[Federal Register Volume 61, Number 196 (Tuesday, October 8, 1996)]
[Notices]
[Pages 52797-52798]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-25668]
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FEDERAL TRADE COMMISSION
[File No. 932-3297]
Telebrands Corp., Ajit Khubani; Analysis To Aid Public Comment
AGENCY: Federal Trade Commission.
ACTION: Consent agreement.
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SUMMARY: In settlement of alleged violations of federal law prohibiting
unfair or deceptive acts or practices and unfair methods of
competition, this consent agreement, accepted subject to final
Commission approval, would among other things prohibit the Roanoke,
Virginia-based mail and telephone order company--and an individual who
is an officer and director of the company--from representing that the
Sweda Power Antenna (a device purported to improve television and radio
reception) provides the best, crispest, clearest or most focused
television reception achievable without cable installation, and would
require any claim about the relative or absolute performance,
attributes, or effectiveness of any product intended to improve a
television's or radio's reception, sound, or image to be truthful and
supported by competent and reliable evidence. The consent agreement
would also prohibit the respondents from making a number of false or
unsubstantiated claims about the WhisperXL (a purportedly major
breakthrough in sound enhancement technology). The consent agreement
resolves allegations in an accompanying complaint that the respondents
made unsubstantiated and false claims in advertising for the Sweda
Power Antenna and the WhisperXL, and misrepresented a money-back
guarantee with respect to the Sweda Power Antenna. A related federal
district court decree will require the respondents to
[[Page 52798]]
pay a $95,000 civil penalty, and will prohibit them from violating the
Commission's Mail or Telephone Order Merchandise Rule.
DATES: Comments must be received on or before December 9, 1996.
ADDRESSES: Comments should be directed to: FTC/Office of the Secretary,
Room H-159, Sixth Street and Pennsylvania Avenue, N.W., Washington,
D.C. 20580.
FOR FURTHER INFORMATION CONTACT: Michael Bloom, New York Regional
Office, Federal Trade Commission, 150 William Street, 13th Floor, New
York, New York 10038-2603, (212) 264-1207. Donald G. D'Amato, New York
Regional Office, Federal Trade Commission, 150 William Street, 13th
Floor, New York New York 10038-2063, (212) 264-1223.
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 above-captioned 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. The following Analysis to Aid
Public Comment describes the terms of the consent agreement, and the
allegations in the accompanying complaint. An electronic copy of the
full text of the consent agreement package can be obtained from the FTC
Home page, on the World Wide Web, at ``http://www.ftc.gov/os/actions/
htm.'' A paper copy can be obtained from the FTC Public Reference Room,
Room H-130, Sixth Street and Pennsylvania Avenue, N.W., Washington,
D.C. 20580. 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)).
Analysis of Proposed Consent Order To Aid Public Comment
The Federal Trade Commission has accepted an agreement to a
proposed consent order from Telebrands Corp. (``Telebrands'') and Ajit
Khubani. Proposed respondents are marketers of varied products,
including the Sweda Power Antenna and the WhisperXL, which were
subjects of this investigation.
The proposed consent order has been placed on the public record for
sixty (60) days for the 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 comments received and will decide whether it should
withdraw from the agreement and take appropriate action or make final
the agreement's proposed order.
The Commission's complaint charges that the proposed respondents
made the following unsubstantiated and false representations about the
Sweda Power Antenna: (1) Sweda Power Antenna provides the best,
crispest, clearest, or most focused television reception achievable
without cable installation; (2) Sweda Power Antenna takes a television
or radio signal and electronically boosts it before it gets to a
television or radio; and (3) the installation of a Sweda Power Antenna
will more effectively improve television's or radio's reception, sound,
or image than the installation of a television or radio dish antenna.
Further, the complaint alleges that the proposed respondents failed
to timely honor their money back guarantee for the Sweda Power Antenna.
Part I of the proposed order prohibits proposed respondents from
representing that the Sweda Power Antenna provides the best, crispest,
clearest or most focused television reception achievable without cable
installation or will more effectively improve a television's or radio's
reception, sound, or image than the installation of a television or
satellite or external dish antenna.
Part II of the proposed order requires that any claim proposed
respondents make that the Sweda Power Antenna takes a television or
radio signal and electronically boosts it before it gets to a
television or radio be truthful and supported by competent and reliable
evidence. Similarly, Part III of the proposed order requires that any
claim about the relative or absolute performance, attributes, or
effectiveness of any product intended to improve a television's or
radio's reception, sound, or image be truthful and supported by
competent and reliable evidence.
Part IV of the proposed order prohibits the proposed respondents
from misrepresenting, by act or omission, any guarantee of satisfaction
or refund offer in connection with the advertising or sale of any
product, and requires the proposed respondents to make a full refund of
the purchase price, as well as any shipping, insurance, and handling
charges, within seven business days of receiving the consumer's request
for the guaranteed refund. The proposed order permits the respondents
to exclude fees, such as handling charges, paid by the consumer from
the terms of the guarantee of satisfaction or refund offer so long as
the exclusion is clear, conspicuous, and in close proximity to the
guarantee of satisfaction or refund offer.
With respect to the WhisperXL, the complaint charges that the
proposed respondents made the following unsubstantiated and false
representations about the WhisperXL: (1) WhisperXL is a major
breakthrough in sound enhancement technology; (2) WhisperXL is an
effective hearing aid; (3) WhisperXL is designed to produce or produces
clear amplification of whispered or normal speech, television, radio,
or other mid- to high-frequency sounds at a distance of more than a few
feet; (4) WhisperXL allows the user to hear a whisper from as far as
100 feet away; and (5) WhisperXL allows the user to hear a pin drop
from 50 feet away.
Part V of the proposed order prohibits the proposed respondents
from making these claims for the WhisperXL. Further, Part VI of the
proposed order requires that any claim respondents make about the
relative or absolute performance, attributes, or effectiveness of any
hearing aid be truthful and supported by competent and reliable
evidence.
The proposed order contains recordkeeping requirements for
materials that substantiate, qualify, or contradict claims covered by
the proposed order (Part VII), and requires the proposed respondents to
keep and maintain all records demonstrating compliance with the terms
and provisions of the order (Part VIII). Parts IX and X of the proposed
order require distribution of a copy of the order to current and future
officers and agents. Part XI provides for Commission notification upon
a change in the corporate respondent and Part XII requires Commission
notification when the individual respondent changes his present
business or employment.
Part XIII provides for the termination of the order after twenty
(20) years under certain circumstances. Part XIV obligates proposed
respondents to file compliance reports with the Commission.
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. 96-25668 Filed 10-7-96; 8:45 am]
BILLING CODE 6750-01-M