[Federal Register Volume 59, Number 128 (Wednesday, July 6, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-16277]


[[Page Unknown]]

[Federal Register: July 6, 1994]


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FEDERAL TRADE COMMISSION
[File No. 932 3115]

 

Macy's Northeast, Inc., et al.; 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 
require, among other things, the New York-based retail department store 
subsidiaries to comply with the Pre-Sale Availability Rule under the 
Magnuson-Moss Warranty Act, to inform their retail store managers of 
their compliance responsibilities, and to develop and implement a 
program for instructing their sales personnel about the availability 
and location of manufacturers' warranty information.

DATES: Comments must be received on or before September 6, 1994.

ADDRESSES: Comments should be directed to: FTC/Office of the Secretary, 
Room 159, 6th St. and Pa. Ave., N.W., Washington, D.C. 20580.

FOR FURTHER INFORMATION CONTACT: Jeffrey Klurfeld or Gerald Wright, 
FTC/San Francisco Regional Office, 901 Market St., Suite 570, San 
Francisco, CA. 94103. (415) 744-7920.

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 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 Section 4.9(b)(6)(ii) of the Commission's Rules of 
Practice (16 CFR 4.9(b)(6)(ii)).
    The Federal Trade Commission having initiated an investigation of 
Macy's Northeast, Inc., Macy's South, Inc., Macy's California, Inc., 
and Bullock's, Inc. (``proposed respondents'' or ``respondents'', 
corporations, and wholly-owned subsidiaries of R.H. Macy & Co., Inc., a 
Delaware corporation, and it is now appearing that proposed respondents 
are will to enter into an agreement containing an order to cease and 
desist from the acts and practices being investigated,
    It is hereby agreed by and between Macy's Northeast, Inc., Macy's 
South, Inc., Macy's California, Inc., and Bullock's, Inc., by their 
duly authorized officers, and counsel for the Federal Trade Commission 
that:
    1. Proposed respondent Macy's Northeast, Inc. is a corporation 
organized, existing, and doing business under and by virtue of the laws 
of the State of Delaware, with its principal office and place of 
business located at 151 W 34th Street, New York, New York 10001.
    Proposed respondent Macy's South, Inc. is a corporation organized, 
existing, and doing business under and by virtue of the laws of the 
State of Delaware, with its principal office and place of business 
located at 151 W. 34th Street, New York, New York 10001.
    Proposed respondent Macy's California, Inc. is a corporation 
organized, existing, and doing business under and by virtue of the laws 
of the State of Delaware, with its principal office and place of 
business located at 50 O'Farrell Street, San Francisco, California 
94102.
    Proposed respondent Bullock's Inc. is a corporation organized, 
existing, and doing business under and by virtue of the laws of the 
State of Delaware, with its principal office and place of business 
located at 50 O'Farrell Street, San Francisco, California 94102.
    2. This agreement is for settlement purposes only and does not 
constitute an admission by proposed respondents that the law has been 
violated as alleged in the draft of complaint here attached.
    3. Proposed respondents admit all the jurisdictional facts set 
forth in the draft complaint here attached.
    4. Proposed respondents waive:
    a. Any further procedural steps;
    b. The requirement that the Commission's decision contain a 
statement of findings of fact and conclusions of law;
    c. All rights to seek judicial review or otherwise to challenge or 
contest the validity of the order entered pursuant to this agreement; 
and
    d. All claims under the Equal Access to Justice Act.
    5. This agreement shall not become 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, it, together with the draft of 
complaint contemplated thereby, 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 its acceptance 
of this agreement and so notify the proposed respondents, 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 this proceeding.
    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 Sec. 2.34 of the Commission's 
Rules, the Commission may, without further notice to proposed 
respondents, (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 respondents' addresses as stated in this agreement shall 
constitute service. Proposed respondents waive any right they 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 the 
agreement may be used to vary or contradict the terms of the order.
    7. Proposed respondents have read the proposed complaint and order 
contemplated hereby. They understand that once the order has been 
issued, they will be required to file one or more compliance reports 
showing that they have fully compiled with the order. Proposed 
respondents further understand that they may be liable for civil 
penalties in the amount provided by law for each violation of the order 
after it becomes final.

