§ 88.1

GROUP I

Inducing breach of contract.

It is an unfair trade practice to induce or attempt to induce the breach of existing lawful contracts between competitors and their customers, or their suppliers, by any false or deceptive means whatsoever, or to interfere with or obstruct 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.

§ 88.2 Defamation of competitors or disparagement of their products or service.

The defamation of competitors by falsely imputing to them dishonorable conduct, inability to perform contracts, questionable credit standing or integrity, or by other false representations, or the false disparagement of the grade, quality, durability, workmanship, quantity, composition, construction, specifications, make, type, size, origin, appearance, value, or performance of their products, or of the nature, quality, or extent of the service furnished by them, or of their prices, credit terms, or contract conditions, or of their business methods, practices, or policies, is an unfair trade practice.

§ 88.3 Procurement of

confidential information.

competitors'

It is an unfair trade practice for any member of the industry to obtain information concerning the business of a competitor by bribery of an employee or agent of such competitor, by false or misleading statements or representations, by the impersonation of one in authority, or by any other unfair means, and to use

the information so obtained in such manner as to injure said competitor in his business or to suppress competition or unreasonably restrain trade.

§ 88.4 Prejudicing competitors' relationships with their agents.

It is an unfair trade practice for any member of the industry to induce, or attempt to induce, an agent of a competitor to become the industry member's agent also, with the understanding or agreement between such industry member and agent that, though retaining his agency relationship with such competitor, such agent is not to continue to promote in good faith the business of such competitor.

Willfully enticing away the employees of competitors with the purpose and effect of thereby unduly hampering or injuring competitors in their business and destroying or substantially lessening competition is an unfair trade practice: Provided, however, That nothing in this section shall be construed as prohibiting employees from obtaining more favorable employment.

§ 88.6 Commercial bribery.

It is an unfair trade practice for any member of the industry, directly or indirectly, to give or permit to be given, or offer to give, money or anything of value to agents, employees, or representatives of customers or prospective customers, or to agents, employees, or representatives of competitors' customers or prospective customers, without the knowledge of their employers or principals, as an inducement to influence their employers or principals to purchase or contract for the supplying or servicing of saws, saw frames, blades, meat-chopper plates, knives, or other articles from the maker of such gift or offer, or to influence such employers or principals to refrain from dealing or contracting to deal with competitors.

§ 88.7 Deception of customers of competitors as to identity.

It is an unfair trade practice for any member of the industry, his agent or representative, to feign his identity to a customer of a competitor as being that of an agent or representative of such competitor and thereby obtain possession of money or property belonging to a com

(a) It is an unfair trade practice for any member of the industry to sell, lease, loan, or otherwise furnish to any customer or prospective customer, any saw frame, grinding or cutting machine, saws, knives, blades, or plates, or any other article of property, on the condition, agreement, or understanding that such customer shall not use, or contract for the use of, machinery, supplies, or other articles of property of a competitor or competitors of such industry member, where the effect of such condition, agreement, or understanding may be to substantially lessen competition or tend to create a monopoly in any line of

commerce.

(b) The inhibitions of this section shall apply though the furnishing of property by industry member upon such condition be without charge to the customer.

§ 88.10

Transactions below cost.

(a) The practice of selling or supplying equipment and service below the seller's or supplier's cost, when pursued with wrongful intent of thereby injuring a competitor and where the effect of such practice is to unreasonably restrain trade, tend to create a monopoly, or substantially lessen competition, is an unfair trade practice.

(b) This section is not to be construed as prohibiting all transactions below cost, but only such selling or supplying below the seller's or lender's cost as is resorted to and pursued as a monopolistic practice with the wrongful intent referred to and coupled with the effect of unreasonably restraining trade, tending to create a

The making of any guarantee or purported guarantee respecting the efficacy, durability, or quality of an industry product or service which has the capacity and tendency or effect of deceiving customers or prospective customers, or which is impossible for the guarantor to assure because of contingencies over which he has no control, or which is not made in good faith, is an unfair trade practice. § 88.12

Substitution of products.

The practices of shipping or delivering products which do not conform to samples submitted, to specifications upon which the sale or loan is consummated, or to representations made prior to securing the order or contract, without the consent of the purchasers or borrowers to such substitutions, and with the tendency and capacity or effect of misleading or deceiving purchasers, borrowers, prospective purchasers or borrowers, is an unfair trade practice.

§ 88.13 Coercing purchase

one

of product as a prerequisite to the purchase of other products.

The practice of coercing the purchase or loan of one or more products as a prerequisite to the purchase or loan of one or more other products, where the effect may be to substantially lessen competition or tend to create a monopoly or to unreasonably restrain trade, is an unfair trade practice.

§ 88.14 False and misleading price quo

tations.

