[Federal Register Volume 79, Number 169 (Tuesday, September 2, 2014)]
[Notices]
[Pages 52008-52010]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2014-20747]


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FEDERAL TRADE COMMISSION

[File No. 131 0127]


National Association of Teachers of Singing, Inc.; 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 methods of competition. 
The attached Analysis to Aid Public Comment describes both the 
allegations in the draft complaint 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 September 22, 2014.

ADDRESSES: Interested parties may file a comment at https://ftcpublic.commentworks.com/ftc/natsconsent online or on paper, by 
following the instructions in the Request for Comment part of the 
SUPPLEMENTARY INFORMATION section below. Write ``National Association 
of Teachers of Singing, Inc.--Consent Agreement; File No. 131 0127'' on 
your comment and file your comment online at https://ftcpublic.commentworks.com/ftc/natsconsent by following the 
instructions on the web-based form. If you prefer to file your comment 
on paper, mail your comment to the following address: Federal Trade 
Commission, Office of the Secretary, 600 Pennsylvania Avenue NW., Suite 
CC-5610 (Annex D), Washington, DC 20580, or deliver your comment to the 
following address: Federal Trade Commission, Office of the Secretary, 
Constitution Center, 400 7th Street SW., 5th Floor, Suite 5610 (Annex 
D), Washington, DC 20024.

FOR FURTHER INFORMATION CONTACT: Karen Mills, Bureau of Competition, 
(202-326-2052), 600 Pennsylvania Avenue NW., Washington, DC 20580.

SUPPLEMENTARY INFORMATION: Pursuant to Section 6(f) of the Federal 
Trade Commission Act, 15 U.S.C. 46(f), and FTC Rule 2.34, 16 CFR 2.34, 
notice is hereby given that the above-captioned consent agreement 
containing 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) 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 August 22, 2014), on the World Wide Web, at 
http://www.ftc.gov/os/actions.shtm.
    You can file a comment online or on paper. For the Commission to 
consider your comment, we must receive it on or before September 22, 
2014. Write ``National Association of Teachers of Singing, Inc.--
Consent Agreement; File No. 131 0127'' on your comment. Your comment--
including your name and your state--will be placed on the public record 
of this proceeding, including, to the extent practicable, on the public 
Commission Web site, at http://www.ftc.gov/os/publiccomments.shtm. As a 
matter of discretion, the Commission tries to remove individuals' home 
contact information from comments before placing them on the Commission 
Web site.
    Because your comment will be made public, you are solely 
responsible for making sure that your comment does not include any 
sensitive personal information, like anyone's Social Security number, 
date of birth, driver's license number or other state identification 
number or foreign country equivalent, passport number, financial 
account number, or credit or debit card number. You are also solely 
responsible for making sure that your comment does not include any 
sensitive health

[[Page 52009]]

information, like medical records or other individually identifiable 
health information. In addition, do not include any ``[t]rade secret or 
any commercial or financial information which . . . is privileged or 
confidential,'' as discussed in Section 6(f) of the FTC Act, 15 U.S.C. 
46(f), and FTC Rule 4.10(a)(2), 16 CFR 4.10(a)(2). In particular, do 
not include competitively sensitive information such as costs, sales 
statistics, inventories, formulas, patterns, devices, manufacturing 
processes, or customer names.
    If you want the Commission to give your comment confidential 
treatment, you must file it in paper form, with a request for 
confidential treatment, and you have to follow the procedure explained 
in FTC Rule 4.9(c), 16 CFR 4.9(c).\1\ Your comment will be kept 
confidential only if the FTC General Counsel, in his or her sole 
discretion, grants your request in accordance with the law and the 
public interest.
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    \1\ In particular, the written request for confidential 
treatment that accompanies the comment must include the factual and 
legal basis for the request, and must identify the specific portions 
of the comment to be withheld from the public record. See FTC Rule 
4.9(c), 16 CFR 4.9(c).
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    Postal mail addressed to the Commission is subject to delay due to 
heightened security screening. As a result, we encourage you to submit 
your comments online. To make sure that the Commission considers your 
online comment, you must file it at https://ftcpublic.commentworks.com/ftc/natsconsent by following the instructions on the web-based form. If 
this Notice appears at http://www.regulations.gov/#!home, you also may 
file a comment through that Web site.
    If you file your comment on paper, write ``National Association of 
Teachers of Singing, Inc.--Consent Agreement; File No. 131 0127'' on 
your comment and on the envelope, and mail your comment to the 
following address: Federal Trade Commission, Office of the Secretary, 
600 Pennsylvania Avenue NW., Suite CC-5610 (Annex D), Washington, DC 
20580, or deliver your comment to the following address: Federal Trade 
Commission, Office of the Secretary, Constitution Center, 400 7th 
Street SW., 5th Floor, Suite 5610 (Annex D), Washington, DC 20024. If 
possible, submit your paper comment to the Commission by courier or 
overnight service.
    Visit the Commission Web site at http://www.ftc.gov to read this 
Notice and the news release describing it. The FTC Act and other laws 
that the Commission administers permit the collection of public 
comments to consider and use in this proceeding as appropriate. The 
Commission will consider all timely and responsive public comments that 
it receives on or before September 22, 2014. You can find more 
information, including routine uses permitted by the Privacy Act, in 
the Commission's privacy policy, at http://www.ftc.gov/ftc/privacy.htm.

