{"text":"b'UNITED STATES OF AMERICA\\n\\nFederal Trade Commission\\nWASHINGTON, D.C. 20580\\n\\nJoshua S. Millard\\nAttorney, Division of Enforcement\\nPhone: (202) 326-2454\\nEmail: jmillard@ftc.gov\\n\\nAugust 26, 2019\\n\\nBeth Deisher\\nCoordinator, Anti-Counterfeiting Task Force\\nAnti-Counterfeiting Educational Foundation, Inc.\\nP.O. Box 903\\nSylvania, OH 43560\\nRe: Anti-Counterfeiting Educational Foundation, Inc. - Advisory Opinion\\nDear Ms. Deisher,\\nThis is in reply to your August 8, 2019 email to the staff of the Federal Trade\\nCommission (\\xe2\\x80\\x9cFTC\\xe2\\x80\\x9d) on behalf of Anti-Counterfeiting Educational Foundation, Inc. (\\xe2\\x80\\x9cACEF\\xe2\\x80\\x9d),\\nrequesting an opinion concerning the marking of the word \\xe2\\x80\\x9cCOPY\\xe2\\x80\\x9d on imitation numismatic\\nitems pursuant to the Rules and Regulations Under the Hobby Protection Act, 16 C.F.R. part 304\\n(\\xe2\\x80\\x9cHobby Rules\\xe2\\x80\\x9d).1 In your email, you requested a response to the following questions:\\n\\xe2\\x80\\x9cDoes the incusing of the word \\xe2\\x80\\x98COPY\\xe2\\x80\\x99 have to be part of the manufacturing\\nprocess or can it be applied later?\\xe2\\x80\\x9d\\n\\xe2\\x80\\x9cIf it can be applied later, can any entity or individual citizen apply the word\\n\\xe2\\x80\\x98COPY\\xe2\\x80\\x99 as long as it is in compliance with the requirements set forth in \\xc2\\xa7304.6?\\xe2\\x80\\x9d\\nYour email reported that members of the numismatic community have asked ACEF\\nwhether it would be legal for them to mark imitation U.S. coins identified in the marketplace\\nwith the word \\xe2\\x80\\x9ccopy.\\xe2\\x80\\x9d Additionally, you conveyed that some persons have suggested that ACEF\\nhave punches made to the specifications set forth in 16 C.F.R. \\xc2\\xa7 304.6 and offer to mark\\nimitation numismatic items as such as a service at coin shows.\\n\\n1\\n\\nAs defined in the Hobby Protection Act, 15 U.S.C. \\xc2\\xa7\\xc2\\xa7 2101-06 (\\xe2\\x80\\x9cHobby Act\\xe2\\x80\\x9d), an imitation\\nnumismatic item is \\xe2\\x80\\x9can item which purports to be, but in fact is not, an original numismatic item\\nor which is a reproduction, copy, or counterfeit of an original numismatic item.\\xe2\\x80\\x9d Id. \\xc2\\xa7 2106(4).\\nThe Hobby Act defines original numismatic items to include coins, tokens, paper money, and\\ncommemorative medals that have been part of a coinage or issue used in exchange or used to\\ncommemorate a person or event. See id. \\xc2\\xa7 2106(3).\\n\\n\\x0cMs. Beth Deisher\\nAnti-Counterfeiting Educational Foundation, Inc.\\nAugust 26, 2019\\nIn response to your questions, as discussed below, FTC staff opines that with respect to\\nunmarked imitation numismatic items found in commerce, entities other than the manufacturer\\nor importer may mark the word \\xe2\\x80\\x9ccopy\\xe2\\x80\\x9d on such items after their manufacture following the\\nmarking requirements set forth in 16 C.F.R. \\xc2\\xa7 304.6. However, such markings do not excuse\\nprior violations by entities required to comply with the Hobby Act and Hobby Rules.\\nThe Hobby Act requires manufacturers and importers of imitation numismatic items, as\\nwell as persons or entities engaged in \\xe2\\x80\\x9cthe sale in commerce\\xe2\\x80\\x9d of such items, to mark such items\\n\\xe2\\x80\\x9cplainly and permanently\\xe2\\x80\\x9d with the word \\xe2\\x80\\x9ccopy.\\xe2\\x80\\x9d 15 U.S.C. \\xc2\\xa7 2102(b).2 Consistent with the\\nHobby Act, the Hobby Rules establish, among other things: (1) the location of markings on\\nitems; (2) the sizes and dimensions of the letters and numerals to be used; and (3) how to mark\\nnonincusable and incusable items. 16 C.F.R. \\xc2\\xa7 304.6. Incusable items are those that can be\\nimpressed with a stamp.\\nAs to the timing of the \\xe2\\x80\\x9ccopy\\xe2\\x80\\x9d mark, the Hobby Act and Hobby Rules establish that\\nimitation numismatic items must be marked at least in the domestic manufacture of such items or\\nbefore the importation of such items into the United States for introduction into or distribution in\\ncommerce. 15 U.S.C. \\xc2\\xa7\\xc2\\xa7 2101(b), 2104; 16 C.F.R. \\xc2\\xa7 304.6. Failure to comply subjects violators\\nto liability in governmental and private actions.3 Accordingly, the marking of the word \\xe2\\x80\\x9ccopy\\xe2\\x80\\x9d\\nmust be part of the domestic manufacturing process for imitation numismatic items and must\\noccur prior to importation of such items made outside the United States. Persons engaged in the\\nsale in commerce of such items must also comply. 15 U.S.C. \\xc2\\xa7 2101(b); 16 C.F.R \\xc2\\xa7 304.3.\\nNotwithstanding the foregoing, the Hobby Act and the Hobby Rules do not prohibit\\nentities other than manufacturers and importers from subsequently marking unmarked imitation\\nnumismatic items as copies pursuant to the marking requirements of the Hobby Rules, 16 C.F.R.\\n\\xc2\\xa7 304.6. Indeed, the Hobby Act and the Hobby Rules contemplate that persons engaged in the\\nsale in commerce of such items will comply with the marking requirement prior to such sales, 15\\nU.S.C. \\xc2\\xa7 2101(b), 16 C.F.R. \\xc2\\xa7 304.3. However, later markings do not excuse prior violations by\\nentities required to comply with the Hobby Act and Hobby Rules. For example, if a coin owner\\nwho obtained an unmarked imitation 1932-S Washington Quarter from an importer discovers\\nthat it is a copy and chooses to mark it as a copy for purposes of identification, that marking\\nwould not relieve the importer from liability for failing to comply with the Hobby Act and\\nHobby Rules.\\nPlease note that this letter only expresses an opinion concerning laws enforceable by the\\nFederal Trade Commission. See 15 U.S.C. \\xc2\\xa7 2105 (provisions of Hobby Protection Act \\xe2\\x80\\x9care in\\n2\\n\\nIt is also a violation of the Hobby Act for a person to provide substantial assistance, or support,\\nto any manufacturer or importer or seller of imitation numismatic items if that person knows or\\nshould have known that the assisted or supported entity is violating the Hobby Act\\xe2\\x80\\x99s marking\\nrequirements. Id. \\xc2\\xa7 2102(d).\\n3\\nViolations of the Hobby Act are enforceable by the Commission as violations of the Federal\\nTrade Commission Act, 15 U.S.C. \\xc2\\xa7\\xc2\\xa7 2101(b), 2103, and also provide grounds for private suits\\nseeking injunctive relief and damages. Id. \\xc2\\xa7 2102.\\n\\n\\x0cMs. Beth Deisher\\nAnti-Counterfeiting Educational Foundation, Inc.\\nAugust 26, 2019\\naddition to, and not in substitution for or limitation of, the provisions of any other law of the\\nUnited States or of the law of any State\\xe2\\x80\\x9d).\\nIn accordance with Section 1.3(c) of the Commission\\xe2\\x80\\x99s Rules of Practice and Procedure,\\n16 C.F.R. \\xc2\\xa7 1.3(c), this is a staff opinion only and has not been reviewed or approved by the\\nCommission or by any individual Commissioner, and is given without prejudice to the right of\\nthe Commission later to rescind the advice and, where appropriate, to commence an enforcement\\naction.\\nIn accordance with Section 1.4 of the Commission\\xe2\\x80\\x99s Rules of Practice and Procedure, 16\\nC.F.R. \\xc2\\xa7 1.4, this response to your request for advice will be placed on the public record.\\nSincerely,\\n\/s\/\\nJoshua S. Millard\\nAttorney, Division of Enforcement\\n\\n\\x0c'","created_timestamp":"August 26, 2019","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/system\/files\/documents\/advisory_opinions\/letter-joshua-s-millard-staff-attorney-division-enforcement-bureau-consumer-protection\/hobby_rules_staff_opinion_letter_-_082619.pdf"}
{"text":"b'UNITED STATES OF AMERICA\\n\\nFEDERAL TRADE COMMISSION\\nWASHINGTON, D.C. 20580\\n\\nBureau of Consumer Protection\\nDivision of Enforcement\\nHampton Newsome\\nDirect Dial: (202) 326-2889\\nFax: (202) 326-2558\\nEmail: hnewsome@ftc.gov\\n\\nJanuary 3, 2018\\n\\nMr. Clark R. Silcox, General Counsel\\nNational Electrical Manufacturers Association\\n1300 North 17th Street, Suite 900\\nRosslyn, Virginia 22209\\nDear Mr. Silcox:\\nThis staff opinion letter responds to your recent request for guidance regarding mercury\\xc2\\xad\\nrelated light bulb disclosures under the FTC\\' s Energy Labeling Rule (16 C.F.R. Part 305). The\\nRule(\\xc2\\xa7 305.15(b)) requires manufacturers to include an Environmental Protection Agency\\n(EPA) web address (\"epa.gov\/cfl\") on lamps containing mercury as well as on the packaging for\\nthose products. The EPA website provides consumers with information about the cleanup and\\ndisposal of mercury-containing bulbs. When the Commission issued these disclosure\\nrequirements in 2010 (75 Fed. Reg. 41696), the predominant mercury-containing bulbs on the\\nmarket were compact fluorescent lamps (\"CFLs\"). However, as your letter explains, other\\nmercury-containing bulbs have become available more recently, including induction lamps. As\\nyour letter suggests, the letters \"cfl\" in the URL mandated by the current Rule may be confusing\\nto some consumers using these newer, non-CFL bulb types.\\nYou are seeking guidance on whether, to minimize potential consumer confusion,\\nmanufacturers of these bulbs may use an alternative URL (\"epa.gov\/bulb\") to direct consumers\\nto the EPA inf01mation. Although the Rule specifies use of the \"epa.gov\/cfl\" address, we would\\nnot recommend enforcement action if manufacturers of non-CFL bulbs use your suggested\\nalternative address to connect consumers to the EPA website. The alternative URL would direct\\nconsumers to the same EPA information about lamp cleanup and disposal while avoiding\\npotential confusion created by the \" epa.gov\/cfl\" address. To that end, we have discussed this\\nissue with EPA staff, and they have created the alias web address \"epa.gov\/bulb\" to take\\nconsumers directly to \"epa.gov\/cfl.\" In the future , we will consider recommending Rule\\namendments that include this address as an option for manufacturers.\\nThe views expressed in this letter are those of FTC staff assigned to enforce the\\nCommission\\' s Energy Labeling Rule (16 C.F.R. Part 305). In accordance with Section l .3(c) of\\nthe Commission\\' s Rules of Practice and Procedure, 16 C.F.R. \\xc2\\xa7 1.3(c), this is a staff opinion only\\n\\n\\x0cPage 2\\nand has not been approved by the Commission or by any individual Commissioner. The advice\\nprovided in this letter is not binding upon the Commission and is given without prejudice to the\\nright of the Commission later to rescind the advice and, when appropriate, to commence an\\nenforcement proceeding. In conformance with Section 1.4 of the Commission\\'s Rules of\\nPractice, 16 C.F.R. \\xc2\\xa7 1.4, this letter is being placed on the public record. If you have any further\\nquestions, please contact me at (202) 326-2889.\\n\\n~~~\\nHampton Newsome\\nAttorney\\n\\n\\x0c'","created_timestamp":"January 3, 2018","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/system\/files\/documents\/advisory_opinions\/letter-hampton-newsome-staff-attorney-division-enforcement-bureau-consumer-protection\/nemaletter-1-03-2018.pdf"}
{"text":"b'UNITED STATES OF AMERICA\\n\\nFederal Trade Commission\\nWASHINGTON. D.C. 20580\\n\\nJock Chung\\nDivision of Enforcement\\nPhone: (202) 326-2984\\nEmail: jchung@ftc.gov\\n\\nDecember 14, 2017\\n\\nDonald S Stein, Esq.\\nGreenberg Traurig, LLP\\n2101 L Street, NW, Suite 1000\\nWashington, DC, 20037\\n\\nRe: Piirlin, LLC Advisory Opinion\\nDear Mr. Stein,\\nThis is in reply to your September 14, and October 27, 2017, letters on behalf of Plirlin,\\nLLC (\"Ptirlin\") requesting an opinion that Purlin\\'s bedding is not a product intended for uses\\nsubject to the Textile Products Identification Act, 15 U.S.C. \\xc2\\xa7 70 (the \"Textile Act\" or \"Act\"),\\nand its implementing regulations, the Rules and Regulations Under the Textile Fiber Products\\nIdentification Act, 16 C.F.R. Part 303 (the \"Textile Rules\" or \"Rules\"). You request\\nconfirmation that the Textile Act and Rules do not require Ptirlin to attach labels to its recyclable\\nbedding at the time it provides the bedding to institutions.\\nAs discussed below, based on the facts provided by Ptirlin, staff opines that Ptirlin\\'s\\nrecyclable bedding does not fall within the definition of \"household textile article\" in Section\\n70(g) of the Textile Act. Consequently, in our view, Ptirlin\\'s recyclable bedding is not covered\\nby the Textile Act or the Textile Rules, and Pfulin may provide its bedding to institutions\\nwithout labels.\\nAccording to your letters and statements to me, the issues present the following facts:\\nPtirlin offers woven recyclable bedding (sheets and pillowcases) made from polyester fiber to\\nhealthcare, hospitality, and similar institutions. It does not offer this product to individual\\nconsumers. This bedding is not washed, but after one use is disposed of through recycling.\\nPtirlin arranges for the bedding to be recycled into pellets, which are then extruded at high\\ntemperatures into sterilized fibers to be woven into hygienic recyclable fabric. Prior to recycling,\\nany labels on the bedding must be removed to prevent label ink from contaminating the fibers\\nproduced through recycling. According to Ptirlin, consumer recycling facilities cannot recycle\\nits bedding.\\nThe Textile Act prohibits the introduction into commerce of any misbranded \"textile fiber\\nproduct,\" where such a product is \"any household textile article made in whole or in part of yam\\n\\n\\x0cor fabric,\" or fiber, yam, or fabric to be used in a household textile article. 1 The Act defines\\n\"household textile articles\" as \"articles of wearing apparel, ... beddings, and other textile goods\\nof a type customarily used in a household regardless of where used in fact. \" 2 A product is \\xc2\\xb7\\nmisbranded if it is not labeled with required information prior to being produced in the form\\nintended for sale, delivery to, or for use by the \"ultimate consumer,\" 3 defined as \"a person who\\nobtains a textile fiber product by purchase or exchange with no intent to sell or exchange such\\ntextile fiber product in any form. \" 4\\nMost bedding, such as cotton bedding, is of a type customarily used in a household and\\nconsequently falls under the Textile Fiber Act, even when such bedding is used in an institution,\\nsuch as a hospital. However, Pilrlin\\'s recyclable bedding is offered exclusively to institutions,\\nand only they have access to Ptirlin\\'s recycling services. 5 Consequently, in our view, Pilrlin\\'s\\nrecyclable bedding is not a household textile article and therefore not covered by the Textile\\nAct\\'s or Rules\\' labeling requirements.\\nWe base this opinion on the specific facts. If, at any time, Ptirlin or any other entity,\\noffers similar recyclable bedding for household use, its bedding would fall within the Textile\\nAct\\'s definition of a household textile product and must be labeled pursuant to the Textile Act\\n\\xc2\\xb7\\nand Textile Rules. 6\\nIn accordance with Section 1.3(c) of the Commission\\'s Rules of Practice and Procedure,\\n16 C.F .R. \\xc2\\xa7 1.3(c), this is a staff opinion only and has not been reviewed or approved by the\\nCommission or by any individual Commissioner, and is given without prejudice to the right of\\nthe Commission later to rescind the advice and, where appropriate, to commence an enforcement\\naction.\\n\\n15 U.S.C. \\xc2\\xa7 70(h). The definition excludes products covered by the Wool Products Labeling Act of 1939, 15\\nU.S.C. 68 et seq.\\n2 The Act covers such articles even where they are used outside of the house. For example, the Commission has\\nrequired industrial work gloves and diving wetsuits to be labeled under the Textile Act. Magid Mfg. Co., Inc., 75\\nF.T.C. 808 (1969); Dive N\\' Surf, Inc., 114 F.T.C. 798 (1991).\\n3 15 U.S.C. 70a(d)(5).\\n4 15 U.S.C. 70(m). You also suggest that Ptirlin\\'s bedding is not intended for sale, delivery, or for use by the\\n\" ultimate consumer,\" and therefore Ptirlin could comply with the Rules merely by disclosing required information in\\nan invoice or other document, e.g., a package label, pursuant to Section 303.31. You assert that the institutions\\nbuying Ptirlin\\'s bedding are not \"ultimate consumers\" because, at the time they receive it, they intend to eventually\\nexchange it for new bedding. We disagree with this interpretation. The Act implicitly defines \" ultimate consumer\"\\nas a person who obtains a textile fiber product with no intent to sell or exchange it unused. Under the Act, for\\nexample, a manufacturer can provide unlabeled textile fiber products to a wholesaler who intends to sell the\\nproducts unused to retailers. Under Ptirlin\\'s contention, however, stores could sell unlabeled garments to be worn\\nby purchasers, as long as they intend to eventually sell or exchange the garments. This interpretation would obviate\\nthe Act.\\n5 In fact, because its recycling services are only available to Plirlin \\'s institutional customers, it would be deceptive to\\nrepresent its bedding as recyclable to consumers. See FTC v. AJM Packaging Corp., No. I: I 3-cv- 1510 (D.D.C. Oct.\\n1, 2013); see Green Guides, I 6 C.F.R. \\xc2\\xa7 260.12 (stating it would be deceptive to advertise a product as recyclable\\nwhen recycling facilit ies are unavailable to consumers or communities where the item is sold).\\n6 Pi.irlin has represented that its woven recyclable bedding is a unique product, and that it has a patent pending for\\nthis product.\\n1\\n\\n\\x0cIn accordance with Section 1.4 of the Commission\\'s Rules of Practice and Procedure, 16\\nC.F.R. \\xc2\\xa7 1.4, your request for advice, along with this response, will be placed on the public\\nrecord.\\n\\n-y~\\n\\n~~\\'(h~AA~\\nJock Chungvv--\\n\\n\\x0c'","created_timestamp":"December 14, 2017","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/system\/files\/documents\/advisory_opinions\/letter-jock-chung-staff-attorney-division-enforcement-bureau-consumer-protection\/purlin_staff_opinion_letter_final.pdf"}
{"text":"b'UNITED STATES OF Al\\\\1ERICA\\n\\nFederal Trade Commission\\nWASHINGTON, D.C. 20580\\n\\nDivision of Financial Practices\\nBureau of Consumer Protection\\n\\nApril 7, 2016\\n\\nJeff Appel\\nDeputy Under Secretary\\nU.S. Department ofEducation\\nOffice of the Under Secretary\\n400 Maryland Ave, SW\\nWashington, DC 20202\\nDear Mr. Appel,\\nThis letter is in response to your request for a staff advisory opinion regarding the\\nFederal Trade Commission\\' s Trade Regulation Rule Concerning Preservation of\\nConsumers\\' Claims and Defenses, 16 C.P.R. \\xe0\\xb8\\xa2\\xe0\\xb8\\x87 433, commonly known as the Holder\\nRule. Specifically, you note that courts commonly allow consumers to assert time-barred\\nclaims defensively, even if they would not be able to assert such claims in an affirmative\\nlawsuit, and ask if such defensive claims would be permitted under the Holder Rule. As\\nexplained below, the Holder Rule would permit the time-barred claims or defenses\\nagainst the holder, if state law would permit the time-barred claims or defenses against\\nthe seller.\\nThe Holder Rule protects consumers who enter into credit contracts with a seller\\nof goods or services by preserving their right to assert claims and defenses against any\\nholder of the contract, even if the original seller subsequently assigns the contract to a\\nthird-party creditor. In particular, the Holder Rule requires sellers that arrange for or\\noffer credit to finance consumers\\' purchases to include in their credit contracts the\\nfollowing Notice:\\nANY HOLDER OF THIS CONSUMER CREDIT CONTRACT IS SUBJECT TO\\nALL CLAIMS AND DEFENSES WHICH THE DEBTOR COULD ASSERT\\nAGAINST THE SELLER OF GOODS OR SERVICES OBTAINED\\n[PURSUANT HERETO OR] WITH THE PROCEEDS HEREOF. RECOVERY\\nHEREUNDER BY THE DEBTOR SHALL NOT EXCEED AMOUNTS PAID\\nBY THE DEBTOR HEREUNDER.\\n16 C.P.R. \\xe0\\xb8\\xa2\\xe0\\xb8\\x87 433.2.\\nA creditor or assignee of the contract is thus subject to all claims or defenses that\\nthe consumer could assert against the seller. As you note in your request, the Guidelines\\nthat accompany the Holder Rule explain that \"claims and defenses\" are \"not given any\\nspecial definition by the Commission.. . . Appropriate statutes, decisions, and rules in\\n\\n\\x0ceach jurisdiction will control, and the pertinent rules oflaw and equity, including rules of\\nevidence, procedure, and statutes of limitations, will continue to apply.\" 1\\nThus, the Rule protects consumers\\' existing claims and defenses, and does not\\ncreate any new claims or defenses for the consumer. Accordingly, if a statute of\\nlimitations bars an affirmative lawsuit against a seller under state law, that law would\\ncontinue to apply. If, however, other applicable state law would still permit the claim\\nagainst the seller, then under the Holder Rule, the claim could be used as to subsequent\\nholders of the contract. Further, if state law allows consumers to assert time-barred\\nclaims as defenses against the seller, then the Holder Rule would allow consumers to\\nassert such defenses against subsequent holders as well.\\nPlease be advised that the views expressed in this letter are those of the FTC staff.\\nThey have not been reviewed, approved, or adopted by the Commission, and they are not\\nbinding upon the Commission. However, they do reflect the opinions of those staff\\ncharged with enforcement of the Holder Rule.\\n\\nSincerely,\\n\\nSv~\\nStephanie Rosenthal\\nChief of Staff, Division of Financial Practices\\nFederal Trade Commission\\nBureau of Consumer Protection\\n\\n1\\n\\nFTC, Guidelines on Trade Regulation Rule Concerning Preservation ofConsumers\\' Claims and\\nDefenses, 41 Fed. Reg. 20022 (May 14, 1976), available at\\nhttps:\/\/www.ftc.gov\/system\/files\/documents\/rules\/holder-rule\/760504hidcrule.pdf.\\n\\n2\\n\\n\\x0c'","created_timestamp":"April 7, 2016","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/system\/files\/documents\/advisory_opinions\/letter-stephanie-rosenthal-chief-staff-division-financial-practices-bureau-consumer-protection-jeff.s.department-education\/160407letter_dept_ed.pdf"}
{"text":"b'COWAN\\nLIEBOW\\nLA\\'\\n\\nCowan, Liebowitz & Latman, P.c.\\n1133 Avenue of the Americas\\nNew Yorl<, NY 10036\\n(212) 79~9200 Tel\\n(212) 575-0671 Fax\\nwww.cll.com\\n\\nCJ. Erickson\\n(212) 790-9274\\ncje@cU.com\\n\\nMay 29, 2012\\n\\nBY FEDERAL EXPRESS\\n\\nFederal Trade Commission\\n6th Street and Pennsylvania Avenue, N.W.\\nWashington, D.C. 20580\\nAttention: Donald S. Clark, Esq., Secretary\\nRe:\\n\\nAdvisory Opinion Request of MJJ Brilliaut Jewelers, Inc.\\nMarking\/Advertising of Precious Metal Jewelry\\n\\nDear Secretary Clark:\\nOn behalf of our client MJJ BriJliant Jewelers, Inc., New York, New York (\"MJJ\" or the\\n\"Company\"), and as discussed with Federal Trade Commission Counsel via telephone\\nconference, [\\n.J\\nIn light of the expected solicitation of public comments governing proposed revisions to the\\nJewelry Guides, the Company believes it will be more beneficial to address these general issues\\nin concert with the comments of other interested parties. The Company does, however, seek\\nguidance on its proposed marking and advertising of certain products to ensure that its\\nprocedures are within the letter and intent of the existing Jewelry Guides. This request is\\nappropriate under the Commission\\'s Rules of Practice because the proposed marketing andlor\\nadvertising claims involve a novel question of fact or law for which there is no clear Commission\\nor court precedent.\\nProduct\\n\\nthe escalating cost of precious metals, notably gold, coupled with increasing demand,\\nhas resulted in an industry demand for more reasonably priced alternatives. MJJ has inve.sted\\n\\nJFK Aml\"ORT\\xc2\\xb7OFF[ClI \\xe2\\x80\\xa2 2016 LINDEN BIND. Surra 18, ELMONf, NY 11003 \\xe2\\x80\\xa2 (212) 790-.9200\\n\\n\\x0cCowan, Liebowitz & Latman, P.C.\\nFTC Bureau of Consumer Protection\\nMay 29, 2012\\nPage 2\\n\\nsignificant resources in developing an alternative alloy formulation that preserves the appearance\\nand functionality of gold at a more reasonable cost to consumers .. The proprietary alloy,\\nidentified as [\\nJ (hereinafter, the \"MJJ Alloy\"), and is\\ncomposed of [ ]% gold (periodic IJlement Au), [ )% silver (periodic element Ag), [ ]%\\n__ _palladi urn (neriodic elemenLP_a),_and_[_]O,-\\'\"-hase_metals.\\n\\nLaw\\nThe issue herein is whether MJJ Brilliant\\'s proposed use of the term \"gold\" as part of its\\nattempt to accurately identify the specific composition of the MJJ Alloy in jewelry is proper\\nunder Section 5 of the FTC Act, which declares \\'\\'unfair\\'\\' or \"deceptive acts or practices\"\\nunlawful. The Cotrunission\\'s Policy Statement on Deception! states that the Commission\\nanalyzes deceptive business practices under the following rubric:\\n1. There must be a representation, omission or practice that is likely to mislead the\\nconsumer. This includes the \"use of bait and switch techniques.\"\\n2. The practice is examined from the perspective of a reasonable person in the\\ncircumstances. If the practice \"is directed primarily to a particular group,\" such as\\nInternet users, \"the Commission examines reasonableness from the perspective of that\\ngroup.\"\\n3. The representation, omission or practice must be a material one, i.e\" it is likely to affect\\nthe consumer\\'s conduct or decision regarding the produce or service.\\nThus, an advertisement is \"deceptive\" if it includes material information that is false or\\nthat is likely to mislead a consumer acting reasonably under the circumstances. Likewise, an\\nadvertisement is deceptive if it omits material information, and that omission is likely to mislead\\na consumer acting reasonably under the circumstances. 2 Requiring accurate disclosure of\\nmaterial terms allows consumers to compare sirhilar services offered by one or multiple\\nproviders and weigh the different terms being offered in making decisions about what services to\\npurchase.\\nThe Commission has formulated guides for various industry products, which set forth the\\nCommission\\'s \"current thinking\" about claims for certain products. The Jewelry Guides, which\\n!\\n\\nFederal Trade Comm\\'n, Policy 8Mement on Deception (Oct. 14, 1983)\\nAssocs\" 103 F.T.C. at 175 (appending FTC Policy Statement on Deception).\\n\\n2 Cliffdale\\n\\n\\x0cCowan, Liebowitz & Latman, P.c.\\nFTC Bureau of Consumer Protection\\nMay 29,2012\\nPage 3\\nare found at 19 C.F.R. Part 23 (\"Jewelry Guides\"), are administrative interpretations of Section 5\\nof the FTC Act prohibiting \"unfair or deceptive\" statements or claims in a product\\'s marketing if\\nthat marketing misrepresents a product\\'s true composition. The underlying intent of these policy\\nstatements is to ensure that the representations in advertising \"will put consumers on notice that\\n____ ---.:th.e_p.I~t.Jl.<mtains..Jlertain-precious-metals,-thereb\\xc2\\xa5-putting_them-in-a-posith;>D-to-inquireof\\'-th~---- - - jeweler as to the relevant value of the different metals and the overall value of the product.,,3\\nSection 23.1 of the Jewelry Guides expressly states that \"It is unfair or deceptive to\\nmisrepresent the type, kind, grade, quality, quantity, metallic content, size, weight. .. or any other\\nmaterial aspect of an industry product.\" Note 2 to \\xc2\\xa7 23.1 further provides that \"To prevent\\ndeception, any qualifications or disclosures ... should be sufficiently clear and prominent.\" The\\nclear intent of the Jewelry Guides is to avoid deception of, or confusion among, consumer\\npurchasers offmished articles of jewelry by prohibiting use of the term \"gold\" as an adjective for\\nfinished jewelry. They cannot be read to preclude advertisers from using truthful and accurate\\nstatements of product content, nor can they be interpreted in a way that prohibits the use of new\\nmaterials developed and recognized throughout the industry subsequent to implementation of the\\nJewelry Guides.\\n\\nIndustry Standard and Pra1:tice\\nPrecious metal alloys have become common in the jewelry trade over the past several\\nyears due to the escalating price of precious metals. The industry is replete with examples of\\nadvertising, marketing and labeling to such an extent that consumers now require greater content\\ndetail and clarification of the items they are purchasing. Attached are examples of current\\nadvertisements that evidence this trend. None of these identify the finished item of jewelry as an\\narticle of \"gold,\" but rather provide content information to the consumer to avoid confusion and\\ndeception. We believe the truthful, accurate and complete description of product contents not\\nonly meets the requirements and intent of the Jewelry Guides, but is mandated by it. The failure\\nto disclose this information is inherently deceptive as the broad range and use of precious metal\\nalloys in the jewelry trade afford consumers no basis to assess the value of purchased\\nmerchandise.\\n\\n3 Guides for the Jewelry, Precious Metals, and Pewter Industries, 62 Fed. Reg. 16,673,\\n16,674 (Apr. 8, 1997).\\n\\n\\x0cCowan, Liebowitz & Latman, P.C.\\nFTC Bureau of Consumer Protection\\nMay 29, 2012\\nPage 4\\nMoreover, many of these products are the same color as 10kt., 14kt. and 18kt. gold. The\\nsimilar color, coupled with the high price point of these products, imply a precious metal content.\\nProhibiting a truthful disclosure of the actual precious metal content serves only to exacerbate\\nconsumer confusion by creating an inability to distinguish between gold alloys of between 1kt\\n_ ancllQJ,<:t. This is clearl)l an unintended.Qonsequence,anda.violationof-atieast-the-intent-of-the----\\xc2\\xb7\\nJewelry Guides.\\nThe Jewelry Guides were originally designed, in part, to prevent consumer deception and\\nconfusion when purchasing \"finished articles of gold jewelry. A standard was implemented to\\nprovide a threshold for which a consumer can be assured of obtaining a known value. The 10 kt.\\nminimum standard was implemented as the basis for identifying a \"finished product as \"gold.\"\\nProducts consisting of less than 10 kt. cannot, absent more, be identi\"fied as gold. The Jewelry\\nGuides do not, however, relate to, restrict or limit the use of gold in the construction of finished\\njewelry. In fact, in light of the introduction of new alloys which appear indistinguishable to the\\nconsumer in terms of look, color and feel, the Jewelry Guides must be read to permit accurate\\nand truthful content information.\\nIn addition, The FTC has previously acknowledged the value of harmonization of U.S.\\nand Canadian regulations applicable to trading partners in both jurisdictions. This stems from\\nFTC comments on the Canadian Guide to the Precious Metals Marking Act and Regulations.\\nThe U.S. and Canadian Guides are strikingly similar, both prohibiting a dealer from selling,\\nimporting or advertising any precious metal article in a manner which is false or misleading as to\\nthe precious metal content. The Canadian Guides do not restrict the use of the term \"gold,\" or\\nprohibit providing an assay report to identify the contents of a gold alloy article, if used in a nondeceptive and non-misleading manner. We believe the U.S. jewelry guides can be read\\nconsistently with the Canadian guides in allowing MJJ\\'s proposed marketing and advertising, as\\nset forth below.\\nMJJ Proposed Marketing and Product Stamping\\n\\nMJJ is aware that it cannot stamp or market its gold alloy jewelry with the traditional\\nkarat marking standard as the alloy is admittedly less than 10 karat fineness. The articles are,\\nhowever, constructed of an alloy consisting of the precious metal elements gold, silver and\\npalladium, with the appearance and feel of gold. Due to its unique new nlUlle and content, the\\ncomposition of the MJJ Alloy is not yet nnderstood within the industry or the public based on\\n\\n\\x0cCowan, Liebowitz & Latman, P.C.\\nFTC Bureau of Consumer Protection\\nMay 29,2012\\nPage 5\\n\\nname alone, As with other trademarked or newly created products, market recognition and\/or\\ncustomer understanding of the product is based primarily upon information supplied by the\\ntrademark\/patent owner or producer of the goods, Without such efforts, the consumer would be\\nunable to malee a well-informed decision as to the product. Our reading of the Jewelry Guides\\n. mandate\\xc2\\xa3.thtLl:lcQurateJdentificationof ihe.specificcomposition of the\\xc2\\xb7precious and-nQn-preciQus\\xc2\\xb7\\nmetals contained within the MJJ Alloy,\\nAs discussed, MJJ proposes to market its gold alloy jewelry by fully declaring the\\ncontents, By doing so it is not describing the item as a gold product, but identifying the contents\\nin an accurate, truthful, non-deceptive manner. Specifically, MJJ proposes use of the following\\nin advertising and marketing materials, and requests confirmation that each is acceptable:\\n(1)\\n\\nuse of the term: consisting of a proprietary alloy of gold, silver, and platinum,\\n\\n(2)\\n\\na link to a third party assay report identifying the precious metal content of the\\nfinished article. A representative report is attached.\\n\\n(3)\\n\\nidentification of the specific percentage content of all precious metals in the\\nfinished article,\\n\\n(4)\\n\\nstamping its merchandise with the company\\'s [\\n\\n1trademark.\\n\\nAll of the above are in compliance with the Jewelry Gnides as they do not misrepresent\\nthe advertised articles as gold and non-deceptively describe the items in a way that enables\\nconsumers to evaluate and compare the items against similar jewelry widely marketed and\\ndistributed to the public. As set forth above, we believe the proposed language eliminates\\nconsumer confusion,\\nConclusion\\n\\nIn light of the Commission\\'s clear jurisdiction and its enforcement activity in this area,\\nMJJ has exercised due care in seeking advance direction from the Commission on proposed\\nadvertising of its jewelry. Based on the foregoing, and in accordance with Section l.3(c) of the\\nCommission\\'s Rules of Practice and Procedure, 16 C,F.R, \\xc2\\xa7 1.3(c), we respectfully request that\\nthe Commission of FTC Staff issue an advisory opinion confirming that the marketing language\\nis in accordance with existing law, agency regulations and applicable guidelines governing\\n\\n\\x0cCowan, Liebowitz & Latman, P,C.\\nFTC BUl\\'eau of Consumer Protection\\nMay 29, 2012\\nPage 6\\n\\nprecious metal jewelry, as the proposed qualifying statements are accurate, truthful, and\\ncomplete, providing consumers with non\\xc2\\xb7deceptive information regarding the construction and\\nvalue of our client\\'s merchandise. Moreover, the proposed language does not mis-identify the\\nwholesale and retail products as gold, nor does it in any way misrepresent the constituent\\n__materials._\\n----- ---- - - - - - - - - - Should you have any questions or require additional information, please do not hesitate to\\ncontact our office.\\nSincerely,\\n\\nC.J. Erickson\\n\\ncc:\\n\\nMJJ Brilliant Jewelers\\n\\n\\x0c'","created_timestamp":"May 29, 2012","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/letter-reenah-l.kim-staff-attorney-division-enforcement-bureau-consumer-protection\/120807mjjbrilliantjewelersopinion.pdf"}
{"text":"b'UNITED STATES OF AMERICA\\n\\nFEDERAL TRADE COMMISSION\\nWASHINGTON, D.C. 20580\\n\\nDivision of Marketing Practices\\n~\\nCraig Tregillus\\nctregillus@ftc.gov\\n\\nDirect Dial: (202) 326-2970\\nFacsimile: (202) 326-3395\\n\\nDecember 21, 2011\\nMs. Lynne Nelson, Compliance and Education Manager\\nOregon Mortuary & Cemetery Board\\n800 Oregon St., #430\\nPortland, OR 97232\\nDear Ms. Nelson:\\nYou have asked whether the Funeral Rule permits a funeral home to include a nondeclinable charge on its General Price List and Statement of Funeral Goods and Services Selected\\nfor disinfecting, washing and dressing remains in connection with an \\xe2\\x80\\x9cidentification viewing\\xe2\\x80\\x9d when\\nstate law does not require such a viewing. The purpose of this viewing is for a family member to\\nconfirm the identity of the deceased prior to direct cremation or immediate burial of the remains.\\nSection 453.4(b)(1)(ii) of the Rule prohibits a funeral provider from charging \\xe2\\x80\\x9cany fee as a\\ncondition to furnishing any funeral goods or funeral services to a person arranging a funeral other\\nthan the fees for (1) services of funeral director and staff, permitted by \\xc2\\xa7 453.2(b)(4)(iii)(C) (the\\n\\xe2\\x80\\x9cbasic services fee\\xe2\\x80\\x9d); (2) other funeral services and funeral goods selected by the purchaser; and (3)\\nother funeral goods or services required to be purchased, as explained on the itemized statement in\\naccordance with \\xc2\\xa7 453.3(d)(2).\\xe2\\x80\\x9d1 Section 453.2(b)(4)(iv) emphasizes that the basic services fee \\xe2\\x80\\x9cis\\nthe only funeral provider fee for services, facilities or unallocated overhead permitted by this part to\\nbe non-declinable, unless otherwise required by law.\\xe2\\x80\\x9d2\\nSection 453.3(d)(2), in turn, requires a funeral provider to \\xe2\\x80\\x9cidentify and briefly describe in\\nwriting on the statement of funeral goods and services selected . . . any legal, cemetery, or\\ncrematory requirement which the funeral provider represents to persons as compelling the purchase\\nof funeral goods or funeral services for the funeral which that person is arranging.\\xe2\\x80\\x9d3 This\\naffirmative disclosure is required by the Rule to prevent any misrepresentation prohibited by\\nSection 453.3(d)(1) \\xe2\\x80\\x9cthat federal, state or local laws, or particular cemeteries or crematories, require\\nthe purchase of any funeral goods or funeral services when such is not the case.\\xe2\\x80\\x9d4\\n\\n1\\n\\n16 C.F.R. \\xc2\\xa7 453.4(b)(1)(ii).\\n\\n2\\n\\n16 C.F.R. \\xc2\\xa7 453.2(b)(4)(iv).\\n\\n3\\n\\n16 C.F.R. \\xc2\\xa7 453.3(d)(2).\\n\\n4\\n\\n16 C.F.R. \\xc2\\xa7 453.3(d)(1).\\n\\n\\x0cMs. Lynne Nelson\\nPage 2 of 3\\n\\nThese provisions clearly prohibit a second, non-declinable fee for any purpose, including\\nan identification viewing, unless applicable law or the particular cemetery or crematory to be\\nused imposes such a requirement.5 As we understand your inquiry, no such external requirement\\nexists that would permit charges for disinfecting, washing and dressing remains in connection with\\nan identification viewing before a direct cremation or immediate burial.6\\nThe National Funeral Directors Association argues that a funeral provider should be able to\\ncharge a non-declinable fee for disinfecting, washing and dressing remains in connection with an\\nidentification viewing before a direct cremation or immediate burial because it is a \\xe2\\x80\\x9cpractical\\nnecessity\\xe2\\x80\\x9d for funeral providers to protect themselves from liability for cremating or immediately\\nburying the wrong body, or because it would be \\xe2\\x80\\x9cexcessively burdensome\\xe2\\x80\\x9d to be prevented from\\ndoing so.7 We do not find these arguments persuasive given the ready availability of reasonable\\nalternatives to such a requirement.8\\nFor example, a funeral provider could protect itself from liability in a variety of ways\\ndepending on the circumstances, including providing families with a digital photograph of the\\ndeceased for identification purposes,9 requiring families to provide a recent photograph to permit\\n\\n5\\n\\nStaff has previously stated that a non-declinable charge for an identification viewing\\nwould likely violate Section 453.4(b)(1) of the Rule if not required by law. Staff Opinion 97-4\\n(Oct. 31, 1997) available at http:\/\/www.ftc.gov\/ftc\/funerals\/opinions\/opinion97-4.pdf.\\n6\\n\\nThis opinion does not address the situation in many states and localities where a law,\\nregulation, or requirement of a cemetery or crematory imposes a duty on the funeral provider to\\nconduct an identification viewing.\\n7\\n\\nSection 453.4(b)(2)(ii) states that a funeral provider may \\xe2\\x80\\x9cfail[] to comply with a request\\nfor a combination of goods or services which would be impossible, impractical, or excessively\\nburdensome to provide.\\xe2\\x80\\x9d16 C.F.R. \\xc2\\xa7 453.4(b)(2)(ii). The Final Staff Compliance Guidelines for the\\noriginal Rule read this provision to allow a funeral provider to require and charge for embalming \\xe2\\x80\\x93\\neven in the absence of any state law embalming requirement \\xe2\\x80\\x93 for a funeral with a formal public\\nviewing in hot weather because such a viewing would be impractical absent the availability of\\nreasonable alternatives, such as refrigeration or the use of a sealed casket. 50 Fed. Reg. 28062,\\n28072-73 (July 9, 1985); see also FTC, Complying with the Funeral Rule (June 2004) 24, available\\nat http:\/\/business.ftc.gov\/documents\/bus05-complying-funeral-rule.pdf.\\n8\\n\\nAlthough the Rule does not address identification practices, the availability of a variety of\\nreasonable identification alternatives is highly relevant to the issues of practical necessity and\\nexcessive burden.\\n9\\n\\nThe NFDA and other experts have acknowledged that a digital photograph of the decedent\\nthat is positively identified by a family member is sufficient to protect a funeral provider from\\nliability for negligence.\\n\\n\\x0cMs. Lynne Nelson\\nPage 3 of 3\\nemployees to conduct and document the identification,10 or securing an identification waiver and\\nindemnification from family members.11 The availability of such alternatives undermines any\\nargument that disinfecting, washing and dressing remains in connection with an identification\\nviewing before a direct cremation or immediate burial is a practical necessity. For the same reason,\\nthe Rule prohibition of a separate non-declinable charge for those services cannot be excessively\\nburdensome.12\\nIt is therefore staff\\xe2\\x80\\x99s opinion that under the Funeral Rule a funeral provider may not require\\nand impose a separate special charge for disinfecting, washing and dressing remains in connection\\nwith an identification viewing before a direct cremation or immediate burial absent a state law,\\ncemetery or crematory requirement that is disclosed in writing on the provider\\xe2\\x80\\x99s statement of\\nfuneral goods and services selected. We note, however, that nothing in the Rule prevents a funeral\\nprovider from offering and charging clients for services that go beyond an identification viewing,\\nsuch as a private family viewing rather than a formal public viewing, so long as that service is\\nentirely optional and listed on the provider\\xe2\\x80\\x99s General Price List.\\nAs you know, the views expressed in this letter are those of the FTC staff. They have not\\nbeen reviewed, approved, or adopted by the Commission, and they are not binding on the\\nCommission or any individual Commissioner. However, they do reflect the views of FTC staff\\ncharged with enforcement of the Funeral Rule. Staff Funeral Rule opinions are now routinely\\nposted on the FTC website at http:\/\/business.ftc.gov\/content\/funeral-rule-opinions.\\nSincerely,\\n\/s\/\\nCraig Tregillus\\nFuneral Rule Coordinator\\n(Revised: 12\/18\/12)\\n10\\n\\nThis alternative may suffice, for example, in cases where there are readily identifiable\\ndistinguishing features such as scars or tattoos.\\n11\\n\\nA waiver and indemnification may be sufficient whenever a family member is present\\nwith the deceased at the time of removal.\\n12\\n\\nNothing in the Rule prevents funeral providers from adding the cost of verifying and\\ndocumenting the identity of the deceased before a direct cremation or immediate burial to the basic\\nservices fee included in their prices for those two specialized services because identification is\\nequally important to \\xe2\\x80\\x9cvirtually all,\\xe2\\x80\\x9d if not all, of those two services. See Staff Opinion 07-2 (Mar.\\n21, 2007) at 2, available at http:\/\/www.ftc.gov\/ftc\/funerals\/opinions\/opinion07-2.pdf. Staff has\\npreviously determined that providers may reduce their standard basic services fee for direct\\ncremation and immediate burial to reflect the proportionate reduction for each of those services in\\nthe actual professional services they provide and the accompanying overhead. Staff Opinion 09-6\\n(Nov. 24, 2009), available at http:\/\/ftc.gov\/bcp\/edu\/microsites\/funerals\/opinions\/opinion09-6.pdf.\\nThus, a funeral provider may recover its identification costs simply by adding them to the reduced\\nbasic services fee that it includes in its prices for direct cremation and immediate burial.\\n\\n\\x0c\\x0c'","created_timestamp":"December 21, 2011","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/opinion-11-1\/opinion11-1.pdf"}
