which prove to have pink centers
instead of the white or cream-colored centers, found In most of the candies thereby tending to
induce the consuming public to purchase respondent’s candies In preference to the products of
Its competitors who do not give prizes won by chances or otherwise, in alleged violation of
section 5 of the Federal Trade Commission act.
Disposition : A stipulation having been entered In lieu of testimony, the commission entered
an order to cease and desist on April 13, 1926.
Complaint No. 1307.--In the matter of Norman J. Freeman and Myron Lewis, partners doing
business under the trade name and style Ohio Shellac Co. Charge : Unfair methods of
competition are charged In that the respondents, engaged In the sale of certain varnishes
composed of shellac gum and/or various substitutes therefor dissolved In alcohol, wherein
shellac gum Is not the principal and predominant element, label said products as “shellac”
without indicating that shellac gum is not the principal and predominant element of said
varnishes, except that in some instances the word “compound” appears on the labels In small
and Inconspicuous letters, the respondents thereby failing to abide by the terms of an
undertaking, agreement and stipulation heretofore entered Into with the Federal Trade
Commission to discontinue the misrepresentation of said products, In alleged violation of
section 5 of the Federal Trade Commission act.
Disposition : After a stipulation, entered In lieu of testimony, the commission entered an order
to cease and desist on October 31, 1925, Commissioner Nugent dissenting for the reason given
in the dissenting opinion in the Don-O-Lac case, Docket 924.
Complaint No. 1309.--In the matter of Chero-Cola Co. Charge : Unfair methods of
competition are charged in that the respondent, engaged in the manufacture of a concentrate
which when mixed with water and charged with carbonic acid gas forms a beverage designated
“Chero-Cola” enforces a system of uniform contracts whereby the respondent seeks to and does
maintain specified uniform prices at which said Chero-Cola is resold by respondent’s bottler

vendees to retailers, thereby tending to suppress competition In the sale of said Chero-Cola and
to deny to the retail trade and consuming public the advantages in price which would obtain
from the natural and unobstructed play of competition in alleged violation of section 5 of the
Federal Trade Commission act.
Disposition : After a stipulation, entered in lieu of testimony, the commission entered an order
to cease and desist on November 7, 1925.

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Complaint No. 1312.--In the matter of B. W. Cooke, C. E. Wesch, Job-Way home Study
(Inc.). Charge: Unfair method of competition are charged in that the respondents, heretofore
doing business as “Coye School of Drafting,” “Associated Drifting Engineers,” and “Chicago
Auto Shops,” conducting a correspondence school course in the art of mechanical and other
form”, of drafting and the trade of repairing automotive vehicles, made numerous and
misleading statements concerning said courses of instruction, the costs thereof, the giving of
tools, appliances, and supplies free of charge, and the results to be expected by pupils, and
unlawfully coerced pupils to pay substantial sums of money claimed to be due and owing under
the terms of fraudulently procured contracts, sending letters under the name of a fictitious
collection agency, and fictitious notices and summonses in simulation of legal documents,
thereby misleading the public and injuring the business of competitors who do not misrepresent
their courses of instruction, in alleged violation of section 5 of the Federal Trade Commission
act.
Disposition : After a stipulation. entered in lieu of testimony, the commission entered an order
to cease and desist on September 21, 1925.
Complaint No. 1318.--In the matter of Louis Shapiro, Barney Shapiro, and Frank B.- Shapiro,
partners doing business under the trade name and style of Shapiro & Sons. Charge : Unfair
methods of competition are charged In that the respondents represent their men’s clothing as
made from all-wool fabrics when In fact the garments sold by the respondents are made from
a fabric containing a substantial amount of material other than wood, thereby tending to mislead
and deceive the purchasing public and to injure competitors who do not practice
misrepresentation, in alleged violation of section 5 of the Federal Trade Commission act.
Disposition : After a stipulation, entered in lieu of testimony, the commission enter an order
to cease and desist oil September 30, 1925.
Complaint No. 1321.--In the matter of Beacon Knitting Mills. Charge : Unfair methods of
competition are charged in that the respondent represents and asserts to its customers and
prospective customers through its salesman and agents, and by means of business stationery,
catalogues, labels, etc., that it controls aud operates knitting mills and is the manufacturer of the
garments in which it deals, thereby eliminating the profits of middlemen, whereas, in fact, It
does not own, control, or operate any mill or factory, in alleged violation of section 5 of the
Federal Trade Commission act.
Disposition : After hearing, the commission entered an order to cease and desist on March 15,
1920
Complaint No. 1333.--In the matter of William F. Schied and H. H. Bard, copartners, doing
business under the trade names and styles of American Specialty Co. and American Seed Co.
Charge: Unfair methods of competition are charged in that the respondents, engaged in the sale
of snap dress fastener’s and vegetable and flower seeds, represent to their agents, a great number
of whom are school children, that the sale of a specified number of packages of fasteners or
seeds and the remission of the amount collected therefor with title the agent to a premium of his
selection, when, in fact, the respondents consignment to the agent includes additional packages
together with a printed statement advising the agent that it is necessary to sell the additional
packages and remit the proceeds in order to insure the delivery of the premium, post-paid
insured, said proceeds being in fact, in excess of the postage requirements; and in that the
respondents represent their seeds as carefully selected and tested by the department of
agriculture of many of the leading States, when. In fact, the respondents do not test their seeds
nor do they have them tested by the department of agriculture of any State ; and, further, in that
the respondents indicate that their seeds were grown in Lancaster County, Pa., which bears the
reputation of being one of the richest agricultural counties in the United States, when. In fact,
none of the seeds sold by the respondents are grown in said county but are purchased from seed
growers in other parts of the United States, all in alleged violation of section 5 of the Federal

Trade Commission act.
Disposition: A stipulation having been entered in lieu of testimony, the commission entered
an order to cease and desist on April 9, 1926.
Complaint No. 1336.--In the matter of Minneapolis Woolen Mills Co. (Inc.). Charge: Unfair
methods of competition are charged in that the respondent by the use of Its corporate name and
by the representations of Its agents mis leads the public to believe that it owns or operates mills
or factories and that

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111

the profits of middlemen are saved by purchasing from it, when, in fact, the respondent fills its
orders from merchandise purchased by it from other manufactures, in alleged violation of
section 5 of the Federal Trade Commission act.
Disposition : After hearing, the commission entered an order to cease and desist on June 7,
1926.
Complaint No. 1349.--In the matter of Ben Kreeger doing business under the trade name and
style of Federal Mall Order Co. Charge : Unfair methods of competition are charged in that the
respondent, in the sale of his wearing apparel, by mail, direct to the consumer, misrepresents the
value of his products and advertises and sells certain of his garments as composed of wool
finished serge and others as composed of Canton crepe genuine silk, when in fact the materials
consist largely of cotton, and describes certain trimmings as genuine astrakhan, astrakhan
caracul, or genuine ermine fur, when In fact said trimmings are imitations, thereby tending to
mislead the purchasing public and to injure competitors who do not practice misrepresentations,
In alleged violation of section 5 of the Federal Trade Commission act.
Disposition : A stipulation having been entered in lieu of testimony, the commission entered
an order to cease and desist on April 12, 1926.
Complaint No. 1365.--In the matter of Western Woolen Mills Co. Charge : Unfair methods
of competition are charged in that the respondent’s use of its it corporate name in its
advertisements and trade literature and on its business stationery and sample cases tends to
promote the belief that the respondent is the manufacturer of its wearing apparel, when In fact
the respondent does not own or operate any mill or mills but purchases its goods for resale,
thereby tending to mislead and deceive the purchasing public and to injure competitors who do
not practice misrepresentation, in alleged violation of section 5 of the Federal Trade
Commission act.
Disposition : A stipulation having been entered in lieu of testimony, the commission entered
an order to cease and desist on June 8, 1926.
Complaint No. 1370.--In the matter of Lauer & Suter Co. Charge : Unfair methods of
competition are charged in that the respondent’s “Beauty Package” of candies is composed of
a number of chocolate covered pieces of candy of uniform size and shape, which are sold at
retail at one cent each, together with a number of larger pieces of candy which are to be given
as prizes to the purchasers who by chance select a piece of candy having a colored center, the
respondent thereby supplying to and placing in the hands of retailers the means of conducting
a lottery and tending to injure competitors who do not use lottery methods in the sale of their
candies, in alleged violation of section 5 of the Federal Trade Commission act.
Disposition: A stipulation having been entered in lieu of testimony, the commission entered
an order to cease and desist on June 1, 1926.
2. ORDERS OF DISMISSAL
NOTE.--On or immediately before June 30, 1926, the commission mailed four orders of
dismissal in addition to those shown below. This action is properly reflected in the statistical
tables, but not individually indicated because service upon parties at interest had not been
effected at the close of the fiscal year.
Complaint No. 163.--In the matter of Armour & Co. Charge : Stilling and suppressing
competition in the manufacture and sale of dairy products by concealing its control of and
affiliation with Beyer Bros. Co., a creamery company, while directing the efforts and business
of said company ; discriminating in prices paid for butterfat or cream ; and by purchasing and
offering to purchase butterfats or cream in certain localities at prices unwarranted by trade

conditions and so high as to be prohibitive to small competitors, in alleged violation of section
5 of the Federal Trade Commission act.
Disposition : Dismissed, practices charged having been discontinued.
Complaint No. 449.--In the matter of Wilson & Co. (Inc.). Charge: That the respondent
purchased all the property of the Morton Gregson Co., a Nebraska corporation, theretofore
engaged in the same name of business as respondent and in active competition with it. and
thereafter organized under the laws of the State of Delaware a subsidiary corporation called the
“ Morton Gregson Co.,” which proceeded to take over the property thus purchased and to
operate the business of the said Nebraska corporation, with the effect or eliminating competition
previously existing be tween Morton Gregson Co., the Nebraska corporation, and the
respondent, in alleged violation of section 5 of the Federal Trade Commission act and section
7 of the Clayton Act.
Disposition : Dismissed.

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Complaint No. 450.--In the matter of Wilson & Co. ( Inc.). Charge : That the respondent
acquired the whole of the common or voting stock of the Paul O. Reyman Co., a corporation,
the effect of such acquisition being to enable respondent to completely dominate the business
and policy of said Paul O. Reyman Co., to restrain competition between said respondent and
said Paul O. Reyman Co., and to tend to create a monopoly In the sale of meats and like
products, in alleged violation of section 5 of the Federal Trade Commission act and section 7
of the Clayton Act.
Disposition : Dismissed after hearing, respondent company having divested itself of the stock
alleged to have been unlawfully acquired, under an order of the United States District Court for
the Southern District of New York.
Complaint No. 451.--In the matter of The Cudahy Packing Co. Charge : That respondent
acquired 55 per cent of the shares of capital stock of the Nagel Packing Co., a competitor; 95
per cent of the capital stock of the D. E. Wood Butter Co., a competitor; and that a subsidiary
corporation, the Dow Cheese Co., purchased the business and good will of a competitor, the A.
C. Dow Co., with the effect that respondent has dominated the business of the Nagel Packing
Co. and the D E. Wood Butter Co., and has eliminated competition theretofore existing between
the three above-mentioned companies and the respondent, in alleged violation of section 5 of
the Federal Trade Commission act and section 7 of the Clayton Act.
Disposition: Dismissed after hearing, Commissioners Nugent and Thompson dissenting in so
far as the dismissal relates to the D E. Wood Butter Co. and the Dow Cheese Co.
Complaint No. 452.--In the matter of Morris & Co. Charge: That the respondent acquired
approximately 75 per cent of the capital stock of the Crescent City Stock Yard & Slaughter
House Co., a competitor; that it acquired stock in the Bluefield Produce & Provision Co.; that
it acquired the whole of the capital stock of the Holland Butterine Co., and held the same out
to the public as wholly independent and without connection with respondent that it acquired 66
per cent of the common stock of the Providence Churning Co., a competitor, and organized a
corporation to take over and succeed to the business and property of said Providence Churning
Co.; that it acquired one-half of the entire capital stock of the Eskerson Co., a competitor ; that
it acquired one-half of the capital stock of the Jacob Marty Co., a competitor; that It acquired
one-half of the capital stock of the C. A. Straubel Co., a competitor; and acquired $64,300 of
the capital stock of the Sherman). White Co., whose entire stock was $123,700 ; and that the
result of such acquisition is the domination by respondent of some of the above-mentioned
companies, the elimination of competition theretofore existing between the above-mentioned
companies and the respondent, aud the creation of conditions which tend to create a monopoly,
in alleged violation of section 5 of the Federal Trade Commission act aud section 7 of the
Clayton Act.
Disposition : Dismissed after hearing, respondent having gone out of business.
Complaint No. 454.--In the matter of Swift & Co., and United Dressed Beef Co. Charge: That
the respondent caused Its subsidiary, United Dressed Beef Co., to acquire all of the capital stock
of J. J. Harrington & Co. (Inc.) , which acquisition resulted In the control by Swift & Co. of the
business theretofore conducted and controlled by said J. J. Harrington & Co. (Inc.), elimination
of competition between respondents, Swift & Co. aud United Dressed Beef Co. and J. J.
Harrington & Co. (Inc.), and a tendency to create for respondent, Swift & Co., a monopoly in
alleged violation of section 5 of the Federal Trade Commission act and section 7 of the Clayton
Act.
Disposition : Dismissed after hearing.
Complaint No. 531.--In the matter of Armour & Co. Charge : Organizing apparently

independent companies for the purpose of taking over the business and property of the Lookout
Refining Co. and the Chattanooga Oxygen Gas Co. and the Harris Tannery Co., competitors of
respondent, the capital stock of the independent companies being held by officers and
employees or agents of respondents with the purpose or effect of restraining and eliminating
competition and tending to create a monopoly, in alleged violation of section 5 of the Federal
Trade Commission act and section 7 of the Clayton Act.
Disposition: Counts 1 and 2 dismissed after hearing, for the reason that the competition
eliminated was due to the acquisition of physical assets rather than the subsequent acquisition
of capital stock ; counts 3 and 4 dismissed after hearing, for the reason that under the evidence
the acquisition was not a viola-

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113

tion of the Clayton Act and the proof was insufficient to establish a violation of the Federal
Trade Commission act, Commissioners Nugent and Thompson dissenting.
Complaint No. 540.--In the matter of Royal Baking Powder Co. Charge: Using unfair
methods of competition by unfairly representing and charging that its competitors’ products
contain alum, to wit, sodium aluminum sulphate (SaS), and are harmful, unhealthful, deleterious,
and dangerous to users and consumers of such baking powders, in alleged violation of section
5 of the Federal Trade Commission act.
Disposition: Dismissed after hearing, Commissioner Humphrey dissenting.
Complaint No. 578.--In the matter of Swift & Co., Libby, McNeill & Libby ( of Illinois) and
Libby, McNeill & Libby (Ltd.) (of Honolulu). Charge: That the respondent, Libby, McNeill &
Libby, in effect a subsidiary of the respondent, Swift & Co., acquired all of the share capital of
the Thomas Pineapple Co.; the share, capital, property, and business of the Honolulu Pineapple
Co.; Kahaluu Pineapple & Range Co. (Ltd.); and Koolau Fruit Co. (Ltd.), with the effect of
substantially lessening competition in the sale of pineapples in the Territory of Hawaii and
creating a condition which tended to create for respondents a monopoly in the growing and sale
of pineapples, In alleged violation of section 7 of the Clayton Act and section 5 of the Federal
Trade Commission act.
Disposition: Dismissed after hearing, Commissioners Nugent and Thompson dissenting.
Complaint No. 726.--In the matter of Constantine Calevas, Joseph Garcia, aud E. A. Pilier,
partners, styling themselves Garcia, Piller & Co., and Calevas Bros. Charge: Using unfair
methods of competition In the sale of ship chandlery, including stewards’ supplies, deck, engine,
and cabin supplies, by giving to captains and other officers of vessels valuable gifts, cash
commissions, and gratuities to Induce them to purchase supplies from the respondents, In
alleged violation of section 5 of the Federal Trade Commission act.
Disposition : Dismissed after hearing.
Complaint No. 746.--In the matter of W. J. Chapman. Charge : Using unfair methods of
competition by offering and giving to captains of vessels cash gratuities to induce them to
purchase ship chandlery, stewards’ supplies, deck, engine, and cabin supplies from the
respondent, in alleged violation of section 5 of the Federal Trade Commission act.
Disposition : Dismissed after hearing.
Complaint No. 786.--In the matter of Kelly Dry Dock & Ship Building Co. (Inc.-). Charge:
Using unfair methods of competition by offering and giving to officers and other employees of
vessels, without the knowledge and consent of their employers, cash commissions and gratuities
as an inducement to have their vessels repaired and repair parts furnished by the respondent, in
alleged violation of section 5 of the Federal Trade Commission act.
Disposition : Dismissed after hearing.
Complaint No. 798.--In the matter of Osa J. Smyths and S. W. Levy, partners, styling
themselves Smyths & Levy. Charge: Unfair methods of competition in that the respondent,
engaged in the sale of ship chandlery, has given cash commissions and gratuities of various
kinds to captains, officers, and employees of ships to induce them to purchase ship-chandlery
supplies from the respondents, all in alleged violation of section 5 of the Federal Trade
Commission act. Disposition : Dismissed after hearing, without prejudice.
Complaint No. 800.--In the matter of Herbert W. Brand, Harry C. Oppenheimer, and Edwin
W. Brand, partners, doing business under the name and style of Brand & Oppenheimer. Charge:
Unfair methods of competition are charged in that respondents, engaged in the manufacture and
sale of cotton lining material, advertise and label their product as “ Silkette,” thereby deceiving
and misleading the purchasing public into the belief that their linings are partly or wholly

composed of silk, in alleged violation of section 5 of the Federal Trade Commission act. Order
of dismissal issued May 18, 1923, was revoked, and May 14, 1924, case reopened for further
consideration.
Disposition: Dismissed after hearing and stipulation, Commissioner Thompson dissenting.
Complaint No. 804.--In the matter of Maritime Co. (Inc.). Charge: Unfair methods of
competition in offering aud giving to captains, engineers, and other officers of vessels, without
the knowledge of their employers, as an inducement to have their vessels cleaned, painted, and
repaired by the respondent, lavish entertainment, including automobile, dinner, and theater
parties, lodging accom-

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modations, and for other forms of entertainment are in alleged violation of section 5 of the
Federal Trade Commission act.
Disposition: Dismissed after hearing.
Complaint No. 821.--In the matter of Liberty Iron & Wire Co. (Inc.). Charge: Unfair methods
of competition in offering and giving to captains, engineers, and other officers of vessels,
without the knowledge of their employers, as an inducement to have their vessels repaired and
repair parts furnished by the respondent, money and lavish entertainment, including auto mobile
parties, dinner and theater parties, lodging accommodations, and forms of amusement, in alleged
violation of section 5 of the Federal Trade Commission act.
Disposition : Dismissed.
Complaint No. 828.--In the matter of A. D. Davis Packing Co. Charge: Unfair methods of
competition in offering and giving to officers and employees of vessels, without the knowledge
of their employers, as an inducement to have their vessels provisioned by respondent, lavish
entertainment, in alleged violation of section 5 of the Federal Trade Commission act.
Disposition: Dismissed after hearing.
Complaint No. 833.--In the matter of John J. Morrill and Louis Halvarson, partners, styling
themselves A. Mcleod & Co. Charge : The respondents have offered and given cash
commissions and gratuities to captains, engineers, and other officers or employees of vessels
without the knowledge of their employers to induce the purchase of sails, rigging, and canvas
equipment from respondent, in alleged violation of section 5 of the Federal Trade Commission
act.
Disposition: Dismissed after hearing, without prejudice.
Complaint No. 911.--In the matter of Milwaukee Tobacco Jobbers’ Association and P.
Lorillard Co. (Inc.), respondents. Charge : The charge is unfair competition in that the
association and its members agreed upon a schedule of fixed prices at which the members
should resell tobacco products to their dealer customers and that the P. Lorillard Co. (Inc.)
entered into an agreement with the association and its members to assist them in maintaining the
prices fixed and agreed upon all in alleged violation of section 5 of the Federal Trade Commission act.
Disposition: Dismissed after hearing as to P. Lorillard Co. (Inc.); dismissed after hearing as
to the other respondents, without prejudice to future action by the commission should the
practices complained of or practices similar thereto be resumed by said other respondents, or
by any of them, Commissioners Nugent and Thompson dissenting to the dismissal as to all
respondents.
Complaint No. 915.--In the matter of Cutler-Hammer Manufacturing Co. Charge : Unfair
methods of competition In commerce are charged in that the respondent practices discrimination
in prices in the sale of its electric controllers by granting a greater rate of discount from the list
price to those of Its vendees who accept the respondent’s “sole use contract” whereby the
vendee agrees to purchase the respondent’s controllers only the effect of said practice being to
substantially lessen competition and to create a monopoly, in alleged violation of section 2 and
section 3 of the Clayton Act.
Disposition : Dismissed after hearing, Commissioner Humphrey dissenting.
Complaint No. 916.--In the matter of Trigg, Dobbs & Co. and others. Charge: The
respondents, Chattanooga Wholesale Tobacco Dealers, are charged with unfair competition in
that they entered into an agreement, understanding, and conspiracy by which they fixed a
schedule of prices at which they would thereafter resell to their dealer customers, all in alleged
violation of section 5 of the Federal Trade Commission act.

Disposition: Dismissed after hearing, without prejudice to future action by the commission,
should the practices complained of or practices similar thereto be resumed by the respondents
or by any of them. Commissioner Nugent dissenting.
Complaint No. 964.--In the matter of Standard Oil Co. of New Jersey. Charge : Unfair
methods of competition are charged in that the respondent acquired one-half or more of the
stock or share capital of the Humble Oil & Refining Co., the effect of such acquisition being to
substantially lessen competition between the said Humble Oil & Refining Co. and the
respondent and Its subsidiary, the Standard Oil Co. of Louisiana, to restrain commerce in those
sections in which said companies are engaged in commerce and to create a monopoly In alleged
violation of section 7 of the Clayton Act.

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Disposition: Dismissed after hearing, Commissioners Nugent and Thompson dissenting.
Complaint No. 967.--In the matter of Tobacco Products Corporation and Midwest Tobacco
Jobbers’ Association, respondents. Charge: That the respondent association and the Tobacco
Products Corporation entered into all agreement, understanding, and conspiracy by which they
fixed the price at which the members of the respondent association should resell the products
of the Tobacco Products Corporation, and that the Tobacco Products Corporation agreed to
assist in the carrying out of the conspiracy by discontinuing the sale of its products to such
members of the association as would sell such product at prices less than those fixed by the
conspiracy, all in alleged violation of section 5 of the Federal Trade Commission act.
Disposition: Dismissed without prejudice after hearing. Commissioners Nu gent and
Thompson dissenting.
Complaint No. 968.--In the matter of Scotten-Dillon Co. and Midwest Tobacco Jobbers’
Association, respondents. Charge: That the respondent association and Scotten-Dillon Co.
entered an agreement, understanding, and conspiracy by which they fixed the price at which the
members of the respondent association should resell the products of Scotten-Dillon Co., and that
Scotten-Dillon Co. agreed to assist in the carrying out of the conspiracy by discontinuing the
sale of its products to such members of the association as would sell such products at prices less
than those fixed by the conspiracy, all in alleged violation of section 5 of the Federal Trade
Commission act.
Disposition : Dismissed without prejudice after hearing, Commissioners Nu gent and
Thompson dissenting.
Complaint No 976.--In the matter of Goodall Worsted Co. and Albert Rohaut. Charge: Unfair
methods of competition in commerce are charged in that the respondent corporation, a
manufacturer of Palm Beach cloth, and its sales agents, the respondent Rohaut, fixed uniform
and minimum prices, thereby tending to unduly restrain the natural flow of commerce and be
sold to jobbers and dealers and enforce said standard prices by the use of a license agreement
with the manufacturers of Palm Beach clothing by refusing to sell such cloth to manufacturers
who fail to observe and maintain said resale prices thereby tending to unduly restrain the natural
flow of commerce and freedom of competition in alleged violation of section 5 of the Federal
Trade Commission act.
Disposition : Dismissed.
Complaint No. 985.--In the matter of P. Lorillard Co. (Inc.) , and the Tobacco Jobbers
Association of Western Pennsylvania, its officers and members, respondents. Charge : That the
respondent association and the P. Lorillard Co. (Inc.) entered into a conspiracy, agreement, and
understanding, by which they fixed resale prices of tobacco products of the P. Lorillard Co.
handled by the members of the respondent association, and that the P. Lorillard Co. (Inc.) agreed
to assist in the accomplishment of the conspiracy by agreeing to discontinue selling to such
members of the association as would sell the products of the P. Lorillard Co. (Inc.) at prices less
than those fixed by the conspiracy, all in alleged violation of section 5 of the Federal Trade
Commission act.
Disposition : Dismissed without prejudice, Commissioners Nugent and Thompson
dissenting.
Complaint No. 991.--In the matter of Iowa-Nebraska-Minnesota Wholesale Grocers’
Association, its officers. members of executive committee, and all of its members; SlocumBergen Co.; Gowan-Lenning-Brown Co.; Peet Bros. Manufacturing Co.; Jas. S. Kirk & Co.; and
Cudahy Packing Co. Charge: The complaint charges unfair methods of competition in that the
respondents adopted a plan of hampering, obstructing, and preventing the Proctor & Gamble

Distributing Co., which quotes equal prices to wholesalers and retailers, from selling soaps. soap
products, and cooking fats to the members of the respondent association and wholesale grocers,
and sought to coerce wholesalers into refraining from dealing in the said products of the Proctor
& Gamble Distributing Co., in alleged violation of section 5 of the Federal Trade Commission
act.
Disposition : Dismissed after hearing, Commissioner Nugent dissenting.
Complaint No. 1009.--In the matter of Illinois Glass Co. Charge : Unfair methods of
competition are charged in that the respondent, engaged in the manufacture and sale of glass
bottles, entered into and carried out an agreement by the effect of which the respondent acquired
the entire assets and

