Notations, Inc., et al.; Proposed Consent Agreement With Analysis To Aid Public Comment

FEDERAL TRADE COMMISSION

[File No. 932 3163]

Notations, Inc., et al.; Proposed Consent Agreement With Analysis

To Aid Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed Consent Agreement.

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SUMMARY: In settlement of alleged violations of federal law prohibiting

unfair acts and practices and unfair methods of competition, this

consent agreement, accepted subject to final Commission approval, would

prohibit, among other things, a Pennsylvania company and its president

from misbranding any textile product by mentioning or implying that the

product contains a fiber without using the generic fiber name required

by the Textile Fiber Products Identification Act and the Federal Trade

Commission rules, or by mentioning or implying that it contains a fiber

when it, in fact, does not. The respondents also would be required to

file with the Commission a continuing guaranty applicable to all

textile products they handle in the future.

DATES: Comments must be received on or before December 30, 1994.

ADDRESSES: Comments should be directed to: FTC/Office of the Secretary,

Room 159, 6th St. and Pa. Ave., N.W., Washington, D.C. 20580.

FOR FURTHER INFORMATION CONTACT:

Katharine Alphin, Atlanta Regional Office, 1718 Peachtree St., N.W.,

Room 1000, Atlanta, GA. 30367. (404) 347-4837.

SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal

Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46 and Section 2.34 of

the Commission's Rules of Practice (16 CFR 2.34), notice is hereby

given that the following consent agreement containing a consent order

to cease and desist, having been filed with and accepted, subject to

final approval, by the Commission, has been placed on the public record

for a period of sixty (60) days. Public comment is invited. Such

comments or views will be considered by the Commission and will be

available for inspection and copying at its principal office in

accordance with Section 4.9(b)(6)(ii) of the Commission's Rules of

Practice (16 CFR 4.9(b)(6)(ii)).

In the Matter of: Notations, Inc., a corporation, and Kurt

Erman, individually and as an officer of said corporation; File No.

932 3163. Agreement containing consent order to cease and desist.

The Federal Trade Commission having initiated an investigation of

certain acts and practices of Notations, Inc., a corporation and Kurt

Erman, individually and as an officer of said corporation, and it now

appearing that Notations, Inc., a corporation, and Kurt Erman,

individually and as an officer of said corporation, hereinafter

sometimes referred to as proposed respondents, are willing to enter

into an agreement containing an order to cease and desist from the use

of the acts and practices being investigated.

It is hereby agreed by and between Notations, Inc., by its duly

authorized officer, and Kurt Erman, individually and as an officer of

said corporation, and their attorney, and counsel for the Federal Trade

Commission that:

1. Proposed respondent Notations, Inc., is a corporation organized,

existing and doing business under and by virtue of the laws of the

Commonwealth of Pennsylvania, with its office and principal place of

business located at 109 Pike Circle, Huntingdon Valley, Pennsylvania

19062.

2. Proposed respondent Kurt Erman is the sole shareholder and

president of Notations, Inc. He formulates, directs and controls the

policies, acts and practices of said corporation and his office and

principal place of business are the same as Notations, Inc.

3. Proposed respondents admit all the jurisdictional facts set

forth in the draft of complaint here attached.

4. Proposed respondents waive:

(a) Any further procedural steps;

(b) The requirement that the Commission's decision contain a

statement of findings of fact and conclusions of law;

(c) All rights to seek judicial review or otherwise to challenge or

contest the validity of the order entered pursuant to this agreement;

and

(d) Any claim under the Equal Access to Justice Act.

5. This agreement shall not become part of the public record of the

proceeding unless and until it is accepted by the Commission. If this

agreement is accepted by the Commission it, together with the draft of

complaint contemplated thereby, will be placed on the public record for

a period of sixty (60) days and information in respect thereto publicly

released. The Commission thereafter may either withdraw its acceptance

of this agreement and so notify the proposed respondents, in which

event it will take such action as it may consider appropriate, or issue

and serve its complaint (in such form as the circumstances may require)

and decision, in disposition of the proceeding.

6. This agreement is for settlement purposes only and does not

constitute an admission by proposed respondents of facts, other than

jurisdictional facts, or of violations of law an alleged in the draft

of complaint here attached.

7. This agreement contemplates that, if it is accepted by the

Commission, and if such acceptance is not subsequently withdrawn by the

Commission pursuant to the provisions of Sec. 2.34 of the Commission's

Rules, the Commission may, without further notice to proposed

respondents, (1) issue its complaint corresponding in form and

substance with the draft of complaint here attached and its decision

containing the following order to cease and desist in disposition of

the proceeding and (2) make information public in respect thereto. When

so entered, the order to cease and desist shall have the same force and

effect and may be altered, modified or set aside in the same manner and

within the same time provided by statute for other orders. The order

shall become final upon service. Delivery by the U.S. Postal Service of

the complaint and decision containing the agreed-to order to proposed

respondents' address as stated in this agreement shall constitute

service. Proposed respondents waive any right they may have to any

other manner of service. The complaint may be used in construing the

terms of the order, and no agreement, understanding, representation, or

interpretation not contained in the order or the agreement may be used

to vary or contradict the terms of the order.

