sizes thereof. It is further shown that the cut sizes, i.e., the dimensions of the material used in making tablecloths and elated products before hemming and finishing, are usually larger than the completed or finished sizes thereof. The record also shows that to many consumers the size marked on a tablecloth or related product means the actual size of the finished product and that this meaning is not dispelled by the words "cut size" alone without a disclosure of the finished size identified as such. Upon consideration of the entire matter, including the Commission's accumulated experience in matters involving the unqualified use of the term "cut size", the Commission has concluded that use of the "cut size” alone to designate sizes of tablecloths and related products, has the capacity and tendency to mislead consumer purchasers into believing that such size represents the actual dimensions of the finished product.

§ 404.2

Request for tolerance in stating finished sizes.

The Commission also has carefully considered requests of affected parties for a rule provision which would establish a tolerance in stating the finished sizes of their products. It was asserted that manufacturers of these products are unable to control the exact finished sizes thereof due to variations inherent in the manufacturing and processing operations, as well as to the varying characteristics of different materials used in the manufacture of such products. The primary purpose of this rule is to prevent deception of consumers as to the size of tablecloths and related products. To permit a substantial deviation from the designated size in the form of a tolerance would not be consistent with this purpose. In applying the rule, however, allowance will be made for minor deviations from the stated finished size which are unavoidable despite the exercise of due care.

$404.3 The rule.

(a) On the basis of the foregoing, the Commission concludes that the practice of selling tablecloths and related products in commerce, as "commerce" is defined in the Federal Trade Commission Act, marked as to "cut size," i.e., the dimensions of the material used in making such products, without disclosing the size of the finished products, (1) has the capacity and tendency (1) to mislead and

deceive purchasers into believing that the "cut size" represents the actual dimensions of the finished products, whereas the finished sizes of such products are in fact usually smaller than the "cut size" of the materials from which they are made, a matter of importance to the consumer, and (ii) to divert business from competitors who clearly disclose the finished size of their products, and that, therefore, (2) this practice constitutes an unfair method of competition in commerce, and an unfair and deceptive act or practice in commerce, in violation of Section 5 of the Federal Trade Commission Act. The Commission further concludes that the public interest in preventing this practice is specific and substantial.

(b) Accordingly, for the purpose of preventing such unlawful practice, the Commission hereby promulgates, as a Trade Regulation Rule, its conclusions and determination that in connection with the sale or offering for sale of tablecloths and related products such as doilies, table mats, dresser scarves, place mats, table runners, napkins and tea sets, in commerce, as "commerce" is defined in the Federal Trade Commission Act, any representation of the "cut size" or the dimensions of materials used in the construction of tablecloths and related products in advertising, labeling, marking or otherwise, constitutes an unfair method of competition and an unfair and deceptive act or practice, unless

(1) such "cut size" dimensions are accompanied by the words "cut size"; and

(2) the "cut size" is accompanied by a clear and conspicuous disclosure of the dimensions of the finished products and by an explanation that such dimensions constitute the finished size.

Example. An example of proper size marking when the product has a finished size of 50' x 68" and a cut size of 52" x 70", and disclosure is made of the cut size, is*Finished size 50′′ x 68"; Cut size 52" x 70"."

SOURCE: The provisions of this Part 405 appear at 29 F.R. 8166, June 27, 1964, unless otherwise noted.

§ 405.1

Character of the deception.

(a) Manufacturers and distributors of men's, boys', women's and children's belts have engaged in the practice of selling certain belts in commerce, as "commerce" is defined in the Federal Trade Commission Act, without adequate disclosure of facts concerning the actual composition thereof or any disclaimer that the product is leather, and have misbranded or otherwise misrepresented the content of such belts. The misbranding or deception in question has involved belts manufactured from split leather, leather fibers or dust, imitation leather or other non-leather material having the appearance of leather, and leather which has been processed or otherwise finished to simulate or resemble the appearance of a different kind of leather.

