That the methods of competition set forth in the foregoing findings as to the facts, and each and all thereof, under the circumstances therein set forth, constitute unfair methods of competition in commerce in the District of Columbia, in violation of the provisions of Section 5 of the Federal Trade Commission Act, approved September 26, 1914, entitled "An Act to create a Federal Trade Commission, to define its powers and duties, and for other purposes."

ORDER TO CEASE AND DESIST.

This proceeding having been heard by the Federal Trade Commission upon the pleadings and the testimony and evidence received by an examiner duly appointed by the Commission, and the arguments of counsel for the respondent and for the Commission, and the Commission having made its findings as to the facts and its conclusion that the respondent has violated the provisions of an Act of Congress approved September 26, 1914, entitled, "An Act to create a Federal Trade Commission, to define its powers and duties, and for other purposes," which said report is hereby referred to and made a part hereof; Now, therefore

It is ordered, That the respondent, Alfred Klesner, his servants, agents and employees cease and desist 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.

It is further ordered, That the respondent, Alfred Klesner, within thirty days from the date of service of this order upon him file with the Commission a report, setting forth in detail the manner and form in which he has complied with the order of the Commission herein set forth.

Complaint.

FEDERAL TRADE COMMISSION

v.

THE HENKEL-CLAUSS COMPANY.

COMPLAINT IN THE MATTER OF THE ALLEGED VIOLATION OF SECTION 5 OF AN ACT OF CONGRESS APPROVED SEPTEMBER 26, 1914.

SYLLABUS.

Docket 802-June 23, 1922.

Where razors of high quality had long been made in Sheffield, England, and the word "Sheffield" when applied to cutlery had come to mean to the trade and purchasing public cutlery of good quality there made; and thereafter a corporation engaged in the manufacture and sale of razors at Fremont, Ohio, with a capacity to mislead and deceive the purchasing public,

(a) Sold razors of domestic manufacture stamped

"Sheffield" without any

other marks to show the true place or origin; (b) Sold razors, for which it charged from $4 to $5 per dozen, packed in individual containers bearing the legend, “Price $3.00 Special Quality, Fully Warranted," the fact being that said razors were neither of special quality nor fully warranted, and that said marked price was a fictitious and misleading price greatly in excess of the usual retail price of such razors: Held, That such misbranding, and such misrepresentation of price, under the circumstances set forth, constituted unfair methods of competition.

COMPLAINT.

The Federal Trade Commission, having reason to believe from a preliminary investigation made by it that The Henkel-Clauss Company, hereinafter referred to as the respondent, has been and is using unfair methods of competition in violation of the provisions of Section 5 of an Act of Congress approved September 26, 1914, entitled "An Act to create a Federal Trade Commission, to define its powers and duties, and for other purposes," and it appearing that a proceeding by it in respect thereof would be to the interest of the public, issues this complaint, stating its charges in that respect on information and belief, as follows:

PARAGRAPH 1. That the respondent is a corporation organized and existing under the laws of the State of Ohio, with its principal place of business at Fremont, in said State.

PAR. 2. That respondent is engaged in the business of manufacturing and selling cutlery, including razors, and causes commodities sold by it to be transported to the purchaser thereof from the State of Ohio through and into other States of the United States, and carries on such business in direct, active competition with other persons, partnerships and corporations similarly engaged.

PAR. 3. That respondent, in the course of its business as described in Paragraph 2 hereof, sells to jobbers and retailers at prices ranging from $4.00 to $5.00 per dozen, razors which are defective or otherwise unsuitable for the market, packed singly in cases, which said cases bear labels on which are printed a false and fictitious proposed resale price, to-wit, $3.00, and the words "Special Quality, Fully Warranted," which said words also are false; that said false and fictitious price, and said false words are calculated to and do mislead and deceive the purchasing public into the belief that a highgrade razor is contained in said case, notwithstanding said razors are sold to the public at a much lower price than $3.00.

PAR. 4. That respondent further, in the course of its said business, manufactures and sells razors which are defective or otherwise unsuitable for the market, upon which is imprinted the word "Sheffield," without any marks to show the true place of origin of said razors; that razors of high quality have been manufactured in large quantities in Sheffield, England, for a long period of time, and the word "Sheffield," when used in connection with cutlery, has come to be understood by the trade and the purchasing public as indicating that such cutlery was made in Sheffield, England, and is of good quality; that the use by the respondent of the word "Sheffield," as aforesaid, on razors of inferior quality made in the United States by respondent, which razors are defective and unsuitable for the market, is calculated to, and does, mislead and deceive the purchasing public, and is so used by respondent to enable the dealers selling such razors at retail to pass off an inferior grade of razors as and for razors of good quality made in Sheffield, England.