{"text":"b\"UNITED STATES OF AMERICA\\n\\nFEDERAL TRADE COMMISSION\\nWASHINGTON, D.C. 20580\\nBureau of Competition\\nMichael Bloom\\nAssistant Director for Policy & Coordination\\nDirect Dial\\n(202) 326-2475\\n\\nSeptember 15, 2010\\nMs. Joanne Lewers\\nDrinker Biddle & Reath LLP\\n1500 K St. N.W.\\nWashington, DC 20005\\nDear Ms. Lewers:\\nThis letter responds to your request for a staff Advisory Opinion on behalf of the Rx-360\\nInternational Pharmaceutical Supply Chain Consortium (\\xe2\\x80\\x9cRx-360\\xe2\\x80\\x9d). 1 Rx-360 seeks guidance\\nconcerning the law enforcement intentions of the Federal Trade Commission\\xe2\\x80\\x99s Bureau of\\nCompetition (\\xe2\\x80\\x9cBC\\xe2\\x80\\x9d) with respect to Rx-360\\xe2\\x80\\x99s proposed implementation of two supplier audit\\nprograms, the Rx-360 Audit Sharing Program and the Rx-360 Joint Auditing Program. Under\\neach of these programs, pharmaceutical manufacturers will be able to share information about\\nthe quality and safety of ingredients purchased from common suppliers (\\xe2\\x80\\x9cauditees\\xe2\\x80\\x9d). The\\nRx-360 Joint Auditing Program additionally will permit manufacturers to share the costs of\\nsponsoring quality and safety audits of common suppliers. Because it appears that the audit\\nprograms (1) do not require exchanges of competitively significant information, (2) contain\\nprotections to reduce Rx-360 members\\xe2\\x80\\x99 ability to use the programs for anticompetitive ends, (3)\\nprotect auditees from concerted misuse of the audit programs, and (4) are intended and likely to\\npromote efficiency, quality, and safety, FTC staff has no present intention to recommend to the\\nCommission that it challenge the implementation of either program.\\nIn forming this intention, we relied entirely on a review of the written materials and other\\nrepresentations you have given to FTC staff. Should there be information that we are unaware of\\nthat qualifies, modifies, or contradicts any of these materials or representations or that calls in to\\nquestion the conclusions we have drawn from them, or should the proposed activities materially\\nchange in the future, we may change our law enforcement recommendation accordingly.\\nSummary of Representations and Written Materials\\nWe understand that Rx-360 is a not-for-profit international consortium created by\\n\\n1\\n\\nLetter from Joanne Lewers, Counsel to Rx-360, to Donald S. Clark, Secretary of the\\nCommission, requesting an FTC staff Advisory Opinion (July 26, 2010).\\n1\\n\\n\\x0cmembers of the biotech and pharmaceutical industries and incorporated in the Commonwealth of\\nPennsylvania. Its mission, as you describe it, is to protect patient safety by assuring the quality\\nand safety of the supply chain, including the authenticity of materials within the supply chain.\\nAccording to your request letter, globalization of distribution for both drug components\\xe2\\x80\\x94\\nsuch as raw materials, active pharmaceutical ingredients (\\xe2\\x80\\x9cAPIs\\xe2\\x80\\x9d), and excipient ingredients\\xe2\\x80\\x94\\nand finished products has provided opportunities for the introduction of counterfeited,\\nadulterated, and contaminated materials. In turn, the growth and globalization of the\\npharmaceutical supply chain presents a challenge for manufacturers to monitor the quality and\\nsafety of production at their supplier sites, which for any given drug manufacturer may number in\\nthe hundreds or even thousands around the world.\\nYou state that FDA regulations and guidance require pharmaceutical manufacturers either\\nto perform on-site audits of suppliers or to test all lots of components shipped to a manufacturer\\nto ensure that suppliers meet the necessary standards for providing safe, high-quality materials.\\nAudits may be performed by a pharmaceutical manufacturer\\xe2\\x80\\x99s in-house auditors or by third-party\\nauditors hired by the pharmaceutical manufacturer. These audits focus on the quality, safety, and\\nauthenticity of ingredients in the pharmaceutical supply chain; they are not, and should be\\ndistinguished from, financial audits.\\nWe understand that primary responsibility for ensuring the quality and safety of\\npharmaceutical components rests with the finished product manufacturers. In this regard, drug\\nmanufacturers follow a risk-based approach to auditing, meaning that sites generally are audited\\nonce every several years. Sites that are deemed a \\xe2\\x80\\x9clow risk\\xe2\\x80\\x9d may be audited less often. Some\\nsuppliers, however, may receive a multitude of requests from finished product manufacturers to\\nconduct audits, many of which may be duplicative. As a result, some suppliers may spend\\nsignificant effort and resources making their facilities available for audits of facilities and\\nprocesses that may have only recently been examined by other manufacturers.\\nYou state that Rx-360 was formed in 2009 to provide a more cost-effective means of\\nconducting audits and using audit data. You further state that membership in Rx-360 is open to\\nany entity whose activities relate to the research, development, or manufacture of pharmaceutical\\nor biotechnology products. These include research-based pharmaceutical companies, generic\\npharmaceutical companies, biotechnology companies, and suppliers of ingredients, components,\\nand services to the pharmaceutical and biotechnology industries. Auditors and consultants are\\npermitted to participate in some Rx-360 Working Groups as \\xe2\\x80\\x9cObservers,\\xe2\\x80\\x9d assisting in the\\ndevelopment of Rx-360 standards. To avoid conflicts of interest, they will not be permitted to\\nparticipate in some other activities, such as the Auditor Qualification Working Group, which will\\nselect auditors for assignments. 2\\n\\n2\\n\\nRepresentations made by Joanne Lewers, Counsel to Rx-360, via e-mail to Theodore\\nGebhard (August 10, 2010).\\n2\\n\\n\\x0cAccording to your request letter, Rx-360 proposes to:\\no Share publicly-available information on proposed or new legislation and\\nregulation that impacts the pharmaceutical supply chain;\\no Share publicly-available information on counterfeits, cargo thefts, and adulterated\\nproducts in the pharmaceutical supply chain;\\no Develop voluntary standards for assuring the quality, safety, and authenticity of\\nsupplies and suppliers;\\no Develop and implement audit standards and audit training and certification\\nprograms;\\no Create or obtain the infrastructure necessary to share data regarding quality,\\nsafety, and authenticity of supplies and suppliers that could adversely impact\\npatient health or welfare; and\\no Fund the further development of new technologies for securing and detecting\\nadulteration in the supply chain.\\nYou state that these activities will require the sharing of information already within the\\npublic domain. But you further state that the activities will also require the sharing of certain\\nnon-public information\\xe2\\x80\\x94subject to certain confidentiality obligations (summarized below).\\nThus, Rx-360 will become a clearinghouse for both public and non-public information related to\\nthe global pharmaceutical supply chain.\\nThe Proposed Rx-360 Audit Programs\\nRx-360 intends to implement two audit programs. The Rx-360 Audit Sharing Program\\nwill allow Rx-360 members to share existing supplier quality and safety audits conducted by\\nRx-360 members or on their behalf. The Rx-360 Joint Auditing Program will allow Rx-360\\nmembers to conduct joint quality audits of pharmaceutical suppliers going forward.\\n(1) Rx-360 Audit Sharing Program\\nWe understand that participation in the Rx-360 Audit Sharing Program is entirely\\nvoluntary. Existing audit reports will be shared only following submission of the audit report to\\nRx-360 by the audit sponsor and with the consent of the audited supplier (the \\xe2\\x80\\x9cauditee\\xe2\\x80\\x9d).\\nProgram participants will be required to execute a confidentiality agreement with Rx-360 to\\nprotect each audited supplier from unwarranted disclosure of its confidential and proprietary\\ninformation. You have included a copy of that agreement in Appendix C of your request letter.\\nFurther, each existing audit report will be redacted by the auditee to protect trade secrets,\\nconfidential business information, and other competitively sensitive information. Redaction will\\nfollow the Rx-360 audit sharing redaction policy as set out in Appendix D to your request letter.\\nThe redacted reports will then be provided to the Rx-360 Secretariat. Once the Secretariat\\ndetermines that the report is appropriately redacted, the Secretariat will enter the audit report into\\n3\\n\\n\\x0ca secure database and set access permissions so that only Rx-360 members authorized by the\\nauditee can view the report. The report will be blinded as to audit sponsor, and there will be no\\nway for an Rx-360 member to identify which other members have been given access to the\\nreport. Audit reports will remain accessible to authorized members for up to 48 months from the\\ndate of the audit. At present, the duties of the Secretariat are performed by outside legal counsel.\\nYou state that the redacted audit reports may be used by those permitted access to help\\nmake unilateral decisions about which suppliers to select. This process is similar to what many\\ncompanies now accomplish through use of vendor questionnaires.\\n(2) Rx-360 Joint Auditing Program\\nWe understand that under the Rx-360 Joint Auditing Program, one or more Rx-360\\nmembers would be able to request that the Consortium sponsor the audit of a particular supplier.\\nYou describe the procedures for development and execution of audit plans in your request letter\\nand appendices, especially Appendices G and H, and other correspondence. In brief, you explain\\nthat an audit includes meetings with auditee management and other pertinent personnel, on-site\\nobservation of the auditee\\xe2\\x80\\x99s facilities and operations, and review of the auditee\\xe2\\x80\\x99s records and\\nprocedures. You further state that an audit focuses on such things as materials controls and\\nsupply chain security, calibration and validation of critical equipment, methods, and processes,\\nmanufacturing processes, and documentation and records systems. 3\\nYou state that the audit process begins when an individual Rx-360 member submits a\\nrequest to the Secretariat for a particular audit to be conducted. The Secretariat then surveys the\\nRx-360 membership to determine whether other members want to act as joint sponsors of the\\naudit. The identity of the original requesting sponsor and other participating sponsors initially\\nwould be known only to the Secretariat. The target supplier would then be contacted to request\\nan audit. At that time, the names of the requesting firms would be disclosed to the supplier. The\\nsupplier may either agree or decline to be audited. The supplier may also exclude any requesting\\ncompany from participating as a joint sponsor.\\nAccording to your letter, a third-party auditing firm would be engaged to conduct the\\naudit. The third-party auditor will be selected on the basis of objective minimum requirements.\\nThese selection standards would include, for example, an auditor\\xe2\\x80\\x99s prior experience, knowledge\\nof pertinent regulatory and best-practices requirements, and ability to communicate in written\\nand spoken English. Other minimum criteria are set out in Appendix F. The services agreement\\nwith the auditor will require that, among other things, the auditor maintain the confidentiality of\\ninformation learned in the course of performing services. The identity of each member\\ninterested in auditing a particular supplier would not be disclosed to other companies interested\\nin auditing that supplier.\\nWe understand that after conducting the audit, the auditor will categorize each of its\\n\\n3\\n\\nRepresentations made by Joanne Lewers, Counsel to Rx-360, via e-mail to Theodore\\nGebhard (August 11, 2010).\\n4\\n\\n\\x0cobservations as either \\xe2\\x80\\x9ccritical\\xe2\\x80\\x9d or \\xe2\\x80\\x9cother.\\xe2\\x80\\x9d A critical observation, as defined by Rx-360,\\nindicates a system failure that has produced or creates a significant risk of producing a product\\nthat is harmful to consumers or that may adversely affect the safety, identity, strength, or purity\\nof the product. You explain in your letter that critical observations require immediate corrective\\naction by the supplier, and will be immediately reported to the auditee and the audit sponsors\\xe2\\x80\\x94\\neven prior to issuance of a draft audit report.\\nFollowing an oral review of its findings with the supplier, the auditor will prepare a draft\\naudit report for review by the audit sponsors. The auditor will send the draft audit report to the\\nSecretariat, who in turn will forward a copy to each of the audit sponsors. You represent that to\\nensure fairness, the auditee will be permitted to contest the accuracy of any observations in the\\ndraft audit report, including critical observations. Resolution of disputes in this regard will be\\nmade by a decision of the majority of the joint sponsors of the audit. Those decisions will also\\ndetermine what is ultimately included in the final audit report and posted into the Rx-360\\ndatabase.\\nYou state that if the audit report identifies any critical observations, the Rx-360\\nSecretariat will choose a \\xe2\\x80\\x9clead sponsor\\xe2\\x80\\x9d to follow-up on implementation of corrective actions\\nwith the audited supplier. The lead sponsor will report its findings concerning corrective action\\nto the Secretariat, who in turn will report them to each of the other sponsors. Notwithstanding\\nthe above, Rx-360 will not approve or disqualify any supplier based on the findings of a joint\\naudit. Instead, each Rx-360 member that participates in a joint audit will independently utilize\\nthe audit findings. Each sponsor retains the right to decide on its own whether an observation\\nhas been properly classified as \\xe2\\x80\\x9ccritical.\\xe2\\x80\\x9d And each individual sponsor will be free to pursue\\ndirectly with the supplier any corrective actions it deems necessary.\\nYou explain that, at all times, the auditee will determine which Rx-360 members may\\nobtain access to the audit data. The auditee even may deny access to the audit report to one or\\nmore of the joint sponsors\\xe2\\x80\\x94an outcome considered unlikely except where the auditee\\ndetermines that a joint sponsor is to some extent a competitor of the auditee. Once the final audit\\nis completed and posted on the Rx-360 database, other members of Rx-360 will be able to\\npurchase access to it, again provided the auditee agrees to allow access to such companies. We\\nunderstand, however, that other suppliers will not have access to an audited supplier\\xe2\\x80\\x99s report.\\nYou also state that the Rx-360 programs are not the only means by which audits will be\\nconducted going forward. Instead, the Rx-360 programs are merely options for manufacturers to\\nconsider as part of their audit process. For example, members retain the option to conduct audits\\noutside of the Rx-360 program framework.\\nYou submit that none of the information that will be shared relates to costs or prices.\\nFurthermore, as a safeguard to ensure that there is no sharing of competitively significant\\ninformation, the Rx-360 Secretariat will review audit reports before they are shared to affirm that\\nany information regarding costs, product specifications, quantities, and any other information\\nthat may be considered competitively significant has been redacted from the report.\\n\\n5\\n\\n\\x0cFinally, you state that the Rx-360 Joint Auditing Program is expected to enable\\nmanufacturers and suppliers to achieve efficiencies by reducing costly, duplicative, and\\ndisruptive audits at common suppliers. These efficiencies, in turn, will enable manufacturers to\\nfocus their auditing resources on (1) other suppliers that produce product-specific components,\\n(2) new suppliers, and (3) suppliers that the manufacturer may not have previously been able to\\naudit in the past to the desired frequency. Suppliers also may enjoy cost savings insofar as the\\nnumber of on-site audits of their facilities is reduced.\\nAnalysis\\nThe Rx-360 audit programs feature the sharing of information among members, some or\\nall of whom may be competitors. 4 The exchange of competitively significant information among\\ncompetitors may facilitate anticompetitive ends, such as improving the ability of rivals to reach a\\nconsensus to limit competition. Group behavior by downstream firms, as here, also raises the\\npossibility of anticompetitive concerted action on the part of manufacturers against one or more\\nupstream suppliers. It is appropriate therefore to consider the risk that Rx-360\\xe2\\x80\\x99s proposed audit\\nprograms pose in respect to these possibilities. In so doing, we conclude that they do not raise\\nsignificant risk.\\nUnder the antitrust laws, the legality of information exchanges among competitors is\\ngoverned by the rule of reason. The rule of reason balances the potential for competitive harm\\nagainst efficiencies or other procompetitive effects, if any, that the information exchange\\ngenerates. 5 Among other factors, a rule of reason analysis may inquire into market structure and\\nthe nature of the exchanged information to assess whether the exchange is likely to reduce the\\nvigor of competition. 6 A rule of reason analysis, however, need not always go so far as to\\n\\n4\\n\\nWithout first performing a formal market definition exercise it is not possible to know\\nwhether or to what extent Rx-360 members are actual competitors in one or more relevant U.S.\\nmarkets. For purposes of this analysis, we assume that the members are competitors, at least\\nrespecting some relevant U.S. pharmaceutical markets.\\n5\\n\\nUnited States v. United States Gypsum Co., 438 U.S. 422, 441 n.16 (1978) (information\\nexchanges among competitors do not always produce anticompetitive effects, but can also have\\nprocompetitive consequences by increasing efficiency. Thus, such exchanges\\xe2\\x80\\x94when not\\nevidence of actual agreements to limit competition\\xe2\\x80\\x94should be subject to the rule of reason).\\n6\\n\\nId. See also United States v. Container Corp., 393 U.S. 333 (1969), where the Supreme\\nCourt condemned a price exchange agreement, without detailed proof of actual market effects,\\nlargely because of the nature of the information exchanged, the structure of the market, and the\\nabsence of a benign justification for the price information exchange.\\nThe Bureau\\xe2\\x80\\x99s analytical framework for evaluating agreements among competitors to\\nachieve joint goals is set out in the FTC\/DOJ Guidelines for Collaborations Among Competitors\\n(2000). Specifically, except where an agreement among competitors is per se unlawful, the\\nagencies ordinarily will not challenge collaborations where the effect is competitively benign or,\\non balance, procompetitive.\\n\\n6\\n\\n\\x0crequire a full scale market definition exercise. 7 Rather, as the Commission\\xe2\\x80\\x99s Polygram opinion\\nestablishes, under some circumstances it is appropriate to perform a \\xe2\\x80\\x9ctruncated rule of reason\\xe2\\x80\\x9d or\\n\\xe2\\x80\\x9cquick look\\xe2\\x80\\x9d in which the Commission considers the capacity of the conduct at issue to facilitate\\ncompetitive harm against its tendency or ability to further plausible and cognizable\\nprocompetitive ends, such as reducing costs. 8\\nBased on the information that you have provided us and as summarized above, it does not\\nappear that the Rx-360 audit programs involve practices of the kind that appear likely, even\\nabsent an efficiency justification, to restrict or facilitate restriction of competition and decrease\\noutput in any relevant market. To the contrary, the shared information may permit Rx-360\\nmembers to achieve cognizable efficiencies redounding to the public\\xe2\\x80\\x99s benefit. Our assessment\\nis based on a number of factors.\\nFirst, the goals of the audit programs do not appear to be either directly or indirectly\\nanticompetitive. Neither do they require exchanges of information about potentially\\ncompetitively significant parameters such as price, output rates, costs, or capacity. 9 Given the\\nabsence of information exchanges respecting a significant competitive parameter, Rx-360\\nmember collaborative efforts are not likely to facilitate marketplace coordination that limits\\ncompetitive vigor. 10\\nSecond, your procedures appear to contain several safeguards that further lessen risks of\\ncompetitive harm. For example, the identity of audit sponsors will be protected, even from each\\nother; audit reports will be redacted to exclude trade secrets, confidential business information,\\nand the audit sponsor\\xe2\\x80\\x99s name; the Rx-360 database will contain only those audit reports that both\\nthe audit sponsor(s) and the auditee have agreed to disclose to members on an individual basis;\\neach Rx-360 member that participates in a joint audit will independently utilize the audit\\nfindings; participation in Rx-360 is voluntary, and all members retain the option to sponsor\\naudits of suppliers independently of Rx-360; and outside legal counsel to Rx-360 will monitor,\\non an ongoing basis, members\\xe2\\x80\\x99 compliance with Rx-360\\xe2\\x80\\x99s antitrust \\xe2\\x80\\x9cPolicy & Guidance,\\xe2\\x80\\x9d a copy\\nof which you have provided with your request in Appendix B. Each of these features cabins the\\n\\n7\\n\\nThe FTC\/DOJ Horizontal Merger Guidelines provide a thorough description of a full\\nscale market definition exercise. See Horizontal Merger Guidelines: U.S. Department of Justice\\nand Federal Trade Commission (August 19, 2010),\\nhttp:\/\/www.ftc.gov\/os\/2010\/08\/100819hmg.pdf\\n8\\n\\nPolygram Holdings, Inc. 136 F.T.C. Decisions 310 (2003) (guided by the Supreme\\nCourt\\xe2\\x80\\x99s decision in California Dental Ass\\xe2\\x80\\x99n v. FTC, 526 U.S. 756 (1999)).\\n\\n9\\n\\nYour request letter states that neither the Audit Sharing Program nor the Joint Audit\\nProgram will require the obtaining or sharing of competitively significant data such as prices,\\noutput rates, costs, or other dimensions on which Rx-360 members compete in the marketplace.\\n10\\n\\nSee Section 3 of the Collaboration Guidelines, esp. section 3.31(b).\\n7\\n\\n\\x0caudit programs in ways that appear to reduce members\\xe2\\x80\\x99 ability to use the programs for\\nanticompetitive ends. 11\\nThird, auditees appear to be protected from possible concerted misuse of the audit\\nprograms. For example, as previously noted, audit reports are not accessible to any given\\nRx-360 member from the Rx-360 database unless the auditee has provided its approval of release\\nof the audit report to that member. Additionally, the audits themselves are conducted by thirdparty audit firms selected on the basis of objective standards related to an auditor\\xe2\\x80\\x99s capacity to\\nperform quality and safety audits. After an audit is completed, Rx-360 will have no role in\\napproving or disqualifying any supplier based on an audit\\xe2\\x80\\x99s results; rather, each Rx-360 member\\nwill render its own judgment on the audit report and determine whether the auditee needs to\\nmake adjustments in order to maintain a supply relationship with the member.\\nFourth and finally, there appear to be cognizable cost-savings associated with the audit\\nprograms, as well as consumer benefits. It appears that the Joint Audit Program will enable\\nmanufacturers to reduce the costs of duplicative audits at common suppliers and more\\nproductively allocate audit resources. For example, the Joint Audit Programs may allow\\nindividual manufacturers to refocus their resources on suppliers that produce product-specific\\ncomponents for those individual manufacturers. Suppliers too could enjoy cost savings by dint\\nof fewer independently-sponsored on-site audits. These savings, or at least some portion of\\nthem, may be passed through the pharmaceutical supply chain to consumers. In addition,\\nconsumers might be better assured of the quality and safety of the components and processes\\nused to manufacture pharmaceuticals.\\nConclusion\\nOn the basis of these features, FTC staff concludes that the Rx-360 audit programs likely\\ndo not raise significant competitive concerns. Staff believes that the nature of the shared data is\\nlikely competitively benign and, in any event, the programs are sufficiently cabined in other\\nrespects to eliminate substantially any risk that the shared data would facilitate anticompetitive\\neffects in either output or input markets. The programs appear, moreover, to have important,\\ncognizable cost-saving and safety enhancing features. For these reasons, BC staff has no present\\nintention to recommend that the Commission undertake an enforcement action against the\\nRx-360 audit programs upon their implementation. This opinion of FTC staff is predicated on\\nthe accuracy of the information that you have provided to us. In accordance with normal\\npractice, the Bureau of Competition reserves the right to reconsider the questions involved and,\\nwith notice to the requesting party, to rescind the opinion if actual conduct respecting the Rx-360\\naudit programs proves to be anticompetitive in any purpose or effect or if facts change\\nsignificantly in the future such that it would be in the public interest to bring an enforcement\\naction.\\n\\n11\\n\\nFor example, retention of independent decision-making lessens concerns about the\\npotential for competitive harm. See esp. section 3.34 of the Collaboration Guidelines.\\n8\\n\\n\\x0cThe views of FTC staff contained herein are provided as authorized by Rule 1.1(b) of the\\nCommission's Rules of Practice, 16 C.F.R. ' 1.1(b). Under Commission Rule 1.3(c), 16 C.F.R. '\\n1.3(c), the Commission is not bound by this staff opinion.\\nSincerely,\\n\\nMichael Bloom\\nAssistant Director for Policy & Coordination\\nBureau of Competition\\nFederal Trade Commission\\n600 Pennsylvania Ave. N.W.\\nWashington, D.C. 20580\\n\\n9\\n\\n\\x0c\"","created_timestamp":"September 15, 2010","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/rx-360-international-pharmaceutical-supply-chain-consortium\/100916bloomletter.pdf"}
{"text":"b'UNITED STATES OF AMERICA\\n\\nFEDERAL TRADE COMMISSION\\nWASHINGTON, D.C. 20580\\n\\nBureau of Competition\\n\\nAPR - 9 2010\\n\\nMichael Bloom\\nAssistant Director for Policy & Coordination\\nDirect Dial\\n(202) 326-2475\\n\\nKelly Hnatt\\nWillkie Farr & Gallagher LLP\\n787 Seventh Ave.\\nNew York, NY 10019-6069\\nDear Ms. Hnatt:\\nThis letter responds to your request for a staff Advisory Opinion concerning the law\\nenforcement intentions of the Federal Trade Commission\\'s (\"FTC\" or the \"Commission\")\\nBureau of Competition (\"BC\") with respect to the American Institute of Certified Public\\nAccountants\\' (\"AICPA\") proposed expansion of its \"independence rule.\"t For the reasons\\ndiscussed below, FTC staffhas no present intention to recommend to the FTC that it challenge\\nadoption of the expanded independence rule as it has been described to staff. This present\\nintention relies entirely on a review of the written materials you have provided to FTC staff,\\nother representations you have made, and an interview with Securities and Exchange\\nCommission (\"SEC\") officials to whom you directed FTC staff. Should there be information\\nthat we are unaware of that qualifies, modifies, or contradicts any of this information or calls in\\nto question the conclusions we have drawn from it, or should the independence rule or its\\nimplementation change in the future, we may change our law enforcement recommendation\\naccordingly.\\nSignificantly, we cannot conclude, on the facts before us, that competitive concerns with\\nrespect to AICP A\\'s expansion of its independence rule can be wholly ruled out. Application of\\nthe expanded independence rule could, at least in principle, produce anticompetitive effects in\\nsome geographic markets, and facts necessary to evaluate that possibility are lacking.\\nNonetheless, we find that the aggregate benefits of the independence rule expansion are likely to\\nbe substantial, while the anticompetitive consequences, if any, are speculative and likely to be\\nlocalized. Thus, our present intention is not to recommend a challenge to the expansion of the\\nindependence rule; however, we will be attentive to any customer complaints to the effect that\\nimplementation of the expanded rule by a specific AICP A-member network has\\nanticompetitively limited available supply of accounting services or otherwise caused\\nanti competitive outcomes. Ifwe receive well-founded complaints of that kind, they could result\\nin our recommendation to the Commission to challenge the lawfulness of specific AICP Amember networks or our reconsideration of our decision not to recommend that the Commission\\nchallenge the expanded AICP A independence rule.\\n\\n1.\\n\\nLetter from Kelly M. Hnatt to Donald S. Clark requesting an FTC staff Advisory Opinion\\n(April 2, 2010). (\"Hnatt Letter\")\\n\\n\\x0cSummary of Representations and Written Materials\\nBased on the representations you have made and the written materials you have provided,\\nwe understand the following to be accurate:\\n\\xe2\\x80\\xa2\\n\\nAICPA is a national, professional organization of certified public accountants, with\\napproximately 350,000 members.2 Nearly forty percent of AICPA\\'s members perform\\naudit services for clients. 3 Membership in AICPA is voluntary.4\\n\\n\\xe2\\x80\\xa2\\n\\nAICP A has developed a Code of Professional Conduct (\"Code\") that governs all AICP A\\nmembers. 5 The Code is interpreted and enforced by AICPA\\'s Professional Ethics\\nExecutive Committee (\"PEEC\"t A member\\'s violation of the Code may result in\\nexpulsion from the organization.?\\n\\n\\xe2\\x80\\xa2\\n\\nThe Code addresses various ethics principles relevant to the accounting profession,\\nincluding: independence, integrity, and objectivity; compliance with applicable\\nstandards; responsibilities to clients; and other matters affecting the reputation of the\\nprofession. 8\\n\\n\\xe2\\x80\\xa2\\n\\nSome of AICPA\\'s members have formed \"networks.,,9 A network is a collaborative\\nenterprise that, among other things, can assist small network member-firms to achieve\\nsome efficiencies of size and scope. 10\\n\\n\\xe2\\x80\\xa2\\n\\nAccounting networks exist in a variety of forms. 11 PEEC defines a network as an\\nassociation of entities that includes one or more firms that cooperate for the purpose of\\nenhancing the firms\\' capabilities to provide professional services and whose members\\npossess one or more of the following characteristics: common brand name; common\\n\\n2.\\n\\nHnatt Letter at 2.\\n\\n3.\\n\\nId.\\n\\n4.\\n\\nId.\\n\\n5.\\n\\nId.\\n\\n6.\\n\\nId.\\n\\n7.\\n\\nId.\\n\\n8.\\n\\nId.\\n\\n9.\\n\\nId. at 4.\\n\\n10.\\n\\nId.\\n\\nII.\\n\\nId.\\n2\\n\\n\\x0ccontrol; sharing of profits or costs; common business strategy; the sharing of significant\\nprofessional resources; and common quality control policies and procedures. 12 The\\nextent of economic integration across accounting networks can vary significantly. 13\\n\\xe2\\x80\\xa2\\n\\nThe business basis for the formation of networks is to enable AICPA members to\\ncompete more effectively by enhancing their marketing efforts and allowing them to gain\\naccess to new markets; improving the quality and efficiency of services by leveraging the\\nprofessional skills of other firms; and providing a referral network for clients that need\\nnon-attest services that their auditors cannot provide. 14 The formation of networks\\npermits smaller and medium-sized firms to compete for the business of larger\\ncompanies. 15 This business is currently dominated by the \"Big Four\" accounting firms. 16\\n\\n\\xe2\\x80\\xa2\\n\\nUnder AICPA\\'s Code, members are obligated to adhere to \"independence\" standards. 1?\\nIndependence has two components: independence of mind (also referred to as\\nindependence in fact), and independence in appearance. 18 The purpose of the\\nindependence standard is to assure that a CPA performing an audit or other attest service\\nacts with objectivity and professional skepticism when performing that service.\\nIndependence is therefore fundamental to the reliability of auditors\\' reports and to\\ninvestors\\' confidence in financial statements. 19 Reliable financial statements reduce\\ninvestor, prospective creditor, and others\\' risk with respect to evaluating the financial\\nhealth of business entities. 20\\n\\n\\xe2\\x80\\xa2\\n\\nAICPA members perform many professional services, including audit services. 21 An\\naudit of a client\\'s financial statements concludes with an opinion by the auditor on the\\nfairness of the client\\'s financial statements, in all material respects, with regard to the\\nclient\\'s financial position, results of operations, and cash flows. 22 The auditor opines\\n\\n12.\\n\\nPEEC Interpretation No. 101-17, \"Networks and Network Firms.\" See Exhibit D.\\n\\n13.\\n\\nHnatt Letter at 4.\\n\\n14.\\n\\nId. at 4.\\n\\n15.\\n\\nId.\\n\\n16.\\n\\nId.\\n\\n17.\\n\\nId. at 2.\\n\\n18.\\n\\nId. at 3.\\n\\n19.\\n\\nId.\\n\\n20.\\n\\nId. at 9.\\n\\n21.\\n\\nId. at 4.\\n\\n22.\\n\\nId. at 3.\\n\\n3\\n\\n\\x0cwhether the client\\'s financial statements are presented in conformity with generally\\naccepted accounting principles (\"GAAP,,).23 Audits are conducted in accordance with\\ngenerally accepted auditing standards (\"GAAS,,).24\\n\\xe2\\x80\\xa2\\n\\nAICPA members also perform non-audit services. 25 Non-audit services may include,\\namong other things, performing management functions; making management decisions;\\npreparing source documents used to generate the client\\'s financial statements;\\nauthorizing, executing, or consummating transactions; exercising authority on behalf of\\nthe client; having custody of client assets; serving as a director or officer of the client;\\nbeing a lender to the client; supervising client employees; and performing tax,\\nbookkeeping, payroll, or consulting services. 26\\n\\n\\xe2\\x80\\xa2\\n\\nAdherence to AICPA\\'s current independence rules generally requires that.a member\\nperforming audit services for a given client not have performed certain non-audit services\\nfor that client during the period covered by the financial statements and during the period\\nof the professional engagement (e.g., when performing the audit).27 Prohibited non-audit\\nservices include performing management functions or making management decisions for\\nthe client; preparation or review of client financial statements or other documents that\\nwould be inputs to a subsequent audit; authorizing, executing, or consummating\\ntransactions on behalf of the client; exercising authority on behalf of the client; having\\ncustody of client assets; serving as a director or officer of the client; being a non-financial\\ninstitution lender to the client; and supervising client employees. 28\\n\\n\\xe2\\x80\\xa2\\n\\nIn general, a failure of independence due to an auditor\\'s furnishing prohibited non-audit\\nservices to a client during the period covered by the financial statement or during the\\naudit cannot be purged. 29 If, however, a failure of independence would result solely from\\na prospective auditor having a financial interest in a client (e.g., where the prospective\\nauditor is an investor in or creditor of the client), the independence rule would be\\nsatisfied if the prospective auditor severed all financial interests in the client prior to\\ncommencement of the audit. 30\\n\\n23.\\n\\nId. at 3.\\n\\n24.\\n\\nId.\\n\\n25.\\n\\nId. at 4.\\n\\n26.\\n\\nId.\\n\\n27.\\n\\nId. at 6.\\n\\n28.\\n\\nId. at 6-7.\\n\\n29.\\n\\nId. at 8.\\n\\n30.\\n\\nId.\\n\\n4\\n\\n\\x0c\\xe2\\x80\\xa2\\n\\nProvided that the auditor complies with certain general requirements, the auditor may,\\nunder AICPA\\'s independence rule, provide other non-audit services such as performing\\ntax, bookkeeping, payroll, or consulting?!\\n\\n\\xe2\\x80\\xa2\\n\\nAICP A intends to amend its Code so as to apply the independence rule to member\\nnetworks. 32 As amended, the Code would require that each member firm of an\\naccounting network be independent of financial statement audit and review clients of the\\nother firms in the network. 33 Thus, a network member may provide audit or review\\nservices for a client only insofar as other network members are not providing, and did not\\nprovide, during the period covering the financial statements, related, prohibited non-audit\\nservices for that client; and may provide prohibited non-audit services for a client only\\ninsofar as no other network member is then providing audit or review services. 34 As\\namended, the independence rule is intended to address an ethical issue arising from the\\nincreasing prevalence of accounting networks, ensuring the public that a firm providing\\nan audit or review of a client\\'s financial statements will make required judgments in an\\nobjective manner without regard to how its judgments will affect the other network\\nmembers. 35\\n\\n\\xe2\\x80\\xa2\\n\\nThe proposed amended AICPA independence rule does not restrict any network member\\nfrom competing with any other network member in the offering of audit or review\\nservices where no network member is providing, or recently has provided related,\\nprohibited non-audit services to the same client; nor does it restrict any network member\\nfrom competing with any other member in the offering of non-audit services where no\\nnetwork member is then providing audit or review services. 36\\n\\n\\xe2\\x80\\xa2\\n\\nBefore taking on an audit or review engagement, a network member would have to learn\\nfrom other network members or the prospective client whether any other network\\nmember has a prohibited relationship with the prospective client. 37 Thus, prior to\\nproviding audit or review services to a new client, a network member would have to\\n\\n31.\\n\\nId. at 7-8.\\n\\n32.\\n\\nId. at 5.\\n\\n33.\\n\\nId.\\n\\n34.\\nId. \"Related prohibited non-audit services\" refers to prohibited non-audit services upon\\nwhich a provider of audit services would or might have to rely in the provision of audit services\\nin accordance with GAAS.\\n35.\\n\\nId.\\n\\n36.\\n\\nId. at 6-8.\\n\\n37.\\n\\n!d. at 8.\\n\\n5\\n\\n\\x0cdetennine that no other network member was providing, or had recently provided related,\\nprohibited non-audit services to that client; and prior to providing non-audit services to a\\nnew client, a network member would have to detennine whether any other member was\\nthen providing audit or review services to that client. 38\\n\\xe2\\x80\\xa2\\n\\nAICPA intends to issue guidance to its members urging them, in evaluating\\nindependence, to seek needed infonnation from prospective clients to the greatest extent\\nreasonably possible, and, where needed infonnation can be obtained only from other\\nnetwork finns, to ask only whether the other network finns had potentially prohibited\\nrelationships with, or provided potentially prohibited non-audit services to, the\\nprospective client. 39 The rule would not require the exchange among potentially\\ncompeting finns of any infonnation regarding a network member\\'s bids, bidding\\nstrategy, capacity to bid, pricing or pricing plans, or other competitively sensitive\\ninfonnation. 40\\n\\n\\xe2\\x80\\xa2\\n\\nThe SEC requires that publicly-traded companies file audited financial statements with\\nthe agency that have been prepared by an accounting finn that adheres to SEC\\nindependence rules. 41 The SEC also requires that broker\/dealers submit audited\\nstatements prepared by accounting finns that adhere to the SEC independence rules,\\nregardless of whether the broker\/dealer is publicly traded. 42\\n\\n\\xe2\\x80\\xa2\\n\\nThe SEC has detennined that, to be effective, the audits filed with it must be independent\\nboth in fact and in appearance. 43 The SEC independence rule thus extends to all offices\\nof an individual accounting finn, any subordinate units, and any affiliated entities,\\nincluding any joint ventures or networks, including networks as defined by PEEC, to\\nwhich the accounting finn may belong. 44\\n\\n\\xe2\\x80\\xa2\\n\\nAICP A seeks an opinion from FTC staff as to whether the application of the\\nindependence rule to networks raises significant antitrust concerns or would result in a\\n\\n38.\\n\\nId.\\n\\n39.\\n\\nId. See also Exhibit F to Hnatt Letter.\\n\\n40.\\n\\nId. See also Exhibit F to Hnatt Letter.\\n\\n41.\\n\\nInterview with SEC officials, January 20,2010.\\n\\n42.\\n\\nId.\\n\\n43.\\n\\nId.\\n\\n44.\\n\\nId.\\n6\\n\\n\\x0cstaff recommendation to the Commission that the application of the rule in such a manner\\nbe challenged. 45\\n\\nBureau of Competition Analysis\\nThe amended Code is aimed at the preservation of independence in the performance of\\naudit services by a network member. The antitrust risks, if any, that may arise from blanket\\nimplementation of the amended Code across all AICP A member networks, regardless of the\\ndegree of integration or limits on competition that may be inherent in any given individual\\nnetwork, concern the degree to which the rule potentially further limits competition at the\\nmargm.\\nAICPA members are already subject to AICPA\\'s independence rule on an individual\\nbasis. They are also subject to compliance with the SEC\\'s independence rule, both individually\\nand as part of any networks, to the extent they perform audits for publically-traded companies\\nand for broker\/dealers that will be filed with the SEC. Thus, were AICPA to amend its\\nindependence rule as proposed, the impact would be felt on accounting services for nonpublicly-traded businesses and other entities that are not required to file audited financial\\nstatements with the SEC.\\nFor these firms, application of the rule may reduce the number of AICPA members that\\nwould be able to bid for contemporaneous audit and prohibited non-audit work. Specifically,\\nonce the AICPA independence rule is expanded to cover networks, the individual members of\\nthat network may not compete for the audit work of a business during the time surrounding the\\nprovision of prohibited non-audit services to that same business by any single member of the\\nnetwork; nor may the individual members compete for the prohibited non-audit work of a\\nbusiness while any single member of the network is engaged to perform audit work for that same\\nbusiness. Such a situation could potentially significantly reduce competition in localized\\ngeographic markets in which there are few, if any, accounting competitors outside of the AICPA\\nnetwork. As a result, some local privately-held businesses seeking both audit and prohibited\\nnon-audit services could face higher bids because of the expanded independence rule.\\nAs a general matter, the FTC recognizes that collaboration among competitors can be\\npro competitive when it results in cost-saving efficiencies or creates a new competitor.\\nCollaboration, however, also may be anticompetitive if it eliminates one or more competitors or\\nreduces incentives to compete. The joint FTCIDOJ Antitrust Guidelines for Collaborations\\nAmong Competitors provide the analytical framework for determining the net competitive\\neffects of any given joint venture. 46\\n\\n45.\\n\\nHnatt Letter at 1.\\n\\n46.\\nSee FTCIDOJ, Antitrust Guidelines for Collaboration Among Competitors (April 2000).\\nSpecifically, except where an agreement among competitors is per se unlawful, the agencies\\napply the \"rule of reason\" to assess competitor collaborations. In so doing, the agencies weigh\\nany procompetitive effects of the collaboration against the potential for competitive harm. The\\nagencies generally will not challenge collaborations where the net effect is competitively benign\\nor procompetitive. Significantly, the Guidelines do not attempt to divide all collaborations into\\n7\\n\\n\\x0cEven assuming that existing AICPA member networks satisfy the \"rule of reason\" test,\\nimplementation of the expanded independence rule may, at the margin, tip the balance in the\\nother direction. On the facts provided, however, it is not possible to make that determination for\\nall potentially affected geographic markets. The analysis would depend on the number and size\\ndistribution of market participants, as well as on some measure of any integrative efficiencies\\nappertaining to any given network of AICPA members.\\nNonetheless, the potential for net competitive harm arising from expanding the AICPA\\nindependence rule to AICPA networks appears, based on the information presently available, to\\nbe small. 47 Audits of publically-traded companies are already covered by the stricter SEC\\nindependence rule. In addition, significant benefits to the capital markets, even respecting\\ninvestors in non-publicly-traded businesses, can be expected to arise from AICPA\\'s adoption of\\nan expanded independence rule to cover networks. Moreover, additional procompetitive benefits\\ncan be expected to the extent that AICP A networks are better able to compete against larger\\naccounting firms for the business of larger privately-held clients. By contrast, potential\\nanticompetitive consequences are speculative, occurring, if at all, most likely in localized\\ngeographic markets where there may be only a limited number of accounting firms available to\\ncompete for the accounting work of local businesses.\\nNetwork members seeking to comply with the expanded independence rule will need to\\nobtain select information about recent and current engagements and activities of other network\\n\\nprocompetitive or anticompetitive lists. Rather,\\nthe Agencies hope to assist businesses in assessing whether the Agencies will challenge a\\ncompetitor collaboration or any of the agreements of which it is comprised. However,\\nthese Guidelines cannot remove judgment and discretion in antitrust law enforcement.\\nThe Agencies evaluate each case in light of its own facts and apply the analytical\\nframework set forth in these Guidelines reasonable and flexibly.\\nId. at 2 (citations omitted).\\nIn California Dental Ass\\'n v. F.T.C, 526 u.S. 756 (1999), the Court observed that, in the\\n47.\\ncontext of professional services where members of the public may not possess the specialized\\nknowledge to evaluate the quality of provided services, the likelihood of net anti competitive\\neffects arising from ethical codes that otherwise restrict competition is not \"comparably\\nobvious\" relative to restrictions in non-professional services situations. Id. at 771-772. For this\\nreason, the Court held that a \"quick look\" rule-of-reason analysis is inappropriate in these\\ninstances. Id. at 780-781. On the one hand, the Court\\'s opinion suggests that AICPA\\'s\\nexpansion of its independence rule to cover networks may be a proper stand-in for lenders\\'\\n(assumed) inability to evaluate the quality of an audit of a non-publicly-traded business, thus\\nenhancing economic value. On the other hand, the Court\\'s precise holding highlights the\\ndifficulty presented here, namely our inability to do more than render a \"quick look\" judgment\\nabout the likely competitive effects of the expansion of the independence rule, given the\\nunavailability of facts required to assess the likely impact of the expanded independence rule on\\nthe lawfulness of particular networks in specific localized geographic markets.\\n\\n8\\n\\n\\x0cmembers, and they might seek this information from other network members that are their\\npotential competitors. The exchange among competitors of some kinds of information could\\nitself result in anti competitive outcomes in some markets, for example by reducing accounting\\nfirms\\' uncertainty as to the capacity or interest of other network members in competing for new\\nclients. The reduction of uncertainty as to potential rivals\\' bidding intentions may, where only\\none or a few likely viable competitors remain, permit firms to increase bid prices for affected\\naccounting services. The exchange of certain kinds of information among competitors may\\ncause anti competitive outcomes through other mechanisms as well.\\nCompliance with the expanded independence rule, however, will not require network\\nmembers to seek from other network members any information about current or future capacity\\nor bidding intentions. Moreover, in most instances a network member will be able to obtain the\\nlimited information needed to determine whether it may provide audit or prohibited non-audit\\nservices to a prospective client from the prospective client, with little or no risk to competition.\\nAICP A intends to encourage the networks to do so, further reducing any risk of information\\nsharing among network members that harms competition.\\nOn balance, FTC staff has concluded that, although, in principle, there may be instances\\nin which the expansion of the AICPA independence rule to networks reduces competition, the\\nlikelihood that the expanded rule would significantly reduce competition does not appear to be\\nhigh. By contrast, the countervailing benefits of that expansion-in enabling small- and mediumsized accounting firms to increase their effective size and scope to compete for additional\\naccounting work while ensuring the public that their audit work is untainted by auditor selfinterest-appear substantial. On that basis, Commission staff has no present intention to\\nrecommend an enforcement action were AICPA to adopt the expanded rule. Having reached this\\nconclusion, however, we note that its basis rests on incomplete facts respecting the specific\\ngeographic markets in which AICPA member networks do business. Therefore, although we do\\nnot at present intend to pursue further investigation, we also do not intend this Advisory Opinion\\nto be construed as a blanket assessment that the expansion of the rule to networks could not raise\\ncompetition concerns sufficiently great to induce future agency action. If more complete facts\\nabout individual networks come to light, or if the FTC receives specific complaints about higher\\nbidding respecting individual AICPA networks because of the implementation of the expanded\\nindependence rule, our conclusion may change. 48\\n\\nConclusion\\nBased on the above, the Bureau does not intend to recommend a law enforcement action\\nto the FTC at this time.\\nThis letter expresses the current opinion of FTC staff, and is predicated on the accuracy\\nof the information that you have provided to us. In accordance with normal practice, BC\\nreserves the right to reconsider the questions involved and, with notice to the requesting party, to\\nrescind the opinion if actual conduct in compliance with the Code proves to be anticompetitive\\n\\n48.\\nAdditional facts, in this case, does not mean \"changed\" facts. It should also be\\nunderstood that if known facts change, our conclusion could similarly be revised.\\n9\\n\\n\\x0cin any purpose or effect or if facts change significantly in the future such that it would be in the\\npublic interest to bring an enforcement action.\\nThe views of FTC staff contained herein are provided as authorized by Rule 1.1 (b) of the\\nCommission\\'s Rules of Practice, 16 C.F.R. \\xc2\\xa7 1.1 (b). Under Commission Rule 1.3(c), 16 c.F.R. \\xc2\\xa7\\n1.3(c), the FTC is not bound by this staff opinion.\\n\\nAssistant Director for Policy & Coordination\\nBureau of Competition\\nFederal Trade Commission\\n600 Pennsylvania Ave. N.W.\\nWashington, D.C. 20580\\n\\n10\\n\\n\\x0c'","created_timestamp":"April 2, 2010","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/proposed-expansion-american-institute-certified-public-accounts-independence-rule\/100409aicpastaffadvisoryopinion.pdf"}
{"text":"b'\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c'","created_timestamp":null,"downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/proposed-expansion-american-institute-certified-public-accounts-independence-rule\/100409aicpexhibits.pdf"}
