[Federal Register Volume 67, Number 68 (Tuesday, April 9, 2002)]
[Notices]
[Pages 17071-17072]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-8492]


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FEDERAL TRADE COMMISSION

[File No. 012 3060]


Kryton Coatings International, Inc., et al.; Analysis To Aid 
Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed consent agreement.

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SUMMARY: The consent agreement in this matter settles alleged 
violations of federal law prohibiting unfair or deceptive acts or 
practices or unfair methods of competition. The attached Analysis to 
Aid Public Comment describes both the allegations in the draft 
complaint that accompanies the consent agreement and the terms of the 
consent order--embodied in the consent agreement--that would settle 
these allegations.

DATES: Comments must be received on or before May 1, 2002.

ADDRESSES: Comments filed in paper form should be directed to: FTC/
Office of the Secretary, Room 159-H, 600 Pennsylvania Avenue, NW., 
Washington, DC 20580. Comments filed in electronic form should be 
directed to: [email protected] as prescribed below.

FOR FURTHER INFORMATION CONTACT: Hampton Newsome or Joni Lupovitz, 
Bureau of Consumer Protection, 600 Pennsylvania Avenue, NW., 
Washington, DC. 20580, (202) 326-2889 or 326-3743.

SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal 
Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46(f), 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 thirty (30)

[[Page 17072]]

days. The following Analysis to Aid Public Comment describes the terms 
of the consent agreement, and the allegations in the complaint. An 
electronic copy of the full text of the consent agreement package can 
be obtained from the FTC Home Page (for April 3, 2002), on the World 
Wide Web, at ``http://www.ftc.gov/os/2002/04/index.htm.'' A paper copy 
can be obtained from the FTC Public Reference Room, Room 130-H, 600 
Pennsylvania Avenue, NW., Washington, DC 20580, either in person or by 
calling (202) 326-2222.
    Public comments are invited, and may be filed with the Commission 
in either paper or electronic form. Comments filed in paper form should 
be directed to: FTC/Office of the Secretary, Room 159-H, 600 
Pennsylvania Avenue, NW., Washington, DC 20580. If a comment contains 
nonpublic information, it must be filed in paper form, and the first 
page of the document must be clearly labeled ``confidential.'' Comments 
that do not contain any nonpublic information may instead be filed in 
electronic form (in ASCII format, WordPerfect, or Microsoft Word) as 
part of or as an attachment to email messages directed to the following 
email box: [email protected]. Such comments 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, subject to final 
approval, an agreement for entry of a proposed consent order from 
Kryton Coatings International, Inc. and Procraft, Inc. 
(``respondents''). The agreement would settle a proposed complaint by 
the Federal Trade Commission that respondents engaged in unfair or 
deceptive acts or practices in violation of Section 5(a) of the Federal 
Trade Commission Act.
    The proposed consent order has been placed on the public record for 
thirty (30) days for reception of comments by interested persons. 
Comments received during this period will become part of the public 
record. After thirty (30) days, the Commission will again review the 
agreement and the comments received and will decide whether it should 
withdraw from the agreement or make final the agreement's proposed 
order.
    This matter concerns advertising representations made about 
``Multi-Gard'' (also known as Liquid Siding, Liquid Vinyl, or Multi-
Gard R-20), a residential coating product. The proposed administrative 
complaint alleges that respondents violated the FTC Act by 
disseminating ads that made unsubstantiated performance claims about 
Multi-Gard. The proposed complaint further alleges that respondents 
represented that Multi-Gard: (1) Provides insulation equivalent to 
seven inches of fiberglass batting; (2) provides an insulation value of 
R-20; (3) reduces energy loss, energy costs or utility bills by up to 
40%; and (4) performs the same insulation function as the ultra-thin 
ceramic technology on the space shuttle. The proposed complaint alleges 
that respondents represented that they had a reasonable basis for these 
claims. The proposed compliant further alleges that, although the use 
of Multi-Gard and caulking (which is provided as part of the 
application service for Multi-Gard) may seal air leaks and cracks in 
buildings and, as a result, may reduce energy costs in some cases, 
respondents did not posses and rely upon a reasonable basis that 
substantiated their claims.
    The proposed consent order contains provisions designed to prevent 
respondents from engaging in similar acts and practices in the future. 
Part I of the order prohibits respondents from making any 
representation about the benefits, performance or efficacy of any 
Liquid Siding, Multi-Gard, Multi-Gard R-20, Liquid Vinyl, or any other 
liquid siding or coating product, including: that such product reduces 
energy loss, energy costs, energy consumption, or utility bills; any R-
value associated with such product; or such product's insulation 
qualities as compared to any other materials, including insulation 
materials, unless, at the time of making such representation, 
respondents possess and rely upon competent and reliable scientific 
evidence that substantiates the representation.
    Part IV requires respondents to notify Multi-Gard distributors and 
wholesalers about this action and send them a copy of the consent 
order. The form of the notice is provided in Attachment A to the order. 
The remainder of the proposed order contains provisions regarding 
record-keeping, distribution of the order, notification of changes in 
corporate status, the filing of a compliance report, and termination of 
the order.
    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 the proposed order or to modify 
their terms in any way.

    By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. 02-8492 Filed 4-8-02; 8:45 am]
BILLING CODE 6750-01-M