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capital stock of the Cumberland Glass Manufacturing Co., the More Jonas Glass Co., and the
Mintola Glass Co., thereby tending to substantially lessen competition, restrain commerce, and
create a monopoly, in alleged violation of section 5 of the Federal Trade Commission act and
section 7 of the Clayton Act.
Disposition: Dismissed, Commissioners Nugent and Thompson dissenting.
Complaint No. 1012.--In the matter of Ohio Wholesale Grocers’ Association, Cleveland
Tobacco Jobbers, and P. Lorillard Co. (Inc.), respondents. Charge: The charge is unfair
competition in that the Ohio Wholesale Grocers’ Association and a group of Cleveland, Ohio,
tobacco jobbers, and P. Lorillard Co. (Inc.), entered into a conspiracy, agreement, and
understanding, by which they fixed the prices at which the products of P. Lorillard Co. (Inc.),
should be resold by the jobber respondents, and that P. Lorillard Co. (Inc.), agreed with the
other respondents to assist in the carrying out of the conspiracy alleged, by refusing to sell to
such of the respondents as would resell its products at prices less than those fixed by the
conspiracy. All in alleged violation of section 5 of the Federal Trade Commission act.
Disposition: Dismissed without prejudice, Commissioners Nugent and Thompson dissenting.
Complaint No. 1015.--In the matter of William R. Warner & Co. (Inc.). Charge: Unfair
methods of competition are charged in that the respondent, having established two scales of
prices for Its patent medicines, pharmaceuticals, and drug specialties designated, respectively,
as jobbers’ prices and retailers’ prices, makes a regular practice of selling its products at said
jobbers’ prices to certain selected wholesalers and retailers; at the same time and irrespective
of quantity purchased charges the higher retailers’ prices to other wholesalers and retailers,
thereby discriminating between its two classes of customers and giving preferred wholesalers
and retailers an unfair advantage over competitors, who are compelled to purchase the
respondent’s goods of the same quality and quantity at higher prices and on less advantageous
terms, tending to hinder and lessen competition, in alleged violation of section 5 of the Federal
Trade Commission act and section 2 of the Clayton Act.
Disposition: Dismissed.
Complaint No. 1033.--In the matter of Liggett & Myers Tobacco Co., Conference of
Wholesale Tobacco Dealers of Oregon, and others, respondents. Charge: The respondents
joined in its complaint with the Liggett & Myers Tobacco Co. and groups of tobacco jobbers
and wholesale grocers located in numerous localities along the Pacific coast. The charge is that
each group and the Liggett & Myers Tobacco Co., conspired to fix resale prices on Liggett &
Myers Tobacco Co.’s products sold by the members of such groups and that each of the groups
agreed with each and every one of the other groups and with the Liggett & Myers Tobacco Co.
to adhere to the prices fixed by the Liggett & Myers Tobacco Co. and each of such of the other
groups, and that the Liggett & Myers Tobacco Co. offered each of the groups to assist in the
conspiracies by refusing to continue selling to such jobber as would resell its products at prices
less than those fixed by the conspiracies aforesaid, all in alleged violation of the Federal Trade
Commission act.
Disposition: Dismissed without prejudice after hearing, Commissioners Nugent and
Thompson dissenting.
Complaint No. 1034.--In the matter of Liggett & Myers, Keystone Tobacco Jobbers
Association, its officers and members, and the Central Pennsylvania Tobacco Jobbers’
Association, its officers and members, respondents. Charge: The charge is unfair competition
in that Liggett & Myers Tobacco Co. and the Keystone Tobacco Jobbers’ Association by
conspiracy fixed prices at which the members of that association should resell the products of
the Liggett & Myers Tobacco Co; that the Central Pennsylvania Tobacco Jobbers’ Association

entered into a similar conspiracy with the Liggett & Myers Tobacco Co.; that each association
agreed to abide by the prices of the other association when its members sold into territory of the
members of such other associations and that the Liggett & Myers Tobacco Co. agreed with both
of the associations to assist in the carrying out of the several conspiracies by discontinuing to
sell such members of the associations as would sell its products at prices less than those fixed
by the conspiracies aforesaid.
Disposition: Dismissed without prejudice, Commissioners Nugent and Thompson dissenting.
Complaint No. 1035.--In the matter of Larus Bros. Co., Keystone Tobacco Jobbers’
Association, its officers and members, and the Central Pennsylvania Tobacco Jobbers’
Association, its officers and members, respondents. Charge:

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The charge is unfair competition in that Larus Bros. Co. and the Keystone Tobacco Jobbers’
Association, by conspiracy, fixed prices at which the members of that association should resell
the products of Larus Bros. Co.; that the Central Pennsylvania Tobacco Jobbers’ Association
entered into a similar conspiracy with Larus Bros. Co.; that each association agreed to abide by
the prices of the other association when Its members sold into territory of the members of such
other association, and that Larus Bros. Co. agreed with both of the associations to assist in the
carrying out of the several conspiracies by discontinuing to sell such members of the association
as would sell its products at prices less than those fixed by the conspiracies aforesaid.
Disposition: Dismissed without prejudice, Commissioners Nugent and Thompson dissenting.
Complaint No. 1037.--In the matter of P. Lorillard Co. (Inc.), a corporation; Keystone
Tobacco Merchants’ Association, an unincorporated organization; its officers, J. C. Lindner,
president; E. A. Stroud, vice president; I. Finkelstein, treasurer; W. F. Smulyan, secretary; their
successors and its members; Central Tobacco Jobbers’ Association of Pennsylvania, an
unincorporated organization, its officers, G. H. Stallman, president; Jacob L. Hauer, vice
president; W. Clyde Shissler, secretary and treasurer; their successors and Its members. Charge:
Unfair methods of competition are charged in that the respondents conspired and agreed to fix
uniform prices for the sale and resale of cigars, cigarettes, and other tobacco products, the
respondent, P. Lorillard Co. (Inc.), refusing to sell its products to those who did not maintain
said standard resale prices or resold products to price-cutting subjobbers and retailers, all for
the purpose and with the effect of restricting competition and restraining the natural flow of
commerce in violation of section 5 of the Federal Trade Commission act.
Disposition: Dismissed without prejudice, Commissioners Nugent and Thompson dissenting.
Complaint No. 1051.--In the matter of Manhattan Shirt Co. Charge: Unfair methods of
competition are charged in that the respondent, engaged in the manufacture and sale of shirts,
underwear, and pajamas, employs a merchandising plan or policy by which It establishes certain
specified standard resale prices at which its product shall be resold by retailers, refuses to sell
to price cutters, and employs other cooperative means for the enforcement of said standard
prices, in alleged violation of section 5 of the Federal Trade Commission act.
Disposition: Dismissed after hearing.
Complaint No. 1071.--In the matter of P. Lorillard Co. (Inc.), a corporation; New England
Tobacco Conference, its officers and officers of the various sections and the members thereof.
Charge: Unfair methods of competition are charged in that the respondents conspired and agreed
to fix uniform prices for the sale and resale of cigars, cigarettes, and other tobacco products, the
respondent, P. Lorillard Co. (Inc.), refusing to sell its products to those who did not maintain
said standard resale prices or resold said products to price-cutting subjobbers and retailers, all
for the purpose and with the effect of restricting competition and the natural flow of commerce,
in alleged violation of section 5 of the Federal Trade Commission act.
Disposition: Dismissed without prejudice, Commissioners Nugent and Thompson
dissenting.
Complaint No. 1072.--In the matter of Joseph P. Manning Co. Charge: Unfair methods of
competition are charged in that respondent, doing business as a “Cash and Carry Tobacconist,”
discriminates In price between different purchasers of tobacco and tobacco products, not
because of difference In grade, quality, or quantity, but with the purpose, intent, and effect of
forcing competitors out of business or to force said competitors to agree to maintain certain
prices established by the respondent and other wholesalers, thereby tending to substantially
lessen competition in the territory served by the respondent, in alleged violation of section 5 of
the Federal Trade Commission act.

Disposition: Dismissed, Commissioner Thompson dissenting.
Complaint No. 1082.--In the matter of Coast States Oil Co., a corporation, J. C. Van Slyke,
L. Chair Van Slyke, W. H. Labofish, J. W. Hood. Charge: Unfair methods of competition are
charged in that the respondents, to further the sale of the corporate stock of the respondent
corporation, made numerous false, misleading, and deceptive statements as to the properties,
prospects, and management of said corporation, in alleged violation of section 5 of the Federal
Trade Commission act.
Disposition Dismissed, respondent having gone out of business.

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Complaint No. 1101.--In the matter of Oneida Community (Ltd.). Charge: Unfair methods of
competition are charged in that the respondent employs a system of fixing and maintaining
specified standard prices for the resale of its silver-plated flatware and uses numerous
cooperative means and methods for the enforcement of said standard prices, thus tending to
obstruct the free and natural flow of commerce and to establish an arbitrary price, in alleged
violation of section 5 of the Federal Trade Commission act.
Disposition: Dismissed after hearing, practices charged having been discontinued a short the
after the decision of the Supreme Court of the United States in the Beech-Nut Packing Co. case.
which settled the law with respect to the maintenance of prices by cooperative methods.
Complaint No. 1117.--In the matter if Kelsey Wheel Co. (Inc.); Jacob Mattern & Sons (Inc.);
Standard Tire & Rubber Co. ; William H. Johnson, trading as Johnson Wheel Co.; H. O. Norris,
trading as R. W. Norris & Sons Co.; Motor Rim & Wheel Manufacturing Co.; The Motor Rim
Manufacturers Co.; Keaton Tire & Rubber Co. Charge: Unfair methods of competition are
charged in that the respondent manufacturer and the respondent distributors have combined and
cooperated to maintain and enhance prices and suppress competition in the distribution and sale
of their automobile wheels and parts by means of a system of fixed retail prices and trade
discounts in connection with restrictive territorial contracts and arrangements, employing
cooperative methods for the maintenance of said prices and arrangements, in alleged violation
of section 5 of the Federal Trade Commission act.
Disposition : Dismissed.
Complaint No. 1119.--In the matter of John Blocki & Son (Inc.) A. T. Renck and Ada A.
Renck, partners doing business under the name and style A. & A. Renck ; B. F. Coleman and
Maude W. Humphrey, partners doing business under the name and style Coleman & Humphrey;
Opal Eckhoff, Martha Abel, Bess Freeman, Mary Elizabeth Hall, Tress Welsh. Charge: Unfair
methods of competition are charged in that the respondent John Blocki & Son (Inc.) engaged
in the manufacture of perfumes and toilet articles and the sale thereof to respondent distributors,
fixed specified uniform prices for resale of its products, and in cooperation with said distributors
employed a system of enforcing and maintaining said resale prices ; and in that the respondent
took into its employ certain employees and distributors of the Franco-American Hygienic Co.,
a competitor sales company, which had therefore been supplied with the respondent’s products
to be sold under the trade name “Franco-American,” and thereupon sold the Blocki products to
the public as and for the goods of said competitor, also seeking to induce the customers of said
competitor to abandon the use of the products of the competitor company and to adopt and use
the products of the respondent manufacturer, to this end making numerous false, misleading, and
unfair representations as to said competitor, all in alleged violation of section 5 of the Federal
Trade Commission act.
Disposition: Dismissed.
Complaint No. 1123.--In the matter of Real Silk Hosiery Mills, a corporation. Charge: Unfair
methods of competition are charged in that the respondent makes numerous misleading
statements through its salesmen and advertisements as to the production and quality of its
hosiery, falsely representing that such hosiery is “fashioned” and indicating that it is wholly
composed of silk, when in fact the top, toe, and heel are made of cotton and the sole is made of
a mixture of cotton and silk, all in alleged violation of section 5 of the Federal Trade
Commission act.
Disposition: Dismissed after hearing, for lack of public interest, respondent having stipulated
that practices complained of had been discontinued and would not be resumed, Commissioner
Thompson dissenting.

Complaint No. 1132.--In the matter of Firestone Steel Products Co., Jacob Mattern & Sons
(Inc.), Motor Rim Manufacturers Co., Motor Rim & Wheel Manufacturing Co., Keaton Tire &
Rubber Co., Standard Tire & Rubber Co., Phineas Jones & Co., Eastern Rim & Wheel Co., and
H. O. Norris trading as R. W. Norris & Sons Co. Charge: Unfair methods of competition are
charged In that the respondent manufacturer, Firestone Steel Products Co., and Its distributors,
the remaining respondents. have combined and cooperated to maintain and enhance prices and
suppress competition in the distribution and sale of their automobile wheel rims and rim parts
by means of a system of fixed retail prices and trade discounts in connection with restrictive
territorial contracts and arrangements, employing cooperative methods for the main-

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119

tenance of said prices and arrangements, in alleged violation of section 5 of the Federal Trade
Commission act.
Disposition: Dismissed after stipulation, practices charged having been discontinued
Immediately following the decision of the Supreme Court of the United States in the Beech-Nut
Packing Co. case.
Complaint No. 1140.--In the matter of Cleveland Metal Products Co. Charge: Unfair methods
of competition are charged In that the respondent enforces a merchandising system by which
certain specified uniform prices are fixed and maintained for the resale of its stoves and beaters
by retail dealers, the respondent refusing to supply price cutters and employing cooperative
methods for the enforcement of said standard resale prices, thereby tending to suppress
competition and to deprive ultimate purchasers of the advantages they would obtain from the
natural and unobstructed flow of commerce in such commodities, in alleged violation of section
5 of the Federal Trade Commission act.
Disposition: Dismissed after hearing practices charged having been discontinued it short the
after the decision of the Supreme Court of the United States in the Beech-Nut Packing Co. case.
Complaint No. 1151.--In the matter of Robert Lewis, an individual doing business under the
trade name and style Great Eastern Wholesale Furniture Co. Charge: Unfair methods of
competition are charged in that the respondent retailer falsely advertises that his furniture is sold
at wholesalers’ prices, thereby tending to mislead the purchasing public into the belief that
middlemen’s profits are saved to the respondent’s customers; and in that the respondent
advertises and offers certain of his furniture as “walnut” when in fact said furniture is made of
woods other than walnut and in mutation of genuine walnut wood, all in alleged violation of
section 5 of the Federal Trade Commission act.
Disposition: Dismissed after hearing for lack of jurisdiction.
Complaint No. 1154.--In the matter of L. Pincus and Benjamin Blaustein, partners doing
business under the trade names Louben Furniture Co. and the Big G Furniture Warehouse.
Charge: Unfair methods of competition are charged in that the respondent retailers falsely
indicate that they are the manufacturers of the furniture which they in fact buy for resale, and
in that they advertise certain of their furniture as “mahogany” or “walnut” or “genuine blue
leather” or “imperial leather,” when in fact said furniture is made of woods other than mahogany
or walnut or is covered or upholstered with materials other than leather, said materials being in
imitation of genuine mahogany, walnut, or loather, respectively, thereby tending to mislead the
purchasing public as to the price and quality, in alleged violation of section 5 of the Federal
Trade Com mission act.
Disposition: Dismissed, respondent having gone out of business.
Complaint No. 1172.--In the matter of Crescent Manufacturing Co. Charge: Unfair methods
of competition are charged In that the respondent, engaged in t ho manufacture and sale of food
and grocery products, has adopted a merchandising system of fixing and maintaining certain
specific uniform prices for the resale of Its products, refusing to supply price-cutters and
employing cooperative means and methods to compel the maintenance of said fixed retail prices,
In alleged violation of section 5 of the Federal Trade Commission act.
Disposition: Dismissed after hearing. Commissioner Nugent dissenting.
Complaint No. 1176.--In the matter of Waverly Oil Works Co. Charge: Unfair methods of
competition are charged in that the respondent brands and labels its petroleum distillates as
“Tur-min-time” and “ Min-seed-oil,” thereby tending to mislead the purchasing public to
believe that said products contain turpentine or linseed oil, respectively, in alleged violation of
section 5 of the Federal Trade Commission act.

Disposition: Dismissed after stipulation.
Complaint No. 1180.--In the matter of Holly Sugar Corporation, Southern California Sugar
Co., Santa Ana Sugar Co., Alameda Sugar Co., and S. W. Sinsheimer. Charge: It is charged that
the respondent, S. W. Sinsheimer, Is ineligible to act as director of any two or more of the
respondent corporations and that his service in that capacity constitutes a violation of section
8 of the Clayton Act.
Disposition: Dismissed for lack of public interest, Commissioner Nugent dissenting.
Complaint No. 1181.--In the matter of Holly Sugar Corporation. Charge: It is charged that
the respondent by acquiring the stock or share capital of the Southern California Sugar Co.,
Santa Ana Sugar Co., and Alameda Sugar Co.,

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tends to substantially lessen competition, to restrain commerce, and to create a monopoly in
commerce in beet sugar, in alleged violation of section 7 of the Clayton Act.
Disposition: Dismissed after hearing, Commissioners Nugent and Thompson dissenting.
Complaint No. 1182.--In the matter of Holly Sugar Corporation, Southern California Sugar
Co., and E. A. Carlton. Charge: It is charged that the respondent, E. A. Carlton, is ineligible to
act as director of both the respondent corporations and that his service in that capacity
constitutes a violation of section 8 of the Clayton Act.
Disposition: Dismissed for lack of public interest, Commissioner Nugent dissenting.
Complaint No. 1183.--In the matter of Philip Carey Manufacturing Co., Philip Carey Co.,
Waring Underwood Co., Pioneer Asphalt Co., Western Elaterite Roofing Co. Charge: Unfair
methods of competition are charged in that respondents in the manufacture or sale of asphalt
paving joints, entered into combination and undertaking to suppress competition by entering into
uniform license agreements and by establishing and observing uniform prices for the sale of said
product, thereby denying purchasers the advantages in price which they would enjoy under
conditions of mutual and normal competition in alleged violation of section 5 of the Federal
Trade Commission act.
Disposition: Dismissed after hearing.
Complaint No. 118.--In the matter of Interwoven Stocking Co. Charge: Unfair methods of
competition are charged in that the respondent adopted a merchandising system of fixing and
maintaining certain specified uniform prices for the resale of its hosiery, refusing to supply price
cutters and employing cooperative means and methods for the enforcement of said resale prices,
In alleged violation of section 5 of the Federal Trade Commission act.
Disposition: Dismissed after hearing.
Complaint No. 1194.--In the matter of M. H. Powers Co., Inc. Charge: Unfair methods of
competition are charged in that respondent, engaged in the resale of furniture which he has
purchased for the most part from manufacturers other than those of Grand Rapids, Mich., falsely
advertises that he is a sales agent for furniture manufacturers of Grand Rapids, Mich., thus
tending to mislead the purchasing public into the belief that in dealing with respondent they are
buying direct from the manufacturer and saving the profits of middlemen, in alleged violation
of section 5 of the Federal Trade Commission act.
Disposition: Dismissed after hearing for lack of jurisdiction in the absence of interstate
commerce.
Complaint No. 1195.--In the matter of Nathan Tannebaum, trading as Capitol Furniture
Distributing Co. Charge: Unfair methods of competition are charged, in that respondent,
engaged in the resale of furniture which he has purchased for the most part from manufacturers
other than those of Grand Rapids, Mich., falsely advertises that he is a sales agent for furniture
manufacturers of Grand Rapids, Mich., together with statements to the effect that furniture
buyers save 40 to 50 per cent by buying direct from the manufacturer, thus tending to mislead
the purchasing public into the belief that in dealing with respondent they are buying direct from
the manufacturer and saving the profits of middlemen, in alleged violation of section 5 of the
Federal Trade Commission act.
Disposition: Dismissed after hearing.
Complaint No. 1197.--In the matter of Northern Jobbers’ Club, Walter H. Gander,
individually and as president of said club, Leland Joannes, individually and as secretarytreasurer of said club, Glass-Turbush Co., Otto L. Kuehn & Co., the Zinke Co., Bemis Hooper
Hays Co., F. B. Ives Co., S. C. Shannon Co., J. F. Rapph Co., the Copps Co., Wilson Mercantile
Co., Marshfleld Grocer Co., Booth Newton Co., Joannes Bros. Co., Frank C. Schilling Co.,

Brelling Innes Co., National Grocer Co., Cannon Grocery Co., Roach & Seeber Co., the Peninsula Wholesale Grocery Co., Carpenter-Cook Co. Charge: Unfair methods of competition are
charged, in that respondents have agreed to confine the distribution of groceries and allied
products to “regular” and “legitimate” channels of trade, to wit, from the producer or
manufacturer to the wholesaler, from the wholesaler to the retail dealer, and to fix uniform
wholesale prices and to prevent price cutting, the said agreement, enforced by intimidation,
coerce, and boycotting, tending to suppress and under competition and to

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obstruct the natural flow of commerce, in alleged violation of section 5 of the Federal Trade
Commission act.
Disposition: Dismissed after hearing, practices charged having been discontinued.
Complaint No. 1213.--In the matter of Landers, Frary & Clark, a corporation. Charge: Unfair
methods of competition are charged in that the respondent enforced a merchandising system
adopted by it of fixing and maintaining certain specified uniform prices for the resale of its
electrical heating and cooking appliances, employing cooperative means and methods for the
enforcement of said system of standard prices, thereby tending to deprive the ultimate
purchasers of the advantage in price which would obtain from the natural flow of commerce in
said products under the conditions of free competition, in alleged violation of section 5 of the
Federal Trade Commission act.
Disposition: Dismissed after hearing, Commissioner Nugent dissenting.
Complaint No. 1214.--In the matter of The American Tobacco Co., a corporation; P. Lorillard
Co. (Inc.), a corporation; Liggett & Myers Tobacco Co. (Inc.), a corporation; West Virginia
Wholesale Grocers’ Association Co., a corporation, its officers, directors, and stockholding
members. Charge: Unfair methods of competition are charged in that the respondent jobbers
combined and conspired, with the aid of the respondent manufacturers, to fix uniform discounts
or prices for the resale of cigars, cigarettes and other tobacco products, the respondent
manufacturers refusing to sell to price cutters, all for the purpose and with the effect of
eliminating competition, in alleged violation of section 5 of the Federal Trade Commission act.
The charges were dismissed as to the American Tobacco Co.
Disposition: Dismissed without prejudice, Commissioners Nugent and Thompson dissenting.
Complaint No. 1223.--In the matter of Chicago Retail Lumber Dealers’ Association, a
corporation, its officers and members. Charge: Unfair methods of competition are charged in
that the respondents combined and conspired to restrict and destroy competition and thereupon
established and operated an “allotment pool,” the object of which was to prorate and divide in
advance the aggregate annual business of all the members on the basis of certain fixed and
agreed percentages so that each member who did more business than that allotted to him should
pay into the fund a uniform fixed percentage of the excess of business done by such member,
and that each member doing less business than that allotted to him should be paid out of said
fund the same uniform fixed percentage upon such deficiency in his business; and in that the
respondents, to effectuate their object of restricting and destroying competition, (a) prepared,
issued, and used an association price list as a basis for uniform selling prices; (b) prepared cost
surveys as a basis for said price lists; and (c) established a special fund consisting of large cash
deposits by the members, said deposits being forfeitable to respondent association in case of
noncompliance with the terms and purposes of respondents’ combination and conspiracy; and
in that the respondents, in an effort to restrict and destroy competition of nonmember
competitors, (a) threatened, intimidated, and coerced competing dealers for the purpose of
securing and retaining their membership; (b) interfered with the purchase of necessary supplies
from manufacturers and wholesalers by nonmember dealers; (c) selected certain members to
compete with nonmember competitors without regard to the scale of association prices and
jointly assumed the cost of such competition; (d) instigated malicious and vexatious litigation
against nonmember dealers, and (e) adopted and used other concerted means and measures to
hamper and obstruct the competition of nonmembers, all in alleged violation of section 5 of the
Federal Trade Commission act.
Disposition: Dismissed for hack of jurisdiction, memorandum of dissent by Commissioners
Nugent and Thompson to be filed at a later date.

Complaint No. 1224.--In the matter of Karl Sohn, Isaac Lewis, Bessie Lewis, B. Lewis (Inc.),
a corporation, and Grand Rapids Furniture Clearance Warehouse. Charge: Unfair methods of
competition are charged in that the respondents’ trade name “Grand Rapids Furniture Clearance
Warehouse,” in conjunction with the respondents’ advertising matter, tends to mislead the
purchasing public to believe that the respondents’ furniture is of Grand Rapids manufacture and
quality and that the respondents are sales agents for the manufacturers of such furniture when
in fact the furniture sold by the respondents is for the most part made at points, other than Grand
Rapids, Mich.,

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and is sold at retail, all in alleged violation of section 5 of the Federal Trade Commission act.
Disposition: Dismissed after hearing, practices charged having been discontinued ;
Commissioner Nugent dissenting.
Complaint No. 1231.--In the matter of Champion Spark Plug Co. Charge: Unfair methods of
competition are charged in that the respondent adopted and employs a merchandising system
whereby it fixes and maintains certain specified uniform prices for the resale of its spark plugs,
refusing to sell to price cutters and employing other cooperative means and methods for the
enforcement of said system of fixed resale prices, in alleged violation of section 5 of the Federal
Trade Commission act.
Disposition: Dismissed without prejudice, practices charged having been discontinued.
Complaint No. 1233.--In the matter of Permutit Co. Charge: Unfair methods of competition
are charged in that the respondent, engaged in the manufacture and sale of Zeolite watersoftening apparatus and involved in patent litigation the current findings in which indicated that
one competitive apparatus was and another was not an infringement of the respondent’s letters
patent, attempted to intimidate and coerce customers and prospective customers of its
competitors and bring about their refusal to deal with or carry out their obligations with said
competitors through fear of incurring liability to the respondent as infringers of respondent’s
patents, effecting such intimidation and coercion by publishing representations and
advertisements that all competitive apparatus was in infringement, this without specifying the
nature of the infringement or the name of the competing apparatus asserted to be in
infringement, and that the decrees entered in the aforesaid litigation established the validity of
the respondent’s representations, all in alleged violation of section 5 of the Federal Trade
Commission act.
Disposition: Dismissed after hearing.
Complaint No. 1244.--In the matter of Louis W. Meyer, doing business under the trade name
and style Grand Rapids Furniture Sales Co., and Western Furniture Manufacturers Exposition
(Inc.), a corporation. Charge: Unfair methods of competition are charged in that the
respondents, by the use of their trade name and corporate name and advertising slogans and
statements, mislead the purchasing public to believe that the respondents are manufacturers of
furniture or the authorized representatives of furniture factories located in Grand Rapids, Mich.,
when in fact the respondents purchase their furniture for resale at retail and do not in fact
eliminate the profits of middlemen to the benefit of the consuming public, in alleged violation
of section 5 of the Federal Trade Commission act.
Disposition : Dismissed, respondent having gone out of business.
Complaint No. 1246.--In the matter of Knife Information Bureau, its secretary as such and
individually, and sundry manufacturer members as such and individually. Charge: Unfair
methods of competition are charged in that respondents are banded together for the purpose of
conducting and carrying out the “reporting plan” of the association, and are thus engaged in a
wrongful and unlawful combination and conspiracy to fix uniform sales prices for their products
and to stifle and suppress competition between and among the members, the “reporting plan”
providing, inter alia, for a report by each member of his standard prices, discounts, terms of sale,
contract terms, and everything pertaining to his established sales policy affecting the market
price of his goods, the secretary in turn distributing the information to the other members;
changes in standard prices, etc., to be reported; duplicates of each day’s invoices; reports of
orders accepted; reports of contracts entered into with customers protecting them against a
change in price; etc.; secretary-treasurer may audit books of any member to ascertain correctness
of the information furnished; that as a result prices have been enhanced. and such enhanced

prices are being maintained; the bureau, through its secretary, with the aid and advice of various
members, compiles and distributes to the members lists of uniform prices, terms, and discounts
to be charged and allowed, which lists have been adopted by respondent members as their own
and adhered to by them; offending members are reported and disciplined; etc., all in alleged
violation of section 5 of the Federal Trade Commission act.
Disposition: Dismissed practices charged having been discontinued.
Complaint No. 1248.--In the matter of Fisk Rubber Co. Charge: Unfair methods of
competition are charged in that respondent, engaged in the manufac-