8. Proposed respondents have read the proposed complaint and order

contemplated hereby. They understand that once the order has been

issued, they will be required to file one or more compliance reports

showing that they have fully complied with the order. Proposed

respondents further understand that they may be liable for civil

penalties in the amount provided by law for each violation of the order

after it becomes final.

Order

I

It is ordered that respondents Notations, Inc., a corporation, its

successors and assigns, and its officers, and Kurt Erman, individually

and an officer of said corporation, and respondents' representatives,

agents and employees, directly or through any corporation, subsidiary,

division or any other device, in connection with the introduction,

delivery for introduction, manufacture for introduction, sale,

advertising, or offering for sale, in commerce, or the transportation

or causing to be transported in commerce, or the importation into the

United States of any textile fiber product, as ``commerce'' and

``textile fiber product'' are defined in the Textile Fiber Products

Identification Act, 15 U.S.C. 70, hereinafter ``Textile Fiber Act,''

and the Rules and Regulations Under the Textile Fiber Products

Identification Act, 16 U.S.C. Sec. 303, hereinafter ``Rule(s),'' do

forthwith cease and desist from misbranding or falsely or deceptively

advertising any such product by:

A. Mentioning or implying fiber content without using the generic

fiber names in a manner consistent with the Textile Fiber Act and the

Rules thereunder; and

B. Mentioning or implying fiber content for a fiber that is not

present in such textile fiber product.

II

It is further ordered that respondents shall forthwith file with

the Commission a continuing guaranty applicable to all textile products

handled by respondents, in the form prescribed by Rule 38, 16 CFR

Sec. 303.38.

III

It is further ordered that respondent Notations, Inc., shall:

A. For a period of five (5) years after the service of this order,

keep copies of each stamp, tag, label or other form of identification

that shows information required by the Textile Fiber Act as well as

such records as will show the textile fiber products in which each

stamp, tag, label or other form of identification was affixed for each

product it introduces, manufactures for introduction, sells,

advertises, offers for sale or imports; and

B. For a period of five (5) years after the service of this order,

maintain and upon request make available to the Federal Trade

Commission for inspection and copying, the documents in Paragraph

III.A. above and such other documents and materials as shall

demonstrate full compliance with this order.

IV

It is further ordered that respondent, Notations, Inc., shall

within thirty (30) days after the date of service of this order,

provide a copy of this order to each of its current directors and

officers, and to each employee, agent and representative having

managerial, purchasing, importing, sales, advertising, or policy

responsibility with respect to the subject matter of this order.

V

It is further ordered that respondent, Notations, Inc., shall, in

writing, notify the Federal Trade Commission at least thirty (30) days

prior to any proposed change in the respondent such as dissolution,

assignment or sale resulting in the emergence of a successor

corporation, the creation or dissolution of subsidiaries or any other

such change in the corporation that may affect compliance obligations

arising out of the order.

VI

It is further ordered that, for a period of five (5) years from the

date of service of this order, respondent Kurt Erman, shall, in

writing, notify the Federal Trade Commission within thirty (30) days of

the discontinuance of his present business or employment and of his

affiliation with a new business or employment, each such notice to

include the respondent's new business address and a statement of the

nature of the business or employment in which the respondent is newly

engaged as well as a description of respondent's duties and

responsibilities in connection with the business or employment.

VII

It is further ordered that respondents shall, within sixty (60)

days after the date of service of this order, submit a verified report

in writing, to the Federal Trade Commission setting forth in detail the

manner and form in which they have complied with this order.

Analysis of Proposed Consent Order To Aid Public Comment

The Federal Trade Commission has accepted an agreement to a

proposed consent order from respondents Notations, Inc., and Kurt

Erman, individually and as an officer of the corporation.

The proposed consent order has been placed on the public record for

sixty (60) days for reception of comments by interested persons.

Comments received during this period will become part of the public

record. After sixty (60) days, the Commission will again review the

agreement and the comments received and will decide whether it should

withdraw from the agreement or make final the agreement's proposed

order.

The complaint alleges that respondents misbranded certain textile

fiber products by using the trade name Micro Silk, thereby implying

that silk, a fiber not present in the products, was present. These acts

and practices are in violation of the Textile Fiber Products

Identification Act, 15 U.S.C. 70; the Commission's Rules and

Regulations Under the Textile Fiber Products Identification Act, 16 CFR

303; and Section 5 of the Federal Trade Commission Act, 15 U.S.C.

Sec. 45.

The proposed order requires that the company cease and desist (1)

Mentioning or implying fiber content without using the generic fiber

names in a manner consistent with the Act and Rules, and (2) mentioning

or implying fiber content for a fiber that is not present in a textile

fiber product.

The purpose of this analysis is to facilitate public comment on the

proposed order, and it is not intended to constitute an official

interpretation of the agreement and proposed order or to modify in any

way their terms.

Donald S. Clark,

Secretary.

[FR Doc. 94-26938 Filed 10-28-94; 8:45 am]

BILLING CODE 6750-01-M