[Federal Register Volume 60, Number 128 (Wednesday, July 5, 1995)]
[Notices]
[Pages 35021-35023]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-16444]
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FEDERAL TRADE COMMISSION
[File No. 932-3112]
Alpine Industries, 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
prohibit, among other things, two Minnesota-based sister companies and
their principal officers from making unsubstantiated claims about the
ability of any air cleaning product to eliminate, remove, clear or
clean any indoor air pollutant--or any quantity of indoor air
pollutants--from a user's environment.
DATES: Comments must be received on or before September 5, 1995.
ADDRESSES: Comments should be directed to FTC/Office of the Secretary,
Room 159, 6th St. and Pa. Ave., NW, Washington, D.C. 20580.
FOR FURTHER INFORMATION CONTACT:
Jeffrey Klurfeld, Kerry O'Brien, and Linda Badger, San Francisco
Regional Office, Federal Trade Commission, 901 Market Street, 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 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
The Federal Trade Commission having initiated an investigation of
certain acts and practices of Alpine Industries, Inc. and Living Air
Corp., corporations, and William J. Converse individually and as an
officer of Alpine Industries, Inc. and Living Air Corp. (``proposed
respondents''), and it now appearing that proposed respondents are
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 proposed respondents, by their
duly authorized officers, and their attorney, and counsel for the
Federal Trade Commission that:
1. Proposed respondent Alpine Industries, Inc. is a corporation
organized, existing, and doing business under and by virtue of the laws
of the State of Tennessee, with its office and principal place of
business located at 9199 Central Avenue, NE., in the City of Blaine,
State of Minnesota.
Proposed respondent Living Air Corp. is a corporation organized,
existing, and doing business under and by virtue of the laws of the
State of Tennessee, with its office and principal place of business
located at 11673 Tulip Street, in the City of Coon Rapids, State of
Minnesota.
Proposed respondent William J. Converse is an officer of Alpine
Industries, Inc. and Living Air Corp. He formulates, directs, and
controls the policies, acts and practices of Alpine Industries, Inc.
and Living Air Corp. and his address is the same as that of Living Air
Corp.
2. Proposed respondents admit all the jurisdictional facts set
forth in the draft of complaint.
3. 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; 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 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 the proceeding.
5. This agreement is for settlement purposes only and does not
constitute an admission by proposed respondents of facts, other than
jurisdictional facts, or of violations of law as alleged in the draft
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 Sec. 2.34 of the Commission's
rules, the Commission may, without further notice to proposed
respondents, (a) issue its compliant 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
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 complied 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
For the purposes of this Order, the following definition shall
apply:
[[Page 35022]]
A. The term ``air cleaning product'' shall mean any products,
equipment, or appliance designed or advertised to remove, treat, or
reduce the level of any pollutant(s) in the air.
B. The terms ``indoor air pollutant(s)'' or ``pollutant(s)'' shall
mean one or more of the following: Formaldehyde, sulfur dioxide,
ammonia, trichlorethylene, benzene, chloroform, carbon tetrachloride,
odors, nitrogen dioxide, mold, mildew, bacteria, dust, cigarette smoke,
pollen, and hydrocarbons, or any other gaseous or particulate matter
found in indoor air.
C. The term ``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.
I
It is ordered that respondents Alpine Industries, Inc. and Living
Air Corp., corporations, their successors and assigns, and their
officers; William J. Converse, individually and as an officer of Alpine
Industries, Inc. and Living Air Corp.; and respondents' 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 air cleaning product 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,
A. Such product's ability to eliminate, remove, clear, or clean any
indoor air pollutant from a user's environment; or
B. Such product's ability to eliminate, remove, clear, or clean any
quantity of indoor air pollutants from a user's environment;
unless, at the time of making such representation, respondents posses
and rely upon competent and reliable scientific evidence that
substantiates the representation.
II
It is further ordered that respondents Alpine Industries, Inc. and
Living Air Corp., corporations, their successors and assigns, and their
officers; William J. Converse, individually and as an officer of Alpine
Industries, Inc. and Living Air Corp.; and respondent's 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 air cleaning product 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, that:
A. The use of ozone is more effective in cleaning or purifying
indoor air than other air cleaning methods;
B. The product does not create harmful by-products; or
C. When used as directed, the product prevents or provides relief
from any medical or health-related condition;
unless at the time of making such representation, respondents possess
and rely upon competent and reliable scientific evidence that
substantiates the representation.
III
It is further ordered that respondents Alpine Industries, Inc. and
Living Air Corp., corporations, their successors and assigns, and their
officers; William J. Converse, individually and as an officer of Alpine
Industries, Inc. and Living Air Corp.; and respondent's 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 air cleaning product 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 efficacy, performance, or health-
related benefit of any such product, unless, at the time of making such
representation, respondents possess and rely upon competent and
reliable evidence, which when appropriate must be competent and
reliable scientific evidence, that substantiates the representation.
IV
It is further ordered that for five (5) years after the last date
of dissemination of any representation covered by this Order,
respondents, or their 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 their 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 respondents shall notify the Commission
at least thirty (30) days prior to any proposed change in the corporate
respondents such as dissolution, assignment or sale resulting in the
emergence of a successor corporation, the creation or dissolution of
subsidiaries, or any other change in the corporations which may affect
compliance obligations arising out of this Order.