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123

ture and sale of automobile tires, inner tubes. and other rubber products has acquired and holds
approximately 51 per cent of the share stock of the Federal Rubber Co. (the reorganized Federal
Rubber Manufacturing Co., which company sold its product tires, mechanical rubber goods, and
sundries--through its subsidiary sales corporation, the Federal Rubber Manufacturing Co. of
Illinois) a former competitor, and that subsequent to such acquisition the Federal Rubber Co.
transferred its assets to respondent and ceased to manufacture automobile tires and similar
products ; that the effect of such acquisition is to substantially lessen competition between
respondent on the one hand and the Federal Rubber Co. and the Federal Rubber Manufacturing
Co. on the other hand ; and that such acquisition by respondent of such share stock is contrary
to law and in violation of section 7 of the Clayton Act. Chairman Vernon W. Van Fleet
dissents.
Disposition : Dismissed.
Complaint No. 1253.--In the matter of Owosso Manufacturing Co., a corporation; the Wabash
Screen Door Co., a corporation; Philadelphia Screen Manufacturing Co., a corporation;
Sherwood Metal Working Co., a corporation; Porter Screen Co., a corporation; the
Continental Co., a corporation. Charge: Unfair methods of competition are charged in t that
the respondent, manufacturers of screen doors, window screens, and similar products entered
into a combination for the sale of their respective products, the respondent, Continental Co.,
being organized to act as a common selling agency, to apportion the orders, to establish
exclusive territories, and to determine selling prices on the basis of the average cost to the
respective manufacturers, thereby eliminating and destroying competition, in alleged violation
of section 5 of the Federal Trade Commission act.
Disposition : Dismissed, Commissioners Nugent and Thompson to file a memorandum
of dissent at a later date.
Complaint No. 1254.--In the matter of the Coraza Cigar Co. Charge : Unfair methods of
competition are charged in that the respondent in connection with the sale of certain of its cigars
uses a trade-mark containing the words “Marshall Field.” together with a portrait or likeness
of Marshall Field. sir. and a coat of arms or seal similar to that used by the long established and
favorably known Marshall Field & Co., in the sale of its merchandise, thereby tending to
mislead the trade and public into the belief that the respondent’s cigars are manufactured and/or
sold by Marshall Field & Co., in alleged violation of section 5 of the Federal Trade
Commission act.
Disposition : Dismissed after hearing. Commissioners Thompson and Van Fleet dissenting.
Complaint No. 1257.--In the matter of South Jersey Wholesale Confectioners Association, of
Trenton, N. J., and its members. Charge: Unfair methods of competition are charged in that the
respondents combined and conspired to fix uniform prices for the resale to retail healers of
certain of the candies handled by them and to prevent price-cutting wholesale dealers from
obtaining goods, bringing pressure to bear on manufacturers supplying such offending dealers,
and by boycott and threats of boycott seeking to prevent manufacturers from supplying such
dealers, thereby tending to unlawfully suppress and hinder competition, in alleged violation
of section 5 of t he Federal Trade Commission act.
Disposition: Dismissed after hearing, respondent association having discontinued its activities
before the issuance of the complaint and being no longer in business, Commissioner Thompson
dissenting.
Complaint No. 1262.--In the matter of Larrowe Milling Co., American Beet Sugar Co.,
Columbia Sugar Co., Continental Sugar Co., Garden City Sugar & Land Co., Great Western
Sugar Co., Holland-St. Louis Sugar Co., Owosso Sugar Co., Toledo Sugar Co., Minnesota

Sugar Co., Michigan Sugar Co., Northern Sugar Corporation, Iowa Sugar Co., Iowa Valley
Sugar Co., Ohio Sugar Co., Menominee River Sugar Co., Spreckles Sugar Co., Santa Annia
Sugar Co., Utah-Idaho Sugar Co. Charge: Unfair methods of competition inn the sale and
distribution of beet pulp are charged in that the respondent Larrowe Milling Co. has been given
the exclusive right and privilege of selling all the beet pulp produced by the respondent sugar
manufacturing companies for sale to manufacturers of and dealers in cattle feed, the respondent,
Larrowe Milling Co., being kept advised of the quantity of beet pulp on hand and manipulating
the market in such a manner as to secure high prices for all the beet pulp sold by it, thereby
tending to suppress competition in price and to deny to the
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public the advantages in price which would obtain under conditions of natural and normal
competition between the respondents, in alleged violation of section 5 of the Federal Trade
Commission act.
Disposition : Dismissed, Commissioners Nugent and Thompson dissenting.
Complaint No. 1280.--In the matter of Banner Silk Knitting Mills (Inc.), a corporation.
Charge : Unfair methods of competition are charged in that the respondent, engaged in the sale
and manufacture of textiles or fabrics which are not composed of silk in whole or in part,
advertised and represented certain of Its products as silk and furthered the deception by the
adoption and use of the word “Silk” as a part of its corporate name, thereby tending to mislead
and deceive the purchasing public and to injure competitors who label their products truthfully,
in alleged violation of section 5 of the Federal Trade Commission act.
Disposition : Dismissed after hearing, respondent having gone out of business.
Complaint No. 1291.--In the matter of Midland Steel Products Co. Charge: Unfair methods
of competition are charged in that the respondent, pursuant to the purposes of its incorporation,
acquired the capital stock and the property, assets, and businesses, of the Parish & Bingham
Corporation and Detroit Pressed Steel Co., thereby tending to substantially lessen competition,
to restrain commerce in the sale and distribution of auto frames and frame parts and to create
a monopoly therein, in alleged violation of section 7 of the Clayton Act and section 5 of the
Federal Trade Commission act.
Disposition : Dismissed.
Complaint No. 1294.--In the matter of Plateless Engraving Co., a corporation. Charge: Unfair
methods of competition are charged in that the respondent, engaged in process printing and in
the sale of process-printed stationery, by the use of the word “engraving” in its corporate name
and advertisements tends to mislead and deceive the purchasing public into the erroneous belief
that the respondent is an engraving company engaged in the business of purchasing and selling
engraved and embossed stationery, and tends to injure competitors who do not misrepresent
their products, in alleged violation of section 5 of the Federal Trade Commission act.
Disposition : Dismissed after stipulation, respondent having changed its corporate name to
Plateless Process & Printing Co., Commissioner Nugent dissenting.
Complaint No. 1300.--In the matter of United States Roofing & Paint Co. (Inc.), a
corporation. Charge : Unfair methods of competition are charged in that the respondent,
engaged in the sale of colors, varnishes, asphalt shingles, prepared roofings, and similar
products, labels said products with the letters “U. S.,” either independently or in conjunction
with other words, or in connection with the figure known as “Uncle Sam,” thereby tending to
mislead the purchasing public into the erroneous belief that the respondent’s products were
declared and sold as surplus by the United States Government, or manufactured in accordance
with Government specifications or requirements, in alleged violation of section 5 of the Federal
Trade Commission act.
Disposition : Dismissed, practices charged having been discontinued.
Complaint No. 1305.--In the matter of Continental Baking Corporation. Charge : Unfair
methods of competition are charged in that the respondent holds and controls the whole or
substantially all of the stock of a number of corporations engaged in the baking business in the
several States of the United States, thereby tending to substantially lessen competition, to
restrain commerce in bread, biscuits, cakes, pies, crackers and other food products in the
sections or communities in which such corporations were engaged in commerce at the time of
the acquisition of their stock and to create a monopoly in said food products in alleged violation
of section 7 of the Clayton Act.

Disposition : Dismissed without prejudice to the right to issue and hear a complaint charging
the respondent with all its acquisitions of stock or share capital to this date as a violation of
section 7 of the Clayton Act.
Complaint No. 1310.--In the matter of Willis J. Davis and C. D. Swindt, partners doing
business under the trade name and style Kanuga Cigar Co. Charge: Unfair methods of
competition are charged in that the respondents, engaged in the manufacture of cigars in the
State of Georgia and in the sale thereof, label certain of their products “Smoka Tampa.” thereby
tending to mislead the public into the belief that its cigars are made in the Tampa district,
Florida, and are of Tampa quality, and to injure competitors

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125

who do not practice misrepresentation, in alleged violation of section 5 of the Federal Trade
Commission act.
Disposition : Dismissed, respondents having gone out of business.
Complaint No. 1327.--In the matter of Rose Bros. Co. Charge : Unfair methods of
competition are charged in that the respondent, engaged in the manufacture and sale of
umbrellas, advertised and represented that the handles of certain of its umbrellas were
composed of or trimmed with Bakelite, when in fact said handles were made of or trimmed
with celluloid and other products having the appearance, or being a colorable imitation, of
Bakelite as made by the Bakelite Corporation, thereby tending to deceive the trade and
purchasing public and to injure competitors who do not practice misrepresentation, in alleged
violation of section 5 of the Federal Trade Commission act.
Disposition : Dismissed after hearing.
Complaint No. 1337.--In the matter of John C. Herman and Edward S. Herman, copartners
doing business under the trade name and style of John C. Herman & Co. Charge : Unfair
methods of competition are charged in that the respondents label certain of their cigars with the
words “Tampa” or “Sumatra Wrapped” thereby tending to mislead the public to believe that the
said cigars are made in the Tampa district, and that the wrappers are of tobacco grown on the
Island of Sumatra, when in fact the respondents’ products are manufactured in the State of
Pennsylvania and the wrappers of its cigars are of tobacco grown elsewhere than on the island
of Sumatra, In alleged violation of section 5 of the Federal Trade Commission act.
Disposition : Dismissed after hearing. practices charged having been discontinued at the time
the investigation was instituted.
Complaint No. 1347.--In the matter of Joseph Goodman, doing business under the trade
names and styles Niagara Shirt Co. and Nyra Shirt Co. Charge : Unfair methods of competition
are charged in that the respondent, engaged In the manufacture of shirts from material composed
entirely of cotton, but having a high luster and resembling silk in appearance, labels said shirts
with the word “Nyrasylk,” thereby misleading the purchasing public to believe that the
respondent’s shirts are made of silk and tending to injure competitors who do not practice
misrepresentation, in alleged violation of section 5 of the Federal Trade Commission act.
Disposition : Dismissed.
Complaint No. 1348.--In the matter of Finishing Products Co. Charge: Unfair methods of
competition are charged in that the respondent, engaged in the sale of wood stains, fillers,
varnishes, and allied products, offers and gives sums of money to employees of customers and
prospective customers, without the knowledge or consent of the principals, as an inducement
to influence said employees to purchase from the respondent, in alleged violation of section 5
of the Federal Trade Commission act.
Disposition : Dismissed after hearing.
Complaint No. 1353.--In the matter of Always Ready Products Co. Charge : Unfair methods
of competition are charged in that the respondent. engaged in the manufacture and sale of a
solution for use in electric storage batteries. makes numerous deceptive and misleading
assertions as to the quality of said solution, indicating falsely that it will charge electric storage
batteries with electricity and will not freeze. thereby tending to mislead the purchasing public
and to injure competitors who do not practice misrepresentation, in alleged violation of section
5 of the Federal Trade Commission act.
Disposition : Dismissed, respondent having been adjudicated a bankrupt.
Complaint No. 1355.--In the matter of Joseph Lampl and Carl Lampl, partners. doing business
under the trade name and style Lampl Knitting Co. Charge : Unfair methods of competition are

charge in that the respondents, engaged in the sale of knitted garments to retailers, indicate by
the use of their trade name that they are manufacturers, when in fact the respondents do not
control or operate any mill or factory and purchase their garments for resale, thereby tending to
mislead the trade into the erroneous belief that the profits of middlemen are eliminated when
purchases are made from the respondents and tending also to injure competitors who do not
practice misrepresentation in alleged violation of section 5 of the Federal Trade Commission
act.
Disposition : Dismissed.
Complaint No. 1358.--In the matter of Continental Baking Corporation. Charge : Unfair
methods of competition are charged in that the respondent

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holds and controls the whole or substantially all of the stock of a number of corporations
engaged in the baking business in the several States of the United States, thereby tending to
substantially lessen competition. to restrain commerce in bread, biscuits, cakes, pies, crackers,
and other food products in the sections or communities in which such corporations were engaged
in commerce at the time of the acquisition of their stock and to create a monopoly in said food
products, in alleged violation of section 7 of the Clayton Act.
Disposition : Dismissed after hearing, action having been taken in the United States District
Court for the District of Maryland.

EXHIBIT 7
COMPLAINTS PENDING JULY 1, 1926, AND STATUS
NOTE.--On or immediately before June 30, 1926, the commission mailed one order to cease and desist and four
orders of dismissal, terminating five of the proceedings shown as pending. This action is properly reflected in the
statistical tables, but not individually indicated because serviceupon parties at interest had not been effected at the
close of the fiscal year.

Complaint No. 82.--In the matter of Photo-Engravers’ Club of Chicago. Charge: Adopting
a standard scale of uniform prices at which the members sell their products, with the intent of
stifling and suppressing competition in the manufacture and sale of photo-engraving, the
respondent having entered into an agreement with the Chicago Photo-Engravers’ Union No. 5,
I. P. E. U., by their terms of which the respondent’s members employ only union labor in their
manufacturing plants and the members of the union do not accept employment from any
manufacturing photoengraver not a member of the respondent club. In furtherance of such
agreement the union has adopted a rule whereby union labor is to cease working in
photoengraving plants which do not maintain such standard scale of prices, and has initiated a
series of fines and threats to withdraw labor, thereby compelling members to maintain such
prices against their will, all in alleged violation of section 5 of the Federal Trade Commission
act. (Consolidated with docket 928.) Status: In course of trial.
Complaint No. 266.---In the matter of Pictorial Review Co. Charge: Using unfair methods of
competition in the sale of paper dress patterns, consisting of selling patterns to dealers under a
contract permitting the dealer to return all unsold patterns on the termination of contract at three
fourths of the cost thereof, upon the condition that during the continuance of such contracts they
have sold no patterns except those manufactured by respondent, or shall have sold such patterns
at the prices fixed by respondent, in alleged violation of section 5 of the Federal Trade
Commission act; selling and making contracts for sale of its paper dress patterns on the
condition, agreement, or understanding that the purchasers thereof shall not use or deal in the
patterns of competitors, the effect of which is to substantially lessen competition or tend to
create a monopoly in violation of section 3 of the Clayton Act. Status: On suspense, awaiting
the outcome of the Butterick Co. case. (Doc. 594.)
Complaint No. 455.---In the matter of Armour & Co. Charge: That respondent acquired threefifths of the capital stock of Harold L. Brown Co (Inc.), a competitor, which company had
previously acquired the capital stock and business of Beyer Bros. Commission Co., and also the
capital stock and business of Beyer Bros. Co. ; that it acquired as vendee and pledgee in
controlling amount of the capital stock of the Eau Claire Creamery Co.; that it acquired through
its agents 503 of the 1,000 shares of the capital stock of the Louden Packing Co., an Ohio
corporation, which corporation transferred all its business and property to the Louden Packing
Co., a Delaware corporation, in consideration of all of the stock of the Delaware corporation,
consisting of 1,000 shares, 503 of which are held by agents of respondent in trust for respondent
; that it acquired one-half of the capital stock of the A. S. Kinimmoth Produce Co.; that it
acquired the entire capital stock of the Pacific Creamery, which company the respondent held
out and advertised as wholly independent without connection with respondent ; and acquired
501 shares of the capital stock of Smith, Richardson & Conroy, a Florida corporation, and that

the result of such acquisitions by respondent is the domination by respondent of the business of
some of the above-mentioned companies, the elimination of competition between the abovementioned companies, and the creation of conditions which tend to create a monopoly, in
alleged violation of section 5 of the Federal Trade Commission act and section 7 of the Clayton
Act. Status: Before the Commission for final determination.
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Complaint No. 457.---In the matter of Western Meat Co. and Nevada Packing Co. Charge:
That respondents have violated section 5 of the Federal Trade Commission act and section 8 of
the Clayton Act by having F.L. Washburn, a director of both the Western Meat Co. and the
Nevada Packing Co. (between which companies competition existed), and illegally acquiring
by the Western Meat Co., the capital stock of the Nevada Packing Co., which acquisition
suspended between respondents competition which theretofore existed between them and tended
to create a monopoly Status: Held pending decision in docket 456, which is now pending in the
Circuit Court of Appeals for the Ninth Circuit.
Complaint No. 775.---In the matter of Swift & Co., National Leather Co. Charge: That the
respondent Swift & Co., by reason of its acquisition of a controlling interest in England, Walton
& Co. (Inc.) and its subsidiaries, and the subsequent organization by Swift & Co. of
respondent National Leather Co. and the transfer thereto of the Swift & Co. interest in England,
Walton & Co., and in numerous other corporations engaged in tanning and the manufacture
and sale of leather and by-products, the corporate stock of which had been acquired by Swift
& Co., has been for the purpose and effect of substantially lessening competition and of creating
a combination in restraint of trade in the manufacture and sale of leather, in alleged violation
of section 5 of the Federal Trade Commission act and section 7 of the Clayton Act. Status:
Before the commission for final determination.
Complaint No. 785---In the matter of J. H. Crites, John G. Dee, W. J. Ross, M. W. McQuaid,
and M. L. Chandler. Charge: Using unfair methods of competition in the sale of share stock of
the O-tex Production Co., by the use of numerous false and misleading statements as to the said
company’s drilling operations and the productivity of its properties, to the effect of misleading
and deceiving the purchasing public, in alleged violation of section 5 of the Federal Trade
Commission act. Status: Awaiting respondent’s brief.
Complaint No. 835.---In the matter of Famous Players-Lasky Corporation, the Stanley Co. of
America, Stanley Booking Corporation, Black New England Theaters (Inc.), Southern
Enterprises (Inc.) Saenger Amusement Co., Adolphe Zukor, Jesse L. Lasky, Jules Mastbaum,
Alfred S. Blank, Stephen A. Lynch, Ernest V. Richards, Jr. Charge: Unfair methods of
competition in that the respondents Famous Players-Lasky Corporation, Adolphe Zukor, and
Jesse L. Lasky have combined and conspired to secure control of and monopolize the motion
picture industry, and to restrain, restrict, and suppress competition in the distribution of motion
picture films by (a) acquisition of all the corporate stock of Bosworth ( Inc.), Jesse L. Lasky
Feature Play Co (Inc.), Famous Players Film Co., and by coercion, Paramount Pictures
Corporation ; (b) affiliation with certain independent producers; (c) the creation and exploitation
of the Realart Pictures Corporation which the respondents held out to the general public as
wholly independent and not affiliated with or controlled by said respondents ; (d) acquiring, with
the aid of the other respondents, the control of numerous theater corporations operating motion
picture theaters throughout the United States ; and (e) building or acquiring numerous theaters
for the exhibition of respondents’ motion pictures, exclusively, all in alleged violation of
section 5 of the Federal Trade Commission act, and as to respondents Famous Players-Lasky
Corporation, Adolphe Zankor, and Jesse L. Lasky, in alleged violation of section 7 of the
Clayton Act. Status: Awaiting the taking of additional testimony.
Complaint No 857.---In the matter of S. F. Shepard, Rockwood Brown, A. L. Todd, R Allyn
Lewis, R J. Wiswell, D. M. Leopold, H. P. Hanson, E.H. Eshleman, F. L. Moorman, and E. H.
McArthur. Charge: The respondents are trustees for or associated in the promotion of the
Burkley Oil Co., Buck Crest Oil Co., Burk Bethel Oil Co., Gypsy Burk Oil Co., Burk Imperial
Oil Co., and Burk Consolidated Oil Co. Unfair methods of competition are charged in that the

respondents, to further the sale of the share stock of said unincorporated associations, issued and
published numerous false and misleading statements and concealed or withheld other material
information relative to the organization, business, and properties of the said companies, thereby
deceiving and misleading the purchasing public, in alleged violation of section 5 of the Federal
Trade Commission act. Status: Awaiting respondent’s brief.
Complaint No. 865.---In the matter of Henry H. Hoffman, R C. Russell, J. H. Cain, R V.
Wilson, B. Baernstein, the Ranger-Burkburnett Oil Co., the Ranger-Comanche Oil Co., and the
Union National Oil Co. Charge: The respondent individuals are promoters of the respondent
corporation. Unfair methods of

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129

competition are charged in that they, in order to further the sale of the share stock of the said
corporations, issued and published numerous false and misleading statements and concealed or
withheld other material information relative to the organization, business, and properties of the
said corporation, thereby deceiving and misleading the purchasing public in alleged violation
of section 5 of the Federal Trade Commission act. Status: Awaiting respondent’s brief.
Complaint No. 871.---In the matter of A. W. Perryman, doing business under the name and
style Perry man Investment Co. ; A. W. Perry man, F. P. Penfleid, C. S. Thomas, individually
and as trustees and officers of the Houston Oil & Refining Co., a trust ; W. L. Diehl,
individually and as second vice president of the Houston Oil & Refining Co., a trust; and
William M. Huff, individually and as third vice president of the Houston Oil & Refining Co.,
a trust. Charge: The respondents are the promoters of the Houston Oil & Refining Co., a Texas
trust. Unfair methods of competition are charged in that the respondents, for the purpose of
furthering the sale of the share stock of the said oil company, issued and published numerous
false and misleading statements and concealed or withheld other material information relative
to the organization, business, property, and prospects of said corporation, thereby deceiving the
purchasing public, in alleged violation of section 5 of the Federal Trade Commission act.
Status: Awaiting respondents briefs.
Complaint No. 873.---In the matter of Hewitt Brothers Soap Co. Charge: Unfair methods of
competition in that the respondent advertises, brands, and labels its soap as “white naphtha,”
stating that it is made by a new process and of a combination of naphtha, coconut oil, and other
cleansing ingredients, when, in fact, the said soap contains no naphtha, but contains instead a
petroleum distillate other than naphtha, originally only to the extent of l per cent or less of the
whole constituent ingredients, and substantially all lost by volatilization or evaporation before
such soap reaches the ultimate consumer, thereby misleading and deceiving the purchasing
public, in alleged violation of section 5 of the Federal Trade Commission act. Status: At issue.
Complaint No. 902.---In the matter of The Chicago Tobacco Jobbers’ Association, its officers
and members, and the American Tobacco Co., respondents. Charge: The charge is unfair
competition in that the association and its members agreed upon a schedule of fixed prices at
which the members should resell tobacco products to their customers and that the American
Tobacco Co. entered into an agreement with the association and its members to assist them in
maintaining the prices fixed and agreed upon, all in alleged violation of section 5 of the Federal
Trade Commission act Status: Awaiting court decision in the matter of Wholesale Tobacco &
Cigar dealers Association of Philadelphia, Pa.; docket No. 886.
Complaint No. 925. ---In the matter of Mid-American Oil & Refining Co. and J.H. Crites,
Charge: The respondent individual is the promoter of respondent Mid-American Oil & Refining
Co., a Texas trust. Unfair methods of competition in commerce are charged in that respondents,
with the aid of certain subsidiaries known as Mid-American Syndicate. Mid-American Mexia
Syndicate, and Mid-American Stevens County Syndicate, published numerous false and
misleading statements and representations relative to the organization, business, property, and
prospects of respondent company and said syndicates to further the sale of the share stock of the
respondent, and thereby deceived the purchasing public, in alleged violation of section 5 of the
Federal Trade Commission act. Status: Awaiting respondent’s brief.
Complaint No. 928 (in consolidation with 82).---In the matter of The American PhotoEngravers’ Association and others, and the international Photo-Engravers’ Union of North
America, and others. Charge : Unfair methods of com-petition in commerce are charged in that
the respondents conspired and agreed to adopt and maintain a scale of uniform prices for the
sale of all photo-engraving products. The respondent, International Photo-Engravers’ Union

of North America and its local organizations threatened to call strikes or withdraw union
employees from photo-engraving establishments that would not maintain said uniform scale of
prices, it being understood between the respondents hat the members of the respondent
association would employ none but members of respondent union’s local organization thereby
and with the aid of other methods of enforcement of said agreement, regulating, controlling, and
suppressing competition between manufacturers of photo-engraving products, making possible
the establishment and maintenance of enhanced prices

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of such products, and hindering free competition, in alleged violation of section 5 of the Federal
Trade Commission act. Status: In course of trial.
Complaint No. 930.---In the matter of Right-Way Royalty Syndicate, E. L. Chapman, H. F.
Mitchell, and A. J. Chapman. Charge: Respondent syndicate is an unincorporated Texas trust.
The respondent individuals are trustees, officers, organizers, and promoters and constitute the
board of trustees of said respondent syndicate. Unfair methods of competition are charged in
that the respondents, to further the sale of syndicate securities have made and are still making
numerous false, misleading, and deceptive statements concerning the business, management,
operations, property, prospects, etc., of said syndicate, in violation of section 5 of the Federal
Trade Commission act. Status : Awaiting final determination by the commission.
Complaint No 932.---In the matter of Dispatch Petroleum Co., Porter Oakes, and James T.
Chiles. Charge : Respondent company is a Texas joint-stock association and respondent
individuals are promoters thereof. Unfair methods of competition in commerce are charged
in that respondents, to further the sales of the share stock of said company, made numerous false
and misleading statements and concealed essential facts as to the properties, prospects, and
earnings of said company, in alleged violation of section 5 of the Federal Trade Commission act.
Status : Awaiting briefs.
Complaint No. 956.---In the matter of Oakleed Oil Co., Mark Kleeden, and Julia K Threlkeld.
Charge: Unfair methods of competition in commerce are charged in the sale of the share stock
of respondent company in that the respondents have misrepresented the business, management,
properties, and prospects of the said respondent oil company for the purpose of misleading and
deceiving the purchasing public, in alleged violation of section 5 of the Federal Trade
Commission act. Status : Suspended pending investigation by the Post Office Department.
Complaint No. 960.---In the matter of Texas-Mexia Drilling Syndicate; B. M. Hatfield,
Sterling Syndicate, J. D. Johnson, Old Timers Oil Pool, Albert 5. Leach, Co-operative Oil
Interests, and C. R Farmer. Charge : Unfair methods of competition in the sale of the share stock
of the respondent syndicates and interests, are charged, in that the respondents have
misrepresented the business, management, properties, and prospects of said respondent
syndicates and interests for the purpose of misleading and deceiving the purchasing public, in
alleged violation of section 5 of the Federal Trade Commission act. Status : Suspended pending
criminal prosecution by the United States.
Complaint No 962.---In the matter of Bethlehem Steel Corporation, Bethlehem Steel Co.,
Bethlehem Steel Bridge Corporation, Lackawanna Steel Co., Lackawanna Bridge Works
Corporation, Midvale Steel & Ordnance Co., Cambria Steel Co. Charge : The respondent, the
Bethlehem Steel Corporation, on or about October 25, 1922, acquired the properties, assets, and
businesses of the Lackawanna Steel Co. and its subsidiaries and is now acquiring and has
acquired the properties, assets, and businesses of the respondents, Midvale Steel & Ordnance
Co. and Cambria Steel Co. Unfair methods of competition in commerce are charged in that the
respondents by uniting under a common ownership and management and thereby effecting
control of the iron and steel products originating in their respective territories tend to substantially lessen potential and actual competition, contrary to the public policy expressed in section
7 of the Clayton Act and in alleged violation of section 5 of the Federal Trade Commission act,
to unduly hinder competition in the iron and steel industries in said territory and unreasonably
restrict competition so as to restrain trade contrary to the public policy expressed in sections 1
and 3 of the Sherman Act and in alleged violation of section 5 of the Federal Trade Commission
act. Status : In course of trial.
Complaint No. 963.---In the matter of Roller Oil & Refining Co. (Inc.), H. C. Roller, C. F.