{"text":"b'UN ITED STATES OF AM ERICA\\n\\nFEDERAL TRADE COMMISSION\\nW ASH IN GTO N , D .C. 20580\\n\\nD ivision of M arketing Practices\\n\\nFebruary 4, 2010\\nJoan Mullen\\nCreative Compliance Consulting\\n9505 Golf Course Lane\\nElk Grove, CA 95758\\nRequest for Advisory Opinion:\\nTransfer of Consumer-Initiated Call to Prerecorded Message\\nDear Ms. Mullen:\\nYou have requested an informal staff opinion on the applicability of the recent\\namendments to the Telemarketing Sales Rule (\\xe2\\x80\\x9cTSR\\xe2\\x80\\x9d) to calls that are transferred to a\\nprerecorded solicitation. The amendments at issue impose new restrictions on the use of\\nprerecorded messages in telemarketing. Specifically, these amendments, as of September 1,\\n2009, generally prohibit initiating an outbound telephone call that delivers a prerecorded\\nmessage to induce the purchase of any good or service unless the seller has obtained from the\\nrecipient of the call an express agreement, in writing, that evidences the willingness of the\\nrecipient of the call to receive calls that deliver prerecorded messages by or on behalf of that\\nseller and includes such person\\xe2\\x80\\x99s telephone number and signature. 16 C.F.R. \\xc2\\xa7 310.4(b)(1)(v)\\n(2009); 73 Fed. Reg. 15204 (Aug. 29, 2008). Your letter asks whether this amendment prohibits\\nuse of a prerecorded message in the follow scenario:\\nA consumer calls in to [sic] a call center with a customer service need or to\\npurchase something. At the conclusion of the primary purpose of the call the\\nconsumer is advised by a live agent to \\xe2\\x80\\x9chold the line[\\xe2\\x80\\x9d] while the call is\\ntransferred to a rewards center. The call is then transferred to an automated sales\\nline and one or more [prerecorded] \\xe2\\x80\\x9cpitches\\xe2\\x80\\x9d are made. The consumer has no\\nopportunity to give permission for the prerecorded pitches.\\nThe staff of the Federal Trade Commission has concluded that 16 C.F.R.\\n\\xc2\\xa7 310.4(b)(1)(v)(A) does not apply to the delivery of prerecorded messages in the manner\\ndescribed in your letter. The provisions on prerecorded messages in 16 C.F.R. \\xc2\\xa7 310.4(b)(1)(v)\\nrestrict initiating an \\xe2\\x80\\x9coutbound telephone call\\xe2\\x80\\x9d and such a call is defined as \\xe2\\x80\\x9ca telephone call\\ninitiated by a telemarketer to induce the purchase of goods or services or to solicit a charitable\\ncontribution.\\xe2\\x80\\x9d Id. \\xc2\\xa7 310.2(u) (italics added). In the circumstances described in your letter, the\\ncustomer initiates the telephone call and the transfer of the call that is initiated by the call center\\nis a continuation of the same telephone call. Because call was initiated by the consumer, and not\\nby a seller or telemarketer, 16 C.F.R. \\xc2\\xa7 310.4(b)(1)(v)(A) does not apply to the call.\\n\\n\\x0cJoan Mullen\\nCreative Compliance Consulting\\nRequest for Advisory Opinion\\n\\nJanuary 29,2010\\nPage 2\\n\\nWe note that in 2002, the Commission proposed modifying the definition of \"outbound\\ntelephone call\" in the Telemarketing Sales Rule so that the definition would include situations in\\nwhich a telephone call is \"transferred to a telemarketer other than the original telemarketer.\" 67\\nFed. Reg. 4491, 4500, 4541 (2002). The Commission decided not to expand the Rule\\'s\\ndefinition of \"outbound telephone call\" by adding this language. 68 Fed. Reg. 4579, 4594-95\\n(2003). After considering public comments on the proposal, the Commission observed that\\nexpanding the definition in this manner would have unintended and undesirable consequences\\nbecause it would make upselling transactions subject to all the provisions of the Telemarketing\\nSales Rule relating to outbound calls, including the calling time restrictions and national \"donot-call\" provisions. Id. In the same document, the Commission explained that the definition of\\n\"outbound telephone call\" includes situations in which the telemarketer disconnects or\\n\"abandons\" a call answered by a person without delivering a sales pitch. \"A telemarketer\\ninitiates a telephone call,\" the Commission observed, \"by causing the called consumer\\'s\\ntelephone to ring.\" 68 Fed. Reg. at 4643. These statements in the Statement of Basis and\\nPurpose accompanying the Commission\\'s adoption of the current definition of \"outbound\\ntelephone call\" reinforce our conclusion that the situation described in your letter - in which the\\ntelemarketer does not cause the consumer\\'s telephone to ring but transfers a call initiated by the\\nconsumer after the primary purpose of the call has been completed - is not an \"outbound\\ntelephone call\" and, therefore, is not subject to 16 C.F.R. \\xc2\\xa7 31 O.4(b)(1 )(v).\\nPlease be advised that this opinion is based exclusively on the information furnished in\\nyour letter and applies only to the practice described in your letter. Moreover, this opinion only\\naddresses the issue that you presented, namely the applicability of 16 C.F.R. \\xc2\\xa7 31O.4(b)(1 )(v).\\nOther provisions ofthe Telemarketing Sales Rule that are not limited to outbound telephone\\ncalls may apply to the situation that you describe. In particular, provisions of the TSR\\nconcerning \"upselling\" would apply to the telephone call that you describe, even though the call\\nis not an outbound telephone call. 16 C.F .R. \\xc2\\xa7 31 0.3(d).\\nIn addition, please be advised that the views expressed in this letter are those of the FTC\\nstaff. They have not been reviewed, approved, or adopted by the Commission, and they are not\\nbinding upon the Commission. However, they do reflect the opinions of the staff members\\ncharged with enforcement of the TSR. Staff opinions concerning the TSR are routinely posted\\non the FTC website at http:\/\/www.ftc.gov\/bcp\/telemarketing\/staffopinions.shtm.\\n\\n~~lY~\\nLois Greisman\\nAssociate Director\\nDivision of Marketing Practices\\n\\n\\x0c'","created_timestamp":"February 4, 2010","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/opinion-10-2\/opinion1002_0.pdf"}
{"text":"b'UN ITED STATES OF AM ERICA\\n\\nFEDERAL TRADE COMMISSION\\nW ASH IN GTO N , D .C. 20580\\n\\nD ivision of M arketing Practices\\nCraig Tregillus\\nctregillus@ ftc.gov\\n\\nD irect D ial: (202) 326-2970\\nFacsim ile: (202) 326-3395\\n\\nNovember 24, 2009\\nHarvey I. Lapin, Esq.\\nHarvey I. Lapin, PC\\nP.O. Box 1327\\nNorthbrook, IL 60065-1327\\nDear Mr. Lapin:\\nThis letter responds to your request for a staff opinion interpreting Section 453.4(e)(2) of\\nthe Funeral Rule, which prohibits claims representing \\xe2\\x80\\x9cthat funeral goods have protective\\nfeatures or will protect the body from gravesite substances, when such is not the case.\\xe2\\x80\\x9d1 You\\nask, in particular, whether this provision bars an advertisement by a funeral provider that\\nexpressly claims a burial vault is \\xe2\\x80\\x9cwaterproof.\\xe2\\x80\\x9d\\nThe Commission\\xe2\\x80\\x99s discussion of this provision in the Statement of Basis and Purpose\\n(\\xe2\\x80\\x9cSBP\\xe2\\x80\\x9d) for the Rule specifically cites claims that caskets and burial vaults are \\xe2\\x80\\x9cairtight,\\nwatertight, or offer special protection against the elements\\xe2\\x80\\x9d or are \\xe2\\x80\\x9cwaterproof.\\xe2\\x80\\x9d2 Although the\\nSBP thus makes it clear that Section 453.4(e)(2) applies to a claim that a casket or vault is\\n\\xe2\\x80\\x9cwaterproof,\\xe2\\x80\\x9d the prohibition only applies to such claims by funeral providers if they are untrue;\\ni.e., \\xe2\\x80\\x9cwhen such is not the case.\\xe2\\x80\\x9d The SBP points out that it is typically \\xe2\\x80\\x9cimpossible to estimate\\nhow often such claims are false, because consumers are unable to discover whether protective\\nclaims are inflated without exhuming the body.\\xe2\\x80\\x9d\\nYour request was prompted by an advertisement in which a funeral provider expressly\\nrepresents that it sells \\xe2\\x80\\x9ca quality VAULT that is water proof and has a warranty in writing\\xe2\\x80\\x9d and\\ncosts \\xe2\\x80\\x9cless than you paid for a plastic or concrete box.\\xe2\\x80\\x9d The funeral provider that placed this ad\\nmay be held liable for violating Section 453.4(e)(2) of the Rule if the claim is untrue \\xe2\\x80\\x93 even if\\nthe provider is simply repeating a representation made by the manufacturer. Any funeral\\nprovider that repeats a claim that funeral goods have protective features adopts that claim as its\\nown and can be held liable for making false or unsubstantiated claims.\\n\\n1\\n\\n2\\n\\n16 C.F.R. \\xc2\\xa7 453.3(e)(2).\\n\\n47 Fed. Reg. 42280, 42278 & n.186 (Sept. 24, 1982), available at\\nhttp:\/\/www.ftc.gov\/bcp\/rulemaking\/funeral\/funrlprac.pdf.\\n\\n\\x0cHarvey I. Lapin, Esq.\\nPage 2 of 2\\nAs you know, the views expressed in this letter are those of the FTC staff. They have not\\nbeen reviewed, approved, or adopted by the Commission, and they are not binding on the\\nCommission or any individual Commissioner. However, they do reflect the views of FTC staff\\ncharged with enforcement of the Funeral Rule. Staff Funeral Rule opinions are routinely posted\\non the FTC website at http:\/\/www.ftc.gov\/bcp\/conline\/edcams\/funerals\/staffopinions.shtm.\\nSincerely,\\n\/s\/\\nCraig Tregillus\\nFuneral Rule Coordinator\\n\\n\\x0c'","created_timestamp":"November 24, 2009","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/opinion-09-7\/opinion09-7.pdf"}
{"text":"b'UNITED STATES OF AMERICA\\n\\nFEDERAL TRADE COMMISSION\\nWASHINGTON, D.C. 20580\\n\\nDivision of Marketing Practices\\n\\nNovember 6, 2009\\nStephen F. Ruffino\\nGibney Anthony & Flaherty LLP\\n665 Fifth Avenue\\nNew York, NY 10022\\nDear Mr. Ruffino:\\nThis letter responds to your request for a staff advisory opinion regarding compliance\\nwith the Magnuson-Moss Warranty Act (\\xe2\\x80\\x9cAct\\xe2\\x80\\x9d), 15 U.S.C. \\xc2\\xa7\\xc2\\xa7 2301-2312, and the Commission\\xe2\\x80\\x99s\\nrules promulgated under that Act. You seek guidance on the Act\\xe2\\x80\\x99s application to your client\\xe2\\x80\\x99s\\none-year \\xe2\\x80\\x9cService Warranty.\\xe2\\x80\\x9d According to your letter, your client provides this service\\nwarranty after a consumer has purchased one of your client\\xe2\\x80\\x99s consumer products and\\nsubsequently has had that product serviced through one of your client\\xe2\\x80\\x99s dealers or service\\ncenters. Specifically, you ask whether this service warranty is a \\xe2\\x80\\x9cwritten warranty\\xe2\\x80\\x9d as that term\\nis defined in the Act. Based on the information you provide in your letter, and after considering\\nthe purposes of the Act, it is the staff\\xe2\\x80\\x99s opinion that the service warranty you describe is not a\\n\\xe2\\x80\\x9cwritten warranty\\xe2\\x80\\x9d under the Act or the Commission\\xe2\\x80\\x99s rules.\\nYour Client\\xe2\\x80\\x99s Course of Conduct and Proposal\\nIn your letter you indicate that your client imports and distributes a line of high-end\\nconsumer products. In connection with the sale of these products, your client offers from the\\ndate of sale a Full Two-Year Warranty. This Full Two-Year Warranty provides that in the event\\nof a malfunction arising within the warranty period, your client will remedy any defects at no\\ncost to the consumer.\\nAfter the expiration of the Full Two-Year Warranty period, consumers may choose to\\npurchase additional maintenance and service for the product in what you refer to as \\xe2\\x80\\x9cFactory\\nService.\\xe2\\x80\\x9d This Factory Service requires that the consumer take the product to an authorized\\ndealer or service center for service. You indicate that this service can often entail a full overhaul\\nof the product.\\nAfter the completion of this service, your client issues a one-year \\xe2\\x80\\x9cService Warranty\\xe2\\x80\\x9d on\\nthe serviced product, pursuant to which your client promises to remedy any defects at no cost to\\nthe consumer for one year from the date of service. You indicate that there is no additional cost\\nfor this Service Warranty.\\n\\n\\x0cMr. Stephen F. Ruffino\\nNovember 6, 2009\\nPage 2\\nYour client intends to revise its Service Warranty, but would like more flexibility in\\ndrafting the text of the document. Therefore, you seek guidance on whether this Service\\nWarranty, which accompanies the serviced consumer product, is a \\xe2\\x80\\x9cwritten warranty\\xe2\\x80\\x9d as defined\\nin the Act.\\nThe Warranty Act and Rules\\nThe Act and Commission rules impose duties on warrantors that make written warranties\\non consumer products.1 Under the Act, a \\xe2\\x80\\x9cwritten warranty\\xe2\\x80\\x9d is defined as either:\\n(A) any written affirmation of fact or written promise made in connection with the\\nsale of a consumer product by a supplier to a buyer which relates to the nature of the\\nmaterial or workmanship and affirms or promises that such material or workmanship\\nis defect free or will meet a specified level of performance over a specified period\\nof time, or\\n(B) any undertaking in writing in connection with the sale by a supplier of a\\nconsumer product to refund, repair, replace, or take other remedial action with\\nrespect to such product in the event that such product fails to meet the specifications\\nset forth in the undertaking,\\nwhich written affirmation, promise, or undertaking becomes part of the basis of the\\nbargain between a supplier and a buyer for purposes other than resale of such\\nproduct.\\n15 U.S.C. \\xc2\\xa7 2301(6) (emphasis added). The Commission rules incorporate this definition of a\\nwritten warranty.2\\nThe Act and rules specifically distinguish between a written warranty and a \\xe2\\x80\\x9cservice\\ncontract.\\xe2\\x80\\x9d A service contract is defined as a \\xe2\\x80\\x9ccontract in writing to perform, over a fixed period\\nof time or for a specified duration, services relating to the maintenance or repair (or both) of a\\nconsumer product.\\xe2\\x80\\x9d 15 U.S.C. \\xc2\\xa7 2301(8). The Commission rules expand on the distinction\\nbetween a service contract and a written warranty, providing that a written warranty \\xe2\\x80\\x9cmust be\\n\\xe2\\x80\\x98part of the basis of the bargain,\\xe2\\x80\\x99 \\xe2\\x80\\x9d meaning that it \\xe2\\x80\\x9cmust be conveyed at the time of sale of the\\nconsumer product and the consumer must not give any consideration beyond the purchase of the\\nconsumer product in order to benefit from the agreement.\\xe2\\x80\\x9d 16 C.F.R. \\xc2\\xa7 700.11(b).\\n1\\n\\nThe term \\xe2\\x80\\x9cconsumer product\\xe2\\x80\\x9d means \\xe2\\x80\\x9cany tangible personal property which is\\ndistributed in commerce and which is normally used for personal, family, or household purposes\\n(including any such property intended to be attached to or installed in any real property without\\nregard to whether it is so attached or installed).\\xe2\\x80\\x9d 15 U.S.C. \\xc2\\xa7 2301(1).\\n2\\n\\nSee 16 C.F.R. \\xc2\\xa7\\xc2\\xa7 701.1(c); 702.1(c); 703.1(c). As acknowledged in your letter, your\\nclient\\xe2\\x80\\x99s Full Two-Year Warranty is a \\xe2\\x80\\x9cwritten warranty\\xe2\\x80\\x9d under the Act and Commission rules.\\n\\n\\x0cMr. Stephen F. Ruffino\\nNovember 6, 2009\\nPage 3\\nDiscussion\\nAfter considering the plain language of the Act and the purposes of the statute, it is the\\nstaff\\xe2\\x80\\x99s opinion that the service warranty you describe would not be a \\xe2\\x80\\x9cwritten warranty\\xe2\\x80\\x9d under\\nthe Act.\\nFirst, the plain language of the Act provides that a \\xe2\\x80\\x9cwritten warranty\\xe2\\x80\\x9d must be part of the\\nbasis of the bargain and must be made \\xe2\\x80\\x9cin connection with the sale\\xe2\\x80\\x9d of a consumer product. 15\\nU.S.C. \\xc2\\xa7 2301(6). Your client\\xe2\\x80\\x99s \\xe2\\x80\\x9cservice warranty,\\xe2\\x80\\x9d however, is provided to consumers after\\nthey have purchased the consumer product and therefore forms no part of the basis of the\\nbargain.\\nSecond, the purposes of the Act would not be furthered by a determination that your\\nclient\\xe2\\x80\\x99s service warranty is a written warranty under the Act. In passing the Act, it was\\nCongress\\xe2\\x80\\x99s intent that consumers receive clear and complete information about warranty\\ncoverage prior to sale; that consumers understand fully what to expect in the event of a consumer\\nproduct failure or malfunction; and that manufacturers compete on the basis of warranty\\ncoverage. 15 U.S.C. \\xc2\\xa7 2302(a). It is the staff\\xe2\\x80\\x99s opinion that these purposes have little\\napplication in the context of your client\\xe2\\x80\\x99s service warranty.\\nYou indicate in your letter that your client\\xe2\\x80\\x99s Full Two-Year Warranty fully complies with\\nthe Act. Accordingly, consumers have presumably received complete information about\\nwarranty coverage prior to sale and understand what to expect in the event of product failure or\\nmalfunction. Therefore, the first two purposes of the Act are served by the provision of the Full\\nTwo-Year Warranty. A determination that your client\\xe2\\x80\\x99s service warranty is a written warranty\\nwould do little to further these purposes because the consumer has already received information\\nregarding warranty coverage and would have been able to use that information in making a\\npurchasing decision. Similarly, a determination that the service warranty is not a written\\nwarranty would not impact competition on the basis of warranty coverage because the consumer\\nhas already purchased the consumer product.3\\n\\n3\\n\\nMoreover, the staff\\xe2\\x80\\x99s conclusion that your client\\xe2\\x80\\x99s service warranty is not a written\\nwarranty is not altered by 16 C.F.R. \\xc2\\xa7 700.1(h), which addresses warranties on replacement\\nparts. Specifically, Rule 700.1(h) provides that \\xe2\\x80\\x9cwarranties on replacement parts and\\ncomponents used to repair consumer products are covered; warranties on services are not.\\xe2\\x80\\x9d Rule\\n700.1(h) is intended to address \\xe2\\x80\\x9caftermarket\\xe2\\x80\\x9d replacement products that are purchased by\\nconsumers, and merely indicates that where a written warranty covers both parts and services, it\\nis covered by the Act. See Curtis R. Reitz, Consumer Product Warranties Under Federal and\\nState Laws \\xc2\\xa7 13.06 (2d ed. 1987). This provision, however, does not impact the meaning of a\\n\\xe2\\x80\\x9cwritten warranty\\xe2\\x80\\x9d under the Act, nor does it alter the \\xe2\\x80\\x9cbasis of the bargain\\xe2\\x80\\x9d test.\\n\\n\\x0cMr. Stephen F. Ruffino\\nNovember 6, 2009\\nPage 4\\nConclusion\\nBased on the plain text of the Act, which requires that a \\xe2\\x80\\x9cwritten warranty\\xe2\\x80\\x9d form part of\\nthe basis of the bargain of the original sale, and because designating your client\\xe2\\x80\\x99s service\\nwarranty a \\xe2\\x80\\x9cwritten warranty\\xe2\\x80\\x9d would do little to advance the purposes of the Act, it is the staff\\xe2\\x80\\x99s\\nopinion that the service warranty you describe would not be a written warranty under the Act.\\nThe opinions and conclusions expressed in the foregoing discussion are those of\\nCommission staff only and are not attributable to, nor binding on, the Commission itself\\nor any individual Commissioner. I hope this discussion is helpful to you. If you have any further\\nquestions, please do not hesitate to contact me at (202) 326-2505.\\n\\nSincerely,\\n\\nAllyson Himelfarb\\nInvestigator\/Magnuson-Moss\\nProgram Coordinator\\n\\n\\x0c'","created_timestamp":"November 6, 2009","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/opinion-09-2\/opinion0902_0.pdf"}
{"text":"b'UN ITED STATES OF AM ERICA\\n\\nFEDERAL TRADE COMMISSION\\nW ASH IN GTO N , D .C. 20580\\n\\nD ivision of M arketing Practices\\nCraig Tregillus\\nctregillus@ ftc.gov\\n\\nD irect D ial: (202) 326-2970\\nFacsim ile: (202) 326-3395\\n\\nApril 16, 2009\\nT. Scott Gilligan, Esq.\\nGilligan Law Offices\\n3734 Eastern Avenue\\nCincinnati, OH 45226\\nDear Mr. Gilligan:\\nYou have asked for a clarification of Staff Opinion 09-1,1 because you are concerned that\\nportions of that opinion might be taken out of context and misinterpreted. You express\\nparticular misgivings about statements you believe could be read to imply that \\xe2\\x80\\x9cthe basic\\nservices fee must be the same for each of the clients of a funeral provider,\\xe2\\x80\\x9d and thus might\\nsuggest that the Funeral Rule prohibits funeral providers from providing free or nominal cost\\nfunerals for indigents and in other special cases.\\nThe point we made in Opinion 09-1 was that funeral providers must charge the same\\nbasic service fee listed on their General Price List (\\xe2\\x80\\x9cGPL\\xe2\\x80\\x9d) to clients who buy a discount\\npackage of funeral goods and services and those who do not. Only the goods and services\\nprovided in a discount package may be discounted, not the basic services fee, for the reasons\\nexplained in the Opinion.\\nIn fact, the statement from the Opinion that you cite as causing the greatest concern was\\ncarefully footnoted with an acknowledgment that funeral providers may charge lower prices for\\nspecial groups, such as indigents, infants, and memorial society members.2 The one prerequisite\\nfor charging lower prices for such special groups, as the Opinion noted, is the requirement that a\\nfuneral provider provide qualifying clients with an alternative price list. As the Compliance\\nGuide emphasizes:\\nRemember: Even if you use alternative price lists, you still must comply with all\\nRule provisions, including mandatory disclosures and itemized prices.3\\n1\\n\\nStaff Opinion 09-1 (Feb. 17, 2009).\\n\\n2\\n\\nId. at p.3, n.10, and accompanying text.\\n\\n3\\n\\nComplying with the Funeral Rule (June 2004), p. 13. See 47 Fed. Reg. 42260,\\n42299 (Sept. 24, 1982) (\\xe2\\x80\\x9cFinally, nothing in the rule will prevent funeral directors from meeting\\nany perceived social responsibility to make services available at nominal charges for welfare\\ncases or from charging special lower prices for infant deaths or other special cases.\\xe2\\x80\\x9d)\\n\\n\\x0cT. Scott Gilligan, Esq.\\nPage 2 of 2\\nYou also seek clarification that Opinion 09-1 is not meant to imply that a funeral\\nprovider is required to include the full basic services fee listed in its GPL in its fees for\\nforwarding and receipt of remains, direct cremation, and immediate burial. You are correct that\\nbecause the Opinion does not address that question, no such inference can be drawn from it.\\nThat issue has been raised in a separate request, and will be addressed in a forthcoming staff\\nopinion.\\nThe views expressed in this letter are those of the FTC staff. They have not been\\nreviewed, approved, or adopted by the Commission, and they are not binding on the Commission\\nor any individual Commissioner. However, they do reflect the views of FTC staff charged with\\nenforcement of the Funeral Rule. Staff Funeral Rule opinions are routinely posted on the FTC\\nwebsite at http:\/\/www.ftc.gov\/bcp\/conline\/edcams\/funerals\/staffopinions.shtm.\\nSincerely,\\n\/s\/\\nCraig Tregillus\\nFuneral Rule Coordinator\\n\\n\\x0c'","created_timestamp":"April 16, 2009","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/opinion-09-3\/opinion09-3.pdf"}
{"text":"b'UN ITED STATES OF AM ERICA\\n\\nFEDERAL TRADE COMMISSION\\nW ASH IN GTO N , D .C. 20580\\n\\nD ivision of M arketing Practices\\nCraig Tregillus\\nctregillus@ ftc.gov\\n\\nD irect D ial: (202) 326-2970\\nFacsim ile: (202) 326-3395\\n\\nApril 16, 2009\\nMichael P. A. Cohen, Esq.\\nPaul, Hastings, Janofsky and Walker, LLP\\n875 15 th Street, N.W.\\nWashington, DC 20005\\nDear Mr. Cohen:\\nOn behalf of Selected Independent Funeral Homes (\\xe2\\x80\\x9cSIFH\\xe2\\x80\\x9d), a professional association of\\nindependent, locally owned funeral homes, you have requested a staff opinion on the application\\nof the Funeral Rule to cemeteries. You state that many SIFH members also own cemeteries, and\\nargue that staff\\xe2\\x80\\x99s analysis in Opinion 08-1 1 of the Rule\\xe2\\x80\\x99s application to crematories \\xe2\\x80\\x9capplies with\\nequal force to cemeteries,\\xe2\\x80\\x9d and compels a conclusion that the Rule likewise applies to cemeteries.\\nAs you may know, the Commission noted when it promulgated the Rule that a cemetery\\n\\xe2\\x80\\x9cwould generally not be considered a \\xe2\\x80\\x98funeral provider\\xe2\\x80\\x99\\xe2\\x80\\x9d because it \\xe2\\x80\\x9conly arranges or conducts\\nfinal dispositions\\xe2\\x80\\x9d and \\xe2\\x80\\x9cdoes not prepare human remains for burial or other dispositions.\\xe2\\x80\\x9d 2 In\\n2008, the Commission decided not to commence a rulemaking proceeding to amend the Rule to\\ncover all cemeteries operated for profit.3 Nothing in Opinion 08-1 is inconsistent with these\\ndeterminations.\\nIn Opinion 08-1, staff noted that the Rule applies only to \\xe2\\x80\\x9cfuneral providers\\xe2\\x80\\x9d that sell or\\noffer to sell both \\xe2\\x80\\x9cfuneral goods,\\xe2\\x80\\x9d as defined by \\xc2\\xa7 453.1(h) of the Rule,4 and \\xe2\\x80\\x9cfuneral services,\\xe2\\x80\\x9d as\\ndefined by \\xc2\\xa7 453.1(j).5 We stated that if a crematory sells or offers to sell \\xe2\\x80\\x9cfuneral goods,\\xe2\\x80\\x9d such\\n\\n1\\n\\nStaff Opinion 08-1, available at http:\/\/www.ftc.gov\/bcp\/conline\/edcams\/funerals\\n\/opinions\/opinion08-1.pdf.\\n2\\n\\n47 Fed. Reg. 42260, 42285 (Sept. 24, 1982).\\n\\n3\\n\\n73 Fed. Reg. 13740, 13742 (Mar. 13, 2008). The Commission observed that under\\nthe FTC Act, 15 U.S. C. \\xc2\\xa7 45, it would have jurisdiction over for-profit cemeteries, but not over\\nnon-profit cemeteries, and that the \\xe2\\x80\\x9clopsided application of the Rule to some, but not all, cemeteries\\nwould likely prove unduly costly.\\xe2\\x80\\x9d 73 Fed. Reg. at 13744-45.\\n4\\n\\n5\\n\\n16 CFR \\xc2\\xa7 453.1(h).\\n\\n16 CFR \\xc2\\xa7 453.1(j). The definition of \\xe2\\x80\\x9cfuneral provider\\xe2\\x80\\x9d in \\xc2\\xa7 453.1(i) of the Rule\\nrequires the offer or sale of both \\xe2\\x80\\x9cfuneral goods\\xe2\\x80\\x9d and \\xe2\\x80\\x9cfuneral services.\\xe2\\x80\\x9d 16 CFR \\xc2\\xa7 453.1(i).\\n\\n\\x0cMichael P. A. Cohen, Esq.\\nPage 2 of 2\\nas urns, it would be covered by the Rule because crematories also perform \\xe2\\x80\\x9cfuneral services.\\xe2\\x80\\x9d\\nStaff\\xe2\\x80\\x99s view that crematories perform \\xe2\\x80\\x9cfuneral services\\xe2\\x80\\x9d was based, in turn, on our analysis of the\\ntwo tests prescribed by the definition of that term:\\n\\xe2\\x80\\x98Funeral services\\xe2\\x80\\x99 are any services which may be used to:\\n(1)\\n\\nCare for and prepare deceased human bodies for burial, cremation\\nor other final disposition; and\\n\\n(2)\\n\\narrange, supervise or conduct the funeral ceremony or the final\\ndisposition of deceased human remains. 6\\n\\nWhile we agree that the second element in the definition applies equally to cemeteries and\\ncrematories, because both \\xe2\\x80\\x9carrange, supervise or conduct . . . the final disposition,\\xe2\\x80\\x9d staff is not\\npersuaded that most cemeteries \\xe2\\x80\\x9ccare for and prepare deceased human bodies for burial, \\xe2\\x80\\x9das\\nrequired by the first element. Unlike cemeteries, crematories typically must refrigerate and store\\nremains for waiting periods prescribed by state law, and physically handle remains to transfer\\nthem from regular or rental caskets to flammable containers, check for and remove prosthetics,\\npacemakers, and jewelry prior to cremation, and collect the ashes when the process is completed.\\nIt cannot be said that cemeteries likewise \\xe2\\x80\\x9ccare for an prepare deceased human bodies for burial\\xe2\\x80\\x9d\\nsince they generally deal only with casketed remains.\\nWhile the Funeral Rule generally does not apply to cemeteries, there may be some\\ncircumstances in which commercial cemeteries are \\xe2\\x80\\x9cfuneral providers\\xe2\\x80\\x9d and are obliged to comply\\nwith the Rule. For example, if a commercial cemetery provides \\xe2\\x80\\x9cfuneral services\\xe2\\x80\\x9d and offers or\\nsells \\xe2\\x80\\x9cfuneral goods,\\xe2\\x80\\x9d it would be obligated to comply with the Rule.\\nAs you know, the views expressed in this letter are those of the FTC staff. They have not\\nbeen reviewed, approved, or adopted by the Commission, and they are not binding on the\\nCommission or any individual Commissioner. However, they do reflect the views of FTC staff\\ncharged with enforcement of the Funeral Rule. Staff Funeral Rule opinions are routinely posted\\non the FTC website at http:\/\/www.ftc.gov\/bcp\/conline\/edcams\/funerals\/staffopinions.shtm.\\nSincerely,\\n\/s\/\\nCraig Tregillus\\nFuneral Rule Coordinator\\n\\n6\\n\\n16 CFR \\xc2\\xa7 453.1(j)(1)-(2).\\n\\n\\x0c'","created_timestamp":"April 16, 2009","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/opinion-09-5\/opinion09-5.pdf"}
{"text":"b'UN ITED STATES OF AM ERICA\\n\\nFEDERAL TRADE COMMISSION\\nW ASH IN GTO N , D .C. 20580\\n\\nD ivision of M arketing Practices\\nCraig Tregillus\\nctregillus@ ftc.gov\\n\\nD irect D ial: (202) 326-2970\\nFacsim ile: (202) 326-3395\\n\\nMarch 18, 2009\\nMr. Mark W. Duffey, President\\nEverest Funeral Package, LLC\\n1300 Post Oak Blvd. - Suite 1210\\nHouston, TX 77056\\nDear Mr. Duffey:\\nYou have requested a staff opinion on whether the Commission\\xe2\\x80\\x99s Funeral Rule permits a\\nfuneral provider to decline to provide detailed price information in response to a telephone\\nrequest made by or on behalf of your company. The Funeral Rule is clear: funeral providers\\nmust provide price information by telephone to anyone who calls seeking such information.\\nEverest is a nationwide funeral planning and concierge service that provides its\\ncustomers with pre-need and at-need funeral planning assistance. A key feature of Everest\\xe2\\x80\\x99s\\nservices is its \\xe2\\x80\\x9cPriceFinder Report, an online tool that allows consumers to obtain comparative\\nprice information for funeral homes in their area. In order to obtain this information from the\\nmore than 20,000 funeral providers in the United States, Everest contracts with a telephone call\\ncenter that telephones each provider annually to ask for the information on its General Price List\\n(\\xe2\\x80\\x9cGPL\\xe2\\x80\\x9d).\\nSection 453.2(b)(1) of the Funeral Rule requires funeral providers to \\xe2\\x80\\x9c[t]ell persons who\\nask by telephone about the funeral provider\\xe2\\x80\\x99s offerings or prices any accurate information from\\nthe prices lists described in paragraphs (b)(2) through (4) of this section [the Casket Price List,\\nthe Outer Burial Container Price List, and the GPL] and any other readily available information\\nthat reasonably answers the question.\\xe2\\x80\\x9d1 Section 453.1(o) of the Rule defines a \\xe2\\x80\\x9cperson\\xe2\\x80\\x9d as \\xe2\\x80\\x9cany\\nindividual, partnership, corporation, association, government or governmental subdivision or\\nagency, or other entity.\\xe2\\x80\\x9d2 Thus, Everest and its call center agents are \\xe2\\x80\\x9cpersons\\xe2\\x80\\x9d entitled by the\\nRule to obtain price information by telephone from all \\xe2\\x80\\x9cfuneral providers.\\xe2\\x80\\x9d\\nIn the original Statement of Basis and Purpose for the Rule (\\xe2\\x80\\x9cSBP\\xe2\\x80\\x9d), the Commission\\nemphasized that the requirement that funeral providers give price information by telephone upon\\nrequest advances one of the Rule\\xe2\\x80\\x99s primary goals; namely, to allow for comparison shopping:\\n\\n1\\n\\n16 C.F.R. \\xc2\\xa7 453.2(b)(1) (emphasis added).\\n\\n2\\n\\n16 C.F.R. \\xc2\\xa7 453.1(o).\\n\\n\\x0cMr. Mark W. Duffey\\nPage 2 of 3\\nThe second disclosure requirement, the telephone price disclosure requirement,\\naddresses directly the record evidence that funeral directors have failed to respond\\nto telephone inquiries about prices. Consumers will thus have the ability to call\\nseveral funeral homes and compare their offerings before deciding where to\\npurchase. . . . In many instances, obtaining price information by telephone\\nrepresents the only practical opportunity for comparison shopping, since many\\noptions are foreclosed once the funeral home is [chosen].\\xe2\\x80\\x9d3\\nThe FTC\\xe2\\x80\\x99s Compliance Guide for funeral providers, Complying with the Funeral Rule\\n(\\xe2\\x80\\x9cCompliance Guide\\xe2\\x80\\x9d or \\xe2\\x80\\x9cGuide\\xe2\\x80\\x9d), emphasizes that if a call requesting price information is\\nreceived by a funeral provider, the call must be returned and the price information requested\\nmust be provided.4 The Guide also makes it clear that funeral providers \\xe2\\x80\\x9ccannot require callers\\nto give their names, addresses, or phone numbers before [giving] them the requested\\ninformation,\\xe2\\x80\\x9d and cannot refuse to provide price information to callers who refuse to identify\\nthemselves.5 The Guide also indicates, as the Rule provides, that the telephone price disclosure\\nmust be made by a \\xe2\\x80\\x9cfuneral provider\\xe2\\x80\\x9d that receives a telephone inquiry about prices.6 Nothing in\\nthe Rule authorizes a funeral provider to require a caller to place a second telephone call to a\\nthird party (e.g., an attorney) to obtain price information by telephone.\\nThe Funeral Rule is a trade regulation rule duly issued by the Commission that has the\\nfull force and effect of federal law. As the Commission noted in the SBP, unless a state has\\nobtained an exemption pursuant to \\xc2\\xa7 453.9 of the Rule, \\xe2\\x80\\x9cany state laws which conflict with this\\nrule after its effective date are preempted to the minimum extent necessary to resolve that\\nconflict.7 The same would be true for any state law enacted since that time.\\n\\n3\\n\\n47 Fed. Reg. 42260, 42272 (1982). The Commission also noted that \\xe2\\x80\\x9c[c]onsumer\\ngroups and state officials in numerous states reported substantial resistance or flat refusals when\\nthey attempted to gather price data by telephone for survey purposes.\\xe2\\x80\\x9d 47 Fed. Reg. at 42268.\\nWhen it amended the Rule in 1994, the Commission cited evidence that \\xe2\\x80\\x9cthe Rule overall is\\ncontributing to increased consumer \\xe2\\x80\\x98price sensitivity\\xe2\\x80\\x99 that leads some additional consumers to\\n. . . seek comparative price information from non-industry sources . . . such as calling memorial\\nsocieties, media price \\xe2\\x80\\x98hotlines,\\xe2\\x80\\x99 or state agencies that make comparative price information\\navai1able.\\xe2\\x80\\x9d 59 Fed. Reg. 1592, 1602 (1994).\\n4\\n\\nCompliance Guide (2004), p. 20.\\n\\n5\\n\\nId.\\n\\n6\\n\\nId. (\\xe2\\x80\\x9cYou must give consumers who telephone your place of business and ask\\nabout your prices or offerings accurate information from your General Price List, Casket Price\\nList, and Outer Burial Container Price List\\xe2\\x80\\x9d) (emphasis added). See also 16 C.F.R.\\n\\xc2\\xa7 453.2(b)(1).\\n7\\n\\n47 Fed. Reg. at 42287 (footnote omitted).\\n\\n\\x0cMr. Mark W. Duffey\\nPage 3 of 3\\nFor these reasons, it is a violation of the Funeral Rule for a funeral provider to refuse to\\nprovide price information by telephone upon request to any person for any reason, such as:\\n!\\n\\nState law does not require a funeral provider to disclose price information by telephone,\\nor permits a funeral provider to refuse to provide price information by telephone;\\n\\n!\\n\\nPrice information can be provided only by a third-party other than the funeral provider\\n(e.g., the funeral provider\\xe2\\x80\\x99s attorney);\\n\\n!\\n\\nThe caller will not disclose information about their organization, or what it intends to do\\nwith the information;\\n\\n!\\n\\nThe caller is not a consumer seeking to make funeral arrangements with the provider;\\n\\n!\\n\\nThe caller will or may profit from receipt of the pricing information requested;\\n\\n!\\n\\nThe caller has not requested price information in person at the funeral home;\\n\\n!\\n\\nThe caller has not requested price information in writing; or\\n\\n!\\n\\nThe caller has not paid a fee, or agreed to pay a fee, for the price information.\\n\\nAt the same time, as the Guide recognizes, funeral providers may: (1) use answering\\nmachines to record incoming calls or to advise callers to call a specified number during business\\nhours to get price information; (2) decline to provide price information outside of regular\\nbusiness hours if that is the provider\\xe2\\x80\\x99s normal practice; and (3) take a message if in the middle of\\nan arrangements conference, and call back to provide price information at a later time.8 In each\\nof these cases, the Rule requires that the funeral provider furnish price information promptly by\\nreturning the telephone call.\\nAs you know, the views expressed in this letter are those of the FTC staff. They have not\\nbeen reviewed, approved, or adopted by the Commission, and they are not binding on the\\nCommission or any individual Commissioner. However, they do reflect the views of FTC staff\\ncharged with enforcement of the Funeral Rule. Staff Funeral Rule opinions are routinely posted\\non the FTC website at http:\/\/www.ftc.gov\/bcp\/conline\/edcams\/funerals\/staffopinions.shtm.\\nSincerely,\\n\/s\/\\nCraig Tregillus\\nFuneral Rule Coordinator\\n\\n8\\n\\nId.\\n\\n\\x0c'","created_timestamp":"March 18, 2009","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/opinion-09-2\/opinion09-2.pdf"}
{"text":"b'\\x0c\\x0c\\x0c\\x0c\\x0c\\x0c'","created_timestamp":null,"downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/system\/files\/documents\/advisory_opinions\/letter-responding-complaint-computer-communications-industry-association-regarding-alleged\/071206ccia.pdf"}
{"text":"b'UNITED STATES OF AMERICA\\n\\nFEDERAL TRADE COMMISSION\\nWASHINGTON, D.C. 20580\\n\\nDivision of Marketing Practices\\nCraig Tregillus\\nctregillus@ftc.gov\\n\\nDirect Dial: (202) 326-2970\\nFacsimile: (202) 326-3395\\n\\nJuly 12, 2007\\nMr. Joseph J. DellaVecchia, Jr.\\nDellaVecchia, Reilly, Smith & Boyd Funeral Home, Inc.\\n410 North Church St,\\nWest Chester, PA 19380\\nDear Mr. DellaVechhia:\\nThis letter responds to your request for a staff opinion on whether the FTC Funeral Rule\\npermits funeral homes to: (1) Charge a fee for disposal of the container in which a third-party\\ncasket is shipped; (2) Charge a fee for storage of a third-party casket that is delivered in advance\\nof the time it is needed; and (3) Furnish consumers with two separate contracts: one covering\\ngoods and services provided by the funeral home, and one covering cash advance items secured\\nfrom third parties by the funeral home on behalf of the consumer.\\nWith respect to the first two questions, your letter acknowledges that the Funeral Rule\\ndoes not permit funeral providers to charge a casket handling fee, but argues that providers\\nshould be allowed to charge separate fees for disposing of the large containers in which thirdparty caskets are shipped, and for storing third-party caskets when they arrive several days before\\nthey are needed for a visitation or service.\\nThe requirement that funeral providers allow customers to use caskets purchased from\\nthird parties comes from section 453.4(b) of the Rule. Section 453.4(b)(i) makes it an unfair or\\ndeceptive act or practice for a funeral provider to \\xe2\\x80\\x9c[c]ondition the furnishing of any funeral good\\nor funeral service to a person arranging a funeral upon the purchase of any other funeral good or\\nfuneral service, except as required by law or as otherwise permitted by this part.\\xe2\\x80\\x9d1\\nThe prohibition on casket handling fees, arises from section 453.4(b)(ii) of the Rule\\nwhich prohibits funeral providers from charging \\xe2\\x80\\x9cany fee as a condition to furnishing any funeral\\ngoods or funeral services to a person arranging a funeral\\xe2\\x80\\x9d other than the basic services fee,\\npayments for the funeral goods and services selected, and payments for items required to meet\\n\\n1\\n\\n16 C.F.R. \\xc2\\xa7 453.4(b)(i).\\n\\n\\x0clegal, cemetery or crematory requirements.2 Thus, when a customer purchases a casket from a\\nthird party, a funeral provider is prohibited from requiring that the customer purchase any other\\ngood or service, or pay \\xe2\\x80\\x9cany fee\\xe2\\x80\\x9d other than those permitted by the Funeral Rule. Requiring\\ncustomers who use third party caskets to pay a casket handling fee would violate that section of\\nthe Rule. Likewise, it is staff\\xe2\\x80\\x99s opinion that requiring customers who use third party caskets to\\npay a shipping container disposal fee or a casket storage fee would violate the same provision of\\nthe Rule.\\nYou also asked whether the Funeral Rule permits the use of two separate contracts so that\\na funeral provider can distinguish its own charges from \\xe2\\x80\\x9ccash advance\\xe2\\x80\\x9d charges for payments to\\nthird-party suppliers. It is staff\\xe2\\x80\\x99s opinion that providing two separate contracts would conflict\\nwith section 453.2(b)(5)(i) of the Rule. That section requires that at the conclusion of the\\ndiscussion of arrangements, the funeral provider give the customer a written statement that lists\\nthe \\xe2\\x80\\x9cfuneral goods and services selected\\xe2\\x80\\x9d; \\xe2\\x80\\x9cspecifically itemized cash advance items\\xe2\\x80\\x9d; and \\xe2\\x80\\x9cthe\\ntotal cost of the goods and services selected.\\xe2\\x80\\x9d3 Thus, providing information about cash advance\\nitems in a separate document and not in the Statement would violate the Rule. However, section\\n453.2(b)(5)(ii) of the Rule provides that the information required by section 453.2(b)(5)(i) \\xe2\\x80\\x9cmay\\nbe included on any contract, statement or other document.\\xe2\\x80\\x9d You are free, therefore, to format the\\nStatement in a way that clearly distinguishes the charges for cash advance items to be paid to\\nthird parties from the charges for the goods and services you provide.\\nAs you know, the views expressed in this letter are those of the FTC staff. They have not\\nbeen reviewed, approved, or adopted by the Commission, and they are not binding on the\\nCommission or any individual Commissioner. However, they do reflect the views of FTC staff\\ncharged with enforcement of the Funeral Rule.\\nSincerely,\\n\\nCraig Tregillus\\nFuneral Rule Coordinator\\n\\n2\\n\\n16 C.F.R. \\xc2\\xa7 453.4(b)(ii) (emphasis added).\\n\\n3\\n\\nSee 16 C.F.R. \\xc2\\xa7 453.2(b)(5).\\n\\n\\x0c'","created_timestamp":"July 12, 2007","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/opinion-07-4\/opinion07-4.pdf"}
{"text":"b'UNITED STATES OF AMERICA\\n\\nFEDERAL TRADE COMMISSION\\nWA SHING TO N, D.C. 20580\\n\\nDivision of Marketing Practices\\n\\nApril 5, 2007\\nMitchell N. Roth, Esq.\\nWilliams Mullen\\n8270 Geensboro Drive, Suite 700\\nMcLean, Virginia 22102\\nDear Mr. Roth:\\nThis letter responds to your request of June 28, 2006, seeking an informal advisory\\nopinion from staff of the Federal Trade Commission (the \\xe2\\x80\\x9cCommission\\xe2\\x80\\x9d or the \\xe2\\x80\\x9cFTC\\xe2\\x80\\x9d) regarding\\nthe application of the Telemarketing Sales Rule (\\xe2\\x80\\x9cTSR\\xe2\\x80\\x9d or \\xe2\\x80\\x9cthe Rule\\xe2\\x80\\x9d), 16 C.F.R. Part 310, to a\\nbusiness plan involving the telemarketing of automobile service contracts.1 In the proposed plan,\\nyour client would supply auto service contracts under a sales program developed and maintained\\nby a third party. You request guidance on whether the third party in this plan would be both a\\n\\xe2\\x80\\x9ctelemarketer\\xe2\\x80\\x9d and a \\xe2\\x80\\x9cseller\\xe2\\x80\\x9d under the TSR, and whether your client would be neither. Based on\\nyour letter\\xe2\\x80\\x99s description of the proposed plan, we agree with your letter\\xe2\\x80\\x99s determination that the\\nthird party would meet the Rule\\xe2\\x80\\x99s definition of a \\xe2\\x80\\x9ctelemarketer,\\xe2\\x80\\x9d and its definition of a \\xe2\\x80\\x9cseller.\\xe2\\x80\\x9d\\nHowever, we also believe that your client would meet the definition of a \\xe2\\x80\\x9cseller.\\xe2\\x80\\x9d\\nRelevant Rule Provisions\\nThe TSR defines the terms \\xe2\\x80\\x9cseller,\\xe2\\x80\\x9d \\xe2\\x80\\x9ctelemarketer,\\xe2\\x80\\x9d and \\xe2\\x80\\x9ctelemarketing\\xe2\\x80\\x9d as follows:\\nSeller means any person who, in connection with a telemarketing transaction, provides,\\noffers to provide, or arranges for others to provide goods or services to the customer in\\nexchange for consideration;\\nTelemarketer means any person who, in connection with telemarketing, initiates or\\nreceives telephone calls to or from a customer or donor;\\nTelemarketing means a plan, program, or campaign which is conducted to induce the\\npurchase of goods or services or a charitable contribution, by use of one or more\\n\\n1\\n\\nFTC staff generally understands such a contract to be a promise to perform or pay\\nfor automobile repairs or services. See \\xe2\\x80\\x9cAuto Service Contracts,\\xe2\\x80\\x9d May 1997 (FTC consumer\\neducation pamphlet available at http:\/\/www.ftc.gov\/bcp\/conline\/pubs\/autos\/autoserv.pdf). We\\nfurther understand that automobile service contracts sold by automobile dealers are frequently\\nhandled by independent companies called administrators, and that such administrators may act as\\nclaims adjusters, authorizing payment of claims to any dealers under the contract. Id.\\n\\n\\x0cMr. Mitchell N. Roth\\nApril 5, 2007\\nPage 2\\ntelephones and which involves more than one interstate telephone call \\xe2\\x80\\xa6 .\\n16 C.F.R. \\xc2\\xa7\\xc2\\xa7 310.2(z), (bb), and (cc).2\\nDiscussion\\nIn your letter\\xe2\\x80\\x99s description of your client\\xe2\\x80\\x99s proposed business plan, you state that your\\nclient will, among other things: sell and administer automobile mechanical breakdown contracts;\\nsupply the service contract for sale under a program developed and maintained by a third party;\\nserve as the administrator of the service contract and take responsibility for claims payments and\\nadministering contractual obligations; and receive a predetermined wholesale cost per service\\ncontract sold.\\nYou state that the third party will, among other things: develop its own sales strategy;\\ndevelop its own marketing strategy and materials; develop scripts relevant to the sale of service\\ncontracts; manage its own sales persons and sales methods\/programs; maintain all licenses and\\nbonds required of a telemarketing seller; dictate retail product pricing; take responsibility for\\ncollecting payment; conduct all fulfillment services; and inform customers that it is selling the\\nservice contracts on its own behalf.\\nThe staff agrees with your letter\\xe2\\x80\\x99s assertion that the third party in the proposed plan\\nwould meet the Rule\\xe2\\x80\\x99s definitions of both \\xe2\\x80\\x9ctelemarketer\\xe2\\x80\\x9d and \\xe2\\x80\\x9cseller.\\xe2\\x80\\x9d The third party would\\napparently initiate or receive telephone calls to or from a customer. It appears that, by\\n\\xe2\\x80\\x9cconduct[ing] all fulfillment services\\xe2\\x80\\x9d and \\xe2\\x80\\x9cinform[ing] consumers that it is selling the Service\\nContracts on its own behalf,\\xe2\\x80\\x9d the third party would also provide or offer to provide services to\\nthe customer. Because the third party is responsible for \\xe2\\x80\\x9ccollection of payment,\\xe2\\x80\\x9d it would\\nprovide or offer to provide these services in exchange for consideration. Finally, the third party\\nwould initiate or receive these calls, and provide or offer to provide these services, in connection\\nwith telemarketing. Therefore, the third party would likely meet the Rule\\xe2\\x80\\x99s definitions of both a\\n\\xe2\\x80\\x9ctelemarketer\\xe2\\x80\\x9d and a \\xe2\\x80\\x9cseller.\\xe2\\x80\\x9d\\nHowever, the staff disagrees with your letter\\xe2\\x80\\x99s assertion that your client would meet\\nneither of these definitions. Our view, based on your letter\\xe2\\x80\\x99s discussion of the proposed business\\nplan, is that your client would meet the Rule\\xe2\\x80\\x99s definition of a \\xe2\\x80\\x9cseller.\\xe2\\x80\\x9d According to your letter,\\nyour client would be \\xe2\\x80\\x9cresponsible for claims payment and administration of contractual\\nobligations under the Service Contract,\\xe2\\x80\\x9d and would thus provide services to the customer. In\\nother words, your client would remain responsible to provide the consumer with the services that\\n\\n2\\n\\nWhen the Commission amended the TSR in 2003, 68 Fed. Reg. 4580 (Jan. 29,\\n2003), these definitions were modified pursuant to the USA PATRIOT Act, Pub. L. 107-56\\n(Oct. 26, 2001), to reach not only calls made to induce purchases, but also those made to induce\\ncharitable contributions. Otherwise, the definitions are substantively the same as in the original\\nrule, although they were renumbered. 60 Fed. Reg. 43843 (Aug. 23, 1995).\\n\\n\\x0cMr. Mitchell N. Roth\\nApril 5, 2007\\nPage 3\\ncomprise, in large measure, what the consumer is purchasing. In return, your client would\\n\\xe2\\x80\\x9creceive a predetermined wholesale cost per service contract sold.\\xe2\\x80\\x9d Finally, your Client would\\nperform these services in connection with telemarketing. We believe that this activity is\\nsufficient to bring your client\\xe2\\x80\\x99s role in the proposed business plan within the Rule\\xe2\\x80\\x99s definition of\\na \\xe2\\x80\\x9cseller.\\xe2\\x80\\x9d We note that neither the text of the Rule itself nor the Statement of Basis and Purpose\\nthat accompanied it when issued suggest that in a given transaction one and only one party can be\\na \\xe2\\x80\\x9cseller\\xe2\\x80\\x9d for purposes of Rule coverage. Arrangements such as described in your letter may\\nresult in more than one \\xe2\\x80\\x9cseller\\xe2\\x80\\x9d in a particular transaction.\\nThe fact that the marketing campaign for the sales contract would be developed and\\nexecuted by a third party is not determinative as to the question of who meets the definition of\\n\\xe2\\x80\\x9cseller\\xe2\\x80\\x9d under the Rule. As the Commission noted in the Statement of Basis and Purpose for the\\noriginal TSR:\\nthe term [\\xe2\\x80\\x98seller\\xe2\\x80\\x99] includes not only persons who, in connection with a\\ntelemarketing transaction, provide or offer to provide goods and services to the\\ncustomer in exchange for consideration, but also persons who, in connection with\\na telemarketing transaction, arrange for others to provide goods or services to the\\ncustomer \\xe2\\x80\\xa6 . [T]he Rule\\xe2\\x80\\x99s coverage cannot be avoided by structuring a sale so\\nthat someone other than the seller actually provides the goods or services directly\\nto the customer.\\n60 Fed. Reg. 43844, Aug. 23, 1995. In light of our conclusion that your client would meet the\\nRule\\xe2\\x80\\x99s definition of a \\xe2\\x80\\x9cseller\\xe2\\x80\\x9d under the described business plan, we advise that your client would\\nremain within the scope of the Rule\\xe2\\x80\\x99s coverage.\\nThe opinions expressed in the foregoing discussion and the basis for this conclusion are\\nthose of Commission staff only and are not attributable to, nor binding on, the Commission itself\\nor any individual Commissioner. I hope this discussion is helpful to you. If you have any further\\nquestions, please do not hesitate to contact me at 202-326-2330.\\nSincerely,\\n\\nGary Ivens\\n\\n\\x0c'","created_timestamp":"April 5, 2007","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/opinion-07-1\/opinion0701_0.pdf"}