The publishing or circulating by any member of the industry of false or misleading price quotations, price lists, or terms of sale or loan, with the capacity and tendency or effect of thereby misleading or deceiving the purchaser or borrower, is an unfair trade practice.

§ 88.15 False advertising.

Making, or causing to be made or published, any false, misleading, or deceptive statement or representation, by way of advertisement or otherwise, concerning

It is an unfair trade practice to falsely or deceptively mark, brand, or label any products of the industry with any word, phrase, mark, name, label, design, device, or other representation with respect to the size, quality, durability, finish, material, or construction of such products or of any of the component parts thereof. § 88.17 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, in the course of such commerce, to grant, or allow, secretly or openly, directly or indirectly, any rebate, refund, discount, credit, dating of commencement of service, or other form of price differential, whether in the form of free service or otherwise, where such rebate, refund, discount, credit, dating of commencement of service, or other form of price differential, effects a discrimination in price between different purchasers or customers of goods of like grade and quality, where either or any of the transactions involved therein are in commerce, and where the effect thereof 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 or supplied for use, consumption, or resale within any place under the jurisdiction of the United States;

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

(3) That nothing contained in this section shall prevent persons engaged in selling or supplying goods, wares, or merchandise in commerce from selecting

their own customers in bona fide transactions and not in restraint of trade;

(4) That nothing contained in this section 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, distress sales under court process, or sales made in good faith in discontinuance of business in the goods concerned.

(b) Prohibited brokerage and commission. 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 commission, brokerage, or other compensation, or any allowance or discount in lieu thereof, except for services rendered in connection with the sale, purchase, or supplying 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) 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.

(d) Purchases by or loans to schools, colleges, universities, hospitals, and charitable institutions not operated for profit. The Robinson-Patman Antidiscrimination 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, 1963 (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, hospitals, and charitable institutions not operated for profit.

(Sec. 2, 38 Stat. 730, as amended, secs. 2, 3, 4, 49 Stat. 1527, 1528, ch. 283, 52 Stat. 446; 15 U. S. C. 13, 13a, 13b, 13c, 21a)

§ 88.18 Aiding or abetting use of unfair trade practices.

It is an unfair trade practice for any person, firm, or corporation to aid, abet, coerce, or induce another, directly or indirectly, to use or promote the use of any unfair trade practice specified in the regulations of this part.

The industry expresses its approval of the trade custom of granting such limited trial period as is necessary to acquaint new customers with a product or present customers with a new type of product. However, the industry condemns the practice of hampering a competitor in his relations with a customer by furnishing equipment to such customer free of charge for a period of time in excess of that reasonably required for a fair trial thereof under the subterfuge of granting a trial period.

NOTE: § 88.101 is also subject to the limitation that the furnishing of any equipment shall not be accomplished in such manner as to effect a discrimination contrary to § 88.17.

In the competition attendant upon the exchanging, lending, selling, and supplying of saw frames, blades, meatchopper plates, and knives, the said articles are frequently lost and come into the hands of a competitor or competitors of the owner who fails not only to disclose the fact of his find, but actually converts the said saw frames, blades, meat-chopper plates, and knives to his own use. This practice is strongly condemned by the industry.

§ 88.103 Arbitration.

The industry approves the practice of handling business disputes between members of the industry and their customers in a fair and reasonable manner, coupled with a spirit of moderation and good will, and every effort should be made by the disputants themselves to compose their differences. If unable to do so they should, if possible, submit these disputes to arbitration.

89.201 Industry committee.

AUTHORITY: The provisions of this Part 89 issued under secs. 6(g), 5, 38 Stat. 722, 719; 15 U.S.C. 46 (g), 45.

SOURCE: The provisions of this Part 89 contained in trade practice rules, Ice Cream Industry, District of Columbia and Vicinity, FTC, Mar. 20, 1933, unless otherwise noted. GROUP I

$89.2 Products not conforming to legal requirements.

The sale or offering for sale of any product as ice cream which does not con

form to the requirements of the act of Congress approved February 27, 1925 (43 Stat. 1004), is an unfair trade practice. § 89.3 False marking or labeling.

The false marking or labeling of icecream products or the aiding or abetting in the false marking or labeling of icecream products, or the misrepresentation of the character or manufacture of icecream products, or the sale or offering for sale of ice cream products in any manner calculated to mislead or deceive purchasers with respect to the kind, character, quantity, quality, grade, or origin of the products is an unfair trade practice.

§ 89.4 Defamation of competitors.

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 grade or quality of their goods, with the tendency and capacity to mislead or deceive purchasers or prospective purchasers, is an unfair trade practice.

§ 89.5 Enticing employees.

Willfully enticing away the employees of competitors with the purpose and effect of unduly hampering, injuring, or embarrassing competitors in their businesses, is an unfair trade practice. § 89.6

Sales below cost.