[Federal Register Volume 60, Number 208 (Friday, October 27, 1995)]
[Notices]
[Pages 55033-55035]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-26679]
-----------------------------------------------------------------------
FEDERAL TRADE COMMISSION
[File No. 943-3277]
Johnson & Johnson Consumer Products Inc.; Consent Agreement With
Analysis To Aid Public Comment
AGENCY: Federal Trade Commission.
ACTION: Consent agreement.
-----------------------------------------------------------------------
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, among other things, prohibit a New Jersey-based consumer
products company and its parents corporation (1) from representing, in
any manner, directly or by implication, the efficacy of any over-the-
counter product--as a contraceptive or as a method of protection
against the transmission of any sexually-transmitted disease--unless,
at the time of making any such representation, the companies possess
and rely upon competent and reliable scientific evidence that
substantiates such representation; and (2) from misrepresenting in any
manner, directly or by implication, the existence, contents, validity,
results, conclusions, or interpretations of any test or study relating
to any over-the-counter product with a use relating to human
reproduction, reproductive organs or sexually-transmitted diseases.
DATES: Comments must be received on or before December 26, 1995.
ADDRESSES: Comments should be directed to: FTC/Office of the Secretary,
Room 159, 6th Street and Pennsylvania Avenue, NW, Washington, DC.
20580.
FOR FURTHER INFORMATION CONTACT:
Linda K. Badger, San Francisco Regional Office, 901 Market Street,
Suite 570, San Francisco, California 94103. (415) 356-5270.
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 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 Section 4.9(b)(6)(ii) of the Commission's Rules of
Practice (16 CFR 4.9(b)(6)(ii)).
The Federal Trade Commission having initiated an investigation of
certain acts and practices of Johnson & Johnson Consumer Products,
Inc., a corporation, and it now appearing that the proposed respondent
and its parent corporation, Johnson & Johnson, 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 Johnson & Johnson Consumer
Products, Inc., a corporation, by its duly authorized officer, and its
attorney, and its parent corporation, Johnson & Johnson, and its duly
authorized officer, and its attorney, and counsel for the Federal Trade
Commission that:
1. Proposed respondent Johnson & Johnson Consumer Products, Inc.,
is a corporation organized, existing and doing business under and by
virtue of the laws of the State of New Jersey, with its office and
principal place of business located at 1999 Grandview Road, Skillman,
New Jersey 08588.
Johnson & Johnson is a corporation organized, existing and doing
business under and by virtue of the laws of the State of New Jersey,
with its office and principal place of business located at One Johnson
& Johnson Plaza, New Brunswick, New Jersey 08933.
2. Proposed respondent and its parent corporation admit all the
jurisdictional facts set forth in the draft of complaint.
3. Proposed respondent and its parent corporation 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;
c. All rights to seek judicial review or otherwise to challenge or
contest the validity of the order entered pursuant to this agreement;
and
d. Any claim under the Equal Access to Justice Act.
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 respondent and its parent
corporation, 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 the proposed respondent or its parent
corporation of facts, other than jurisdictional facts, or of violations
of law as alleged in the draft of 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 Section 2.34 of the
Commission's Rules, the Commission may, without further notice to the
proposed respondent or its parent corporation, (a) issue its complaint
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 the proposed respondent's address and to its parent
corporation's address as stated in this agreement shall constitute
service. The proposed respondent and its parent corporation 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. The proposed respondent and its parent corporation have read the
proposed complaint and order contemplated hereby. The proposed
respondent and its parent corporation 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. The
proposed respondent and its parent corporation further understand
[[Page 55034]]
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
I
It is ordered that respondent, Johnson & Johnson Consumer Products,
Inc., a corporation, its parent corporation, Johnson & Johnson, and all
the other subsidiaries of Johnson & Johnson, their successors and
assigns (hereinafter collectively ``the companies''), and the
companies' officers, 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 K-Y Plus Nonoxynol-9
Spermicidal Lubricant, or any other personal lubricant and/or
spermicide, in or affecting commerce, as ``commerce'' is defined in the
Federal Trade Commission Act, do forthwith cease and desist from making
any representation, directly or by implication, relating to:
A. The failure rate of any method of contraception due to defects,
misuse, or any other cause;
B. Any such product's ability to provide protection against the
development of tiny holes in condoms during use;
C. Any such product's ability to provide protection against HIV and
other viruses; or
D. The health-related benefits of any such product; unless, at the
time of making any such representation, the companies possess and rely
upon competent and reliable scientific evidence that substantiates such
representation. For the purposes of this Order, ``competent and
reliable scientific evidence'' shall mean those tests, analyses,
research, studies or other evidence based on the expertise of
professionals in the relevant area, that have 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.
II
It is further ordered that the companies and their officers,
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 ``food,'' ``drug'' or ``device,'' as
those terms are defined in Section 15 of the Federal Trade Commission
Act, 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
of any over-the-counter product as a contraceptive or as a method of
protection against the transmission of any sexually-transmitted
disease, unless, at the time of making any such representation, the
companies possess and rely upon competent and reliable scientific
evidence that substantiates such representation.
III
It is further ordered that the companies and their officers,
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 over-the-counter product with a use
relating to human reproduction, reproductive organs or sexually-
transmitted diseases, in or affecting commerce, as ```commerce'' is
defined in the Federal Trade Commission, Act, do forthwith cease and
desist from misrepresenting in any manner, directly or by implication,
the existence, contents, validity, results, conclusions, or
interpretations of any test or study.
IV
It is further ordered that for five (5) years after the last date
of dissemination of any representation covered by this Order, the
companies 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 the companies notify the Commission at
least thirty (30) days prior to any proposed change in the companies
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 corporation which may affect compliance
obligations arising out of the Order.