Gibbons, Percie C. Wilie, E. H. Doud. Charge: Unfair methods of competition are charged in
the sale of share stock of the respondent corporation in that the respondents have
misrepresented the business, management, properties, and prospects of said corporation for the
purpose of misleading and deceiving the purchasing public, in alleged violation of section 5 of
the Federal Trade Commission act. Status : Awaiting final argument.
Complaint No. 988.--In the matter of Paramount Royalty Syndicate and Lea R Ellis. Charge
: Unfair methods of competition in commerce are charged

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in the sale of securities of respondent syndicate in that the respondents have misrepresented
the organization, business, management, properties, and prospects of said respondent syndicate
for the purpose of misleading and deceiving the purchasing public, in alleged violation of
section 5 of the Federal Trade Commission act. Status : At issue.
Complaint No. 1028.---In the matter of Guaranty Royalties Co., W. F. Rogers, W. L. Hughes,
and A. C. Loughrey. Charge : Unfair methods of competition are charged in the sale of the stock
of the respondent joint-stock association in that the respondents have made numerous false,
misleading, and deceptive statements concerning the organization, management, properties, production, earnings, and prospects of the respondent company for the purpose of inducing the
public to purchase said stock, in alleged violation of section 5 of the Federal Trade Commission
act. Status: At issue
Complaint No. 1044.---In the matter of Pacific Commercial Co. and Exporters’ and Importers’
Association of the World. Charge : Respondents are charged with having accepted orders and
received payment from foreign customers for first-class new automobile chassis, and through
negligence or. collusion have caused or permitted to be substituted for the goods ordered
secondhand, inferior, or worthless goods, which unfair method of competition has the tendency
to injure and damage the reputation of respondents’ competitors who truthfully fulfill their
contracts, in alleged violation of section 5 of the Federal Trade Commission act as extended
by the provisions of section 4 of the Webb Act. Status : Before the Commission for final
determination.
Complaint No. 1053.--Federal Trade Commission v. The Worrell Manufacturing Co. Charge
: Unfair methods of competition are charged in that respondent, engaged in the sale of
insecticides, disinfectants, and sanitary appliances, offers and gives goods and merchandise as
premiums or gratuities to public officials in charge of Government departments, boards, and
administrative offices purchasing supplies for public institutions, as an inducement to purchase
respondent’s products, in alleged violation of section 5 of the Federal Trade Commission act.
Status : At issue.
Complaint No. 1066.---In the matter of Jacob Busch. Charge: unfair methods or competition
are charged in that the respondent s practice of stamping as “Sheffield”his silver-plated ware
which is not manufactured in Sheffield England and which is of a quality inferior to that of the
silver and silver-plated ware commonly known as Sheffield silver or Sheffield silver plate, tends
to mislead and deceive the purchasing public as to the value and quality of his wares, in alleged
violation of section 5 of the Federal Trade Commission act. Status: Before the commission for
final determination.
Complaint No. 1067.---In the matter of Ontario Silver Co. Charge : Unfair methods of
competition are charged in that the respondent’s practice of stamping as “Sheffield” his Silverplated ware which as not manufactured in Sheffield, England, and which is of a quality inferior
to that of the silver and silver-plated ware commonly known as Sheffield silver or Sheffield
silver plate, tends to mislead and deceive the purchasing public as to the value and quality of his
wares, in alleged violation of section 5 of the Federal Trade Commission act. Status: Before the
commission for final determination.
Complaint No. 1068 ---In the matter of Samuel E. Berstein (Inc.). Charge: Unfair methods
of competition are charged in that the respondent’s practice of stamping as “Sheffield” its
silver-plated ware which is not manufactured in Sheffield, England, and which is of a quality
inferior to that of the silver and silver-plated ware commonly known as Sheffield silver or
Sheffield silver plate, tends to mislead and deceive the purchasing public as to the value and
quality of its wares, in alleged violation of Section 5 of the Federal Trade Commission act.

Status: Before the commission for final determination.
Complaint No. 1089.---In the matter of The Three-In-One oil Co. Charge : Unfair methods
of competition are charged in that the respondent employs a system for the maintenance and
enforcement of certain specified uniform prices fixed by it at which its shall be resold by
wholesale and retail dealers, respectively, and uses cooperative means of accomplishing the
maintenance of said retail prices, thereby tending to restrain the natural flow of commerce and
freedom of competition, in alleged violation of section 5 of the Federal Trade Commission act.
Status: Before the commission for final determination.
Complaint No. 1097.---In the matter of H. O. Rogers Silver Co., a corporation. Charge:
Unfair methods of competition are charged In that the respondent’s practice of stamping as
“Sheffield” or “Sheffield, made in U. S. A..,” its silver-plated ware which is not manufactured
in Sheffield, England, and which is

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of at quality inferior to that of the wares commonly known as “Sheffield silver” or “Sheffield
silver plate” tends to mislead and deceive the purchasing public as to the value named quality
of its ware in alleged violation of section 5 of the Federal Trade Commission act. Status : At
issue.
Complaint No. 1100.---In the matter of American Snuff Co. Charge: Unfair methods of
competition are charged in that the respondent adopted and enforced a system of uniform prices
for the resale of its products, refusing to sell to price cutters and employing other cooperative
means and methods to compel the maintenance of its resale prices, thereby tending to suppress
competition and to deprive the consuming public of advantages in price which they would
obtain under conditions of free competition, in alleged violation of section 5 of the Federal
Trade Commission act. Status: Awaiting examiner’s report.
Complaint No.1102.---In the matter of White Silver Co. Charge : Unfair methods of
competition are charged in that the respondent, engages in the manufacture and sale of silverplated tableware, tends to mislead and deceive the purchasing public by stamping its product
as “Quadruple plate” thereby indicating that its wares have been plated four times or bear at
four-fold thickness of silver plating when in fact the respondent’s products are stated to be
of the most thinly plated and least durable quality or variety of silver-plated commodities, in
alleged violation of section 5 of the Federal Trade Commission act. Status: At issue.
Complaint No. 1110.--In the matter of James S. Kirk & Co. Charge: Unfair methods of
competition are charged in that the respondent has manufactured and sold in addition to its
several brands of soap which contain various percentages of olive oil, seven other separate kinds
of soap which it labeled, advertised, and sold as “Castile” soaps, though said soaps contained
no olive oil content whatsoever, thereby tending to mislead and deceive the public into the belief
that the respondent’s soaps are genuine Castile soap the oil ingredient of which is olive oil, in
alleged violation of Section 5 or the Federal Trade Commission act. Status : Awaiting action
on respondent’s motion to dismiss.
Complaint No. 1111.---In the matter of Dwinell-Wright Co. a corporation. Charge, : Unfair
methods of competition are charged in that the respondent, engaged in the importation and sale
of teas and coffees, employs a system of fixing and maintaining certain specified uniform prices
at which its products will be resold by wholesaler jobbers to retailers and by retailers to the
consuming public, using various cooperative methods of maintaining the said established resale
system, and thereby tending to hinder and suppress competition and top obstruct the free and
natural flow of commerce, in alleged violation of section 5 of the Federal Trade Commission
act. Status : Awaiting final argument.
Complaint No 1115.---In the matter of General Electric Co., American Telephone &
Telegraph Co., Western Electric Co. (Inc.), Westinghouse Electric & Manufacturing Co., The
International Radio Telegraph Co., United Fruit Co., Wireless Specialty Apparatus Co., and
Radio Corporation of America. Charge : Unfair methods of competition are charged In that the
respondents have combined and conspired for the purpose and with the effect of restraining
competition and creating an monopoly in the manufacture, purchase, and smile of radio devices
and apparatus by: (l) Acquiring patents and patent rights covering all radio devices and
apparatus and combining and pooling or allotting the rights thereunder ton manufacture, sell,
or use such devices and apparatus; (2) granting to the respondent Radio Corporation of America
the exclusive right to sell certain radio devices and restricting its purchases to the products of
certain of the respondent manufacturers; (3) restricting the competition of certain respondents
; (4) restricting the use in radio communication or broadcasting of articles manufactured and
sold under respondent’s patents mind patent rights; (5) acquiring equipment heretofore existing

for transoceanic radio communication and perpetuating the monopoly thereof by refusing to
supply to others the apparatus and devices necessary for the employment and operation of
certain service ; (6) entering into exclusive contracts and preferential agreements for the
handling of transoceanic radio traffic and the transmission of radio messages in this country,
thereby excluding others from the necessary facilities for the transmission of radio traffic; and
(7) agreeing mind contracting earning themselves to cooperate in the development of new
inventions relating to radio and to exchange patents covering the results of the research and
experiment of their employees in the art of radio, seeking thereby to perpetuate their control arid
monopoly of the various means of radio communication and broadcasting license the time
covered by existing patents

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133

owned by their or under which they are licensed, all in alleged violation of section 5 of the
Federal Trade Commission act. Status : In course of trial.
Complaint No. 1127.--In the matter of Calumet Baking Powder Co. Charge : Unfair methods
of competition are charged in that the respondent has published and circulated numerous false
and misleading statements in disparagement of “ K. C. baking powder,” a product of the Jaques
Manufacturing Co., thereby tending to mislead the trade into the belief that said K. C. baking
powder is an inferior, adulterated, and undesirable product and to injure and damage the
business and good will of said competitor, the Jaques Manufacturing Co., in alleged
violation of section 5 of the Federal Trade Commission act. Status : In course of trial.
Complaint No. 1131.--In the matter of Cosmopolitan Silver Co. Charge: Unfair methods of
competition are charged in that the respondent, engaged in the manufacture of silver-plated
ware in the city of New York and in the sale thereof, stamps its silverware with the words
“Sheffield,” “Sheffield plate,” or other similar designations containing the word “Sheffield,”
thereby tending to create the false impression that its silver-plated ware was manufactured in
Sheffield, England, and is of the high quality associated with the terms “Sheffield silver” and
“Sheffield plate,” in alleged violation of section 5 of the Federal Trade Commission act.
Status: At issue on amended complaint.
Complaint No. 1143.---In the matter of P. Perlmutter and C. W Quigley, partners doing
business under the trade name and style P. and Q Furniture Store. Charge : Unfair methods of
competition are charged in that the respondents, engaged In the purchase and resale of furniture
and having no factory of their own, sell and advertise said furniture as from “factory direct to
you,” thereby tending to mislead the purchasing public to believe that In dealing with the
respondents they are buying direct from the manufacturer and saving the profits of middlemen,
in alleged violation of section 5 of the Federal Trade Commission act. Status : Awaiting
respondent’s brief.
Complaint No. 1145.--In the matter of Northwestern Traffic & Service Bureau (Inc.), its
officers, directors, and subscribers, and Northwestern Publishing Co. and its president.
Charge : Unfair methods of competition are charged in that the respondents, by cooperating
in the enjoyment of various unfair, intimidating dating, and coercive measures in behalf of their
subscribers, heretofore affiliated as the Northwestern Retail Coal Dealers Association, and with
the said of the respondent publishing company’s trade journal “The Coal Dealer,” tend to
constrain producers and wholesalers of coal to confine distribution to so-called regular channels
selected and approved by the respondents and to prevent the sale of coal to independents and
consumers, thereby obstructing and hindering competition, in alleged violation of section 5 of
the Federal Trade Commission act. Status : Before the commission for final determination.
Complaint No. 1150.--In the matter of Morton F. Baum, an individual doing business under
the trade name and style Michigan Sample Furniture Co. Charge : Unfair methods of
competition are charged in that the respondent retailer falsely advertises that its furniture is sold
at manufacturers’ prices, thereby tending to mislead the purchasing public into the belief that
middlemen’s profits are saved to the respondent’s customers, and in that the respondent
advertises and offers certain of his furniture as “walnut” when in fact said furniture is made of
woods other than walnut and in imitation of genuine walnut wood, all in alleged violation of
section 5 of the Federal Trade Commission act. Status : At issue.
Complaint No. 1153.--In the matter of The National Association of Stationers &
Manufacturers of the United States, its officers and members, et al. Charge : Unfair methods
of competition are charged In that the respondent associations of stationery manufacturers and
dealers entered into a combination and conspiracy with the purpose, intent, and effect of

discouraging, stifling, and suppressing competition in the wholesale and retail stationery trade
and of enhancing the prices of such goods by (a) establishing and maintaining a National
Catalogue Commission for the preparation and distribution of lists of standard minimum retail
prices; (b) establishing and maintaining local committees to further the purposes of the
National Catalogue Commission ; (c) inducing manufacturers to adopt the recommendations
of the National Catalogue Commission and to increase their list prices, enlarge trade discounts
and standardize resale prices; (d) endeavoring to compel the adoption of said minimum prices
and standard retailers’ discounts (e)

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securing the adoption of standard cost-keeping methods which have the effect of inflating costs
as a basis for the gross margins to be secured and the resale prices to be recommended ; ( f)
encouraging refusal to sell to price cutters; (g) by inducing dealers to boycott manufacturers
not in harmony with the policies of the respondents and give preference to cooperating
manufacturers ; (h) circulating false and derogatory statements concerning the quality of goods
and business methods of those who refuse to adopt the respondents’ recommendations; (i)
inducing manufacturers to refuse to sell to the so-called irregular dealers. transient dealers and
brokers; (j) endeavoring to eliminate competition between the various branches of the trade and
discriminating in favor of manufacturers who abstain from selling direct to consumers; (k)
gathering and disseminating information in aid of the enforcement of the aforesaid policies and
excluding from membership in the respondent association all retailers not in harmony with said
policies, all in alleged violation of section 5 of the Federal Trade Commission act. Status : In
course of trial.
Complaint No 1156.--In the matter of Hemill Silverware Co. Charge : Unfair methods of
competition are charged in that the respondent’s practice of using the word “Sheffield” or
“Sheffield plate” in designating its silver-plated ware which is not manufactured in Sheffield,
England, nor of the quality of genuine Sheffield silver and Sheffield plate, tends to mislead and
deceive the purchasing public as to the value and quality of said product, in alleged violation
of section 5 of the Federal Commission act. Status: Awaiting briefs.
Complaint No. 1157.--In the matter of Benedict Manufacturing Co. Charge : Unfair methods
of competition are charged in that the respondent, engaged inn the manufacture and sale of
silver-plated ware, stamps its products with the words “ Quadruple plate,” thereby tending to
create the false impression that its ware have been coated or plated four times and to induce the
purchase of its product in preference to competitors’ commodities of similar quality not
misrepresented, in alleged violation of section 5 of the Federal Trade Commission act. Status
: At issue on amended complaint.
Complaint No 1158.--In the matter of W. A. L. Silver Manufacturing turning Co. Charge:
Unfair methods of completion are charged in that the respondent, engaged in the manufacture
of silver-plated ware in the City of New York, stamps its silverware with the words “
Sheffield,” “Sheffield plate,” on other similar designations containing the word “Sheffield,”
thereby tending to create the false impression that its silver-plated ware was manufactured in
Sheffield, England, and is of the high quality associated with genuine Sheffield silver and
Sheffield plate, in alleged violation of section 5 of the Federal Trade Commission act. Status
: At issue on amended complaint.
Complaint No. 1160.--In the matter of A.L. Wagner Manufacturing Co. Charge: Unfair
methods of competition are charged in that the respondent, engaged in the manufacture of silverplated ware in the city of New York, stamps its silverware with the words “Sheffield,” or other
similar designations containing the word “Sheffield,” thereby tending to create the false
impression that its silver-plated ware was manufactured in Sheffield, England, and is of the high
quality associated with genuine Sheffield silver and Sheffield plate, in alleged violation of
section 5 of the Federal Trade Commission act. Status: At issue on amended complaint.
Complaint No. 1162.--In the matter of. The Rialto Silver Plated Ware Co. ( Inc. ) . Charge:
Unfair methods of competition ion are charged in that the respondent, engaged in the
manufacture of silver-plated with in the city of New York, stamps its silverware with the words
are Sheffield” “Sheffield plate,” or other similar designations containing the word “Sheffield,”
thereby tending to create the false impression that its silver-plated ware was manufacture in
Sheffield, England, and is of the high quality associated with genuine Sheffield

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135

silver and Sheffield plate, in alleged violation of section 5 of the Federal Trade Commission act.
Status At issue.
Complaint No 1163.--In the matter of Keystone Metal Spinning & Stamping Co. Charge:
Unfair methods of competition are charged in that the respondent, engaged in the manufacture
of silver-plated ware in the city of New York, confuses and misleads the purchasing public by
stamping its wares with such designations as “Sheffield,” “Sheffield plate,” and Quadruple
plate,” any and all of which are misrepresentative of the manufacture, quality, and value of the
respondent’s products, in alleged violation of section 5 of the Federal Trade Commission act.
Status: At issue on amended complaint.
Complaint No. 1165.--In the matter of James A McCafferty Sons Manufacturing Co.
(Inc.). Charge : Unfair methods of competition are charged in that the respondent, engaged in
the manufacture and sale of paint and paint products, advertises and sells one of its products as
“Gold seal combination white lead,” when in fact said product contains no sulphate or
carbonate of lead in amount greater than 3 per cent of the total ingredients of said product,
thereby tending to mislead and deceive the purchasing public as to the quality of said product,
in alleged violation of section 5 of the Federal Trade Commission act. Status : At issue.
Complaint No 1184.--In the matter of Philip Carey Manufacturing Co., Philip Carey Co.
Charge : Unfair methods of competition are charged in that the respondent’s practice of entering
into exclusive contracts whereby competitors bind themselves not to deal in the products of any
competitor of respondents tends to substantially lessen competition in the sale of asbestos and
asphalt products, and asphalt paving joints particularly, and to create a monopoly of such
commerce in the hands of the respondents, in alleged violation of section 5 of the Federal Trade
Commission act and section 3 of the Clayton Act and in that the respondents make disparaging
statements concerning competitors’ products, business methods, and financial responsibility,
practice espionage, threaten and intimidate customers of competitors, thereby causing them to
break existing contracts, and threaten infringement suits without intention of bringing such suits,
said persecution and harassment against competitors being calculated and intended to
prevent sales of said competitors paving joints, in alleged violation of section 5 of the
Federal Trade Commission act. Status : In course of trial.
Complaint No.1192.--In the matter of Kritzer ( Inc.) . Charge : Unfair methods of
competition are charged in that respondent engaged in the resale of furniture which he has
purchased, for the most part, from manufacturers other than those of Grand Rapids, Mich., by
using the trade name “Furniture manufacturers warehouse” and falsely advertising that the is
on sales agent for furniture manufacturers of Grand Rapids, Mich., tends to mislead the
purchasing public to believe that in dealing with the respondent they are buying direct from the
manufacturer and saving the profits of middlemen, in alleged violation of section 5 of the
Federal Trade Commission act. Status: Awaiting final argument.
Complaint No. 1193.--In the matter of Grand Rapids Smiles Co. Charge : Unfair methods
of competition are charged in that respondent, engaged in the resale of furniture which he has
purchased for the most part. from manufacturers other than those of Grand Rapids, Mich., by
using the trade name “Grand Rapids Sales Co.” and falsely advertising that he is no sales agent
for furniture manufacturers of Grand Rapids, Mich., tends to mislead the purchasing public into
the belief that in healing with the respondent they are buying direct from the manufacturer and
saving the profits of middlemen, in all alleged violation of section 5 of the Federal Trade
Commission act. Status : Awaiting final argument.
Complaint No. 1196.--Federal Trade Commission v. Wisconsin Wholesale Grocers’
Association, James D. Godfrey, individually and as president of said association; M. J. Brew,

individually and as first vice president of said association; Mitchell Joannes, individually and
as second vice president of said association; Francis E. Dewey, individually and as treasurer of
said association; Francis J. Reckert, individually and as secretary of said association; GlassTurbusi Co.; Otto L. Kuehn & Co. Charge : Unfair methods of competition are charged in that
respondents have agreed to confine the distribution of groceries and allied products to “regular”
and “legitimate” channels of trade, to wit, from the producer or manufacturer to the wholesaler,
from the wholesaler to the retail dealer, and to fix uniform wholesale prices and to prevent price
cutting,

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the said agreement, enforced by intimidation, coercion, and boycotting, tending to suppress and
hinder competition and to obstruct the natural flow of commerce, in alleged violation of section
5 of the Federal Trade Commission act. Status: Before the commission for final determination.
Complaint No. 1201.--In the matter of J. R. Speal, Hartman & Manahan, L. L. Hardesty &
Co., Charles Jacobs, Rowe V. Clark, J, A. Morgan & Sons, W. K. Morgan & Co., Paul Brown,
W. F. Allen & C. Charge : Unfair methods of competition are charged in that the respondents
have combined and cooperated to eliminate competition In the purchase of strawberries in the
producers’ market for a large strawberry producing area, and thereby restrict the prices paid to
an amount substantially less than the growers would receive under conditions of free and open
competitive purchasing; and in that the respondents thereafter cause their principals, without
their knowledge or consent, to pay prices substantially in excess of the amounts paid by the
respondents to the growers of the strawberries, thereby tending to enhance prices of said
strawberries to a large number of the consuming public, in alleged violation of section 5 of the
Federal Trade Com mission act. Status : In course of trial.
Complaint No. 1203.--In the matter of Barnes-Ames Co., Barnes-Irwin Co. Charge : Unfair
methods of competition are charged in that the respondents, exporters of wheat, have accepted
orders and received payment from foreign customers for wheat of a specified quality and,
wilfully or through negligence, have delivered wheat of a quality inferior to that ordered and
containing large quantities of chaff and other foreign substances, thereby tending to Injure the
export trade generally, in alleged violation of section 5 of the Federal Trade Commission act.
Status : Awaiting action on respondent’s motion to dismiss
Complaint No. 1211.--In the matter of Seal Island Thread Co. (Inc.). Charge : Unfair
methods of competition are charged In that the respondent sells certain of its cotton sewing
thread as “Satin Silk” or “Satinsilk” adding, in some instances, In smaller and less conspicuous
letters, the words “Mercerized Cotton” or “Perfect Substitute for Best Silk,” thereby tending to
mislead and deceive the purchasing public as to the quality of said product, In alleged violation
of section 5 of the Federal Trade Commission act. Status : Awaiting respondent’s brief.
Complaint No. 1215.--In the matter of Motor Wheel Corporation. Charge : Unfair methods
of competition are charged in that resplendent, engaged in the manufacture and sale of wooden
wheels and steel disc wheels for automobiles and sundry parts and materials therefor, having
acquired the businesses and assets of its competitors, Prudden Wheel Co. and Auto Wheel Co.;
proceeded to and did acquire the corporate stock of Forsythe Bros. Co., the only competitor of
the respondent during the year 1922 in the manufacture of steel disc wheels, thereby tending to
lessen competition, restrain interstate commerce and to create a monopoly, in alleged violation
of section 7 of the Clayton act. Status : At issue.
Complaint No. 1216.--In the matter of John R. Walker and American Woods Export
Association, a corporation. Charge : Unfair methods of competition are charged in that the
respondents engaged in the export of lumber, failed to fulfill contracts with foreign customers,
delivered lumber of a different kind and of a lower grade and quality, and in less amounts, and
at dates much later than those specified In said contracts and, with the intent and purpose of
deceiving said customers, falsely invoiced their deliveries as of the kind and quality designated
in said contracts, falsely representing said lumber as measured and inspected by the
Lumberman’s Bureau of Washington, D C., thereby tending to bring into disrepute and
injuriously affect the export trade in lumber, in alleged violation of section 5 of the Federal
Trade Commission act. Status : In course of trial.
Complaint No. 1218.--In the matter of Chemo Company, a corporation. Charge : Unfair
methods of competition are charged In that the respondent, engaged In the manufacture and sale

of disinfectants, antiseptics, and soaps, offers and gives prizes or premiums to administrative
officers and purchasing agents of public institutions, without the knowledge or consent of their
principals, to induce said purchasers to buy the respondent’s products in preference to those of
Its competitors, in alleged violation of section 5 of the Federal Trade Commission act. Status
: In course of trial.
Complaint No. 1219.--In the matter of Hayes Wheel Co. Charge : Unfair methods of
competition are charged in that respondent, by acquiring all the outstanding common capital
stock of the Imperial Wheel Co., tends to sub-

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137

stantially lessen competition between the respondent and said Imperial Wheel Co., to restrain
commerce in the sale of automobile wheels in certain territories and to create a monopoly in the
sale and distribution thereof, in alleged violation of section 7 of the Clayton Act. Status : At
issue.
Complaint No. 1226.--In the matter of. Double A Platinum Works (Inc.). Charge: Unfair
methods of competition are charged in that the respondent, engaged in the manufacture of
unfinished jewelry known to the trade as “findings,” stamps said findings as “Double A
Platinum” or “A. A. Plat.”, thereby tending to mislead the trade and public to believe that the
respondent’s products are composed of pure platinum, when in fact they are made of platinum
alloyed with other metals, in alleged violation of section 5 of the Federal Trade Commission act.
Status : Before the commission for final determination.
Complaint No. 1234.--In the matter of Superior Silver Company (Inc.). Charge : Unfair
methods of competition are charged in that the respondent, engaged In the manufacture of silverplated ware by the electroplating process, stamped its product “Superior Sheffield” and held
itself out to be “manufacturers of Sheffield plate silver ware, using the trade-mark “Superior
Sheffield,” thereby tending to mislead the purchasing public to believe that it is a manufacturer
of copper rolled plate similar to that known as “Sheffield,” and that its product is of “Sheffield”
quality, in alleged violation of section 5 of the Federal Trade Commission act. Status: At issue
on amended complaint.
Complaint No. 1238.--In the matter of M. Rea Gano, Gano Moore Co., Gano Moore Coal
Mining Co. (Inc.). Charge: Unfair methods of competition are charged in that the respondents.
engaged in the business of exporting coal from the United States to South America, accepted
orders and received payment from foreign customers for coal of a specified quality and quantity
and willfully or through negligence delivered for the coal so ordered coal of a quality inferior
thereto, failed to make deliveries at the time specified and of the quantities ordered, refused to
make deliveries contracted for except at increased prices, and endeavored to induce customers
to enter into agreements to disregard the export regulations of the United States Government,
thereby tending to bring American trade into disrepute with the South American buying public
and to injure and damage the reputation and business of American exporters, in alleged violation
of the Federal Trade Commission act as extended by the provisions of section 4 of the Webb
Act. Status : At issue.
Complaint No. 1241.--In the matter of Julius Klorfein. Charge : Unfair methods of
competition are charged in that the respondent, engaged in the manufacture of cigars In the
States of New York and Pennsylvania and In the sale thereof, labels his product with the words
“Havana,” “Vuelta Abajo,” and “Garcia” in connection with a design registered by him in the
United States Patent Office as a trade-mark for cigars and causes the said words to appear as a
part of said trade-mark when such is not the fact, thereby tending to mislead and deceive the
purchasing public to believe that the respondent’s cigars are made wholly from tobacco grown
in Cuba and either wholly or In part of tobacco grown in the Vuelta Abajo district by
manufacturers of the surname “ Garcia” and that the respondent was the first, and is entitled to
the exclusive right in the United States, to use the word “Garcia” in connection with the sale of
cigars, all in alleged violation of section 5 of the Federal Trade Commission act. Status :
Awaiting examiners report.
Complaint No. 1242.--In the matter of Jacques E Greenberger and Carrie Greenberger;
Individually and as copartners, trading as Big G Furniture Works, and Big G Furniture Works,
a corporation. Charge : Unfair methods of competition are charged in that the respondents.
engaged in the purchase of furniture and its sale at retail, employ their trade and corporate

names and advertise to mislead the purchasing public to believe that they are manufacturers and
that said purchasing public in dealing with the respondents saves the profits of middlemen, all
in alleged violation of section 5 of the Federal Trade Commission act. Status : Awaiting final
argument.
Complaint No. 1245.--In the matter of B. Z. B. Knitting Co. Charge : Unfair methods of
competition are charged in that the respondent, engaged in the manufacture and sale of hosiery.
advertised Its product as “fashioned” or “full fashioned” hosiery, when in fact said hosiery is not
“fashioned” as the term is understood by the public, thereby tending to mislead and deceive the
purchasing public, in alleged violation of section 5 of the Federal Trade Commission act. Status
: At issue.
Complaint No. 1247.--In the matter of Allied Chemical & Dye Corporation. Charge : Unfair
methods of competition are charged in that respondent by the