(b) Some affected parties have urged that the rule should not require affirmative disclosure with respect to the content of waist belts in the absence of any mismarking thereof.

or mislabeling

This contention is rejected for the reason that it is well settled that deception which is harmful to the business community and the consuming public can result from the misleading appearance of a product in the absence of an affirmative disclosure as to its actual composition or a disclaimer that it is leather. § 405.2 Contentions regarding terminology for split leather.

(a) Several industry members, who utilize split leather primarily in the manufacture of belts for the lower priced market, and their trade association have urged that the word "split" has a derogatory connotation in the trade and that in its place they should be permitted either to use the word "leather", without qualification, to describe such belts or to employ the term "flesh-side" instead of "split". It is argued that the consuming public would be adequately protected if the rule so provided. However, many consumers believe that the word "leather" without qualification, means top grain leather. Moreover, the precise meaning of the term "flesh-side" has not become sufficiently established to be generally accepted even among the trade and it is evident that its use at the retail level would only serve to confuse and mislead the consumer.

Some industry members expressed the view that all women's belts should be excluded from the proposed rule because many such belts are sold as part of a garment, rather than independently. This contention ignores the fact that very substantial quantities of women's belts are sold singly and not as part of a garment and thus affords no basis for excluding all women's belts from the application of the rule. Upon careful consideration the Commission has concluded that in the public interest the deception here involved would be removed by providing for the marking, tagging or labeling of women's and children's belts when sold separately, in accordance with the provisions of the rule.

§ 405.4 The rule.

Accordingly, for the purpose of preventing such unlawful practices, the Commission hereby promulgates as a Trade Regulation Rule, its conclusions and determination that in connection with the sale or offering for sale of men's and boys' belts, and women's and children's belts when not offered for sale as part of a garment, in commerce, as "commerce" is defined in the Federal Trade Commission Act, it constitutes an unfair method of competition and an unfair and deceptive act or practice to:

(a) Represent, directly or by implication, in advertising, labeling, marking or otherwise:

(1) That a belt which is not made from the hide or skin of an animal is leather (e.g., words such as "leather," "hide" or "skin," or depictions, symbols or other words or terms indicative of leather, shall not be used to describe a belt not made from the hide or skin of an animal); or

(2) That a belt is made of leather when such belt is composed of ground,

pulverized or shredded leather. This provision shall not be construed as prohibiting the use of terms such as "shredded leather fibers" or "pulverized leather," as the case may be, to describe the composition of belts; or

(3) That a belt made of split leather is "genuine cowhide," "finished cowhide," "alligator" or "leather," or use any other term which may indicate that it is composed of top grain leather. Belts composed of split leather shall be described or marked "split leather;" or

(4) That a belt is made from a specified animal hide or skin when such is not the fact (e.g., cowhide shall not be represented as "alligator" or "Morocco");

or

(5) That a belt is made wholly of a certain kind of leather or other specified material when in fact it is composed only in part of such leather or other material.

(b) Sell or distribute belts which have the appearance of leather, but which are made of split leather or ground, pulverized or shredded leather or of nonleather material, unless disclosure is made on the product or on tag or label affixed thereto of the composition of the product (e.g., "split leather" or "leather fibers" or "plastic," as the case may be) or of the fact that the product is not leather (e.g., "imitation leather").

(c) Sell or distribute belts made of leather or split leather which has been embossed, dyed or otherwise processed so as to have the appearance of a different kind of leather, unless disclosure is made on the product or on a tag or label affixed thereto of the kind of leather or split leather of which the belts are composed. For example, a belt composed of cowhide embossed or otherwise processed to simulate alligator could be described as "cowhide" or "cowhide embossed to simulate alligator," and a belt composed of split cowhide processed to simulate pigskin grain could be described as "split cowhide" or "split cowhide with simulated pigskin grain.'

(d) Sell or distribute belts having an outer surface of leather or other material, which are backed with a different kind of leather or non-leather material having the appearance of leather, unless disclosure is made on the product or on a tag or label affixed thereto of the kind or type of leather used in the backing or of the fact that the backing is of nonleather material, as the case may be.

PART 406-DECEPTIVE ADVERTISING AND LABELING OF PREVIOUSLY USED LUBRICATING OIL

Sec.