{"text":"b'\\x0c\\x0c\\x0c\\x0c\\x0c'","created_timestamp":null,"downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/opinion-07-2\/opinion07-2.pdf"}
{"text":"b'S~nnenschein\\n\\n1301 K Street N.W.\\nSuite 600, East Tower Chicago\\nWashington, D.C. 20005-3364 Kansas\\n202.408.6400 Los Angeles\\n202.408.6399 fax New Vork\\nwww,sonnenscheln.com Phoenix\\n\\nS O N N E N S C H E I N N A T H & R O S E N T H A L LLP\\n\\nChristopher Smith\\n202.408.923 1\\n\\nkitsmith@sonnenschein.com\\n\\nSan Francisco\\nShort Hills, N.J.\\nSt. Louis\\nWashington, D.C.\\nWesf Palm Beach\\n\\nElaine D. Kolish\\n202.408.3243\\n\\neltolish@sonnenschein.com\\n\\nNovember 15,2006\\n\\nThe Honorable Donald S. Clark\\nSecretary\\nFederal Trade Commission\\n600 Pennsylvania Ave., N.W.\\nWashington, DC 20580\\nRe:\\n\\nRequest For a Staff Advisory Opinion\\n\\nDear Mr. Clark:\\nOn behalf of Sony Electronics Inc. (Sony) we are requesting a staff advisory opinion,\\npursuant to 16 C.F.R. fj 1.1, on the question of whether Sony may lawfully market and sell as\\nnew certain returned consumer electronics products that have never been used and that are\\nindistinguishable from products straight fiom the factory. Specifically, Sony seeks guidance on\\nthe acceptability of selling consumer electronics products as new products under a narrowly\\ndefined program in which Sony or its authorized vendor would:\\n(i)\\n\\nidentify, fi-om among the products returned by retailers to Sony or its authorized\\nvendor, those that have never been turned on;\\n\\n(ii) visually inspect those products that have not been turned on and reject any damaged\\nproducts;\\n(iii) ensure that returned products that satisfy the first two conditions have all of their\\nrequisite parts, components, and manuals;\\n(iv) repackage the returned products that meet the above conditions;\\n(v)\\n\\nprovide the same warranty for these returned products as for new products that have\\nnever been sold; and\\n\\nY\\n\\nE\\n\\n2\\n\\nA\\n\\n0\\n\\nR\\n\\n0\\n\\nS\\n\\n6\\n\\n\\x0cS~nnenschein\\n\\nSONNENSCHEIN NATH & ROSENTHAL LLP\\n\\nFederal Trade Commission\\nNovember 15,2006\\nPage 2\\n\\n(vi) return them to a retailer for sale as new products.\\'\\nThis request is based on our understanding of prior Commission policy and precedent\\nthat require a seller to disclose when it is selling goods that have been previously used, but do\\nnot require returned goods that have merely been \"inspected\" by consumers to be described as\\nused when resold. Sony3srequest does not require the FTC staff to define the entire scope of\\nactions that can reasonably constitute inspection. Instead, we only ask the staff to conclude (a)\\nthat a product that has never been turned on will not be considered used, and (b) that the other\\nelements of Sony\\'s proposed program will assure that a consumer buying such a product will\\nencounter the same product purchase and usage experience as if he or she had bought a new\\nconsumer electronics product that had not been purchased previously.\\nWe explain below the reasons for Sony\\'s proposed course of action and provide\\nadditional details about how the program would be implemented. Additionally, we set forth an\\nanalysis of why we believe Sony\\'s proposed conduct is legally permissible and why it is\\nappropriate for the FTC staff to provide the requested guidance.\\n\\nSony\\'s Proposal to Sell Certain Unused Returned Consumer Electronics as New\\nLike many other consumer electronics companies, Sony experiences a high volume of\\nproduct returns from consumers, the wholesale value of which has grown dramatically in recent\\nyears. As a matter of policy, Sony generally treats all opened returned products as if they have\\nbeen used by consumers. These returned products, which are often inspected and serviced, are\\ndesignated by Sony as \"Class B\" products. These products are sold as refurbished products at a\\nsignificantly discounted price, and they typically include a 90-day limited warranty rather than a\\nlonger new product warranty.\\nBecause of the undifferentiating nature of its resale policy, many products designated as\\nClass B by Sony have never even been turned on - having merely been inspected by purchasers\\nbefore being returned to Sony. Such products have nothing wrong with them when returned by\\nconsumers and require no servicing before they are sold at a Class B discount.\\n\\n\\'\\n\\nThe consumer electronics products potentially covered by Sony\\'s program include but are not limited to the\\nfollowing products: video products (e.g.,DVD playerslrecorders, digital cameras, camcorders, televisions, and\\ncombination TVIVCR or TVDVD players); computers (desktop and notebook PCs and related equipment); video\\ngame systems; audio products (desktop, component and portable devices); cell phones; portable digital assistants;\\nand vehicle electronics.\\n\\nEGRITY\\nY\\n\\nE\\n2\\n\\nA\\n0\\n\\nR\\n0\\n\\nS\\n6\\n\\n\\x0cS~nnenschein\\n\\nSONNENSCHEIN NATH & ROSENTHAL LLP\\n\\nFederal Trade Commission\\nNovember 15,2006\\nPage 3\\n\\nThe financial cost to Sony of its Class B resale policy is substantial. Consequently, Sony\\nwould like to modify its policy to distinguish between returned products that have not been\\nturned on and those that have been operated. Such a modification would provide Sony with\\ngreater flexibility in both inventory control and supply chain management while ensuring\\ncompliance with the Commission\\'s policies.\\nAlthough even some use of a product reasonably could be considered mere \"inspection,\"\\nSony proposes to take an extremely conservative approach to the question of whether a returned\\nSony product has been used by a consumer. Sony\\'s proposed program is based on the simple,\\nbright line standard of whether a product has been turned on - i.e., if it has not been turned on, it\\nhas not been used. This approach avoids a potential slippery slope, because it does not require\\nthe FTC to evaluate or determine how much use is acceptable.\\nTo implement this policy change in a consistent, verifiable manner, Sony would use\\nexisting, reliable product and packaging technologies to determine if a purchaser has turned on a\\nreturned product. For example, some of Sony\\'s electronic products contain an internal chip or\\nclock that allows Sony to determine if a product has been turned on and for how long. Sony also\\nmay use tamper-evident tape, seals or labels, which can be affixed to AC plugs, connectors or\\nbattery compartments, to provide a clear indicator of consumer use of a product. Sony would\\ndetermine on a product-by-product basis which technology it would use to determine if a\\nconsumer has turned on a product. If the consumer has turned on the product at all - even if only\\nto conduct a cursory inspection of the product\\'s operation - Sony would disqualify the product\\nfi-om future sale as a new product. Sony\\'s plan thus avoids subjective evaluations about whether\\nor to what extent a returned product has been used by a consumer. Stated in its simplest terms, if\\nelectrical power has been applied to any of the product\\'s circuitry, then it cannot be sold as\\nnew.\"\\nLC\\n\\nThe other elements of Sony\\'s program ensure that the consumer purchasing experience\\nwould be the same as it would be with other new products. Sony would visually examine unused\\nproducts to ensure that they are complete and undamaged, and if so, place them in new\\npackaging.2 sony also would provide the same wmanty for these repackaged products as for\\nThis program will not involve refurbishment of products to a \"good as new\" condition. If there is visible damage,\\nsuch as scratches, dents or cracks, the product would not be eligible for the program. Of course, minor cosmetic\\nblemishes, such as fingerprints that a consumer might leave on a product when handling it, would be removed and\\nwould not render the product ineligible for the program. Otherwise damaged products would be designated for\\nSony\\'s refurbished sales program. Moreover, if the product is otherwise acceptable but a minor part or piece of\\nproduct dormation (e.g.,a headphone, manual, or warranty card) is missing because the consumer omitted the item\\nfrom the package when returning the product, then the missing item would be replaced.\\n\\n\\x0cS~nnenschein\\n\\nSONNENSCHEIN NATH & ROSENTHALLLP\\n\\nFederal Trade Commission\\nNovember 15,2006\\nPage 4\\n\\nother new similar products. Because Sony (or its authorized agent), and not retailers, would run\\nthe program, Sony can ensure that the policy is properly and uniformly applied across all returns.\\n\\nSony and Industry Experience With Returns Show the Significance of Sony\\'s Request\\nCurrently, as would be the case under the new program, retailers send all returned\\nproducts to return centers operated by Sony or its authorized agent. These return centers perfom\\nthe necessary inspections and refurbishment to prepare a returned item for resale as Class B\\nproducts. Sony\\'s experience through these return centers indicates that only a very small\\npercentage of returns are actually defective products and that a very significant percentage fall\\ninto the \"no problems found\" (NPF) category. Because many of the NPF products are items that\\nhave never been turned on, Sony incurs significant losses from their sale as Class B products.\\nSimilar industry-wide patterns of returns also have been reported. For example, a\\nconsumer survey conducted by the Consumer Electronics Association (CEA) in 2005 indicated\\nthat many consumers return products for reasons other than a defect, including (a) to obtain a\\ndifferent brand or model, (b) because they no longer wanted it, (c) because they already owned\\nit, or (d) because they spent too much money on i t 3 The CEA survey also indicated that nearly\\n50 percent of all returns occur within a week after purchase. Overall, these statistics suggest that\\nmany purchasers of consumer electronics products may merely open the box and inspect the\\nproduct without using it before returning it to the retailer or to the manufacturer.\\n\\nSony\\'s Proposed Course of Action Is Lawful\\nSony believes that its proposed course of action, as described in this letter, is lawful and\\nwould not be deceptive under the FTC Act or under the standards the Commission has expressed\\nin its 1984 Policy Statement on Deception and in its 1969 Enforcement Policy on \"Merchandise\\nWhich Has Been Subjected To Previous Use On Trial Basis and Subsequently Resold as New.\"\\nThe 1969 policy statement is particularly relevant. Although the 1969 Enforcement Policy\\npredates the Commission\\'s Policy Statement on Deception, it has not been repudiated by the\\nCommission. Moreover, we believe that application of the Deception Statement\\'s analytical\\ntools leads to the same conclusion the Commission reached in its 1969 Enforcement Policy.\\nThe 1969 statement, whle reaffirming the Commission\\'s long-held view that consumers\\nhave a preference for new or unused goods, also draws an important distinction between\\n3\\n\\n\"Return Rates and Issues for CE Products Update,\" Consumer Electronics Association (CEA) Market Research\\nReport (Nov. 2005).\\n\\nEGRITY\\nY\\n\\nE\\n\\nA\\n\\nR\\n\\nS\\n\\n\\x0cS~nnenschein\\nSONNENSCHEIN NATH & ROSENTHALLLP\\n\\nFederal Trade Commission\\nNovember 15,2006\\nPage 5\\n\\n\"inspectionyyand\\nSpecifically, the Commission concluded that trial use by a consumer\\nand subsequent refix-bishment of returned products to a good-as-new conhtion requires\\ndisclosure, but that its \"policy applies only to merchandise that has been used, and not to\\nmerchandise that has merely been inspected but not used.\"\\'\\nUnder the Deception Policy Statement there must be a representation, omission or\\npractice that is likely to mislead a consumer, acting reasonably under the circumstances, to his or\\nher detriment.6 In other words, the representation, omission or practice must be a material one.\\nUnder its proposed program, Sony would treat the products as new, in terms of their pricing,\\npackaging and warranty. The resulting implied representation that the repackaged products are\\nnew would not be misleading to consumers because the products would in fact be new, having\\nnever been used by their previous purchasers.7\\nAlthough Sony recognizes that the FTC appreciates empirical data on consumer\\nexpectations when it is available, we are unaware of any such empirical data in this case.\\nNevertheless, the absence of such data is not a bar to an advisory opinion. It is well established\\nin Cornmission case law that the Commission may use its accumulated expertise to determine\\nwhat facts are material to consumers and when it is deceptive to omit those facts from marketing\\nmaterials.\\' In the past, the Commission has generally alleged a deceptive failure to disclose\\ninformation only when the omitted information involved health or safety or the key financial\\nterms and conditions of a transaction.\\nWe also suggest that the FTC can find additional support for Sony\\'s proposed course of\\naction in various state laws that expressly or impliedly permit \"unused\" goods to be sold as new.\\nMany of these states have based their laws on the Uniform Deceptive Trade Practices Act and\\nthe Uniform Consumer Sales Act, which prohbit the resale, as new, of returned products only if\\nthe products have been used, altered, reconditioned or reclaimed. Under those statutes, mere\\n34. Fed. Reg. 176, 177.\\n\\nId. at 177.\\nAppended to ClzffdaleAssociates, Inc., 103 F.T.C. 110, 174 (1984).\\nJust as we believe that Sony has no legal obligation to disclose that goods are \"used\" because they have never been\\nturned on and thus fall squarely into the \"inspected\" category, we also believe that disclosure of the mere fact of\\nprior purchase is not a material omission that might trigger a disclosure requirement. The Commission\\'s Policy\\nStatement expressly recognizes that \"not all omissions are deceptive, even if providing the information would\\nbenefit consumers.. ..\" Id. at 183, n.4. Such a disclosure requirement also would be inconsistent with state laws, as\\ndiscussed below.\\n\\nSee, e.g., PJzer, 81 F.T.C. 23, 58 (1972).\\n\\n\\x0cS~nnenschein\\n\\nSONNENSCHEIN NATH & ROSENTHAL LLP\\n\\nFederal Trade Commission\\nNovember 15,2006\\nPage 6\\n\\ninspection that does not entail use or alteration of the product would not change the status of the\\nNotably, the Ohio Administrative Code states affirmatively that\\nproduct fiom \"new\" to\\n\"returned goods, which have not been used by a previous purchaser, shall be considered new or\\nunused.\"I0\\nFurthermore, in 1998 the Office of the Attorney General of the State of California came\\nto the same conclusion reached by the FTC in 1969 when it analyzed the question: \"must\\nmerchandise be advertised as \\'secondhand or usedyif it is used, worn, or sampled for a short\\ntime by a consumer and then returned in like-new condition pursuant to the retailer\\'s policy\\nallowing returns of merchandise at the customer\\'s discretion.\" Attorney General Daniel E.\\nLungren concluded that it must be so advertised,\" unless such use is for inspection purposes\\nonlY.\\'~\"\\n\\nIn analyzing the question, Attorney General Lungren was guided in part by the Oregon\\nSupreme Court\\'s decision in Weigel v. Ron Tonkin Chevrolet co.12 In that case the court held\\nthat because there was a transfer of legal possession of the auto and the purchaser had\\ndiscretionary use of the vehicle for his or her own purposes for five days, the auto must be\\nrepresented as used or secondhand. The court\\'s decision was based not on the fact of the sale,\\nbut on the purchaser\\'s use of the product. In that case, the court also commented on the common\\npractice of using goods for inspection purposes only, stating that \"merchandise other than\\nautomobiles sometimes is sold, examined, or tried out at home, and returned to the seller.\\nWhether such merchandise is \\'new\\' or \\'usedy does not depend on the fact of an earlier sale; it\\ndepends on whether the article was used.\"I3 The Attorney General believed that Weigel correctly\\ninterpreted the terms \"secondhand or used\" for its purposes. Thus, under the Attorney General\\'s\\nopinion, disclosure of the prior purchase of a product depends upon whether the product has been\\nused, unless such use is for inspection purposes only.\\n\\nSee Michael P. Sullivan, \\'What Goods or Property are \\'Used,\\' \\'Secondhand,\\' or the Like, for Purposes of State\\nConsumer Laws Prohibiting Claims that Such Items are New,\" 59 A.L.R. 4\\' 1192,s 2.\\n10\\n\\nSection 109:4-3-08. Other states such as Mississippi and Idaho have taken similar positions (\"goods are not\\nconsidered used if a prior consumer was given a full refund or exchange for the goods, in the normal course of\\nbusiness, and if the goods are not known to presently or formerly have defects\"). See, e.g., Mississippi, 24 000 002\\nR.5 1 (2006), and Idaho, IDAPA 04.02.02.113 (Returned Goods) (2005). See also Louisiana, LAC 16:III.S11(2003).\\nI \\' Opinion of Daniel E. Lungren, Attorney General, Clayton P. Roche, Deputy Attorney General, No. 97-1009\\n(May 22, 1998) (emphasis added).\\n\\nl3\\n\\nId. at 490, n.2.\\n\\nY\\n\\nE\\n2\\n\\nA\\n0\\n\\nR\\n0\\n\\nS\\n6\\n\\n\\x0cS~nnenschein\\n\\nSONNENSCHEIN NATH & ROSENTHAL LLP\\n\\nFederal Trade Commission\\nNovember 15,2006\\nPage 7\\n\\nSony believes that, under its proposed program, consumer electronics products that have\\nnot been turned on will not have been subjected to any use. The act of merely opening the\\npackaging and examining a product without turning it on should be considered \"inspection\" and\\nshould not trigger any affirmative disclosure duties nor any prohibition on representing the goods\\nas new.\\nAt its most basic level, Sony\\'s proposed program embodies the principles contained in\\nthe Commission\\'s 1969 policy statement and in the principles expressed in state laws and in the\\nCalifornia Attorney General\\'s opinion regarding a company\\'s disclosure duty. We believe that\\nthe principles of the 1969 policy statement remain valid and are consistent with those in the more\\nrecent Deception Policy Statement. Accordingly, Sony submits that it would be appropriate for\\nthe FTC to conclude that Sony consumer electronics products returned by consumers without\\never being turned on can be considered \"merely inspected\" and not \"used\" and thus be eligible\\nfor sale as new products.\\n\\nSony\\'s Request Satisfies the Commission\\'s Criteria for a Staff Advisory Opinion\\nSony believes that the issues raised by this request satisfy the criteria in the Commission\\'s\\nRules of Practice for issuance of a staff advisory opinion. The question posed by Sony is not a\\npurely hypothetical or theoretical one, because Sony is prepared to act upon a favorable opinion\\nissued by the staff. Sony is seeking this advisory opinion because, as noted above, the FTC has\\nnot issued guidance in this area in nearly 40 years, and there is no clear FTC or other guidance\\non the particular question posed by Sony. Furthermore, because of uncertainty about this issue,\\nSony and possibly other manufacturers are unnecessarily designating unused, \"merely inspected\"\\nproducts as Class B products. This situation creates substantial economic injury to\\nmanufacturers such as Sony, as well as to consumers, who may pay higher overall retail prices or\\nmay experience the effects of reduced marketplace competition resulting from lower\\nmanufacturer profitability. Thus, resolution of Sony\\'s question is likely to be of significant\\npublic interest.\\n\\nConclusion\\nThe conservative approach Sony is proposing will assure that returned products that\\nqualify under this program will be indistinguishable from new products delivered &om the\\nfactory. The fact that a qualifylng product was previously purchased will not affect its\\nperformance because the product will never have been turned on and thus never have been used.\\nMoreover, Sony\\'s plan to examine qualifylng returned products visually for damage and\\ncompleteness prior to repackaging and to provide a new product warranty will ensure that the\\nreturned products are indistinguishable from products that have never been sold. This\\n\\nEGRlN\\nY\\n\\nE\\n\\nA\\n\\nR\\n\\nS\\n\\n\\x0cS~nnenschein\\nSONNENSCHEIN NATH & ROSENTHAL LLP\\n\\nFederal Trade Commission\\nNovember 15,2006\\nPage 8\\n\\ncomprehensive plan will eliminate any potential harm to subsequent purchasers resulting from\\nthe qualifying products\\' previous purchase. Accordingly, Sony believes that its proposed\\nprogram to sell, as new, returned products that have not been turned on and that meet the\\nprogram\\'s other criteria will satisfy the Commission\\'s consmer protection objectives and\\nrequirements.\\nWe appreciate your consideration of this request. Please let us know if you would like us\\nto provide additional information to assist the staffs review. We would also be pleased to meet\\nwith the staff to discuss any questions they might have.\\n.\\n\\n..\\n\\nYours very truly,\\n\\nChristopher Smith\\nElaine D. Kolish\\ncc:\\n\\nLydia B. Parnes, Director, Bureau of Consumer Protection\\nJames A. Kohm, Associate Director, Division of Enforcement\\nSandy Prabhu, Esq., Division of Enforcement\\n\\nY\\n\\nE\\n\\n2\\n\\nA\\n\\n0\\n\\nR\\n\\n0\\n\\nS\\n\\n6\\n\\n\\x0c'","created_timestamp":"May 22, 1998","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/system\/files\/documents\/advisory_opinions\/sony-electronics-proposal-resell-new-returned-consumer-electronics-products\/sony_request_for_staff_opinion_11-15-06.pdf"}
{"text":"b'UNITED STATES OF AMERICA\\n\\nFEDERAL TRADE COMMISSION\\nWASHINGTON, D.C. 20580\\n\\nDivision of Enforcement\\nBureau of Consumer Protection\\n\\nDecember 20,2006\\n\\nChristopher Smith, Esq. and Elaine Kolish, Esq.\\nSonnenschein, Nath & Rosenthal LLP\\n1301 K Street, NW\\nSuite 600, East Tower\\nWashington, DC 20005-3364\\nDear Mr. Smith and Ms. Kolish:\\nThis letter responds to your request on behalf of your client, Sony Electronics Inc.\\n(\"Sony\"), for a staff advisory opinion regarding Sony\\'s proposal to resell, as \"new,\" returned\\nconsumer electronics products when the company or its authorized vendor can reliably determine\\nthat the products have never been turned on and other particular conditions are met. This\\nadvisory opinion is based on the information that you have provided to us in your letter of\\nNovember 15,2006. All references to facts regarding your proposal are based on your\\nrepresentations; we have not conducted an independent investigation, or otherwise verified the\\ninformation that you provided.\\nYou note that Sony, as well as other companies in the consumer electronics industry,\\nexperience high return volumes.\\' Sony\\'s uniform practice has been to treat all opened and\\nreturned products as used. As a result, following inspection and servicing, these products are\\nsold as \"refurbished\" at significantly discounted prices and include a 90-day limited warranty.\\nYou state that, because many of the returned products in fact have never been used, the current\\nresale policy comes at a substantial financial cost to the company. Sony proposes modifying its\\npractices by distinguishing between returned products that previously have been turned on and\\nwith the latter category of products being eligible for resale as new, if\\nthose that have notY2\\nspecific criteria are met.\\n\\n1\\n\\nConsumer electronics products sold by Sony include video products (DVD\\nplayers\/recorders, digital cameras, camcorders, televisions, and combination TVNCR or\\nTV\/DVD players), computers (desktop and notebook PCs and related equipment), video game\\nsystems, audio products (desktop, component and portable devices), cell phones, portable digital\\nassistants, and vehicle electronics.\\n2\\n\\nSony would regard a product has having been \"turned on\" if electrical power had\\nbeen applied to any of the product\\'s circuitry.\\n\\n\\x0cChristopher Smith and Elaine Kolish\\nDecember 12,2006\\nPage 2\\nYou state that Sony would implement the policy modification by having it or one of its\\nauthorized vendors:\\ni.\\n\\n..\\n\\nintroduce reliable product packaging technologies that ensure an objective\\nand verifiable process for identifying returned products that have never\\nbeen turned on.3\\n\\n11.\\n\\nidentify, fiom among the products returned by retailers to Sony or its\\nauthorized vendor, those that have never been turned on;\\n\\niii.\\n\\nvisually inspect those products that have not been turned on and reject any\\ndamaged products;\\n\\niv.\\n\\nensure that returned products that satisfy the first two conditions have all\\nof their requisite parts, components, and manuals;\\n\\nv.\\n\\nrepackage the returned products that meet the above conditions;\\n\\nvi.\\n\\nprovide the same warranty for these returned products as for new products\\nthat have never been sold; and\\n\\nvii.\\n\\nreturn them to a retailer for sale as new products.\\n\\nYou then ask for the staffs opinion as to whether Sony\\'s proposed course of conduct complies\\nwith the FTC Act and other Commission policy statements.\\nSection 5 of the FTC Act, which prohibits deceptive acts or practices, governs the issue.\\n15 U.S.C. tj 45. The Commission has explored the concept of deception under Section 5 in two\\nrelevant policy statements.\\nOur analysis begins with the Commission\\'s 1969 Enforcement Policy on Merchandise\\nWhich Has Been Subjected to Previous Use on Trial Basis and Subsequently Resold as New. 34\\nFed. Reg. 176-77. The 1969 Enforcement Policy concerned the then-prevalent business practice\\nof selling, as new, products that previously had been used on a trial basis by prospective\\npurchasers. Id. at 176. In that policy statement, the Commission set out the broad principle that\\ndeception lies where a marketer \"[fails] to disclose material facts relevant to a purchaser\\'s\\ndecision to buy or not to buy.\" Id. Because consumers have a preference for new or unused\\nproducts, the Commission found that prior use was material to the purchase decision. Id. The\\nCommission, therefore, concluded that the failure to disclose prior use was unlawfbl even where\\n3\\n\\nSome of these technologies include internal chips or clocks with the ability to\\nindicate whether a product has been turned on; and tamper-evident tape, seals, or labels affixed to\\nAC plugs, connectors, or battery compartments.\\n\\n\\x0cChristopher Smith and Elaine Kolish\\nDecember 12,2006\\nPage 3\\nreturned merchandise had been refurbished to \"good as new\" condition. Id. at 177. The\\nCommission noted, however, that this policy applied only to products that in fact had been\\n\"used,\" as distinguished from products that had \"merely been inspected but not used.\" Id.\\nThe Commission provided more specific guidance in its Policy Statement on Deception,\\nappended to Clifldale Assocs., Inc., 103 F.T.C. 110, 174 (1984). The Commission stated that it\\nwill find deception where a representation, omission or practice is likely to materially mislead a\\nconsumer acting reasonably under the circumstances. Id. at 176. Materiality is a core element of\\ndeception. A misrepresentation or omission is material if it is \"likely to affect a consumer\\'s\\nchoice of or conduct regarding the product,\" and therefore, injures the consumer who may have\\notherwise made a different choice. Id. at 182-83.\\nPursuant to the guidance provided by these policy statements, we do not believe that\\nconsumers would be deceived by Sony\\'s resale of returned consumer electronics within the\\nguidelines described above. As an initial matter, by limiting its program to products that have\\nnever been turned on, it appears that Sony would be reselling products that fall within the\\n\"inspected but not used\" category referenced in the 1969 Enforcement Policy. However, the\\nanalysis does not end there. The products, as a result of prior purchase, may carry defects upon\\nreturn. For example, a returned product may never have been turned on, but nonetheless may be\\ndamaged or missing requisite parts and inserts. Sony\\'s program appears comprehensive enough\\nto avoid such defects and protect consumers from injury, thereby likely rendering the fact of prior\\npurchase immaterial. Therefore, we believe Sony would be acting lawfblly under Section 5 of\\nthe FTC Act in implementing its proposed program, as represented to Commission staff.\\nThis letter sets out the views of the staff of the Bureau of Consumer Protection, as\\nauthorized by the Commission\\'s Rules of Practice. Those views are based on information\\nprovided to Commission staff by you. Staff have not engaged in independent factual\\ninvestigation regarding the proposal. In accordance with Section 1.3(c) of the Commission\\'s\\nRules of Practice and Procedure, 16 C.F.R. 5 1.3(c), this is a staff opinion only and has not been\\nreviewed or approved by the Commission or by any individual Commissioner, and is given\\nwithout prejudice to the right of the Commission later to rescind the advice and, where\\nappropriate, to commence an enforcement action. In accordance with Section 1.4 of the\\nCommission\\'s Rules of Practice and Procedure, 16 C.F.R. 5 1.4, your request for advice, along\\nwith this response, will be placed on the public record.\\nWe appreciate your taking the time to\\n\\n~ssdciateDirector for Enforcement\\n\\n\\x0c'","created_timestamp":null,"downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/resale-consumer-electronics\/061220staffopintosonyelect.pdf"}
{"text":"b'UNITED STATES OF AMERICA \\xe2\\x84\\xa2\\nFEDERAL TRADE COMMISSION Wp\\n\\nWASHINGTON, D.C. 20580\\n\\naN A 6\\nOffice of the Secretary ae\\n\\nApril 18, 2006\\n\\n \\n\\nCarl G. Bartholomaus, Corporate Counsel\\nDuPont Company\\n\\nBuilding 23-2128\\n\\nBarley Mill Plaza\\n\\nWilmington, Delaware 19880-0023\\n\\nRe: Petition of Mohawk Industries, Inc., E.I. du Pont de Nemours and\\nCompany, and PTT Poly Canada (\\xe2\\x80\\x9cPetitioners\\xe2\\x80\\x9d) for a new generic fiber\\nname and definition under the Rules and Regulations Under the Textile\\nFiber Products Identification Act, 16 C.F.R. Part 303.\\n\\nDear Mr. Bartholomaus:\\n\\nPursuant to Rule 8(b) of the Rules and Regulations Under the Textile Fiber Products\\nIdentification Act, 16 C.F.R. \\xc2\\xa7 303.8(b), the Commission has assigned the designation \\xe2\\x80\\x9cPTT001\\xe2\\x80\\x9d\\nto Petitioners\\xe2\\x80\\x99 PTT fiber for temporary use until a final determination can be made as to the\\nmerits of the application.\\n\\nThe assignment of this temporary designation should not be construed as indicating that\\nthe Commission will either grant or deny the application or that the Commission has determined\\n\\nthe application to be complete.\\n\\nDonald S. Clark\\nSecretary\\n\\nBy direction of the Commission.\\n\\x0c'","created_timestamp":"April 18, 2006","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/dupont\/mohawk\/ptt-poly-canada-fiber-ftc-response\/ptt001_letter.pdf"}
{"text":"b'UNITED STATES OF AMERICA\\n\\nFEDERAL TRADE COh\\'lMISSION\\nWASHINGTON. D.C. 20580\\n\\nDivision of Advertising Practices\\n\\nMary Koelbel Engle\\nAssociate Director\\n\\nMarch 15,2005\\n\\nVIA FIRST-CLASS MAIL and EMAIL\\nAnnette Dickinson, Ph.D.\\nPresident\\nCouncil for Responsible Nutrition\\n1828 L St. NW, Suite 900\\nWashington, DC 20036-5114\\n\\nRe:\\n\\nCouncil for Res~onsibleNutrition\\'s Comulaint Against\\n\\nDear Dr. Dickinson:\\nThank you for your January 12,2005, letter and subsequent materials regarding\\nConsumerLab.com, LLC (\"ConsumerLab) and its Product Review and Voluntary Certification\\nprograms for testing dietary supplements and similar consumer products (\"Test Programs\").\\nCouncil for Responsible Nutrition alleges that ConsumerLab\\'s \"entire business model represents\\nan egregious form of consumer fraud and deception,\" and asserts, among other things, that\\n\\n*\\n\\n*\\n\\n\"[Clompanies are pressured . . . into paying a fee\" for testing under the\\nVoluntary Certification program to avoid potential negative consequences\\nof having their products tested under the Product Review program; and\\nthat\\nConsumerLab\\'s Test Programs and its reporting of test results \"are likely\\nto mislead consumers into believing that ConsumerLab is operating in the\\npublic interest and cannot be influenced by any outside party.\"\\n\\nThe Commission has been directed by Congress to act in the interest of all consumers to\\nprevent deceptive or unfair acts or practices, pursuant to Section 5 of the Federal Trade\\nCommission Act, 15 U.S.C. 3 45. A representation, omission, or practice is deceptive if (1) it is\\nlikely to mislead consumers acting reasonably under the circumstances; and (2) it is \"matesial,\"\\nthat is, likely to affect consumers\\' conduct or decisions with regard to a product or service. An\\nact or practice is unfair if it causes or is likely to cause injury to consumers that (1) is substantial;\\n(2) is not outweighed by countervailing benefits to consumers or to competition; and (3) is not\\n\\n\\x0cCouncil for Responsible Nutrition\\nMarch 15, 2005\\nPage 2\\nreasonably avoidable by consumers themselves.\\nIn determining whether to take enforcement or other action in any particular situation, the\\nCommission rnay consider a number of factors, including the type of violation alleged, the nature\\nand amount of consumer injury at issue, the number of consumers affected, and the likelihood of\\npreventing future unlawful conduct and securing redress or other relief. After reviewing the\\ncomplaint and related materials, staff is not recommending agency action at this time. The\\nCommission reserves the right, however, to take such further action as the public interest rnay\\nrequire.\\nThank you for bringing Council for Responsible Nutrition\\'s concerns regarding\\nConsumerLab.com,LLC to our attention.\\nVery truly yours,\\n\\ncc:\\n\\nTod Cooperman, M.D.\\nPresident\\nConsumerLab.com,LLC\\n\\n\\x0c'","created_timestamp":"March 15, 2005","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/system\/files\/documents\/advisory_opinions\/letter-council-responsible-nutrition-regarding-consumerlab.com-llc-its-product-review-voluntary-certification-programs-testing-dietary-supplements-similar\/050315crnreconsumerlab.pdf"}
{"text":"b'\\x0c\\x0c\\x0c\\x0c\\x0c'","created_timestamp":null,"downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/system\/files\/documents\/advisory_opinions\/letter-dma-regarding-email-messages-containing-content-multiple-advertisers-when-one-advertisers-has\/050308dmaletter.pdf"}
{"text":"b'SWAINE & MOORE LLP\\n\\nCRAVATH\\nFRCIS P. BARRON\\n\\nGEORGE ... GILLESPIE, m\\nTHOMAS R. BROME\\n\\nROBERT D. .JOFFE\\nALLEN FINKELSON\\nRONALD S. ROLF\\nPAUL C. SAUNDERS\\nDDUGLA D. BROADATER\\n\\nAL C. STEPHENSON\\nMA R. SHULMAN\\nSTUAR W. GOLD\\n\\n.JOHN W. WHITE\\n.JOHN E. BEERBOWER\\nEVAN R. CHESLER\\nPATRICIA GEOGHEGAN\\nD. COLLIER KIRKHAM\\n\\nMICHAL L. SCHLER\\nKRIS F. HEINZLMAN\\nB. ROBBINS KIESUNG\\nROGER D. TURNER\\n\\nPHIUP A. GELSN\\nRORY o. MILLON\\nNEIL P. WESTREICH\\n\\nRICHAD W. CLARY\\n\\nWILLIA P. ROERS, ..R.\\n.JAMES D. COOPER\\nSTEPHEN L GORDON\\n\\nWORLDWIDE PLAZA\\n\\n825 EIGHTH\\n\\nAVENUE\\nNEW YORK, NY 10019- 7475\\nTELEPHONE: (212) 474-1000\\n\\nDANIEL L MOSLE\\nGREGORY M. SHAW\\nPETR S. WILSON\\n.JAMES C. VARDELL, m\\n\\nFACSIMILE: (212) 474-3700\\n\\nROBERT H. BAON\\nKEVN .J. GREHA\\n\\nCnYOINT\\nONE RDPEMAKER STEET\\nLONDON Eca 9HR\\n\\nW. CLAYTON .JOHNSON\\n\\nSTPHEN S. MAEN\\n\\nC. ALN PARR\\n\\nTELEPHONE: 44-207-453- 1000\\nFACSIMILE: 44-207- 860-1150\\n\\nMA S. ROENBERG\\nWILUAM B. BRANAN\\n\\nPET T. BABUR\\nSADRA C. GOLDSTEIN\\nPAUL MICHALKI\\n\\nJUUE T. SPELLMAN\\n\\nRONAL CAI\\nMAK I. GREENE\\n\\nTHOMA Go RAFERT\\n\\nSAKIS .JEBE.IA\\n\\nRICHAD\\n\\nELBET L. GRAVER\\n\\nDAVID R. MAIOTT\\nMICHAL A. PASKIN\\n\\n.JUUE A. NORT\\n\\nANDRE.J. Pins\\n\\nSTPHEN L. BURNS\\nKATHERINE B. FORRES\\n\\nANONY L. RYAN\\n\\nMICHA S. GOLDMAN\\n\\nKEITH R. HUMMEL\\n\\nDAIEL SUFKIN\\n\\n.JES C. WOOLE\\nMICHA T. REOLD\\n\\nGEORGE E. ZOBIT\\'\\nGEORGE A. STPHAIS\\n\\n.JEFFR A. SMITH\\nROBERT I. TOWNSEND, m\\n\\nWILLM .J- WHEL, m\\n\\nSPECIA COUNSEL\\nSAMUEL C. BUTLR\\nTHOMAS D. BAR\\n\\nSCOTT A. BAHAV\\n\\nLES R. STEINBERG\\n\\nWRITER S DIRECT DIAL NUMBER\\n\\nSUSAN WEBSR\\nTIMOTHV G.\\n\\nPHIUP.J. BOECMA ,\\nROGER G. BROOKS\\n\\nWlLU V. FOGG\\n\\nDAVID MERCO\\n\\nFAiZA .J. SAED\\n\\nROWAN D. WILSON\\n\\n(212) 474- 1564\\n\\n.JOHN T. GAFNEY\\n\\nRICHAD .J. STARK\\nTHOMA E. DUNN\\n\\nOF COUNSEL\\nROBERT ROSENMAN\\n\\nCHRISTINE BESHA\\n\\nCONFENTIA TREATMNT REQUESTED\\n\\nApril 12 ,\\n\\n2004\\n\\nCarboplati\\nDear Mr. Clark:\\n\\nPursuat to Section XII , subsection (2) of the Decision and Order dated\\nApril 14, 2003 and 16 C.\\n, Bristol-Myers Squibb Company (\"BMS\") submits\\nthe enclosed agreement for the FTC\\' s review. BMS requests that the FTC issue an\\nadvisory opinon fiding that the agreement does not raise issues under Section 5 of the\\nR.\\n\\nFederal Trade\\n\\nCommssion Act.\\n\\nBMS and Teva Pharaceuticas USA, Inc.\\n\\'Teva ) wil resolve an ANA patent litigation conceg the drg Carboplati and\\nS. Patent No. 4 657 927 (the \"\\' 927 patent\"). BMS and Reseach Corporation\\nTechnologies (\"RCT\") prevailed in the distrct cour, where ingement and\\nThe agreeent, between\\n\\nenforceabilty were conceded and swnar judgment of no invaldity was entered. The\\nFederal Circuit, in a 2- 1 decision, vacated that judgment and diected that the cae be\\nremanded to the distrct cour for fuer proceeings. BMS and RCT filed a motion for\\nrehearg en bane, and the Federal Circuit is not expected to rue on that motion. The\\n927 patent is due to expire on April 14, 2004. However, BMS has filed with the FDA\\nfor pedatrc exclusivity, based on havig conducted a pediatrc clincal tral , as requested\\nby the FDA. If granted by the FDA , the pediatrc exclusivity would result in a fuer six\\nmonths of exclusivity for BMS.\\n\\nBMS and Teva have agreed , subject to regulatory review, to settle their\\ndispute on the tenns set fort in the enclosed agreement. In substance, the agreement\\nprovides that the litigation wil be dismissed and , if regulatory approval is granted , Teva\\n\\nCONFIDENTIAL\\n\\n\\x0cwill distrbute an unbraded , generc verion ofBMS\\' s product as of June 24 2004, well\\nbefore the six-month pedatrc exclusivity would expire.\\nWe repectfy submit tht\\n\\nths agreeent is both pro-competive\\n\\nand\\n\\nfuy consistet with the spirt of Section xn of the Decsion and Order. We therefore\\n\\nrequest a favorable detertion ftom the FTC.\\n\\nTo aid the FTC\\' s evaluation of ths request, I am enclosing the followig\\n\\nmaterals:\\nS. Patent No. 4 657, 927;\\n\\nMemorandum Opinon and Order Bristol-Mver Squibb Company\\nand Reseach Corporation Technologies. Inc. v. Pharacheme\\nA. No. 01- 3751 (MLC) (D. J. July 29, 2002);\\n\\nB.V..\\n\\nFinal Judgment Bristol-Myers Squibb Company and Reseach\\nCorporation Technologies. Inc. v. Pharacheme B.V.. A. No.\\n01- 3751 (MC).(D. J. Oct. 22 , 2002);\\n\\nBristol-Mvers Squibb Company and Research\\nCorporation Technologies. Inc. v. Pharacheme B.V. , Appeal No.\\n03- 1077 (Fed. Cir. Mar. 17, 2004);\\n\\nDecision,\\n\\nand\\n\\nCarboplati for Injection Distrbution Agreement (April 8, 2004);\\nLetter ITom Robert L. Baechtold to Clerk of U. S. Cour of Appeals\\n\\nfor the Federal Circuit (April 8 , 2004).\\n\\nAs time is of the essence, we respectfly request expedted treatment of\\nths request. The FTC\\' s response is requested as soon as possible and before June 10,\\n2004. Due to the tie-sensitive natue of ths agreement, its implementation will not be\\npossible without such expedited review.\\n\\nConfidential treatment of this letter and the enclosed materials is\\nrespectfully requested.\\n\\nCONFIDENTIAL\\n\\n\\x0cIf you have any questions, pleae do not hesitate to ca me at the number\\nabove.\\n\\nThan you in advance for your consideration and assistace.\\n\\nResectfy,\\na;J\\n\\nRichard J. Stak\\nDonald Clark, Seceta\\n\\nFederal Trade Commssion\\nth Street and\\n\\nPennylvana Avenue, N.\\nWashigton, DC 20580\\n\\nEncIs.\\n\\nBY FEDERA EXPRESS\\nCopy wi Encls. to:\\n\\nAne Schenof, Esq.\\nBureau. of Competition\\n\\nFederal Trade Commssion\\n601 New Jersey Avenue, N.\\nWashigton , DC 20580\\n\\nBY FEDERAL EXPRESS\\n\\nCONFIDENTIA\\n\\n\\x0c\"\" e\\n\\nUnited States ,Patent (19)\\n\\n(11) Patent Num\\n(45) Date of Patent:\\n\\nCleae et ale\\n(54) MANATO PLATI COMPOUNS\\n(75)\\n\\nInventors: Mich\\n\\nJ. Clea James D.\\n\\n. Hoeel Batt Rosenbe\\nLore Van Cap, aU of Bat\\nMich.\\n\\nLag.\\n\\n(73) Asgnee:\\n\\nRe\\nY.\\n\\nCorptiOD, New Yark\\n\\nU.s. CL .................................................. 514\/492\\n514\/492\\n\\n(S?\\n\\nAttomey Agent, or\\n\\nPres\\n\\nFirm-Sculy, Scott Murhy &\\n\\nABCI\\ncotion compunds an a\\n\\nsee\\n\\noced\\n\\nRelted U.s. AppUc:tiOD Data\\norSer. No. 902,706,\\n\\n1987\\n\\nmethod of treag magnt tuors\\nto a plna ds pltium (D codition copound or an\\nd2s3 platium (I cordtion compound\\n\\n(22) Filed: \\' Ma 25, 1983\\n\\n(51)\\n\\nApr. 14,\\n\\nFid of Sech ........................ 424\/287;\\nPrma Exminer-Jerome D. Goldrg\\n(58)\\n\\nMaonto plaum\\n\\n(21) AppL No. : 497,806\\n\\n(62) Divion\\n\\n(52)\\n\\n657,927\\n\\nMay 4, 1978, abandoned.\\n\\nInt. CJ4 .......................................... A61K 31\/28\\n\\nan of a solution of theadon\\ncompound.\\ncompri the paente\\n\\nCl\\n\\nNo\\n\\nDrwi\\n\\nto an\\n\\nafecte\\n\\n\\x0c657, 927\\nMAONATO\\n\\nnum(I fors d2s3\\n\\nPLATI COMPOUNS\\n\\n. The\\n\\nTh is a Diviona, of Application Ser. No. 902,\\nfied .May 4, 1978, abanoned\\n\\nBACKGROUN OF TH\\n\\ncoordtion compounds which\\n\\nhave an octaed argement in\\n\\ncooron compounds of the invention in-\\n\\nof pIa um(l and pIatthe bidentate maonat ligad\\nwhich may be substute or\\nThe\\n\\nelude th\\n\\nINON\\n\\nci and\\n\\ntr iser\\n\\nnum(I which cota\\nmaonato ligad may\\n\\nthe grup constig\\n\\nUDUbstu\\n\\ncota substituents seecte from\\n\\noflowe all, (e.g., methyl, etyl.\\n\\nchemotherpy.\\nSUMY\\nINON nylethyl(bl),\\n4-o-I-bute,\\nThe present invention relates to novel maonato plati-\\n\\nnum coordition compounds and\\n\\nto thei us in cacer n-propyl,\\n\\nispropyl. n-butyl,\\n\\netc.); arl,\\n\\n(e.g. , phenyl;\\n\\n10 lower all- , lower alyl-, hao-, ni, lower\\n\\nOF TH\\n\\n2-(I-nhtyl)metyl); alyl,\\n\\nIS\\n\\n(P1(D,.OOb-d\\n\\n), an hydrox. Al\\n\\nethoxy, et.\\n\\nsuible ar the 1.1, I-cyclo-\\n\\ncycloaylenedca1i acds, (e.g\"\\n\\nwherein:\\nx=\\ny= 1\\n1 or\\nor 2;\\n2:\\nci or\\n\\nalyl) cycloal, (e.g., cyclopropyl, cyclohexl, etc.); cycloaJyl, (e.g., 2-cclopente- yl, 2-cyclohexen- I-yl); atxy, (e.g., meoxy,\\n\\nCQrdintion com- (e.g\"\\n\\nhavig the formul:\\n\\nThe invention provides platium\\n\\npounds\\n\\naloxy-\\n\\nsubsttu phenyl and nahthyl); arykyl, (e.g. phe-\\n\\ntn(P(lA\"(oo2-j)yLzI\\n\\npropaedcaboxylic acd, l, l-cyclobutaedcaboxylic\\n\\naci, etc) and the l, l-cycloayldicaboxylic\\n\\n20 (e.g., 1,\\n\\n1-cyclopropeedcaxylic acid,\\n\\nacds\\n1,\\n\\ncyclobutenedicaxylic acd, etc)\\n\\nThe cordtion compounds of the invention\\nor heterconta two monodenta amoni or\\n\\npri\\n\\nlids\\n\\nocyclic ame\\ni.e., when x in th abve formul\\n2S is 2 or one bidentate ame liuid\" i.e., when x is 1.\\nz=O, 1 or 2, provide tht when, y=2. z=O and when\\ne monodentateame ligands incl e lower\\ny= 1. z is greate th 0;\\n(e.g., Jiethyl-, etyl-, n-propyI-, ISpropyl, Rand RI are selected from the group constig onl, , alyl\\netc), arl\\nes, (e.g., ane), amlower alyl, arl.\\nalenyl, cycloal, cy- , n-\\n\\narl,\\n\\ncloalyl, aloxy, OH, or are combined with the\\' kyl.\\n\\nam\\nl-aes\\n\\nbel;e),\\netholae,\\n\\names (e.g.,\\n\\nhydro\\n\\nlower\\n\\nall\\n\\n8D1ae, etc), hycabon atom\\'to form a cycloayl or cycloalkenyl 30 ames (\\n(e.g., metoxylalower\\nalox~l\\names\\ndervaties\\ngroup, and substitUted\\nes (e.g., methox~ethylawhen x= 1, A is HRzN-CHR3-CHRsH and JIe, etc.),\\netc.), and h:teocycli anes (e. ., pyn me\\nwhen x 2, A i!\\nheteocyclic ame or\\no acds, Le.,\\nazdi). Alo mcl ed ar the\\namo acid, wherei R2, R3, R4and Rsare the\\n\\nthereof; xylae, xyl\\nan II\\nsae\\n\\nH:z a\\n\\nall\\n\\nor diert and are seected from the group con- 35 R7-cZ-COOH wherem R7 IS H, lower\\n(e.g., metyl, ispropyl, etc.), hydrxy lower alyl (e.g.,\\nfH, CIl, C:zs, hydrxy and lower\\nsig\\nprovided tht R2 and Rs\\n\\nmay also be arl\\n\\naloxy\\n\\nor\\n\\nkyl, an eab Rs is the sae or dierent\\n\\naryl (e.g., be-\\n\\nar- hydroxyethyl , hydroxyethyl, etc.\\n\\nand is\\n\\nzyl, e,tc.\\nIt IS, to be\\n\\n. the cor\\n\\ntio com-\\n\\nl\\'oo tht\\nmvention may mclude two Identica or\\n\\'\\now\\noxy\\nlhd\\nxyl ames aloxyJalaes where,a1 dierent monoentate liga\\n\\nselec frm ,the group consistig of H, lower\\nl h\\n\\nl gro\\n\\nS8d\\n\\nlow\\n\\nps\\n\\nI 40 poundS of the\\n\\ner\\n\\npr\\nCo\\n\\n\\' Sutale bidentate am ligads\\nheterocy- tute\\nan UDubs.\\n\\nd ,\\n\\nalls\\n\\nd.\\n\\ninclude th suti-\\n\\nand seda\\n\\nclic subst\\ncludg S8\\n. a nng member\\nethylenedes. One or both of the cabon atoms of\\nwhen z= 1, L !5 a bldentate amom\\nsubstDents such as\\n45 the ethylenede may\\nwhen. z=2, .L IS a monodentate amomc li\\nlower\\n(e.g., methyl, etyl), hydrxyl, aloxy (e.g.,\\nts\\n\\nd, and\\n\\nall\\non\\' and methox,\\netylenes\\nethoxy, et).\\nors setive to a where\\nsubone or more of the ame grup\\npla dsp2 plaum(l coordtion\\nato of the\\nsttuts suh as1i abve for the\\ntium(I codi\\ned dZs\\nmpoun 50\\n(, e.g,\\name and arl (e.g., phenyl) mid\\nm.\\ncom\\n. an\\nTh mvention . also\\n\\ng ma\\n\\nmethod for\\n\\nSec co\\nca arl\\npr\\nadg\\nto\\nuti sped her\\nt tuor a solution\\ncordion\\n\\nate to a co\\n\\ncopoun or\\n\\nan\\n\\nconta\\nan\\n\\ng paent\\n\\nected\\n\\num\\n\\nap\\n\\nfied hereiove\\n\\ncord\\n\\nsuch a\\n\\nbel) may also be\\nThe Pt(l\\n\\nn C?mpound as\\' de-\\n\\ndo not\\n\\ncompounds\\n\\nex as geometr iser; however, the\\n\\nex as ci an tr isme It is to\\nunderoo tht the inventin is inlusve of\\nth cis an tr is\\nThe\\ncordaton compounds may al con-\\n\\nm an amount s1iClent to cause re- Pt(I coPQunds\\n\\ngreson of the tuor.\\n\\nTH\\nINNTION\\nS5\\n\\nDETAIED DESCRON OF\\n\\nbe fuer\\n\\nPt\\n\\nmonodentate or one bidentate anonc liga\\ni.e., wher\\npounds and metod for where ony on maonato ligad is\\nthCU proucon are descnbe by J. C. Bai, Jr., The 60 y=1 in the abve\\nChemi of the CordlUtin Compond\\nSJble monodentate anonic ligas include chloPublig Co., N.Y., 1956, Chap. 2; J: Lewi et al, ride, bromde, iode, nitrte, hydroXde, nitrte suMOt Cordnaton Chemistr: Prcip1e and Method\\nmae, etc. Among the bidentate anonic ligads which\\nInteience Publier, Inc., N.Y., 1960 and\\nmay be prest are oxate pyrophosphate ditboxaInorgan Synthes\\n7, McGrw-Hi Book Co., Inc., 65 late\\nta two\\n\\nlatium ~ordiation\\n\\nReiold\\n\\nforul\\n\\nY., 1963.\\n\\npret,\\n\\nKaufan\\n\\nPlatium(l forms\\n\\ndsp2 coordition\\n\\nwhich have a liquie pla argement\\n\\nIt is to be unertoo tht the invention includes\\ncompounds those cordition compounds contag mied mono-\\n\\nin space. Plati- denta anonic ligads\\n\\n\\x0c3\\'\\n\\nThe preferr compounds ar thos\\n\\n657, 927\\n\\ndilved\\nneutr with a soluton ofKOH\\ne.,\\nin wat\\nrestig pota\\nethyl- (- 13 g in 30 ml) to pH\\n\\nwherein R and Maonic acid (13 g-a twofold exce)\\n\\nRl in the above formula ar Ii methyl or\\n\\nethyl, i.\\n\\nmaonatoplatium methylmonatoplatium and\\n\\nwas\\n\\n(30 m1 and\\n\\nS-. The\\n\\nmalonap1aum cordaton compounds The most maouate soluton was added to the platium contag\\ncompounds ar those maonato- 5 fitrte and the mitu wa cafuy wared (to avoid\\nof th\\nunti whte\\nbumping ) on the hot\\nplatium(I compoun of the above formul\\nto form in\\nproduc\\nqu. Th\\nx;= 1 and R:z R3, R4and Rs ar eab H, Le.,\\n\\nprefer Pt(l\\n\\nwher \" st\\nmana\\nthylenede platium(l, mety1monato wa then\\n\\ncooled to\\n\\ncr\\nplgr\\nrom tepetu and ihe prouct\\n\\nthylenedep1aum(l an ethy1m0nato fiteed off The fitrte was reeaed for 5- 10 mite\\nthylenediAmineplaum(I and , wher x=2 and eah 10 an cooled to O\\' C. to collec a fuer cr. The crde\\nwas 20. 5 g (93%).\\nR6 is Ii ie., maonato tiiAmmin eplatium(I, methyl- yield at th\\n\\nstwas\\nby dilvig in boDepltium(l and ethyl-ingTheor prouct\\nnea boilg wate. The above yield (20.\\nboilg wate for comple\\nPt compounds are those wherein reui\\nis H an y=2, ieo bisonato (or bisc- 15 diolution. Maonic acid\\n\\nrec\\n\\neplatium(I.