[Federal Register Volume 60, Number 2 (Wednesday, January 4, 1995)]
[Notices]
[Pages 467-469]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-94]



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FEDERAL TRADE COMMISSION
[File No. 932 3356]


Louis Bass, 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, a Wisconsin corporation, doing business 
as Crestwood Company, from making false or unsubstantiated performance 
claims about any communication aid it offers in the future, and from 
making representations concerning the efficacy of the communication 
devices in enabling individuals with disabilities to communicate 
through facilitated communication, unless the respondent has competent 
and reliable scientific evidence to substantiate the representation.

DATES: Comments must be received on or before March 6, 1995.

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 Kerry O'Brien, San Francisco Regional Office, 
Federal Trade Commission, 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)).

Agreement Containing Consent Order To Cease and Desist

    The Federal Trade Commission having initiated an investigation of 
certain acts and practices of Louis Bass, Inc. (d/b/a Crestwood 
Company), a corporation, and it now appearing that Louis Bass, Inc. (d/
b/a Crestwood Company), a 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 Louis Bass, Inc. (d/b/a 
Crestwood Company), by its duly authorized officer, and its attorney, 
and counsel for the Federal Trade Commission that:
    1. Proposed respondent Louis Bass, Inc. is a corporation organized, 
existing and doing business under and by virtue of the laws of the 
State of Wisconsin, with its office and principal place of business 
located at 6625 North Sidney Place, in the City of Glendale, State of 
Wisconsin.
    2. Proposed respondent admits all the jurisdictional facts set 
forth in the draft of complaint.
    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 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 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.
    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, (a) issue its complaint corresponding in form and 
substance with the draft of complaint and its decision containing the 
following order to cease and desist in disposition of the proceeding 
and (b) 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 the agreement may be used 
to vary or contradict the terms of the order.
    7. Proposed respondent has read the proposed complaint and order 
contemplated hereby. Proposed respondent 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.
[[Page 468]]

