BBDO Worldwide, Inc.; Consent Agreement with Analysis To Aid Public Comment

FEDERAL TRADE COMMISSION

[File No. 942-3172]

BBDO Worldwide, Inc.; Consent Agreement with Analysis To Aid

Public Comment

AGENCY: Federal Trade Commission.

ACTION: 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, among other things, prohibit a New York City-based advertising

firm from misrepresenting the amount of fat, calories, or cholesterol

in any frozen yogurt, any frozen sorbet, and most ice cream products.

The alleged violations stem from the firm's role in developing certain

advertisements for Haagen-Dazs frozen yogurt products.

DATES: Comments must be received before December 26, 1995.

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

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

FOR FURTHER INFORMATION CONTACT:

Anne V. Maher, Bureau of Consumer Protection, Federal Trade Commission,

S-4002, 6th Street & Pennsylvania Ave., NW., Washington, DC 205680.

(202) 326-2987).

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 of 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)).

The Federal Trade Commission, having initiated an investigation of

certain acts and practices of BBDO Worldwide, Inc., a corporation,

hereinafter sometimes referred to as proposed respondent, and it now

appears that proposed respondent is 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 BBDO Worldwide, Inc., by its

duly authorized officer, and its attorney, and counsel for the Federal

Trade Commission that:

1. Proposed respondent BBDO Worldwide, Inc. is a corporation

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

of the State of New York, with its office and principal place of

business located at 1285 Avenue of the Americas, New York, NY 10019.

2. Proposed respondent admits all the jurisdictional facts set

forth in the draft compliant attached hereto.

3. Proposed respondent waives:

(a) Any further procedural steps;

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

statement of findings of fact and conclusions of law; and

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

contest the validity of the Order entered pursuant to this agreement.

4. 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 respondent, in which event

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

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

decision, in disposition of the proceeding.

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

constitute an admission by proposed respondent that the law has been

violated as alleged in the draft of complaint here attached, or that

the facts as alleged in the draft complaint, other than jurisdictional

facts, are true.

6. The 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 Section 2.34 of the

Commission's Rules, the Commission may, without further notice to

proposed respondent, (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 respondent's address as stated in this agreement shall

constitute service. Proposed respondent waives any rights it 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 in the

agreement may be used to vary or contradict the terms of the Order.

7. Proposed respondent has read the proposed complaint and Order

contemplated hereby. Proposed respondent understands that once the

Order has been issued, it will be required to file one or more

compliance reports showing that it has fully complied with the Order.

Proposed respondent further understands that it 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 respondent BBDO Worldwide, Inc., a corporation,

its successors and assigns, and its officers, agents, representatives

and employees, directly or through any corporation, subsidiary,

division or other device, in connection with the manufacturing,

labeling, advertising, promotion, offering for sale, sale, or

distribution of any frozen yogurt, frozen sorbet or ice cream product

(excluding all other food or confection products in which ice cream is

an ingredient comprising less than fifty percent of the total weight of

the involved product) in or affecting commerce, as ``commerce'' is

defined in the Federal Trade Commission Act, do forthwith cease and

desist from misrepresenting, in any manner, directly or by implication,

through numerical or descriptive terms or any other means, the

existence or amount of fat, saturated fat, cholesterol or calories in

any such product. If any

[[Page 55032]]

representation covered by this Part either directly or by implication

conveys any nutrient content claim defined (for purposes of labeling)

by any regulation promulgated by the Food and Drug Administration,

compliance with this Part shall be governed by the qualifying amount

for such defined claim as set forth in that regulation.

II

Nothing in this Order shall prohibit respondent from making any

representation that is specifically permitted in labeling for any

frozen yogurt, frozen sorbet or ice cream by regulations promulgated by

the Food and Drug Administration pursuant to the Nutrition Labeling and

Education Act of 1990.

III

It is further ordered that for three (3) years after the last date

of dissemination of any representation covered by this Order,

respondent, or its successors and assigns, shall maintain and upon

request make available to the Federal Trade Commission for inspection

and copying:

1. All materials that were relied upon in disseminating such

representation; and

2. All tests, reports, studies, surveys, demonstrations, or other

evidence in its possession or control that contradict, qualify, or call

into question such representation, or the basis relied upon for such

representation, including complaints from consumers.