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acquisition of the stock or share capital of the Barrett Co., General Chemical Co., the Solvay
Process Co., Semet-Solvay Co., and National Aniline & Chemical Co., (Inc.), tends to
substantially lessen competition, to restrain commerce in various and sundry articles, products,
and chemicals produced by said corporations, and to create in the respondent a monopoly in the
lines of commerce in which said corporations were respectively engaged and especially in the
chemicals and coal-tar products required in the production of dyes and dyestuffs, in alleged
violation of section 7 of the Clayton Act. Status : At issue.
Complaint No. 1251.--In the matter of American Association of Advertising Agencies, its
officers, executive board, and members ; American Press Association, a corporation ; Southern
Newspaper Publishers’ Association, its officers, directors, and members. Charge : Unfair
methods of competition are charged in that the respondents are engaged in a combination and
conspiracy affecting national advertising throughout the United States, entered into with the
purpose of compelling national advertisers to employ respondent agencies or other advertising
agencies in the placing of national advertising in newspapers throughout the United States and
to prevent said advertisers from advertising directly in said newspapers at the minimum “net”
rates and to compel said advertisers to pay at the maximum “gross” rates, employing various
cooperative means to effectuate said combination and conspiracy the effect of which is to hinder
and obstruct national advertising throughout the United States : to restrict the distribution of
such advertising, and of the type parts essential thereto, to channels and upon terms and conditions dictated by the respondents ; to restrict the publication of national advertising to
newspapers selected and approved by the respondents ; to compel newspaper publishers to
charge for the publication of national advertising at maximum gross rates and to prevent them
from according minimum net rates to direct advertisers ; to compel the employment of the
respondents or other agencies as intermediaries in placing national advertising, or in the
alternative to pay for direct advertising at the maximum gross rates and in addition thereto to
prepare and distribute their advertisements at their own expense, and to hinder and obstruct the
marketing of goods, wares, and merchandise, all in alleged violation of section 5 of the Federal
Trade Commission act. Status : In course of trial.
Complaint No. 1258.--In the matter of Grand Rapids Furniture Co., an Illinois corporation.
Charge: Unfair methods of competition are charged in that the respondent falsely represented
and pretended that it owned or operated a furniture factory at Grand Rapids, Mich. ; that It sold
its furniture direct from manufacturer to consumer, thereby eliminating the middleman’s profit;
that Its furniture was made at Grand Rapids, Mich.; that the respondent and the long-established
and favorably known “Grand Rapids Furniture Co.,” of Grand Rapids, Mich., were one and the
same company ; and that the respondent was a selling agency through which the said Grand
Rapids Furniture Co., of Grand Rapids, Mich., sold its furniture to the consuming public; and
in that the respondent in the sale of certain upholstered furniture, the coverings and upholstery
of which were composed entirely of materials and substances other than silk, represent said
coverings and upholstery as “genuine silk mohair,” all in alleged violation of section 5 of the
Federal Trade Commission act. Status : Awaiting briefs.
Complaint No. 1263.--In the matter of National Leather & Shoe Finders’ Association, its
officers, executive committee, and members; Greater Boston and New England Leather and
Finders’ Credit Bureau; Central States Leather and Finders’ Credit Bureau; Central West
Leather and Finders’ Credit Bureau; Northwestern Leather and Finders’ Credit Bureau;
Northern New Jersey Leather and Finders’ Credit Bureau; Wisconsin Leather and Finders’
Credit Bureau; New York State Leather and Finders’ Credit Bureau; Shoe Finders’ Board of
Trade; Colorado Leather and Finders’ Credit Bureau; Pittsburgh Leather and Finders’ Credit

Bureau; Philadelphia Leather and Finders’ Credit Bureau; Baltimore Leather and Finders’ Credit
Bureau; Greater New York Leather and Finders’ Credit Bureau; Capital Leather and Finders’
Credit Bureau of Albany, N. Y.; Michigan Leather and Finders’ Credit Bureau of Detroit;
Illinois Leather and Finders’ Credit Bureau (Inc.); Cleveland Leather and Finders’ Credit
Bureau; Toledo Leather and Finders’ Credit Bureau; Cincinnati Leather and Finders’ Credit
Bureau; St. Louis Leather and Finders’ Credit Bureau; Connecticut Leather and Finders’ Credit
Bureau; Virginia Leather and Finders’ Credit Bureau; Iowa and Nebraska Leather and Finders’
Credit Bureau; Missouri, Kansas, and Arkansas Leather and Finders’ Credit

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Bureau; Illinois State Leather and Finders’ Credit Bureau ; Louisville Leather and Finders’
Credit Bureau; Twin Cities Leather and Finders’ Credit Bureau; Rubber Heel Club of America
and the officers and members thereof. Charge: Unfair methods of competition are charged In
that the respondents have combined and conspired with the intent and effect of discouraging,
stifling, and suppressing competition in price and otherwise in the sale and distribution of shoe
findings and in shoe-repair service, and of confining such commerce to “ regular” channels of
trade and “legitimate” dealers, in alleged violation of section 5 of the Federal Trade Commission
act. Status : At issue.
Complaint No. 1267.--In the matter of G. H. Koppel, doing business under the trade name and
style Cuban-American Sponge Co. Charge: Unfair methods of competition are charged in that
the respondent, engaged in the purchase and sale of chamois-leather and sponges, falsely
indicates on its business stationery and literature that it is a chamois tanner and manufacturer
and operates chamois tanneries and sponge fishing fleets when in fact it is not engaged but
purchases its leathers and sponges for resale, thereby tending to mislead and deceive the
purchasing public, in alleged violation of section 5 of the Federal Trade Commission act.
Status: Before the commission for final determination.
Complaint No. 1269.--Federal Trade Commission v. Shanghai Lace Corporation. Charge:
Unfair methods of competition are charged in that the respondent, engaged in the importation
of lace from China and in the sale thereof to the manufacturers of garments, describes its lace
as “Irish picot,” “Irish edge,” and “Real Irish edge,” thereby misleading and deceiving the
purchasing public as to the quality and value of respondent’s product and tending to injure
competitors who are in fact importers of Irish lace, in alleged violation of section 5 of the
Federal Trade Commission act. Status: In course of trial.
Complaint No. 1270.--In the matter of Nanyang Bros, (Inc.). Charge: Unfair methods of
competition are charged in that the respondent, engaged in the importation of lace from China
and the sale thereof to garment manufacturers, designates its lace as “Irish lace,” thereby
misleading and deceiving the purchasing public as to the quality and value of respondent’s
product and tending to injure competitors who are in fact importers of Irish lace, in alleged
violation of section 5 of the Federal Trade Commission act. Status: At issue.
Complaint No. 1271.--In the matter of Wadeeh Rizcallah, Selin Katin, Badie Katin, partners
doing business under the trade name and style W. Rizcallah & Co. Charge: Unfair methods of
competition are charged in that the respondents, engaged In the importation of lace from China
and the sale thereof to garment manufacturers, designate their lace as “Irish picot,” “Irish
beading,” and “Real Irish edge,” thereby misleading and deceiving the purchasing public as to
the quality and value of respondent’s product, and tending to injure competitors who are in fact
importers of Irish lace, in alleged violation of section 5 of the Federal Trade Commission act.
Status: At issue.
Complaint No. 1272.--In the matter of N. B. Bardwil, T. B. Bardwil, M. Bardwil, partners
doing business under the trade name and style N. B. Bardwll & Co. Charge: Unfair methods of
competition are charged in that the respondent, engaged in the importation of lace from China
and the sale thereof to garment manufacturers, designates its lace as “Irish lace,” thereby
misleading and deceiving the purchasing public as to the quality and value of respondent’s
product and tending to injure competitors who are in fact importers of Irish lace, in alleged
violation of section 5 of the Federal Trade Commission act. Status: At issue.
Complaint No. 1273.--In the matter of. Abraham D. Sutton, David Sutton, Selim Sutton,
partners doing business under the trade name and style A. D. Sutton & Sons. Charge: Unfair
methods of competition are charged in that the respondents, engaged in the importation of lace

from China and the sale thereof to garment manufacturers, designate their lace as “Irish picot,”
“Irish beading,” and “Real Irish edge,” thereby misleading and deceiving the purchasing public
as to the quality and value of respondent’s product, and tending to injure competitors who are
in fact importers of Irish lace, in alleged violation of section 5 of the Federal Trade Commission
act. Status: In course of trial.
Complaint No. 1274.--In the matter of Alfred Kohlberg (Inc.). Charge: Unfair methods of
competition are charged In that the respondent, engaged in the importation of lace from China
and the sale thereof to garment manufacturers, designates its lace as “Irish Swatow” and “Irish
Siccawei,” thereby tending to mislead and deceive the purchasing public as to the

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quality and value of the respondent’s product and to injure competitors who are in fact importers
of Irish lace, in alleged violation of section 5 of the Federal Trade Commission act. Status: In
course of trial.
Complaint No. 1275.--In the matter of Abraham Lian, George Marabak, R. Lian, William
Lian, Michael Marabak, Joseph Marabak, John Marabak, Sahid Lian, partners doing business
under the trade name and style Lian & Marabak. Charge: Unfair methods of competition are
charged in that the respondents, engaged in the importation of lace from China and the sale
thereof to manufacturers of garments, designate their lace as “Irish lace,” thereby misleading and
deceiving the purchasing public as to quality and value of respondents’ product and tending to
injure competitors who are in fact importers of Irish lace, in alleged violation of section 5 of the
Federal Trade Commission act. Status: In course of trial.
Complaint No. 1276.--Federal Trade Commission v. Robert M. Lease Co. (Inc.), Lease Bros.
Motor Co. (Inc.), Acoma Motors Co. (Inc.), Lease Motors Co. (Inc.), Lease Motors Export Sales
Corporation, Panther Motor Co. (Inc.), Exporters and Importers Association of the World,
Robert M. Lease, Irving Lease, Albert Lease, and John P. Agnew. Charge: Unfair methods of
competition are charged in that the respondents, falsely representing themselves as
manufacturers and vendors of new motor trucks and automobiles and contracting for the sale
thereof for export with standard factory equipment and right-hand drive, made a practice of
shipping motor trucks which were not new, many of the parts being old, used, rusted, or
secondhand parts, and without complete factory equipment and right-hand drive, gave buyers
no opportunity for examination or inspection of trucks prior to shipment, and refused to refund
payments in excess of agreed of prices or for trucks returned or rejected for reason; and in that
the respondent Lease Bros. Motor Co. (Inc.), by falsely representing that it had entered into the
purchase of plant and equipment obtained a contract for the sale of certain chassis and the
payment of earnest money thereon, when in fact it had not entered Into the purchase of said
properties and did not at any time intend to perform the said contract. thereby tending to bring
discredit and loss of business to American manufacturers seeking foreign trade, all in alleged
violation of section 5 of the Federal Trade Commission act. Status: In course of trial.
Complaint No. 1281.--In the matter of Thomas E Powe, and F. C. Harrington, partners, doing
business under the firm name and style Thomas E. Powe Lumber Co. Charge: Unfair methods
of competition are charged in that the respondents, engaged in the sale of lumber and wood
products, have advertised and represented certain of their products as mahogany when in fact
they consist of woods other than mahogany but resembling mahogany In general appearance,
thereby tending to mislead and deceive the purchasing public and to injure competitors who
represent lumber and wood products truthfully, in alleged violation of section 5 of the Federal
Trade Commission act. Status: Before the commission for final determination.
Complaint No. 1282.--In the matter of Twinplex Sales Co., a corporation. Charge: Unfair
method of competition are charged in that the respondent, engaged in the manufacture and sale
of safety razor blade stoppers, offered and gave sums of money to salesmen in the employ of
retail merchants, without the knowledge or consent of their employers, to induce said salesmen
to sell the respondent’s product to the exclusion of the products of its competitors, in alleged
violation of section 5 of the Federal Trade Commission act. Status: At issue.
Complaint No. 1283.--In the matter of Non-Plate Engraving Co. (Inc.), a corporation. Charge:
Unfair methods of competition are charged in that the respondent. engaged in the printing of
stationery, indicates by the use of its corporate name and its advertising matter that it is engaged
in the business of engraving when in fact the process used by the respondent is not one of
engraving but involves printing to simulate the impression made from engraved plates, in

alleged violation of section 5 of the Federal Trade Commission act. Status: At issue.
Complaint No. 1289.--In the matter of F. Burkhalter, an individual doing business under the
trade name and style Royal Soap Co. Charge: Unfair methods of competition are charged In that
the respondent advertises and represents Its “Royal Medicated Cuticle Doctor Soap” as a highgrade medicated toilet soap of the regular value of 25 cents per cake, containing various
ingredients having a curative and healing effect upon the skin, when in fact said soap is not
medicated, is of the reasonable value of not more than 10 cents

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141

a cake, at which price it is habitually sold by retailers, and contains no ingredients having a
curative and healing effect, thereby tending to mislead and deceive the purchasing public as to
the quality and value of respondent’s product and to injure competitors who do not misrepresent
their soaps, In alleged violation of section 5 of the Federal Trade Commission act. Status: At
issue.
Complaint No. 1290.--In the matter of Abrasive Paper and Cloth Manufacturers’ Exchange,
its officers and members. Charge: Unfair methods of competition are charged in that the
respondents are engaged in an unlawful combination and conspiracy entered into with the
purpose and intention of unduly enhancing the prices of abrasives and of fixing uniform prices,
terms, and discounts at and upon which the abrasives manufactured by the members should be
sold, and of stifling and suppressing competition in the sale and distribution of abrasives, in
alleged violation of section 5 of the Federal Trade Commission act. Status: Before the
commission for final determination.
Complaint No. 1292.--In the matter of Calumet Baking Powder Co. Charge: Unfair methods
of competition are charged in that the respondent, engaged in the manufacture and sale of baking
powders, has caused to be set forth statements and innuendoes untruthfully and unfairly representing that its competitor, Royal Baking Powder Co., packs its Royal Baking Powder in 6 and
12 ounce cans, instead of one-half pound and pound cans, for the purpose of cheating the public
by passing off and causing the trade to pass off said 6 and 12 ounce cans as and for one-half
pound and pound cans, respectively; and in that the respondent has adopted the practice of
disseminating statements and comments calculated to further the interests of respondent and in
disparagement and derogation of the products and businesses of its competitors, concealing its
connection with the various methods through which said practice was carried into effect; and
further in that the respondent falsely represented that the baking powder of its competitor, Royal
Baking Powder Co., forms or tends to form a hard mass In the digestive tract in persons
consuming food prepared therewith, its house-to-house canvassers and demonstrators making
misleading comparisons and tests to deceive the purchasing public, all in alleged violation of
section 5 of the Federal Trade Commission act. Status: At issue.
Complaint No. 1293.--In the matter of Progress Paint Manufacturing Co., a corporation, and
Regulation Paint Co., a corporation. Charge: Unfair methods of competition are charged In that
the respondents label certain of their products with the words “Regulation Paint” and “Camp
Mixed Paint” In connection with a shield or insignia simulating that which appears on the flag
of the President of the United States or as is commonly used and recognized by the public as an
insignia of the United States Government, thereby tending to mislead and deceive the purchasing
public to believe that the respondent’s products were declared and sold as surplus paint by the
United States Government or manufactured in accordance with Army specifications or
Government requirements; and in that the respondents have marketed their products through socalled Army and Navy stores, thereby furthering the deception, all in alleged violation of section
5 of the Federal Trade Commission act. Status: Before the commission for final determination.
Complaint No. 1295.--In the matter of Chipman Knitting Mills, a corporation, and Chas.
Chipman’s Sons Co. (Inc.), a corporation. Charge: Unfair methods of competition are charged
in that the respondents’ “seamless” hosiery is falsely represented as “form fashioned” hosiery,
thereby tending to mislead and deceive the purchasing public and to injure competitors who do
not misrepresent their product, in alleged violation of section 5 of the Federal Trade
Commission act. Status: In course of trial.
Complaint No. 1298.--In the matter of Wickwire-Spencer Steel Corporation. Charge: Unfair
methods of competition are charged in that the respondent acquired the entire capital stock of

the American Wire Fabrics Corporation which succeeded to the business of the American Wire
Fabrics Co., a competitor of the respondent, thereby tending to eliminate competition, to restrain
commerce in the sale and distribution of screen wire cloth and to create a monopoly, in alleged
violation of section 7 of the Clayton Act. Status: At issue
Complaint No. 1299.--In the matter of Heywood-Wakefield Co. Charge: Unfair methods of
competition are charged in that the respondent, engaged in the manufacture of furniture,
perambulators and other like articles which con-

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sist in whole or in part of a woven fabric resembling wicker-work, advertises and represents its
wares as “wicker” wares when in fact the material used by the respondent is wood-paper pulp
processed and worked into a form resembling withes or cordage, thereby tending to deceive the
trade and purchasing public and to injure competitors who do not misrepresent their products,
in alleged violation of section 5 of the Federal Trade Commission act. Status: At issue.
Complaint No. 1301.--In the matter of Windsor Cigar Co.; Benjamin Paris, doing business
under the trade name and style, Paris Cigar Co.; Raphael N. Paris. Charge: Unfair methods of
competition are charged in that the respondents engaged in the manufacture of cigars in the State
of Pennsylvania and in the sale thereof, label their product “Havana Cadet,” thereby tending to
mislead the purchasing public to believe that said cigars are made of tobacco grown on the
island of Cuba and to injure competitors who do not misbrand their products, in alleged
violation of section 5 of the Federal Trade Commission act. Status: Awaiting examiner’s report.
Complaint No. 1306.--In the matter of Maud B. Clough and W. H. Siebrecht, Jr., partners
doing business under the trade name and style Siewin Co. Charge: Unfair methods of
competition are charged in that the respondents, engaged in the manufacture and sale of a
depilatory, falsely advertise and represent that their product kills and destroys the roots of the
hair, thus preventing its regrowth, thereby tending to mislead and deceive the purchasing public
and to injure competitors who do not misrepresent their products, in alleged violation of section
5 of the Federal Trade Commission act. Status: Before the commission for final determination.
Complaint No. 1308.--In the matter of Arnold Electric Co. Charge: Unfair methods of
competition are charged in that the respondent, engaged In the manufacture and sale of
electrically driven drink-mixing machines, has enforced a merchandising system adopted by it
of fixing and maintaining specified uniform prices for the resale of Its machines by dealers,
refusing to supply price-cutters and employing cooperative means for the maintenance of its
resale prices, thereby tending to suppress competition and to deprive the ultimate purchasers of
advantages in price which would obtain from the natural and unobstructed flow of commerce
in said machines under conditions of free competition, in alleged violation of section 5 of the
Federal Trade Commission act. Status: Awaiting examiners report.
Complaint No. 1311.--In the matter of Masland Duraleather Co., W. & J. Sloane. The
respondent Masland Duraleather Co. Is engaged in the manufacture of imitation leather and the
sale thereof through the respondent W. & J. Sloane. Charge: Unfair methods of competition are
charged in that the respondents brand and label a coated fabric, made in imitation of but
containing no leather, as “Duraleather,” thereby enabling vendees to misrepresent articles made
of respondents’ product and injuring the business of competitors who do not practice
misrepresentation; and in that the respondents’ trade name “Duraleather” simulates the trade
name “Duro,” used for many years by their competitor A. C. Lawrence Leather Co., in advertising and selling Its product as “Duro leather,” thereby tending to mislead and deceive the trade
into the belief that the respondents’ product is a product of the aforesaid competitor, all in
alleged violation of section 5 of the Federal Trade Commission act. Status: At issue.
Complaint No. 1313.--In the matter of W. Harris Thurston (Inc.). Charge: Unfair methods of
competition are charged in that the respondent, engaged in the importation and sale of cotton
shirt fabrics, offers and sells under the trade name of “Nusylk” a certain imported fabric which
has the appearance of silk but is made from cotton and contains no silk whatever, the words “all
cotton” or “superfine cotton” appearing in small and inconspicuous letters in conjunction with
said trade name, thereby tending to mislead the trade and to injure competitors who do not
practice misrepresentation, in alleged violation of section 5 of the Federal Trade Commission
act. Status: Awaiting examiner’s report.

Complaint No. 1314.--In the matter of S. Goodman and B. Cohen, partners doing business
under the trade name and style Goodman, Cohen & Co. Charge: Unfair methods of competition
are charged in that the respondents, engaged in the manufacture and sale of shirts, use a cotton
fabric containing no silk whatever, but which has the appearance of silk, and label the shirts
made therefrom with the name “Nusylk” (the words “all cotton” or “superfine cotton” appearing
in small and inconspicuous letters), thereby tending to mislead the purchasing public to believe
that the respondents’ shirts are made of

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silk and to injure competitors who do not practice misrepresentation, in alleged violation of
section 5 of the Federal Trade Commission act. Status: At issue.
Complaint No. 1315.--In the matter of A. Herskowitz, Morris Goldberg, Samuel Bell, partners
doing business under the trade name and style, Bell Cap Co. Charge: Unfair methods of
competition are charged in that the respondents, engaged in the manufacture and sale of shop
caps, label and advertise said product as “union made” when in fact the respondents do not
employ members of any labor union in the manufacture of said shop caps, thereby tending to
mislead and deceive the trade and consuming public and to injure competitors who do not
practice misrepresentation, in alleged violation of section 5 of the Federal Trade Commission
act. Status: Awaiting respondent’s brief.
Complaint No. 1316.--In the matter of Indiana Quartered Oak Co. Charged: Unfair methods
of competition are charged in that the respondent, engaged in the sale of lumber and wood
products, sells woods other than mahogany, but resembling mahogany In general appearance,
as “mahogany” or “Philippine mahogany,” thereby tending to mislead the purchasing public and
to injure competitors who do not practice misrepresentation, in alleged violation of section 5 of
the Federal Trade Commission act. Status: Before the commission for final determination.
Complaint No. 1317.--In the matter of Reuben Berman, doing business under the trade name
and style, Silktex Hosiery Mills. Charge: Unfair methods of competition are charged in that the
respondent, engaged in selling direct to the consuming public, labels its hosiery with the words
“Silktex “ and “ Silk “ when in fact said hosiery is composed of but 15 per cent of silk and is
interwoven with other material which Is not true silk but which resembles silk in general
appearance; and in that the respondent Indicates by the use of its business name that it operates
mills and manufactures its hosiery thus saving the consumer the profits of middlemen, when in
fact the respondent is not a manufacturer and does not own or operate any mill or mills but
purchases its hosiery for resale, thereby tending to mislead the purchasing public and to injure
competitors who do not practice misrepresentation, in alleged violation of section 5 of the
Federal Trade Commission act. Status: Awaiting respondent’s brief.
Complaint No. 1319.--In the matter of West Coast Theatres ( Inc. ). West Coast Theatres
(Inc.) of Northern California, Venice Investment Co., Holly wood Theatres (Inc.), All Star
Feature Distributors (Inc.), Educational Film Exchange Principal Pictures Corporation H. M.
Turner Fred Dahnken, C. L. Langley, and F. W. Livingston, partners, doing business under the
name and style of Turner D. Dahnken & Langley, and Messrs. A. L. Gore, Michael Gore Sol.
Lesser, Adolph Ramish and Dave Bershon. Charge: Unfair methods of competition are charged
in that the respondents combined for the purpose of preventing producers or distributors of
motion-picture films in other States from leasing their films to competitors of the respondents
and from shipping said films into the State of California, and preventing competition in
negotiating for and leasing of said motion-picture films, employing threats, coercive measures,
and other cooperative and individual means to make effective the aforesaid undertakings, in
alleged violation of section 5 of the Federal Trade Commission act. Status : Awaiting briefs.
Complaint No. 1320.--In the matter of West Coast Theatres (Inc.), West Coast Theatres (Inc.)
of Northern California, The T. & D. Jr. Enterprises (Inc.), and H. M. Turner, Fred Dahnken, C.
L. Langley, and F. W. Livington, partners, doing business under the trade name and style of
Turner, Dahnken & Langley. Charge: Unfair methods of competition are charged in that the
respondents combined for the purpose of restraining and preventing producers or distributors
of motion-picture films in other States from leasing their films to competitors of the respondents
and from shipping said films into the State of California for delivery to respondents’
competitors, and restraining and preventing competition in negotiation for and leasing of said

motion-picture films, in the respondents effecting joint management of their Theatres,
recognizing restrictive territorial arrangements, observing agreements to refrain from
competition, and employing coercive and other cooperative and individual means to make
effective their undertakings in alleged violation of section 5 of the Federal Trade Commission
act. Status : Awaiting briefs.
Complaint No. 1322.--In the matter of Pacific Southwest Import Co. Charge: Unfair methods
of competition are charged in that respondent has

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products, at wholesale and retail, to dealers in hardwood lumber, manufacturers of furniture, and
other users of hardwood lumber under the name and designation of “Philippine mahogany,” and
in advertisements, circular letters, and other correspondence with purchasers and prospective
purchasers, on letterheads, invoices, price lists, and other trade literature, has represented,
named, and designated, and continues to represent, name, and designate, said hardwood lumber
and other hardwood products as “ Philippine mahogany,” when in truth and in fact said
hardwood lumber and other hardwood products so sold by it are not mahogany wood, in alleged
violation of section 5 of the Federal Trade Commission act. Status : At issue.
Complaint No. 1323.--In the matter of Kirschmann Hardwood Co. Charge: Unfair methods
of competition are charged in that respondent has sold, and continues to sell certain hardwood
lumber and other hardwood products, at wholesale and retail, to dealers in hardwood lumber,
manufacturers of furniture, and other users of hardwood lumber, under the name and designation
of “Philippine mahogany,” and in advertisements, circular letters, and other correspondence with
purchasers and prospective purchasers, on letterheads, invoices, price lists, and other trade
literature, has represented, named, and designated, and continues to represent, name, and
designate, said hardwood lumber and other hardwood products as “Philippine mahogany” when
in truth and in fact said hardwood products so sold by it are not mahogany wood, in alleged
violation of section 5 of the Federal Trade Commission act. Status : At issue.
Complaint No. 1324.--In the matter of Hammond Lumber Co. Charge: Unfair methods of
competition are charged in that respondent has sold, and continues to sell, certain hardwood
lumber and other hardwood products, at wholesale and retail, to dealers in hardwood lumber
manufacturers of furniture, and other users of hardwood lumber under the name and designation
of “Philippine mahogany,” and in advertisements, circular letters, and other correspondence with
purchasers and prospective purchasers, on letterheads, invoices, price lists, and other trade
literature, has represented. named and designated, and continues to represent, name, and
designate, said hardwood lumber and other hardwood products as “ Philippine mahogany,” when
in truth and in fact said hardwood lumber and other hardwood products so sold by it are not
mahogany wood, in alleged violation of section 5 of the Federal Trade Commission act. Status
: At issue.
Complaint No. 1325.--In the matter of The Robert Dollar Co. Charge: Unfair methods of
competition are charged in that respondent has sold, and continues to sell, certain hardwood
lumber and other hardwood products, at wholesale and retail, to dealers in hardwood lumber
under the name and designation of “Philippine mahogany,” and in advertisements, circular
letters, and other correspondence with purchasers and prospective purchasers, on letter heads,
invoices, price lists. and other trade literature, has represented, named, and designated, and
continues to represent, name, and designate, said hard wood lumber and other hardwood
products as "Philippine mahogany,” when in truth and in fact said hardwood lumber and other
hardwood products so sold by it are not mahogany wood, in alleged violation of section 5 of the
Federal Trade Commission act. Status : At issue.
Complaint No. 1326.--In the matter of D. A. Horn and J. M. Hyson, partners, doing business
under the trade name and style “Tampa Cigar Co.” Charge : Unfair methods of competition are
charge in that the respondents, engaged in the manufacture of cigars in Pennsylvania and the
sale thereof in interstate commerce, label their cigars and their containers with various names
and legends in Spanish, including the word “Tampa,” or the word “Havana” thereby tending to
mislead the public into the belief that such cigars are made in the Tampa district, Florida, or are
made wholly of tobacco grown on the island of Cuba, respectively, whereas such cigars are
made in Pennsylvania and are composed wholly of tobacco grown elsewhere than in Cuba; and

in that the respondents indicate, without basis therefor that one of their products was awarded
a “Double Grand Prize, St. Louis Exposition. 1904,” thereby tending to mislead the trade and
public, and to injure competitors who do not practice misrepresentation, in alleged violation of
section 5 of the Federal Trade Commission act. Status : Awaiting respondent’s brief.
Complaint No. 1328.--In the matter of National Cash Register Co. Charge: Unfair methods
of competition are charged in that the respondent has inaugurated and systematically conducted
a plan and scheme to unduly hinder and restrain competition in the manufacture and sale of cash
registers and similar