\\n\\nmaonatodiAmmmin\\nmaonatodiAmmin\\n\\n(I.\\nThe prefered\\nx=2, eah R6\\n\\nthylm0n or bisylmonao)\\n\\ndie\\n\\n5 g)\\n\\nabout 3 lite of\\n\\ngI was dilved in\\nplatium- wate to suppres any hydrolys-. The fitered solution\\n\\nwa coled to O.\\n\\niIll\\nneglgi\\n\\nC. to give white\\n\\nnufy neees (18.25\\n\\nThe cordition compounds of the invention may be f,- 83%).\\ncoducvity slWes have shown th hydrlys\\npreped by one of a vaty of wel-known methods A . U. vi\\n20\\ngener method of prepaon of the Pt(I\\n5 . Th\\ncompounds hav- The crytas decmpose be\\ntion compounds is as fonows:\\nstrtu o e prouct wa !enfi CIa an 1. r. ecis\\nI,\\nCI\\nor\\ning th formul ci(P a()iJ wherei Ha\\nroduct IS low m cold wate, I.e.,\\nSolubilty of the\\nDr an A is one bidentate or two monodenta\\n. C. and\\n20\\nmg\/l00\\nmls\\nat\\n20\\nligads (preared by the method of S. C. Dha India : mplOO O:s\\n37 C; b\\n93 (1970)) ar reted wi siver 25 hi\\n: Cbem., Vol. 8, p.\\nwa (:O\\'\\nr I00\\'\\n, .C )- 0 65 g\/100\\ner\\nm\\nnea\\nthe diaquo . complex. Th latt !S\\nmtrate to .\\n. mi.\\nrecte WIth the maonate Ion to form the coordon\\ntiedy bemen\\nel\\ntion wa ven\\n. os\\'\\nmethod is repre- e. emp comp\\ncompoun. of the invention.\\nanysIS:\\nsen y e 110 noWlg rection sc\\nMaonato di\"mmineplatium(U(P(N3n(C31204))\\nCaculted for C3HaN204PC: 10.88; H: 2.43; N: 8.46:\\ncist\\nS4; Pt 58.\\nPt 58. 9. Found C: 10. 67; H: 2. 35; N:\\n\\ncordi-\\n\\nSt\\n\\name tr.\\n\\nfor\\n\\nTh\\n\\nte b th\\n\\neme: 30\\n\\n0g\\nTh ir\\n\\nACI2I+ZAgN03+2H20)A(H20b)(N03n+ZAgC\\n\\nc:Pt A(H20)z(N03n+H2C-COO!21P\\n+2H20\\nA(OOCJ2CH2I+2N03\\n\\nwher A is one bidentate ame\\n\\ndentae ame ligads.\\n\\nee\\n\\nEXLE\\n\\n35 (Peu)(CI0.))(en = H2N(CHmNH:z\\n\\nligand or two mono- C40;- = 02CCCHvo-\\n\\ninvention.\\n\\nThe fonowing non-litig exples ar ilustratve Silver nitrte (3. 64 g) was dilved in 20 ml of wate\\nof the methods for preparg the compounds of the and added to (P2)2(CH2bCL2J (3. 5 g) supeed in\\n\\n40 wate (30 mI) in a coni flas The mitue was\\non a war hot pla for . 5-10 miute unti al the yel-\\n\\nEXALE\\n\\nlow platium complex\\n\\ntw\\n\\npreitcl\\n\\n(P(N3n(C3HzO.))\\n\\nReactions: .\\n\\nlP3nCI2I + ZAgN03\\n\\n+\\n\\nha dilved to give a yelow\\n\\nliquor plus a copious white sive choride prepitte\\nThe mire was fiteed thugh a fie pore fiter and\\n45 the\\nwith sm volum of hot\\nwasbed\\nwas adde to an\\nfitrte plus\\nwate. The\\naqueo solution of methy1monc acd (2 g in 20 ml).\\nwhich ha bee adjuste to\\' pH 5-6; The mie wa\\nheate to about SO\\' C. for fie miute and then coled\\n50 to O\\' C. The shy whi\\nwhich formed wer\\n\\nep1aum(l\\n\\nMaonatoiAmm\\n\\nwags\\n\\ncry\\nwat an actone\\n\\n2H20)--\\n\\nfied and wased with cold\\n\\n(Yied\\n\\n(P3n(H20b)(N03) + ZACl 2. 65 g). The mother liuor plus aqus wags wa\\nreduce to about ha its Drgi volume (- 30 ml) to\\n\\nII\\n\\n2-\\n\\n(P(N:!(H20)i!(N03n + CJH20.\\n\\nyield a seond crop on cooli\\n\\n55 Tota\\n\\n(P3)Z(CJHzo.)) + 2N03\\n\\n- + 210. wa reryli\\n\\ng-sghtly les th the stoicho- pore\\n\\nto O\\' C. (Yeld\\n\\nfrom a mium volume of boilg\\n\\nwater (around 250 ml) with fitrtion\\n\\nmetrc amount in order to avoid silver,\\n\\nwas dilved\\n\\npror to coolig to O.\\n\\ncontaon) leaets 2.96 g (74%).\\nin waer (50 mI) and added to 60\\n\\nSilver nitrte (22.55\\n\\nThe\\nfl\\nwi\\n\\n85\\n\\nCre yid wa 3. 50 gm (88%). The colex\\n\\nfite\\n\\nthough a\\n\\nC. Yield of\\n\\nshy white\\n\\nCacuiteforC612 1204PC:19.4IH3. 26N:7. 5S.\\n\\nFound C: 19. 11 H 3. 61 N: 7.89.\\nte\\nrapid A send crp (0. 33 g-8%) wa obtaed by reducig\\ned (60. C?) on a\\nents were w\\nCCn\\nunti the siver chlonde precpittion was\\nthe bul of the mother liquor.\\n\\n(P(N3)2C12J (20 g) in a 250 ml conica\\n\\nstg\\n\\nplet and the mother liquor\\n\\ncom-\\n\\nwas alost colorles. \\'Ie\\n\\nsiver choride wa fitere off usg a fie\\n\\npore sintered 65\\n\\nglas fiter and the preipitate was wased sever\\nwith hot water to give a tota fitrte volume of\\n\\nEXLE\\n\\nties\\n\\n10020\\n\\nInJP IV(N3n(ma\\n\\n\\x0c657, 927\\nSilver nite\\n\\n(5.45\\n\\ndilved in watr (30 ml) of solvent. a fie dion\\n\\ng)\\n\\nan\\n\\nan adde to U\\'S (P(N3nC4)\\n(30 ml) contag\\n\\nwas prear\\n\\nof the dose\\n\\n(3 g) suended in neeed for the tet. Thus some of our tes rests were\\nnitrc acd (3 obtaed on\\nwher a slur of the compoun\\n. ml). The conte wer wared on a hot pla (70. - SOo. Was injecte. Tbes ar so note in Table I below. In\\nC.) an\\nfor at lea one hour. Th\\nwas S addition, for some of the copounds, ther wa injecte\\n\\nconce\\n\\nmie\\n\\nfitered though a fie poe site gl fite\\nmove th siver chloride. Th precpitate wa\\n\\nto re-\\n\\nI ml of solutiou, either in one\\nwaed inabut2 injecons\\ngiven a few hour ap of I ml eah.\\n\\nsigle injection or\\n\\ncl fi-\\n\\ngi\\n\\ntwce with a sm volume of hot wa. The\\nin 4 diert dos\\nThes injections were intiy\\nofb 1M KCI level for eah neW compound with 6 mice in ea dos\\nwasgs was tete with a\\nif exce siver chorde was pre- 10 level. Th te cover, a doS rage frm a low ineCsolutons to\\nent. (I the te is\\nsufcient KCJ is added drop- fecve dos to an uppe dos level which prouce\\nthe bul solutin unti no siver choride is pre- . some\\nwie\\nwith the tie peod of the experent.\\nand the fitrte The reults ar set fort in Table I.\\ncipitate) Th soution was\\nreuce to 2030 mJ in volume and cooled to O. C. to TABLE I\\nyield ple yelow crsts (preumly\\nr Actvity (for\\n&0 a I!\\nmr\\n(P3n(N03)4D. Thes wer waed with a litte. Tes(Dof\\ncopouad or aD oced d\\nplum (I\\n.\\nporon\\nCO d wate and en actone\\n(Yeld\\ncoiD copo ofMato an Sl1tolc MaonalO\\nth yid (1 g) was diolved in a mium of\\n\\' CoiDli Coplce ofPIum\\nSw white\\nTumr-5 180 Ao.FeintrPCtoney\\nto which soum nitrte (0.2 g) ha be added.\\nSie inleons on daYS noted\\ninto an aquens soluton of maonic 20\\nsoluton was\\nNo. or\\nacid (0. g-a slght exce) which ha be adjuste to Cordon\\ny o.f\\nTIC\\nIDJecn Dos\\nof\\npH 5-6 with sodium hydrxide. Whe\\n10\\nthe complex qucky form on colig. These were\\nIS mglg\\n(II)\\ntere off and wased with cold wate and actone.\\n20 mgg\\n2S mgg\\n(Yield 0.7 g1\/6\\n30 mgg\\nCaculted \\'Cor\\nloN20sP C: 16.63 H 2. 33 N: 6.47.\\n616\\n40 mgl\\nFound a 16. 60 a 2,64 N: 6.80, \\'\\n5\/6\\nSO mslg\\n6\/6\\n60\\nCONFORMTION\\ntrte plus\\n\\ndr\\n\\ndee\\npoe,\\n\\nde\\n\\nrefte\\n\\ntr\\n\\nTh\\n\\nIe\\n\\ncord\\n\\nhot wate\\n\\nfite\\n\\nCompl\\nnucrst fi- Mllo,nod.\\n\\n76\\n38\\n64\\n31\\n\\n30-%).\\n\\nGEN STUCT\\n\\nTh maonate group is shown to be \\'cordiated\\n\\nthe platium by the obsed\\n\\ndays 1-\\n\\ncha in the elonic\\n\\nspe on going from the aquo to the maonate spees. MeI 1m\\nstrtuconf\\n\\':\\':\\n(I\\nda Simly,\\nHI0)\\n\\nsuch as (P(N3)2(H20)z2(H2C304))\\nThus,\\nthe anytca\\nar rued out\\nsupport a neutr 3S\\nze-tie conductivity\\ncompound. The Lr. spectra show the prece of coor-\\n\\nmeaents\\n\\ndiat caxyl grups (1601650 em and 140\\ncm- l) with no C02H grups (whih would show at\\n\\nstes.\\nte\\n\\n17001750 em). Finy the carboxyl grup vibrations\\n\\nar copab\"ble\\n\\nwi a che1te strctu\\n\\noxaate complexes of kno\\n\\nas\\n\\n(SohniOD in\\n\\nsa\\nco\\n\\nth teg\\n\\ndite\\n\\ngr si tr\\n\\nplated by\\n\\nousy, in new\\n\\nax leon,\\n\\nsutae-\\n\\nmi The mice were, on the averge S5\\non\\n\\ny 10. The\\n\\nweghed and the rati\\nmice in the trea\\n\\nprpylea\\n::\\n\\nmin\\n\\npla (D\\n\\n\\';;1:;\\n\\n, 3S\\n\\n3D\\n\\n)um\\n\\nratio in Table i.\\n\\nfi\\n\\'wa freshly diolved in st\\nthe\\n\\nTIC\\n\\nFor the\\n\\nan\\n\\ncompound maonatoylenedialati (l\\n\\nditied wate and\\n\\nin-\\n\\njec intrperitoeay on day 1 iltO eah of the te 6S\\nmice Tbe volume of the iJection was usuay i ml. In\\nin order to get an active dose into the ansome\\nwas not soluble in th amount\\nma wher the\\n\\nca\\n\\nchem\\n\\nSO\\n\\n60\\n\\nmgg\\n\\n90\\n\\n3D\\n\\n40\\n\\nmgl\\n\\nSO\\n\\n60 mgl\\n\\n70 mgg\\n\\nby 100, is given as\\n\\nset of tets the codition\\n\\n40\\n\\n70 mglg\\n\\ntuors m (soloton_1I\\nin HI0)\\n\\nto the cool set of\\n\\nwa obtaed Th ratio, multilic;\\n\\n138\\n\\nplum (D\\n\\nors wee exciBld\\n\\nof the Weights of the\\n\\n616\\n\\n100\\n110\\n120\\n\\napproxitey four wee old an weied 18-20\\nTakg day 0\\' as th day of implat. th\\n\\ngrsace\\n\\n3\/6\\n\\nO:\\':\"Pla tium\\n\\napproxitey 10 mImelYIm\\n\\nil the lef\\n\\n60\\n\\n100\\n120\\n\\nund usg our\\n\\nth im-\\n\\nmg\\n\\nmgl\\n70 mgg\\nSO mgg\\n\\ndilalium (U\\n\\nfor\\n\\nas set by the Natona Cace Intute\\nfor\\n(Cancer Chemthy Rep.. 2S (1962)). ,\\nFor these te an S ISO tuor taen from a sariced SO\\nfree of supuous tiue and cut\\nmouse was\\nunder sterie COdion intO\\npiec Thes tie pice wer\\n\\n40\\n\\nmaoDBIoeylene.\\n\\n180 tuor in maonl,2\\ntuor, soli\\nstda scrg\\nwhite mice, foUowig stdad protocols\\n\\nfeme Swi\\n\\n7 mglg\\n\\n30 mglg\\n\\n124\\n\\nThe compounds of the mv tion wer\\nto a pla ds\\nantituor actvity, i., for\\nplaum(I conitiou compound or an octaedra\\n\\nd2s platium(I codition\\n\\nmgl\\n\\n6 mgg\\n\\n80 mglg\\n\\ncompar to\\n\\nsetivi\\n\\nmg\\n\\nDaiy for\\n\\n(soluliD in HI0)\\n\\nto 30\\n\\n(sotolion in HI0)\\n\\n80 mgl\\n\\n10 mglg\\n\\n20 mgg\\n\\n40 mglg\\n4S mglg\\nSO mglg\\nS5\\n\\n60 mgg\\n\\n80 mslg\\n\\n3\/6\\n3\/6\\n\\n\\x0c657, 927\\nTABLE m-cntiued\\n\\nTABLE l-cntiue\\n\\nTes of AD Ac:\\n(I cordtion cound or\\n\\ncordintion c:poun\\n\\noc\\nMao\\n\\nAcy\\n\\n(for sevity\\nConlirmlory Tes of Antior\\nds2 platinm (11) cordtion compo or aD\\ncound)\\nDlatimn aV)\\n\\n(for setivity 10 a I!Ia ds plawn\\ndZsp3 plaum\\nan\\nand SubslDled Maonalo\\nof\\n\\n., Inbon\\nDo coon\\n\\nCordon\\nCoplex\\nI-clobutca- I\\n\\nSinRi injecns on dayS nole.\\n\\nSirde iniecn Dav Iin\\n\\nintrlOeaY\\n\\nNo. of\\n\\nDay or\\n\\nilection\\n\\nDos\\n\\nTIC\\n\\n20 mgl\\n\\n40\\n60 mg\/g\\n\\nboxyla\\n\\nplti (U)\\n\\nSO\\n\\n100\\n120\\n\\nmi\/\\nmgl\\n\\n160 mg\/g\\n80 mglg\\n\\nmanalob\\n\\n(metylae) platium\\n\\n100\\n\\nms\/\\n\\nISO\\n\\nmgl\\n\\n120 mglg\\n140 mglg\\n160 mglg\\n\\n71\\n60\\n38\\n42\\n69\\n18\\n62\\n58\\n53\\n28\\n15\\n17\\n19\\n\\npla\\n\\n15\\n20 100\\n40\\n94\\n20\\n100 100\\n\\nCompJces or Platium\\nConln\\n180 Anl-Feme Sw while mice\\n\\nTuor-Sma\\n\\n10 a\\n\\noced d2s\\n\\n0i Inpeeay\\n\\nSO\\n\\n160\\n\\nTum ADIPC6 - An\\n\\nSlnlde\\n\\n- Mous\\n\\ninie Day 15 in ou Intreay\\n\\n500\\n\\ne an maon\\ncomplexes of plaum(I were subdie\\n20 ethylene\\nmi to the Drug Resh an Development Brach\\nSamples of the\\n\\nrli\"mmin\\n\\nmaonato\\n\\nsc\\n\\nfor antiof the Natonal Cacer Intute for\\nIn addition to th day 1 injections des\"bed above, in\\ntuor\\nin\\nmice.\\nThe rethe\\nL1210\\nmor\\nactvity\\na number of cae injections were delyed unti day 8 of\\nth tumor syste are shown in Table\\nobtaed\\non\\nsuits\\nusualy\\nat\\ntuor\\nwas\\nthe\\nthese\\ntuor. grwt. In\\nthe acvity of the compounds of the\\nleat lager tha ! gm, as estite by palpation. The 2S IV. They\\ninvention.\\nwere then injecte and observed for a perod of\\nby the, \\'\\nTABLE IV\\n. approxiately 60 days. Activi was\\nwhose tuors ha regresed to the\\nnumber of\\nCoumory Tes of AntilDor Acvity (for sevity 10 a JlIa\\n\\naga\\n\\nca\\n\\nan\\n\\nconf\\n\\nmeur\\n\\nII\\n\\nanal\\n\\nthe\\nvang point, whie sti alowig\\nte results ar desn\\'bed 30\\nvive for th tie perod Such\\n\\nto sur-\\n\\nin TABLE n below.\\n, TABLE n\\nTcs of Lae Sama ISO Reesas by MaoD8o Coinon\\nComplexes or Pltium.\\n\\nCoorn\\nComplex Do\\nmaDBdi- mgg\\n\\nTuor-Sarma 180 . Anal-Fee Swi while\\nSinlde iniecons on Day Ii intrpelonealy in H20 solutions\\n\\nTota Numbe\\nof\\n\\nReons\\n\\nmgl\\n18mg\\nmg\/g\\nmaonbylene- 40 mg\/g\\nmgl\\nmg\/g\\nameplatum (n)\\n\\nCoon\\nCoplcx\\n3S\\n\\nDos\\n12.5\\nSO\\n\\ndiaeplanum (U)\\n\\n15\\n\\n% Incr in\\n\\nmgl\\nmgl\\n\\n115\\n101\\n\\n160\\n\\nMaonloylele-\\n\\n37. 5\\n\\n(re te)\\n\\n16. mgl\\n\\n151\\n121\\n\\nmglg\\n\\n15 mgl\\n11\\n\\nLies\\n\\n163\\n133\\n\\n12.5 mgg\\n\\ndieplaum (I\\n\\n45\\n\\nIntrlOealv\\n\\n50 mgl\\n15 mgl\\n\\nMalonaloi-\\n\\nMaonaylen\\n\\n14\\n16\\n\\nAD - Mi\\n\\nDaiy iniecons Days 1-9.\\n\\n, ameplllum CD\\n\\nDeth\\n\\nIi mgl\\n\\nplatium\\n\\nTuor: LI210\\n\\n20\\n\\ndilatium (I\\n\\noced d2s\\ncompoun\\n(I\\neonln\\nal th Nation Cace lnlDe.\\n\\nds2 platinm (I cordion compom or aD\\n\\n196\\n\\nIQJ\\n\\nmgl\\n\\n145\\n\\nSO\\n\\ncordition compoun of\\nar preferly dilved or sused\\nThe rets decn\"bed in Tables I and n indicate\\ny acptale\\nr or other phanuti\\nthe compounds of the invention are ver Potet antito- \\'Y\\ncopotion\\nwbite mice. 6qmds The par\\n\\nCa\\n\\nmor agents agait\\n\\nthe S 180\\n\\ntht\\n\\nThe maonatolaum\\n\\nthe invention\\n\\nadble\\n\\ntuor in Sw\\n\\nabut 0.5 mg to abut 10\\nactivity agt\\nCotory tets of antior\\nunder\\nth the amout may\\nbeg\\nmg\\nper\\nmi,\\nit\\nin rats and the ADJIPWaler 256\\nupn\\nthe\\npacu copound\\ninti\\ntes\\nva\\ngry\\ndepg\\nC6A tuor in mice were conducte. The\\nto\\nbe\\nan\\nemployed\\nand\\nthe\\nresults are shown in Table II and CO the potent The platum cordon compounds of the invenaction of the copounds of the invention agt these\\n55 tion are preferbly aded paenteray to an an-\\n\\nother tuor\\n\\nsys\\n\\nmagnt tur seve\\nTABLE II\\nna ds pltium(D cordtion\\n1;la\\n\\nDos co\\nTes or An\\n\\nor Acvity (for setivity 10 a\\n\\neonlon COd or an oced d\\'s\\ncomll)\\n(I\\n% ln\"bti Dea\\nOIlommln o:lalium\\nAn Tuor: Wal 156\\n\\n\"\" plunum (U\\nDlatinnm\\n\\nma afecte with a\\noctaed d2sp\\n\\nto a pl-\\n\\ncompound or an\\n\\npJtium(I cordition com\\n\\nund.\\n\\ne oron 0 trtment and the do level, of cour\\n60 wi dep in eah ca upon the si of the hos an-\\n\\nRa\\nmg 100\\n100\\n100\\nRal\\n\\nCaosIntr!llOeay .\\n20 mg\/g\\nSinlde iniecon Day I in 0i,\\n\\n10\\n\\nthe SO should preferaly\\n\\n(:nta from\\n\\n(I\\n\\nma, nat and si\\n\\nof the tuor, et. Geeray, howabout 20 to abut 200 mglg\\never, a dose level of\\nof boy weight, per day wi be sucient. It is to be\\n\\nfr\\n\\nundertood, however, tht the\\n\\nplatium cordion\\n\\n65 copowlIls compouned with a suitale pbautica caer in the sae proportons as recte abve may\\noray at the sae dosage level.\\nMalonlhyleaediaep1aum (I aloWebe cla:\\n\\nTmnor: Walke 256 Caosma\\n\\n- Anal -\\n\\nadmed\\n\\n\\x0c, 4, 657, 927\\n\\nmetod Cor\\n\\ntreatig\\n\\nto a pla ds p1aum(l\\n\\nmagnant tuors\\n\\nan octaed d2s platium(I\\npoun in\\n\\naoan\\n\\niserg to - an\\na solution\\n\\ngrup contig of\\n\\nsenstive\\n\\ncordion copound or\\n\\names and aloxyl all\\n\\ncoordition com.\\n\\npantey ad-\\n\\nwhich CQmpries\\nafecte with sa magnt tuor 5\\ncom-\\n\\ntion to an\\n\\npound of the formul:\\n\\ntive to a\\npound , or\\n\\n(P(IOOcn!J\\n\\nliad-\\n\\nan\\nafec\\npla\\n\\nwith a maigt\\n\\nth\\n\\ntuor sen-\\n\\ndsp platium(l cordition com-\\n\\nan\\n\\noced d2 plaum(l cord- phacay act-\\n\\nthe formul\\n\\ntr (P(IA\"((OOI),L\\n\\nz=O, 1 or 2, provide th when\\nwhe y= I, Z is greater\\n\\ncound of\\n\\n(P\"(OOJI\\n\\ny=2, z=O, and CI or I1 (P(JV)\"((ood\"L\\n\\n\\'\\nerem.\\nofH. 20 wh\\nx=\\n1\\nor 2:\\nlower all, lil.\\naJenyl, cycloal. cy- y=l or\\ncloaJyl, aloxy, OH and cOmbine with the\\nbon atom to form a cycloayl or cycloalenyl z=O, I or 2, p\\n\\nRand RI are seeced from the group constig\\n\\narl,\\n\\n2:\\n\\nca-\\n\\noV1ded tht when y=2, z=O, and\\n\\nfr th\\nthe grUP\\noCH,\\neny cyc oalkyl, cy-\\n\\nwhen y= I, Z IS greate\\n\\nRand RI ar\\n\\n\\': 1, A is HR2N-CHR3-CII-NRsH and 2S\\n\\nwherin\\n\\nwhen\\n\\nam;\\n\\n10 tion coound comprig a\\nable caer and a platium coordon\\n\\nwher:\\nx=1\\ny= Ior\\nor2;\\n2;\\n0:\\ngrUp\\'\\nci or\\n\\nar1,\\n\\nwhen z= 1, L is a bidenta anoDic\\nand\\nwhen z=2, L is a monodentate anonc ligad.\\n3. A compoon suble for patera\\n\\ncotag in an amount sufcient to cause\\n\\nregron of the tumor a platium cordition\\n\\nH, lower alyl, arl,\\n\\nhydrxy lower all, hydroxyl- and aloxyl;\\n\\nselected\\nlower alyl. arl, arl,\\n\\nconstig\\n\\nwhen x=2, A is H2NR or an amino acd;\\nR:z R. R4 and Rs ar the sae or dierent and are cloal.Yl, aIoxy, QH an cobme With the cabon\\nto form a cycloall or eyeloayl\\nseecte from the gronp Consg\\noC\\nC2Hs-. bycloxand lower aloxy, provided tht group:\\nNRsH IId\\n:z-CHR3R2 and Rs may al be arl or aryl and each R6 30 when x= I, A IS\\nwhen x=2, A IS H2NR or an amo aCd; where\\nis the sae or diferent and is selec frm\\nR:z R3, R4 an Rs ar the\\ne f:r\\nerent and\\noC H, lower alyl, arl.\\ngroup consistig\\nseleced from the group cOnsg of H, CH.\\nhydroxy lower all, hydroxy- and aloxyl-\\n\\nH, CH3,\\n\\n. and aloxyl\\n\\nthe\\naryl.\\names\\n\\nall ames\\nligand.\\n\\nato\\n\\nC2Hs, hydroxy and lower aloxy, provided tht\\n\\nbe arl or aryl an each R6\\n2 and Rs may\\nwhen z= I, L is a bidentBte anonic ligad, and 35\\nIS the sae. o! dierent and 18 selecte from the\\nwhen z=2, L is a monodentae anoDic\\noC H, lower all. arl.\\n2. A method for treatig magnant tuors sentive group CODStig\\nalkoxylxy lower all, hY\\'!xylto a pla dsplatium(l\\ncompound or\\names an aloxyl all ames;\\nan octedr d2s platium(I\\nwhen z= 1, L is a bidente anoDic ligad,\\npound in,\\nwhich compri ory\\n\\nanaoafec\\n\\ncotion com40\\n\\nadteg\\na solu- when z=2, L is\\n\\nmalignant tuor\\n\\nthe formu1\\n\\nto an\\n\\nan arl,\\n\\ncordon\\n\\nwith sad\\n\\nbe\\n\\nmonod anonic lid,\\n\\nsad\\n\\nprest in an amount sucient to\\ntion contag\\' in an amount sucient to ca reg- compound\\ncaus regron of sad tuor.\\nsion of the tUor a plaum cordation compound oC\\n4S\\n\\n(PIA.OO-c!J\\n\\n4. A compoon sutable for or adtrtion\\nwith a magnt tuor setie to a\\nplan ds platium(l cordtion copoun or an\\nan\\n\\nan afec\\n\\noctaed d2s3\\n\\nplatium(I cotion\\n\\ncomprig a pbauticaY\\n\\nci or\\n\\np1aum cordtion compound of the formul\\n\\ntr (P(OOC)2-CRI),\\n\\nwherei:\\nx=1 or 2;\\ny=1 or 2;\\nz=O, I or 2, provided\\n\\ntht\\n\\nlower 8l1, arl.\\n\\n(POOh-RRJI\\n, or\\n\\nwhen y=2, z=O, and\\n\\ngrte th\\n\\nwhen y= I, z is\\nRand Rl arc seec from the grup\\n\\ncompound\\n\\nactale caer and a\\n\\nconsg ofH,\\n\\ntr (P(I(00-cJ)\"L\\n\\nwherei:\\nx=l or 2:\\n\\naryl, a1yl, eycloal, oy-\\n\\ncloalenyl, al, OH and cobine with the ca-\\n\\ny=l or\\n\\nbon atom to form a cyeloa11 or eycloaenyl 60\\n\\nz=O, I or 2, provided tht when y=2, z=O, and\\n\\nwhe y= I, z is grte th\\n\\ngrup;\\nwhen x= 1, A is HR2N-CHR3-C-NRsH and\\n\\nwhen x=2, A is H2NR or an amo acid; wherin\\nR2. R3, R4 and Rs are the sae or dierent and\\nseecte from the group\\nof H, CH3,\\nC2Hs, hydroxy an lower aloxy, provided that\\nR2 and Rs may al be arl or arl an eah R6\\nis the sae or dierent aud is selec from the\\n\\nconsg\\n\\nRand Rl ar\\n\\ngrup consg\\n\\nseleced from the\\nlower alyl, arl. aryl, a1yl,\\n\\noCH,\\ncyeloal. ey-\\n\\neloayl, aloxy, OH and combine with the ca65\\n\\nbon atom to form a cycloa11 or\\n\\ngroup:\\n\\ncycloalenyl\\n\\nNRsH and\\nCHacd: wherein\\n\\nwhen x= 1, A is HR2N-CH3when x=2, A is H2NR6 or an amo\\n\\n\\x0c657,927\\nR20 11, R4 and Rs\\n\\nar the sam or\\n\\ndierent and are\\n\\nselecte frm th grup consg of\\n\\nH, CH3,\\n\\nC2Hs, hydrxy and lower aloxy, provided\\nR2 an Rs may alo be arl or arkyl an eah Re\\n\\nseec from th\\n\\nis the sae or dieret and is\\ngrup consstg of H, lower all,\\n\\narl,\\n\\naryl,\\n\\nhydroxy lower alyl,\\n\\nhydroxyl- and aloxyl-\\n\\names and aloxyl all amesj\\nwhen z= I, L is a bideta anonic ligad, and\\n. when z=2, L is a monodenta anonc liga sa\\ncompound beg pret in an amount sucient to\\n\\ncaus reeson of sad\\n\\ntuor.\\n\\n\\x0cfV\\n\\nUNITED STATES PATENT AND TRADEMARK OFFICE\\n\\nCERTIFICATE OF CORRECTION\\nPATENT NO.\\n\\n657, 927\\n\\nDATED\\n\\nApril 14, 1987\\n\\nINVENTOA(S) :\\n\\nMichael J. Cleare\\n\\net al.\\n\\nIt is certified that error appears in the above-identified patent and that said Letters Patent is hereby\\ncorrected as,shown below:\\n\\nNo.\\n\\nOn the title - page, bracket 62: \" Division of Ser.\\nshould read as\\n902, 706, May 4, 1978, abandoned.\\n\\n--Division of Ser. No. 902, 706\" May 4, 1978, abandoned\\nN. 778, 955 filed March 18,\\nwhich is a divisional of U.\\n1977 now Patent No. 4, 140, 707 which is a Continuation of\\nN. 260, 989 filed June 8, 1972 now abandoned.\\n\\nSigned and Sealed thi\\nSeventh Day of March, 1989\\nAttest:\\nDONALD J. QUIGG\\nAlestig Offcer\\n\\nCommissioner of PatenlS and Traemarks\\n\\n\\x0c\"\\'\\'\\'1\\n.I,\\n\\nIVI c.\"\\'\\'\\'\\'\\'\\'T I I. ...J rnA\\n\\nIo! Io! c: I tI\\n\\nI-lTPATRICK N,\\n\\nq::::l\\n\\nIt 005\/011\\n\\nV.\\n\\n1.\\n\\nORIGINAL\\n\\nUN\\' STATES DISCT COURT\\n\\nJUL 2 9\\n\\n. FORTBDISCtOFNEWJEY\\nT.\\n\\nWf\\\\H.\\n\\nMY SQUIB COMPAN )\\n\\niNC..\\n\\nBRISTOL-\\n\\nan REEACH CORPORATION )\\nTEOLOGIB,\\nPlaitis,\\n\\nCIV AciQN\\n\\nNo. 01-3751 (MC)\\n\\nENRED\\n\\nPHACHE B.\\n))efdat.\\n\\n\\'JUl\\n\\n2\"\\n\\nlOO\\n\\n\\\\L.\\n\\nWU T. WAL.\\n\\n(i)\\n\\nMEMQRAUM OPINON .A ORDER\\n\\ntn co\\n\\nbcfhre the Cour punuat to Deendat Pbaceme\\n\\n\\'Phaacheme ) motion for paal sumuy judgen and\\n\\n;I.\\n\\nBrstol:.Myem Sqob\\n\\nPllli,,\\n\\ncrss.moton for\\nRese Cmption Technologies, 1Dc.1s (\"Th\\'RCT\\')\\nCounba\\nre an\\nof3S\\nU.\\njudent on \\'t Bpcail\\np8\\nconsder th me1xa of law and supportng docents submtt by RCT U1 BM ao\\nCompy\\'s\\n\\nsu\\n\\nBMS\") an\\n\\nc. i 121.\\n\\nabve isss. At\\nPhcheme. and on Mach 4. 200 th Cour hea ma aren\\nri\"g. th Courntedin favoofBCT an BMS. 1h mem1:\\nconclusion\\nOPWOJ se fort th reevt fa1B an concluons unciedyig the Co\\'s decisin.\\non the\\n\\nofth\\n\\nPhcleme a1o moved for sun og1eQt\\n1he ar RCT ard BMS apposed Pbatcbe s motioD for pa\\non\\n\\nrcga buf did not\\n\\nof thes issues unti a\\n\\n!h patnt-insui\\\\\\n\\ncross.moe fo\\n\\nTh Co wiR, dck reutOl\\njudgttb\\nhe. coed or\\nth an Pbache\\' tifor\\niss th :rle t1OIe aeed with\\'U pre.\\nSPmP\"\\'\\n\\nis\\nin\\nlevel of skill in\\n\\nMa,.\/r\"\\n\\ntbe retevam ar an, tbe\\n\\npar suuy judent\\n\\non\\n\\nofs1 in\\n\\nar and\\n\\nswnarJudgmcm in this\\n\\nof\\n\\nar is\\n\\nto beUerundcd,\\n\\n$m\\n\\n\\x0cW\"\\'r\\n\\nI OJ, c....... I 1.\\n\\n..0 r fiA\\n\\nI\\': I\\': L. ItS\\n\\nFITPATRICK N.\\n\\nft 008\/011\\n\\nV.\\n\\nBACKGROUN\\n\\nPlaitiff RCT and BM fied a complaitln th\\n\\nCo on\\n\\n8 201 al\\n\\nAu\\nPhad1\\nofU s. Patet 1-o. 4.651,\\ninemt\\nth assgn md BM is th\\n\\n\\'97\\n. RCT\\nexclusve licc oftbe 1927\\nTh .claims of th \\'97\\nto meOds of1teatg\\nwith\\npla!,nm\\ncolexes\\nsueb plti-con coex.\\n927\\n\\nby\\n\\n. is\\n\\ntuor\\n\\npat ar\\n\\npa is\\nen\\n\\npJica\\n\\npror\\n\\ncm.f an Abbed New Drg ApPn\\n(\"FDA \" seg aproval to ra\\nc:DPJa\\n\\nnt fi oftb w1\\nANA\\n,itlnfm\\n\\ntm1iQD\\n\\nis a\\n\\npatnt exir.\\n\\n\\'I of\\' anY\\n\\nto exir in Apr 2004; itha not be the sujec\\n\\n2S sceded\\n\\nohcn uner the Ha-Waxan Act.\\n\\npharrru1cb\\nprdua\\n\\nce\\n\\nce1Diqon\\n\\nin 1987 an\\n\\nlitgaon or\\n\\nFoo 8n Drg\\n\\npa :oon\\n927 C\\'te\\n\\nTha\\n\\n271(e)(2)(A).\\n\\nANA\" wi 11 U.S. .\\na powd for injection\\n\\nplatium-cordti coex before the \\'927\\n\\nfoam th bass fo\\n\\nths lawsui\\n\\npur to 35\\n\\n. U.\\n\\nC.\\n\\nPhheue b,as aserd tht th 1927 pat is fxrvald for\\n\\nAmong oth deeue,\\nobviouSlestype double pati\\n\\nov u. s. Patet No. 4 130,,707 (\"th 707 pat\\'j.\\n, 1979 anexixd on Aug 24\" 1998. The\\nThe sae origiaplieati ficd. 0. June 8 . 1972 1h laC ri to th \\' 927 p\"en\\n\\npatcisueonz;ebr\\'\\n\\nTh 1 701\\n\\n707p1htc from\\n\\nPhheme moved for suar\\n\\npa\\nc;nta.\\nergud th 35 V. C. f . 121 do\\n\\njudgm th th ba to obvusnes-te doube\\nnotsply in ths ca. In r\\nRCI\" an 9MS\\nI\\'\" eme frm\\nan prccludes.\\npaen\\n\\nj, 3S u.s.c. A 121 does\\n\\nas a refeen\\n\\naply\\n\\npant. Neith pa:other\\n\\nagns th\\n\\nder and does not addr,\\n\\nus\\n\\n.uove o\\n\\nthe\\n\\n701\\n\\nand ths Cour ha not\\n\\nas obviUs-we double\\nt 35 U.8.C. ti 121\\nPh&nachemc fr usin th 707 pat as a. rqerce ag1he \\' \\'\/7\\nPba\\nobviousess-ty doube patg defe is precuded in th cae, Phache,u\\' s moton is\\n\\npaentig deen. Beuse th\\n\\nmeritS ofPharacheme\\'s\\n\\nCOur agees with RCT an BMB\\n\\npat,\\n\\ndeni\\n\\nan RCTs and BMSls mouan is gted. 3\\n\\nPhuachemie suequcy:fed\\n\\na second ANAfor an iDecle fo\\n\\nRCT Bn BMS fied a sepate acon\\n1270)\\n\\ntbs\\n\\nni re\\nwi\\n\\ntQ\\n\\nof carbo\\nand\\naga Phaxhemie in ths dict (Ca\\'No.\\nOI-CV..\\n\\nth.AA. Tht acton ha sie bee consoda wi th cas an\\n\\nis aplile to \\'\\n\\nboth acons.\\n\\nTh jces enteed into a 10int Stpuon and\\nclai\\nfr th\\n\\nce\\nes an\\n\\nelimed\\nthe\\n\\nbeau\\n\\nde&e, only the ise of\\n\\nfi defbar\\nn 121\\n\\nOrer\"\\n\\nefve as o Ap2\\n\\n2002\\n\\nth ha\\n\\nlitigan. Du to th\\naged to by\\nobvonss-tye doUble\\n\\nPhhes\\n\\n.igemen remains in ths cae.\\n\\npag\\n\\n\\x0c, r;.....,\\n\\nII.\\n\\nILIL Llti \\'f:J:J\\n\\n..\\\\3 r n\/\\\\\\n\\nt-lII\"AIRlCK N.\\n\\nIgOO7l011\\n\\n1\"\\n\\nPROSECUON HISTORY\\n\\n!he fats\\n\\ngc\\n\\nprseon L1ry of\\n\\n1ega\\n\\npares disput\\n\\nthorough reew\\n\\nof th\\n\\nan 1707 paen\\n\\n9T\\n\\nprseCUon\\n\\napplicaty of3S U .\\n\\ni 121 in\\n\\n. and\\n\\nC.\\n\\n121 at\\n\\npripa\\n\\nca\\n\\nTh invenrs of th 1 927 pa-in-\\n\\nfa\\n\\nnecat\\n\\nOJgi\\n\\n\"tanar\\'\\n\\nppltin on June 8.\\nclai\\n\\npat a\\n989. aplicaton\\' \\'1 con.Wag\\nCOmpitOl. In its\\nDt\\nmethod of\\nTratl-JlY\\'\\\\: Ofce (ItPTO\") issued a rescton requi\\nto!? U.S. Pat an\\n\\nnube 260 989.\\n\\n1972 (seal\\n\\ncounds\\n\\ncoiltaied in the\\n\\n1h fact ar unc1sput (thou the\\n\\neni\"ed in 1f pron lU).\\ndete the\\nis WBan and\\n\\nbi\\n\\n\\'tis\\n\\n1I.\\n\\n3S\\n\\nto the applcabilit of\\n\\nsiguica of cer\\n\\nthe\\n\\nsut fied\\n\\nfibeee\\n\\nphaceca\\n\\nto\\n\\nOffce Action\"\\n\\nnovel\\nphacal:poti\\nfollowi inventil1: 1. Cls 1-8 whch\\noter. (\"Resct is reui bet\\nis\\nclasfied\\nin\\nla 9- whch &t drwn to\\nco\\'Uds whCh\\n\\nco\\\\Dda on 1h on h8n and\\ndmwn 1:\\n\\ncomposition an\\n\\nmeod of\\n\\nOf Ac;\\nSI Th appli\\nEx A to\\n\\ntr\\n\\nof1rc:t an\\n\\nAme.\\n\\nth pro made\\n\\ntraten am\\n\\n13\\n\\nClass 260. ll.\\n\\ncacer wbk is clasied in Clas\\n\\n424.\" Jan: 11, \\' 1913\\n\\navan Decl. at 2).\\n\\natt \\'\\\\essfly\\nAmndent\\n\\nFeD. 12; 191)\\n(8u\\nSx. H to Cavan Dec) in ord to\\ne.g.,\\n\\nti\\n\\non the:\\n\\n1he\\n\\nphcs\\noosition\\nntinu to cbenge\\n\"Fin\" th restction\\n\\nRquienent\\n\\nori\\n\\nto trver$e the\\nrectin\\'1equient\\nEx. r 10 CaVa Del.; July 13, 1973\\nall ofthei\\nin a smo pateL\\n\\ncla\\n\\nobt\\n\\nft\\n\\narng copounds\\nmetods of\\n(Aprll!8. 197 Off Aet Ex 010 caV\\n\\nDe.\\n(luJy\\n13\\nreon\\n.\\n1913\\n.\\nxeuicnt.\\nreson :r\\nAmenen Ex H to Cavan:De.). B er\"\"ge\\npplicts\\npms\\nineJy\\ncompoun\\nclai.\\nThe\\nth\\ne1e\\napnc.tsproSe1id\\nprvisonay\\nat 2):,;te appficats\\n\\nthe:\\n\\nof the\\n\\nted to\\n\\ncoPOQDi!\\n\\nclai with the PTO bot did not jrodiatly obt\\n\\na1\\n\\nl1 th\\n\\nfo aDY ofthci\\n\\nWbe an apeal of the rejecon of applicants compund cla wa\\n\\npe\\n\\nclai.\\n\\nthe applicats chose to fie a coua\\na1 numbe 778 955. l\\nBo oCPatcn\\ntipl1:1tion th apcats\\ncontion ; Ex Q 10 Cava Decl. Af fig\\nabadone th orgi \\' 989 applicaton thus moog th pen apea Beca the\\nwith\\n\\nthe\\n\\n\\'9SS\\n\\napca\\n\\ncontion Wo abaDi the 989 apcati \"t \"955\\nef as thugh fi on the Jun 8. , 19 ppodty dae oftbe origi\\n\\nfied the\\n\\n, contnuaon ba the sae\\n989 apllciatan an ha\\nSst!\\n\\napcaon\\n\\n35 U.\\n\\n1977\\n\\nOn Augu\\nAmong oth\\n\\ne dIec in hr\\n\\ntb(,,\\n\\nof\\n\\nc. i 120 an Dote 4\\n\\nntiDn;\\n\\ninfa.\\n\\nth PT maed its fh\\n\\nth Offce Action se fort a\\n\\ngrs\\n\\nthe praseon:oftht\\n\\nOfce\\n\\nAction OD th \\'955\\n\\nconttiOD.\\n\\nfur r=strcto: reemt. a fOur-Way\\n\\nof compun. (E R to Cava De!. at 2). ExR1er Helen\\nrecton amon\\n:pmine\\nr of the \\' 9.55 cotiuaon.\\ntb! Offee AcOD\\nwa 1ht PT\\nan\\namendmen\\non\\nSeptebe\\n7,\\n1977,\\nin\\nwhch\\nth prvia1Y\\'\\naplicants\\nat 3-4)\\nComPun ft tw of th foar, grups. (Ex. S to Cavan\\nproseGUon, the applieats therreivcd a nonce of alowance ofthej compoun\\n. Apr 28 1978 (E Vto\\n\\nsutt\\n\\nAf reeivi\\n\\nDe\\n\\nCavanDel.).\\n\\nAf.\\n\\nSne\\nclco\\n\\ncls\\n\\n\\x0c- -- r\\n\\n\"\"\"\"\"\"\"T\\n\\nI I. U rnl\\\\\\n\\nFIT PATRICK N.\\n\\n1l:1l: l:\/t! q:J:J\\n\\n\/tOOS\/Oll\\n\\nclcla.\\neX\\nplum\\n\\n:f \\'\\n\\ndi\\n\\ncompoun\\nissue in th \\' 707 patt.\\napplicants\\napplictiQJl to thir nOn\\nted\\n\\'Tis di siGna appllcato se n1l\\n902,\\n706\\nthe\\n706 dii lo\"\\' wa filed,on Ma14\\n, 1978.. In th ti Offce Actan in the 706 divi\\nne Sn= (who ba\\nrtpnAti)\\nthe\\n9SS\\nbeen\\nbetee\\nCOlnples EU method ofus an\\ncomptions.\\n(Augu 17, 1978\\nAcon; Ex. Z to\\nDeal at 2). The\\nBefor\\n\\nst th II(r)estc:\\nI\\'n\\npbautca\\nOfe\\nCav\\naplica ag at.\\nUDy\\n\\'be\\nth\\nrcStcton teuient\\n4a Se.pte\\n(E. AA to Ca.va Dec.\\nobta cla cagores th weno\\naIow\\n.A fu precon. apRcats ffed an dioDa apli\\n10 (\"t \\'\\nto\\n\\n1978\\n\\nin JD Amendment\\nin\\n\\n). so as to\\n\\nyet\\n\\nthe\\n\\nwmber 497\\n\\nThe \\' 806 divion \\'W tU on\\n1983 (E BB\\nCa Dcc.)1 M(I preim amenem wa Bl 0i1u 21\\n.\\n1983.\\nCC\\nto Cava\\n(E.\\nDe.). In a fi Ofce.AcoD date Aug 3.: 1984,. thPTO\\n806 divisiona\" ).\\n\\n1D\\n\\nMa\\n\\nre that \"Rescton. . . is\\ncl\\ndraw to a pla comlex\\ncosiODS. (E DD to\\n\\nr.ed nnder Secon 121\" bet\\n\" JDtbods ofus 8n\\n\\nprecof\\nme\\n\\npat\\n\\n2S.\\n\\npharace\\n\\n1: ,phacutca\\n198\\'.\\nth ajUC8 r\\n\\nan clai drwn to \\'\\n\\nCa De). at 2). Af\\n\\na IJtice of allo\\n\\nand\\nisued on Apdl 14\\n\\nSTANAR FOR.\\n\\ncla.\\n\\nin e.,Jun 21.\\n\\ncopositlol1\\n\\n1985\\n\\n(E. EB to\\n\\nOff Acton\\n\\nCav Dee!.). Th\\n\\n1 927\\n\\nS:uY.1GMB\\n\\nab\\n\\nllm\\n\\njwlgJcnt is apprprat where the is an\\nof a\\nmet an the movi par is cntitle( to judgment as a\\nmatt\\nof la. FedCi... S6(c);\\nCfl reA Corp.\\nV. GaITen 477 U. S. 317, 327 (1986).\\nWh\\nbothpaerMOv.\" for\\nSni1\\njudgmentw the coUr mus\\nmotion QU, its OWD\\nreolvi alheaJile\\n\\neva ea\\n\\ninfece agaitb pa\\n\\nnccar ,prmid.\\n\\non\\n\\nmer\\n\\nwhose moon is 1Ddf\\n\\n\\'199 P.\\nv.het Sec 121 apJfes inu.s.\\nth\\ncais\\nmacd facts ar not in disp, tho CoUl deon a matt\\nthe fat-\\n\\n1380 (Fed. Cir. 199). Th\\nof law for the Cour Althug\\n:131\\n\\ngeui ise\\n\\ndc\\n\\nKiv.\\n\\nDn of\\n\\nintene file hitory afth \\'97 patc\\n\\nANALYSIS OF 35 US.C.\\n\\nCour grts RCTs and BMS\\'s\\n\\n, 121\\n\\njudgment 1h 3S ,V.s.C.\\n\\ncrssmotion fO\\n\\n121 apes on the facts of1b cae to ,\\nbar Phaeme.1rom\\npatem as a rocruc agans th tg27 patin-sut.\\nthe pate aplicaon\\nin light of the\\nhioty\\n\\n1b decn 1s\\'\\n\\nrelevt ca Jaw.\\n\\nSecton 121\\n\\nsrei in pereni\\n\\ning the\\n\\n0:i8, .-tb reew\\n\\n707\\n\\npm\\n\\nIf tw or more .icpent an dict ineDtcs at claied in\\none appfcatioD; th (PTO)\\nma reir th applicaon to \\'b\\n\\nrescted to on\\n\\nof\"t inventions. If th o1her invetion is mae\\ndhision application whtch complis wiCh the \\'\\nof sectin 120 of ths 1i it sb be entied to ,\\nth\\n\\nth subjcctof a\\n\\nrcuicat\\n\\ni\\n\\n\\x0c11.\\n\\nI U \/ \\'-\\n\\n;,0 r 1\\'\/\\\\\\n\\n,-\\' I\"\\n\\nHTPATRICK N.\\n\\n\"I tI q::::Z\\n\\nis\\n\\nfi\\n\\nth\\n\\nbefit of\\n\\nV,\\n\\n008\/0\\n\\ndate of th origi aplicaon.\\nwi tesct- to whch a requien for .\\n\\nn:\\n\\nse\\n\\non an app1icllon\\n\\n\\'lctn UD th\\nba be m8 or 01 an\\nas a resu ofsu a\\nsh no be us as II\\n:rerence eith in t1e))at. au Tmd\\nOBorm. th\\n\\nfi\\n\\naptin\\n\\ncour aga divioul apJiat\\n\\nor aay pa\\naplica\\ndivona\\n\\napca\\non.\\n\\nor\\n\\nissud 01 d\\n\\nis fied before\\n\\nth\\n\\nth oth 8.pp\\n\\n35 U.\\n\\nC. f 121.\\n\\nn: st\\n\\nag\\n\\nis\\n\\nr o:t\\n\\nthe\\n\\niftbe \\'\\n\\nof th\\n\\npa\\n\\norto pm ap1i\\n\\n\\' Cones ened Secon 121 as a\\nin\\nand\\npatetees ftm the\\nSee. e.g. gutZy :.pplied\\nMaterial.v. Advanced\\nInc; 98 P3d\\n(Fed Ci.\\n1996). Pror to th\\nCl wh ha beC3 suect to a I\\'Gton\\nCGlJld have its latq\\non th bas oCme fi issu patt even\\nthugh the\\nhad intiy sougtto prsee al ofib\\nSu, e.g.,\\nRBingttmRcm Bu. Sen. v. .AcmsCiJ(\/ S)s. . Co. 11 F.2d 628 (4th, Cir i:er\\'\\n293. U. S. \\'\\n62 (1934). . SecoD,121 wa\\nelmin\\n\\'1D ,tn es an ODe oftb\\nPUIse -oScc1ion 121 is I&to\\nvadity WID tbe vapdos ofthcrccton\\n\\nun\\n\\nconSeueces ofPTO restcton\\n\\nSer.lC0dutr MaerIo\\n\\nreenpa\\n\\npr\\n\\nenent\\n\\nSeon\\n\\n.4m.,\\n\\n1563,\\n\\nIS68-69\\n\\nof SectiDn 121, a\\n\\npa.ivac=\\n\\nclai toge.\\n\\neu\\n\\nth\\n\\nsagu\\n\\na ove\\n\\n121\\n\\npr\\n\\ndDed\\n\\nto\\n\\n.8 th\\n\\nthe te1mcaties of\\n\\npote\\n\\nrection prce\\n\\nar\\n\\nnot elevte from thei P1nos of\\nCXRq;\\nOD. conveence to a\\nta,OD th\\nty of\\npatents\"\\nApplied M6riQU\\nat 15689;\\nsee alo\\nS.. Rep. No 82-197 (June 27 1952):0\\n19S2U. c.C.AN. 2394\\nre171ledin\\n\\n2A13.\\n\\neng.\\n\\nIn th cas the\\n\\nfi pat\\n\\n(th \\'707\\n\\npa) \"issu( ed) on an apcati01 wi xe\\nhito as a\\n\\nwhch a requie:t for resbcton (wa) mae.,14 Fmm a reew ofthpts\\nwho it 19 evdentb me ,\\nrecli:OIl reuic:D1 A;ae in\\nthe applca to pure tbcimethod of1Jtmem an\\ncompon\\ndivcm applic.oD.\\ntescton\\ncacee&1 reoke\\n\\nIb\\n\\nPhachee 1: not offer\\n\\npba\\n\\nrequi\\n\\nan\\n\\nJU\\n\\npeve auoli in suppor of\\n\\nretrcton requiemen was cl1er excitl or\\n\\ntr\\n\\neoauleui\\n\\ncl\\norwi\\nit coteon\\n197\\n\\nimplicitly withdmwn by th\\n\\nin\\n\\nth th\\n\\nPTOs:fer\\n\\nTh is\\nfor at lea the xen. th the \\' 955 contuaon togeVtth th o\\nrd \\' 989\\naplicaon COtc n one contiou applicaton\\ntb mcag of th law.\\n68 U.s. 317) 325-26 (1863);\\na1$O 7ramo Prods.\\nOmtTm:ti\\n\\nwi\\n\\nBtes.\\n\\nfl7\\n\\n8f\\n\\n1994) (citi1D\\n\\n(Fed Cir.\\nComnote\\nSU\\nam conered pa of the sae 1ra\\ncons\\nlegie\\ninca an\\n38 F.3d 551.\\n\\nSS6wS7\\n\\nth\\n\\nth a\\n\\nhiStry of\\n\\nCourS intee1OD of\\n\\nGodf)\\n\\nOD\\n\\nQD 120 d.oe 1iot\\naplicaon\\n\\nv.\\n\\n121\\n\\nGoe:\\n\\nenct\\n\\ntb apJUOI1 01 whchit is\\none COui ap\\n. Th\\n\\non BD\\n\\nco\\n\\nco\\n\\nPerj\"\\n(\"Bef$eon\\n\\n1n\\n\\ncongrsson int,tO alte-th\\nctc?\\' \" cer tlene 513 U.S. : 151- U99.S\\\\\\n\\n\\x0c. \"\\'VI\\n\\nI ul ,\"\",V\"t\\n\\nI I -\\n\\nr\"\\'l\\\\\\n\\n1.0 1.0 \"ItS q\\n\\nFIT PAT R\\n\\nrectnr\\n\\nI.C K N. V,\\n\\nfg01o\/o11\\n\\nuieD\\\\en in the \\'955 contato an Phanacemie s arguent is beled by the\\nwhole\\nExamr\\'s Sne\\' mmen m. the fi Oft Acton on\\n106 divion COborate t\\' th rection\\ncopoim an metoa of11en an\\ncoposion\\nteJliue in eft thug the \" 55 canuaon (\"estion. .\\nhas\\ntw clai drwn to cooum an glai \"\\ncompon(s) andmes)lI :e z to Cava Dec. at 2,. On at leutfb\\noccons, \\'te\\nreiteat tbJlppUam coound\\nneed to be sep fr\\nth\\ns 1k Cour\\n1T_en and\\ncopoon\\ndiviom\\nme1h of\\nand phaacutica coposition clms was $ed as a\\napplicaon\\nof the restrction\\nwa not a \\' \\'voltItaD ac over th\\n1h\\n\\noftl pruton hiry.\\n\\nbc\\n\\npNnoa\\n\\nbe\\ncls\\nphcal tratt 1a.\\npu\\nrequen en\\n\\ndrot\\n\\nbctequ.\\npr\\n\\nre\\n\\ncou& th th\\n\\n, 11repd atts to trVCt the PTO\\' restetn\\nbi copound\\n\\nclas \\'Wth \"metod\\n\\noftrJment\\n\\nthe \\' 927 paent is fn conson\\nFu.\\napp1\\n\\nreui\\nphaceutca\\n\\nme of\\n\\nye pC1\\naplica\\ncomposition claims.\\n\\nbut wer nOt\\n\\nrestcti lC\\n\\nofpat\\ndrwn exclu.vdy to\\nrr7 paeuiu.S\\\\ co cla\\nexJ:.Jly\\ndr\\noftrateD.t &c phaeu\\n\\ndencJa\\n\\nupn by\\n\\ncontae4\\n\\nwith tbe\\n\\nJ973\\n\\n....nR fl the c)ai of e \"97 p nt do not crss ba ov th lie\\nto clai subjectma c\\nin the\\n?07 pat. \\'I= 707\\n\\neali\\n\\ncompounds. and the\\n\\nto method\\nconsoomce reqre\\'as set fort m\\n683 (Fed Ci. 1990). is met\\n\\neomposition. Thus.\\n\\nGer.her Garent Tech.. Inc.\\n\\nhe.\\n\\n\\\\I.\\n\\nLectra\\n\\nl11C.,\\n\\n916 F.2\\n\\nupon whh Phachem ba relied do not milta in -favot of a\\nCour The Court of Custobl an Pate Appal\\' detionS in 1\"\\n#3 P.2d 12U (C.\\n9\\'1)\\nwifhdialofarescton\\nrequient-n a parentapplicaon).\\n393 F 2d 1001 (C P.A 1968) (no P1:P In re Scheler 397 F. 2d 350 (C.C.P.A. , 1968) (sach do\\nimosed retrction\\nthe Coar\\' s concluson that Secon 121 aplies in\\nnot\\ncasc.\\nFiny. th caes\\n\\ncont deoiOD by th\\n\\nZfegler.\\n\\nC;P.A\\n\\nch\\n\\noffcial\\n\\n(iotvigthe\\n\\nln\\n\\nre Wl\\'!ght.\\n\\nrequiment) an\\n\\n\"t\\n\\nHer the Pr unqUvocy impo a\\n\\nsepar tb.acats\\'\\npharceca composition cbm,\\ncoua\\nne rescded tb\\nand two pate then issued (oue wi otai\\nexlusively tQ compoUD and one with clai dmwn exclusvely to ma1hod df1ttmen and\\npbsacca compositions). Sccon 121 aplies in th ca to ba th us of.tbe eBerclaims fim\\n\\nmetod of tratmen\\n\\nrcuh\\n\\nrcstiction\\n\\nand\\n\\ndr\\n\\nised 707 paen as .a refence agst the later-isue\\n\\nSee, e.\\n\\n11. 1973\\n\\nm-suit\\n\\n\\'92 paeo-\\n\\nDel.).\\n\\nOf. Action (E. E to Cavan Pee. ); Aprl 18. 1913- OBi Acton\\n\\n(E. G to Cava Deet); Mah 22. 1974 Offce Action (E I to C&V8 DeCL) an1984 Ofce Action (Ex. DD to Cava\\n\\nugll 3\\n\\n\\x0c,\"VV\"T\\n\\nI I . .. I r nl\\\\\\n\\nFITPATRICK N.\\n\\nltI q:l:ll\\n\\nI.! I.!\\n\\n0l1\/011\\n\\nV.\\n\\n1, .\\n\\nIUER\\n2.8 U\\n\\nC. S\\n\\nCereatioD\\n\\n1292(b)\\n\\ndeon on an\\nbu th ha\\niDlo0u.basls. RCT BD BMS do not join In Phl\\nr.. it Pbitil\\noPse ths Cour ceQ!oD, of an inteocury aP. I\\ns, fig th Ib cae \"ilv cotrllg\\nto apea ibs ruli on an\\nofr.pion and t1 an\\nthe is\\npoun for\\nquaniatoflaw as to whichoncr\\n.t umtey ad 1h ulti fPA ofth\\nap:fom an\\npJAnnacio h :ruest cecaon so th it may-appe\\n\\nth\\n\\ns tB\\n\\ninocn\\n\\n. lition.\"\\n\\n21 U.S.C. f 12.92(b). 1\\n\\nby the United\\n\\nbate\\n\\nsu\\n\\nnot ta\\n\\nherby cafy\\n\\nSt Cour of Appe fo\\n\\nCi\\n\\nI1\\n\\nmmrlocQ reew\\n\\nfl follwin queson fo\\n\\nthe; Fedet\\n\\nCET1\/E QUEION\\nWhre (i) th PTO found tht\\n\\ntw 01 more independet and diltict inenons wee\\n\\nrequ tb orgil aplicaoD.\\norl\\nea1iofth invenoDS \\\\ft reOE\\nbefo\\nisSUce\\nof th eaerori\\napplicaon (tii)\\npat issued fr co1111nafi: JD\\nclvicm appltion which\\nth\\n_cd pa\\n\\nclaied iD one\\n\\n. to be IC\\n\\naplicaon\"). and th PTO\\n\\napplicaon\\n\\nteci to 011\\n\\nn.; Cu)\\n\\nof the\\n\\nsubjec of a\\n\\nvc:on wa\\n\\nfu rccton\\nreen\\nieui\\nimO$ by no dung prsecuton oftbe diviional apli (\"\\nreuieDt\\'\\n1hc other\\n\\nis pa (\"dJvion\\nultite mat in\\n\\'W h\\nc:ceed reoke or withwn am\\nthe lat-\\n\\napplication\": (iv)\\n\\nthe\\n\\nDid the Disct Comt er in holding tht 35\\nasa refece\\n707\\nuse of tM eaer-\\n\\nis\\n\\'\\npat\\nba upn the followig 1eg\\n\\nrus:\\n\\nU.\\n\\n(v) a retion\\nJ. rection\\n\\nC. i 121\\n\\nag\\n\\nthe:\\n\\n8PPUes in th\\nissued \" 927 p\\n\\nto bar the\\nin-sui\\n\\nment, .\\n\\n, (1) The diviiona aplication W8 fied \\'Cas a ret of the fi IectOIl\\nwith th\\nmeing of S\\n\\non 121;\\n\\n(2) Th\\n\\nno\\n\\n1icit1 or implicitly withdr 1he fist\\n\\nrent,\\n\\nrectin requiemen by.\\n\\nan1he t\\'e\\nth la restrcln\\ncontiue to apply to the divion etplicaon far pUtge ofinwki\\ndid not\\n\\nimo\\n\\nent .\\n\\nih 1\\'cton\\n\\nSecon 121; and\\n\\n(1) The clas or1h eatlier-isueci patet. and 11 clai\\' oftb laie..jssu patnt er\\nm;Cton\\nwith th\\nfay\\n\\ncouat\\n\\nfi\\n\\nreuien ,\\n\\nSO OBEIJi:\\n\\nMA Y\\nt.\\n\\n.I\\n\\no2lJ\\n\\n\\x0c;.\\' Vul I\\n\\nUULf\\n\\n01\\n\\nI I.\\n\\nSTERNS &:\\n\\nFITPATRICK N, V.\\n\\nHI\\n\\nr 0\\'\/\\\\\\n\\n002\/0\"\\n\\nWEO\\'\\n\\nA Prafesiopal Corporation\\n\\nqRIGtNALriLE\\n\\nso Wei Sta Stm\\n\\n08607\\nTt Nl2100\\nSuite 140\\n\\n00\\'(2\\n\\n(609 392-\\n\\nKC-848\\n\\n. 0\\n\\n..:.1 .I\\n\\n\"7\\'Ct-t\\n\\ntn;T r \\'1\\\\\\n\\nfo Defedat\\nPhaceme B.\\n\\n. 1JIT1 STAms\\n\\nDlSnucr\\n\\nFOR THE DISTRICT OF NEW\\n\\n\"\":0 --\\n\\ncOI\\n.1Y\\n\\nBR,TOL-MY SQUI\\nCOMPAN -.d\\n\\nRBCH CORPORATION\\n\\nTBOLOIB, INC..\\n\\n:PJaiff\\n\\nClvIL crONNo.Ol-37\\n(Civil Action No. 02 1270\\n\\npHACHB.Deenda.\\nV..\\n\\n.\", I\\n\\nCQnsJ1da herth)\\n\\n-I\\n\\'\\n\\\\\\'l1.\\nJ\\\\\\nI,\\non\\n\\n\\':1.\\n\\nFIAL JUGME\\n\\nWHRES.. on July 29t 2002 th\\ngr\\n\\nCo\\n\\nissued a\\n\\nMemcm Opn and\\n\\njudgment for plaintiff on the mvaJd4. defeue af\\n\\nS\\\\1\\n\\natmQUSasty doubl :.\\n\\ngr1U thaI 35 U-S.C. g 121 baa 1r of U.s. Pa\\npat.\\') as a refi agait U.S. Paten No. 41)57.921 (tho en 921 pate\\nem the\\n\\nWHB, on Ocber 2\\n\\nNo.\\n\\n200 the \\' Uuite Staea\\n\\nCit deed deCen&!t Pbannacheme B.\\nappeal &om \\'t Cour\\n\\ns\\' (\\n\\n140 701\\n\\n(th\\n\\n10\\n\\n,i\\n\\nCa Appaa for th F\\nach\\nfie\\nDC\\n\\n,i\\n\\ntiOD 1C \"\\n\\nsaar jud8DC1t otder.\\n\\nWHE, the onty issue Temnilt in ths case is th -ie ofiI\\n\\n.t\\n\\nr\\'\\n\\n\\x0c\" ..v, I U,\\n\\nII,\\n\\nr fill\\n\\nFITPATRICK N.\\n\\n11:\\n\\nI\\': I\\':\\n\\nPDArnohemc. in OIer to\\n\\nW1.\\n\\nha. With the\\n\\nwrtt conse DfpIaia\\n\\nee1i its ri\\n\\n1a of the \"\\n\\nODe\\n\\nWl.\\nreain to be\\n\\nDOW\\n\\ntQ IpJlea1h\\n\\nfiled an .Aende Auer am\\n\\nth Pbhenc s fiUng of the AN.As refci\\ninmngemenf dr.at\\n\\nIg 003\/011\\n\\nV,\\n\\nth tha Amcad-= Aner an\\n\\n\\'twi\\n\\niss\\n\\nC011talaJ\\n\\ncols is an se 0\\n\\nin tho CODSUda\\n\\n27 patt md\\n\\ni 121 ba\\n\\nafrmve deeJ\\n\\nits\\n\\nes .\\n\\nfilc DO i\\n\\nCoMcJs hi\\n\\n0\\n\\ntr.\\n\\nWHOn. fi judgment be and heryis cnten as fo1iows:\\nJudent is i tavorDf\\nBMISquibb Compy on\\ndefeadat Pharhe\\nV. on its Countelai in tht U.s. Pat\\n\\nogica mc. 8I\\n\\nplatis Resh Cortion\\n\\nth\\n\\nii\\n\\nDO\\n\\nd,\\n\\nun\\n\\nas U1:u1,\\n\\nput to 35 U.\\n\\nwi the Un St\\n\\nC.\\n\\nComplai aa\\n\\n271( e)(2), and that the\\n\\nNo. 65.\/21 is DO\\n\\nemt of at J.t\\n\\nmata\\n\\nor hapomt1on into the UDtec St,\\n\\nrefe to in the Abbr&k New Dru Applications wod\\n\\npat\\n, It is fwea ordet that the cfecvo date\\n\\n\\'Ue.\\n\\nof the\\n\\nin\\n\\nto 21 U.\\n\\nC- Section\\n\\n927 paten\\nexpimon of the\\n\\nsa\\n\\n01:\\n\\nOD clam of I.\\n\\noff fo sae i\\n\\ncabolat prots\\n\\' anc clai of\\n\\nat\\n\\nnm AppIicaOl Nos. 15-162 . and 76-292 is detcd\\n\"a Dt Adm&1n exclusvity th may be\\nto ptsti\\n\\ne on\\n\\nto be the\\n\\nJ1\\n\\n3SSa\\n\\n\"Kpy sad exclusivity comiJ into efec up\\n\\nand\" if no such exclusivity is\\n\\npa1\\n\\n. a. dat\\n\\ntht\\n\\nof Phmemc\\n\\nof\\n\\nAbbratd New\\nwhlcl Nly Foo\\n\\nI\\n\\nfi of1h\\n\\np\\n\\npla proct ig an t4t of\\n\\nNow Drg Applic:an for\\ntht pateAt\\n\\nen\\n\\nConolida\\n\\npot eaer\\n\\nput\\n\\nGXirat of the .\\n\\ndu th Ap t4, 200\\n\\n\\x0c--I\\n\\n. \\'O\\n\\n1-\"\\n\\nI I, -\\'-\\' 1- nl\\\\\\n\\n10 \":J:J\\n\\nI-llt\\'AIK1CI\\\\ N,\\n\\nIg 004\/011\\n\\n, 0\\n\\nI..\\n\\ntU 0l\\n\\nn is\\n\\nIh pd to th\\n\\ntI\\n\\no\\' I\\n\\ndalo of\\n\\nAhbr New \\'Dmg Application Nos 76-162 md 76.292, dc Plthem.\\nmatin& usin& sdHn J:r oftg for-sde witb th U .\\niDto th thtec Sta. dls caJan\\ntefe to In \\'tsc\\n\\nenjoied fi tImriay\\nSte.. or\\n\\n, Abbmiated\\n\\n1icati9na oth\\n\\n\\'New Drug\\n\\nof\\n\\nth deyelopeat and\\n\\nuinf.\\n\\nUS\\n\\nth\\n\\nintou un Fect la whch\\n\\nor sae of dngs as set fort\\n\\nin\\n\\n3S U.\\n\\nMa L\\nDat! Octber\\n\\n200\\n\\nreDa rd\\n\\nte th\\n\\nc. Secn 271(e)(1). .\\n\\nle si8 -ct Jud\\n\\n\\x0cto. \"\\n\\nUnited States Court of Appeals for the Federal Circuit\\n03- 1077\\nBRISTOL- MYERS SQUIBB COMPANY\\nPlaintiff-Appellee,\\n\\nand\\nRESEARCH CORPORATION TECHNOLOGIES, INC.,\\n\\nPlaintiff-Appellee,\\n. v.\\n\\nPHARMACHEMIE B. V.,\\n\\nDefendant-Appellant.\\n\\nDavid T. Pritikin ,\\n\\nSidley Austin Brown & Wood, of Chicago , Ilinois , argued for\\nboth plaintiffs-appellees. With him on the\\nConstantine L. Trela. Jr. Lisa A.\\nSchneider\\nMarc A. Cavan\\nEUQenia S. Hansen , Sidley Austin Brown & Wood,\\nof Dallas , Texas. On the brief for plaintiff-appellee Bristol- Myers Squibb Company, was\\nRobert L. Baechtold , Fitzpatrick , Cella , Harper & Scinto , of New York , New York.\\nbrief were\\n\\n; and\\n\\n, and\\n\\nFrancis C. Lvnch , Palmer & Dodge , LLP of Boston , Massachusetts, argued for\\ndefendant-appellant. With him on the brief was\\nLaurie S. Gill.\\nAppealed from:\\n\\nUnited States District Court for the District of New Jersey\\n\\nJudge Mary L. Cooper\\n\\n\\x0c,i\\n\\nUnited States Court of Appeals for the Federal Circuit\\n\\n03- 1077\\nBRISTOL- MYERS SQUIBB COMPANY\\nPlaintiff-Appellee,\\n\\nand\\nRESEARCH CORPORATION TECHNOLOGIES, INC.\\n. Plaintiff-Appellee,\\n\\nPHARMACHEMIE B.\\n\\nDefendant-Appellant.\\nDECIDED: March 17, 2004\\n\\nBefore NEWMAN, MICHEL , and BRYSON,\\nOpinion for the court\\nNEWMAN,\\n\\nBRYSON,\\n\\nfiled by\\n\\nBRYSON,\\n\\nCircuit Judaes\\n\\nCircuit Judae\\n\\nDissenting opinion filed by\\n\\nCircuit Judae\\n\\nCircuit Judae\\n\\nThe question in this patent case is whether the patent in suit is invalid for double\\n\\npatenting. The district court held on summary judgment that an earlier patent , which\\nstemmed from the same application as the patent in suit, could not be used\\nreference against the patent in\\n\\nsuit for double patenting\\n\\nSquibb Co. v. Pharmachemie. BV. , No. 01-3751\\n\\nas a\\n\\npurposes.\\n\\nBristol- Mvers\\n\\n(MlC) (D.\\n\\nJ. July 29, 2002).\\n\\n\\x0cBecause we disagree with a key conclusion on which the district court\\' s\\n\\nsummary\\n\\njudgment was based, we vacate the district court\\' s judgment and remand the case to\\nthe district court for further proceedings.\\n\\nResearch Corporation Technologies, Inc. ,\\n\\nis the owner\\n\\nof U. S. Patent No.\\n\\n657, 927 (\"the \\' 927 patent\" ), and Bristol- Myers Squibb Co. is the exclusive licensee\\nunder that patent.\\n\\nThe patent claims (1) methods for treating malignant tumors with\\n\\ncertain platinum coordination compounds and (2) compositions containing\\n\\ncompounds in amounts sufficient to cause regression\\nPharmachemie, B.\\n\\nthose\\n\\nof those tumors. Appellant\\n\\n, filed an Abbreviated New Drug Application (\"ANDA\" ) with the\\n\\nFood and Drug Administration , seeking FDA approval to market a cancer-treating drug\\n\\ncovered by the \\' 927 patent. Research Corporation Technologies, Inc. ,\\nMyers Squibb Co. (collectively \" Bristol- Myers\\n\\nwith patent infringement under 35 U.\\n\\nC.\\n\\nand Bristol-\\n\\n) brought suit charging Pharmachemie\\n\\n271 (e)(2). As a defense ,\\n\\nPharmachemie\\n\\nasserted that the \\' 927 patent was invalid for obviousness-type double patenting over\\nS. Patent No. 4 140 707 (\"the\\n\\n\\'707 patent\" ),\\n\\nwhich was issued in 1979 and expired in\\n\\n1998.\\n\\nThe double patenting issue in this case turns on whether Bristol- Myers is entitled\\nto invoke section 121 of the Patent Act, 35 U.\\n\\nclaim of double patenting.\\n\\nThat issue\\n\\nC.\\n\\n121, as a defense against\\n\\nthe\\n\\nin turn depends on an interpretation of the\\n\\nprosecution history of the \\'707 and \\' 927 patents.\\n\\n\\x0cThe \\' 927 patent can be traced\\nTrademark Offce in 1972.\\n\\nto an\\n\\napplication filed with the Patent and\\n\\nThat application, Serial No. 260 989 (\"the \\' 989 application\\n\\ndisclosed and claimed compounds corresponding generally to the compounds that were\\nultimately claimed in the \\'707 patent. In addition, the \\' 989 application claimed methods\\nof treatment and compositions corresponding to the claims that were ultimately included\\nin the \\' 927\\n\\npatent.\\n\\nIn the course of the prosecution of the \\' 989 application, the examiners imposed\\n\\ntwo restriction requirements. The first, imposed in 1973, required\\n\\nthat the applicants\\n\\nelect either the compound claims; classified in art class 260, or the method of treatment\\nand composltjon \\' claims, classified in.,art\\n\\nclass 424. In\\n\\naddition\\n\\n, the \\' 1973 restriction\\n\\nrequirement directed the applicants to elect \" a single disclosed species for examination\\n\\non the merits. \" As a result of the 1973 restriction requirement, the applicants elected\\n\\nthe compound claims and withdrew the non-elected method of use and composition\\nclaims from further consideration at that time.\\n\\nThe examiner then rejected the elected\\n\\ncompound claims on the basis of lack of utilty.\\n\\nIn 1974 , adifferent examiner issued a second restriction requirement on the \\' 989\\n\\napplication. That restriction requirement identified four different compound groups\\nwithin the compounds claimed in the application as constituting independent and\\ndistinct inventions. The four \\' groups were: (1) \" Organometallc\\n\\nplatinum compound(s)\\n\\nclassified in class 260, subclass 429\" ; (2) \" Platinum compounds containing \\' heterocyclic\\n\\namines \\' or (\\'heterocyclic substituents \\' classified in class 260 , subclass 270R and many\\nvarious subclasses ; (3) \" Compounds of the above type with 2-valent platinum and no L\\n\\nmoiety\\n\\n; and (4) \" Compounds with 4-valent platinum containing various \\' anionic\\n\\n\\x0cligands.\"\\n\\nIn addition , the examiner expressly stated\\n\\nthat the 1973 restriction\\n\\nrequirement segregating the compound claims from the method of use and composition\\n\\nclaims was maintained. The applicants did not file a divisional application in response\\n\\nto either of the restriction requirements, but instead appealed the final rejection of the\\nclaims to the PTO Board of Appeals.\\n\\nIn 1977, while that appeal was pending,\\napplication ,\\n\\napplication.\\n\\nSerial No. 778, 955\\n\\nthe applicants filed a continuation\\n\\n(\" the \\' 955 application\\n\\n), and abandoned the \\' 989\\n\\nThe \\' 955 application presented all of the original claims of the \\' 989\\n\\napplication for examination.