406.1 The practices involved.

406.2 406.3

406.4

Deception as to previous use of oil. Necessity for front or face panel disclosure.

Deceptive use of the term "re-refined." 406.5 The rule.

AUTHORITY: The provisions of this Part 406 issued under 38 Stat. 717, as amended; 15 U.S.C. 41-58, unless otherwise noted.

SOURCE: The provisions of this Part 406 appear at 29 F.R. 11650, Aug. 14, 1964. § 406.1 The practices involved.

Processors, wholesalers and other marketers of lubricating oil composed in whole or in part of used oil, in the sale of such oil in commerce as "commerce" is defined in the Federal Trade Commission Act, have (a) failed to disclose clearly and conspicuously the fact that such oil has been previously used or contains used oil, as the case may be, (b) represented directly or by implication that such oil is new and unused, and (c) represented that such oil has been "re-refined" when in fact the physical and chemical contaminants acquired through use have not been removed by a refining process.

§ 406.2 Deception as to previous use of oil.

(a) Reclaimers of lubricating oils generally obtain their base stocks from service stations, garages, and cther sources where crankcase drainings and other waste oils are collected. These waste products are subjected to various processes which, depending on the completeness of the process used, result in the removal of some or all of the contami

nants acquired through use. The resulting oils, which are sometimes blended with additives and sometimes with oil from virgin stocks, are customarily put into containers of the same general size, kind and appearance as those used for new and unused oil. The oil is then offered for sale to the public at gasoline filling stations and other retail outlets in the same manner and for the same purposes as unused lubricating oil. On the basis of previous Commission decisions, its knowledge of conditions in the marketing of the product, and the matters presented in the course of this rulemaking proceeding, the Commission finds that many consumers prefer new

and unused lubricating oil. In the absence of a clear and conspicuous disclosure of the fact of previous use, consumers have no means by which they can readily determine that such products are composed in whole or part of previously used oil, and are led to believe that such products are composed entirely of new and unused oil.

(b) It has been urged that reclaimers of oil perform a public service in that they collect and remove used oil which is potentially harmful and dangerous, and which otherwise would constitute an industrial and sanitation problem. It has also been asserted that oil does not wear out and therefore properly re-refined used oil is as good as or better than many oils produced entirely from virgin stock. The value of the service rendered by the industry is not germane to this consideration, nor is the quality of reclaimed oil involved here. It is not necessary therefore for the Commission to pass upon the relative merits of new and reclaimed oil. It is well settled that substitution is unlawful, even if a qualitative equivalence could be shown and the consumer is prejudiced if he is led to expect one thing and is supplied with something else. The public interest requires that used oils be labeled and advertised as such to prevent deception of the public and to maintain fair competition.

§ 406.3 Necessity for front or face panel disclosure.

(a) Lubricating oils, whether new, used, or blends thereof, are usually sold in round quart size cans or in larger cans, such as two gallon containers having an upright rectangular shape. Generally, these containers have a front or face panel on which the brand name is featured and which is designed to present a more attractive appearance than other parts of the container for display purposes. Some containers have more than one panel which is similarly designed.

(b) It is common knowledge that in garages, filling stations, and other retail outlets where lubricating oils are sold, oil containers are customarily arranged on racks or shelves in such a manner that only the front or face panel is clearly exposed to the view of prospective purchasers. Thus, any printed material appearing on other parts of the container would not readily be seen by the casual observer. In the marketplace,

many purchasers of lubricating oil identify and recognize products by viewing only the front or face panel of the container and it is unlikely that they would observe printed material appearing on other parts of the container which are not exposed to view.

(c) In view of all the circumstances, the Commission concludes that in order for the disclosure required by this part to be clear and conspicuous, it should be placed on the front or face panel of each container. If the container has more than one panel similarly designed as a front or face panel the required disclosure should be placed on each such panel.

§ 406.4 Deceptive use of the term “rerefined."