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145

machines, to monopolize or attempt to monopolize said manufacture and sale, to eliminate, stifle
and force out of said business the Remington Gash Register Go. and to harass and discourage
the agents and employees of said competitor; carrying out its plan against the Remington Gash
Register Co. by (a) ascertaining the names of its customers and prospective customers; (b)
making false and misleading statements in disparagement of said company and its products; (e)
tampering with the Remington Co.’s cash registers; (d) under taking to persuade and induce
customers of the Remington Co. to breach their contracts with said company; (e) representing
the Remington Co.’s executory contracts of purchase as not binding on the customers; (f)
offering to accept Remington cash registers in the possession of customers under executory contracts at a substantial valuation in money as part of the purchase price for cash registers of
respondent’s manufacture and offering the latter at prices greatly below the normal retail prices;
(g) circulating false statements and representations concerning the business of the Remington
Cash Register Co. and its financial stability, and by means thereof, as well as by means of
threats, intimidation, and persuasion, attempting to induce employees to violate and terminate
their contracts with said Remington Co.; and (h) practicing espionage against sale Remington
Co. and its employees, all in alleged violation of section 5 of the Federal Trade Commission act.
Status: In course of trial.
Complaint No. 1329.--In the matter of The Armand Co., its officers and agents; SpurlockNeal Go., Berry, DeMoville & Go., Robinson-Pettet Go., Lamar & Rankin Drug Go., GreinerKelly Drug Go., The J. W. Growdus Drug Go., San Antonio Drug Go., Western Wholesale Drug
Go., Fuller-Morrison Co., Ilumiston, Keeling & Go., Peter Van Schaack & Sons, The McPike
Drug Co., Faxon-Gallagher Drug Go., J. S. Merrell Drug Go., A. M. Berry, A. D. Berry, F. S.
Berry, W. D. Phillips, M. P. Williams, copartners doing business under the trade name of Berry,
DeMoville & Go., The Fair (Inc.), E. H. Cone (Inc.), T. C. Marshall, doing business under the
name of Marshall’s Pharmacy, Clarence E. Jeffares and Malcolm J. Long, copartners, doing
business under the trade name of Jeffares-Long Drug Go., Owl Drug Co. (Inc.). Charge: Unfair
methods of competition are charged in that the respondent The Armand Go., engaged in the
manufacture of toilet articles and cosmetics, and the respondent wholesalers and dealers,
unlawfully and knowingly conspired and agreed to monopolize and restrain interstate trade in
the products of The Armand Co. by selling the Said products at uniform, noncompetitive,
wholesale and retail prices arbitrarily suggested and fixed by The Armand Co. and largely in
excess of the prices which would have prevailed without such agreement, refusing to sell said
products to dealers other than those engaged in the drug business, ref using to sell to price
cutters and employing cooperative means for the enforcement of the said suggested or fixed
prices, in alleged violation of section 5 of the Federal Trade Commission act. Status: At issue.
Complaint No. 1330.-In the matter of Plateless Engraving Co. (Inc.). Charge: Unfair methods
of competition are charged in that the respondent, engaged in process printing and in the sale
of process printed stationery, uses the word “Engraving” in its corporate name, and thereby
tends to mislead and deceive the purchasing public into the erroneous belief that the respondent’s stationery is “engraved,” and tends to injure competitors who do not misrepresent their
products, in alleged violation of section 5 of the Federal Trade Commission act. Status: At issue.
Complaint No. 1331.--In the matter of W. R. Maxwell, trading under the name of International
Publishing Co. Charge: Unfair methods of competition are charged in that the respondent,
engaged in the purchase and sale of a publication entitled “International Reference Work,”
makes numerous false and misleading statements as to his publication of said work; the cities
in which he has places of business; the authors of said work; date of publication; binding; sales
price; looseleaf extension service; enrollment of purchasers in the International Research
Bureau, a nonexistent organization; testimonial letters, and indorsement by educators; and in
that the respondent agrees to maintain resale prices, and by means of trickery induces customers

to give negotiable promissory notes and enforces payment thereof, all in alleged violation of
section 5 of the Federal Trade Commission] act. Status: Awaiting commission’s brief.
Complaint No. 1332.--In the matter of Jones Hardwood Co. Charge: Unfair methods of
competition are charged in that the respondent, engaged in the sale of hardwood lumber and
other hardwood products, represented and sold as “Philippine mahogany” certain hardwoods
which were not mahogany

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

wood, thereby tending to mislead the trade and the purchasing public and to injure competitors
who do not practice misrepresentation, in alleged violation of section 5 of the Federal Trade
Commission act. Status: Before commission for final determination.
Complaint No. 1334.--In the matter of E R. Marshall, doing business under the trade name
and style of Crescent Calendar Co. Charge: Unfair methods of competition are charged in that
the respondent in soliciting orders for school commencement announcements and invitations
represents that the name of the school will be “process embossed in gold” or “embossed in
gold,” when in fact the announcements and invitations are prepared for the respondent by the
embossing of a design from steel dies or plates, leaving a blank space In which the name of the
school is process printed by the respondent without the use of dies or plates but in simulation
of embossing, in alleged violation of section 5 of the Federal Trade Commission act. Status: At
issue.
Complaint No. 1335.--In the matter of Aluminum Co. of America, a corporation. Charge:
Unfair methods of competition are charged in that the respondent, controlling the sources of
supply of aluminum metal and, through its subsidiaries, a large manufacturer of aluminum
products. discriminates in price between purchasers of virgin sheet aluminum on the basis or
agreements that all aluminum scrap resulting from the operations of the purchasers shall be
resold to the respondent, thereby tending to substantially lessen competition and create a
monopoly, in alleged violation of section 2 of the Clayton Act; and in that the respondent fixes
prices arbitrarily, makes price concessions, sells below cost, and discriminates against
competitors in the quantity and quality of its deliveries to them, thereby unfairly harassing
competitors and tending to suppress competition and maintain a monopoly, in alleged violation
of section 5 of the Federal Trade Commission act. Status: In course of trial.
Complaint No. 1338.--In the matter of Spear & Co. Charge: Unfair methods of competition
are charged in that the respondent advertised and sold certain of its furniture as “mahogany,”
“combination mahogany,” “genuine mahogany,” “finished in mahogany.” “combination golden
oak,” “combination walnut,” “two-tone walnut,” and “French walnut finish,” when in fact said
furniture consisted wholly or in part of woods other than those designated, thereby tending to
mislead the purchasing public and to injure competitors who do not misrepresent their products,
in alleged violation of section 5 of the Federal Trade Commission act. Status: At issue.
Complaint No. 1339.--In the matter of Ludwig Baumann & Co. Charge: Unfair methods of
competition are charged in that the respondent sold certain of Its furniture as “French walnut
combination” and as “mahogany combination,” when in fact said furniture consisted wholly or
in part of woods other. than those designated, thereby tending to mislead the purchasing public
and to injure competitors who do not misrepresent their products, in alleged violation of section
5 of the Federal Trade Commission act. Status: At issue.
Complaint No. 1340.--In the matter of Marion Tool Works (Inc.). Charge: Unfair methods
of competition are charged in that the respondent, engaged in the manufacture and sale of tools,
advertises and sells certain of its products as “Crecoite steel tools,” when in fact the metal parts
of the respondent’s said tools are not composed of steel but are composed of a metal other than
steel, thereby tending to mislead and deceive the purchasing public and to injure competitors
who do not practice misrepresentation, in alleged violation of section 5 of the Federal Trade
Commission act. Status: At issue.
Complaint No. 1341.--In the matter of Sheppard Knapp Son Co. (Inc.). Charge: Unfair
methods of competition are charged in that the respondent sold certain of its furniture as
“mahogany,” when in fact said furniture consisted of wood other than “mahogany,” thereby
tending to mislead the purchasing public and to injure competitors who do not misrepresent their
products, in alleged violation of section 5 of the Federal Trade Commission act. Status: At issue.
Complaint No. 1342.--In the matter of George M. Rubinow, trading under the name and style

of Rubinow Edge Tool Works. Charge: Unfair methods of competition are charged in that
respondent, engaged in the business of manufacturing tools, makes use of the term “steel,” “cast
steel,” etc., in advertising and branding tools composed of a metal other than steel. Status: At
issue.
Complaint No. 1343.--In the matter of Wholesale Grocers Association of New Orleans, its
officers and members. Charge: Unfair methods of competition are charged in that the
respondents have cooperated to confine the distribution of

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147

groceries and allied products in the territories served by the respondent members to so-called
regular and legitimate channels of trade and to prevent irregular and illegitimate dealers from
obtaining groceries directly from manufacturers and producers, carrying out said purposes by
threats of boycott and other methods of intimidation and coercion against manufacturers,
brokers, and agents and by espionage and other cooperative and individual efforts, thereby
tending to suppress competition and obstruct the natural flow of commerce, in alleged violation
of section 5 of the Federal Trade Commission act. Status: At issue.
Complaint No. 1342.--Not released.
Complaint No. 1345.--Not released.
Complaint No. 1346.--In the matter of Con-Ferro Paint & Varnish Co. Charge : Unfair
methods of competition are charged in that the respondent, engaged in the manufacture and sale
of paints, makes numerous false and mis leading statements as to the quality and value of its
products, thereby tending to mislead the purchasing public and to injure competitors who do not
misrepresent their products, in alleged violation of section 5 of the Federal Trade Commission
act. Status : At issue.
Complaint No. 1350.--In the matter of B. J. Sackheim and Mary Rae Sackheim, partners,
doing business under the trade name and style of Norman Roberts & Co. Charge : Unfair
methods of competition are charged in that the respondents, engaged in the sale of wearing
apparel direct to consumers by mail, advertise and represent certain fur scarves as consisting of
Manchurian fox, lynx, or wolf, when in fact said scarves are made of other pelts inferior in
quality and value, and in that the respondents offer other garments as wool serge, or woolfinished serge, or as made of silk, when in fact cotton is the principal material used, thereby
tending to mislead the purchasing public and to injure competitors who do not practice
misrepresentation, in alleged violation of section 5 of the Federal Trade Commission act. Status
: At issue.
Complaint No. 1351.--In the matter of Simon B. Bluest ne and Samuel L. Bluestine, partners,
doing business under the trade names and styles Nustile Hosiery Mills and Nustile Hosiery Co.
Charge : Unfair methods of competition are charged in that the respondents, engaged in the sale
of hosiery direct to the consuming public, represent themselves as manufacturers when in fact
they neither own nor operate any factory or mill and purchase their hosiery for resale, and in that
the respondents misrepresent the quality and fashioning of certain of their hosiery, thereby
tending to mislead the consuming public and to injure competitors who do not practice
misrepresentation, all in alleged violation of section 5 of the Federal Trade Commission act.
Status: At issue.
Complaint No. 1352.--In the matter of Leroy A. Kling, John E Weddell, William R. Durgin,
Cecil Widdefield, copartners, doing business under the trade names and styles Dr. Eagan
Manufactory, Dr. S. J. Eagan, Dr. Eagan Laboratory, Pharmaceutical Products (Ltd.). KlingGibson Co., a corporation, Charge : Unfair methods of competition are charged in that the
respondents, engaged in the business of selling cosmetics, creams, lotions, and other toilet
preparations, misrepresent their products and make numerous false and fraudulent statements
in behalf of such preparations, the ingredients and medicinal properties thereof, and as to the
results to be obtained therefrom, thereby tending to mislead the consuming public and to injure
competitors who do not practice misrepresentation, in alleged violation of section 5 of the
Federal Trade Commission act. Status : At issue.
Complaint No. 1354.--In the matter of J. L. Heaps. trading under the name Civil Service
Correspondence School. Charge : Unfair methods of competition are charged in that the
respondent advertises under the trade name “Civil Service Correspondence School,” and asserts
or implies connection with the United States Government or the Civil Service Commission, and
that his courses of instruction are approved by the Government or its cornmission, and, further,

in that the respondent causes to be depicted on his catalogues and advertising literature pictorial
representations of the United States Capitol Building, the caricature known as “Uncle Sam,” and
a shield emblematical of the United States Government, when in fact the respondent has no
relationship with the Government, thereby misleading the public as to the status of the
respondent’s courses of instruction and his qualifications, in alleged violation of section 5 of the
Federal Trade Commission act. Status : Before the commission for final determination.
Complaint No. 1356.--In the matter of Gotham Silk Hosiery Co. (Inc.). Charge : Unfair
methods of competition are charged in that the respondent.

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engaged in the manufacture and sale of silk hosiery, has adopted a merchandising system of
establishing and maintaining specified uniform prices for the resale of its hosiery, refusing to
sell to price cutters, and employing cooperative means for the enforcement of its system of price
maintenance, in alleged violation of section 5 of the Federal Trade Commission act. Status : At
issue.
Complaint No. 1357.--In the matter of Miles F. Goodman, doing business under the trade
name and style Keystone Furniture Co. Charge : Unfair methods of competition are charged in
that the respondent sells certain of his furniture as mahogany or walnut, when in fact said
furniture is made wholly of woods other than mahogany and walnut, thereby tending to mislead
the purchasing public and to injure competitors who do not practice misrepresentation, in
alleged violation of section 5 of the Federal Trade Commission act, Status : At issue.
Complaint No. 1359.--In the matter of La Fayette Institute (Inc.). Charge : Unfair methods of
competition are charged in that the respondent, engaged in teaching business management and
administration by mail, made false, misleading, and deceptive statements concerning its course
of study by making on its stationary and advertising the statement “La Fayette Institute (Inc.),
La Fayette Building, Philadelphia, Pa.,” implying that respondent owns, controls, or occupies
the entire building, whereas it occupies one room only therein; implies that its course of study
is under the administration of various departments, when in fact there is only one; states that it
maintains a large and efficient staff of professors, instructors, and experts. but really conducts
its business through its officers and sundry employees who are not professors or instructors; and
offers a “special price” for its course, which is in fact no less than its regular price to all persons
alike, all in alleged violation of section 5 of the Federal Trade Commission act. Status: At issue.
Complaint No. 1360.--In the matter of Carlton Soap Co. (Inc.). Charge: Unfair methods of
competition are charged in that the respondent, engaged in the sale of toilet and bath soaps,
labels certain of its soap as “British bath” soap, when in fact the said soap is manufactured in
the United States, thereby tending to mislead and deceive the purchasing public and to injure
competitors who do not practice misrepresentation, in alleged violation of section 5 of the
Federal Trade Commission act. Status : Awaiting answer.
Complaint No. 1361.--In the matter of H. S. Cruikshank. Charge : Unfair methods of
competition are charged in that the respondent represents and offers for sale as timothy hay of
the best grade and quality hay of a grade and quality inferior to said timothy hay, thereby
tending to mislead and deceive the purchasing public and to injure competitors who do not
practice misrepresentation, in alleged violation of section 5 of the Federal Trade Commission
act. Status: At Issue.
Complaint No. 1362.--In the matter of Charles Kurlan. Charge : Unfair methods of
competition are charged in that the respondent, engaged in the sale of cloth and fabrics to
manufacturers of men’s shirts, names and designates as “Tabsylk” a fabric composed wholly of
cotton and supplies labels bearing said designation to his vendees, which labels are attached to
the men’s shirts manufactured by them, thereby tending to mislead and deceive the purchasing
public and to injure competitors who do not practice misrepresentation, in alleged violation of
section 5 of the Federal Trade Commission act. Status : Awaiting answer.
Complaint No. 1363.--In the matter of The Daisy Products (Inc.). Charge : Unfair methods
of competition are charged in that the respondent, engaged in the manufacture and sale of hand
baggage, advertises and represents its “Daisy hat bags” as made of patent leather, when in fact
the said hat bags are made of materials other than patent leather and are covered with a woven
fabric the exposed surface of which is coated and finished to resemble patent leather in
appearance, thereby tending to mislead the purchasing public and to injure competitors who do
not practice misrepresentation, in alleged violation of section 5 of the Federal Trade
Commission act. Status: Awaiting briefs.

Complaint No. 1364.--In the matter of Atlanta Wholesale Confectioners Association, its
officers and members, Brower Candy Co., A. B. Tenenbaum, J. L. Tenenbaum, and J. P.
Tenenbaum, partners, doing business under the trade names and styles Tenenbaum Bros.,
Sugarman-Hirsch Go., Cohen Bros. Co., T. S. Lewis Co., Harry L. Schlesinger, members of said
association. Charge : Unfair methods of competition are charged in that the respondents have
cooperated to confine distribution of confectionery to so-called regular

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149

and legitimate channels of trade and to the respondent members as whole-sale dealers, to prevent
so-called irregular and illegitimate dealers (doing both a wholesale and retail business or retail
business only) from obtaining confectionery and allied products directly from the manufacturers
thereof and to suppress competition and especially competition in price in the sale and
distribution of said products, employing cooperative means to make effective their undertaking
and threatening to boycott and otherwise seeking to persuade and compel manufacturers to sell
their products to members of respondent association only and to refrain from selling to irregular
or illegitimate dealers, all in alleged violation of section 5 of the Federal Trade Commission act.
Status: In course of trial.
Complaint No. 1366.--In the matter of Eclipse Fountain Pen & Pencil Corporation, Marx
Finstone, Lillian Finstone, David Klein. Charge : Unfair methods of competition are charged
in that the respondents, engaged in the manufacture and sale or fountain pens and pencils, label
certain of their products with fictitious and exaggerated resale prices, thereby tending to mislead
and deceive the consuming public as to the value of said products and to injure competitors who
do not practice misrepresentation, in alleged violation of section 5 of the Federal Trade
Commission act. Status : Awaiting examiner’s report.
Complaint No. 1367.--In the matter of Commonwealth Manufacturing Co.-and Harry Dushoff,
doing business under the trade names and styles Harry Dushoff & Co. and Chicago
Manufacturing Co. Charge : Unfair methods of competition are charged in that the respondents,
engaged in the sale of binder twine, shirts, and shoes, describe themselves as “manufacturers”
of the commodities dealt in, when in fact the respondents are not manufacturers but purchase
said commodities for resale; and, further, in that respondents sell certain of their shoes as “Army
shoes,” when in fact the said shoes are not surplus property of the United States Government but
were obtained by the respondents from the manufacturers thereof in the ordinary course of trade,
thereby tending to mislead and deceive the purchasing public and to injure competitors who do
not practice misrepresentation, in alleged violation of section 5 of the Federal Trade
Commission act. Status : Awaiting answer.
Complaint No. 1368.--In the matter of Korean H. Basmadjian, doing business under the trade
name and style H. Basmadjian & Sons. Charge: Unfair methods of competition are charged in
that the respondent, engaged in the sale of pistachio nuts, makes numerous false and misleading
statements and representations to the effect that H. Basmadjian & Sons are the growers of the
pistachio nuts in which they deal and that their nuts are of better and higher quality than
pistachio nuts bought in the open market in the ordinary course of trade, when in fact the
respondent never has grown or produced pistachio nuts, thereby tending to mislead the
purchasing public and to injure competitors who do not practice misrepresentation, in alleged
violation of section 5 of the Federal Trade Commission act. Status : Awaiting answer.
Complaint No. 1369.--In the matter of W. U. Blessing, and M. S. Gohn, co-partners, doing
business under the trade name and style of W. U. Blessing & Co., and A. E. Wallick. Charge
: Unfair methods of competition are charged in that the respondents, engaged in the manufacture
of cigars in the State of Pennsylvania and in the sale thereof, label their “Triangulares” cigars
and containers with the word “Garcia” and the words “Tampa Style,” thereby tending to mislead
the purchasing public as to the quality of the respondents’ product and the place of manufacture
and to injure competitors who do not practice misrepresentation, in alleged violation of section
5 of the Federal Trade Commission act. Status : In course of trial.
Complaint No. 1371.--In the matter of Perpetual Encyclopedia Corporation, North America
Publishing Co. (Inc.), et al. Charge : Unfair methods of competition are charged in that the
respondents republished without substantial change the “Home and School Reference Work”
(originally copyrighted in 1912 or 1915) under different names and as a new and up-to-date
(1924) edition, employing without right the names of attorneys, fictitious corporate

organizations, and collection agencies to further the sale of said publication and to assist in
coercing and blackmailing purchasers into the payment of money on orders or contracts,
substituting late copyright registration dates for the actual date of such registration, falsely
stating that well-known educators, scientists, and public officials are members of the editorial
staff and contributors, mis representing and grossly exaggerating sales prices, obtaining signed
orders

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by subterfuge, misrepresenting the quality of the paper and binding, offering additional books
or extension service “free,” when in fact the price thereof was included in the price of the book
bought, and making numerous false and misleading representations, all tending to deceive the
purchasing public, the said practices injuring competitors who do not practice misrepresentation,
in alleged violation of section 5 of the Federal Trade Commission act. Status : At issue.
Complaint No. 1372.--In the matter of Synthetic Products Co. Charge: Unfair methods of
competition are charged in that the respondents, engaged in the manufacture and sale of a
compound for use in softening rubber and rendering the same more resilient, labels and
advertises its product as “Liquid Rubber,” when in fact the said product contains no rubber
whatsoever, thereby tending to mislead and deceive the purchasing public, in alleged violation
of section 5 of the Federal Trade Commission act. Status : Awaiting final argument
Complaint No. 1373.--In the matter of Public Service Cup Co. Charge : Unfair methods of
competition are charged in that the respondent, engaged in the manufacture and sale of paper
drinking cups, dishes, and like products, enforces a merchandising system adopted by it of
establishing and maintaining certain specified uniform prices for the resale of its products,
refusing to supply price cutters and employing cooperative means and methods for the
enforcement of said system of resale prices, in alleged violation of section 5 of the Federal
Trade Commission act. Status : In course of trial.
Complaint No. 1374.--In the matter of M. Samuels Co. ( In.). Charge : Unfair methods of
competition are charged in that the respondent, engaged in the manufacture and sale of shoes,
brands and advertises the soles of certain of its shoes as “Tufhide,” when in fact the said soles
are made of a material and composition other than and containing no leather, thereby tending
to mislead and deceive the purchasing public and to injure competitors who do not practice
misrepresentation in alleged violation of section 5 of the Federal Trade Commission act. Status
: At issue.
Complaint No. 1375.--In the matter of Union Woolen Milks Co., Racine, Wis., Union Woolen
Mills Co., Jackson, Mich., Max Cohen. Charge : Unfair methods of competition are charged in
that the respondents by the use and display of the names of the respondent companies,
incorporated by respondent Cohen for the purpose of jointly conducting with him an interstate
business in the manufacture and sale at retail of men’s clothing, tend to mislead and deceive the
purchasing public into the belief that the respondents manufacturer the cloth used by them in the
manufacture of their clothing and that persons buying from the respondents are buying directly
from the manufacturers of the cloth and clothing, thereby saving the profits of middlemen, in
alleged violation of section 5 of the Federal Trade Commission act. Status : Awaiting answer.
Complaint No. 1376.--In the matter of Great Lakes Rubber Products Co. Charge : Unfair
methods of competition are charged in that the respondent, engaged in the manufacture and sale
of a compound for use in softening rubber and rendering the same more resilient, labels and
advertises its product as “ Rublierite Compound,” when in fact the said product contains no
rubber whatsoever, thereby tending to mislead and deceive the purchasing public, in alleged
violation of section 5 of the Federal Trade Commission act. Status : Awaiting final argument.
Complaint No. 1377.--In the matter of H. Reisman & Co., a corporation, and Harry Reisman,
individually and as president of respondent H. Reisman & Co. Charge : Unfair methods of
competition are charged in that the respondents, engaged in the sale of watches, jewelry, and
other articles of merchandise by mail. make numerous false and misleading statements and
representations concerning the character and quality of their merchandise and the value thereof,
describing certain articles as composed in whole or in part of precious metals and ornamented
with precious stones, when in fact said articles contain no precious metals and are not
ornamented with precious stones, representing other articles as made, covered, or finished with
leather, when in fact no heather is used, or made of ivory and French ivory, when in fact no

ivory is used, and further in that the respondents take misleading statements and representations
as to prices and values, thereby tending to deceive the purchasing public, and to injure
competitors who do not practice misrepresentation, in alleged violation of section 5 of the
Federal Trade Commission act. Status : Awaiting answer.
Complaint No. 1378.--In the matter of Ohio Leather Co. Charge : Unfair methods of
competition are charged in that the respondent, engaged in the

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151

manufacture and sale of leather, advertises and labels one of its products as “Kaffor Kid,” thus
indicating that it is manufactured from the skins of goats, when in fact the respondent’s said
product is manufactured from the hides of calves, thereby tending to mislead and deceive the
trade and consuming public and to injure competitors who do not practice misrepresentation,
in alleged violation of section 5 of the Federal Trade Commission act. Status : At issue.
Complaint No. 1379.--In the matter of Great Northern Fur Dyeing & Dressing Co. Charge :
Unfair methods of competition are charged in that the respondent, engaged in the business of
dressing and dyeing Australian and New Zealand rabbit skins, causes one of its trade-marks-“Northern Seal” (black), “Northern Bevre” (brown), “Northern Nutrette” (plum color)--to be
stamped on the back of each skin prepared by It, and furnishes to manufacturers of garments
made from such skins silk labels containing the words “Genuine Northern Seal,” thus placing
in the hands of dealers who sell to the public garments made from such skins the means
whereby such dealers can commit a fraud on the public by displaying such labels and trademarks to support their false representations that such garments are made from genuine seal fur
or the fur of animals other than rabbits; the tendency being to deceive the purchasing public and
to divert trade from competitors who properly label their rabbit skins, and from dealers in the
skins of seals, beavers, musk rats, etc., all in alleged violation of section 5 of the Federal Trade
Commission a ct. Status : At issue.
Complaint No. 1380.--In the matter of Feldbaum & Spiegel (Inc.). Charge : Unfair methods
of competition are charged in that the respondent, engaged in the business of manufacturing and
selling to dealers garments made of dyed Australian and New Zealand rabbit skins, on the back
of each of which skin is stamped the dyer’s trade-mark “Northern Seal" and to which garments
are attached silk labels bearing the words “Genuine Northern Seal,” thus placing In the hands
of dealers the means whereby a fraud on the public may be committed by displaying the labels
and trade-marks to customers to support their false representations that the garments are made
of genuine seal fur; the tendency being to deceive the purchasing public and to cause trade to
be diverted from competitors who disclose that the garments made by them are made of rabbit
fur, all in alleged violation of section 5 of the Federal Trade Commission act. Status : At issue.
Complaint No. 1381.--In the matter of Golden Fur Dyeing Co. (Inc.), and Samuel Jacobs and
Isidor Sachs, partners, doing business under the trade name and style Jacobs & Sachs. Charge
: Unfair methods of competition are charged in that the respondents, engaged in the business of
(1) dressing and dyeing Australian and New Zealand rabbit skins for the owners, and (2)
manufacturing and selling garments made therefrom, cause the trade-mark containing the words
“ Golden Seal “ to be stamped on the back of each skin prepared by the dyer respondent, many
of which skins are owned by the manufacturing respondent and made up by it into garments for
sale to the trade, thus placing in the hands of the dealers who sell the garments to the public the
means whereby such dealers can commit a fraud on the public by displaying such trade-mark
to support their false representations that such garments and made from genuine seal fur; the
tendency being to deceive the purchasing public and to divert trade from competing
manufacturers of properly marked garments made of rabbit skins, or from those who manufacture and sell garments made of genuine seal fun, and in alleged violation of section 5 of the
Federal Trade Commission act. Status: At issue.
Complaint No. 1382.--In the matter of Cassileth, Schwartz & Cassileth (Inc.), Joseph Brickner
and Julius Bernfeld, partners, trading as Brickner & Bernfeld, Samuel Oldman and Max
Oldman, partners trading as Oldman Bros. Charges: Unfair methods of competition are charged
in that respondents, engaged in the business of (1) dressing and dyeing Australian and New
Zealand rabbit skins for the owners thereof, (2) dealing mm the skins so dressed and dyed, and
(3) manufacturing and selling garments made from the skins so dressed and dyed and dealt in
case the trademark “Iceland Seal” or “Iceland Beaver” to be stamped on the back of each skin

prepared by the dyer respondent, many of which are so prepared on contract for the dealer
respondent who sells some of the same to the manufacturing respondent, thus placing in the
hands of dealers who sell the garments made from the “Iceland Seal” skins to the public the
means whereby a fraud on the public can be committed by permitting them to display such trademark to support their false representations that such

