[Federal Register Volume 62, Number 34 (Thursday, February 20, 1997)]
[Notices]
[Pages 7786-7787]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-4146]
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FEDERAL TRADE COMMISSION
[File No. 962-3118]
Zale Corporation; Analysis to Aid Public Comment
AGENCY: Federal Trade Commission.
ACTION: Proposed consent agreement.
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SUMMARY: In settlement of alleged violation 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 require, among other things, the Irving,
Texas-based jewelry retailer to disclose, clearly and prominently, the
nature of the pearl jewelry it sells and would mandate that company
stores display consumer information about the definition of natural,
cultured, imitation pearls. The complaint accompanying the consent
agreement alleges that Zale deceptively advertised its ``Ocean
Treasures'' line of limitation pearl jewelry as composed of cultured
pearls.
DATES: Comments must be received on or before April 21, 1997.
ADDRESSES: Comments should be directed to: FTC/Office of the Secretary,
Room 159, 6th St. and Pa. Ave., N.W., Washington, D.C. 20580.
FOR FURTHER INFORMATION CONTACT: Jeffrey Klurfeld, Federal Trade
Commission, San Francisco Regional Office, 901 Market Street, Suite
570, San Francisco, CA 94103. (415) 356-5275.
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
Commission Actions section of the FTC Home Page (for February 10,
1997), 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, either in person or by calling (202) 326-3627. 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, subject to
final approval, to a proposed consent order from Zale Corporation,
(hereinafter ``Zale''). Zale is the largest retailer of fine jewelry
products in the United States.
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 any 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.
The proposed complaint alleges violations of Section 5 of the
Federal Trade Commission Act. This matter focused on Zale's
advertisements for the ``Ocean Treasures'' line of imitation pearl
jewelry. The advertisements depicted Ocean Treasures earrings,
necklaces, rings and pendants, and described them as follows: ``Ocean
Treasures Fine Jewelry. Created by nature, enhanced by man.'' The
advertisements also included the following statement: ``Zales. The
Diamond, semi-precious and pearl store.'' The proposed complaint
alleges that, through these depictions and statements, Zale violated
Section 5 of the Federal Trade Commission Act by falsely claiming that
the Ocean Treasures line of jewelry is composed of cultured pearls.
The Federal Trade Commission recently revised its Guides for the
Jewelry, Precious Metals, and Pewter Industries, 16 C.F.R. Part 23, 61
F.R. 27212 (May 30, 1996) (the ``Jewelry Guides''). The previous
version of the Guides as well as the revised Guides address various
advertising practices in the jewelry industry, including those employed
by Zale. See, e.g., Sec. 23.2 (Misleading Illustrations); Sec. 23.20
(Misuse of terms such as ``cultured pearl,'' ``seed pearl,'' ``Oriental
pearl,'' ``natura,'' ``kultured,'' ``real,'' ``gem,'' ``synthetic,''
and regional designations); Sec. 23.19 (Misuse of the word ``pearl'');
and Sec. 23.18 (Definitions of various pearls). These industry guides
are administrative interpretations of laws administered by the
Commission for the guidance of the public in conducting its affairs in
conformity with legal requirements. While the Guides are referenced in
the complaint, they do not create a separate cause of action.
Part I of the proposed order would require that Zale not represent
that imitation pearls are cultured pearls. Part II would prevent Zale
from representing that imitation pearl jewelry is or contains one or
more pearls unless Zale designates the jewelry as ``artificial,''
``imitation,'' ``simulated,'' or by some other word or phrase of like
meaning. Part III would prevent Zale from representing that cultured
pearl jewelry is or contains one or more pearls unless Zale designates
the jewelry as ``cultured'' or ``cultivated,'' or by some other word or
phrase of like meaning. Part IV would prohibit the company from
misrepresenting the composition or origin of any jewelry product
composed partially or entirely of natural pearls, cultured pearls, or
imitation pearls.
Part V of the proposed order would require Zale, for a period of
three years, to make available, at each of its stores that sells
natural, cultured or imitation pearls, a brief fact sheet entitled
``Your Guide to Pearls.'' This fact sheet briefly defines the
differences among the three general categories of pearls.
The proposed order also would require Zale to maintain materials
related to its advertising of pearl, cultured pearl, and imitation
pearl jewelry. The proposed order would also require Zale to provide a
copy of the consent agreement to all employees or representatives with
duties affecting compliance with the terms of the order; 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, and it is not intended to constitute an official
interpretation of
[[Page 7787]]
the agreement and proposed order, or to modify in any way their terms.
Donald S. Clark,
Secretary.
[FR Doc. 97-4146 Filed 2-19-97; 8:45 am]
BILLING CODE 6750-01-M