\\n\\nrestriction only\"\\n\\nA new examiner examined the \\' 955 application \"for\\n\\nand imposed a\\n\\nnew restriction requirement. The 1977 restriction.\\n\\nrequirement differed from the 1973 and 1974 requirements that had been imposed in\\nconnection with the \\' 989 application. The 1977 restriction requirement mandated that\\n\\nthe claims be separated into four groups, but unlike the 1973 restriction requirement, it\\n\\ndid not segregate the compound claims from the method of use\\nclaims. Instead ,\\nreferred to art\\n\\ncompounds.\\n\\nand composition\\n\\nthe first two of the four groups set forth in the restriction requirement\\n\\ngroups that included methods of use and compositions\\n\\nThe first group consisted\\n\\nplatinum compound(s)\\n\\nsubclass 429 (compounds)\\n\\nand class 424, subclass 287\\n\\ncompositions).\" The second\\n\\ngroup consisted of U (p)latinum\\n\\nclassified in class 260,\\n(methods of use and\\n\\nof U (o)rganometallc\\n\\nas well as\\n\\ncompounds containing \\' heterocyclic amines \\' or (\\'heterocyclic substituents \\' classified in\\n\\nClass 260, subclasses 270R and many various subclasses (compounds),\\n424 subclass 245 (compositions and methods of use). \"\\n1977\\n\\nand Class\\n\\nThe third group set forth in the\\n\\nestriction requirement consisted of \" (c)ompounds of the above type with 2-valent\\n\\n\\x0cplatinum and no L moiety. \" The fourth group consisted of \" (c)ompounds with 4-valent\\nplatinum containing various \\' anionic\\' ligands.\\n\\nThe applicants responded to the 1977 restriction requirement by electing four\\nclaims , which corresponded to the claims that were ultimately included in the \\'707\\npatent that issued two years later.\\n\\nBefore that patent issued, however, the applicants\\n\\nfiled a divisional application, Serial No. 902, 706 (\"the \\'706 divisional application\\n\\npreliminary amendment, the \\'706 divisional application \\'ncluded\\n\\ndenominated claims\\n\\n5- 20.\\n\\n). After\\n\\n16 claims,\\n\\nClaims 5- 13 were cancelled shortly thereafter.\\n\\nThe\\n\\nremaining claims, in slightly rewritten form, claimed the non-elected compound groups\\nand\\' the\\' methods of use and compositions originally claimed in both\\' the \\' 989 and the\\n\\n955 applications. Following the filng of the \\'706 divisional application, the \\'707 patent\\nissued, containing the four\\n\\ncompound claims that had been elected from the \\' 955\\n\\napplication.\\n\\nThe examiner issued a restriction requirement with respect to the \\'706 divisional\\n\\napplication.\\n\\nThe office action began with the statement \" Restriction has been\\n\\nrequired. . . between the following\\n\\ninventions,\\n\\n\" after which the examiner divided the\\n\\nclaims into three groups: claim 14 which is drawn to Platinum (II) complexes classified\\n\\nin Class 260, subcla$s 270R\" ; claim 15\\n\\nwhich is directed to platinum (IV) complexes\\n\\nclassified in Class 260, subclass 429R\" ;\\n\\nand claims\\n\\n16-20, \\' \\'which are\\n\\ncomposition and method (sic) classified in Class 424, subclass 245 , 287. \"\\n\\nIn\\n\\ndrafted to\\nthe same\\n\\noffice action , the examiner then set forth a second, four-way restriction requirement\\n\\nwhich replicated the four-way restriction requirement that had earlier been imposed\\n\\non\\n\\nthe claims of the \\' 955 application. The applicants responded to that office action by\\n\\n\\x0casserting that the two restriction requirements seemed to be \"somewhat in conflict\" in\\n\\nthat \" any invention elected in a cordance with the requirements (of the first) would\\nnecessarily involve election of one or more of the groups set forth (in the second). \"\\n\\nIn\\n\\nan effort to comply with the requirements, however, the applicants elected claim 14 of\\nthe \\'706 divisional application.\\n\\nIn 1983 , after further unsuccessful appellate proceedings ,\\n\\nthe applicants\\n\\nfiled\\n\\nanother divisional application , which again consisted of the original 1972 application. In\\npreliminary amendments , the applicants canceled the 13 original claims and added, as\\nclaims 14- 19,\\n\\nthe claims that had been claims 15- 20\\n\\nof the \\'706 divisional application.\\n\\nAnother examiner was assigned to the application and another\\' restriction . requirement\\'\\nwas issued. This time, the examiner divided the claims into two groups, one consisting\\n\\nof claim 14 drawn to platinum IV complexes, classified in Class 260, subclass 239E\\nand the other consisting of claims 15-\\n\\nclassified in Class 424\\n\\ndrawn to methods of use and compositions,\\n\\nsubclass 245. \" In 1987,\\n\\nthat application matured into the \\' 927\\n\\npatent. The four claims of the \\' 927 patent corresponded generally to four of the method\\nof use and composition claims of the 1983 divisional application.\\n\\nThe district court noted that the question whether section 121 of the Patent Act is\\n\\navailable to Bristol- Myers . depends on whether the applicants were required by a\\nrestriction requirement to prosecute the claims that ultimately became part of the \\' 927\\n\\npatent separately from the claims that became part of the \\'707 patent. The court\\nconcluded that the statutory requirement was satisfied because \" it is evident that the\\noriginal 1973 restriction requirement remained in effect and required the applicants to\\n\\n\\x0cpursue their method of treatment and pharmaceutical composition claims in a divisional\\n\\napplication. This restriction requirement was never cancelled, revoked. or withdrawn.\\nAccordingly, the court concluded,\\n\\nthe divisional application pursuing method\\n\\nof treatment and\\n\\npharmaceutical composition claims was filed as a result of the restriction\\nrequirement and was not a \\' \\'voluntary \\'\\' act; over the years, the applicants\\nmade repeated attempts to traverse the PTO\\' s restriction requirement but\\nwere not permitted to combine compound claims with method of treatment\\nand composition claims.\\n\\nBecause the court concluded that section 121 barred the assertion of double\\npatenting as a basis for\\n\\nPharmachemie to assert the invalidity of the \\' 927 patent, and\\n\\nbecause Pharmachemie abandoned any other, defense against Bristol- Myers \\' claim of\\ninfringement, the court\\n\\nentered final judgment\\n\\nof infringement.\\n\\nPharmachemie\\n\\nappealed.\\n\\nSection 121 of the Patent Act provides , in pertinent part , as follows:\\nIf two or !\\'ore independent and distinct inventions are claimed in\\none application, the Director may require the application to be restricted to\\n\\none of the inventions. If the other invention is made the subject of\\ndivisional application which complies with the requirements of section 120\\n(of the Patent Act) it shall be entitled to the benefi of the filng date of the\\noriginal application. A patent issuing on an application with respect to\\nwhich a requirement for restriction under this section has been made, or\\nan application filed as a result of such a requirement, shall not be used as\\n\\na reference either in the Patent and Trademark Office or in the courts\\ndivisional application or against the original application or any\\npatent issued on either of them , if the divisional application is filed before\\nthe issuance of the patent on the other application.\\n\\nagainst a\\n\\n35 U.\\n\\nC.\\n\\n121.\\n\\n\\x0cAs section 121\\n\\nhas been interpreted by this court, Bristol- Myers\\n\\ninvoke the statutory prohibition against the use of the \\'707 patent \" as\\n\\nis entitled\\n\\nto\\n\\na reference\\n\\nagainst the divisional application that resulted in the \\' 927 patent only if the divisional\\napplication was filed as a result of a restriction requirement and is consonant with that\\nrestriction requirement.\\n\\nSee Geneva Pharms.. Inc. v. Glaxosmithkline PLC , 349 F.\\nGerber Garment Tech.. Inc. v. Lectra Svs.. Inc. 916\\n\\n1373, 1378, 1381 (Fed. Gir. 2003);\\n\\n2d 683, 687 (Fed. Cir. 1990). The district court held that the divisional application\\n\\nthat led to the \\' 927 patent was filed as a result of, and was consistent with, the\\nrestriction requirement issued in 1973.\\n\\nAccording to the\\n\\ncourt, that 1973 restriction\\n\\n. requirement resulted in the 1978 divisional application that , ultimately, resulted in the\\n927 patent , because the 1973 restriction requirement \" remained in effect and required\\n\\nthe applicants to pursue their method of treatment and pharmaceutical\\nclaims in a divisional application.\\n\\ncomposition\\n\\nAlthough the 1973 restriction requirement was\\n\\nissued against the \\' 989 application, and not against the \\' 955 application , from which the\\n\\n1978 divisional was filed, the court ruled that the 1973 restriction requirement applied to\\n\\nthe later application because it \" was never cancelled, revoked, or withdrawn.\\n\\nOur review\\n\\nof the\\n\\ndistrict court\\' s\\n\\nsummary judgment\\n\\norder in this\\n\\nfactually\\n\\ncomplex case presents a relatively straightforward question: whether the district court\\n\\nwas correct to conclude, as a matter of law, that the 1973 restriction requirement was\\napplicable to the\\n\\napplication.\\n\\n1977 application and therefore\\n\\nresulted in the\\n\\n1978 divisional\\n\\n1 The district court held that it was and that the patent therefore cannol\\'\\n\\nThe dissent appears to take the position that by issuing the \\' 927 patent the PTO\\nin effect found that the applicant complied with all applicable restriction requirements,\\nand that we should not disturb that determination. In fact , however , the question\\n\\n\\x0ccited as a reference against the \\' 927 patent for double patenting\\n\\npurposes.\\n\\nPharmachemie, on the other hand, argues that the 1973 restriction requirement was not\\n\\nin effect at the time of the filng of the divisional application that matured into the \\' 927\\npatent, and that the \\' 927 patent therefore cannot be said to have been filed as a result\\nof that restriction requirement.\\n\\nWe agree with Pharmachemie. The \\' 955 continuation application , which was\\nfiled in 1977 , began a new proceeding in which all of the original claims of the \\' 989\\napplication were once again presented for examination? In 1977 , when the examiner\\nfor the \\' 955 application issued the restriction requirement for that application, she did\\n\\nI\"ot reinstate ,or\\n\\neven \\'\\n\\nadvert to the - 1973 restriction requkement. I n fact ,\\n\\nthe 1977\\n\\nrestriction requirement that she issued at the outset of the prosecution of the \\' 955\\nwhether the requirements of section 121 have been satisfied is a question of law that\\nde novo after reviewing the relevant\\nSee Geneva , 349\\nmaterials.\\n\\nwe have addressed\\n3d at 1377;\\n\\nIn re BerQ , 140 F. 3d 1428, 1432\\n\\n(Fed. Gir. 1988). The approach\\n\\nsuggested by the dissent would be inconsistent with the approach we have employed in\\nsimilar cases in the past. In Geneva , and Gerber , for example , we held that applicants\\n\\nhad failed to satisfy the requirements of section 121 based on our analysis of the\\nprosecution history. Even in cases in which we have held that the requirements of\\nsection 121 were satisfied, we did so not as a result of deference to the PTO but as a\\nresult of our own analysis of the prosecution\\nSee Symbol Techs.. Inc. v.\\nTex. Instruments Inc. v. U. S. Int\\' Trade\\nOpticon, Inc. , 935 F. 2d 1569\\nComm , 988 F. 2d 1165 (Fed. Cir. 1993).\\nhistory.\\n\\n(Fed. Gir. 1991);\\n\\n2 Bristol- Myers has not cited any statutory or regulatory basis for concluding that\\nthe 1973 restriction requirement was automatically applicable to the \\' 955 continuation.\\nBristol- Myers cites several cases and a provision (section 201. 07) of the 1972 version\\nof the Manual of Patent Examining Procedure (\" MPEP\" ) for the proposition that\\ncontinuation application and its parent are \" one continuous application , withih the\\nmeaning of the law. Godfrey v. Eames , 68 U. S. 317 , 326 (1864);\\naccord Transco\\nProds. Inc. v. Performance GontractinQ, Inc. , 38 F. 3d 551 , 556-57 (Fed. Gir. 1994).\\nThose authorities, however, do not support the proposition for which Bristol- Myers cites\\nthem. The cases deal only with the issue of priority, and not with PTO procedure for\\nexamining a continuation application in light of its parent. Likewise , the cited MPEP\\n\\n\\x0c, application\\n\\nwas different from, and inconsistent with, the 1973 restriction requirement.\\n\\nThe 1977 restriction requirement, unlike the 1973 restriction requirement ,\\n\\ngrouped\\n\\ncompounds together with methods of use and compositions in at least two of the four\\ninvention groups, while the 1973 restriction requirement directed that compounds be\\nsegregated from methods of use and compositions. Moreover, the examiner examined\\n\\nthe method of use and composition claims \"for subject matter of (the elected groups)\\nreadable on the elected species \"\\n\\nas reflected in the subsequent office action.\\n\\nThis\\n\\nsuggests that the applicant could have complied with the 1977 restriction requirement in\\n\\na way that would have been contrary to the categories set forth in the 1973 restriction\\n\\nrequirement:\\' By imposition of a new and\\' different restriction requirement and failng to\\nmake any reference to the restriction requirements imposed in\\n\\nconnection with the\\n\\nparent application , the examiner made clear that the previous restriction requirements\\ndid not carry over to the \\' 955 application.\\n\\nBristol- Myers argues that the examiner in effect adopted the 1973 restriction\\n\\nrequirement ,in the course of the prosecution of the \\' 955 application. Bristol- Myers\\nsuggests that the four-way\\n\\nrestriction requirement of 1977 incorporated the two-way\\n\\nrestriction requirement of 1973\\n\\nand thus resulted in a\\n\\nrequirement, part explicit and part implicit.\\n\\nsix- or eight-way restriction\\n\\nThere is no indication in the record,\\n\\nhowever, that the PTO intended one of the two restriction requirements imposed on the\\n\\n989 application to carry forward to the \\' 955 application , but not the other. Moreover\\n\\nthe record does not indicate that the applicant proceeded under the assumption that the\\n1973 restriction requirement continued\\n\\nin\\n\\neffect.\\n\\nDuring prosecution of the\\n\\n\\'706\\n\\nsection does not address PTO procedure for examining a continuation , but merely sets\\n\\n\\x0cdivisional application, when a restriction requirement similar to the 1973 requirement\\n\\nappeared in conjunction\\n\\nwith a\\n\\nrestriction requirement similar to the 1977 r striction\\n\\nrequirement , the applicant noted that the two requirements were \"somewhat in conflict\"\\nand that \" any invention elected in accordance with the requirements (of the first) would\\n\\nnecessarily involve election of one or more of the groups set forth (in the second).\\n\\nThere was, to say the least, some confusion at various points as to how the\\nvarious claims should be sorted out for purposes of restriction. But even though at\\n\\nsome points restriction requirements were imposed that were similar to, or even\\nidentical to, earlier restriction\\n\\nrequirements, each requirement was nevertheless\\n\\n. separately imposed with respect to each separate application.. The record thus does\\nnot support the inference that any of the various restriction requirements automatically\\ncarried forward, in part or in whole, from one application\\n\\nto the next.\\n\\nFor that reason\\n\\nwe cannot sustain the district court\\' s summary judgment order, which was based on the\\ncourt\\' s conclusion that the 1973 restriction requirement continued in effect with respect\\n\\nto the continuation application that was filed in 1977. Accordingly, we reverse\\n\\nthe\\n\\ndistrict court\\' s judgment and remand for further proceedings.\\n\\nforth the requirements of a continuation application.\\ninting to the examiner s statement, in an office action on the \\'706 divisional\\napplication, that restriction \" has been required\" between three categories of inventions,\\nBristol- Myers argues that the statement indicates the examiner considered that at least\\n\\nsome of the restriction requirements from previous applications continued to apply to\\nthe later applications. We do not agree with Bristol- Myers \\' conclusion in that regard.\\nThe examiner s isolated use of the present perfect tense,in\\na sufficient basis from which to infer that the examiner\\n\\nthe 1978 .office\\n\\naction is not\\n\\nunderstood , or intended to\\n\\nconvey, that a restriction requirement imposed five years earlier , in connection with a\\ngrandparent application , continued to be in effect for all applications related to the\\noriginal \\' 989 application because it was never formally withdrawn.\\n\\n\\x0cIn light of the complexity of the factual record in this case, we go no further than\\nto address the ground on which the district court ruled. Whether further analysis of the\\n\\nsequence of applications, restriction requirements , and responses\\n\\nby the\\n\\napplicants\\n\\nmay reveal other grounds for concluding that the protection of section 121 should be\\nextended to some or all of the claims of the \\' 927 patent is a matter for the district court\\nto address in the first instance.\\nVACATED and REMANDED.\\n\\n\\x0cUnited States Court of Appeals for the Federal Circuit\\n03- 1077\\n\\nBRISTOL- MYERS SQUIBB COMPANY\\nPlaintiff-Appellee,\\n\\nand\\nRESEARCH CORPORATION TECHNOLOGIES, INC.,\\nPlaintiff-Appellee,\\n\\nPHARMACHEMIE: B.\\n\\nDefendant-Appellant.\\n\\nCircuit JudQe , dissenting.\\n\\nNEWMAN,\\n\\nMy colleagues have peered\\nplucked out a\\n\\ndeep. into the recesses of patent examination\\n\\nroutine and unreviewable\\n\\nadministrative procedure -- the \" restriction\\n\\nrequirement\" for faciltating examination of , complex cases -- and created\\nstandard of\\n\\na\\n\\nnew\\n\\nadministrative review and a new ground of patent invalidity. I must\\n\\nrespectfully, dissent.\\n\\nWhether or not the patent applicant here in suit was given proper or consistent\\nrestriction requirements by the various examiners,\\n\\nthe issuance of these\\n\\nactions was\\n\\nentirely discretionary with the Commissioner. When the examiners accepted the\\n\\n03- 1077\\n\\n\\x0capplicantl s elections and the divisional applications filed in compliance therewith, these\\nactions are not rulings of law; they are discretionary actions reviewable , if at all, under\\n\\nthe strictures of the Administrative Procedure Act. It is not disputed that the applicant\\nmade the required election for each restriction requirement, and that the divisional and\\ncontinuing applications at issue were accepted by the examiner as properly filed. The\\n\\ndistrict court reviewed these procedures and found that 35 U.\\n\\nC.\\n\\n121 protected the\\n\\npatentee from citation of the earlier patent against the later one:\\n35 U.\\n\\nC.\\n\\n121. .\\n\\n. A patent issuing on an application\\n\\nwith\\n\\nrespect to which a requirement for restriction under this section has been\\nmade, or on an application filed as a result of such a requirement, shall\\nnot be used as a reference either in the Patent and Trademark Office or\\ntht3 courts against a, divisiona i application or against . the original\\napplication or any patent issued on either of them.\\n\\nThus the district court held that under 35 U.\\n\\nC.\\n\\n121 the patent at issue was not an\\n\\navailable reference.\\n\\nIf my colleagues on this panel now intend to require that the minutiae of the\\nvarious discretionary restriction requirements and the acceptance by the examiners of\\nthe applicant\\' s\\n\\ncompliances with those requirements are subject to appellate review , the\\n\\nstandard of review is that of the Administrative\\n\\nProcedure Act, not the\\n\\nde novo\\n\\nuntangling of internal procedures for which my colleagues remand to the district court.\\nSee Dickinson v. Zurko , 527 U. S. 150 (1999).\\n\\nThe majority opinion , in its footnote 1, misperceives my concern. The\\n\\nissue is not the standard\\n\\nof review of the agency s findings of substantive fact\\n\\nholding that li the PTO is an l agency\\' subject to the APA\\'\\nconstraints, Zurko , 527 U. S. at 1819 , the Court required that matters of agency\\nprocedure (such as whether a restriction requirement must be repeated) are delegated\\nto the agency. The APA assigns such procedures, which have no substantive impact,\\nto internal agency management; the panel majority distorts the administrative process\\ndetermining patentabilty. In\\n\\n03- 1077\\n\\n\\x0cRestriction Requirements are not Appealable within the PTO\\n\\nThe PTO has myriad procedures to guide and faciltate the conduct of patent\\nexamination.\\n\\nRules of operation are essential to the\\n\\neffective performance of a\\n\\ncomplex agency with many employees and an enormous volume of work.\\n\\nThe PTOl\\n\\npatent examination procedures fill a three- inch thick Manual of fine print. In addition\\n\\nPTO regulations fill Volume 37 of the Code of Federal Regulations.\\nscientists and engineers apply these procedures\\n\\nto the most\\n\\nOver 3500\\n\\nadvanced science and\\n\\ntechnology of the age.\\n\\nEarly in the evolution of patent examination the Patent Office adopted the\\nrestricti6i1\" practice , to , simplify the \\' search , and examination of complex\\n\\ndiscretionarY\\n\\ninventions. In electing to require \" restriction \" the patent examiner requires the applicant\\n\\nto select a specified aspect of the claimed subject matter , the examiner having first\\ndivided the subject matter into groups of cJaims\\n\\nbased on classification for search\\n\\npurposes. The applicant then selects the aspect to be examined , and usually also\\ntraverses\\n\\nthe requirement\\n\\n, a formality grounded in administrative protocols.\\n\\nExamination then proceeds as to the selected subject\\n\\nmatter.\\n\\nThe non-selected\\n\\naspects are then removed from consideration in that case; they may be rejoined or they\\n\\nmay be moved into one or more divisional applications for examination. Lest the first\\n\\npatent be citable as prior art against a divisional application -- an ilogical event that\\nin holding that the agency s\\n\\npractices in complex cases receive\\n\\n. judicial review and management.\\nexamining\\n\\nplenary\\n\\nIn 2002 the PTO received 333 688 new patent applications and granted\\n162\\n\\n221 patents.\\n\\nAccountabiliy\\n\\nSee 2002 United States Patent & Trademark Offce Performance &\\nRep. at 15. The average pendency was twenty-four months id. , and\\n\\nhundreds of thousands of applications are under examination at any given time.\\n\\n03- 1077\\n\\n\\x0c121.\\n\\napparently had occurred -- the 1952 Patent Act precluded this event by enacting\\n\\nThus the patentee was shielded from this unintended substantive consequence of an\\n\\nexamination procedural\\n\\nconvenience.\\n\\nSemiconductor Materials America. Inc. ,\\n\\nIn\\n\\nApplied Materials. Inc.\\n\\n98 F, 3d 1563\\n\\nv. Advanced\\n\\n(Fed. Cir. 1996) this\\n\\ncourt\\n\\nexplained:\\n\\nThe\\n\\n121 is\\n\\nto accommodate administrative\\nconvenience and to protect the patentee from technical flaws based on\\nthis unappealable examination practice. . .. Section 121, viewed overall,\\nassures that the technicalities of restriction practice are not elevated from\\npurpose of\\n\\ntheir purpose of examination\\n\\nconvenience to a\\n\\npotential taint on the\\n\\nvalidity of the ensuing patents.\\nkl at 1568.\\n\\nIn the present\\n\\ncase,\\n\\nfour different examiners imposed somewhat variant\\n\\nrestriction requirements, reflecting their divergent views of how the\\nshould be divided ,for\\n\\nsubject matter\\n\\nsearch and examination. Some examiners grouped all of the\\n\\nplatinum compounds together and all of the\\n\\ncancer-treatment\\n\\nuses together; another\\n\\nput the compositions with the compounds, another with the uses; another separated the\\n\\ndifferent kinds of platinum compounds; another included the corresponding composition\\n\\nand use claims with each type of platinum compound. Some required an election of\\nspecies; some did not.\\nTo each examiner\\n\\nrestriction requirement, the applicant made the requisite\\n\\nelection from among the examiner s categories, while duly \" traversing \" the requirement.\\nNone of the examiners objected to the applicant\\' s compliance with any of the restriction\\n\\nrequirements. None rejected a later filed application on an earlier on.e. None of these\\nactions is appealable to the Board of Appeals or the courts. The Court of Customs and\\n\\nPatent Appeals explained\\n\\n03- 1077\\n\\nthat a\\n\\nrestriction decision is not an actual rejection on\\n\\n\\x0cgrounds of patentabilty, but simply a procedural requirement. The court explained in\\nre Henaehold , 440 F. 2d 1395 , 1399 (CCPA 1971):\\n\\nOn considering 99121 , 132 and 134 and the intent unmistakably\\n\\nevinced\\n\\nby the clear language therein , it is evident to us that Congress. . . decided\\nnot to regard the procedure involved in matters of \" division \" or \" restriction\\nas a \" rejection. Instead, section 121 denominates restriction procedure\\nIt is apparent, then , that Congress intended to\\nas a \" requirement.\" .\\ndifferentiate between whatever requirements and objections an examiner\\nmight make on the one hand ,\\n\\nand matters involving actual rejections of\\ninsofar\\nas its provision of statutory rights of\\nclaims on the other, at least\\nappeal to the board accruing from such actions in and of themselves.\\n440 F. 2d at 1402- 03 (citations\\n\\nrequirements \"\\nnature.\\n\\nld.\\n\\nomitted). Restriction requirements are like other PTO\\n\\nthat are \" matters of a\\n\\ndiscretionary, procedural or nonsubstantive\\n\\nSee also Inre Harnisch , 631 F. 2d 716 (CCPA1980):\\n\\nat 1403.\\n\\nIn the PTO, patent applications are examined for compliance with the\\nstatutory provisions of Title 35, United States Code, as set forth in\\nsections 100, 101 , 102, 103, and 112. These are considered to be\\nexaminations \" on the merits. \" There are also procedural questions arising\\nunder section 121 and related PTO rules concerned with \" restriction\\npractice. \"\\n!! at 721.\\n\\nThe only remedy available to an applicant who is dissatisfied with the restriction\\nrequirement is a petition to the Director for review:\\n37 C.\\n\\nR. 91.\\n\\n144. After a final requirement for restriction , the applicant\\n\\nin addition to making any reply due on the remainder of the action, may\\npetition the Director to review the requirement. Petition may be deferred\\nuntil after final action- on or allowance of claims to the invention elected\\nbut must be filed not later than appeal. , A petition wil not be considered if\\nreconsideration of the requirement was not requested (see 91. 181).\\nSuch a procedure implements\\nactions.\\n\\nSee generallv\\n\\nS. 144 , 151\\n\\n03- 1077\\n\\nstandard administrative practice relative to agency\\n\\n.Mn v. Occupa\\n\\netv & Health Review Comm , 499\\n\\n(1991) (\" Because applying an agency\\n\\nregulation to\\n\\ncomplex or\\n\\n\\x0cchanging circumstances, calls upon the agency s unique expertise and policymaking\\nprerogatives , we presume that the power authoritatively to interpret its own regulations\\nis a component of the agency s delegated lawmaking powers. \"\\n\\n,. Indeed, should there be any imperfections in the agency s\\napplications of the regulations with respect to the\\n\\ncompliance by the applicant, they are not grounds of invalidity.\\n\\ninterpretations or\\n\\nexaminer\\'s theory of restriction or\\nSee Maanivision. Inc. v.\\n\\nBonneau Co. , 115 F. 3d 956 (Fed. Cir. 1997):\\n\\nProcedural lapses during examination, should they occur, do not provide\\ngrounds of invalidity. Absent proof of inequitable conduct, the examiner\\n\\nwith the internal rules of patent\\nexamination becomes irrelevant after the patent has issued.\\n\\nor the applicantl s absolute compliance\\n\\nk! at 960. Such\\n\\ninternal agency procedures are not judicially reviewable.\\n\\nSee Hvatt v.\\n\\nBoone , 146 F. 3d 1348 (Fed. Cir. 1998):\\n\\nroutine administrative procedures is presumed , and\\ndeparture therefrom, should such have occurred, is not grounds of\\nRegularity of\\n\\ncollateral attack. Courts should not readily intervene in the day-to- day\\noperations of an administrative agency, especially when the agency\\npractice is in straightforward implementation of the statute.\\nId. at 1355- 56.\\n\\nThe presumption\\n\\nof\\n\\nvalidity would collapse if the PTOl s\\n\\nadministration of the\\n\\nrestriction protocols could be turned into satellte litigation of patent-destroying\\nconsequence. In\\n\\nAmerican Hoist & Derrick Co. V. Sowa & Sons. Inc. , 725 F. 2d\\n\\n(Fed. Cir. 1984) the court referred to\\nthe deference that is due to a qualified government agency presumed to\\nhave properly done its job, which includes one or more (patent) examiners\\nwho are assumed to have some expertise in interpreting the references\\n\\nand to be familiar\\n\\nfrom their work with the level of skil in the art and\\n\\nwhose duty it is to issue only valid patents.\\nk! at 1359.\\n\\n03- 1077\\n\\n1350\\n\\n\\x0cRestriction is a Discretionary Requirement\\n\\nNo statute defines\\nauthorization of 35 U.\\n\\nthe parameters of the examiner\\n\\nC. 9121, for the subject and scope of this discretion is unrelated\\n\\nIn re Henaehold\\n\\nto patentabilty. In\\n\\ndiscretion beyond the\\n\\nthe court explained:\\n\\nThere are a host of various kinds of decisions an examiner makes in the\\nexamination proceeding -- mostly matters of a discretionary, procedural or\\nnonsubstantive nature -- which have not been and are not now appealable\\nto the board or to this court. . . (A) requirement for restriction under\\n9121 is now one of those discretionary matters no longer tantamount to a\\nrejection of the claims, . . .\\n440 F. 2d\\n\\nat 1339.\\n\\nThe entrusting of discretionarx agency pr cedures , o agency management is a\\n\\nclassical administrative practice, requiring\\n\\njudicial restraint.\\n\\nSee Vermont Yankee\\n\\nNuclear Power Corp. v. Natural Res. Def. Council, Inc. , 435 U. S. 519 (1978):\\n\\n(T)his Court has for more than four decades emphasized that the\\n\\nformulation o(procedures was basically to be left within the discretion of\\nthe agencies to which Congress had confided the responsibilty for\\n\\nsubstantive judgments.\\nId.\\n\\nat 524.\\n\\nIn\\n\\nCitizens to Preserve Overton Park. Inc. v. Volpe , 401 U. S. 402, 410\\n\\n(1971) the Court ,\\n\\ninterpreting the Administrative Procedure Act , stated that internal\\n\\nagency actions are not reviewable if either (1) Congress expressed an intent to prohibit\\njudicial review , or (2) the decision is \" committed to agency discretion.\\'1\\nUndoubtedly\\' the procedures\\n\\ncomplex.\\n\\nsurrounding restriction requirements can be\\n\\nAn entire Chapter of the Manual of Patenting Examining Procedure , is\\n\\ndevoted to it. 3\\n\\nBy statute it is\\n\\ndiscretionary, for\\n\\nits purpose is\\n\\nadministrative\\n\\nA commentator experienced in the field states: \" Many patent examiners\\nand patent practitioners are confused by restriction practice and unity of invention\\npractice in the (USPTO).\" Jon W.\\nSome Comments on \" Independent and\\nHenry,\\n\\n03- 1077\\n\\n\\x0cconvenience ,\\n\\nnot\\n\\npitfalls in substantive validity. The fact that four examiners made\\n\\nsomewhat inconsistent requirements\\n\\nfor\\n\\nrestriction does not change the controllng\\n\\nweight of the examiners \\' steady determination of the applicant\\' s compliance with their\\n\\nrequirements. A discretionary action having no substantive consequence and that is\\nunreviewable is not a ground of patent invalidity, and is not subject to collateral attack.\\n\\nRemand is Inappropriate\\nThe panel majority orders the district court to repeat its review of the restriction\\n\\nprocess , to search for flaws in the procedure, for my colleagues find it too complex for\\ntheir appellate decipherment. A complex agency record is not sound reason to discard\\nthe required agency deference , or to ask the district court to repeat what the court has\\n\\nalready done and ruled upon.\\n\\nWhatever the continuing\\n\\nforce of the\\n\\npre-Zurko\\n\\nconsonance \" cases, on which the majority relies, in this case the patents at issue were\\nthe product of restriction requirements in which the examiners accepted the applicant\\'\\n\\nelections and the ensuing divisional applications. The courts lack authority to invalidate\\n\\n(2002).\\n\\nDistinct\" Inventions of 35 U. C. \\' 121 and Unity\\nTrademark Off. Soc y 745, 748\\n\\nof Invention\\n\\n(pt. 1), 84 J. Pat.\\n\\nThe majority states by footnote that precedent requires de novo review of\\n\\ncontinuating and divisional applications, but also of the\\ncorrectness of the examiner s issuance of restriction requirements and the examiner\\nacceptance of the applicantl s response to restriction requirements. That is an inapt\\nenlargement of precedent , indeed the case on which the majority relies Geneva\\nPharmaceuticals, Inc. v. GlaxoSmithKline. PLC , 349 F. 3d 1373 (Fed. Cir. 2003), states\\nthat \" requirements for restriction under 35 U. C. 121 are discretionary with the\\nCommissioner. \" 19 at 1378 quoting MPEP \\' 803. 01. The Manual of Patent Examining\\nProcedure abjures the examiners to exercise care in making restriction requirements,\\nid\" but neither the MPEP nor any judicial decision removes the discretion of the\\nnot only the lineage of\\n\\nDirector, formerly termed the Commissioner , nor carves out an exception for restriction\\nrequirements into APA review of discretionary actions.\\n\\n03- 1077\\n\\n\\x0cthe patent on the basis of an asserted flaw in a discretionary procedure, here proposed\\n\\nafter sixteen years. That these restriction requirements were varied ahd somewhat\\ninconsistent cannot now penalize the patentee , who complied with them and whose\\n\\ncompliance was accepted by all of the examiners involved\\n\\nSee\\n\\nin the examination.\\n\\nNorthern Telecom. Inc. v. Datapoint CorP. , 908 F. 2d 931, 938 (Fed. Cir. 1990) (\" rA)ny\\n121) does not increase the\\n\\ndoubt as to whether the examiner lapsed in his duty (under\\n\\nburden on the applicant. \"\\n\\nThe sequence of restriction requirements was presented to the district court , who\\n\\ndecided the question. It cannot be correct that when the examiner found no flaw in this\\nnon-substantive non- appealable procedure, the\\n\\ncourts can later conduct a de novo\\n\\nsearch for some tenuous lapse, and invalidate any patent for which we disagree with\\n\\nthe agency\\n\\ns discretionary decision. In\\n\\nCorp. , 318 U. S.\\n\\nSecurities & ExchanQe Commission v. Chenerv\\n\\n80 (1943), the Court discussed such discretionary\\n\\nadministrative\\n\\nauthority:\\n\\nIf the action rests upon an administrative determination -- an exercise of\\njudgment in an area which Congress has entrusted to the agency -- of\\ncourse it must not be set aside because the reviewing court might have\\nmade a different determination were it empowered to do so. But if the\\naction is based upon a determination of law as to which the reviewing\\nauthority of the courts does come into play, an order may not stand if the\\nagency has misconceived the law.\\n1! at 94.\\n\\nCompliance with a restriction requirement is an \"exercise of judgment, id. , and is\\nentrusted to the\\n\\nDirector. Each examiner in the case before us determined that the\\n\\napplicant had complied with the requirement that was imposed.\\n\\n03- 1077\\n\\nThe question of\\n\\n\\x0crestriction, its correctness and its compliance, cannot now be collaterally attacked as\\ngrounds of patent invalidity. The district court\\' s decision should be affrmed.\\n\\n03- 1077\\n\\n\\x0cAttachment Number 5\\n\\nREDACTED\\n\\n\\x0cFITZPATRICK. CELLA.\\n\\nVED\\n\\nHAER &\\n\\n30 ROCKEFBLLER PLA\\nNBW YORK. NY 1 0 112-o38oaOG APR -6 AM 10:\\n\\n212-218-2100\\n\\nJIACSIMILE (212) 218-ZC!OO\\n\\nWASHINGTON OFFICE\\n1900 II MRet. H.\\nWAIHltiOTON, O. C. 20011\\n\\nWW. FITZPATftICKCELLA. COM\\n\\nUS COURT OF AP\\nFEOE RA L\\n\\nR.Ui.. OFFICE\\n\\n.cC.;r\\nMI! CAUFDIIIA 82818-71:10\\nNTEIt DRIVe, SUITE UIOO\\n\\nCOSTA\\n\\n(202) &30-1010\\n\"\"\"SIMILe ( 2) Bao-,O.,.,\\n\\n(714)\\n\\nROBERT L 8AECHTOLO\\n\\n..ACINIUI (7\\'41\\n\\nDIREC DIA C2\\'21211WU!13\\n\\nE-AIL\\n\\nApril 8 , 2004\\n\\nVI BA\\n\\nDELIVRY\\n\\nThe Honorable Jan Horably\\nClerk of the Cour\\nu.s. Cour of Appea for the Federa Circuit\\n717 Madson Pl., N. W.\\n\\nRoom 401\\nWashington, D. C. 20439\\nRe:\\n\\nBristol-Myers Sqwob Company, et a1.\\nv. Phaachemie B.\\nAppea No. 03- 1077\\n\\nDea Mr. Hambly:\\n\\nBecause there is a pending Motion For Reheag\\n\\nEn Ban\\n\\nin the above\\n\\nappeal I am Wrtig on behaf of all paries to inform the Cour tht the pares have an\\nagreement in priciple for reolving the litigation. The pares will submit a Stipulon\\n\\ndiming the case ealy next week for the Cour\\' s approval.\\n\\nResectfly submitted ,\\n\\n;tr\\nRober L. Baechtold\\n\\ncc:\\n\\nDavid T. Pritik ,\\n\\nEsq.\\n\\nFracis C. Lynch, Esq.\\n\\nAMagm\\nDC3.tIN 162717,,1\\n\\n8700\\n\\n&423\\n\\n\\x0c'","created_timestamp":"April 14, 2003","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/commission-advisory-opinion-addressing-proposed-agreement-between-bristol-myers-squibb-company-and.\/040412requestadvisoryopinionpdf.pdf"}
{"text":"b'CRAVATH\\n\\nSWAINE & MOORE LLP\\nWORLDWIDE PLAZ\\n\\nGEORGE ... GILLEPIE , m\\nTHOMAS R. BROME\\n\\nROBERT D. ,JOFFE\\nALLN FINKELSON\\n\\nRONA S. ROLF\\n\\nPAUL C. SAUNDERS\\nDOUGLA D. BROADATER\\nALN C. STEPHENSON\\n\\nFRANCIS P. BARON\\nRICHAD W. CLA\\n\\nWILLM P. ROGERS, .JR.\\n,JAMES D. COOPER\\n\\nFACSIMILE: (212) 474- 3700\\n\\nPETER S. WILSON\\n\\nJAMES C. VARDEL., m\\n\\nROBERT H. BAON\\n\\nB. ROBBINS KIESLING\\n\\nTELEPHONE: (212) 474- 1000\\n\\nMICHA S. GOLDMA\\nRICHAO\\n\\n. GREGORY M. SHAW\\n\\nMA R. SHULMA\\n\\nKRIS F. HEINZELM\\n\\nNEW YORK, NY 10019- 7475\\n\\nPETER T. BABUR\\nSADRA C. GOLDSTIN\\nPAUL MICHAKI\\nTHOMA G. RAFFERT\\n\\nSTPHEN L GORDON\\nDAIEL L MOSLE\\n\\nSTUART W. GOLD\\n.JOHN W.. WHITE\\n,JOHN E. BEERBOWER\\nEVAN R. CHESR\\nPATRICIA GEOGHEGA\\nD. COLLIER KIRKHAM\\n\\nMICHAL L. SCHLER\\n\\n825 EIGHTH AVENUE\\n\\nSTPHEN L BURNS\\nCITYPOINT\\n\\nKEVIN ,J. GREHA\\nW. CLAYTN ,JOHNSON\\nSTEPHEN S. MAEN\\n\\nONE ROPEMAER\\nLONDON EC2Y 9HR\\nTELEPHONE: 44-207-453. 1000\\n\\nC. ALN PARKER\\n\\nMA S. ROSENBERG\\nWILL B. BRANAN\\nLES R. STINBERG\\n\\nFACSI MILE: 44-.a07.860.11 so\\n\\nTIMOTHY G.\\n\\nPHIUP A. GELSON\\nRORY O. MILLON\\nNEIL P. WEREICH\\n\\nDAVID MERCO\\n\\nKATHERINE B. FORRES\\nKEITH R. HUMMEL\\nDAIEL SUFKIN\\n,JEFFEY A. SMITH\\n\\nWRITER\\' S DIRECT DIAL NUMBER\\n\\nRONA CAI\\n\\nMA I. GREENE\\n\\nSAIS ,JEBE.IA\\n\\n..ES C. WOOLERY\\nDAVID R. MARIOTT\\n\\nMICHAL A. PASN\\nANDRE ,J. PITT\\nMICHA T. REYOLDS\\nANTONY L RYAN\\nGEORGE E. ZOBITZ\\n\\nGEORGE A. STPHANAS\\n\\nROBERT I. TOWNSEND, m\\n\\nWlLU ... WHEL m\\nSCOTT A. BAHAY\\n\\nSUSA WEER\\n\\nROGER D. TURNER\\n\\nELIBET L GRAYER\\n,JUUE A. NORTH\\n\\n.JUUE T. SPELLMAN\\n\\nPHIUP ,J. BOECKMA ,\\n\\nSPECIA COUNSEL\\n\\nSAUEL C. BUTLR\\nTHOMA D. BAR\\n\\nROGER G. BROOKS\\n\\nWlLU v. FOGO\\n\\nROWAN D. WILSON\\n\\n(212) 474- 1564\\n\\n..OHN T. GAFNEY\\n\\nFAI,J. SAED\\nRICHA ,J. STARK\\n\\nTHOMA E. DUNN\\n\\nOF COUNSEL\\n\\nROBERT ROSENMA\\n\\nCHRISTNE BESHA\\n\\nCONFIDENT TRATMNT REQUESTED\\n\\nApril 27, 2004\\n\\nCarboplati\\nDear Mr. Clark:\\n\\nOn April 12 , 2004 , pursuant to Section XI , subsection (2) of the Decision\\nand Order dated April 14, 2003 and 16 C. R.\\n1.2 , Bristol-Myers Squibb Company\\n\\nBMS\") requested that the FTC issue an advisory opinon fiding that an agreement\\nwith Teva Phanaceuticals USA, Inc. (\" Teva ) did not raise issues under Section 5 of the\\nFederal Trade Commssion Act. BMS submits the enclosed documents to aid the FTC\\'\\nevaluation of ths request:\\n\\nDistrbution and Supply Agreement Between BMS and Teva and\\nattached Schedules (April 26 , 2004) (\"Distrbution and Supply\\nAgreement\"\\nSettement Agreement between BMS , Pharachemie RV. , and\\nResearch Corporations Technologies, Inc. and attched Exhbit\\n(April 26, 2004) (\" Settlement Agreement\"); and\\nStipulation of the Pares to Dismiss Appeal and Proposed Order,\\n\\nBristol-Myers Squibb Company and Research Corporation\\nTechnologies. Inc. v. Pharachemie B. V.. Appeal No. 03- 1077\\n(April 27 , 2004).\\n\\nThe Distrbution and Supply Agreement is the defmitive agreement\\ncontemplated by the agreement between BMS and Teva, dated April 8 , 2004 , provided as\\n\\nCONFIDENTIA\\n\\n\\x0cpar of our intial submission. The Settement Agreement resolves the ANA patent\\nlitigation concerng the drg carboplati and U. s. Patent No. 4 657,927. The Stipulation\\nof the Pares to Disss Appea and Proposed Order was fied with the Cour of Appeas\\nfor the Feder Circuit ealier today.\\n\\nrespectfy\\n\\nConfdential treatment of ths letter and the\\n57b-2(c)\\nrequested\\nto 15 U.\\n\\npurt\\n\\nA.\\n\\nenclosed. material\\n\\nand 16 C.\\n\\nR.\\n\\nis\\n\\n10(a)(2) and\\n\\n(e).\\n\\nThan you in advance for your consideration and assistce. If you have\\nany questions ,\\n\\npleae do not hesitate to call me at the number above.\\n\\nRichard J. Stak\\nDonald Clark , Secreta\\n\\nFederal Trade Commssion\\nth Street and\\n\\nPennylvana Avenue, N.\\n\\nWashigton, DC 20580\\nBY FEDERA EXPRESS\\nCopy to:\\n\\nAne Schenof, Esq.\\nBureau of Competition\\nFedera Trade Commssion\\n\\n601 New Jersey Avenue, N.\\nWashigton, DC 20580\\n\\nBY FEDERA EXPRESS\\n\\nCONFIENTI\\n\\n\\x0cAttachment Number\\n\\nREDACTED\\n\\n\\x0cSETTMENT AGRNT\\n\\nTh Setement Agent an Relea (\"Setemt Agent\" date\\neffecve as of Apr 26, 2004, is\\n\\nand\\n\\nen in by an amng Reseah Corporation Technologies,\\nPlati\"), an\\n\\nInc. (\"RCI an Brl-Myer Sqb Company (\\' \\'BMS\\' \\') (collectively, \"\\n\\nphahee B.V. (\"Pbaheme\" or \"Defet\\'\\').\\n\\nWites\\nWHS, Phaachee fied an Abbrvite New Dr Applition\\n(\" ANA\"), ANA No. 76-162, for apval to maet generc powde for injection prots\\n\\ncontag capla\\n927 pate\\')\\n\\nwith a\\n\\npah IV cecation tht U.\\n\\nwa invald, unenroble or not\\n\\nS.\\n\\nPat No. 4 657 927 (\\'\\n\\nined\\n\\nWHS, Ref is the assignee of the \\' 927 pate and BMS is\\nlicen of the \\' 927\\n\\nth exclusive\\n\\npatet;\\n\\nWHAS, RCT an BMS fied sut in th Dict of New Jerey, Civi Action\\nNo.\\n\\n01-C-\\n\\nthe \\' 927\\n\\n37S1\\n\\n(M,\\n\\nuner\\n\\n3S\\n\\nC.\\n\\n271(e)(2) agt Phacheme for ingement\\n\\nof\\n\\npat;\\nWHAS, Phaheme fied a secnd ANA, ANA No. 76-292, seeki\\n\\npreed soluton prouc conta capIa with a pah\\ncecaton tht the \\' 927 pate wa invald, unrceale or not inged\\nWH, BMS an Ref fied a inement action in th Dict\\napprval to maet\\n\\nse\\n\\nNew Jery,\\n\\nCiv Acton No. 02-C- 1270 (M, ba\\n\\non ANA 76-292;\\n\\nWHS, a Joint Stiulon an Or coDSlidati the two cas wa enter\\n(the conslida ca refer to herin as \\' \\'te\\nby the Dict Cour\\non Apri 22, 2002\\n\\nLitigaon\\n\\n\\x0cWH, Phmeme\\n-PJdgent tht th \\' 927\\n\\ndelary\\n\\npatig ba\\n\\non th\\n\\naner an counlaed in th Litigaon for\\n\\npa was\\n\\ninvad on\\n\\ncla of U. S. Patet No. 4 140,\\n\\n707 (\"te \\' 707\\n\\npror\\n\\nWHS,\\n\\nhmchemi e fied a motion forpa\\n\\npr ru th the bar of the th\\nthe \\' 707 pate\\n\\nse\\n\\nof obviousty\\n\\nthe grun\\n\\ndouble\\n\\npatef\\') in ligh of\\n\\nS1 juen se\\n\\nof35 U. C. fi 121 di\\n\\nnot\\n\\naply to prven us of\\n\\nin an obviousty double patti chaene to th \\' 927 pat and\\n\\npla fied a cross-mtion for\\n\\nF.dBJeDt on th\\n\\nsu\\n\\nWHRES, on Juy 29, 2002, the Dict\\nBMS and RCIs motion for\\n\\nfi 121 issue;\\n\\nCour\\n\\nis\\n\\nsu jud an hold tht\\n\\nfi 121\\n\\nwrtt opon\\n\\nba use of the \\' 707\\n\\npatet as th bais for an obvouses double panti invaldi chaen;\\n\\nWH, Phae amen its aner to adt mfgement of at leat\\n\\ncl\\n\\nif it were vad, an to waive the defen of inuitale cond an\\nin ord to\\nits right to appea\\nal other invaty defen it ha prousy\\none\\n\\nfrm a\\n\\nof the \\' 927 pat,\\n\\nfi judgent an the\\n\\nas\\n\\nDict Cour\\n\\nesli\\n\\nente fi\\n\\njuen on Octobe 28, 2002, in\\n\\nfavor of P1aintiff\\n\\nWHRES, on Octbe 28 2002, the Disct Co ente FiD Judent in\\nfavor ofBMS an RCI\\n\\nine at\\n\\nlea one\\n\\nth th \\' 927 pa wa\\n\\ncla of th \\' 927 pate\\n\\nmaeti any prdut put\\n\\nnot invald,\\n\\nan tht Plwhee\\n\\nand an injuntion prJn\"bitig\\n\\nPhahee from\\n\\nto ANAs 76-162 and 76-292 before th expirn of the \\' 927\\n\\npate an any other exclusty grte by the Foo\\n\\nan Dm Admtion\\n\\n(\"FA\"\\n\\nPhaheme fied an ap in the Unite\\nWH, on Novem\\nfi jndeent (\"te\\nof Ap for th Fed Cit ftm\\n26, 2002,\\n\\nSta Cowt\\n\\nwould\\n\\nth Distrt Cowt\\'\\n\\n\\x0cApp ised an opiDon vati tht\\nudgen an redig th Ligatin to th Dict Cour for fter\\n\\nAp\") and on Mah 17,\\n\\npr;is\\n\\n200, th Cour of\\n\\nex\\n\\nWHRE, Phacheme moved on Mah 19, 200, to\\nised th mae, th Plati\\nmate and, bere th Cour of\\n\\nAp\\n\\n200, a petion for rehea\\n\\nen bae\\n\\n\\'t Peton\\n\\nfor Reea\"\\n\\nWHS, on Apri 6, 200, the Cour of Ap\\n\\nmotion to\\n\\nex\\n\\nfied on\\n\\nof the\\n\\nMa 29,\\n\\nPhi\\n\\ndeed\\n\\nissuce of th mate;\\n\\nWH, on April 9, 200, th paes submtt a let to the Cour of App\\n\\ninorm the Cour of App tht they ba reed an agent in prcile to sette\\nmatt\\n\\nWH, on Ap 21 , 200, th Cour of App dened th Petition for\\nReh;\\nWHAS, Phahee acowledge th BMS is entitled to a perod\\npetrc excluivity with respt to parlatie if an when grte by th FDA purua to 21\\nC. i\\n\\n3SSa\\n\\nWHAS, the\\n\\nPla an Defe\\n\\ndesir to avoid\\n\\nfu\\n\\nexpen and\\n\\nma an ises in contvery betwee them aU without an adon by or on\\nto any other pa;\\n1he par of any pa of any lity of any\\nrelve aU\\n\\nnatu whatsever\\n\\nNOW,\\n\\nTHORE, in consden of the prmies\\n\\nan\\n\\ncoven cotaed\\n\\nherin an for oth goo an valuale consdeoD, th rept of which is heeby\\n\\nacwleded it is herby\\nfollows:\\n\\nag\\n\\nby an among\\n\\nth paes to th\\n\\nSetem\\n\\nAgt\\n\\n\\x0cI)mnAsa ofLiga\\n\\neten Ag\\n\\nCi\\n\\nsoon as prtile fonowi the execon of\\n\\nthe paes wi fie in the\\n\\nm!mRS BD\\n\\nstultin of\\n\\nAs\\n\\nUni Sta Comt of App for th Fed\\n\\nprse ord, in the form athed as ExI\"bit A.\\nprmptl any\\npaes ag\\n\\nspif th ea pa sb be\\nadona pa ne or apro to effec th\\nown cost. The\\n\\ndi\\n\\nRelee of an Coven not to Sue plAintiff ,\\n\\nrelea licees, coven, agts anor oth\\n\\n(al of the foreoing\\n\\nIn\\n\\ngoo and\\n\\nret of which is hey acknowleded Phaheme, in\\n\\nsurs assign offce,\\n\\nto fie\\n\\nof the\\n\\nLitin.\\n\\nconsdeon of mutu\\n\\nvale\\n\\nconsidetion, the\\n\\nadini91tors,\\n\\nodg its\\n\\ndirs, emloyee trte, pats, subsidies\\n\\nan aftes\\n\\nbe refem to in th pagrh as \"Pbahee Relears rele.\\nsu andlor\\n\\nprs\\n\\nact an forever dihae. and covent not to bri\\n\\nany action,\\n\\nag\\n\\nsuccrs, asgn, Offce, ditors\\n\\nBMS and RCT,\\n\\nemloyee atrn,\\nin\\nof\\n\\nth parh\\n\\ninlu thir adrs\\n\\ntr,\\n\\nAffli\\n\\n(al of\\n\\nth foreing refeIT to\\n\\nas \"BMS an RCT Relea fr an for al debts\\n\\ndeds, actions, caes\\n\\npats sudies an\\n\\nac suts acun covem cOtm, agents tort da\\n\\ncla defen, offts\\n\\njudgments ilemsmdR and liilties\\n\\nth Litigation andlor\\n\\nor defen of th Litiaton, and\/or other\\n\\nftduent or tortous\\n\\nact by the\\n\\npec excluvity wi re\\n\\nor\\n\\nunecte ac\\n\\nwhh are out of th proseon\\n\\naleg anticomptive, un, wr\\n\\nre\\n\\nBMS an RCT\\n\\nRelea\\n\\nto PamJa\\n\\norovided however.\\n\\nhein is inde to or sha relea th BMS an ReI\\n\\nan al\\n\\nwhatsver, of evfS nae and\\n\\nnatu both at law and in eqty, knwn or UDwn sute\\n\\nunCC whch have be asse in\\n\\nan any\\n\\nto the \\' 927\\n\\ndectie,\\n\\npa anor an\\n\\nth noth contaed\\n\\nRelea from any an\\n\\nan obligaons\\n\\n\\x0cset fort\\n\\nin\\n\\ntI Agent an\\n\\nP\"AfSlQetica\\n\\nth Distribution\\n\\nUSA. In. (th \"Dis1ribution\\n\\nRe of an Coven\\n\\nAgr\\n\\nbetee BMS an Teva\\n\\nan Suly Agrt\"\\n\\nnot to Sue\\n\\nDet.\\n\\nIn consden\\n\\nofmu\\n\\ncoven agen anor other goo and valle codertion, th\\nof which is hery acknowleed BMS an Ref, inlud thei retive\\n\\nreeaes\\n\\nre\\n\\nli\\n\\nan Suply\\n\\nadrs\\nan afte\\n\\nsusors asgn\\n(aU of the\\n\\noffcer ditors.\\n\\nemloyee,\\n\\ntt pa\\n\\nforeiD bei refer to m th parh\\n\\nRelears ) relea, act\\n\\nan foreer dischae, an\\n\\ncovenat\\n\\nsusidies\\n\\nas \"BMS and RCT\\n\\nnot to brig\\n\\nany acton, sut\\n\\nag Phabee, inlu it adtors susors asgn,\\noffce. ditors emloyee. attrneys, tr, parts suid and afte (all of the\\n\\nanor pr\\n\\nforegoing refem to in\\n\\ndemds. actions\\n\\nth\\n\\npa\\n\\nRelea ftm an for al debts\\n\\nca of action suts 8Cun1s coven cont\\n\\ndaes an any an al cla,\\nwhaever, of ever na an\\nor\\n\\nas \"Phaheme\\n\\nunte ac\\n\\nor\\n\\nagen, tort,\\n\\ndefe, offet, judents demds an\\n\\nliilties\\n\\nna. both at law an in eqty, knwn or unwn sute\\nwhch have\\n\\nbe asse in the Lition,\\n\\nanor which\\n\\nar out of th proseuton or defene of th Ligaon, anor whch ar bas on any\\ninement or aleged inem of any pate own lice or assgn by or to the BMS\\nanor RCT Relears for\\n\\nanor\\n\\nD1,\\n\\nusg, purha offer for sa, sell\\n\\ndibu any phaca pr\\n\\nprvided however.