[Federal Register Volume 59, Number 210 (Tuesday, November 1, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-27010]
[[Page Unknown]]
[Federal Register: November 1, 1994]
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FEDERAL TRADE COMMISSION
[File No. 911 0097]
Baby Furniture Plus Association, Inc.; 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, an Alabama buying cooperative and trade
association from taking any action on behalf of its members, or
encouraging them to take any action, that interferes with a juvenile
product manufacturer's decision as to how or to whom to distribute its
products. The consent agreement also would prohibit the respondent from
coercing--by means of actual or threatened refusals to deal--any
juvenile products manufacturer to abandon or adopt--or to refrain from
abandoning or adopting--any marketing method for its products.
dates: Comments must be received on or before January 3, 1995.
addresses: Comments should be directed to: FTC/Office of the Secretary,
Room 159, 6th Street and Pennsylvania Avenue NW., Washington, DC 20850.
for further information contact: Phoebe Morse, Boston Regional Office,
Federal Trade Commission, 101 Merrimac St., Suite 810, Boston, MA
02114-4719. (617) 424-5960.
supplementary information: Pursuant to section 6(f) of the Federal
Trade Commission Act, 38 State. 721, 15 U.S.C. 46 and Sec. 2.34 of the
Commission's rules of practice (16 CFR 2.35), 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
The Federal Trade Commission having initiated an investigation of
certain acts and practices of the Baby Furniture Plus Association, Inc.
(``BFPAI'') and it now appearing that the BFPAI, hereinafter 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 the BFPAI, by its duly
authorized officer, and counsel for the Federal Trade Commission that:
1. Proposed respondent Baby Furniture Plus Association, Inc. is a
corporation organized, existing and doing business under and by virtue
of the laws of the Commonwealth of Virginia, with its principal office
and place of business located at Suite 1, 1020 Montgomery Highway,
Birmingham, Alabama 35216. Respondent is a voluntary association of
retailers of juvenile products doing business in approximately twenty-
five States.
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;
(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.
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, 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 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 of facts, other than
jurisdictional facts, or of violations of law as alleged in the draft
of complaint here attached.
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
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 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 might 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 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
For purposes of this order, the following definitions shall apply:
A. ``Baby Furniture Plus Association, Inc.'' means Baby Furniture
Plus Association, Inc., and its directors, committees, officers,
representatives, agents, employees, successors and assigns.
B. ``Juvenile products'' means products or accessories to products
that are used by or are intended for use by babies, children or
juveniles.
I
It is ordered that BFPAI, directly, indirectly, or through any
corporate or other device, in or in connection with its activities in
or affecting commerce, as ``commerce'' is defined in section 4 of the
Federal Trade Commission Act, as amended, forthwith cease and desist
from:
A. Taking any action, directly or indirectly, on behalf of its
members, including but not limited to any actual or threatened boycott
or refusal to deal, that has the purpose or effect of interfering with
any juvenile product manufacturer's decision as to how or to whom it
distributes its product(s);
B. Coercing, compelling, inducing, or intimidating by means of
actual or threatened refusals to deal, or attempting to coerce, compel,
induce, or intimidate by means of actual or threatened refusals to
deal, any manufacturer of juvenile products into abandoning, adopting
or refraining from abandoning or adopting any marketing method,
practice or policy with regard to the distribution of its product(s);
and
C. Requesting, urging, recommending or suggesting that BFPAI
members take any action, directly or indirectly, including but not
limited to any actual or threatened boycott or refusal to deal, which
has the purpose or effect of interfering with any juvenile product
manufacturer's decision as to how or to whom it distributes its
product(s).
Provided that this order shall not be construed to prevent BFPAI
from engaging in trade association or buying cooperative activities
that are lawful under the antitrust laws.