Analysis of Agreement Containing Consent Order To Aid Public Comment

    The Federal Trade Commission (``Commission'') has accepted, subject 
to final approval, an Agreement Containing Consent Order (``Consent 
Agreement'') from the National Association of Teachers of Singing, Inc. 
(hereinafter ``NATS''). The Commission's complaint (``Complaint'') 
alleges that NATS, acting as a combination of its members and in 
agreement with at least some of its members, restrained competition 
among its members and others in violation of Section 5 of the Federal 
Trade Commission Act, as amended, 15 U.S.C. 45, by adopting and 
maintaining a provision in its Code of Ethics that restrains 
solicitation of teaching work.
    Under the terms of the proposed Consent Agreement, NATS is required 
to cease and desist from restricting solicitation among its members, 
and is required to disaffiliate any Chapter that adopts or maintains 
provisions in its code of ethics or similar documents that restrain 
solicitation, advertising, or price-related competition.
    The Commission anticipates that the competitive issues described in 
the Complaint will be resolved by accepting the proposed order, subject 
to final approval, contained in the Consent Agreement. The proposed 
Consent Agreement has been placed on the public record for 30 days for 
receipt of comments from interested members of the public. Comments 
received during this period will become part of the public record. 
After 30 days, the Commission will review the Consent Agreement again 
and the comments received, and will decide whether it should withdraw 
from the Consent Agreement or make final the accompanying Decision and 
Order (``the Proposed Order'').
    The purpose of this Analysis to Aid Public Comment is to invite and 
facilitate public comment. It is not intended to constitute an official 
interpretation of the proposed Consent Agreement and the accompanying 
Proposed Order or in any way to modify their terms.
    The Consent Agreement is for settlement purposes only and does not 
constitute an admission by NATS that the law has been violated as 
alleged in the Complaint or that the facts alleged in the Complaint, 
other than jurisdictional facts, are true.

I. The Complaint

    The Complaint makes the following allegations.
A. The Respondent
    NATS is a non-profit professional association of more than 7,300 
singing teachers. Many of NATS's members provide music-teaching 
services for a fee. Some also are employed at schools, universities and 
music studios as music teachers. NATS membership provides pecuniary 
benefits to its members.
    NATS has affiliated state and local chapters, which are grouped 
into 14 regions. Members of Chapters also are members of NATS.
    NATS maintains a Code of Ethics applicable to the commercial 
activities of its members, and requires its members to read and pledge 
adherence to all the provisions of the Code of Ethics. The NATS Bylaws 
require that Chapters shall abide by Association Bylaws, policies and 
guidelines, and will establish their own Bylaws and operating 
procedures consistent with the NATS Bylaws and with review and consent 
of the NATS Board of Directors.
    The NATS Code of Ethics has three sections. One of those sections 
is titled ``Ethical Standards Relating to Colleagues.'' That Section of 
the Code of Ethics includes a provision that states, ``Members will 
not, either by inducements, innuendos, or other accts, proselytize 
students of other teachers.''
    Some NATS Chapters have the same Code of Ethics that NATS has. Some 
Chapters have codes of ethics that contain other restrictions on 
solicitation, restrictions on price competition, restrictions on 
advertising free tuition, or restrictions on accepting pupils who have 
not fulfilled a financial obligation to another member until those 
obligations are satisfied.
B. The Anticompetitive Conduct
    The Complaint alleges that NATS violated Section 5 of the Federal 
Trade Commission Act by restraining competition among singing teachers 
through adoption and enforcement of the non-solicitation provision of 
its Code of Ethics. This is in effect an agreement among competitors 
not to compete. NATS requires members to agree to abide by the non-
solicitation provision. NATS adopted a complaint and enforcement 
procedure for the Code of Ethics that can result in termination of 
membership. When NATS members have complained that other members