Order

Definitions
    For the purposes of this order, the following definitions shall 
apply:
    A. The term ``Communication aid'' means any alphabet display chart, 
computer, typewriter or other device, which is created or marketed for 
use by persons with communication impairments, including the 
``Crestalk'' and ``Canon Communicator.''
    B. The term ``Facilitated Communication'' means any method or 
technique or process that entails an individual providing physical 
support to a person with a communication impairment, while that person 
types or points to a communication aid.
I.
    It is ordered that respondent, Louis Bass, Inc. (d/b/a/ Crestwood 
Company), a 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 manufacturing, labeling, advertising, promotion, offering for sale, 
sale, or distribution of any communication aid, in or affecting 
commerce, as ``commerce'' as defined in the Federal Trade Commission 
Act, do forthwith cease and desist from misrepresenting, in any manner, 
directly or by implication, that such product enables autistic 
individuals to communicate through facilitated communication.
II.
    It is further ordered that respondent, Louis Bass, Inc. (d/b/a 
Crestwood Company), a 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 he manufacturing, labeling, advertising, promotion, offering for 
sale, sale, or distribution of any communication aid, in or affecting 
commerce, as ``commerce'' as defined in the Federal Trade Commission 
Act, do forthwith cease and desist from representing, in any manner, 
directly or by implication, that such product enables individuals with 
disabilities to communicate through facilitated communication, unless 
such representation is true and, at the time of making such 
representation, respondent possesses and relies upon competent and 
reliable scientific evidence that substantiates the representation. For 
purposes of this Order, ``competent and reliable scientific evidence'' 
shall mean tests, analyses, research, studies or other evidence based 
on the expertise of professionals in the relevant area, that has been 
conducted and evaluated in an objective manner by persons qualified to 
do so, using procedures generally accepted in the profession to yield 
accurate and reliable results.
III.
    It is further ordered that respondent. Louis Bass, Inc. (d/b/a 
Crestwood Company), a 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 manufacturing, labelling, advertising, promotion, offering for 
sale, sale, or distribution of any communication aid, in or affecting 
commerce, as ``commerce'' is defined in the Federal Trade Commission 
Act, do forthwith cease and desist from representing, in any manner, 
directly or by implication, the performance or attributes of any such 
product, unless, at the time of making such representation, respondent 
possesses and relies upon competent and reliable evidence, which when 
appropriate must be competent and reliable scientific evidence, that 
substantiates such representation.
    It is further ordered that for five (5) years after the last date 
of dissemination of any representation covered by this Order, 
respondent, or its successors and assigns, shall maintain and upon 
request make available to the Federal Trade Commission for inspection 
and copying:
    A. All materials that were relied upon in disseminating such 
representation; and
    B. All tests, reports, studies, surveys, demonstrations or other 
evidence in its possession or control that contradict, qualify, or call 
into question such representation, or the basis relied upon for such 
representation, including complaints from consumers.
V.
    It is further ordered that respondent shall notify the Commission 
at least thirty (30) days prior to the effective date of any proposed 
change in the respondent that may affect compliance obligations under 
this Order such as dissolution, assignment, or sale resulting in the 
emergency of a successor corporation(s), the creation or dissolution of 
subsidiaries, or any other change in the corporation(s).
VI.
    It is further ordered that the corporate respondent shall, within 
sixty (60) days from the date of service of this Order upon it, 
distribute a copy of this Order to each of its officers, agents, 
representatives, licensees, independent contractors, and employees 
involved in the preparation and placement of advertisements or 
promotional materials, or is in communication with customers or 
prospective customers, or who has any responsibilities with respect to 
the subject matter of this Order; and for a period of three (3) years, 
from the date of issuance of this Order, distribute a copy of this 
Order to all of respondent's future such officers, agents, 
representatives, licensees, independent contractors, and employees.
VII.
    It is further ordered that respondent shall, within sixty (60) days 
from the date of service of this Order upon it, and at such other times 
as the Commission may require, file with the Commission a report, in 
writing, setting forth in detail the manner and form 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, subject to 
final approval, to a proposed consent order from respondent Louis Bass, 
Inc., d/b/a Crestwood Company, a Wisconsin corporation.
    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.
    This matter concerns the advertising of the ``Crestalk'' and the 
``Canon Communicator,'' communication aids for individuals with 
disabilities. The Commission's complaint charges that respondent's 
advertising contained false and unsubstantiated representations 
concerning the efficacy of these communication aids in enabling 
autistic individuals to communicate through facilitated communication. 
Facilitated communication is a technique that, among other things, 
entails an individual providing physical support to a person with a 
communication impairment, while that person types or points to a 
communication aid, such as the Crestalk or the Canon Communicator.
    Specifically, the complaint alleges that respondent falsely 
represented that the Crestalk and the Canon [[Page 469]] Communicator 
enable autistic individuals to communicate through facilitated 
communication. The complaint also alleges that respondent lacked 
substantiation for these claims.
    The proposed consent order contains provisions designed to remedy 
the violations charged and to prevent the respondent from engaging in 
similar acts and practices in the future.
    Part I of the proposed order prohibits respondent from 
misrepresenting that any communication aid enable autistic individuals 
to communicate through facilitated communication.
    As fencing-in relief, Part II of the proposed order provides that, 
if the respondent represents that a communication aid enables 
individuals with disabilities to communicate through facilitated 
communication, the representation must be true and respondent must 
possess competent and reliable scientific evidence that substantiates 
the representation. In addition, Part II of the proposed order 
prohibits respondent from representing the performance or attributes of 
a communication aid unless it possesses and relies upon competent and 
reliable evidence, which when appropriate must be competent and 
reliable scientific evidence, to substantiate the representation.
    The proposed order also requires respondent to maintain materials 
relied upon to substantiate claims covered by the order; to provide a 
copy of the consent agreement to its employees involved in the 
preparation and placement of respondent's advertisements, or in 
communication with respondent's customers or prospective customers; to 
notify the Commission of any change in the corporate structure that 
might affect compliance with the order; and to file one or more reports 
detailing compliance 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.
Benjamin I. Berman,
Acting Secretary.
[FR Doc. 95-94 Filed 1-3-95: 8:45 am]
BILLING CODE 6750-01-M