[Federal Register Volume 59, Number 54 (Monday, March 21, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-6535]
[[Page Unknown]]
[Federal Register: March 21, 1994]
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FEDERAL TRADE COMMISSION
[File No. 922 3330]
Samick Music Corporation; Proposed Consent Agreement With
Analysis To Aid Public Comment
AGENCY: Federal Trade Commission.
ACTION: Proposed 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
prohibit, among other things, a California subsidiary of a Korean piano
manufacturer from misrepresenting the composition of any of its piano
soundboards or any other piano parts in the future, and would require
the respondent to pay, to the U.S. Treasury, $266,000 as a disgorgement
remedy.
DATES: Comments must be received on or before May 20, 1994.
ADDRESSES: Comments should be directed to: FTC/Office of the Secretary,
room 159, 6th St. and Pa. Ave., NW., Washington, DC 20580.
FOR FURTHER INFORMATION CONTACT:
Bennett Rushkoff, FTC/H-200, Washington, DC 20580. (202) 326-3439.
SUPPLEMENTARY INFORMATION: Pursuant to section 6(f) of the Federal
Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46 and Sec. 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 or
views will be considered by the Commission and will be available for
inspection and copying at its principal office in accordance with
Sec. 4.9(b)(6)(ii) of the Commission's Rules of Practice (16 CFR
4.9(b)(6)(ii)).
Agreement Containing Consent Order To Cease and Desist
In the Matter of: Samick Music Corporation, a corporation.
The Federal Trade Commission having initiated an investigation of
certain acts and practices of Samick Music Corporation, a corporation,
and it now appearing that Samick Music Corporation, hereinafter
sometimes referred to as 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 Samick Music Corporation, by its
duly authorized officer, and its attorney, and counsel for the Federal
Trade Commission that:
1. Proposed respondent Samick Music Corporation is a corporation
organized, existing and doing business under and by virtue of the laws
of the State of California, with its office and principal place of
business located at 18521 Railroad Street, City of Industry, California
91748.
2. Proposed respondent admits all the jurisdictional facts set
forth in the draft of complaint here attached.
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 a 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, together with the draft
of complaint contemplated thereby, it 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 this 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 complaint (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 complaint here attached, or that the
facts as alleged in the draft complaint, other than jurisdictional
facts, are true.
6. This 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 right 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 to contradict the terms of the order.
7. Proposed respondent has read the proposed complaint and the
order contemplated hereby. It 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 Samick Music 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 advertising, offering for sale,
sale, or distribution of any piano in or affecting commerce, as
``commerce'' is defined in the Federal Trade Commission Act, forthwith
cease and desist from misrepresenting, directly or by implication, the
composition of piano soundboards or any other piano parts.
II
It is further ordered that, pursuant to 15 U.S.C. 57(b),
respondent, its successors and assigns, shall pay a refund of Two
Hundred Sixty-Six Thousand Dollars ($266,000), which, in view of the
impracticality of distributing the refund to consumers, shall be paid
to the United States Treasury. Such payment shall be by two cashier's
checks or certified checks made payable to the Treasurer of the United
States, the first such check, in the amount of One Hundred Thirty-Two
Thousand Dollars ($132,000), to be tendered to the Commission within
six months of the date of service of this Order, and the second such
check, in the amount of One Hundred Thirty-Four Thousand Dollars
($134,000), to be tendered to the Commission within twelve months of
the date of service of this Order.
III
It is further ordered that respondent shall maintain for a period
of three (3) years, and upon request make available to the Commission
for inspection and copying, all promotional, advertising or other
materials disseminated by respondent which make any representation
concerning the composition of soundboards in pianos advertised, sold,
distributed or offered for sale or distribution by respondent; all
consumer complaints concerning the composition of soundboards in pianos
advertised, sold, distributed or offered for sale or distribution by
respondent; and accurate records of all materials relied upon by
respondent to substantiate any representation concerning the
composition of soundboards in pianos advertised, sold, distributed or
offered for sale or distribution by respondent.
IV
It is further ordered that respondent shall notify the Commission
at least thirty (30) days period to any proposed change in respondent,
including but not limited to dissolution, assignment, sale resulting in
the emergence of a successor corporation, or the creation or
dissolution of subsidiaries, that may affect compliance obligations
arising out of the Order.
V
It is further ordered that respondent shall within thirty (30) days
after service of this Order, distribute this Order to each of its
officers, directors, managers and all personnel responsible for the
preparation or review of promotional material.
VI
It is further ordered that respondent shall, within sixty (60) days
after service of this Order, file with the Commission a report, in
writing, setting forth in detail the manner 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 to a
proposed consent order from Samick Music Corporation, of City of
Industry, California.
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 and will decide whether it should
withdraw from the agreement or make final the agreement's proposed
order.
The complaint attached to the proposed consent order alleges that
Samick Music Corporation's representations, disseminated in promotional
materials, that the soundboards in its pianos were ``solid spruce'' or
``spruce'' were false and misleading, because many such soundboards
were actually composed of outer layers of spruce with inner layers made
of another type or types of wood. The complaint alleges that this
practice is a violation of Section 5 of the Federal Trade Commission
Act.
The proposed consent order prohibits Samick Music Corporation from
misrepresenting, directly or by implication, the composition of piano
soundboards or any other piano parts. The proposed consent order also
contains a disgorgement remedy in the form of a $266,000 refund, which,
in view of the impracticality of distributing the refund to consumers,
shall be payable to the U.S. Treasury.
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 in any
way their terms.
Donald S. Clark,
Secretary.
[FR Doc. 94-6535 Filed 3-18-94; 8:45 am]
BILLING CODE 6750-01-M