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ers or prospective customers, without the knowledge of their employers or principals, as an inducement to influence their employers or principals to purchase or contract to purchase products manufactured or sold by such industry member or the maker of such gift or offer, or to influence such employers or principals to refrain from dealing in the products of competitors or from dealing or contracting to deal with competitors. [Rule 13]

§ 168.14 Defamation of competitors or disparagement of their products. The defamation of competitors by falsely imputing to them dishonorable conduct, inability to perform contracts, questionable credit standing, or by other false representations, or the false disparagement of the products of competitors in any respect, or of their business methods, selling prices, values, credit terms, policies, or services, is an unfair trade practice. [Rule 14]

§ 168.15 Inducing breach of contract. Inducing or attempting to induce the breach of existing lawful contracts between competitors and their customers or their contracts between competitors and their customers or their suppliers by any false or deceptive means whatsoever, or interfering with or obstructing the performance of any such contractual duties or services by any such means, with the purpose and effect of unduly hampering, injuring, or prejudicing competitors in their business, is an unfair trade practice. [Rule 15]

§ 168.16 Unfair threats of infringement suits. The circulation of threats of suit for infringement of patents or trademarks among customers or prospective customers of competitors, not made in good faith but for the purpose or with the effect of thereby harassing or intimidating such customers or prospective customers, or of unduly hampering, injuring, or prejudicing competitors in their business, is an unfair trade practice. [Rule 16]

§ 168.17 Selling below cost. The practice of selling industry products below the seller's cost with the intent and with the effect of injuring a competitor and where the effect may be substantially to lessen competition or tend to create a monopoly or unreasonably restrain trade is an unfair trade practice. All elements recognized by good accounting practice as proper elements of such cost shall be

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included in determining cost under this section. The costs, however, which are referred to in this section are actual costs of the respective seller and not some other figure or average costs in the industry determined by an industry cost survey or otherwise. [Rule 17]

§ 168.18 Combination or coercion to fix prices, suppress competition, or restrain trade. It is an unfair trade practice for a member of the industry, or any other person:

(a) To use, directly or indirectly, any form of threat, intimidation, or coercion against any member of the industry or other person to unlawfully fix, maintain, or enhance prices, suppress competition, or restrain trade; or

(b) To enter into or take part in, directly or indirectly, any agreement, understanding, combination, conspiracy, or concerted action with one or more members of the industry, or with one or more other persons, to unlawfully fix, maintain, or enhance prices, suppress competition, or restrain trade. [Rule 18]

§ 168.19 Discrimination—(a) Prohibited discriminatory prices, or rebates, refunds, discounts, credits, etc., which effect unlawful price discrimination. It is an unfair trade practice for any member of the industry engaged in commerce,1 in the course of such commerce, to grant or allow, secretly or openly, directly or indirectly, any rebate, refund, discount, credit, or other form of price differential (whether in the guise of samples or otherwise), where such rebate, refund, discount, credit, or other form of price differential, effects a discrimination in price between different purchasers of goods of like grade and quality, where either or any of the purchases involved therein are in commerce,' and where the effect there

1 As here used, the word "commerce" 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. (With respect to the Philippine Islands, the foregoing is subject to such statutory limitations as relate thereto.)

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of may be substantially to lessen competition or tend to create a monopoly in any line of commerce', or to injure, destroy, or prevent competition with any person who either grants or knowingly receives the benefit of such discrimination, or with customers of either of them: Provided, however:

(1) That the goods involved in any such transaction are sold for use, consumption, or resale within any place under the jurisdiction of the United States;

(2) That nothing herein contained shall prevent differentials which make only due allowance for differences in the cost of manufacture, sale, or delivery resulting from the differing methods or quantities in which such commodities are to such purchasers sold or delivered;

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(3) That nothing herein contained shall prevent persons engaged in selling goods, wares, or merchandise in commerce1 from selecting their own customers in bona fide transactions and not in restraint of trade;

(4) That nothing herein contained shall prevent price changes from time to time where made in response to changing conditions affecting either (i) the market for the goods concerned, or (ii) the marketability of the goods, such as, but not limited to, actual or imminent deterioration of perishable goods, obsolescence of seasonal goods, distress sales under court process, or sales in good faith in discontinuance of business in the goods concerned.