II
It is further ordered that BFPAI shall:
A. Distribute by first-class mail a copy of this order and the
accompanying complaint to each of BFPAI's members within thirty (30)
days after the date on which this order become final;
B. For a period of five (5) years after the date on which this
order becomes final, provide each new BFPAI member with a copy of this
order and the accompanying complaint at the time the member is accepted
for membership; and
C. Within thirty (30) days after the date on which this order
becomes final, distribute by first-class mail to each manufacturer
enumerated in ``Appendix A'' to this order a copy of the Commission's
complaint and order in this matter and letter, on BFPAI letterhead and
signed by BFPAI's president, in the form shown as ``Appendix B'' to
this order.
III
It is further ordered that, for a period of five (5) years after
this order becomes final, BFPAI shall maintain in its files a copy of
the minutes of each meeting of its membership and of each meeting of
its board of directors and a copy of all correspondence received from,
or sent to, any mail order dealer of juvenile products, any
manufacturer of juvenile products, or any association representing
manufacturers of juvenile products and that such copies of minutes and
correspondence be made available to Commission staff for inspection and
copying upon reasonable notice.
IV
It is further ordered that, within sixty (60) days after the date
on which this order becomes final, BFPAI shall file with the Commission
a verified written report setting forth in detail the manner and form
in which it has complied with this order. Thereafter, additional
reports shall be filed at such other times as the Commission or its
staff may, by written notice to BFPAI, require.
V
It is further ordered that BFPAI shall notify the Commission at
least thirty (30) days prior to any proposed change in the corporation
such as a dissolution, assignment, or sale resulting in the emergence
of a successor corporation or association, or any other change in the
corporation or association which may affect compliance obligations
arising out of this order.
Appendix A
A.D.I. Lamps, P.O. Box 6357, Phoenix, AZ 85005, Attn: National Sales
Manager
Aprica U.S.A., Inc. P.O. Box 25408--Zip 92825-5408, 1200 Howell
Avenue, Anaheim, CA 92805, Attn: National Sales Manager
Baby Trend, Inc., 1928 W. Holt Avenue, Pomona, CA 91768, Attn:
National Sales Manager
Bandaks Emmaljunga Incorporated, 737 South Vinewood Street,
Escondido, CA 92029, Attn: National Sales Manager
Bassett Furniture Industries, Inc., P.O. Box 626, Bassett, VA 24055,
Attn: National Sales Manager
Carlson Children's Products, Inc., 122 Kirkland Circle, Oswego, IL
60543, Attn: National Sales Manager
Century Products Company, 9600 Valley View Road, Macedonia, OH
44056-9989, Attn: National Sales Manager
Chicco Artsana of America, 200 Fifth Ave., Rm 910, New York, NY
10010, Attn: National Sales Manager
Child Craft Industries, Inc., P.O. Box 444, Salem, IN 47167-0444,
Attn: National Sales Manager
Children on the Go, 1670 S. Wolf Road, Wheeling, IL 60090, Attn:
National Sales Manager
Cocso, Inc., 2525 State St., Columbus, IN 47201, Attn: National
Sales Manager
Dutalier, Inc., 298 Chaput St. Pie, Quebec, Canada JOH 1WO, Attn:
National Sales Manager
Evenflo Juvenile Furniture Co., 1801 Commerce Drive, Piqua, OH
45356, Attn: National Sales Manager
FBS, Inc., 1071 Batesville, Rd., Greer, SC 29650, Attn: National
Sales Manager
Fisher-Price, Inc., 636 Girard Ave., East Aurora, NY 14052, Attn:
National Sales Manager
Gerry Baby Products, 12530 Grant Drive, Denver, CO 80233, Attn:
National Sales Manager
Glenna Jean Mfg., P.O. Box 2187, Petersburg, VA 23804, Attn:
National Sales Manager
Graco Children's Products, Inc., Rt 23, Main St., Elverson, PA
19520, Attn: National Sales Manager
Jolly Jumper, P.O. Box M, Woonsocket, RI 22895, Attn: National Sales
Manager
Lambs & Ivy, 5978 Bowcroft St., Los Angeles, CA 90016, Attn:
National Sales Manager