[[Page 52010]]

violated the non-solicitation provision of the Code of Ethics, NATS has 
investigated complaints, and even where no formal action is taken, the 
NATS Ethics Committee, Executive Director, President, and Regions 
sometimes contact a teacher to secure compliance with the non-
solicitation provision of the Code of Ethics, or mediate between 
parties in order to resolve complaints.
    The Complaint alleges that the purpose, effect, tendency, or 
capacity of the combination, agreement, acts and practices of NATS has 
been and is to restrain competition unreasonably and to injure 
consumers by discouraging and restricting competition among music 
teachers.

II. The Proposed Order

    The Proposed Order has the following substantive provisions.
    Paragraph I contains definitions for terms used in the Order.
    Paragraph II requires NATS to cease and desist from restraining or 
declaring unethical the solicitation of teaching work. It also requires 
NATS to cease and desist from maintaining a relationship with any NATS 
Chapter that NATS learns or learns that, or obtains information that 
would lead a reasonable person to conclude that, engages in conduct 
that restrains solicitation, advertising, or price-related competition 
by its members.
    The Proposed Order does not prohibit NATS from adopting and 
enforcing reasonable principles (i) to prevent false or deceptive 
representations, or (ii) to govern the conduct of judges during singing 
competitions sponsored or held by NATS or its Chapters, or maintaining 
a relationship with a Chapter that adopts and enforces such principles. 
The Proposed Order does not prohibit restrictions on judges' 
solicitation during competitions because NATS could have a plausible 
efficiency rationale: Ensuring fair competitions. The Proposed Order's 
exemption is limited to restrictions on judges' behavior during 
competitions; prohibitions on judges' pre- or post-competition 
solicitation would violate the Proposed Order.
    Paragraph III requires NATS to remove from its organization 
documents and Web site any statement inconsistent with the Proposed 
Order, including the Code of Ethics restriction on solicitation. NATS 
also must publicize to its members, new members, Chapters, new 
Chapters, leaders, employees, and the public the changes NATS must make 
to the Code of Ethics, and a statement describing the Consent 
Agreement.
    Paragraph III also requires NATS to notify each of its Chapters 
that, as a condition of remaining a NATS Chapter, each Chapter must 
execute and return a Certification to NATS that the Chapter does not 
have restrictions on solicitation, advertising, or price-related 
competition. NATS must terminate any Chapter that does not provide an 
executed Certification within one hundred and twenty days of when NATS 
gave notice to the Chapter. Thereafter, if NATS learns that a Chapter 
has engaged in restraining or declaring unethical the solicitation, 
advertising, or price-related competition, the Proposed Order requires 
NATS to terminate the Chapter for one year unless the Chapter informs 
NATS that the Chapter has eliminated and will not reengage in such 
practices.
    Paragraph IV requires NATS to design, maintain, and operate an 
antitrust compliance program. NATS must appoint an Antitrust Compliance 
Officer for the duration of the Proposed Order. For a period of five 
years, NATS must provide guidance to its staff, employees, members, 
leaders, and Chapters concerning the antitrust laws and NATS' 
obligations under the Proposed Order. NATS also must implement policies 
and procedures to enable persons to ask questions about, and report 
violations of, the Proposed Order and the antitrust laws confidentially 
and without fear of retaliation, and to discipline its leaders, 
employees and agents for failure to comply with the Proposed Order.
    Paragraphs V-VII of the Proposed Order requires certain standard 
compliance reporting, cooperation, and access.
    The Proposed Order will expire in 20 years.

    By direction of the Commission.
Janice Podoll Frankle,
Acting Secretary.
[FR Doc. 2014-20747 Filed 8-29-14; 8:45 am]
BILLING CODE 6750-01-P