[Federal Register Volume 84, Number 94 (Wednesday, May 15, 2019)]
[Notices]
[Pages 21781-21782]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-09953]


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FEDERAL TRADE COMMISSION

[File No. 182 3085]


National Floors Direct, Inc.; Analysis To Aid Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed consent agreement; request for comment.

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SUMMARY: The consent agreement in this matter settles alleged 
violations of federal law prohibiting unfair or deceptive acts or 
practices. The attached Analysis to Aid Public Comment describes both 
the allegations in the 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 June 14, 2019.

ADDRESSES: Interested parties may file comments online or on paper, by 
following the instructions in the Request for Comment part of the 
SUPPLEMENTARY INFORMATION section below. Write: ``National Floors 
Direct; File No. 182 3085'' on your comment, and file your comment 
online at https://www.regulations.gov 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: Carl H. Settlemyer (202-326-2019), 
Bureau of Consumer Protection, Federal Trade Commission, 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 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) 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 May 8, 2019), on the World Wide Web, at 
https://www.ftc.gov/news-events/commission-actions.
    You can file a comment online or on paper. For the Commission to 
consider your comment, we must receive it on or before June 14, 2019. 
Write ``National Floors Direct; File No. 182 3085'' 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 https://www.regulations.gov website.
    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 through the https://www.regulations.gov website.
    If you prefer to file your comment on paper, write ``National 
Floors Direct; File No. 182 3085'' 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.
    Because your comment will be placed on the publicly accessible 
website at https://www.regulations.gov, you are solely responsible for 
making sure that your comment does not include any sensitive or 
confidential information. In particular, your comment should not 
include any sensitive personal information, such as your or anyone 
else's Social Security number; date of

[[Page 21782]]

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 
information, such as medical records or other individually identifiable 
health information. In addition, your comment should not include any 
``trade secret or any commercial or financial information which . . . 
is privileged or confidential''--as provided by 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)--
including in particular competitively sensitive information such as 
costs, sales statistics, inventories, formulas, patterns, devices, 
manufacturing processes, or customer names.
    Comments containing material for which confidential treatment is 
requested must be filed in paper form, must be clearly labeled 
``Confidential,'' and must comply with FTC Rule 4.9(c). 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). Your comment will be kept 
confidential only if the General Counsel grants your request in 
accordance with the law and the public interest. Once your comment has 
been posted on the public FTC website--as legally required by FTC Rule 
4.9(b)--we cannot redact or remove your comment from the FTC website, 
unless you submit a confidentiality request that meets the requirements 
for such treatment under FTC Rule 4.9(c), and the General Counsel 
grants that request.
    Visit the FTC website 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 June 14, 2019. For information on the 
Commission's privacy policy, including routine uses permitted by the 
Privacy Act, see https://www.ftc.gov/site-information/privacy-policy.

Analysis of Proposed Consent Order To Aid Public Comment

    The Federal Trade Commission (``Commission'') has accepted, subject 
to final approval, an agreement containing a consent order as to 
National Floors Direct, Inc. (``respondent'').
    The proposed consent order (``order'') has been placed on the 
public record for 30 days for receipt of comments by interested 
persons. Comments received during this period will become part of the 
public record. After 30 days, the Commission will again review the 
order and the comments received, and will decide whether it should 
withdraw the order or make it final.
    This matter involves the respondent's use of non-disparagement 
provisions in consumer form contracts in its sale and installation of 
flooring and carpeting. The complaint alleges that the respondent 
violated Section 2(c) of the Consumer Review Fairness Act (``CRFA'') by 
offering to consumers form contracts that contained a non-disparagement 
provision made void by Section 2(b) of the CRFA. The CRFA defines a 
form contract as a contract with standardized terms, used in the course 
of selling or leasing goods or services, and imposed on an individual 
without a meaningful opportunity for such individual to negotiate the 
standardized terms.
    The order includes injunctive relief that prohibits these alleged 
violations and fences in similar and related conduct involving the use 
of contract terms that prohibit, restrict, penalize, or transfer rights 
in consumer reviews or evaluation of the respondent, its goods, or its 
services. The CRFA authorizes the Commission to seek civil penalties 
for knowing violations, but the complaint does not allege that the 
respondent's violations were knowing, and the order does not provide 
for monetary relief.
    Part I prohibits, in the sale or leasing of any good or service, 
the respondent from: Offering to any prospective customer a contract, 
or offering to any customer a renewal contract, that includes a review-
limiting term; requiring that a customer accept such a term as a 
condition of the respondent's fulfillment of its obligations under 
contracts entered into before the effective date of the order; or 
attempting to enforce or assert the validity of such a term in a 
customer contract entered into before the effective date of the order. 
Part I would not require that the respondent publish or host the 
content of any person, affect any other legal duty of a party to a 
contract, or affect any cause of action arising from the breach of such 
duty.
    Part II requires the respondent to notify by mail or email 
customers with whom it entered into form contracts with a non-
disparagement provision on or after March 14, 2017 that the non-
disparagement provision is void and cannot be enforced, and that those 
customers can publish their honest reviews about the respondent, even 
if their comments are negative.
    Part III requires the respondent to submit signed acknowledgments 
that relevant personnel received the order.
    Part IV requires the respondent to file compliance reports with the 
Commission, and to notify the Commission of bankruptcy filings or 
changes in corporate structure that might affect compliance 
obligations.
    Part V contains recordkeeping requirements for personnel records, 
consumer contracts, communications with consumers threatening any legal 
action relating to any review; and court filings and the company's 
discovery responses in legal actions over consumer reviews, as well as 
all records necessary to demonstrate compliance or non-compliance with 
the order.
    Part VI contains other requirements related to the Commission's 
monitoring of the respondent's order compliance.
    Part VII provides the effective dates of the order, including that, 
with exceptions, the order will terminate in 20 years.
    The purpose of this analysis is to facilitate public comment on the 
order, and it is not intended to constitute an official interpretation 
of the complaint or order, or to modify the order's terms in any way.

    By direction of the Commission.
April J. Tabor,
Acting Secretary.
[FR Doc. 2019-09953 Filed 5-14-19; 8:45 am]
BILLING CODE 6750-01-P