(b) Prohibited brokerage and commissions. It is an unfair trade practice for any member of the industry engaged in commerce,' in the course of such commerce, to pay or grant, or to receive or accept, anything of value as a commis

1 As here used, the word "commerce" 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. (With respect to the Philippine Islands, the foregoing is subject to such statutory limitations as relate thereto.)

sion, brokerage, or other compensation, or any allowance or discount in lieu thereof, except for services rendered in connection with the sale or purchase of goods, wares, or merchandise, either to the other party to such transaction or to an agent, representative, or other intermediary therein where such intermediary is acting in fact for or in behalf, or is subject to the direct or indirect control, of any party to such transaction other than the person by whom such compensation is so granted or paid.

(c) Prohibited advertising or promotional allowances, etc. It is an unfair trade practice for any member of the industry engaged in commerce' to pay or contract for the payment of advertising or promotional allowances or any other thing of value to or for the benefit of a customer of such member in the course of such commerce as compensation or in consideration for any services or facilities furnished by or through such customer in connection with the processing, handling, sale, or offering for sale of any products or commodities manufactured, sold, or offered for sale by such member, unless such payment or consideration is available on proportionally equal terms to all other customers competing in the distribution of such products or commodities.

(d) Prohibited discriminatory services or facilities. It is an unfair trade practice for any member of the industry to discriminate in favor of one purchaser against another purchaser or purchasers of a commodity bought for resale, with or without processing, by contracting to furnish or furnishing, or by contributing to the furnishing of, any services or facilities connected with the processing, handling, sale, or offering for sale of such commodity so purchased upon terms not accorded to all purchasers on proportionally equal terms.

(e) Inducing or receiving an illegal discrimination in price. It is an unfair trade practice for any member of the industry engaged in commerce,' in the course of such commerce, knowingly to induce or receive a discrimination in price which is prohibited by the foregoing provisions of this section.

(f) Purchases by schools, colleges, universities, public libraries, churches, hospitals, and charitable institutions not operated for profit. The foregoing provisions of this section relate to practices

within the purview of the RobinsonPatman Antidiscrimination Act, which act and the application thereunder of this section are subject to the limitations expressed in the amendment to such Robinson - Patman Antidiscrimination Act, which amendment was approved May 26, 1938, and reads as follows:

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That nothing in the Act approved June 19, 1936 (Public, Numbered 692, Seventy-fourth Congress, second session), known as the Robinson-Patman Antidiscrimination Act, shall apply to purchases of their supplies for their own use by schools, colleges, universities, public libraries, churches, hospitais, and charitable institutions not operated for profit." (52 Stat. 446; 15 U.S.C. 13c.)

[Rule 19]

§ 168.20 Discriminatory returns. It is an unfair trade practice for any member of the industry engaged in commerce 1 to discriminate in favor of one customerpurchaser against another customerpurchaser of industry products, bought from such member of the industry for resale, by contracting to furnish or furnishing in connection therewith, upon terms not accorded to all customer-purchasers on proportionally equal terms, the service or facility whereby such favored purchaser is accorded the privilege of returning products so purchased and receiving therefor credit or refund of puchase price: Provided, however, Nothing in any of the sections in this part shall prohibit or be used to prevent the return of merchandise by purchaser, for credit or refund of purchase price when and because such merchandise has been falsely or improperly labeled, branded, or represented, or when and because

such merchandise is defective contrary to warranty or purchase contract. [Rule 201

NOTE: For Group II rules, see 11 F.R. 8145.

PART 169-MASONRY WATERPROOFING INDUSTRY [ADDED]

As here used, the word "commerce" 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. (With respect to the Philippine Islands, the foregoing is subject to such statutory limitations as relate thereto.)

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§ 169.1 Deception (general). (a) It is an unfair trade practice to sell, offer for sale, or distribute any industry product, or to promote the sale or use thereof, by any method or under any circumstance or condition which has the capacity and tendency or effect of misleading or deceiving purchasers, prospective purchasers, or the public, as to the utility or efficacy of the product, or the results to be achieved by its use; or as to the quantity to be used, or regarding the grade, composition, ingredients, safety, ease or method of application, origin, or

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tions; or whether in any other form or through any other means. [Rule 1]

§ 169.2 Deceptive use of representations "waterproof," "waterproofing,” etc. (a) In the sale, offering for sale, or distribution of industry products, it is an unfair trade practice to use the word "waterproof," "waterproofing," or any other word or representation of similar import, as descriptive of any industry product unless, when properly integrated with or applied to masonry units or masonry structures, the product will render such units and structures impermeable to, or proof against the passage of, water and moisture throughout the life of such units or structures and under all conditions of water or moisture contactor exposure; subject, however, to the following further provisions of this section:

(b) If an industry product will effect such impermeability for a substantial ' period of time, although less than, or not known to be as long as, the life of the masonry unit or structure; or,

If for a substantial period of time the industry product will render some but not all types of masonry units or structures impermeable to water and moisture; or,

If for a substantial period of time the industry product will render masonry units or structures impermeable to water under some but not all conditions applicable in the use of the industry product or the function of such masonry units or structures:

Then the words "waterproof," "waterproofing," or representations of like import, may be used as descriptive of said industry product, Provided, Such words, terms, and representations are accompanied and qualified, in immediate con

1 When claim is made by the manufacturer or seller of improper application (or integration), it is deemed necessary under this rule that such manufacturer or seller show that clear, reasonable, and explicit instructions for application had been issued and made available to the purchaser and that the application of the product was not made in conformity with such instructions. When other or additional instructions or representations regarding application have been furnished or made verbally or in writing by the manufacturer or seller, or their agents, respectively, it is deemed necessary for such manufacturer or seller also to show that the application was not made in conformity therewith.

junction and in accordance with the following provisions, by a clear, conspicuous, and nondeceptive statement of limitations or disclosure showing the respective applicable limitations (i) of the period of time impermeability will endure, (ii) of the type or kind of masonry unit or structure in which the product will produce such impermeability, and (iii) of the other applicable conditions which need be present or absent in order for said result of impermeability to be achieved and to endure during said specified period of time; And provided further, That in the use of any of said words, terms, or representations in pursuance of the foregoing provisions of this section, the same are not used with such context, or advertising or labeling makeup, or in such other circumstance, as to be deceptive or misleading.

(1) Said accompanying and qualifying statement of limitations or disclosure shall not be deceptively minimized, remotely placed, obscured, or otherwise rendered inconspicuous in advertising matter or labeling, nor shall it be intermingled with such context or so fashioned in advertising or labeling make-up as to produce a confusing or misleading tendency or effect.

(2) Said statement of limitations or disclosure as to period of time impermeability will endure may be stated, when set forth nondeceptively, as a certain approximate minimum of years or months, which shall be deemed sufficiently accurate if such time is stated as being the approximate minimum and is shown to be accurate within reasonable tolerances; or said period of time may be stated in accordance with a reasonable average determined on the basis of actual experience in the use of the product under the various conditions which are or may be encountered, or in the event actual experience is not available and instances of failure of the product are unknown, the statement of approximate time limitation may be based upon adequate and scientifically recognized tests made under specified conditions and for the purpose of determining the length of time impermeability resulting from the product will endure. Said period of time may also be stated by showing a certain maximum, as, for example, "Will Give Protection Against Water and Moisture Up To Five Years," or by stating that impermeability will be afforded from a cer

tain minimum to a certain maximum period, or by stating that impermeable results cannot be assured beyond a certain stated period, Provided, Such maximum period is applicable in respect of the different types of uses of the product and is within a reasonable tolerance, And provided further, That the maximum period stated is generally applicable and not limited to isolated or exceptional uses or conditions unless it be fully disclosed that such maximum period is only applicable in such isolated or exceptional uses or conditions.

(3) Where the product will produce impermeability for a substantial period of time in some but not all masonry units or structures, said statement of limitations or disclosure shall also show the kind of masonry units or structures as to which the product is limited in producing impermeability or show the kind of masonry units or structures upon which the product will not produce impermeability, as, for example:

For House Basements Only.

For Home Foundations Other Than Cinder Block.

(4) Said statement of limitations or disclosure shall also show whether the product is to be used only for abovegrade or below-grade work (as, for example, "For Above-grade Brick Walls"), unless the product is such as to produce the impermeability for the time specified regardless of whether it is used above grade or below grade.

(5) Said statement of limitations or disclosure shall also show such other conditions or circumstances which will prevent the industry product from producing the result of impermeability during the specified time in masonry units or structures coming within the same general class of those for which the product is marketed unless the industry product is such as to produce the impermeability for the time specified regardless of any such conditions or circumstances.

(c) Use of the word "waterproofing" in name of corporation or company. Nothing in this part shall be construed as prohibiting use of the word "waterproofing" in the name of a corporation or company engaged in the business of manufacturing or marketing industry products or materials in conformity with the regulations in this part: Provided,

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