IV

It is further ordered that respondent shall notify the 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 change in the respondent which may affect

compliance obligations arising out of this Order.

V

It is further ordered that respondent shall, within thirty (30)

days after service of this Order, distribute a copy of this Order to

each of its operating divisions and to each of its officers, agents,

representatives, or employees engaged in the preparation or placement

of advertisements or other materials covered by this Order.

VI

This Order will terminate twenty (20) years from the date of its

issuance, or twenty years from the most recent date that the United

States or the Federal Trade Commission files a complaint (with or

without an accompanying consent decree) in federal court alleging any

violation of the Order, whichever comes later; provided, however, that

the filing of such a complaint will not effect the duration of:

A. Any paragraph in this Order that terminates in less than twenty

years;

B. This Order's application to any respondent that is not named as

a defendant in such complaint; and

C. This Order if such complaint is filed after the Order has

terminated pursuant to this paragraph.

Provided further, that if such complaint is dismissed or a federal

court rules that the respondent did not violate any provision of the

Order, and the dismissal or ruling is either not appealed or upheld on

appeal, then the Order will terminate according to this paragraph as

though the complaint was never filed, except that the Order will not

terminate between the date such complaint is filed and the later of the

deadline for appealing such dismissal or ruling and the date such

dismissal or ruling is upheld on appeal.

VII

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

after service of this Order, and at such other times as the Commission

may require, file with the Commission a report, in writing, setting

forth in detail the manner and form in which it has complied with this

Order.

Analysis of Proposed Consent Order To Aid Public Comment

The Federal Trade Commission has accepted an agreement, subject to

final approval, to a proposed consent order form BBDO Worldwide, Inc.

(``BBDO'').

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 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.

This matter concerns advertising claims made by BBDO, an

advertising agency, for Haagen-Dazs frozen yogurts. A separate consent

agreement with Haagen-Dazs relating to the same advertisements was

given final approval by the Commission on June 2, 1995.

The Commission's complaint in this matter charges BBDO with

engaging in unfair or deceptive practices in connection with the

advertising of Haagen-Dazs frozen yogurt products, which are sold in

both carton and bar forms.

According to the complaint, BBDO falsely represented that the

frozen yogurt is 98 percent fat free and low fat. The complaint also

alleges that BBDO falsely represented that the frozen yogurt bars

contain one gram of fat per serving and are low fat.

The complaint further alleges that BBDO falsely represented that

the frozen yogurt bars contain 100 calories per serving. Finally, the

complaint alleges that BBDO knew or should have know that these claims

were false and misleading.

The consent order contains provisions designed to remedy the

violations charged and to prevent BBDO from engaging in similar

deceptive and unfair acts and practices in the future.

Part I of the order prohibits BBDO from misrepresenting the

existence or amount of fat, saturated fat, cholesterol or calories in

any frozen yogurt, frozen sorbet or ice cream product (excluding all

other food or confection products in which ice cream is an ingredient

comprising less than fifty percent of the total weight of the involved

product). Part I also requires that any representation covered by the

Part that conveys a nutrient content claim defined for labeling by any

regulation of the Food and Drug Administration (``FDA'') must comply

with the qualifying amount set forth in that regulation.

Part II of the order provides that representations that would be

specifically permitted in food labeling, under regulations issued by

the FDA pursuant to the Nutrition Labeling and Education Act of 1990,

are not prohibited by the order.

Part III of the order requires BBDO to maintain copies of all

materials relied upon in making any representation covered by the

order.

Part IV of the order requires BBDO to notify the Commission of any

changes in corporate structure that might affect compliance with the

order.

Part V of the order requires BBDO to distribute copies of the order

to its operating divisions and to various officers, agents and

representatives of BBDO.

Part VI of the order is a ``sunset'' provision, dictating that the

order will terminate twenty years from the date it is issued or twenty

years after a complaint is filed in federal court, by either the United

States or the FTC, alleging any violation of the order.

Part VII of the order requires BBDO to file with the Commission one

or more

[[Page 55033]]

reports detailing compliance with the order.

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 any of

their terms.

Donald S. Clark,

Secretary.

[FR Doc. 95-26680 Filed 10-26-95; 8:45 am]

BILLING CODE 6750-01-M