PAR. 5. That by reason of the facts recited, the respondent is using an unfair method of competition in commerce within the intent and meaning of Section 5 of an Act of Congress entitled "An Act to create a Federal Trade Commission, to define its powers and duties, and for other purposes," approved September 26, 1914.

REPORT, FINDINGS AS TO THE FACTS, AND ORDER. Pursuant to the provisions of an Act of Congress approved September 26, 1914, the Federal Trade Commission issued and served a complaint upon the respondent, The Henkel-Clauss Company, charging it with unfair methods of competition in commerce in violation of the provisions of said Act.

The respondent, The Henkel-Clauss Company, having entered its appearance by its attorneys, Culbert & Culbert, and filed its answer herein, denying certain allegations of the complaint and admitting others, and having made and filed herein a stipulation as to the

facts wherein it is agreed that the Commission may take the statement of facts contained in such stipulation, as the relevant, material facts of this proceeding, and proceed further upon the complaint, answer and stipulation, to make its report, stating its findings as to the facts and its conclusion, and enter its order disposing of the proceeding; the right to file briefs or make oral argument being waived,

Thereupon this proceeding came on for final hearing, and the Commission, having considered the complaint, the answer thereto and the stipulation as to the facts, and being fully advised in the premises, makes this its findings as to the facts and conclusion:

FINDINGS AS TO THE FACTS.

PARAGRAPH 1. That the respondent, The Henkel-Clauss Company, is a corporation organized under the laws of the State of Ohio, with its principal place of business at Fremont, in said State; that respondent was originally incorporated in 1906 as the Henkel Company, and in 1919, by amendment of its charter, its name was changed to The Henkel-Clauss Company.

PAR. 2. That the respondent at all times since its organization has been engaged in the business of manufacturing and selling shears, manicure sets, razors, and other articles, causing same to be transported to the purchasers thereof, from the State of Ohio, through and into other States of the United States and to foreign countries, in due course of commerce among the several States and foreign nations.

PAR. 3. That on or about May 1, 1919, respondent purchased and took over all of the assets and property of the Clauss Shears Company, a corporation with principal place of business at Fremont, Ohio, which corporation had theretofore been manufacturing and selling cutlery of various kinds, including razors; that among the property so purchased by respondent and thereafter resold by it, was a small quantity of razors upon which were imprinted the words "Sheffield" without any other marks to show the true place of origin of same, and which razors respondent assumed and believed had been manufactured in Sheffield, England, and imported by said Clauss Shears Company, but which razors were of domestic manufacture.

PAR. 4. That razors of high quality have been manufactured in Sheffield, England, in large quantities for a long period of time and the word "Sheffield," when used in connection with cutlery, has come to be understood by the trade and purchasing public in the United States, as indicating that such cutlery was made in Sheffield, England, and is of good quality, and the sale of cutlery

made in America upon which the word "Sheffield" is imprinted has the capacity or tendency to mislead and deceive the purchasing public..

PAR. 5. That further among the property purchased from the Clauss Shears Company, as set forth in Paragraph 3 hereof, were razors of various grades and patterns and razor blades upon which respondent thereafter fitted handles; that some of said razors, when so purchased, were packed singly in cases upon which were printed "Price, $3.00. Special Quality, Fully Warranted," and the remainder of such razors were packed by respondent in cases which were also acquired from said Clauss Shears Company, upon which cases were also printed "Price $3.00, Special Quality, Fully Warranted"; that such razors were in odd lots, some being of good quality and others seconds or defective and unsuitable for the general trade; that such razors were not listed for sale by respondent in its catalog, but were closed out in job lots at special prices ranging from $4.00 to $5.00 per dozen, some of which razors were sold and transported to dealers in New York, N. Y.; that such razors, packed as aforesaid, were all disposed of by respondent about one year prior to the issuance of the complaint herein, and since said time no sales under similar circumstances have been made by respondent.

PAR. 6. That the razors sold by respondent, as set out in Paragraph 5 hereof, were not of special quality and were not fully warranted, and the price noted on the containers thereof was fictitious and misleading and greatly in excess of the fair market value of such razors in the regular course of retail trade, and the printed. matter on the containers of such razors had the capacity or tendency to mislead and deceive the purchasing public as to the quality or value of such razors.

CONCLUSION.

That the practices of the said respondent, under the conditions and circumstances described in the foregoing findings, are unfair methods. of competition in commerce among the States and with foreign nations, and constitute a violation of Section 5 of the Act of Congress approved September 26, 1914, entitled, "An Act to create a Federal Trade Commission, to define its powers and duties, and for other purposes."

ORDER TO CEASE AND DESIST.

This proceeding having been heard by the Federal Trade Commission upon the complaint of the Commission, the answer of the respondent, and a stipulation as to the facts, and the Commission having made its findings as to the facts, with its conclusion, that