VI
It is further ordered (1) that respondent Johnson & Johnson
Consumer Products, Inc., shall, within ten (10) days from the date of
service of this Order upon it, distribute a copy of this Order to each
of its operating divisions, to each of its managerial employees, and to
each of its officers, agents, representatives or employees engaged in
the preparation, review or placement of advertising or other materials
covered by this Order, and (2) that the parent corporation, Johnson &
Johnson, shall, within ten (10) days from the date of service of this
Order upon it, distribute a copy of this Order to each of its and of
its subsidiaries' officers, agents, representatives or employees
engaged in the preparation, review of placement of advertising of any
over-the-counter product with a use relating to human reproduction,
reproductive organs or sexually-transmitted diseases.
VII
It is further ordered that this Order will terminate twenty years
from the date of its issuance, or twenty years from the most recent
date that the United States or the Federal Trade Commission files a
complaint (with or without an accompanying consent decree) in federal
court alleging any violation of the Order, whichever comes later;
provided, however, that the filing of such complaint will not affect
the duration of:
A. Any paragraph in this Order that terminates in less than twenty
years;
B. This Order's application to any respondent that is not named as
a defendant in such complaint; and
C. This Order if such complaint is filed after the Order has
terminated pursuant to this paragraph.
Provided further, that if such complaint is dismissed or a federal
court rules that the respondent did not violate any provision of the
Order, and the dismissal or ruling is either not appealed or upheld on
appeal, then the Order will terminate according to this paragraph as
though the complaint was never filed, except that the Order will not
terminate between the date such complaint is filed and the later of the
deadline for appealing such dismissal or ruling and the date such
dismissal or ruling is upheld on appeal.
VIII
It is further ordered that the companies shall, within sixty (60)
days from the date of service of this Order upon them, and at such
other times as the Commission may require, file with
[[Page 55035]]
the Commission a report, in writing, setting forth in detail in the
manner and form in which they have complied with this Order.
IX
It is further ordered that nothing in this Order shall prohibit the
companies from making any representation for any drug that is permitted
in labeling for any such drug under any tentative final or final
standard promulgated by the Food and Drug Administration, or under any
new drug application approved by the Food and Drug Administration.
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 respondent Johnson &
Johnson Consumer Products, Inc. Its parent corporation, Johnson and
Johnson, although not a respondent, also agreed to be bound by the
terms of the consent order. Both parent and subsidiary are New Jersey
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.
Johnson & Johnson Consumer Products, Inc., manufacturers and sells
baby care products, personal care products for adults, and bandages.
This matter concerns this company's ``Condom Insurance'' advertisements
for its ``K-Y Plus Brand Spermicidal Lubricant with NonOxynol-9'' (``K-
Y Plus''). In these advertisements, Johnson & Johnson CPI promote the
use of K-Y Plus with condoms as ``insurance'' to protect against
unwanted pregnancies, and HIV and other sexually transmitted diseases
(``STDs'') in case of condom failure. The ads warn consumers to use K-Y
Plus because one in six condoms allegedly fails.
The Commission's complaint charges that respondent's advertising
contained false and/or unsubstantiated representations regarding the
failure rate of condoms and the effectiveness of K-Y Plus.
Specifically, the complaint alleges that the respondent falsely
represented that scientific tests or studies show that up to eighteen
and one half percent of condoms will fail, leaving users vulnerable to
pregnancy and sexually transmitted diseases. The complaint also alleges
that the respondent made unsubstantiated claims that: (1) One out of
six condoms develops tiny holes during use which are big enough for
sperm, HIV and other viruses to pass through; (2) one out of six
condoms fails due to mistake in using condoms or through the
development of tiny holes during use; (3) K-Y Plus provides protection
against the development of tiny holes in condoms during use; and (4) K-
Y Plus provides protection against HIV and other viruses.
The proposed consent order contains provisions designed to remedy
the violations charged and to prevent the respondent or its parent
corporation from engaging in similar acts and practices in the future.
Part I of the proposed order would prohibit the companies from making
any of the unsubstantiated claims delineated above, or any other claims
of a health-related benefit, for K-Y Plus or any other spermicide and/
or lubricant, unless at the time of making them, they possess and rely
upon competent and reliable evidence, which when appropriate must be
competent and reliable scientific evidence.
Part II of the proposed order includes fencing-in relief,
prohibiting the companies from representing, in any manner, directly or
by implication, the efficacy of any over-the-counter product as a
contraceptive or as a method of protection against the transmission of
any sexually-transmitted disease, unless, at the time of making any
such representation, the companies possess and rely upon competent and
reliable scientific evidence that substantiates such representation.
Part III of the proposed order prohibits the companies from
misrepresenting in any manner, directly or by implication, the
existence, contents, validity, results, conclusions, or interpretations
of any test or study relating to any over-the-counter product with a
use relating to human reproduction, reproductive organs or sexually-
transmitted diseases.
The proposed order also requires the companies to maintain
materials relied upon to substantiate claims covered by the order; to
provide a copy of the consent agreement to all employees or
representatives involved in the preparation and placement of the
company's advertisements, as well as to all company executives and
marketing and sales managers; to notify the Commission of any changes
in corporate structure that might affect compliance with the order; 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.
Concurring Statement of Commissioner Mary L. Azcuenaga in Johnson &
Johnson Consumer Protects Inc. File No. 943 3277
In concur in the acceptance of the proposed consent agreement for
public comment except to the extent that the proposed order imposes
obligations on Johnson & Johnson (the parent company of the respondent
Johnson & Johnson Consumer Products Inc.), which is not named in the
accompanying complaint.
[FR Doc. 95-26679 Filed 10-26-95; 8:45 am]
BILLING CODE 6750-01-M