(a) Some marketers of reclaimed lubricating oil have described their products as "re-refined" when in fact such oils have been subjected to but a simple reclaiming process. The reprocessing or reclaiming of previously used oil is accomplished by various processes. Simple reclaiming may involve only the removal of insoluble physical contaminants and sometimes a treatment to reduce chemical contaminants such as fuel fractions, water, combustion, and resinous oxidation products. These simple processes do not remove many of the contaminants acquired through previous use. Experts are not in uniform agreement as to what criteria should be met to justify the use of the term "re-refined" to describe previously used oil. Many technical persons understand "re-refining" to involve a complete and extensive processing under controlled conditions such as settling, filtration, dehydration, distillation, chemical treatment, clay treatment, and other processing, including selective solvent refining. There are variations in "re-refining" methods but the ultimate purpose of all of these is to remove physical and chemical contaminants acquired through use.

(b) Contention has been made that use of the term "re-refined" alone constitutes adequate disclosure that oll so described has been previously used. Webster's New International Dictionary, Second Edition-Unabridged, defines "refine" as "To reduce to a fine, unmixed or pure state; to separate from extraneous matter, to free from dross or alloy as metals; to free or cleanse from impurities, as wine, sugar, etc." The same dictionary defines "re" as "again;-used

*

chiefly to form words, especially verbs of action, denoting in general repetition (of the action of the verb) * "The combination of these two words, when used to describe oil, would mean, by dictionary definition, that the process of reducing oil to a fine, unmixed or pure state has been repeated.

(c) To the consuming public the word "re-refined" as descriptive of lubricating oil is susceptible of more than one meaning. While members of the trade and more sophisticated consumers might understand that the oil so described had been previously used, to many consumer purchasers who are unaware that oil is reclaimed and resold to the public, "rerefined" could well mean a virgin oil which has been refined more than once. Even when put on notice that the oil has been previously used, many consumers would be led to believe by the word "re-refined" that the oil had been reclaimed and restored to its original condition by a refining process.

(d) The Commission concludes thereIfore that the word "re-refined" when used alone to describe previously used oil would not adequately inform prospective purchasers that oil so described has been previously used. The Commission further concludes that "re-refined" when coupled with a disclosure that the oil has been previously used would mean to a substantial portion of the consuming public that the oil so described has had the contaminants acquired through previous use removed therefrom by a refining process.

§ 406.5 The rule.

(a) On the basis of the foregoing, the Commission concludes that, in connection with the sale in commerce of lubricating oil composed in whole or in part of previously used oil, the practices of (1) failing to disclose clearly and conspicuously the fact that such oil has been previously used; (2) representing directly or by implication that such oil is new or unused; and (3) representing that such oil has been "re-refined" when the E physical and chemical contaminants ac=quired through use have not been reE moved by a refining process; have the capacity and tendency to mislead and receive purchasers and prospective purchasers and to divert business from competitors who truthfully and properly describe and label their products. The Commission further concludes that these

practices are violative of section 5 of the Federal Trade Commission Act, and that the public interest in preventing their use is specific and substantial.

(b) Accordingly, for the purpose of preventing such unlawful practices, the Commission hereby promulgates, as a Trade Regulation Rule, its conclusions and determination that in connection with the sale or offering for sale of lubricating oil composed in whole or in part of previously used lubricating oil, in commerce, as "commerce" is defined in the Federal Trade Commission Act, it constitutes an unfair method of competition and an unfair and deceptive act or practice to:

(1) Represent in any manner that such used lubricating oil is new or unused; or (2) Fail to disclose clearly and conspicuously that such used lubricating oil has been previously used, in all advertising, sales promotional material and on each front or face panel of the container. For the purpose of this Part 406 the front or face panel means the part (or parts) of the container on which the brand name is usually featured and which is customarily exposed to the view of prospective purchasers when displayed at point of retail sales; or

(3) Use the term "re-refined," or any other word or term of similar import, to describe previously used lubricating oil unless the physical and chemical contaminants acquired through previous use have been removed by a refining process. (As used in this part, the term "lubricating oil" refers to any oil used for lubricating purposes including but not limited to, motor and transmission oil.)