Order

    The definitions of terms contained in Sec. 101 of the Magnuson-Moss 
Warranty Act, 15 U.S.C. 2301, and in rule 702, 16 C.F.R. Sec. 702.1, 
promulgated thereunder, shall apply to the terms of this Order.
I
    It is ordered that respondents Macy's Northeast, Inc., Macy's 
South, Inc., Macy's California, Inc., and Bullock's, Inc., 
corporations, their successors and assigns, and their officers, 
representatives, agents and employees, directly or through any 
corporation, subsidiary, division or other device in connection with 
the sale or offering for sale of any consumer product in or affecting 
commerce, do forthwith cease and desist from failing to make a text of 
any written warranty on a consumer product actually costing more than 
$15 readily available for examination by prospective buyers prior to 
sale through utilization of one or more means specified in 16 CFR 
702.3(a), as amended.
II
    It is further ordered that respondents shall, within thirty (30) 
days of the date of service of this Order, deliver to each current 
retail store manager and assistant or operations manager engaged in the 
sale of consumer products on behalf of respondents, a copy of this 
Order to cease and desist.
III
    It is further ordered that respondents shall, within thirty (30) 
days of the date of service of this Order, instruct all current retail 
store managers and assistant or operations managers engaged in the sale 
of consumer products on behalf of respondents as to their specific 
obligations and duties under the Magnuson-Moss Warranty Act (15 U.S.C. 
2301) and this Order.
IV
    It is further ordered that respondents shall, for a period of not 
less than four (4) years from the date of service of this order, 
instruct all future retail store managers and assistant or operations 
managers who will be engaged in the sale of consumer products on behalf 
of respondents, before they assume said responsibilities for 
respondents, as to their specific obligations and duties under the 
Magnuson-Moss Warranty Act (15 U.S.C. 2301) and this Order.
V
    It is further ordered that respondents shall, within thirty (30) 
days of the date of service of this Order, develop and implement a 
program to instruct their sales personnel about the availability and 
location of warranty information.
VI
    It is further ordered that respondents shall, for a period of not 
less than five (5) years from the date of service of the Order, 
maintain and upon request make available to the Federal Trade 
Commission for inspection and copying (i) copies of all written 
instructions provided by respondents to their retail store managers and 
assistant and operations managers and sales personnel regarding their 
obligations and duties under the Magnuson-Moss Warranty Act (15 U.S.C. 
2301) and this order; (ii) copies of signs posted by respondents in 
their retail store outlets designed to elicit prospective buyers' 
attention to the availability of the text of written warranties for 
review upon request; and (iii) copies of the text of written warranties 
made readily available by respondents' retail store outlets for 
examination by prospective buyers on request.
VII
    It is further ordered that respondents, for a period of six (6) 
years from the date of service of this Order, shall notify the 
Commission at least thirty (30) days prior to any dissolution, 
assignment, or sale resulting in the emergence of a successor 
corporation, the creation or dissolution of subsidiaries, or any other 
change in the corporation that may affect compliance obligations 
arising out of the Order.
VIII
    It is further ordered that respondents shall, within ninety (90) 
days after service of this Order on them, file with the Commission a 
report in writing, setting forth in detail the manner and form in which 
they have 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 Macy's Northeast, Inc., Macy's South, Inc., 
Macy's California, Inc., and Bullock's, Inc. (``proposed 
respondents''), wholly-owned subsidiaries of R.H. Macy & Co., Inc. 
Proposed respondents operate department stores in New York, California, 
and a number of other states.
    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 and take other appropriate action, or make 
final the proposed order contained in the agreement.
    The complaint alleges that the proposed respondents have violated a 
Rule promulgated by the Federal Trade Commission (16 CFR 702.3(a)) 
pursuant to the Magnuson-Moss Consumer Warranty Act (15 U.S.C. 2301). 
This Rule requires the proposed respondents to make manufacturers' 
warranty information available to consumers. The purposes of this Act, 
and the Rule, are to improve the information available to consumers, to 
prevent deception, and to promote competition, in the marketing of 
consumer product warranties offered by manufacturers.
    The Rule, called the ``Pre-Sale Availability Rule,'' gives 
retailers the option of either (1) displaying the text of 
manufacturers' warranties in close proximity to the product display; or 
(2) furnishing the text of manufacturers' warranties to customers upon 
request, and prominently displaying signs advising of the availability 
of such warranties. The complaint alleges that the proposed respondents 
have not complied with either of these options.
    The proposed order requires proposed respondents to comply with 
this Rule, to inform their retail store executives of their compliance 
responsibilities, and to develop a program for instructing their sales 
personnel about the availability and location of manufacturers' 
warranty information. Proposed respondents will be subject to civil 
penalties if they do not comply with the order.
    The purpose of this analysis is to facilitate public comment on the 
proposed order. 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. 94-16277 Filed 7-5-94; 8:45 am]
BILLING CODE 6750-01-M