\\n\\ncota\\n\\nth notl contaed herm is\\n\\ncapla\\nto or sb\\n\\nin\\n\\nas it active\\n\\nimortg\\n\\ninent,\\n\\nrelea the\\n\\nPbaeme Relea frm any an al oblioDS se fort m th Agren an the\\nDistribution an Suply\\n\\nAgrt. BMS\\n\\nan Ref do not waive any leg chaenge in\\n\\nthe\\n\\n\\x0ceven th\\nOcbe\\n\\nFDA grts\\n\\nIS,\\n\\nei\\n\\nfi apval of\\n\\nor both of ANAs 76-162 an 76-292\\n\\nbefore\\n\\n20.\\n\\nPhahee Releaors,\\nas defied in pah 2, ag th thy sh not intu, enure, surt spnsor or\\naga the FDA or any oth entity to obta\\npacipat in an leg acn diy or\\nCoven Not to Cbem Pedtrc Excluvitv. Th\\n\\nin\\n\\nfi apova of eith or bothANA 76-162 an\\n\\nexclu gr\\n\\nto BMS by th FDA\\n\\npurt to 21 U.\\n\\nNo Admi!Con ofT .iahilit.\\n\\ncons an adon,\\n\\nra\\n\\nconcen\\n\\n76-292\\n\\nbefore th\\nC.\\n\\neximon of any\\n\\n355s.\\n\\nTh Setement Agent do not cont\\n\\npar conc the merts of\\nor Pettion for Rehea. Th Setemt Agren\\n\\nor\\n\\nagen\\n\\nby any\\n\\nLition, Ap\\nsh not be consed as constug or conta any suh adion,\\n\\nises\\n\\nin the\\n\\nagent.\\n\\nReoons. Ea of the pares herto\\nwam (i) tht it fuy unta\\n\\nitsTigh to\\n\\ndis\\n\\nre,\\n\\nany and al\\n\\nconcion\\n\\nacowledes and\\n\\nasts of th\\n\\nAgrt with leg counl of its own chsi; an to th extt, if any,\\n(ii) th it ha cafuy re an fuy\\nde, it ha avaed\\n\\nSettement\\n\\nth any\\n\\nits of th righ\\n\\nthe provions of th Settement\\n\\nAgr (il) 6J it volunta ente\\n\\nun\\n\\nal of\\n\\ninto ths Settemen\\n\\nAgrent; (iv) tbt it ha th caity to en into ths Setemen Agrment, an (v) tht its\\nsignry he ha th aurity to bin it to the obligaons and beefi of th Setement\\n\\nAgrent.\\nNo Pror\\n\\nRetaon Eah of th paes he rerets acknowledes\\n\\nwamts th in execti\\n\\nth Setemt\\n\\nAgr\\n- 6-\\n\\nit does not rely an ha\\n\\nnot relied\\n\\nupn any\\n\\n\\x0cretan\\n\\nor statecmt not se for\\n\\noftbs Setem\\n\\nre\\n\\nto the sujec\\n\\nAgen or othe.\\n\\nEnti\\n\\nrq\\n\\nAme ThSeemen Agt\\n\\nre\\n\\nthe paes with\\n\\nher with\\n\\nto th\\n\\nma, ba\\nth en\\n\\nsujec ma herf: an al pror negotiOD,\\n\\nor effect\\n\\nagt\\n\\nuners\\n\\naD agcmts ar incorpra he Th Settem Agent may not be modied,\\nchged amened sulemente or\\n\\nre\\n\\nexcet puuat to\\n\\nwrtt inent\\n\\nsigned by\\n\\naga whom th enorcnt of the modcation, chae, ament,\\n\\nthe par\\n\\nsulementation or reison is soug\\n\\nRearv Reew. Eah pa, with te (10) days of th executon oftb\\nSettemen Agrt, sb comply with th reents of Title XI, Subtitle B of the Acc\\nto Afontle\\n\\nPhaca\\n\\nPu. L. 108-173) (the \"\\n\\nTrae Common\\nBMS wi\\n\\n(the\\n\\nAct (th\\n\\ntion Dm Imvement\\n\\nMedca\\n\\nAct\", by ti a copy oftb Setement\\n\\'FCj\\n\\n\"FC\\n\\nAgent: (a) submion of\\n\\nOr in Fed\\n\\nopinon\\n\\nTmd Common Docket No. C-\\n\\nOr, (b) suon oftb Setemt Agent in conntin with\\n\\nre\\n\\nMyer Sqb\\n\\nSetemen\\n\\nAgent to the FrC in coection with th rees for advity\\n\\nby the Apri 14, 2003 Deison an\\n\\nnoticaon\\n\\nCo.,\\n\\nby the May 14, 2003\\n\\nOr an Stiulte Injuntion\\n\\nNo. 1:02-C-OI080 (EGS) (D.\\n\\nAgren in coon with the noticaon\\nOrer an Stipulte Injuon\\n(S.D.\\n\\nof Justice (\\' \\'DJ\\'\\'\\n\\nma the fonowig suons an notice as son as prticale an jn any event no\\n\\nth Setement\\n\\n4076 (th\\n\\nof 2003,\\n\\nAgrent with the Fed\\n\\nand the AntIt Divion of the Dearen\\n\\nlat th te (10) days fonowi the execon of th\\n\\nre\\n\\nAct\\n\\njn\\n\\nre\\n\\n), an (c)\\nby th\\n\\nin\\n\\nsuon\\n\\nOhio v.\\n\\nBrl-\\n\\noftb Settement\\n\\nNovem 14, 2003 Revi\\n\\nIn re Busirone Antitr Ligaton No. 01 CV 11401\\n\\n) (th paes to whom notice is prvide\\n\\n7-\\n\\nuner the thes la two\\n\\noId ar refer\\n\\n\\x0che as\\n\\nth \"Attrn\\n\\nI\\'le\\n\\nGeer\\' \\'). Th paes sb us commeria\\n\\ncoordte su suODS an to\\n\\nre\\n\\nprmptly to any\\n\\nre\\n\\nefrt to\\n\\nfor adtion\\n\\ninrmtion\\n\\nma by the FTC, the OOJ or th Attmeys Geer If th FI, OOJ or Attmeys Geer\\nobject to th Setement Agren th paes sh us al commy rele effort to\\nsuch objecon prvide th th sh be no mate ch to the right;\\n\\nad\\n\\nobligaon of th paes un\\nChce of Law.\\n\\n10.\\n\\nconstr in\\n\\nTh Setement Agren sh be govered by, suject to, and\\n\\nacrd with the laws of\\n\\nconfct of law\\n11.\\n\\ncoun\\n12.\\n\\no(\\n\\nNew York wiout\\n\\nre\\n\\nto its\\n\\niner\\n\\nl\".rmte Th Setem Agt may be exec in one or\\nea ofwbi sh be conside an origi intrent, but al of whch togeter\\nan th sa\\n\\nagen\\n\\nLe Fee an Cost. Ea pa\\n\\nconnection with th\\n13.\\n\\nth stte of\\n\\nprles\\n\\nsha constitu one\\n\\nth befi\\n\\nth Settemen Agren-\\n\\nLitigaon,\\n\\nBmdinp Effect\\n\\nsh be\\n\\nits own leg\\n\\nfee and costs in\\n\\nAgrt.\\nTh Setement Agrent sb be biD up and in\\n\\nAp Peton for Rehea an\\n\\nth paes heto an thei sucm\\n\\nth Setement\\n\\nan asgn, regmes of the outcme of\\n\\nthe review by the Attrnys Gener intite by BMS on Apri 14, 200, and th\\n\\nadry opinon 1im th FfC ma by BMS on Apr\\nand Suply Agren\\n\\n- 8-\\n\\n12, 200, with\\n\\nre\\n\\nfor an\\n\\nreect to the Distribution\\n\\n\\x0cIN\\nof the\\n\\nda fi\\n\\nWIS WHF,\\n\\nthe paes have\\n\\nexec th Settemt Agren\\n\\nabve\\n\\nDate: Ap-J 200\\n\\nResh Corpraon\\n\\nTeclogies, Inc.\\n\\nBy:\\n\\nDate Apri -,\\n\\n200\\n\\nBril-Myer Squibb\\nBy\\'\\n\\nDa Apri-, 200\\n\\nPhe B.\\nBy:\\n\\nCoy\\n\\n\\x0c..t\\n\\nF.r\\n\\nh. CorlltiOl\\n\\n+sz ,... 002&\\n\\nInq\\n\\nTUMDIOfII\\n\\nWS. t1pahm\\nI ofth da fi\\n\\nabve\\n\\nDate Ap..\\n\\n1h\\n\\nwaum\\n\\n20\\n\\nTec1oaes In.\\n\\nb Co\\n\\nBy:\\n\\n, Da Ap\\n\\ni Da Ap\\n\\nT-6 P- DOflDtj F-14D\\n\\nBriol.Mye\\n\\nSq\\n\\nPiah\\n\\nBY.\\n\\n\\x0cIN\\nof\\n\\nti da fi\\n\\nWIS WHF,\\n\\nth\\n\\npa have ex\\n\\nth\\n\\nScCJ Agrt\\n\\nab\\n\\nDa Ap-- 200\\n\\nRe Coraon Tecologi\\n\\nDa Apr JR200\\n\\nBril-Mye\\n\\nDa Apr-- 200\\n\\nPhhee B.\\nBy:\\n\\n--9 -\\n\\nSqb\\n\\nComp\\n\\nInc.\\n\\n\\x0cIN Wls..\\n:oldl dI..f\\n\\nDate:\\n\\nabve\\n\\n1-,\\n\\n.p Ap..\\n\\n118\\n\\npa have-e\\n\\nth8.\\n\\nwm.\\n\\nRe \"\\'\\'\\'_ \\';-.-1\"\\'\\'\"n\\'\\n\\nBriJ-M1U sqm\\'t\\n\\nIn\\n\\nCoy\\n\\nBy -\\n\\nNi2b20\\n:. I :\\n\\n.r\\n\\ni:::\\n.I\\n\\n,L\\n\\nr \"\\n.1:-\\n\\ni i..-:::.\\n\\n-9-\\n\\n:t.\\n\\n\\x0cEXIIT A\\n\\nUND STATES COURT OF APPEALS\\nFOR THE FEERA\\n\\nCICUI\\n\\nNo. 03- 1077\\n\\nBRISTOL-MYRS SQUIB COMPAN,\\n\\nPlaiti-Appellee,\\nand\\n\\nRESEACH CORPORATION TECHNOLOGIES, INC.,\\nPlaitiff-Appellee,\\n\\nPHACHEMI B.V.,\\nDefendat-Appellant.\\nAppeal from the United States Distct Cour for the Distrct of New Jersey\\nin Case No. 01-CV- 375I, Judge Mar L. Cooper\\n\\nSTIULTION OF THE PARTIS TO DISMISS APPEA\\nThe pares, havig seted and\\n\\nresolved all issues in the case, consent to\\n\\ndismsal of the appea and the underlyig acton.\\nThe pares\\n\\nagree\\n\\nDated: Apri -,\\n\\n2004.\\n\\nto bear their own costs.\\n\\n\\x0cBy:\\n\\nDavid T.\\n\\nPriti\\n\\nConstie L. Trela, Jr.\\n\\nLisa A. Schneider\\nMarc A. Cavan\\nSIDLEY AUSTI BROWN & WOOD LLP\\n10 South Deaorn Strt\\nChicago, IL 60603\\n(312) 853-7000\\n(312) 853-7036 (fax)\\n\\nCounel for Research\\n\\nCOlporation\\n\\nTechnologies, Inc.\\n\\nBy:\\n\\nRober L. Baechtold\\nFitzatrck, Cella, Harer & Scinto\\n30 Rockefeller\\n\\nPlaz\\n\\nNew York, New York 10112- 3801\\n(212) 218-2100\\n(212) 218-2200 (fax)\\n\\nCounel for Britol-Myers Sqwbb Company\\n\\nBy:\\nFrancis C. Lynch\\n\\nLaure S. Gil\\nPALME & DODGE LLP\\n50 West State Strt, Suite 1400\\n111 Huntigton Avenue\\nO. Box 1298\\nBoston, MA 02199- 7613\\nCounsel for Phaacheme, B.\\n\\n\\x0cNOTE: Puuat to Fed. Cir. R. 47. 6, th order\\nis not citale as precedent. It is a public order.\\n\\nUND STATE COURT OF APPEAS\\nFOR TH\\n\\nFEER CIRCUI\\n03- 1077 .\\n\\nBRISTOL-MYRS SQUIB COMPAN,\\n\\nPlaiti-Appellee,\\nand\\nRESEARCH CORPORATION TECHNOLOGIES, INC.\\n\\nPlati-Appellee,\\nPHACHEMI B.V.,\\nDefendat-Appellant.\\nAppea from the United States Distct Cour for the Distrct of New Jerey\\nin Case No. 01- CV- 3751, Judge Ma L. Cooper\\n\\n(pROPOSED) ORDER\\n\\nPut\\n\\nto the Stipulation of the pares dated Apri -, 2004 and by\\n\\nFederl Rule of Appellate Procedure 42(b),\\n\\nIt is\\n\\nORDERD th:\\n\\n\\x0cAppeal dismssed Ths cae is remaded to the\\n\\nintrctions to\\n\\ndis the cae.\\n\\nNo costs.\\n\\nFor the Cour\\n\\nDate:\\n\\nditrct cour with\\n\\n\\x0cUND STATES COURT OF APPEAL\\nFOR TH FEDERA CIRCUT\\nNo. 03- 1077\\n\\nBRISTOL-MYRS SQUIB COMPAN\\n\\nPlaitiff-Appellee\\nand\\n\\nv\") :;\\nrr\" ,\\n\\nRESEACH CORPORATION TECHNOLOGIES, INC. ))\\n\\nr- 0 N\\n\\nPlaintiff-ApJi\\n\\nU -\\n\\nm r;\\n-I:l\\nr- N\\n\\nrn.\\n\\nPHACHE B.\\nDefendant-Appellant.\\n\\nAppeal ftom the United States Ditrct Cour for the Distrct of New Jersey\\nin Case No. Ol-CV - 3751 , Judge Mar L. Cooper\\n\\nSTIPULTION OF TH PARTIES TO DISMISS APPEAL\\nThe pares, having setted and resolved all issues in the case , consent to\\ndismissal of the appeal and the l.derlyig action.\\nThe pares agree. to bear\\n\\nthei own cost.\\n\\n.I\\n\\nDated: ApriI27 2004.\\n\\n\\x0c.2\\n\\nBy:\\n\\nDavid T.\\n\\nh:hJ.j\\n\\nPrti\\n\\nConstatie L. Trela, Jr.\\nLisa A. Schneider\\nMarc A. Cavan\\nSIDLEY AUSTI BROWN & WOOD LLP\\n10 South Dearorn Street\\nChicago, UL 60603\\n(312) 853-7000\\n\\n(312) 853-7036 (fax)\\n\\nCounel for Reseach Corporation\\nTechnologies, Inc.\\n\\nBy:\\na.\"k,\\n\\nRobert L. Baechtold\\n\\nFitzatrck, Cella, Harr\\n\\n& Scinto\\n\\n30 Rockefeller Plaza\\n\\nNew York, New York 10112- 3801\\n(212) 218-2100\\n(212) 218-2200 (fax)\\n\\nCounsel for Bristol-Myers Squibb Company\\n\\n;(r\\n\\nBy:\\n\\nFrancis C. Lynch\\nLaure S. Gill\\nPALMER & DODGE LLP\\n50 West State Street, Suite 1400\\n111 HlDtigton Avenue\\nO. Box 1298\\n\\nBoston, MA 02199-7613\\nCounsel for Phachemie , B.\\n\\n\/I#\\n\\n\\x0cNOTE: Pusuant to Fed. Cir R. 47. 6, ths order\\nis not citable as precedent. It is a public order.\\n\\nUND STATES COURT OF APPEALS\\nFOR TH FEDERA CICUIT\\n03- 1077\\n\\nBRISTOL-MYERS SQUffB COMPAN\\nPlaintiff-Appellee,\\nand\\nRESEARCH CORPORATION TECHNOLOGIES , INC.\\n\\nPlaintiff-Appellee\\n\\nPHACHEMIE B.\\nDefendat-Appellant.\\nAppeal ftom the United States Distrct Cour for the Distrct of New Jersey\\nin Case No. OI-CV- 3751 , Judge Mar L. Cooper\\n\\n(pROPOSED) ORDER\\n\\nPuuat to the Stipulation of the pares dated April 27, 2004 and by\\nFederal Rule of AppeIIate Procedure 42(b);\\n\\nIt is ORDERE that:\\n\\n\\x0cAppeal dismssed. Ths case is remaded to the distrct com with\\n\\nintrctions to dismiss the case.\\nNo costs.\\nFor the Court\\n\\nDate:\\n\\n\\x0cUNTE STATES COURT OF APPEALS\\nFOR TH FEDERA CIRCUIT\\nNo. 03- 1077\\n\\nBRISTOL-MYRS SQUIB COMPAN,\\n\\nPlaitiff-Appellee\\nand\\n\\nRESEARCH CORPORATION TECHNOLOGffS , INC.,\\n\\nPlaitiff-Appellee\\n\\nPHACHEMl B.\\nDefendat-Appellant.\\nAppeal from the United States Distrct Cour for the Distrct of New Jersey\\nin Case No. 01- CV-3751 , Judge Mar L. Cooper\\n\\nDECLARTION OF AUTHORI OF ANNE M. MAR\\n1, Ane M. Maher, hereby declare as follows:\\n\\nI am Parer of Fitzatrck, Cella, Harer & Scinto. I submt ths\\n\\ndeclaration of authority pursuat to Federa Circuit Rule 47.3(d) and 28 U.\\n1746.\\n\\nOn April 14 , 2004 , I was given actual authority to sign the enclosed\\nStipulation of the Pares to Dismiss Appeal on behal of Robert L. Baechtold, a\\n\\n\\x0cparer in the law\\n\\n:f\\n\\nof Fitzatrck, Cella,\\n\\nHarer & Scinto, the attorney of\\n\\nrecord for Bristol-Myers Squibb Company in the above-captioned action.\\n\\nOn April 14, 2004 was given actual authority to sign the enclosed\\nStipulation of the Pares to Dism Appeal on behal of David T. Prti, a\\n\\nparer of the law\\n\\nfi\\n\\nof Sidley,\\n\\nAusti, Brown & Wood LLP, the attorney of\\n\\nrecord for Reseach Corporation Technologies, Inc. in the above-captioned action.\\nOn Aprl 27 ,\\n\\n2004, I was given actual to sign the enclosed Stipulation\\n\\nof the Pares to Dismiss Appeal on behalf of Fracis Lynch, a\\n\\nparer in the law\\n\\nfirm ofPaImer & Dodge , LLP, the attorney of record for Pharachemie, B.\\nI hereby declare under penalty of perjur\\n\\ntht the\\n\\nforegoing is tne\\n\\ncorrect\\n\\nDated: April 27, 2004\\n\\nMAIN 42168v1\\n\\n)1.\\n\\nand\\n\\n\\x0ct .\\n\\nCERTIICATE OF SERVICE\\nI hereby cerfy that on ths\\n\\n16th day of April ,\\n\\n2004, two copies of the\\n\\nforegoing STIULATION OF TH PARTIS TO DIS:MS APPEAL and\\n(pROPOSED) ORDER were sered upo counel of record as follows:\\n\\nFrancis C. Lynch\\nLaure S. Gill\\nPALMER & DODGE LLP\\n111 HWltigton Avenue\\nBoston, MA 02199-7613\\nCounsel for Defendant-Appllant Pharchemie B.\\n\\nPrti\\n\\nDavid T.\\nSIDLEY AUSTIN BROWN & WOOD LLP\\n10 South Dearborn Street\\n\\nChicago , IL 60603\\n\\nCounsel for Research Corpration\\n\\nTechnologies ,\\n\\nInc.\\n\\nRobert L. Baechtold\\nFitza1rck, Cella, Harer & Scinto\\n30 Rockefeller\\n\\nPlaz\\n\\nNew York, New York 10112- 3801\\n\\nCounel for Britol-Myers Squibb Company\\nby deliver of said copies , properly addressed with shipping charges prepaid, to a\\ncommercial overght deliver serce with inctions to deliver said copies to\\nthe addresse the next business day.\\n\/1.\\n\\nMa,--\\n\\nOn behalf of Plaitiffs-Appellees\\n\\nCHI 2922154vl\\n\\n\\x0c'","created_timestamp":"April 27, 2004","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/commission-advisory-opinion-addressing-proposed-agreement-between-bristol-myers-squibb-company-and.\/040427advisoryc4076.pdf"}
{"text":"b'431UNITD STATES OF AMER\\n\\nFEDERA TRADE COMMSSION\\nWASHIGTON, D. C- 20580\\n\\nMay 12 , 2004\\n\\nT. Scott Giligan , Esqq.\\nStatman Rars Siegel & Eyrch , LLC\\n2900 Chemed Center\\n\\n255 East Fifth Street\\nCincinnati , OR 45202\\n\\nRe: Third Par Merchandise Issue\\nDear Scott:\\n\\nThan you for your letter of March 25 , 2004. I also was pleased with the meetings I had\\nwith NFA and the state associations in March , and hope that we wil continue to keep good\\nlines of communication open.\\n\\nYour letter requests an informal staff opinion on an issue related to delivery of caskets\\nthat consumers have purchased from third- pary sellers. You note that you have consistently\\nadvised funeral homes that they are not required. to sign receipt forms because the homes are not\\npar of the casket purchase contract. In addition , you note that the receipt forms frequently\\ncontain written representations that the delivered casket is the merchandise that was originally\\npurchased , is acceptable , and\/or was delivered without damage. You have advised funeral homes\\nthat they cannot attest to those conditions or representations because they are not a pary to the\\ncontract. You request an informal FTC staff opinion on whether the FTC\\' s Funeral Rule (\" Rule\\nwould prohibit a funeral home from refusing to sign a receipt acknowledging delivery of a casket\\na from a third-par casket seller.\\n\\nThe FTC staf has addressed this issue in the past , in opinions relating to practices that\\nmay violate the Rule s prohibition in Section 453. 4(b)(1) against conditioning the furnishing of\\nany funeral goods or services to a person aranging a funeral upon the purchase of any other\\n\\nfuneral good or service. Staff opinions in 1988 and again in 1997 make clear that this prohibition\\nincludes situations in which the funeral provider unreasonably burdens the consumer s choice to\\npurchase the casket elsewhere. Moreover , a staff opinion , dated March 10 , 1988 , is directly on\\npoint. In that opinion , Commission staff stated:\\nIn my view , a funeral provider may not unreasonably burden a\\nconsumer s choice to purchase an item such as a casket from a\\n\\nthird par\\n\\n.\\n\\n. , I believe that\\n\\nrefusal of the funeral I1rovider to sirm\\n\\nfor the merchandise. or acknowled!!e deliverv. al1l1ears\\n\\n\\x0ctantamount to refusal to accel1t deliverv and therefore may be in\\nviolaon of the Rule. (emphasis added) (A copy of the opinion is\\nenclosed..\\n\\nThose words reflect the FTC staff\\'s opinion in 1988 and they continue to reflect the current\\nthinking of the FTC staf charged with enforcing the Funeral Rule. Accordingly, I reaffirm the\\nstaf opinion that refusal to sign for merchandise or acknowledge delivery is tantamount to\\nrefusing to accept delivery and thus may violate the Funeral Rule s prohibition against tying, in\\nSection 453. 4(b)(l).\\n\\nI hope ths information is helpful to you. Please note that the views expressed in this\\nletter ar those of the FTC staff. They have not been reviewed, approved or adopted by the\\nCommssion, and they ar not binding on the Commssion or any individual Commssioner.\\nHowever, they reflect the opinions of the staff members who are charged with enforcement of the\\nFuneral Rule. If you have any questions , please feel free to contact me at (202) 326- 3115 (email\\ncdanielson (gftc. gov)\\n\\nSincerely,\\n\\nCarole 1. Danelson\\n\\nSenior Investigator and\\nFuneral Rule Coordinator\\nDivision of Marketing Practices\\n\\n\\x0cxx\\n\\nU \/I \/\\n\\n- \/1\\n\\n, 3\/9\\n\\nUNITED STATES OF AMERICA\\n\\nFEDERAL TRAE COMMISSION\\nWASHINGTON, D. C. 20580\\nBUREAU OF\\n\\nCONUMER PRTECT\\n\\nMarch 10, 1988\\n\\nPittsburgh, Pennsylvania 15236\\nDear Mr.\\n\\nI am writing in response to your request for a staff opinion\\nof December 1, 1987, and your follow-up letter of January 22,\\nsituation where a person\\n1988. Your question is twoarranging a funeral has elected to purchase a casket from a third\\nparty casket seller rather than from the funeral director who is\\narranging the funeral, (1) can the funeral director require that\\nperson or family to be present when the casket is delivered to\\nthe funeral home, even if they do not wish to be present: and (2)\\ncan the funeral director refuse to sign for the casket when it is\\ndelivered to the funeral home.\\n\\nfold: In a\\n\\nPlease be advised that the views expressed in this letter\\nare those of the FTC staff. They have not been reviewed,\\napproved or adopted by the Comm 5sion, and they are not binding\\nupon the Commission. However, they reflect the opinions of the\\nstaff members charged with enforcement of the Funeral Rule.\\nAs you know, under Section 453. 4(b)(1) of the Rule,\\nfuneral provider cannot condition the furnishing of any funeral\\ngoods or services to a person arranging a funeral upon the\\npurchase of any other funeral good or service (except as required\\nby law or otherwise permitted by the Rule). Under this section,\\nthe funeral provider cannot require the purchase of a casket from\\nthe funeral home as a condition of arranging a funeral for the\\nindividual or family. The FTC staff has taken the position that\\nfuneral providers can assess a casket handling fee to cover any\\nadded labor or liability costs incurred because a family chooses\\nto provide a casket purchased elsewhere.\\n\\nIn my view, a funeral provider may not unreasonably burden a\\n\\nconsumer s choice to purchase an item such as a casket from a\\nthird party. I believe that requiring a family to be present for\\ndelivery, when that family has expressly asserted they do not\\nwish to be present for delivery, is placing an unreasonable\\nburden upon the consumer \" s choice to purchase the casket\\nMoreover, I believe that refusal of the funeral\\nprovider to sign for the merchandise, or acknowledge delivery,\\n\\nelsewhere.\\n\\nBicentenn of the United States Constitution\\n11787- 1987)\\n\\n\\x0cPage 2\\n\\nappears tantamount to refusal to accept delivery and therefore\\nhe Rule.\\n\\nmay be in violation of\\n\\nIf, as you allege, there is concerted action among funeral\\nproviders in your area to engage in certain practices designed to\\ndiscourage or halt third party sales of caskets, such concerted\\naction might also constitute a violation of Section 5 of the FTC\\nAct, which. prohibi ts\" unfair methods of competition in or\\n15 U.\\nC. Section 45(a) (1).\\na1fecting commerce.\\nThank\\n\\nqu for writing to the Commission.\\n\\nWe appreciate your\\n\\nbringing these matters to our attention.\\n\\nSincerely yours,\\n\\nFuneral Rule Coordinator\\n\\n\\x0c'","created_timestamp":"March 10, 1988","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/opinion-04-1\/opinion04-1.pdf"}
{"text":"b'\\x0c\\x0c\\x0c\\x0cCustoms Rulings Online Search System (CROSS) Document Preview\\n\\nPage 1 of 5\\n\\nHQ 966062\\nMarch 11, 2003\\nCLA-2 RR:CR:TE 966062 jsj\\nCATEGORY: Classification\\nTARIFF NO.: 6001.22.0000\\nMr. Herbert J. Lynch Sullivan & Lynch, P.C.\\n156 State Street Boston, Massachusetts 02109-2508\\nRe: Classification; Laminated Warp Knit Pile Fabric; Subheading 6001.22.0000, HTSUSA; Chapter\\n60, Note 1(c); Chapter 59, Note 1; Country of Origin; 19 C.F.R. 102.21 (c)(2).\\nDear Mr. Lynch:\\nThe purpose of this correspondence is to respond to your request dated March 6, 2002, directed to\\nthe National Commodity Specialist Division. The correspondence in issue requested, on the behalf of\\nyour client, Velcro USA, Inc., a binding classification and country of origin ruling of the\\nmerchandise described as laminated warp knit fabric.\\nThis ruling is being issued subsequent to the following: (1) A review of your submission dated\\nMarch 6, 2002; (2) A review of the Customs Service laboratory report number: NY 20020351, dated\\nMay 28, 2002; and (3) An examination of the base fabric sample and the laminated fabric sample.\\nFACTS\\nThe article in issue, identified as laminated warp knit fabric, is formed by laminating a sheet of\\nplastic to a two bar warp knit fabric. The Customs Service Office of Laboratory and Scientific\\nServices, subsequent to examining samples, reported that the lapping movement of the two guide\\nbars moving in unison in the same direction produced an unstable construction with inclined loops.\\nThe lapping movements of the front bar is expressed as 1\/0, 1\/2, with the lapping movements of the\\nback bar expressed as 1\/0, 3\/4. The back bar, which pulls the yarn over two rows of stitches before\\nforming a knit stitch, is adjusted in the formation of this fabric to provide less tension. The result is\\nthe production of a float that projects upward from the surface of the fabric. The projection of the\\nlooped float created by the back guide bar is entirely a function of its relative tension and not any\\nprocess subsequent to knitting. The fabric has not been brushed.\\nThe yarn used in the formation of the Velcro\\xc2\\xae fabric is 100 % nylon. It weighs approximately 72.2\\ngrams per square meters. It will be imported in 101.6 centimeter widths. The fabric, subsequent to\\nformation, is laminated with a sheet of polypropylene plastic that is visible to the naked eye. The\\nplastic sheeting is imprinted with differing designs, including those of animals, in different colors.\\nThe production of the finished Velcro\\xc2\\xae product, the laminated warp knit fabric, is undertaken in the\\nfollowing countries:\\nSpain: The nylon warp knit fabric is formed on warp knitting machines in rolls that are sixty inches\\nwide.\\nGermany: The warp knit fabric, subsequent to export from Spain to Germany, is laminated with\\npolypropylene film that had previously been decorated with water-based acrylic motifs appealing to\\nchildren.\\n\\nhttp:\/\/rulings.customs.gov\/detail.asp?ru=966062&ac=pr\\n\\n2\/25\/2004\\n\\n\\x0cCustoms Rulings Online Search System (CROSS) Document Preview\\n\\nPage 2 of 5\\n\\nThe Customs Service has not been advised whether the nylon yarn is extruded in Spain or whether\\nthe polypropylene film is produced in Germany.\\nISSUE\\nWhat is the classification, pursuant to the Harmonized Tariff Schedule of the United States\\nAnnotated, of the above-described laminated warp knit fabric?\\nWhat is the country of origin of the laminated warp knit fabric that is knitted in Spain and laminated\\nin Germany ?\\nLAW AND ANALYSIS\\nClassification\\nThe federal agency responsible for initially interpreting and applying the Harmonized Tariff\\nSchedule of the United States Annotated (HTSUSA) is the U.S. Customs Service. The Customs\\nService, in accordance with its legislative mandate, classifies imported merchandise pursuant to the\\nGeneral Rules of Interpretation (GRI) and the Additional U.S. Rules of Interpretation.\\nGeneral Rule of Interpretation 1 provides, in part, that classification decisions are to be \"determined\\naccording to the terms of the headings and any relative section or chapter notes.\" General Rule of\\nInterpretation 1. General Rule of Interpretation 1 further states that merchandise which cannot be\\nclassified in accordance with the dictates of GRI 1 should be classified pursuant to the other General\\nRules of Interpretation, provided the HTSUSA chapter headings or notes do not require otherwise.\\nAccording to the Explanatory Notes (EN), the phrase in GRI 1, \"provided such headings or notes do\\nnot otherwise require,\" is intended to \"make it quite clear that the terms of the headings and any\\nrelative Section or Chapter Notes are paramount.\" General Rules for the Interpretation of the\\nHarmonized System, Rule 1, Explanatory Note (V).\\nThe Explanatory Notes constitute the official interpretation of the Harmonized System at the\\ninternational level. See Joint Explanatory Statement supra note 1, at 549. The Explanatory Notes,\\nalthough neither legally binding nor dispositive of classification issues, do provide commentary on\\nthe scope of each heading of the HTSUS. The EN\\xe2\\x80\\x99s are generally indicative of the proper\\ninterpretation of the headings. See T.D. 89-80, 54 Fed. Reg. 35127-28 (Aug. 23, 1989); Lonza, Inc.\\nv. United States, 46 F. 3d 1098, 1109 (Fed. Cir. 1995).\\nCommencing classification of the laminated warp knit fabric, in accordance with the dictates of GRI\\n1, the Customs Service examined the headings of the HTSUSA. Heading 6001, HTSUSA, provides\\nfor the classification of \"[p]ile fabrics, including \\xe2\\x80\\x98long pile\\xe2\\x80\\x99 fabrics and terry fabrics, knitted or\\ncrocheted.\" The principle issue to be addressed by Customs in the classification of this fabric is\\nwhether the fabric is \"pile.\" The Explanatory Notes and prior Customs Service ruling letters assist in\\nresolving this question. Explanatory Note 60.01 provides, in part:\\nUnlike the woven fabrics of heading 58.01, the products of this heading are obtained by knitting.\\nThe following methods of production are those mainly used:\\na circular knitting machine produces a knitted fabric in which, by means of an additional yarn,\\nprotruding loops are formed; afterwards the loops are cut to form pile and thus give a velvet-like\\nsurface; a special warp knitting machine knits two fabrics face to face with a common pile yarn; the\\ntwo fabrics are then separated by cutting to produce two knitted fabrics with a cut pile; textile fibres\\nfrom a carded sliver are inserted into the loops of a knitted ground fabric as it is formed (\"long pile\"\\nfabrics); textile yarn to form loops (\"imitation terry fabrics\") (see General Explanatory Note). Such\\nfabrics have rows of chain stitches on the back of the fabric and they differ from the pile facrics of\\nheading 58.02, which are characterised by rows of stitches having the appearance of running stitches\\nalong the length of the back of the fabric. (Emphasis added).\\n\\nhttp:\/\/rulings.customs.gov\/detail.asp?ru=966062&ac=pr\\n\\n2\/25\/2004\\n\\n\\x0cCustoms Rulings Online Search System (CROSS) Document Preview\\n\\nPage 3 of 5\\n\\nCustoms, relying on EN 60.01, has previously concluded that the processes enumerated in the EN are\\nillustrative, rather than exclusive. The EN specifically states that the methods of production listed are\\nthose \"mainly used\" in the formation of \"pile\" fabric.\\nThe determinative factor with regards to whether fabric is considered to be \"pile\" fabric is whether\\nthe process utilized results in the production of a fabric with raised loops, not whether the fabricmaking process is listed in the Explanatory Note. As stated in HQ 951374 (Oct. 30, 1992), \"if during\\nthe weaving or knitting of a fabric, yarns are caused to project from the surface(s) (i.e., the base\\nmaterial) of that fabric creating a \\xe2\\x80\\x98pile\\xe2\\x80\\x99 appearance, that fabric will be considered a pile fabric for the\\npurposes of the HTSUSA\\xe2\\x80\\xa6.\" The Velcro\\xc2\\xae fabric subject to this classification ruling comports with\\nthe requirement that yarns project from the surface of the fabric as the result of the fabric-making\\nprocess resulting in the production of a \"pile\" fabric. See generally HQ 953303 (April 9, 1993); HQ\\n953942 (May 7, 1993).\\nChapter 60, Note 1(c) provides, with a single exception, that knitted or crocheted fabrics that are\\nimpregnated, coated, covered or laminated are classified in Chapter 59, HTSUSA,. The exception set\\nforth in Chapter 60, Note 1(c) states that knitted or crocheted pile fabrics that are impregnated,\\ncoated, covered or laminated remain classified in heading 6001, HTSUSA. The Velcro\\xc2\\xae fabric falls\\nwithin the exception to Chapter 60, Note 1(c), as it is both a knit pile fabric and laminated. It is,\\ntherefore, classified in heading 6001, HTSUSA.\\nContinuing the classification of the Velcro\\xc2\\xae laminated warp knit pile fabric, the fabric is classified in\\nsubheading 6001.22.0000, HTSUSA. Subheading 6001.22.0000, HTSUSA, provides for the\\nclassification of:\\nPile fabrics, including \"long pile\" fabrics and terry fabrics, knitted or crocheted:\\nLooped pile fabrics:\\n6001.22.0000 Of man-made fibers.\\nCounsel for the importer suggests that the fabric is properly classified in heading 5903, HTSUSA.\\nHeading 5903, HTSUSA, provides for the classification of \"[t]extile fabrics impregnated, coated,\\ncovered or laminated with plastics, other than those of heading 5902.\" The phrase \"textile fabrics\" in\\nheading 5903, HTSUSA, is defined in Chapter 59, Note 1. Chapter 59, Note 1 states that \"[e]xcept\\nwhere the context otherwise requires, for the purposes of this chapter the expression \"textile fabrics\"\\napplies only to the woven fabrics of chapters 50 to 55 and headings 5803 and 5806, the braids and\\nornamental trimmings in the piece of heading 5808 and the knitted or crocheted fabrics of headings\\n6002 to 6006.\" Since the Velcro\\xc2\\xae fabric is classified in heading 6001, HTSUSA, it is not a \"textile\\nfabric\" for the purposes of Chapter 59 or heading 5903, HTSUSA.\\nCountry of Origin\\nThe Uruguay Round Agreements Act, particularly section 334, codified at 19 U.S.C. 3592, as\\namended by section 405 of Title IV of the Trade and Development Act of 2000, sets forth rules of\\norigin for textile and apparel products. Customs, pursuant to legislative authority, published\\nregulations implementing the principles set forth by Congress.\\nSection 102.21 of Customs regulations establishes, with specifically delineated exceptions, that\\n\"the provisions of this section shall control the determination of the country of origin of imported\\ntextile and apparel products for purposes of the Customs laws\\xe2\\x80\\xa6.\" 19 C.F.R. 102.21. Textile and\\n\\nhttp:\/\/rulings.customs.gov\/detail.asp?ru=966062&ac=pr\\n\\n2\/25\/2004\\n\\n\\x0cCustoms Rulings Online Search System (CROSS) Document Preview\\n\\nPage 4 of 5\\n\\napparel products that are encompassed within the scope of section 102.21 are any goods classifiable\\nin Chapters 50 through 63 of the HTSUSA, as well as goods classifiable under other specifically\\nenunciated subheadings. See 19 C.F.R. 102.21 (b)(5).\\nThe Velcro\\xc2\\xae laminated warp knit pile fabric, as previously determined, is classified in Chapter\\n60, HTSUSA. It is, therefore, a textile product subject to the rules of origin in 19 C.F.R. 102.21. See\\n19 C.F.R. 102.21 (b)(5).\\nThe country of origin of textile and apparel products is determined by the sequential application of\\nparagraphs (c)(1) through (c)(5) of section 102.21. Paragraph (c)(1) provides that \"[t]he country of\\norigin of a textile or apparel product is the single country, territory or insular possession in which the\\ngood was wholly obtained or produced.\" Since the knit fabric was formed in Spain and the\\npolypropylene film was laminated to the fabric in Germany, the origin of the finished laminated warp\\nknit pile fabric cannot be determined by reference to paragraph (c)(1).\\nParagraph (c)(2) of section 102.21 provides that where the country of origin cannot be determined\\naccording to paragraph (c)(1), resort should next be to paragraph (c)(2). The country of origin,\\naccording to paragraph (c)(2), is \"the single country, territory or insular possession in which each\\nforeign material incorporated in that good underwent an applicable change in tariff classification,\\nand\/or met any other requirement, specified for the good in paragraph (e)\" of section 102.21.\\nParagraph (e)(1), as applicable to the instant determination, establishes a tariff shift rule that\\nprovides:\\nHTSUS Tariff Shift and\/or Other Requirement\\n6001-6006 (1) Except for fabric of wool or of fine animal hair, a change from greige fabric of\\nheading 6001 through 6006 to finished fabric of heading 6001 through 6006 by both dyeing and\\nprinting when accompanied by two or more of the following finishing operations: bleaching,\\nshrinking, fulling, napping, decating, permanent stiffening, weighting, permanent embossing, or\\nmoireing; or, (2) If the country of origin cannot be determined under (1) above, a change to heading\\n6001 through 6006 from any heading outside that group, provided that the change is the result of a\\nfabric-making process.\\nSince paragraph (1) of the tariff shift requirement for heading 6001, HTSUSA, does not establish the\\ncountry of origin of the laminated warp knit pile fabric Customs must examine paragraph (2).\\nParagraph (2) of the tariff shift requirement necessitates inquiry into whether the nylon yarn used in\\nthe formation of the fabric is classified in a heading other than headings 6001 through 6006,\\nHTSUSA, and whether the tariff shift to heading 6001, HTSUSA, resulted from a \"fabric-making\\nprocess.\" Although Customs was not advised of the country where the yarn was extruded, since the\\nfabric was formed in Spain and subsequently laminated in Germany, it is not necessary to know the\\ncountry of extrusion of the yarn.\\nThe yarn of which the Velcro\\xc2\\xae fabric is knitted is entirely nylon. Nylon yarn is classified in Chapter\\n54, HTSUSA. Customs Regulations define \"fabric-making process\" to mean \"any manufacturing\\noperation that begins with polymers, fibers, filaments (including strips), yarns, twine, cordage, rope\\nor fabric strips and results in a textile fabric.\" 19 C.F.R. 102.21 (b)(2). Customs is cognizant that the\\nknit pile fabric in issue is laminated. Subsequent to a thorough examination of 19 C.F.R. 102.21 and\\nprior Customs Service ruling letters, it is the decision of this office that the lamination process, with\\nregards to fabric classified in heading 6001, HTSUSA, does not impact the origin determination.\\nIt is Customs decision that the process of knitting nylon yarn classified in Chapter 54, HTSUSA, into\\n\\nhttp:\/\/rulings.customs.gov\/detail.asp?ru=966062&ac=pr\\n\\n2\/25\/2004\\n\\n\\x0cCustoms Rulings Online Search System (CROSS) Document Preview\\n\\nPage 5 of 5\\n\\na textile fabric of heading 6001, HTSUSA, constitutes a manufacturing operation that results in the\\nproduction of a textile fabric. The country of origin of the Velcro\\xc2\\xae laminated warp knit pile fabric,\\nknitted in Spain and laminated in Germany is Spain.\\nHOLDING\\nThe Velcro\\xc2\\xae laminated warp knit pile fabric is classified in subheading 6001.22.0000,\\nHarmonized Tariff Schedule of the United States Annotated.\\nThe General Column 1 Rate of Duty is seventeen and four-tenths (17.4) percent ad valorem.\\nThe textile quota category is 224.\\nThe country of origin of the laminated warp knit pile fabric, knitted in Spain and laminated in\\nGermany is Spain.\\nThe designated textile and apparel category may be subdivided into parts. If subdivided, any quota\\nand visa requirements applicable to the subject merchandise may be affected. Since part categories\\nare the result of international bilateral agreements which are subject to frequent negotiations and\\nchanges, to obtain the most current information available, we suggest your client check, close to the\\ntime of shipment, the Status Report On Current Import Quotas (Restraint Levels) an internal issuance\\nof the U.S. Customs Service which is updated weekly and is available for inspection at the local\\nCustoms Service office. The Status Report On Current Import Quotas (Restraint Levels) is also\\navailable on the Customs Electronic Bulletin Board (CEBB) which can be found on the U.S.\\nCustoms Web site at www.customs.gov.\\nDue to the changeable nature of the statistical annotation (the ninth and tenth digits of the\\nclassification) and the restraint (quota\/visa) categories, your client\\nshould contact its local Customs office prior to importation of this merchandise to determine the\\ncurrent status of any import restraints or requirements.\\nSincerely,\\nMyles B. Harmon, Director\\n\\nCommercial Rulings Division\\n\\nhttp:\/\/rulings.customs.gov\/detail.asp?ru=966062&ac=pr\\n\\n2\/25\/2004\\n\\n\\x0c\\x0c\\x0c\\x0c'","created_timestamp":"March 11, 2003","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/columbia-sportswear\/columbiasports.pdf"}
{"text":"b\"UNITED STATES OF AMERICA\\n\\nFEDERAL TRADE COMMISSION\\nWASHINGTON, D.C. 20580\\n\\nBureau of Competition\\nAlden F. Abbott\\nAssistant Director for Policy and Evaluation\\nDirect Dial\\n(202) 326-2881\\n\\nJanuary 29, 2004\\n\\nMr. Jerald A. Jacobs\\nShaw Pittman LLP\\n2300 N. Street, NW\\nWashington, DC 20037-1128\\nDear Mr. Jacobs:\\nThis letter responds to your request on behalf of the Electronic Retailing Association\\n(\\xe2\\x80\\x9cERA\\xe2\\x80\\x9d) for a Bureau of Competition staff (\\xe2\\x80\\x9cBC staff\\xe2\\x80\\x9d) opinion letter regarding a proposed\\nprogram to review and, if appropriate, recommend discontinuation of DRTV (\\xe2\\x80\\x9cdirect response\\ntelevision\\xe2\\x80\\x9d) shows (e.g., infomercials) and advertising in other media that contain claims that\\nappear on their face to be unreasonable or incapable of substantiation.1 You have asked whether,\\nbased on the facts submitted, BC staff would recommend that the Commission bring an\\nenforcement action challenging implementation of the program. On the basis of information that\\nyou provided in your letter of December 23, 2003, BC staff have no present intention to\\nrecommend a challenge to ERA\\xe2\\x80\\x99s implementation of the DRTV review program as proposed.\\nThis conclusion is entirely dependent on the accuracy of our understanding of pertinent facts\\nconcerning the review program. Our understanding of those facts, in turn, is entirely dependent\\non the information that you provided. Our present enforcement intentions might be different\\nshould the DRTV review program not be as described in your letter and other materials.\\nERA\\xe2\\x80\\x99s Proposed Program\\nWe understand that ERA is the nation\\xe2\\x80\\x99s principal trade association representing the\\nelectronic retailing\/DRTV industry. ERA\\xe2\\x80\\x99s membership includes DRTV producers, media\\nbuyers, product owners, consultants, and other industry firms.\\n\\n1\\n\\nLetter of December 23, 2003 from Jerald A. Jacobs to Alden Francis Abbott, Assistant\\nDirector for Policy and Evaluation, Bureau of Competition.\\n\\n\\x0cMr. Jerald A. Jacobs \\xe2\\x80\\x93 Page 2\\nWe further understand that ERA proposes to establish a separate unit under the umbrella\\nof the National Advertising Review Council (\\xe2\\x80\\x9cNARC\\xe2\\x80\\x9d) to perform the review function.2 We\\nalso understand that the new unit will be funded by ERA, and operate under the rules and\\nprocedures set forth in ERA\\xe2\\x80\\x99s proposal, but would otherwise be under NARC supervision and\\nindependent of ERA. The new unit will initially be staffed by one attorney, experienced in\\nadvertising law and ad substantiation, who will be selected by and work under the supervision of\\nNARC, although ERA may participate in the interviewing process and provide guidance on\\nselection standards and process.\\nWe understand that the review program is intended to identify and effectuate\\ndiscontinuance of advertising that contains claims that appear to be untrue and lack any form of\\ncredible substantiation. The single mission of the review program is to curtail false or deceptive\\nDRTV advertising for the benefit of consumers.\\nWe further understand that reviews may be initiated by the new unit on its own initiative\\nor in response to referrals by any ERA member, consumer, or consumer advocacy group.\\nDecisions on whether to review a referral will be based on the number of consumers affected, the\\ntype of advertising claims involved \\xe2\\x80\\x93 ERA proposes that the reviewing unit focus on advertising\\ncampaigns that involve \\xe2\\x80\\x9chigh impact\\xe2\\x80\\x9d on consumers, such as when health or safety issues are\\ninvolved \\xe2\\x80\\x93 and how egregious the advertising claims appear to be.\\nWe understand that the reviewing unit will notify the marketer whose advertising\\ncampaign is under review, and may request product samples and additional information and\/or\\ndocumentation from the marketer as needed. The review will be limited to the primary or core\\nefficacy or performance claims. The marketer will be required to provide the requested materials\\nwithin 15 calendar days, and, within those 15 days, may request a meeting with the reviewer,\\nwhich meeting shall be held within 15 calendar days of the request. The reviewing unit will\\nmake a decision and notify the marketer within 15 calendar days after receipt of the final\\nsubmission from the marketer or within 15 calendar days of the meeting.\\nReview Standards\\nWe understand that the review will consist of:\\n\\xe2\\x80\\xa2\\n\\n2\\n\\nDetermination\/identification of claims;\\n\\nWe understand that NARC is a strategic alliance of the advertising industry and the\\nCouncil of Better Business Bureaus (\\xe2\\x80\\x9cCBBB\\xe2\\x80\\x9d), formed in 1971 by the Association of National\\nAdvertisers, Inc., the American Association of Advertising Agencies, Inc., the American\\nAdvertising Federation, Inc., and the CBBB to foster truth and accuracy in national advertising\\nthrough voluntary self-regulation.\\n\\n\\x0cMr. Jerald A. Jacobs \\xe2\\x80\\x93 Page 3\\n\\xe2\\x80\\xa2\\n\\nDetermination whether substantiation for claims appears reasonable on its face,\\ne.g.,\\ni)\\n\\nDoes the substantiation address the claims being made?\\n\\nii)\\n\\nIf applicable, does the substantiation meet general standards of competent\\nand reliable scientific evidence?\\n\\nWe understand that the review is intended to be limited, with the goal of identifying\\n\\xe2\\x80\\x9coutliers\\xe2\\x80\\x9d \\xe2\\x80\\x93 egregious primary or core advertising claims that on their face appear unreasonable\\nor incapable of substantiation. The reviewing unit will recommend whether the primary or core\\nclaims that were reviewed should be continued. The reviewing unit is not expected to (but may)\\nmake recommendations regarding how claims should be modified or qualified. The proposed\\nprogram does not include provisions for appeal of the reviewing unit\\xe2\\x80\\x99s decisions.\\nEnforcement\\nWe understand that failure to comply with the reviewing unit\\xe2\\x80\\x99s recommendation to\\ndiscontinue a claim will result in a referral to the FTC or other appropriate agency and expulsion\\nfrom membership in ERA. Failure to comply with a request for information or other materials\\nalso may result in referral to the FTC or other agency. Decisions of the reviewing unit will be\\nmade public through publication in NARC reports. Review decisions and referrals to the FTC or\\nanother agency will also be announced in NARC press releases. Conclusions of the reviewing\\nunit will be qualified \\xe2\\x80\\x93 e.g., \\xe2\\x80\\x9cbased on preliminary evaluation, it appears that certain advertising\\nclaims may not be adequately substantiated.\\xe2\\x80\\x9d\\nFinally, we understand that ERA contemplates that publication of the reviewing unit\\xe2\\x80\\x99s\\ndecisions and actions will benefit ERA members and suppliers such as fulfillment companies,\\ntelemarketing companies, and media services by providing information that will assist them in\\nmaking independent decisions regarding whether to provide goods or services to a noncompliant company.\\nAnalysis of the ERA Proposed DRTV Review Program\\nWe begin with the observation that the antitrust laws do not forbid legitimate selfregulation that benefits consumers. As the Commission has stated, \\xe2\\x80\\x9c[s]uch self-regulatory\\nactivity serves legitimate purposes, and in most cases can be expected to benefit, rather than to\\ninjure, competition and consumer welfare.\\xe2\\x80\\x9d American Academy of Ophthalmology, 101 F.T.C\\n1018 (1983) (advisory opinion); see also American Medical Association, 117 F.T.C. 1091 (1994)\\n(advisory opinion); American Medical Association, 94 F.T.C. 701, 1029 (1979), aff'd as\\nmodified, 638 F.2d 443 (2d Cir. 1980), aff'd by an equally divided Court, 455 U.S. 676 (1982)\\n(\\xe2\\x80\\x9cAMA\\xe2\\x80\\x9d). On the other hand, conduct that unreasonably restricts competition is inconsistent\\nwith the antitrust laws.\\n\\n\\x0cMr. Jerald A. Jacobs \\xe2\\x80\\x93 Page 4\\nWe also note at the outset that ERA\\xe2\\x80\\x99s DRTV review program is in many respects similar\\nto a standard-setting and standard-compliance program, and that precedents dealing with these\\nkinds of programs are therefore helpful in the analysis of the ERA\\xe2\\x80\\x99s proposed program.3\\nSpecifically, under the review process, recommendations regarding whether ERA members\\nshould continue or discontinue an advertiser\\xe2\\x80\\x99s commercial will depend on whether the\\ncommercial satisfies a standard of reasonableness (capacity to be substantiated) with respect to\\nthe claims made in the commercial. The reasonableness standard, in turn, is solely determined\\nby ERA through NARC. ERA, through NARC, is thus, in this respect, both a standard-setting\\nbody and an evaluator of compliance with the adopted standard.\\nAs a general principle, industry adoption of private standards and voluntary compliance\\nwith those standards often, if not typically, promote competition by enhancing price and quality\\nrivalry and by increasing consumer confidence in product quality and thereby increase demand,\\nand facilitate entry of new sellers. It is inherent in a standards system, however, that some\\nproducts may fail to satisfy the standards, and therefore may tend to be excluded from the\\nmarketplace. This effect is not inherently anticompetitive, but an unreasonable restraint on\\ncompetition may arise under some circumstances. For this reason, the actions of standard-setting\\nbodies are subject to scrutiny under the antitrust laws.4 See, e.g., Allied Tube & Conduit Corp. v.\\nIndian Head, Inc., 486 U.S. 492, 500 (1988); American Soc\\xe2\\x80\\x99y of Mechanical Eng\\xe2\\x80\\x99rs, Inc. v.\\nHydrolevel Corp., 456 U.S. 556, 572-73 (1982).\\nCompetitive concerns can arise, for example, when competitors abuse or distort the use\\nof standards for the purpose of restricting competition, thus imposing harm on the market and\\nconsumers while not providing the procompetitive benefits that can flow from compliance with\\nindustry standards.5 In addition, the adoption of an industry standard may, in effect, be an\\n3\\n\\nThere is one significant difference between the ERA\\xe2\\x80\\x99s proposed program and\\nstandardization programs. An industry group might voluntarily adopt standard specifications to\\nensure that its members offer particularly high quality products or products that appeal to\\nspecific consumer preferences (like a preference for \\xe2\\x80\\x9corganic\\xe2\\x80\\x9d food). Many consumers may\\nprefer non-standard offerings (perhaps at lower prices), however, and it is therefore necessary to\\nconsider whether the standardization program will foreclose competition from non-compliant\\nsellers and thus reduce output and consumer welfare. Because the ERA\\xe2\\x80\\x99s program does not\\nestablish product standards but seeks only to exclude egregiously false claims, it is not necessary\\nto be concerned about an adverse effect on competitive opportunities for products that are\\ndeceptively promoted.\\n4\\n\\nThe actions of groups or associations such as ERA comprised of entities with horizontal\\nbusiness relationships (i.e., competitors) are deemed, under the antitrust laws, to be concerted\\naction.