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

garments are made from genuine seal fur; the tendency being to deceive the purchasing public
and to divert trade from competing manufacturers of properly marked garments made of rabbit
skins, or from those who manufacture and sell garments made of genuine seal fur, all in alleged
violation of section 5 of the Federal Trade Commission act. Status: At issue.
Complaint No. 1383.--In the matter of Adiel Vandeweghe and David Feshback. Charge:
Unfair methods of competition are charged in that (1) the dyer respondent and (2) the
manufacturing respondent (who purchases a substantial number of skins from the former)
engaged in dressing and dyeing Australian and New Zealand rabbit skins and the manufacture
and sale to the trade of garments made therefrom cause each of such skins to be marked on the
back thereof the trade-mark “Superior Seal,” thus placing in the hands of dealers who sell such
garments to the public the means whereby such dealers can commit a fraud on the public by
displaying such trade-mark to support their false representations that the garments are made
from genuine seal fur; the tendency being to deceive the purchasing public and to divert trade
from competing manufacturers of properly marked garments made of rabbit skins, or from those
who manufacture and sell garments made of genuine seal fur, all in alleged violation of section
5 of the Federal Trade Commission act. Status : Awaiting answer.
Complaint No. 1384.--In the matter of Philip A. Singer & Bro. (Inc.), and Herman Gelberg
and Benjamin Schwartz, partners, doing business under the name and style Gelberg & Schwartz.
Charge : Unfair methods of competition are charged in that (1) the dyer respondent and (2) the
manufacturing respondent (for whom the former dresses and dyes many skins) engaged in the
dressing and dyeing of rabbit skins and the manufacture and sale to the trade of garments made
therefrom cause the trade-mark “Baltic Seal” or “Baltic Beaver “ to be stamped on the back of
each skin prepared by the dyer respondent, thus placing in the hands of dealers who sell the
garments made from such skins the means whereby such dealers can commit a fraud on the
public by displaying such trade-marks to support their false representations that the garments
are made from genuine seal fur or from genuine beaver fur; the tendency being to deceive the
purchasing public and to divert trade from competing manufacturers or properly marked garment
made from rabbit skins, or from those who manufacture and sell garments made of genuine seal
or beaver fur, all in alleged violation of section 5 of the Federal Trade Commission act. Status
: At issue.
Complaint No. 1385.--In the matter of A. Hollander & Son (Inc.), A. Hollander & Son-Arnold
Corporation, and Harry H. Hertz Co. Charge : Unfair competition is charged in that the
respondents engaged in the business of (1) dressing and dyeing muskrat skins on contract for
the owners, (2) dressing and dyeing Australian and New Zealand rabbits largely imported by
itself, and (3) manufacturing and selling fur garments, cause each skin prepared by the dyer
respondents to be stamped on the back thereof with the trade-marks “Hollander Seal” or “Bay
Seal,” and as many of such skins are sold to the manufacturing respondent there is placed in the
hands of dealers the means of perpetrating a fraud on the purchasing public by displaying such
trade-marks to support their false representations that the garments are made from genuine seal;
the tendency being to deceive the public and to divert trade from competing manufacturers of
properly marked garments made of muskrat or rabbit skins, or from those who manufacture and
sell garments made of genuine seal fur, all in alleged violation of section 5 of the Federal Trade
Commission act. Status : At issue.
Complaint No. 1386.--In the matter of C. A. Leitch Manufacturing Co. Charge : Unfair
methods of competition are charged in that the respondent, engaged in the manufacture of
roofing materials, sells its roofing paint, also called fluid cement, as and for a composition or
mixture of Natural or Trinidad Lake Asphalt and Gilsonite with other substances, when in fact
it contains neither Natural or Trinidad Asphalt nor Gilsonite, thereby tending to mislead and
deceive the purchasing public and to injure competitors who do not practice misrepresentation,

in alleged violation of section 5 of the Federal Trade Commission act. Status : Awaiting answer.
Complaint No. 1387.--In the matter of Reading Saddle & Manufacturing Co. Charge: Unfair
methods of competition are charged in that the respondent, engaged in the manufacture of tools,
advertises, labels, and sells certain of its products as “steel," "converted steel,” or “solid steel,”
when in fact the said tools are not composed of steel and are composed of a metal other than
steel.

COMPLAINTS PENDING JULY 1, 1926, AND STATUS

153

thereby tending to mislead and deceive the purchasing public and to injured competitors who
do not practice misrepresentation in alleged violation of section 5 of the Federal Trade
Commission act. Status : At Issue.
Compliant No. 1388.--In the matter of T. V. Aaron, trading under the name and style Home
Art Co. Charge : Unfair methods of competition are charged in that the respondent engaged in
the business of selling so-called pictures falsely states and represents in advertisements placed
in magazines of wide circulation that for selling 24 pictures at 10 cents each there will be given
as a premium a genuine American stem wind and set watch with a 10-year time guarantee, ring,
and chain, and also that there was being given as a premium for selling his pictures “A
handsome white gold, 6-jewel, silver dial, Vanity movement, 25-year case, wrist watch,”
whereas the watch given contains no gold and is without a chain and ring and the wrist watch
given contains no gold, has three jewels only, and neither its works nor Its case is capable of
service or use for a period of 25 years or any substantial portion thereof, the effect of which Is
to mislead the unwary and to injure competitors who do not misrepresent the premiums given
by them all in alleged violation of section 5 of the Federal Trade Commission act. Status :
Awaiting answer.
Complaint No. 1389.--Not released.
Complaint No. 1390.--Not released.
Complaint No. 1391.--Not released.

EXHIBIT 8
STIPULATIONS PUBLISHED AFTER DELETING NAME OF
RESPONDENTS
(The purpose of the following releases is to inform the public of those unfair methods and
practices condemned by the commission and to establish precedents that will serve to eliminate
unfair business methods of interest to the public and injury to competitors.)
STIPULATION OF THE FACTS AND AGREEMENTS TO CEASE AND DESIST
STIPULATION NO. 1, APRIL 15, 1925
MAINTENANCE OF RESALE PRICES: SOFT DRINKS
Respondent, a copartnership, engaged in the manufacture of soft-drink beverages and in the
sale of same In commerce between and among various States of the United States, and in
competition with other individuals, firms, partnerships, and corporations also engaged in the sale
of similar products, entered into the following stipulation of facts and agreement to cease and
desist for ever from the alleged unfair methods of competition used in the sale of said product.
Respondent represented that it was engaged in the manufacture of soft-drink beverages and
in the sale of said product in commerce to bottlers located in various States of the United States.
In a contract entered into between the respondent and the bottlers of said product it was
understood and agreed that the bottlers would not sell to dealers at a price less than 70 cents per
case of two dozen bottles each; that the purpose of the aforesaid clause is and was to require the
maintenance of a resale selling price.
The respondent agreed to cease and desist forever from the use of the aforesaid contract, and
further agreed to notify all parties bound by said contract that the clause maintaining resale
prices was removed and no longer binding, and the respondent further agreed that if it should
ever resume or indulge in any of the alleged unfair practices as above set forth, or any other
method having for its purpose the maintenance of resale prices, or any other unlawful practices
or methods of establishing a resale-price system, the foregoing statement of facts may be used
in evidence against said respondent.
STIPULATION NO. 2, MAY 13, 1925
FALSE AND MISLEADING BRANDS OR LABELS; BREAD
Respondent agreed to cease and desist forever from the use of labels on Its said products
containing the words “Packed by” or the use of any other word or words that import or imply
that the product sold by it in interstate commerce is and was imported into the United States, and
the use of any other word or words that may have the capacity and tendency to mislead and
deceive the purchasing public into the erroneous belief that the product is baked or
manufactured in a foreign country and imported to the United States and packed by the aforesaid
respondent for distribution in interstate commerce; or until such the as the said respondent
corporation does import or handle an imported product packed by it for sale and distribution in

interstate commerce. It was further agreed that if the respondent should ever resume or indulge
in any of the alleged unfair practices, as above set forth, the foregoing statement of facts may
be used in evidence against it in a proceeding by the Federal Trade Commission.
154

STIPULATIONS PUBLISHED

155

STIPULATION NO. 3, MAY 13, 1925
FALSE AND MISLEADING CORPORATE OR TRADE NAME; KNITTED CLOTHING
Respondent agreed to cease and desist forever from the use of the words “Knitting” and
“Mills” as part of or in connection or conjunction with its corporate or trade name, and also
agreed to cease and desist from the use of the words “Knitting” or “Mills,” either independently
or in connection or conjunction each with the other, or in any other way in soliciting the sale of
and selling its product in interstate commerce that may have the capacity and tendency to
mislead and deceive the purchasing public into the erroneous belief that the respondent
corporation either owns, operates, or controls a mill or factory manufacturing the knitted
clothing sold by It in interstate commerce; or until such the as the aforesaid respondent does
actually own, operate, or control a mill or factory manufacturing the product sold by it. It further
agreed that if it should ever resume or Indulge in any of the practices as set forth above, the
foregoing statement of facts may be used in evidence against it.
STIPULATION NO. 4, JUNE 15, 1925
FALSE AND MISLEADING CORPORATE NAME AND ADVERTISING MATTER;
HOSIERY
Respondent agreed to cease and desist forever from the use of the word “Mills” as part of or
in connection or conjunction with its corporate or trade name, and also agreed to cease and
desist from the use of the slogan “From Mill to Wearer,” and the words “Manufacturers of
Hosiery,” and the use of any other word or words that import or imply that it manufactured the
product sold by it in interstate commerce, and the aforesaid respondent further agreed to cease
and desist forever from the use of the words “fashioned,” “semi-fashioned,” and “form
fashioned,” either independently or in connection or conjunction with any other word or words,
or in any other way in soliciting the sale of and selling its product in interstate commerce that
may have the capacity and tendency to mislead and deceive the purchasing public Into the
erroneous belief that the product sold by it was in truth and in fact “fashioned.” It is further
agreed that if the aforesaid respondent should ever resume or indulge in any of the practices as
set forth above, the foregoing statement of facts may be used as evidence against it.
STIPULATION NO. 5, SEPTEMBER 4, 1925
MAINTENANCE OF RESALE PRICES; CARPETS, RUGS, ETC.
Respondent agreed to cease and desist forever from the maintenance, or aiding In maintaining,
resale prices to be charged for its said product by jobbers and/or retail dealers handling the same
by using the methods as above set forth, or by cooperating with said jobbers and dealers In the
use of such methods; and the said respondent further agreed that It would cease and desist from
cooperating with said jobbers or dealers in response to complaints of price cutting on the part
of their competitors for the purpose of compelling maintenance of such prices; or for the
purpose of cutting off the supplies of such price cutters; or for the purpose of limiting or
restricting such jobbers or dealers complained against in fixing their own prices; and also to
cease and desist from seeking or securing, in cooperation with said jobbers or dealer distributers,
information in regard to price cutting and from requiring price cutters so informed upon to give
promises or assurances for the future maintenance of retail prices or for the discontinuance of

prices fixed or used by such price cutters as a condition for receiving further goods; and also
agreed to cease and desist from using any cooperative methods either directly or through. its
agents or representatives to induce such price-cutting dealers to restore said retail prices and to
maintain the same, and further agreed not to adopt any of the cooperative methods as set forth
herein for limiting or restricting dealers in fixing their own retail prices. Respondent further
agreed that if it jobbers or dealers in fixing their own retail prices. Respondent further agreed

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

that if it should ever resume or indulge in any of the practices as above set forth, the foregoing
statement of facts may be used in evidence against said respondent.
STIPULATION NO. 6, SEPTEMBER 11, 1925
FALSE AND MISLEADING CORPORATE AND TRADE NAMES; CLOTHING
Respondents agreed to cease and desist forever from the use of the word “Mills” as part of or
in connection or conjunction with their corporate or trade names in the sale and distribution of
their products in interstate commerce, and also agreed to cease and desist from the use of the
corporate or trade name containing the word “Mills” in advertisements inserted in newspapers
circulated in interstate commerce and on order blanks, letterheads, and advertising matter, or
the use of the word “Mills” In any other way that may have the capacity and tendency to mislead
and deceive the purchasing public into the erroneous belief that either the principal or subsidiary
corporation owned, controlled, or operated a mill or factory for the manufacture of the cloth
from which the product is made; or until such the as the aforesaid corporations either own,
operate, or control a plant or factory for the manufacture of the cloth from which is made the
product they sell in interstate commerce. It was further agreed that if either or both of the
aforesaid corporations should ever resume or indulge in any of the aforesaid practices, the
foregoing statement of facts may be used in evidence against said respondents.
STIPULATION NO. 7, SEPTEMBER 11, 1925
FALSE AND MISLEADING ADVERTISEMENTS; FURNITURE
Respondent agreed to cease and desist forever from the use of the word “Reed” either
independently or in connection or combination with any other word as a trade name for the sale
of its product in interstate commerce, and further agreed to cease and desist forever from the use
of any other word or words that may have the capacity and tendency to mislead and deceive the
purchasing public into the erroneous belief that the product manufactured by it from wood pulp
cord woven over a wire centered stake or warp was and is manufactured from a vegetable
product known as “Reed.” It was further understood and agreed that If the said respondent
should ever resume or indulge in the practices as set forth above, the foregoing statement of
facts may be used as evidence against it in the trial of the complaint which the commission may
issue.
STIPULATION NO. 8, SEPTEMBER 11, 1925
FALSE AND MISLEADING CORPORATE AND TRADE NAME; CLOTHING
Respondent agreed to cease and desist forever from the use of the word “Mills” as part of or
in connection or conjunction with its corporate or trade name in the sale of its product in
interstate commerce, and also agreed to cease and desist from the use of its corporate or trade
name in advertisements inserted in newspapers circulated in interstate commerce and on order
blanks, letterheads, and advertising matter, and the use of the word “Mills” in any other way that
may have the capacity and tendency to mislead and deceive the purchasing public into the
erroneous belief that the aforesaid respondent owns, controls, or operates a mill or factory for
the manufacture of the cloth from which the product sold by it is made; or until such the as the
aforesaid respondent does actually own, operate, or control a mill or factory manufacturing the

product sold by it in interstate commerce. It is further agreed that if it should ever resume or
indulge in any of the practices as set forth above, the foregoing statement of facts may be used
in evidence against said respondent.

STIPULATIONS PUBLISHED

157

STIPULATION NO. 9, SEPTEMBER 11, 1925
FALSE AND MISLEADING CORPORATE AND TRADE NAME; KNITTED
CLOTHING
Respondent agreed to cease and desist forever from the use of the word "Knitting" as part of
or in connection or conjunction with its corporate or trade name in the sale of Its product in
interstate commerce, and also agreed to cease and desist from the use of its corporate or trade
name in advertisements inserted in newspapers circulated in interstate commerce and on its
order blanks, letterheads, and other printed matter, and the use of the word “Knitting” in any
other way that my have the capacity and tendency to mislead and deceive the purchasing public
into the erroneous belief that the aforesaid respondent owns, controls, or operates a mill or
factory for the manufacture of the knitted clothing which it sells in interstate commerce ; or until
such the as the aforesaid respondent does actually own, operate, or control a mill or factory
manufacturing the product sold by it. It is further agreed that if it should ever resume or indulge
in any of the practices as set forth above, the foregoing statement of facts may be used in
evidence against said respondent.
STIPULATION NO. 10, SEPTEMBER 11, 1925
FALSE AND MISLEADING LABELS AND FORMULAS; PAINTS AND KINDRED
PRODUCTS
Respondents agreed to cease and desist forever from the use of the words “Best quality 100%
pure” and from the use of formulas on the said brands or labels of said products that do not
correctly represent the constituent elements and/or percentage or quantity of such elements
composing said products unless or until said products so marked and/or labeled are 100% pure
and contain the constituent elements and/or the same percentage or quantity as represented by
the formulas as printed thereon. Respondents further agreed not to make use of formulas in any
other way that may have the capacity and tendency to mislead and deceive the purchasing public
as to the true constituent elements and/or percentage or quantity of such elements composing
the said products sold in interstate commerce. It was further agreed that if the said respondent
should ever resume or indulge in any of the practices as set forth above, the foregoing statement
of facts may be used as evidence against said respondent.
STIPULATION NO. 11, SEPTEMBER 11,1925
FALSE AND MISLEADING CORPORATE OR TRADE NAME; TAILORED
CLOTHING
Respondent agreed to cease and desist forever from the use of the word “Mills” as part of or
in connection or conjunction with its corporate or trade name, and also agreed to cease and
desist from the use of the word “Mills” either independently or in any other way that may have
the capacity or tendency to mislead and deceive the purchasing public Into the erroneous belief
that the said respondent either owns, operates, or controls a mill or factory for the manufacture
of the cloth from which the product sold by it in interstate commerce is made. It further agreed
that If it should ever resume or indulge in any of the practices as set forth above, the foregoing
statement of facts may be used as evidence against it.

STIPULATION NO.12, SEPTEMBER 11, 1925
FALSE AND MISLEADING ADVERTISEMENTS AND FICTITIOUS PRICE MARKS;
IMITATION PEARL NECKLACES
Respondents agreed to cease and desist forever from inserting advertisements in publications
in soliciting the sale of and selling its product wherein the containers of the aforesaid product
were pictorially represented. stamped, or marked, “Price $50.00,” and respondent also agreed
to cease and desist from

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

the use of the word and figures, “Price $50.00” as a brand or price mark for their aforesaid
product sold in interstate commerce, or any other word, words, or figures that directly assert or
clearly import or imply that the aforesaid product is intended to be and/or is sold and/or intended
to be sold at the aforesaid fictitious price as advertised and/or stamped or marked thereon, or
any other word, words, or figures in their advertisements, circulars, and other printed matter
circulated in interstate commerce that may have the capacity and tendency to mislead and
deceive the purchasing public into the erroneous belief that the aforesaid product was intended
to be sold and/or is sold at the aforesaid fictitious price as advertised and labeled by the
aforesaid respondents, and/or that the price or prices for which the same is sold by the said
respondents, and/or their vendees, is substantially below the value or the aforesaid price as
marked on the said boxes or containers in which the aforesaid product is sold. It was further
understood and agreed that if the aforesaid respondent should ever resume or indulge in any of
the practices as set forth above, the foregoing statement of facts may be used as evidence against
them in the trial of the complaint which the commission may issue.
STIPULATION NO. 13, SEPTEMBER 11, 1925
FALSE AND MISLEADING CORPORATE OR TRADE NAME, KNITTED CLOTHING
Respondent agreed to cease and desist forever from the use of the words “Knitting”“ and
“Mills” either independently or in conjunction each with the other or In any other way in
soliciting the sale of and selling its product in interstate commerce so as to import or imply that
the aforesaid respondent either owned, operated, or controlled a mill or factory manufacturing
the knitted clothing sold by it in commerce. It further agreed that if it should ever resume, or
indulge in any of the practices as set forth above, the foregoing statement of facts may be used
in evidence against it.
STIPULATION NO. 14, SEPTEMBER 11, 1925
FALSE AND MISLEADING CORPORATE NAME AND OTHER
MISREPRESENTATIONS.
HOSIERY AND KNITTED CLOTHING
Respondent agreed to cease and desist forever from the use of the words “Knitting” and
“Mills” together or separately as part of, or in connection with, its corporate name in the sale
of its product in interstate commerce, and also agreed to cease and desist from representing that
its product was sold direct from mill to consumer. Said respondent further agreed to cease and
desist from the use of the words “wool fleeced” in advertising or describing garments not made
of wool; and from the use of the words “Kamel Koat” or other similar designations in the sale
of garments not made from camel’s hair; and from the use of the words “Fibre Silk” or other
designation containing the word “Silk” upon any goods or garments not made of genuine silk,
the product of the Silk worm. Respondent further agreed that if it should ever resume or indulge
in any of the practices named herein, or in any manner violate the terms of this stipulation, then
in any proceeding before the commission the facts herein stated shall be deemed to have been
proved and their truth admitted by the introduction of this stipulation in evidence.
STIPULATION NO. 15, SEPTEMBER 11, 1925
FALSE AND MISLEADING TRADE NAME; KNITTED CLOTHING

Respondent agreed to cease and desist forever from the use of the words “Knitting” or “Mills”
either independently or in conjunction each with the other as part of or in connection or
conjunction with his trade name, and the use of the aforesaid words on his order blanks, price
lists, letterheads, and other advertising matter circulated in interstate commerce in soliciting

STIPULATIONS PUBLISHED

159

the sale of and selling his product, or the use of the words “Knitting” or “Mills” in any other way
that may have the capacity and tendency to mislead and deceive the purchasing public into the
erroneous belief that the aforesaid respondent owned, operated, or controlled a mill or factory
manufacturing the knitted clothing sold by him. Respondent also agreed that if he should ever
resume or indulge in any of the practices as set forth above, the foregoing statement of facts may
be used in evidence against him.
STIPULATION NO. 16, SEPTEMBER 11, 1925
FALSE AND MISLEADING BRANDS AND LABELS ; BLANKETS
Respondents agreed to cease and desist forever from the use of the word "Woolen" in their
trade brand or label, or any other word that may have the capacity and tendency to mislead and
deceive the purchasing public into the erroneous belief that the product sold by them in
commerce between and among various States of the United States is fabricated entirely from
wool. Respondents also agreed that if they should ever resume or indulge in any of the practices
in question, this said stipulation of facts may be used in evidence against them in the trial of a
complaint which the commission may issue.
STIPULATION NO. 17, SEPTEMBER 11, 1925
FALSE AND MISLEADING BRANDS AND LABELS; BLANKETS
Respondent agreed to cease and desist forever from the use of the words “Wool” or “Woolen”
as part of its trade brand or label either independently or in conjunction each with the other, or
the use of the words “Wool” or “Woolen” with any other word or words in its trade brands or
labels in designating or defining its products not manufactured entirely from wool and sold by
it in commerce between and among various States of the United States, or the use by said
respondent of any other word or words in its said trade brands or labels that may have the
capacity and tendency to mislead and deceive the purchasing public into the erroneous belief
that the products manufactured by it and sold in commerce between and among various States
of the United States are fabricated entirely from wool. Respondent also agreed that if it should
ever resume or indulge in any of the practices as set forth above, the foregoing statement of facts
may be used as evidence against it.
STIPULATION NO. 18, OCTOBER 5, 1925
FALSE AND MISLEADING BRANDS AND LABELS; MEN’S SHIRTS
Respondent agreed to cease and desist forever from the use of the words “Silk” and/or “Sylk”
in the neck bands of its said shirts, and further agreed to hereafter discontinue the use of the
labels containing the words “Silk” and/or “Sylk” either alone or in combination with any other
words unless the said shirts are manufactured from genuine silk of the silk worm. Respondent
also agreed that if it should ever resume or indulge in any of the practices, as set forth above,
the foregoing statement of facts may be used as evidence against it.
STIPULATION NO. 19, OCTOBER 5, 1925
FALSE AND MISLEADING BRANDS AND LABELS; COTTON FABRICS

Respondent agreed to cease and desist from the use of the word “Linen” either independently
or in connection or conjunction with any other word or words, letter or letters, as a brand or
label for its product, or in any other way to designate or describe the same that directly assert
or clearly import

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

or imply that the product sold by it was manufactured or spun from the fibers of the flax plant
known to the trade and purchasing public as “ Linen,” or the use of any other word or words that
may have the capacity and tendency to mislead and deceive the purchasing public into the
erroneous belief that the product sold by respondent was in truth and in fact linen. Respondent
also agreed that if it should ever resume or indulge in any of the practices as set forth above, the
foregoing statement of facts may be used as evidence against it.
STIPULATION No.20, OCTOBER 5, 1925
FALSE AND MISLEADING ADVERTISEMENTS; STATIONERY
Respondents agreed to cease and desist forever from the use of the word “engraved” or
“engraving” either independently or in conjunction each with the other, or in connection or
conjunction with the word “relief” in defining or describing their products in advertisements or
advertising matter circulated in commerce between and among various States of the United
States and from the use of the words “engraved” and/or “engraving’ in any other way in
soliciting the sale of and selling their products that may have the capacity and tendency to
mislead and deceive the purchasing public into the erroneous belief that the products
manufactured by said respondents are the result of impressions made from inked engraved
plates, known as “engraving.” Respondents also agreed that if they should ever resume or
indulge in any of the practices as set forth above, the foregoing statement of facts may be used
as evidence against them in the trial of a complaint which the commission may issue.
STIPULATION NO. 21, OCTOBER 5, 1925
FALSE AND MISLEADING CORPORATE OR TRADE NAME AND ADVERTISING
MATTER,
HOSIERY
Respondent agreed to cease and desist forever from the use of the word “Linen” as part of or
in connection or conjunction with its corporate or trade name in advertisements and other
printed matter circulated in interstate commerce in soliciting the sale of and selling its product,
and the use of the word “Mills” either independently or in conjunction with any other word or
words in its advertisements and advertising matter, circulated in interstate commerce, that may
import or imply that the said respondent owns, operates or controls a mill or factory
manufacturing the product sold by it ; and the aforesaid respondent also agreed to cease and
desist forever from the use of the word “ Fashioned “ either independently or in connection or
conjunction with any other word or words in its advertisements and advertising matter circulated
in interstate commerce, except in representing or describing that class of hosiery manufactured
by that process used in the manufacture of fashioned hosiery, such hosiery being made to
conform to the shape of the leg, said shaping being accomplished by the dropping of stitches
where the contour of the leg begins to narrow, thereby forming true gussets or “fashion” marks
parallel to the leg seam, which said process of dropping stitches is carried out at the bottom of
the heel, at the instep, the toe, and sometimes just below the garter welt at the back of the knee,
giving in all cases permanent shape effected by knitting. Respondent also agreed that if it
should ever resume or indulge in any of the practices as set forth above, the foregoing statement
of facts may be used as evidence against it.
STIPULATION NO. 22, OCTOBER 5, 1925