The Little Tikes Co., 2180 Barlow Rd., Hudson, OH 44236, Attn:
National Sales Manager
Newborne Company, River Rd., Worthington, MA 01098, Attn: National
Sales Manager
Noel Joanna Inc., 22942 Arroyo Vista, Rancho Santa Margarita, CA
92688, Attn: National Sales Manager
Nu-Line, 214 Nu-Line St., Suring, WI 54174, Attn: National Sales
Manager
Omron Marshall Products, 600 Barclay Blvd., Lincolnshire, IL 60069,
Attn: National Sales Manager
Pansy Ellen Products, 1245 Old Alpharetta Rd., Alpharetta, GA 30202,
Attn: National Sales Manager
Perego, USA, 3625 Indpendence Drive, Fort Wayne, IN 46808, Attn:
National Sales Manager
Prince Lionheart, 3070 Skyway Dr., Bldg. 502, Santa Maria, CA 93455,
Attn: National Sales Manager
The Red Calliope & Associates, Inc., 13003 S. Figueroa St., Los
Angeles, CA 90061, Attn: National Sales Manager
Rochelle Furniture, 722 North Market St., Duncannon, PA 17020, Attn:
National Sales Manager
Safety 1st, Inc., 210 Boylston St., Chestnut Hill, MA 02167, Attn:
National Sales Manager
Sandbox Industries, P.O. Box 477, Tenafly, NJ 07670, Attn: National
Sales Manager
Sassy, Inc., 1534 College SE, Grand Rapids, MI 49507, Attn: National
Sales Manager
Simmons Juvenile Products Co., 613 E. Beacon Avenue, New London, WI
54961, Attn: National Sales Manager
Snugli, Inc., 12520 Grant Drive, Denver, CO 80233, Attn: National
Sales Manager
Summer Infant Products, 33 Meeting Street, Cumberland, RI 02864,
Attn: National Sales Manager
Welsh Company, 1535 S. Eighth St., St. Louis, MO 63104, Attn:
National Sales Manager
Appendix B
Dear-------------------------------------------------------------------
As you may be aware, the Federal Trade Commission (``FTC'') has
been investigating certain activities of the Baby Furniture Plus
Association, Inc. (``BFPAI''). The BFPAI has voluntarily entered
into an agreement with the FTC which resulted in the issuance by the
FTC on (date) of a complaint and the entry of a consent order. The
order requires that you be sent a copy of the complaint, the order
and this letter.
In accordance with the terms of the FTC's order, you are hereby
notified that, among other things, the BFPAI will cease and desist
from:
A. Taking any action, directly or indirectly, on behalf of its
members, including but not limited to any actual or threatened
boycott or refusal to deal, that has the purpose or effect of
interfering with any juvenile product manufacturer's decision as to
how or to whom it distributes its products(s);
B. Coercing, compelling, inducing, or intimidating by means of
actual or threatened refusals to deal, or attempting to coerce,
compel, induce, or intimidate by means of actual or threatened
refusals to deal, any manufacturer of juvenile products into
abandoning, adopting or refraining from abandoning or adopting any
marketing method, practice or policy with regard to the distribution
of its product(s); and
C. Requesting, urging, recommending or suggesting that BFPAI
members take any action, directly or indirectly, including but not
limited to any actual or threatened boycott or refusal to deal,
which has the purpose or effect of interfering with any juvenile
product manufacturer's decision as to how or to whom it distributes
its product(s).
A copy of the complaint and the order are enclosed.
Sincerely,
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President
Enclosures
Analysis of Proposed Consent Order to Aid Public Comment
The Federal Trade Commission has accepted, subject to final
approval, an agreement to a proposed consent order from proposed
respondent Baby Furniture Plus Association, Inc. (``proposed
respondent'' or ```BFPAI'').
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 agreement's proposed order.
Description of Complaint
A complaint prepared for issuance by the Commission along with the
proposed order alleges that proposed respondent's members, all of whom
are retailers of juvenile products, agreed to act in concert to
restrict the competition that some of the members faced from the New
Hampshire Buyer's Service catalog.
