USDrives Corporation; Analysis To Aid Public Comment

FEDERAL TRADE COMMISSION

[File No. 9823587]

USDrives Corporation; Analysis To Aid Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed consent agreement.

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SUMMARY: The consent agreement in this matter settles alleged

violations of federal law prohibiting unfair or deceptive acts or

practices or unfair methods of competition. The attached Analysis to

Aid Public Comment describes both the allegations in the draft

complaint that accompanies the consent agreement and the terms of the

consent order--embodied in the consent agreement--that would settle

these allegations.

DATES: Comments must be received on or before March 29, 1999.

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

Room 159, 600 Pa. Ave., NW, Washington, DC 20580.

FOR FURTHER INFORMATION CONTACT:

Elaine Kolish or Laura Koss, FTC/S-4302, 601 Pa. Ave., NW, Washington,

DC 20580, (202) 326-3042 or 326-2890.

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 above-captioned 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. The following Analysis to Aid

Public Comment describes the terms of the consent agreement, and the

allegations in the complaint. An electronic copy of the full text of

the consent agreement package can be obtained from the FTC Home Page

(for January 19, 1999), on the World Wide Web, at ``http://www.ftc.gov/

os/actions97.htm.'' A paper copy can be obtained from the FTC Public

Reference Room, Room H-130, 600 Pennsylvania Avenue, NW, Washington, DC

20580, either in person or by calling (202) 326-3627. 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)).

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 from respondent USDrives

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

[[Page 3952]]

and will decide whether it should withdraw from the agreement and take

other appropriate action or make final the agreement's proposed order.

This matter concerns advertising, packaging, labeling and

promotional practices related to the sale of optical drives that read

information on compact disc read-only memory discs (``CD-ROM drives'').

The Commission's complaint charges that respondent misrepresented that

its CD-ROM drives were all or virtually all made in the United States

when, in truth and in fact, its CD-ROM drives were assembled in the

United States of primarily imported parts. In addition, the complaint

charges that respondent misrepresented that CD-ROM drives that were

made in China of primarily non-U.S. parts were all or virtually all

made in the United States.

The proposed consent order contains a provision that is designed to

remedy the charges and to prevent the respondent from engaging in

similar acts and practices in the future. Part I of the proposed order

prohibits the respondent from misrepresenting the extent to which any

CD-ROM drive is made in the United States. The proposed order would

allow respondent to represent that a CD-ROM drive is made in the United

States so long as all, or virtually all, of the component parts of the

CD-ROM drive are made in the United States and all, or virtually all,

of the labor in manufacturing the CD-ROM drive is performed in the

United States.

Part II of the proposed order requires the respondent to maintain

materials relied upon in disseminating any representation covered by

the order. Part III of the proposed order requires the respondent to

distribute copies of the order to certain company officials and

employees. Part IV of the proposed order requires the respondent to

notify the Commission of any change in the corporation that may affect

compliance obligations under the order. Part V of the proposed order

requires the respondent to file one or more compliance reports. Part VI

of the proposed order is a provision whereby the order, absent certain

circumstances, terminates twenty years from the date of issuance.

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

proposed consent order. It is not intended to constitute an official

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

way their terms.

By direction of the Commission.

Donald S. Clark,

Secretary.

[FR Doc. 99-1660 Filed 1-25-99; 8:45 am]

BILLING CODE 6750-01-M