[Federal Register Volume 61, Number 76 (Thursday, April 18, 1996)]
[Notices]
[Pages 16922-16924]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-9553]
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FEDERAL TRADE COMMISSION
[File No. 952-3336]
Young & Rubicam, Inc.; Proposed Consent Agreement With Analysis
To Aid Public Comment
AGENCY: Federal Trade Commission.
ACTION: Proposed consent agreement.
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SUMMARY: In settlement of alleged violations 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 prohibit, among other things, the New York
City-based advertising agency from making broad pollution-removal
claims for Ford Motor Company's MicronAir Filtration System, and
substantially similar cabin air filtration system, or any household air
filtration system. The Consent Agreement settles allegations that Young
& Rubicam, in their advertising campaigns for several 1995 models of
Ford automobiles, made false claims about the extent to which the
MicronAir Filtration System can remove air pollutants in automobile
passenger cabins.
DATES: Comments must be received on or before June 17, 1996.
ADDRESSES: Comments should be directed to: FTC/Office of the Secretary,
Room 159, 6th St. and Pa. Ave. NW., Washington, D.C. 20580.
FOR FURTHER INFORMATION CONTACT:
Linda K. Badger, Federal Trade Commission, San Francisco Regional
Office, 901 Market Street, Suite 570, San Francisco, CA 94103, (415)
356-5270;
Jeffrey Klurfeld, Federal Trade Commission, San Francisco Regional
Office, 901 Market Street, Suite 570, San Francisco, CA 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)).
In the Matter of: Young & Rubicam Inc., a corporation; File No.
952-3336.
Agreement Containing Consent Order To Cease and Desist
The Federal Trade Commission having initiated an investigation of
certain acts and practices of Young & Rubicam Inc. (``Young &
Rubicam''), a corporation, and it now appearing that the proposed
respondent is 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 Young & Rubicam, a corporation,
by its duly authorized officer, and its attorney, and counsel for the
Federal Trade Commission that:
1. Proposed respondent Young & Rubicam is a corporation organized,
existing and doing business under and by virtue of the laws of the
State of New York, with its office and principal place of business
located at 285 Madison Avenue, New York, New York 10017.
2. Proposed respondent admits all the jurisdictional facts set
forth in the draft of complaint.
3. Proposed respondent waives:
a. Any further procedural steps;
b. The requirement that the Commission's decision contain a
statement of findings of fact and conclusions of law; and
c. All rights to seek judicial review or otherwise to challenge or
contest the validity of the order entered pursuant to this agreement.
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, 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 that the law has
been violated as alleged in the draft Complaint, or that the facts as
alleged in the draft Complaint, other than jurisdictional facts, are
true.
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
proposed respondent, (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 proposed
respondent's address as stated in this agreement shall constitute
service. The proposed respondent waives any right it 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 has read the proposed complaint and
order contemplated hereby. The proposed respondent understands that
once the order has been issued, it will be required to file one or more
compliance reports showing that it has fully complied with the order.
The proposed respondent further understands that it may be liable for
civil penalties in the amount provided by law for each violation of the
order after it becomes final.
[[Page 16923]]
Order
I
It is ordered that respondent, Young & Rubicam, a corporation, its
successors and assigns, and its officers, and respondent's agents,
representatives and employees, directly or through any corporation,
subsidiary, division or other device, in connection with the
advertising or promotion of the MicronAir Filtration System as
configured in the 1995 Lincoln Continental and the 1995 Mercury
Mystique or any substantially similar product 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, that such products remove virtually all pollutants. For
the purposes of this Order, ``substantially similar product'' shall
mean any automotive cabin air filter which is an electrostatic filter,
consisting of layers of non-woven fabric, with at least one layer that
has been electrically charged.
II
It is further ordered that respondent, Young & Rubicam, a
corporation, its successors and assigns, and its officers, and
respondent's agents, representatives and employees, directly or through
any corporation, subsidiary, division or other device, in connection
with the advertising or promotion of any household or automotive cabin
air filter, in or affecting commerce, as ``commerce'' is defined in the
Federal Trade Commission Act, do forthwith cease and desist from making
any representation, in any manner, directly or by implication, about
the efficacy of any such product in reducing or removing pollutants,
unless such representation is true, and at the time of making such
representation, respondent possesses and relies upon competent and
reliable scientific evidence, that substantiates such representation.
For purposes of this Order, ``competent and reliable scientific
evidence'' shall mean tests, analyses, research, studies or other
evidence based on the expertise of professionals in the relevant area,
that has 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.
Provided, however, that it shall be a defense hereunder that the
respondent neither knew nor had reason to know of an inadequacy of
substantiation for the representation.
III
It is further ordered that for three (3) years after the last date
of dissemination of any representation covered by this Order,
respondent, or its successors and assigns, 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 its possession or control that contradict, qualify, or call
into question such representation, or the basis relied upon for such
representation, including written complaints from consumers.
IV
It is further ordered that respondent notify the Commission at
least thirty (30) days prior to any proposed change in the corporate
respondent 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.
V
It is further ordered that respondent 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 officers, agents, representatives or
employees engaged in the preparation or review of advertising or other
materials covered by this Order.
VI
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 a 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.
VII
It is further ordered that respondent shall, within sixty (60) days
from the date of service of this Order upon it, and at such other times
as the Commission may require, file with the Commission a report, in
writing, setting forth in detail the manner and form in which it has
complied with this Order.
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 Young &
Rubicam Inc. (``Young & Rubicam''), a New York corporation.
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.
Young & Rubicam is an advertising agency which has prepared
advertisements for Ford Motor Company (``Ford'') and the Lincoln-
Mercury Dealers Associations (``LMDAs''). Young & Rubicam has prepared
and disseminated advertising materials to promote the sale of Ford's
Mercury Mystique and Lincoln Continental automobiles. These
advertisements have included claims regarding the efficacy of the
``MicronAir Filtration System,'' a cabin air filter installed in
Mercury Mystique and Lincoln Continental automobiles.
The Commission's complaint charges that Young & Rubicam has
prepared advertisements for the MicronAir Filtration System which
contain the false representation that this filter removes virtually all
pollutants likely to be encountered by a driver. The complaint alleges
that the MicronAir Filtration System does not, in fact, remove
virtually all such pollutants. For example, the filter has no effect on
gaseous pollutants, such as hydrocarbons, carbon monoxide, and nitrogen
oxides. Furthermore, the
[[Page 16924]]
complaint alleges that Young & Rubicam knew or should have known that
this claim was false.
The proposed consent order contains provisions designed to remedy
the violations charged and to prevent the respondent from engaging in
similar acts and practices in the future. Part I of the proposed order
prohibits the respondent from claiming that the ``MicronAir Filtration
System'' as configured in the 1995 Lincoln Continental or 1995 Mercury
Mystique, or any substantially similar product, removes virtually all
pollutants.
Part II of the proposed order prohibits the company from making any
representation, in any manner, directly or by implication, about the
efficacy of any household or cabin air filter in reducing or removing
pollutants, unless such representation is true, and at the time of
making such representation, respondent possesses and relies upon
competent and reliable scientific evidence, that substantiates such
representation. Part II provides Young & Rubicam a defense to liability
if it neither knew or had reason to know of an inadequacy in the
substantiation for the representation.
The proposed order also requires the respondent 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; 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.
[FR Doc. 96-9553 Filed 4-17-96; 8:45 am]
BILLING CODE 6750-01-M