FALSE AND MISLEADING ADVERTISEMENTS; BRANDS AND LABELS
Respondent, a corporation engaged in the sale and distribution of fabrics in interstate
commerce and in competition with other individuals, firms, partnerships, and corporations also
engaged in the sale of similar products, entered

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161

into the following stipulation of facts and agreement to cease and desist forever from the alleged
unfair methods of competition used by it in the sale of its product:
Said respondent, in the course and conduct of Its business, sold in interstate commerce a
product which it represented in its advertising matter circulated in interstate commerce as “Silkee Pongee” or as “Sil-kee,” and also caused said product to be designated on its labels as “Silkee Pongee” or as “Silkee,” and with the aforesaid labels affixed thereto sold said product in
inter state commerce; when in truth and in fact the said product did not contain silk either in
whole or in part.
Respondent agreed to cease and desist forever from the use of the words “Sil-kee Pongee” or
the word “Sil-kee” in advertising matter and on labels used in the sale of its product. Respondent
also agreed that If it should ever resume or indulge in any of the practices, as above set forth,
the foregoing statement of facts may be used as evidence against it.
STIPULATION NO. 23, OCTOBER 5, 1925
FALSE AND MISLEADING TRADE NAME ; ADVERTISEMENTS, BRANDS, AND
LABELS
Respondent, an individual engaged in the sale in interstate commerce of a product he
designates “Sheffield Silverware” and “Sheffield Plate” and in competition with other
individuals firms, partnerships, and corporations. entered into the following stipulation or facts
and agreement to cease and desist forever from the alleged unfair methods of competition used
by him in the sale of his product:
Respondent in the sale and distribution of the aforesaid product In interstate commerce,
adopted as part of his trade name the word “Sheffield” which trade name he used in the sale of
his product in interstate commerce, and in the course and conduct of his business he represented
said product in advertisements and other printed matter circulated in interstate commerce as “
Sheffield Silverware” and “ Sheffield Plate,” and the aforesaid respondent also caused the said
product to be stamped or labeled “Sheffield Plate,” and with the aforesaid stamp or label affixed
thereto sold said product in interstate commerce; when in truth and in fact the said product so
represented, stamped, and labeled was and is not made in “Sheffield, England” and/or
manufactured in accordance with the process used in the manufacture of “Sheffield Silverware”
or “Sheffield Plate” and is not of the quality which has been and still is associated with that
grade of silver known to the trade and purchasing public as “ Sheffield Silverware” or “Sheffield
Plate.”
Respondent agreed to cease and desist forever from the use of the word “Sheffield” as part
of or in conjunction with his trade name, and also agreed to cease and desist forever from the
use of the word “Sheffield” in advertisements or advertising matter, or the use of the word
“Sheffield” either independently or in connection or conjunction with the words “Silverware”
or “Plate” as a stamp brand, or label for his product sold in interstate commerce, or the use of
the word “Sheffield” in any other way that directly asserts or clearly imports or implies that the
product sold by him is “Sheffield Silverware” or “Sheffield Plate” and/or made in Sheffield,
England. Respondent also agreed that if he should ever resume or indulge in any of the
practices, as above set forth, the foregoing statement of facts may be used as evidence against
him in the trial of a complaint which the commission may issue.
STIPULATION NO. 24, OCTOBER 5, 1925
FALSE AND MISLEADING REPRESENTATIONS ; BRANDS AND LABELS

Respondent, a corporation engaged in the business of manufacturing soybean and wheat
products and in the sale of the same in interstate commerce in competition with other
individuals, firms, partnerships, and corporations also engaged in the sale of similar products,
entered into the following stipulation of facts and agreement to cease and desist forever from
the alleged unfair methods of competition used by it in the sale of its

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Said respondent, in soliciting the sale of and selling its products in interstate commerce,
caused to be circulated between and among the various States letterheads on which it used the
words “Importers and Manufacturers of Soy” and the aforesaid respondent, also placed and
caused to he placed, upon bottles or containers in which said product was sold, labels bearings
the Words “Sanuki, Japan”; when in truth and in fact said respondent does not import the
manufactured product which it so represents, labels, and sells in interstate commerce, nor does
it own, operate, or control a plant or factory in Japan where such product is produced or
manufactured.
Respondent agreed to cease and desist forever from the use, on its stationery,
advertisements, and otherwise the words “Importers” and/or “Sanuki, Japan”, or the use of any
other word or combination of words that would import or imply that the said respondent Imports
the product which it sells, unless and until such time as the product so advertised, labeled, and
sold in interstate commerce is in truth and in fact imported in accordances with the representations used in the sale of said product. Respondent also agreed that should it ever resume or
indulge in any of the practices in question, this said stipulation as to the facts may be used
against it in a proceeding before the commission.
STIPULATION No. 25, OCTOBER 5, 1925
FALSE AND MISLEADING ADVERTISEMENTS; BRANDS AND LABELS
Respondents, a partnership engaged in the manufacture of cigars and in the sale and
distribution of the same in interstate commerce and in competition with other individuals, firms,
partnerships, and corporations similarly engaged, entered into the following stipulation of facts
and agreement to cease and desist forever from the alleged unfair methods of competition used
by them in the sale of their product:
Said respondents, in the course and conduct of their business, manufactured a cigar which
they represented and designated in advertisements and other printed matter circulated in
interstate commerce under a trade name, brand, or label containing the word “Havana,” and also
caused to be affixed thereto a label in which was included the word “Havana,” and with the s
aid label affixed thereto sold said product in interstate commerce; when in truth and in fact the
said product so represented, advertised, branded, and labeled was not manufactured from
Havana tobacco either in whole or in part.
Respondents agreed to cease and desist forever from the use of the word Havana ,, as
descriptive of its product in advertisements and other printed matter circulated in interstate
commerce, and also the use of the word “Havana” independently or in connection or conjunction
with any other word or words as a brand or label for the product sold in interstate commerce
unless and until the fillers of said cigars were actually manufactured from Havana tobacco.
Respondents also agreed that if they should ever resume or indulge in any of the practices in
question the above facts shall be deemed to be proved and their truth admitted by the
introduction of this stipulation in evidence.
STIPULATION No.26, OCTOBER 5, 1925
FALSE AND MISLEADING ADVERTISING
Respondent, a corporation engaged in the manufacture of cereal products and in the sale
and distribution of the same in commerce between and among various States of the United
States, and in competition with other individuals, firm, partnerships, and corporations, entered

into the following stipulation of facts and agreement to cease and desist forever from the alleged
unfair methods of competition set forth therein:
Respondent, in the course and conduct of its business, manufactured a wheat cereal product
which it sold in interstate commerce under the trade names or brands “Pancake Flour” and
“Waffle Flour “ and in soliciting the sale of and selling said product caused advertisements,
circulars, and other printed matter to be circulated in interstate commerce, in which said
advertising matter said product was represented as “All wheat--it Keeps!”, and also further
repre-

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163

sented that the same contained no corn meal or other substance which will attract the tiny bugs
and worms that get into many cereals in the summer time, and the said product was further
represented in said advertising matter as follows: “Few people care for the taste of corn flour
and every housewife knows that it will not keep well in warm weather, having a tendency to
attract tiny bugs and worms,” and other representations to the effect that corn flour does not
keep well and has a tendency to attract bugs and worms; when in truth and in fact cereals
manufactured from corn flour have no greater tendency to spoil and/or to attract bugs and worms
than the cereal products manufactured from wheat.
Respondent agreed to cease and desist forever from the use of the aforesaid statements in its
advertisements and other printed matter circulated in interstate commerce, wherein
representations were made that cereal products manufactured from corn flour have a greater
tendency to spoil and/or attract bugs or worms than cereal products manufactured by the
respondent from wheat hour, and also from using disparaging representations of comparison to
the effect that cereal products manufactured by competitors from corn flour have a greater
tendency to spoil and/or attract bugs and worms than cereal products manufactured by
respondent. It is further agreed by respondent in case it isolates the provisions of the above
stipulation that the same could be used against it in proceedings by the commission.
STIPULATION NO. 27, OCTOBER 5, 1925
FALSE. AND MISLEADING BRANDS AND LABELS
Respondent, a corporation engaged in compounding or manufacturing a chemical product that
it designates, defines, and describes as “Shellac,” and also in the sale and distribution of the
Same in interstate commerce, and in competition with other individuals, firms, partnerships, and
corporations engaged in the sale of “Shellac” and similar products, entered into the following
stipulation of facts and agreement to cease and desist from the alleged unfair methods of
competition used by it in the sale of said product:
Respondent, in the course and conduct of its business, manufactured or compounded a product
which it sold in interstate commerce under a trade brand or label’ containing the word “Shellac,”
Rand in connection therewith used the words “Strictly Pure, cut with 190 proof specially
denatured alcohol,” “The perfect Shellac,” “A superfine product,” and similar representations;
when in truth and in fact the said product so labeled and sold in interstate commerce was not
compounded or manufactured wholly of genuine shellac gum dissolved in alcohol, but was
compounded or manufactured in accordance with a formula containing constituent elements,
ingredients, or substitutes other than contained in the product known to the trade and purchasing
public as “Shellac.”
Respondent agreed to cease and desist forever from the use of the word “ Shellac” as part of
or in connection with its trade brand or label in the sale of its product in interstate commerce,
and also the use of the words “Strictly Pure” in connection with the word “Shellac “ in defining
and describing its product, or the use of any other word or words, either independently or in
connection or conjunction with the word “Shellac,” that would import or imply that the product
compounded or manufactured by it was made of pure shellac gum dissolved in alcohol
commercially known to the trade and purchasing public as “Shellac,” or until such the as the
aforesaid respondent. does actually compound or manufacture its product from pure shellac gum
dissolved in alcohol. It is also understood and agreed that if the above respondent should ever
resume or indulge in any of the practices in question the foregoing statement of facts may be
used as evidence against it in the trial of a complaint which the commission may issue.

STIPULATION NO. 28, OCTOBER 5, 1925
FALSE AND MISLEADING ADVERTISEMENTS
Respondents, a copartnership engaged in printing stationery by a special process and in the
sale and distribution of printed products in interstate commerce, and in competition with other
individuals, firms, partnerships, and

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corporations selling and distributing printed and engraved products, entered into the following
stipulation of facts and agreement to cease and desist forever from the alleged unfair methods
of competition as set forth therein:
Respondents, in the course and conduct of their business, printed by a special process
stationery products by the means of a printing press, and with the use of a slow drying ink which
was treated with a powdered chemical and later subjected to a heating process that fused the
powder and ink, and when cooled caused it to harden, thereby producing a raised surface so as
to simulate engraving in appearance and finish. The aforesaid respondents advertised the
product so produced in newspapers and periodicals circulated in interstate commerce under the
name “Handgrav,” and also caused the aforesaid trade name to be prominently displayed on
their stationery in soliciting the sale of their product in interstate commerce.
Respondents agreed to cease and desist forever from advertising in interstate commerce their
aforesaid product under the name or designation “Handgrav,” and also from the use of the word
“Handgrav” to define or describe said product, and from the use of any other word or
combination of words as descriptive of said imitation engraving which have or may have the
capacity or tendency to confuse said product with engraving. It is also agreed that if the
aforesaid respondents ever resume the practices mentioned herein or shall in any manner violate
the terms of this stipulation, the facts herein stated, or any of them, shall be deemed to have been
proven and their truth admitted by the introduction of this stipulation in evidence.
STIPULATION No.29, OCTOBER 5,1925
FALSE AND MISLEADING ADVERTISEMENTS; BRANDS AND LABELS
Respondents, copartners engaged in the sale and distribution of hosiery in wholesale and/or
retail quantities and in competition with other individuals, firms, partnerships, and corporations
also engaged in the sale of similar products, entered into the following stipulation of facts and
agreement to cease and desist forever from the alleged unfair methods of competition used by
them in the sale of their products:
Said respondents, in the course and conduct of their business, caused certain hosiery sold by
them in interstate commerce to be represented and described as “Fashioned” in their catalogues,
order blanks, and other advertising matter and on the labels affixed to said product; when in
truth and in fact the said product so represented and described was and is not “fashioned”
hosiery, but hosiery known as the trade and purchasing public as “seamless” hosiery. The
aforesaid respondents in the course and conduct of their business caused certain of the hosiery
sold by them to be represented and described as “Thread Silk with Art Twist” in their
catalogues, order blanks, and other advertising matter circulated in interstate commerce, and
also caused the same to be represented and described as “Thread Silk with Art Twist” on the
labels affixed to said hosier when in truth and in fact the boot of said hosiery so represented and
described and sold in interstate commerce is not composed entirely of silk produced from the
cocoon of the silkworm, but is composed also in varying quantities of fabrics or material other
than silk.
Respondents agreed to cease and desist forever from the use of the word “Fashioned” in their
catalogues, order blanks, and other advertising matter and also on the label affixed to said
product sold in interstate commerce, or any other word or words in describing the aforesaid
hosiery that would have the capacity and tendency to mislead and deceive the purchasing public
into the erroneous belief that the said product is manufactured by that process used in the
manufacture of “Fashioned” hosiery: Respondents also agreed to cease and desist forever from
the use of the words “Thread Silk with Art Twist” in their catalogues, order blanks, and other

advertising matter circulated in interstate commerce and/or on the labels attached to said product
sold in commerce between and among various States of the United States to represent or
describe their said product, the boot of which is not composed entirely of silk produced from
the cocoon of the silkworm, or the use of any other word or words that may have the capacity
and tendency to mislead and deceive the purchasing public into the erroneous belief that the
boot of said product is composed entirely of silk. Respondents further agreed that if they should
ever resume or

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165

indulge in any of the practices in question the foregoing statement of facts may be used in
evidence against them in the trial of a complaint which the commission may Issue.
STIPULATION No. 30, NOVEMBER 2, 1925
FALSE AND MISLEADING ADVERTISEMENTS; BRANDS AND LABELS
Respondent, an individual engaged in making necklaces and in the sale of the same in
interstate commerce, and in competition with other individuals, firms, partners hips, and
corporations also engaged in the sale of similar products, entered into the following stipulation
of facts and agreement to cease and desist forever from the alleged unfair methods of
competition used by him in the sale of his product:
Said respondent, in the course and conduct of his business, caused advertisements to be
inserted in publications having general circulation and also caused circulars and other printed
matter to be circulated in interstate commerce. in which said advertising matter respondent
caused to be inserted a pictorial representation of boxes or containers, in which said product was
sold, which aforesaid pictorial representations included a reproduction of his trade brand or
label followed by the word and figures, “Price $50.00”; also the aforesaid respondent caused
the boxes to be similarly marked or labeled, and with the aforesaid fictitious price mark affixed
thereto sold said product in interstate commerce; when in truth and in fact the said product so
advertised, labeled, and sold in interstate commerce with the aforesaid word and figures “ Price
$50.00” marked thereon, was and is advertised and labeled greatly in excess of the pr ice at
which the aforesaid respondent sells the said product, or contemplates the same to be sold by
his vendees, and greatly in excess of the actual price at which said necklaces sell in the usual
course of trade.
Respondent agreed to cease and desist forever from the use of the word and figures “Price
$50.00” either independently or in connection or conjunction with any other word, words, or
figures in his aforesaid advertisements circulated in interstate commerce, or on his brands or
labels affixed thereto that directly assert or clearly import or imply that the aforesaid product
is sold, and/or intended to be sold at the aforesaid fictitious price as advertised, and/or stamped
or marked thereon, or any other word, words, or figures in his advertisements, brands, or labels
that may have the capacity and tendency to mislead and deceive the purchasing public into the
erroneous belief that the product is intended to and/or is sold at the fictitious price as advertised
and labeled by the said respondent. Respondent also agreed that if he should ever resume or
indulge in any of the practices in question, the fore going statement of facts may be used as
evidence against him in the trial of the complaint which the commission may issue.

EXHIBIT 9
STATEMENTS OF TRADE PRACTICE CONFERENCES
The results of trade practice conferences held prior to June 30, 1925, are embodied in the
commission’s publication entitled “Trade Practice Submittals,” released July 6, 1925.
Following are statements to the public released subsequent to that date:
RETAIL FURNITURE
Announcement--January 7, 1926
Following trade practice submittal conferences conducted by Commissioner Vernon W. Van
Fleet with certain members of the retail furniture trade of New York City, the Federal Trade
Commission has approved rules adopted by the retail dealers for describing and marking
furniture as offered for sale to the public. These rules and interpretations thereof are set forth
in the following communication to the commission:
DECEMBER 29, 1925.
TO THE FEDERAL TRADE COMMISSION:
At a trade practice submittal called by the Federal Trade Commission to consider the proper
trade practices affecting the sale of furniture the undersigned respectfully recommend the
adoption of the following rules:
RULES FOR THE DESIGNATION OF FURNITURE WOODS
I. Furniture in which exposed surfaces are of one wood shall be designated by the name of the
wood.
II. Furniture in which the exposed surfaces are of more than one kind of wood shall be
designated by the names of the principal woods used.
INTERPRETATION OF RULES
1. Exposed surfaces mean those parts of a piece of furniture which are exposed to view when
the piece is placed in the generally accepted position for use.
2. The exposed surfaces of all furniture or parts thereof represented as solid shall be of solid
wood of the kind or kinds designated. If veneered on the same wood, it may be designated as
a wood of that particular kind. If veneered on a different wood, it shall be described as veneered
3. Cabinet woods, used for decorative purposes where the effect is solely to add to the artistic
value, shall be named as decorations only.
4. A wood popularly regarded as of lesser value, if its use is essential to construction, need
not be named under Rule II, if less than a substantial amount is used on exposed surfaces.
5. A wood popularly regarded as of higher value shall not be named under Rule II if an
insubstantial amount of that wood is used, except as provided in interpretation 3, above.
6. Designations shall be made in the caption or body of each particular description without
qualification elsewhere.
7. The word “Finish” to designate color shall only be used as a description following the name
of the wood used.
8. Where furniture is catalogued, tagged, labeled, advertised, or sold by retailers it shall be
in accordance with these rules and interpretations.

9. Where furniture is catalogued, tagged, labeled, advertised, invoiced. or sold by
manufacturers, manufacturers’ representatives, Jobbers, or wholesalers it shall be in accordance
with these rules and interpretations.
10. The above rules need not apply to antique furniture.
166

STATEMENTS OF TRADE PRACTICE CONFERENCES

167

We therefore request that these rules receive the official sanction and approval of the Federal
Trade Commission.
Gimbel Bros. (Inc.), by Sheldon R Coons; Buckley Newhall Co., by William Geng,
secretary; S.
Spear & Co., by Alexander Miller; Ludwig, Baumann & Co., by James B. McMahon,
jr.; John Wanamaker, N.Y., by Armin W. Riley; Bloomingdale Bros. (Inc.), by
Michael Joseph; Cowperthwait & Sons, by Walter C. Cowperthwait; W. & J. Sloane,
by Geo. H. Stevenson; R. Shellas & Chestnutt, (Inc.), by Walter L. Chestnutt, vice
president and treasurer; The Namm Store, by Joseph J. Lubrygt R. H. Macy & Co.
(Inc.), by Oswald W. Knauth; Stern Bros., by David W. Prendenthal; Lord & Taylor,
by J. S Scher; James A. Hearn & Son, by Truman P. Handy; James McCreery & Co.,
by E. L. Baker; Frederick Loeser & Co., by G. A. Helm; H. C. Koch & Co. (Inc.), by
W. T. Koch, treasurer; John A. Schwarz (Inc.), by John A. Schwarz, president;
McEney’s, by J. S. McEney; Abraham & Straus (Inc.), by John Mench; Deutsch Bros.,
by A. Deutsch; Weil Bros., by Morris Weil ; B. Altman & Co., by Charles Hayner,
secretary.
The commission announced that all furniture manufacturers of the country will be invited to
subscribe to the foregoing rules, and also that all furniture dealers and associations would
likewise be asked to subscribe.
CASTILE SOAP INDUSTRY
Announcement--May 12, 1926
The Federal Trade Commission to-day made the following statement: Pursuant to a petition
signed by 23 soap manufacturers, the commission, on March 30, 1926, held a trade practice
submittal with the industry for the purpose of considering the adoption of rules as to the
marketing, labeling, and advertising of soaps sold in the United States under the name “Castile.”
Notices of the meeting were sent to all manufacturers and importers of Castile soap. The
submittal was conducted by Commissioner C. W. Hunt. The following concerns were
represented:
Lever Bros. Co., Cambridge, Mass.
Armour & Co., Chicago, Ill.
Larkin & Co. (Inc.), Buffalo, N. Y.
Globe Soap Co., Cincinnati, Ohio.
Swift & Co., Chicago Ill.
Proctor & Gamble Co., Cincinnati, Ohio.
John T. Stanley Co. (Inc.), New York City.
Fels & Co., Philadelphia, Pa.
James S. Kirk Co., Chicago, Ill.
The Andrew Jergens Co., Cincinnati, Ohio.
The Cincinnati Soap Co., Cincinnati, Ohio.
Flash Chemical Co., Cambridge, Mass.
Chas. L. Huisking (Inc.), New York City.
Lockwood-Brackett Co., Boston, Mass.
H. R. Lathrop & Co. (Inc.), New York City.
Francisco Martin, New York City.
J. D. Nordlinger (Inc.), New York City.
After a complete discussion of the questions involved, the following resolution was adopted
by a majority of the manufacturers present:

“Be it resolved, That the following regulations be adopted pertaining to the marketing,
stamping, and labeling of Castile soaps:
“A. These regulations shall apply only to soaps stamped, labeled, or sold as Castile soaps.
“B. All such soaps shall be stamped on the cake or marked on the wrapper with the country
of their manufacture respectively
“C. All soaps, the stamping or labeling of which include the words Olive Oil Castile shall
contain no filler or adulteration and shall contain no fat or oil ingredient except olive oil.
“D. All soap stamped, labeled, or sold as ‘Castile,’ however that word may be qualified,
unless the qualifications include the word ‘olive’ or ‘cocoa,’

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ANNUAL REPORT OF THE FEDERAL TRADE COMMISSION

shall contain no filler or adulteration. If such soaps contain less than 51 per cent of olive oil or
no olive oil, it shall be so indicated on the cake or wrapper.
“E. All soaps, the stamping or labeling of which include the words, ‘Cocoa Hardware Castile’
or ‘Cocoa Castile,’ shall contain no filler or adulteration and the fat content thereof shall contain
not less than 51 per cent of the coconut oil.
“F. These regulations shall apply to castile’ soaps of foreign origin, handled and distributed
in the United States by importers and shall apply to all castile soaps manufactured in the United
States.”
After careful consideration of the above resolution, and the record presented at the
conference, the commission desires to make the following announcement :
“(1) That it can not approve the resolution adopted by a majority of the soap manufacturers
present at said submittal; and
“(2) That the term ‘Castile’ should be’ applied to pure olive oil soap; that is, soap made of
olive’ oil with no admixture of any other fat.”
Notice of the action of the commission is being given all soap manufacturers using the term
“Castile” in connection with the sale of their products. They are also being given an opportunity
to voluntarily discontinue marking, labeling, and advertising soap contrary to the action of the
commission.
MENDING-COTTON INDUSTRY
Announcement--October 31, 1925
In accordance with the desire expressed by a majority of the manufacturers of mending
cottons, a trade-practice submittal was held by Commissioner Huston Thompson, in New York
City, on June 23 and September 25, 1925, to consider the matter of the labeling or branding of
mending or darning cottons, with the view of eliminating those practices which might be
deemed unfair to competitors or misleading to the consumer, particularly with reference to the
marking of yardage, ends and plies. Invitations to the conference were issued to all
manufacturers in the industry of which the commission had knowledge. The following concerns
were represented:
Clark Thread Co., Newark, N. J.
Howard Manufacturing Co., Boston, Mass.
Dexter Yarn Co., Pawtucket, R. I.
Blodgett & Orwell Co., Pawtucket, R. I.
American Thread Co., New York, N. Y.
The Spool Cotton Co., New York, N. Y.
Amherst Manufacturing Co., Amherst, Mass.
D. E. Howard’s Son & Co., New York, N. Y.
J. & P. Coats (R. L) (Inc.); Pawtucket, R. I.
Collingbourne Mills (Inc.), Elgin, Ill.
These concerns constitute a large majority of the industry and are estimated to produce 90 per
cent of the darning cotton manufactured in the United States.
The action taken by the conference consisted in the unanimous adoption of the following
resolution, which was likewise unanimously agreed upon as specifying the proper method to be
followed by the industry in the branding or labeling of mending or darning cottons, and that any
other method of marking would be unfair to competitors and involve confusion or deceptions
of the consuming public:
“Resolved, That in the marketing, labeling, or branding of mending cotton the following and

no other, with reference to the yardage, ends, strands or ply shall be marked on the package or
ball and in the order stated :
“The yardage as it comes off the ball or package.
“The number of ends.
“The number of plies per end.”
The commission, as a result of this submittal, desires to announce to the trade and public that
it receives the action taken by the industry as set fourth above and approves the method of
branding or labeling of mending cottons as prescribed in foregoing resolution.
The commission further announced that the industry shall have until February 1, 1926, to meet
the requirements for marking their product as set forth

STATEMENTS OF TRADE PRACTICE CONFERENCES

169

in the statement given out by the commission. The commission will thereafter entertain
complaints against members who have failed to conform to the terms of the resolution adopted
by the industry and approved by the commission.
“RAYON”
Announcement --October 31, 1925
The Federal Trade Commission by an official resolution has placed the stamp of its approval
on the use of the word “Rayon” as properly designating artificial-silk products the basis and
chief ingredient of which is cellulose.
There have been before the commission a number of cases involving the misbranding of
textiles which have artificially been given the appearance of silk, and have been sold under trade
names containing the word “silk” or a modification of the word “silk.” In deciding these cases
the commission has consistently held that hosiery or other products which simulate silk but are
not the product of the cocoon of the silkworm should be branded with the words “Artificial silk”
or other words which correctly describe the materials composing the article branded.
The word “Rayon” has been adopted by m any associations of manufacturers as a proper one
for artificial-silk products and the term has been extensively advertised to the public. The
commission, therefore, believing that both the trade and the public have come to accept and
recognize the word “Rayon” as being applied to artificial silk or a substitute for silk, passed a
formal resolution in which the term “Rayon” is accepted as a proper designation for artificialsilk products. The complete resolution follows :
“Whereas a material has been developed, the basis of which is cellulose, which is extensively
used in many trades and industries as a substitute for silk, to which material the term ‘Rayon’
has been applied ; and
“Whereas the said term ‘Rayon’ has been adopted by many different associations of
manufacturers as the official and proper designation for artificial silk; and
“Whereas the Federal Trade Commission in many decisions has consistently held that hosiery
or other products made of materials which simulate silk but are not the product of the cocoon
of the silkworm should be branded with the words ‘Artificial silk’ or other words which
correctly describe the materials composing the article branded ; and
“Whereas the term ‘Rayon’ has been adopted by the trade, and is generally accepted and
recognized by the trade and public to mean and indicate artificial silk, or a substitute for silk :
“Be it resolved, That the Federal Trade Commission hereby recognizes the term ‘Rayon’ as
meaning and properly designating the artificial-silk products, the basis and chief ingredient of
which is cellulose.”