VI
It is further ordered that the individual respondent shall, for a
period of five (5) years after the date of service of this Order upon
him, promptly notify the Commission, in writing, of his discontinuance
of his present business or employment and of his affiliation with a new
business or employment. For each such new affiliation, the notice shall
include the name and address of the new business or employment, a
statement of the nature of the new business or employment, and a
description of respondent's duties and responsibilities in connection
with the new business or employment.
VII
It is further ordered that the corporate respondents shall, within
ten (10) days from the date of service of this Order upon them,
distribute a copy of this Order to each of their officers, agents,
representatives, independent contractors, and employees involved in the
preparation and placement of advertisements or promotional materials,
or who 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 respondents'
future such officers, agents, representatives, independent contractors,
and employees.
VIII
It is further ordered that the corporate respondents shall, within
ten (10) days from the date of service of this Order upon them, deliver
by first class mail or in person a copy of this Order or Attachment A
to each of their present distributors or retailers of their ozone
generators.
It is further ordered that respondents shall, within sixty (60)
days from the date of service of this order upon them, and at such
other times as the
[[Page 35023]]
Commission may require, file with the Commission a report, in writing,
setting forth in detail the manner and form in which they have complied
with this Order.
Attachment A
[To Be Printed on company letterhead]
[Date]
Dear [distributor]: Alpine Industries, Inc. and Living Air Corp.
recently settled a civil dispute with the Federal Trade Commission
(``FTC'') regarding certain claims for our product, the Living Air
Model XL15 ozone generator. As a part of the settlement, we are
required to make sure that our distributors and wholesalers stop
using or distributing advertisements or promotional materials
containing those claims.
We have entered into this agreement to resolve a dispute with
the FTC on certain claims it contends are not substantiated. The
agreement entered into is not an admission that we have violated the
law. However, as part of the agreement, we will not be making
certain claims unless they are supported by competent and reliable
scientific evidence.
Your assistance will be greatly appreciated in fulfilling the
terms of the agreement. We have agreed not to make the following
claims unless we have competent and reliable scientific evidence:
(1) That the product eliminates or clears indoor air pollutants; (2)
that the product creates no harmful by-products; (3) that the
product provides relief from specific medical or health-related
conditions; and (4) that the use of ozone is more effective in
cleaning or purifying indoor air than other air cleaning products
such as filters.
We ask each or our dealers, distributors, and sales managers to
cooperate with us to ensure that no current advertising or
promotional material makes these claims. Again, your assistance in
this regard will be greatly appreciated.
Sincerely,
William J. Converse,
President, Alpine Industries, Inc., and Living Air Corp.
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 respondents Alpine
Industries, Inc. and Living Air Corp., Tennessee corporations, and
William J. Converse, individually and as an officer of the
corporations.
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 ozone generators, including
the ``Living Air Model XL15,'' as air cleaning products for use in
homes, offices, and other commercial establishments. The Commission's
complaint charges that respondents' advertising contained
unsubstantiated representations concerning the efficacy of their ozone
generator in cleaning the air.
Specifically, the complaint alleges that the respondents lacked
substantiation for their claims that: (1) When used as directed, the
Living Air Model XL15 eliminates, removes, clears, or cleans
formaldehyde, sulfur dioxide, ammonia, trichlorethylene, benzene,
chloroform, carbon tetrachloride, odors, nitrogen dioxide, mold,
mildew, bacteria, dust, cigarette smoke, pollen, and hydrocarbons from
a user's environment; (2) the use of ozone is more effective in
cleaning or purifying indoor air than air cleaning products that use
filters; (3) the Living Air Model XL15 does not create harmful by-
products; and (4) when used as directed, the Living Air Model XL15
prevents or provides relief from colds, flu, allergies, asthma, sinus
headaches, and ear, eye, nose and throat infections.
The proposed consent order contains provisions designed to remedy
the violations charged and to prevent the respondents from engaging in
similar acts and practices in the future.
Part I of the proposed order prohibits respondents from
representing any air cleaning product's ability to eliminate, remove,
clear, or clean any indoor air pollutant or any quantity of indoor air
pollutants from a user's environment, unless respondents possess
competent and reliable scientific evidence that substantiates the
representation.
Similarly, Part II of the proposed order prohibits respondents from
claiming that (1) the use of ozone is more effective in cleaning or
purifying indoor air than other air cleaning methods, (2) any air
cleaning product does not create harmful by-products, or (3) when used
as directed, any air cleaning product prevents or provides relief from
any medical or health-related condition, unless respondents possess
competent and reliable scientific evidence that substantiates the
representation.
As fencing-in relief, Part III of the proposed order provides that
if respondents represent the efficacy, performance, or health-related
benefit of any air cleaning product, respondents must possess competent
and reliable evidence that substantiates the representation.
The proposed order also requires respondents to maintain materials
relied upon to substantiate claims covered by the order; to notify the
Commission of certain changes in the business or employment of the
named individual respondent; to provide a copy of the consent agreement
to their employees involved in the preparation and placement of
respondents' advertisements, or in communication with respondents'
customer or prospective customers; to distribute a copy of the order or
Attachment A of the consent agreement to their present distributors or
retailers of their ozone generators; 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.
Donald S. Clark,
Secretary.
[FR Doc. 95-16444 Filed 7-3-95; 8:45 am]
BILLING CODE 6750-01-M