The complaint alleges that pursuant to this agreement, the BFPAI
wrote letters to thirty-seven manufacturers of juvenile products in
which it directly or impliedly threatened that its members would refuse
to deal with them if the manufacturers continued to do business with
the New Hampshire Buyer's Service catalog.
The complaint alleges that these actions constituted a combination
or conspiracy to threaten to boycott juvenile product manufacturers
that do business with the New Hampshire Buyer's Service catalog. This
conduct, it is alleged, had the purpose or effect, or the tendency or
capacity, to restrain competition unreasonably and injure consumers.
Among other things, it is alleged that the conduct restrained
competition between the proposed respondent's members and other
retailers of juvenile products, including the New Hampshire Buyer's
Service catalog, restrained the ability of manufacturers of juvenile
products to distribute their products through mail order catalogs, and
deprived consumers of the benefits of additional price, quality and
service competition in connection with the sale of juvenile products.
Description of the Proposed Consent Order
The proposed order would require the proposed respondent to cease
and desist from taking any action on behalf of its members, including
an actual or threatened boycott or refusal to deal, that has the
purpose or effect of interfering with a juvenile product manufacturer's
decision as to how or to whom it distributes its products. In addition,
the proposed order requires the BFPAI to cease and desist from actual
or threatened boycotts, refusals to deal or the use of other means of
coercion to compel or induce any juvenile product manufacturer to adopt
or refrain from adopting any marketing method, practice or policy with
regard to the distribution of its products. Finally, the proposed order
requires the proposed respondent to cease and desist from requesting,
urging, recommending or suggesting that its members take action, such
as an actual or threatened boycott or refusal to deal, which has the
purpose or effect of interfering with a juvenile product manufacturer's
decision as to how or to whom it distributes its products.
The proposed order contains a safe harbor provision which provides
that the order shall not be construed to prevent the BFPAI from
engaging in trade association or buying cooperative activities that are
lawful under the antitrust laws.
The BFPAI is required to take several remedial actions under the
terms of the proposed order. Within 30 days after the order becomes
final, the BFPAI must distribute a copy of the order to all its members
and, for a five year period, the BFPAI must make a copy of the order
available to all new members at the time they are accepted for
membership. In addition, within 30 days after this order becomes final,
the BFPAI must also send a letter to the manufacturers it had
threatened to boycott in which it acknowledges the consent order and
outlines the order's principal terms.
Finally, the proposed order requires the BFPAI to file compliance
reports, to retain certain documents for a five year period, and to
notify the Commission of certain changes in status.
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.
The proposed consent order has been entered into for settlement
purposes only and does not constitute an admission by the proposed
respondent that the law has been violated as alleged in the complaint.
Donald S. Clark,
Secretary.
Dissenting Statement of Commissioner Mary L. Azcuenaga in New England
Juvenile Retailers Association, File 911-0079, and Baby Furniture Plus
Association, Inc., File 911-0097
In these cases, two trade associations complained to manufacturers
about free riding by a catalogue seller, and the Commission charges
them and the retailer members of one association with directly or
impliedly threatening a concerted refusal to deal with the
manufacturers. Although the letters of complaint were ill-advised,
evidence that the retailers (many of whom were not represented by
counsel during our investigation) were committed ``to a common scheme
designed to achieve an unlawful objective''\1\ (i.e., a coercive,
concerted refusal to deal) is thin at best. Given the dearth of
evidence of unlawful agreement, the arguably procompetitive purpose,
and the absence both of market power and of anticompetitive effects, I
do not find reason to believe that the challenged conduct unreasonably
restrained trade or that the imposition of an order is in the interest
of the public. I dissent.
\1\Monsanto Co. v. Spray-Rite Service Corp., 465 U.S. 752, 768
(1984).
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[FR Doc. 94-27010 Filed 10-31-94; 8:45 am]
BILLING CODE 6750-01-M