\\n5\\n\\nE.g., Allied Tube, 486 U.S. at 501; Accrediting Commission on Career Schools\\nand Colleges of Technology, 119 F.T.C. 977 (1995) (advisory opinion; Commission declined to\\napprove a proposed accreditation standard that would define acceptable tuition levels, reasoning\\n\\n\\x0cMr. Jerald A. Jacobs \\xe2\\x80\\x93 Page 5\\nagreement not to sell non-compliant products.6 Competitive concerns may arise when the\\nstandard is not reasonably necessary to attain procompetitive objectives.7\\nERA\\xe2\\x80\\x99s adoption of the proposed review program would be an agreement among\\ncompetitors to restrict a certain kind of DRTV advertising, i.e., advertising that does not meet\\nERA\/NARC substantiation standards. As such, it raises two potential antitrust concerns. First,\\nthe program could be characterized simply as a non-competition agreement, i.e., an agreement\\namong ERA members, by means of enforcement of a standard, not to compete for the business of\\nparticular advertisers. Second, the expulsion from ERA of a member that refuses to comply with\\nthe review program requirements could be characterized as a group boycott.\\nBC staff would analyze both of these issues under the \\xe2\\x80\\x9crule of reason\\xe2\\x80\\x9d test rather than the\\nper se test.8 Under a rule of reason test, BC staff weighs the potential for competitive harm\\narising from an agreement among competitors against any procompetitive or efficiency benefits\\nproduced by the agreement. If BC staff concludes that the procompetive benefits more than\\noffset the likely competitive harm, BC staff will not pursue an enforcement action. Given the\\nfacts as we understand them in this instance, it is unlikely that BC staff would conclude that\\npotential anticompetitive effects arising from the implementation of ERA\\xe2\\x80\\x99s DRTV review\\nprogram would outweigh procompetitive benefits. We find therefore that ERA\\xe2\\x80\\x99s DRTV review\\nprogram does not merit a staff recommendation to the Commission for enforcement action at this\\ntime. We reach this conclusion for a number of reasons.\\nFirst, truthful, non-deceptive advertising promotes competition by providing consumers\\nwith important information about product prices, quality, and availability, among other factors\\nthat consumers consider in their purchasing decisions. See, e.g., Virginia State Board of\\nPharmacy v. Virginia Citizens Consumer Council, Inc., 425 U.S. 748, 765 (1976). Agreements\\non standards among competitors that restrict truthful, nondeceptive advertising, therefore, have\\nthe potential to restrict competition and harm consumers. See, e.g., American Medical\\nAssociation, 94 F.T.C. at 1005. Such agreements harm consumers by raising the cost of finding\\nthe combination of price, service, and quality that best fits their needs and by reducing the\\nincentive for firms to compete (by preventing them from informing consumers of their prices,\\nservices, or quality). Id. By contrast, false or deceptive advertising does not produce the same\\nbenefits for consumers as truthful advertising, and, therefore, agreements among competitors on\\n\\nthat this would in effect be an agreement among members of the accrediting body to charge no\\nmore than the standard would permit).\\n6\\n\\nId.\\n\\n7\\n\\nE.g., American Soc\\xe2\\x80\\x99y of Sanitary Eng\\xe2\\x80\\x99rs, 106 F.T.C. 324 (1985) (consent order).\\n\\n8\\n\\nSpecifically, BC staff\\xe2\\x80\\x99s analysis would follow the framework set out in the Federal\\nTrade Commission\/Department of Justice Guidelines for Collaborations Among Competitors,\\navailable at http:\/\/www.ftc.gov\/os\/2000\/04\/ftcdojguidelines.pdf.\\n\\n\\x0cMr. Jerald A. Jacobs \\xe2\\x80\\x93 Page 6\\nstandards that are aimed at restricting deceptive advertising present less antitrust concern;\\nindeed, restricting deceptive advertising may help avoid anticompetitive effects. Calif. Dental\\nAssn. v. FTC, 526 U.S. 756, 773 n.9 (1999) (\\xe2\\x80\\x9cThat false or misleading advertising has an\\nanticompetitive effect, as that term is customarily used, has been long established.\\xe2\\x80\\x9d) ERA\\xe2\\x80\\x99s\\nreview program appears to fall into this second class of restrictions.\\nSecond, both the agreement to adopt a standard and the standard itself are not product or\\nadvertiser-specific. Because ERA represents a wide spectrum of marketers that use DRTV\\nadvertising, the agreement would relate to a class of advertising rather than specific products.\\nThat fact would attenuate any adverse consumer impact.\\nThird, ERA\\xe2\\x80\\x99s proposed program appears to have a significant pro-consumer rationale by\\nrestricting advertising that is deemed to be facially unreasonable or incapable of substantiation.\\nAccording to ERA, the overriding purpose of the proposed program is to curtail false or\\ndeceptive DRTV advertising, rather than to restrict competition. The restriction of such\\nadvertising likely would increase consumer confidence in DRTV and make the overall market\\nmore efficient. See Calif. Dental Assn. v. FTC, 526 U.S. at 771-772 (restrictions designed for the\\npurpose of avoiding false or deceptive advertising might plausibly have a net procompetitive\\neffect).\\nFourth, the review program will be administered under the umbrella of NARC and not\\ndirectly by ERA. Although, because of ERA funding and participation in staff interviewing, the\\nreviewing unit cannot be characterized as fully independent of ERA, there is nonetheless some\\ndegree of separation between the reviewing unit and ERA respecting the actual screening and\\ndecision-making process. This separation tends to lessen the possibility that the program could\\nbe manipulated by horizontal competitors for the purpose of restraining competition for their\\nproducts.9 Furthermore, NARC will control the rules and procedures used by the reviewing unit\\nafter formation.\\nFifth, while the expulsion of a member for non-compliance with program requirements\\ncould be characterized as a horizontal boycott, there will not be an effect on competition in the\\nmarketing of the expelled member\\xe2\\x80\\x99s product unless two or more members actually compete in\\nthe marketing of that product or reasonable substitutes. Further, even if there is extant\\ncompetition with respect to the marketing of that particular product, expulsion of a noncompliant member may not be unreasonably exclusionary. In general, expulsion from a trade\\ngroup characteristically is not likely to result in predominantly anticompetitive effects. See\\nNorthwest Wholesale Stationers, Inc. v. Pacific Stationery & Printing Co., 472 U.S. 284, 286\\n(1985). According to ERA, membership does not have significant competitive ramifications.\\nAlthough loss of membership results in the loss of ERA\\xe2\\x80\\x99s trade association services, those\\nservices are not essential to competition or competitors.\\n\\n9\\n\\nEvidence to the contrary would cause serious antitrust concerns.\\n\\n\\x0cMr. Jerald A. Jacobs \\xe2\\x80\\x93 Page 7\\nFinally, we understand that ERA plans to encourage members not to deal with marketers\\nthat refuse to comply with the reviewing unit\\xe2\\x80\\x99s procedures and decisions. BC staff would not\\nrecommend enforcement action by virtue of ERA simply encouraging members not to deal with\\nnon-compliant marketers, so long as the actions of the members remain voluntary. By contrast, a\\nrequirement that members refrain from dealing with such marketers could be viewed as a boycott\\nor an agreement not to compete for that marketer\\xe2\\x80\\x99s business, and therefore may be subjected to\\nheightened BC staff scrutiny.\\n\\nConclusion\\nFor all the reasons stated above, we believe that, on balance, the likely benefits of ERA\\xe2\\x80\\x99s\\nproposed review program more than offset the potential for competitive harm. On this basis, BC\\nstaff have no present intention to recommend a challenge to ERA\\xe2\\x80\\x99s proposed DRTV review\\nprogram.\\nThis letter sets out the views of the staff of the Bureau of Competition, as authorized by\\nRule 1.1(b) of the Commission's Rules of Practice, 16 C.F.R. \\xc2\\xa7 1.1(b). Under Commission Rule\\n1.3(c), 16 C.F.R. \\xc2\\xa7 1.3(c), the Commission is not bound by this staff opinion and reserves the\\nright to rescind it at a later time. In addition, this Office retains the right to reconsider the\\nquestions involved and, with notice to the requesting party, to rescind or revoke the opinion if\\nimplementation of the proposed program results in substantial anticompetiutive effects, if the\\nprogram is used for improper purposes, if facts change significantly, or if it would be in the\\npublic interest to do so.\\nSincerely yours,\\n\\nAlden F. Abbott\\nAssistant Director\\nfor Policy & Evaluation\\n\\n\\x0c\"","created_timestamp":"January 29, 2004","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/electronic-retailing-association\/040129eraopinion.pdf"}
{"text":"b\"UNITED STATES OF AMERICA\\n\\nFEDERAL TRADE COMMISSION\\nWASHINGTON, D.C. 20580\\n\\nBureau of Competition\\nAlden F. Abbott\\nAssistant Director\\nDirect Dial\\n(202) 326 2881\\n\\nDiane L. Weinberg, Esquire\\nMeeks & Sheppard\\n330 Madison Avenue, 39th Floor\\nNew York, NY 10017\\nRe:\\n\\nAmerican Down & Feather Section\\nHome Fashion Products Association\\nRequest for Staff Opinion Letter\\nFTC File No. P002501\\n\\nDear Ms. Weinberg:\\nThis letter responds to your request on behalf of the American Down & Feather Section\\nof the Home Fashion Products Association (AD&FS) for a staff opinion letter regarding a\\nproposed Labeling Compliance Program. You have asked whether, based on the facts submitted,\\nthe Commission Staff would recommend that the Commission bring an enforcement action\\nchallenging implementation of the AD&FS proposal. On the basis of information you provided\\nin your letters of May 1, 2003, June 9, 2003, and June 24, 2003, Commission staff have no\\npresent intention to recommend a challenge to AD&FS\\xe2\\x80\\x99s implementation of the Compliance\\nProgram as proposed.\\nAD&FS and the Proposed Labeling Compliance Program\\nWe understand that AD&FS is a voluntary association of dealers, buyers, sellers and\\nprocessors of raw feathers and down in home fashion products. As of June 9, 2003, AD&FS had\\n21 members, of which 18 were manufacturers of finished products containing down and feather,\\ntwo were importers of finished products, and one was a supplier of processed down and\\nfeathers.1\\n\\n1\\n\\nCommission.\\n\\nLetter of June 9, 2003, to the Office of Policy and Evaluation, Federal Trade\\n\\n\\x0cAD&FS proposes to implement a Labeling Compliance Program with two stated\\nobjectives: (1) \\xe2\\x80\\x9cto assure that all members [of AD&FS] and non-members are in compliance\\nwith Industry Standards adopted by the ADA . . . and reaffirmed by a majority vote of the\\nAD&FS,\\xe2\\x80\\x9d and (2) \\xe2\\x80\\x9cto further assure that all representations and claims made on the product, on\\nthe packing, and in advertising are truthful and in accordance with Industry Standards and the\\nLaw.\\xe2\\x80\\x9d2 To that end, AD&FS proposes to implement a Labeling Compliance Program, which\\ninvolves the physical testing of products, upon receipt of a complaint from a member, to ensure\\nthat those products meet Industry Standards. AD&FS proposes to impose various sanctions for\\nnon-compliance with Industry Standards. You have explained that the process for considering\\ncomplaints regarding representations, claims, and advertising, to ensure compliance with\\nIndustry Standards and State and Federal law, also will involve physical testing of the product as\\nset forth in the Labeling Compliance Program.3\\nAny member of AD&FS may bring a complaint to the AD&FS Standards and Testing\\nCommittee, asserting that another company\\xe2\\x80\\x99s product does not comply with Industry Standards,\\nor that another company\\xe2\\x80\\x99s representations, claims, and advertising do not comply with Industry\\nStandards or with state law or federal law. The Program will apply only to various home\\nfurnishing products in their finished state; it will not apply to intermediate products or inputs into\\nfinished goods.4 Complaints may be brought against non-members as well as members of\\nAD&FS. AD&FS estimates that no more than six non-member entities, primarily importers,\\nwould be subject to the AD&FS complaint process.5 Upon receipt of a complaint, the\\nCommittee will initiate a process of testing or evaluation, and, if the accused company is found\\nnot in compliance, the AD&FS may undertake sanctions against the company. Our\\nunderstanding of the details of the proposed Compliance Program is set forth below.\\nComplaints Regarding Non-Compliance with Industry Standards\\nThe Industry Standards specify the requirements for product attributes in seven\\ncategories: (A) Down Cluster content (with different standards depending on whether the\\nproduct bears a \\xe2\\x80\\x9cDown\\xe2\\x80\\x9d label, a \\xe2\\x80\\x9cDown & Feather\\xe2\\x80\\x9d label, or a \\xe2\\x80\\x9cFeather & Down\\xe2\\x80\\x9d label); (B)\\nGoose Specie content; (C) Filling Power; (D) Oxygen #; (E) Turbidity; (F) Thread Count; and\\n(G) Filling Weight.\\nCompliance with the Industry Standard is evaluated under a \\xe2\\x80\\x9cWeighted Point System\\xe2\\x80\\x9d\\n\\n2\\n\\nProposed Labeling Compliance Program, Home Fashion Products Association,\\nAmerican Down & Feather Section, dated April 30, 2003, at \\xc2\\xb6 1. We understand the ADA to be\\nthe American Down Association, the predecessor to AD&FS.\\n3\\n\\nLetter of June 24, 2003, to the Office of Policy and Evaluation, Federal Trade\\n\\nCommission.\\n4\\n\\nLetter of June 24, 2003, to the Office of Policy and Evaluation, Federal Trade\\n\\nCommission.\\n5\\n\\nCommission.\\n\\nLetter of June 9, 2003, to the Office of Policy and Evaluation, Federal Trade\\n\\n\\x0cthat rates a product in each category of performance covered by the standard. A product that\\nmeets the standard for a given category is deemed to \\xe2\\x80\\x9cpass\\xe2\\x80\\x9d that standard. A non-complying\\nproduct is assigned a specified number of \\xe2\\x80\\x9cpoints\\xe2\\x80\\x9d depending on the degree of failure. Four\\nsamples of the product are tested in each category, and the final score for each category is\\ncalculated by averaging the four tests. A product that receives 1-7 total points is deemed to pass;\\n8 or more total points, or 5 or more points in any one category, results in a failure. The\\ntolerances applied in this system are said to be consistent with Industry Standards. All sampling,\\nclassification, and testing of the filling material is required to satisfy the International Down and\\nFeather Bureau (\\xe2\\x80\\x9cIDFB\\xe2\\x80\\x9d) Standards and be performed by one of three certified IDFB testing\\nlabs.\\nIf the initial round of testing of four samples results in a failure, the Program Manager\\nwill purchase a second round of four samples of the same or similar product and repeat the\\ntesting.6 If the second round of testing results in a failure, the company that failed the testing\\nwill have an opportunity to appeal the findings and request additional testing at its expense.7\\nUnder the appeal process, the Program Manager will purchase four more samples of the\\nsame or similar product for a third round of testing. Third round samples will be tested in all\\nthree certified labs. The results of the second and third round of testing will be averaged\\ntogether to determine pass or fail. The same procedures for sampling and testing, and the same\\nappeal rights, apply to members and non-members.\\nAn AD&FS member found not in compliance with Industry Standards is subject to one\\nyear of probation, whereby the company is de-listed from the membership roster and is required\\nto pay for additional rounds of sampling and testing. If the company passes the additional\\nrounds of testing, it is taken off probation and all membership rights are reinstated. If the\\ncompany fails the additional rounds of testing, refuses to participate and fund the additional\\nrounds of testing, or does not pay its dues and its share of AD&FS expenses during the probation\\nperiod, it will be expelled from membership. Ongoing violations may be reported to appropriate\\ngovernmental agencies.\\nA non-member that is found not in compliance with Industry Standards will be notified in\\nwriting that failure to comply will result in notification to the appropriate governmental\\nauthorities.\\nComplaints Regarding Representations, Claims, or Advertising\\nThe proposed Labeling Compliance Program states that \\xe2\\x80\\x9c[i]f the complaint being\\n\\n6\\n\\nThe Program Manager is a third party retained by AD&FS to administer the\\n\\nProgram.\\n7\\n\\nThe cost of the first round of samples and testing is the responsibility of the\\nparty bringing the complaint. The AD&FS will initially pay for the second round of samples and\\ntesting; in the event of a pass the complaining company will be billed for the samples and\\ntesting, and in the event of a failure the accused company will be billed for the samples and\\ntesting.\\n\\n\\x0csubmitted is regarding representations, claims, or advertising, the AD&FS will consider each on\\na case by case basis and determine the appropriate action;\\xe2\\x80\\x9d the proposal does not describe the\\nprocess for evaluating such complaints, the standards to be applied, or the actions that may be\\ntaken if claims are determined not to be correct. Based on your letter of June 24, 2003, it now\\nappears, and we will assume for purposes of the analysis set forth in this letter, that the\\nevaluation of complaints regarding representations, claims, and advertising will involve no more\\nthan a testing of products to determine whether the representations, claims, or advertising at\\nissue are consistent with actual product attributes. We will also assume that the actions that may\\nbe taken by AD&FS, in the event claims are not substantiated, will be limited to the sanctions\\nthat may be imposed in the event a product is found not to comply with Industry Standards.8\\nAnalysis of the Proposed Compliance Program\\nWe begin with the observation that the antitrust laws do not forbid legitimate selfregulation that benefits consumers. As the Commission has stated, \\xe2\\x80\\x9c[s]uch self-regulatory\\nactivity serves legitimate purposes, and in most cases can be expected to benefit, rather than to\\ninjure, competition and consumer welfare.\\xe2\\x80\\x9d American Academy of Ophthalmology, 101 F.T.C.\\n1018 (1983) (advisory opinion); see also American Medical Association, 117 F.T.C. 1091 (1994)\\n(advisory opinion); American Medical Association, 94 F.T.C. 701, 1029 (1979), aff'd as\\nmodified, 638 F.2d 443 (2d Cir. 1980), aff'd by an equally divided Court, 455 U.S. 676 (1982)\\n(\\xe2\\x80\\x9cAMA\\xe2\\x80\\x9d). On the other hand, conduct that unreasonably restricts competition is inconsistent\\nwith the antitrust laws.\\nWe also note that voluntary private standards generally have the potential to promote\\ncompetition by providing useful information to consumers and making it easier for them to\\nselect among providers of a product or service. By providing information about quality and\\nperformance of products or services, voluntary private standards may facilitate quality\\ncompetition and price\/quality comparisons, increase consumer confidence in product quality and\\nthereby increase demand, and facilitate entry of new sellers.\\nIt is inherent in a standards system, however, that some products may fail to satisfy the\\nstandards, and therefore may tend to be excluded from the marketplace.9 The effect is not\\ninherently anticompetitive, but an unreasonable restraint on competition may arise under some\\ncircumstances. The actions of standard-setting bodies, therefore, are subject to scrutiny under\\nthe antitrust laws.10 See, e.g., Allied Tube & Conduit Corp. v. Indian Head, Inc., 486 U.S. 492,\\n500 (1988); American Soc\\xe2\\x80\\x99y of Mechanical Eng\\xe2\\x80\\x99rs, Inc. v. Hydrolevel Corp., 456 U.S. 556, 57273 (1982).\\n\\n8\\n\\nShould either of these assumptions be incorrect, our analysis of the proposed\\nprogram may require modification insofar as it relates to the program for handling complaints\\nregarding representations, claims, and advertising.\\n9\\n\\nProducts that do not meet the standard may be disfavored, and, even under a\\nvoluntary standards program, non-compliant products may be disadvantaged in the market.\\n10\\n\\nThe actions of standards groups controlled by entities with horizontal business\\nrelationships (i.e., competitors) are deemed concerted action.\\n\\n\\x0cCompetitive concerns can arise, for example, when competitors abuse or distort the\\nstandard-setting process for the purpose of restricting competition, thus imposing harm on the\\nmarket and consumers while not providing the procompetitive benefits that can flow from\\nstandard-setting programs.11 In addition, the adoption of a standard may, in effect, be an\\nagreement not to sell non-compliant products.12 Competitive concerns may arise when the\\nstandard is not reasonably necessary to attain procompetitive objectives.13\\nAlthough the actions of the AD&FS in adopting the Industry Standards are not the focus\\nof this letter, efforts to enforce standards also can raise antitrust concerns.14 The proposal to test\\nproducts for compliance with Industry Standards, and to impose sanctions for non-compliance,\\nwill be evaluated from two perspectives. First, do the procedures themselves present any risk of\\nunreasonably restraining competition? For example, procedures that can be applied arbitrarily or\\nin a discriminatory manner may, in some circumstances, be used to unreasonably raise rivals\\xe2\\x80\\x99\\ncosts to such an extent as to substantially lessen competition. Second, are the proposed sanctions\\nlikely to result in a substantial lessening of competition?\\nProduct Testing\\nBased on the information provided, the procedures for testing products for compliance\\nwith Industry Standards do not appear likely to present a risk to competition. The procedures\\nappear to be reasonably formulated to achieve the stated objective. The Industry Standards\\nthemselves appear to be clearly defined, and the procedures for testing products for compliance\\nwith the standards appear reasonably likely to ensure objectivity in their application. The\\ncompliance program requires that sampling and testing satisfy independent third-party standards,\\nand be performed by an independent third party lab. Further, the fact that a complaining party\\nmust bear the costs for the first round of samples and testing, and also for the second round if the\\n\\n11\\n\\nE.g., Allied Tube, 486 U.S. at 496 (manufacturers \\xe2\\x80\\x9cpacked\\xe2\\x80\\x9d meeting at which\\nstandard was to be voted upon, in order to prevent approval of a competing product); Hydrolevel,\\n456 U.S. at 560-64 (manufacturer manipulated the process to obtain an unjustified interpretation\\nof a safety code, declaring a competitor\\xe2\\x80\\x99s product unsafe); Dell Computer Corp., 121 F.T.C. 616\\n(1996) (consent order) (failure of a participant in a standard setting process to disclose its patent\\nposition, contrary to the rules of the organization; after its technology was adopted in the\\nstandard, the company sought to enforce the patent).\\n12\\n\\nE.g., Allied Tube, 486 U.S. at 501; Accrediting Commission on Career Schools\\nand Colleges of Technology, 119 F.T.C. 977 (1995) (advisory opinion; Commission declined to\\napprove a proposed accreditation standard that would define acceptable tuition levels, reasoning\\nthat this would in effect be an agreement among members of the accrediting body to charge no\\nmore than the standard would permit).\\n13\\n\\n14\\n\\nE.g., American Soc\\xe2\\x80\\x99y of Sanitary Eng\\xe2\\x80\\x99rs, 106 F.T.C. 324 (1985) (consent order).\\n\\nWe express no opinion on the substantive reasonableness of the standards. Based\\non the information presently before us, however, we have no reason to believe that the standards\\nthemselves are unreasonably restrictive. This informs our analysis of the proposed Labeling\\nCompliance Program.\\n\\n\\x0ctesting results in a pass, may lessen the likelihood that complaints will be brought without\\nreasonable cause.15 In addition, the same procedures are applicable to the products of both\\nmembers and non-members. These factors tend to ensure impartiality in the application of the\\ncompliance program.\\nThe proposed program also incorporates an appeals process that provides for objective\\nretesting of products found not to be in compliance, using additional samples and additional\\ntesting labs. Although the antitrust laws do not require standards groups to apply any particular\\ndue process procedures, and the presence of such mechanisms is not determinative of the\\nantitrust analysis, adequate procedural safeguards lessen the possibility of exclusionary conduct\\nin the guise of self regulation. See Allied Tube & Conduit Corp. v. Indian Head Inc., 486\\nU.S.492 (1988); Silver v. New York Stock Exchange, 373 U.S. 341, 36-67 (1963).\\nFinally, given the number of firms that manufacture or import down and feathercontaining products, it does not appear likely that a competitive disadvantage visited upon any\\nsingle firm would adversely affect competition in the industry as a whole.16\\nFor the forgoing reasons, the procedures themselves do not appear likely to present a risk\\nto competition.\\nEvaluation of Complaints Regarding Representations, Claims, or Advertising\\nTo the extent that the evaluation of complaints regarding representations, claims, or\\nadvertising is limited to the testing of products to determine whether they are in compliance with\\nIndustry Standards, as stated in your letter of June 24, 2003, this aspect of the proposed Labeling\\nCompliance Program does not require separate analysis \\xe2\\x80\\x93 our observations regarding testing\\nprocedures (above) and sanctions (see below) are applicable in this context. We will note,\\nhowever, that agreements among competitors to restrict truthful, nondeceptive advertising have\\nthe potential to restrict competition and harm consumers. See, e.g., American Medical\\nAssociation, 94 F.T.C. at 1005. Such agreements may harm consumers by raising the cost of\\nfinding the combination of price, service, and quality that best fits their needs and by reducing\\nthe incentive for firms to compete (by preventing them from informing consumers of their prices,\\n\\n15\\n\\nHowever, the fact that a complainant may be required to bear some costs is not a\\nguarantee that the complaint will not be motivated by anticompetitive objectives. Under some\\ncircumstances, a complainant may be willing to incur those costs if it can reduce the level of\\ncompetition in the market by disadvantaging competitors, as by raising their costs\\ndisproportionately. In the present instance, however, although we lack specific information on\\nthe costs that may be imposed upon the complainant and the accused company, it does not\\nappear likely that testing costs would be of such magnitude as to affect the competitive balance.\\n16\\n\\nAlthough we lack sufficient information to determine the relevant antitrust\\nmarket, we note that the group of firms that manufactures or imports down and feathercontaining products is relatively unconcentrated. AD&FS members constitute a sizeable\\npercentage of that group, but the effects of the testing process on any given firm, standing alone,\\ndo not appear likely to affect competition adversely, so long as competition among other firms is\\nnot constrained.\\n\\n\\x0cservices, or quality). Id.\\nSeveral factors suggest that AD&FS\\xe2\\x80\\x99s proposed compliance program regarding\\nrepresentations, claims, and advertising is unlikely to harm competition. First, this aspect of the\\nprogram is limited to the physical testing of products against Industry Standards. Second, the\\ntesting procedures appear to be objective and narrowly tailored to achieve the stated purposes.\\nThird, the proposed program may make consumers more likely to purchase from AD&FS\\nmembers without concern that they are purchasing substandard merchandise. For these reasons,\\nthe restrictions, far from harming competition, may well promote it.\\nSanctions for Non-Compliance with Industry Standards\\nYou have asked that this staff opinion letter specifically address three questions:\\n\\xe2\\x80\\xa2\\n\\nWhether AD&FS may report a non-compliant party to state and federal\\nauthorities;\\n\\n\\xe2\\x80\\xa2\\n\\nWhether AD&FS may list a non-compliant company on a website or in another\\npublic forum; and\\n\\n\\xe2\\x80\\xa2\\n\\nWhether AD&FS may place members that are non-compliant on probation or\\nexpel them.\\n\\nThe proposed sanctions do not appear, on their face, to be unreasonably exclusionary.\\nFirst, the reporting of a non-compliant company to state and federal authorities appears unlikely,\\nin itself, to result in a substantial lessening of competition. Although such action may cause the\\nallegedly non-compliant company to incur some costs, such as legal fees, we have no reason to\\nbelieve, based on current information, that the rival\\xe2\\x80\\x99s costs would increase by such an amount as\\nto substantially impair its ability to compete and adversely affect competition in the market.\\nFurther, the reporting of a company that is reasonably believed to be non-compliant may\\nultimately have a salutary effect on the market by increasing consumer confidence in products\\nfound in the market.\\nSecond, the listing of a non-compliant company on a website or in another public forum\\nappears unlikely, in itself, to result in a substantial lessening of competition. The public\\nidentification of a company that is reasonably believed to be non-compliant may ultimately have\\na salutary effect on the market by increasing consumer confidence in products found in the\\nmarket. Thus, unless the underlying disciplinary action itself violates the antitrust laws,\\npublication of a disciplinary action or the fact of non-compliance is not likely to violate the\\nantitrust laws.17\\nThird, expulsion from AD&FS of a member found to be non-compliant, or placing such a\\nmember on probation, does not appear, on the basis of the information provided, to be\\nunreasonably exclusionary. In general, expulsion from a trade group characteristically is not\\n\\n17\\n\\nSee American Medical Association, 117 F.T.C. at 1105.\\n\\n\\x0clikely to result in predominantly anticompetitive effects.18 As stated by the Supreme Court,\\n\\xe2\\x80\\x9c[u]nless the organization has market power or exclusive access to an element essential to\\neffective competition, the conclusion that expulsion is virtually always likely to have an\\nanticompetitive effect is not warranted.\\xe2\\x80\\x9d19\\nBased on the information before us, probation or expulsion of a member from AD&FS\\nlikely would not result in denial of \\xe2\\x80\\x9caccess to an element essential to effective competition.\\xe2\\x80\\x9d\\nYou have stated that the primary benefit of AD&FS that would be lost if a member is placed on\\nprobation or expelled because of violating Industry Standards would be the inability to\\nparticipate in the association\\xe2\\x80\\x99s decision-making.20 Such participation does not appear to rise to\\nthe level of an \\xe2\\x80\\x9celement essential to effective competition.\\xe2\\x80\\x9d In addition, although the members\\nof AD&FS represent a sizeable percentage of the manufacturers and importers of products\\ncontaining down and feathers, the information presently before us does not suggest that\\ncompetition in the industry would be significantly affected by the expulsion of one member.21\\nConclusion\\nFor the reasons discussed above, Commission staff have no present intention to\\nrecommend a challenge to AD&FS\\xe2\\x80\\x99s proposed conduct. This letter sets out the views of the staff\\nof the Bureau of Competition, as authorized by Rule 1.1(b) of the Commission's Rules of\\nPractice, 16 C.F.R. \\xc2\\xa7 1.1(b). Under Commission Rule 1.3(c), 16 C.F.R. \\xc2\\xa7 1.3(c), the\\nCommission is not bound by this staff opinion and reserves the right to rescind it at a later time.\\nIn addition, this office retains the right to reconsider the questions involved and, with notice to\\nthe requesting party, to rescind or revoke the opinion if implementation of the proposed program\\nresults in substantial anticompetitive effects, if the program is used for improper purposes, if\\nfacts change significantly, or if it would be in the public interest to do so.\\n\\nSincerely yours,\\n\\nAlden F. Abbott\\nAssistant Director\\nfor Policy & Evaluation\\n\\n18\\n\\nSee Northwest Wholesale Stationers, Inc. v. Pacific Stationery & Printing Co.,\\n472 U.S. 284, 286 (1985).\\n19\\n\\nId.\\n\\n20\\n\\nLetter of June 9, 2003, to the Office of Policy and Evaluation, Federal Trade\\n\\nCommission.\\n21\\n\\nIn contrast, for example, expulsion could raise serious questions if it were\\nintended to reinforce a price or output restraint.\\n\\n\\x0c\"","created_timestamp":"May 1, 2003","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/american-down-feather-section-home-fashion-products-association\/americandownletter031114.pdf"}
{"text":"b'EAGLE RIDGE 1\\nMarch 19, 2002\\n\\nMr. Neil Blickman\\nFederal Trade Commission\\n600 W. Pennsylvania Ave., N.W.\\nWashington, D.C. 20580\\n\\nPetition to Establish a New Generic Subclass\\nThe Dow Chemical Company (Dow), world headquartered in Midland, Michigan, hereby\\nsubmits this Petition to the Federal Trade Commission (FTC) for the establishment of a new\\ngeneric subclass (lastol) within the existing olefin category.\\nDow seeks to establish a generic subclass for its new crosslinked elastic fiber (CEF) for three\\nreasons:\\n1. Dow CEF fiber has the same general chemical composition as the FTC\\xe2\\x80\\x99s established olefin\\ngeneric fiber category:\\n- the fiber-forming substance in CEF is composed of at least 85 percent by weight of\\nethylene, propylene, or other olefin units.\\n- specifically, greater than 98 percent by weight of the fiber-forming substance in CEF\\nis composed of ethylene and other olefin units (e.g., 1-octene).\\n2. Dow CEF, while having the general chemical composition of olefin, has a unique chemistry,\\nmolecular design, and fiber structure which enables distinct, important properties to the\\nconsumer:\\n- the fiber is elastic with a wide temperature tolerance, enabling comfort stretch\\ngarments that can be repeatedly washed, dried, and ironed without loss of stretch and\\nelasticity\\n3. Dow CEF fiber\\xe2\\x80\\x99s distinctive elasticity and temperature tolerance features enable olefin to be\\nconsidered for new apparel applications beyond the conventional socks and thermal underwear:\\n- stretch cotton separates like dresses, shirts, and slacks, are now possible and desirable\\nfor their comfort stretch and easy-care properties\\n\\n1\\n\\n\\x0cIn short, Dow CEF is an atypical olefin fiber differing significantly \\xe2\\x80\\x93 in chemistry, process, and\\nproperties \\xe2\\x80\\x93 from conventional olefin fiber manufactured for apparel uses today per the FTC\\xe2\\x80\\x99s\\ndefinition. Dow CEF is not a rubber, per the FTC\\xe2\\x80\\x99s definition, because the fiber-forming\\nsubstance in Dow CEF is a polyolefin with low but significant crystallinity versus an amorphous\\n(non-crystalline) polyolefin. And last, Dow CEF is not a spandex, per the FTC\\xe2\\x80\\x99s definition,\\nbecause CEF is not made of polyurethane.\\nThe FTC definitions for olefin fiber1, rubber fiber2, and spandex fiber3 are listed below for\\nreference.\\n\\nOlefin. A manufactured fiber in which the fiber-forming substance is any long chain synthetic polymer composed\\nof at least 85 percent by weight of ethylene, propylene, or other olefin units, except amorphous (noncrystalline)\\npolyolefins qualifying under paragraph (j)(1) of this section.\\n1\\n\\nRubber. A manufactured fiber in which the fiber-forming substance is comprised of natural or synthetic rubber,\\nincluding the following categories:\\n\\n2\\n\\n(1) A manufactured fiber in which the fiber-forming substance is a hydrocarbon such as natural rubber,\\npolyisoprene, polybutadiene, copolymers of dienes and hydrocarbons, or amorphous (noncrystalline)\\npolyolefins.\\n(2) A manufactured fiber in which the fiber-forming substance is a copolymer of acrylonitrile and a diene\\n(such as butadiene) composed of not more than 50 percent but at least 10 percent by weight of acrylonitrile\\nunits.\\nThe term lastrile may be used as a generic description for fibers falling within this category.\\n(3) A manufactured fiber in which the fiber-forming substance is a polychloroprene or a copolymer of\\nchloroprene in which at least 35 percent by weight of the fiber-forming substance is composed of\\nchloroprene units.\\n(emphasis added)\\n3Spandex. A manufactured fiber in which the fiber-forming substance is a long chain synthetic polymer\\ncomprised of at least 85 percent of a segmented polyurethane.\\n\\n2\\n\\n\\x0cI\\n\\nDow Crosslinked Elastic Fiber (CEF): The Atypical Olefin Fiber\\nA. Properties of Dow CEF Versus Conventional Olefin\\n1.\\n\\nUnique Chemistry of Dow CEF\\n\\nDow CEF is the first manufactured olefin fiber founded on metallocene-based\\npolyolefin elastomer chemistry. Although the fiber-forming substance in Dow CEF\\nis made from olefin monomers, Dow CEF fiber has a unique molecular structure, a\\nunique morphology and unique properties when compared with any olefin fiber\\npreviously seen on the market. This unique combination of properties is a direct\\nresult of the polymerization chemistry, which includes the use of a constrained\\ngeometry catalyst, which is a member of the metallocene family.\\nThis catalyst has a single type of active site allowing precise control of molecular\\narchitecture of the polymer. Specifically, greater than 98 percent of the fiber forming\\nsubstance in Dow CEF is a homogeneously branched ethylene4 interpolymer5\\ncomposed of ethylene and other olefin comonomer units (typically octene).\\nVery technically, the polymer in Dow CEF contains short chain branching; has no\\nmeasurable high-density polymer fraction; has a narrow, essentially single peak in\\nTREF (temperature rising elution fractionation) and differential scanning calorimetry\\n(DSC) profile curve; and has a narrow molecular weight distribution prior to\\ncrosslinking. In simple terms, the molecules in Dow CEF are all very similar in size\\nand composition to each other. These molecular characteristics lead to important and\\ndistinct fiber properties.\\nThe alpha-olefin comonomer in Dow CEF is typically octene, and is present at a high\\nlevel (typically in excess of 30 weight percent). This high comonomer content leads to\\nDow CEF fiber\\xe2\\x80\\x99s low but significant level of crystallinity and low density.\\nIn contrast, olefin fiber manufactured today is based on conventional multi-site\\ncatalyst technology (such as Ziegler\/Natta catalysts). Consequently, it has a broad\\ncompositional molecular weight distribution and low or no comonomer content.\\n\\n4Homogeneously branched ethylene polymer. Refers to an ethylene interpolymer in which the comonomer is\\nrandomly distributed within a given polymer molecule and where substantially all of the polymer molecules have\\nthe same ethylene to comonomer molar ratios (WO 99\/60060) and are manufactured using so called\\nhomogeneous or single site catalyst systems known in the art as metallocene catalyst or constrained geometry\\ncatalysts system. (See also US 6,140,442, \\xe2\\x80\\x9cElastic Fibers, Fabrics and Articles Fabricated therefrom\\xe2\\x80\\x9d and US\\n6,194,532, \\xe2\\x80\\x9cElastic Fibers\\xe2\\x80\\x9d)\\n\\n5Interpolymer. Refers to polymers prepared by the polymerization of at least two different types of monomers,\\ntypically ethylene and octene.\\n\\n3\\n\\n\\x0c2.\\n\\nUnique Morphology of Dow CEF\\n\\nAs a result of its unique chemical structure, Dow CEF has lower crystallinity\\nthan conventional olefin fibers. (See Summary Table 1, page 15.) Specifically, the\\nhigh comonomer content leads to Dow CEF fiber\\xe2\\x80\\x99s low but significant level of\\ncrystallinity (12 \\xe2\\x80\\x93 16 weight percent) (Figure 1a, page 5) and low density (from 0.87\\nto 0.875 g\/cc). Unlike conventional olefin fiber where the polymer crystals are in\\nlamellae form, the crystals in the Dow CEF fiber-forming substance are in fringe\\nmicelle form. The fringed micellar crystalline morphology6 and the low but significant\\nlevel of crystallinity in Dow CEF imparts elastic properties not seen in other olefin\\nfiber manufactured today. This unique morphology of the Dow CEF polymer results\\nin high stretch (such that the fiber can be stretched to at least five times its original\\nlength before breaking) and high elasticity or snap back (such that when a fiber is\\nstretched to twice its length and then released, the fiber recovers to within 25% of its\\noriginal length).\\nIn contrast, conventional olefin fiber, such as drawn polypropylene fiber (Figure 1b,\\npage 5), is highly crystalline with degree of crystallinity greater than 50 percent and\\ndensity greater than 0.90 g\/cc. Additionally, conventional olefin has very low stretch\\n(for example, 33 percent elongation to break) and no significant elasticity at high\\nstretch.\\nThis combination of elasticity, elongation, and mechanical strength found in Dow\\nCEF fiber are not found in conventional olefin fiber manufactured today. (WO\\n99\/60060, US Patent allowed, but not yet issued.)\\n\\n6\\n\\nBenedikt, George M., Brian L. Good all (1998). Metallocene-C atalyzed P olymers: Ma terials,\\nPro perties, Processing & M arkets. Norwich, New York: Plastics Design Library, pp. 127-133.\\n\\n4\\n\\n\\x0cFigure 1: Differential scanning calorimetry (DSC) showing crystallinity and melting\\npeak temperature of Dow CEF fiber (a) versus conventional drawn polypropylene\\nfiber (b). Degree of crystallinity is determined from heat of fusion in the melting\\nendotherm.\\n\\nDow CEF (a)\\n\\nDrawn Polypropylene Fiber (b)\\n\\n\\x0c3. Unique Manufacturing Process of Dow CEF\\nDow CEF fibers are manufactured by melt spinning followed by crosslinking.\\nMelt spinning\\nThe Dow CEF fiber is fabricated using a melt spinning process. For instance, the\\npolymer may be melt spun into mono-filament or multi-filament fibers with a broad\\nrange of deniers (ranging from less than 20 to over 140 denier) on conventional\\nelastic melt spinning equipment, such as that used for thermoplastic urethane fibers.\\nIn one specific example, the fibers were separately melt spun on fiber extrusion\\nequipment consisting of an extruder, gear pump and spinneret. The extruder provided\\na melt temperature of 236\\xc2\\xb0C and each polymer melt stream was fed to the gear pump\\nwhich pressurized the melt and passed it through a 200 mesh pack followed by a 34\\nhole spinneret die. The spinneret had a 4:1 L\/D and the holes had a diameter of 800\\nmicrons. The resin output from the spinneret was controlled at 0.78 gram\/hole\/\\nminute. The fibers were quenched with a room temperature air high velocity blower.\\nCrosslinking\\nAfter spinning, the polymer chains in CEF fiber are not connected to one another\\nthrough covalent bonds. As a result, in an appropriate solvent, such as boiling xylene\\nor tri-chloro benzene, the polymer will dissolve. The fiber will also begin to flow and\\ndeform if heated above the crystalline melting point (about 68\\xc2\\xb0C). In order to prevent\\ndissolution and impart high-temperature dimensional stability, the fiber is crosslinked.\\nAfter the crosslinking process, the polymer chains in the fiber are linked to one\\nanother via covalent bonds (Figure 2, below). The crosslinked fiber is characterized as\\nhaving xylene extractables of less than about 70 weight percent as defined in\\naccordance with ASTM D-2765.\\nFigure 2: Schematic of morphology of crosslinked Dow CEF fiber (a) versus\\nuncrosslinked polymer (b).\\nDow CEF Fiber (a)\\n\\nUncrosslinked Fiber (b)\\n\\nCro sslinks and Crystals\\n\\nFringe-Miceller C rystals\\n\\n56\\n\\n\\x0cThe crosslinking process is conducted by any means capable of economically forming\\ncovalent links between the polymer chains including electron beam, beta irradiation,\\ngamma irradiation, corona radiation, peroxides, allyl compounds, silane compounds\\nand UV radiation with or without crosslinking catalysts. For example, crosslinking\\ncan be accomplished via high energy electron beam irradiation of the fiber spools.\\nThe irradiation source can be any electron beam generator operating in a range of 150\\nkilovolts to 12 megavolts with a power output capable of supplying the desired\\ndosage in megarads. The voltage can be adjusted to appropriate levels. The\\nirradiation is usually carried out at a dosage between 3 to 35 megarads. Irradiation\\nmay be carried out at room temperature or at a lower temperature, and is typically\\nconducted on the fiber spools after fiber spinning.\\n4.\\n\\nUnique Properties of Dow CEF\\n\\nDow CEF fibers have elasticity, high temperature stability, and chemical\\nresistance\\nElasticity\\nThe low but significant level of crystallinity imparts elasticity to the Dow CEF fiber\\nwhereas no olefin fiber manufactured today is elastic. Elasticity is defined as the\\nability of a strained material to recover its original size and shape, immediately after\\nremoval of the stress that causes deformation7. DOW CEF fiber\\xe2\\x80\\x99s favorable stretch\\n(at least five times its original length before breaking) and elasticity or snap back\\n(stretching to twice its length then, when released, recovering to within 25 percent of\\nits original length) are a consequence of its low but significant level of crystallinity\\n(Figure 3, page 8). Because of this, CEF can be successfully used in clothing\\napplications where stretch is desired.\\nIn contrast, conventional olefin fiber is highly crystalline, with degrees of crystallinity\\nof greater than 50 percent. The crystals of conventional olefin fiber are also in\\nlamellae form, unlike crystals in the Dow CEF fiber-forming substance which are in a\\nfringe micelle form. As a result, conventional olefin fiber is stiff, and essentially,\\nnon-elastic. Typical olefin fibers (in their manufactured, \\xe2\\x80\\x9cdrawn,\\xe2\\x80\\x9d form) exhibit very\\nlow elongation before breaking (typically less than 50%) and therefore cannot be\\nsuccessfully used in today\\xe2\\x80\\x99s apparel markets for stretch clothing.\\n\\n7 Ko Sa C omm unicatio ns and Pub lic Affairs (1 999 ). Dictionary of Fiber & Textile Technology.\\nCharlotte, N.C.: KoSa, p. 69.\\n\\n7\\n\\n\\x0cFigure 3: Tensile data of Dow CEF fiber (a) versus drawn polypropylene fiber (b).\\n\\nFigure 4: Dynamic mechanical thermal analysis (DMTA) of Dow CEF (a) versus\\ndrawn polypropylene fiber (b). Note: Dow CEF maintains its mechanical integrity\\nwell above its crystalline melting point (ca. > 68\\xc2\\xb0C), whereas drawn polypropylene\\ndoes not.\\n\\n8\\n\\n\\x0cHigh temperature stability, chemical resistance\\nDow CEF is substantially crosslinked with covalent crosslinks that connect adjacent\\npolymer chains into a contiguous 3-dimensional polymer network (Figure 2a, page 6).\\nThis crosslinked polymer network structure allows Dow CEF to maintain its shape\\nand mechanical integrity above its crystalline melting temperature. Above its melting\\ntemperature, the mechanical integrity of Dow CEF is provided by covalent crosslinks.\\nIn fact, Dow CEF retains its shape at temperatures up to 220\\xc2\\xb0C \\xe2\\x80\\x93 well in excess of\\nconventional olefin\\xe2\\x80\\x99s melting point which occurs at or below 170\\xc2\\xb0C (Figure 4, page 8; Figure 7, page\\n10). Furthermore, Figure 5, below, shows the heat stability of Dow CEF in nitrogen up to about 350\\xc2\\xb0C\\n(> 220\\xc2\\xb0C).\\nThis crosslinked polymer network structure also allows Dow CEF to maintain its integrity in solvents\\nwhich typically dissolve the starting polymer (Figure 7, page10). In contrast, conventional olefin fiber is\\nnot crosslinked and therefore loses shape and mechanical integrity and\/or dissolves above its crystalline\\nmelting temperatures which range up to about 170\\xc2\\xb0C.\\nFigure 5: DSC melting curve in nitrogen of Dow CEF from room temperature\\nto 500\\xc2\\xb0C.\\n\\nFurthermore, Figure 5, above, shows the heat stability of Dow CEF in nitrogen up to about 350\\xc2\\xb0C.\\n\\n9\\n\\n\\x0cFigure 6: Photographs showing mechanical integrity of Dow CEF (a)\\nversus conventional olefin fiber (b) which loses shape and integrity at 170\\xc2\\xb0C.\\nDow CEF\\n\\nConventional Olefin Fiber\\n\\na1\\n\\nb1\\n\\n25\\xc2\\xbaC, CEF\\n\\n25\\xc2\\xbaC, Drawn PP\\n\\na2\\n\\nb2\\n\\n170\\xc2\\xbaC, Drawn PP\\n\\n220\\xc2\\xbaC, CEF\\n\\nFigure 7: Photographs showing uncrosslinked fiber (a) which has dissolved in TCB after heating to\\n150\\xc2\\xb0C and crosslinked Dow CEF fiber (b) which continues to maintain its shape and structural\\nintegrity under same conditions. Note: you can see the Dow CEF fiber still present in the TCB\\nsolvent.\\n\\nCrosslinked fiber\\nafter heating in\\nTCB 150\\xc2\\xb0C\/2 hours\\n\\nUncrosslinked fiber\\n\\nafter heating in TCB\\n150\\xc2\\xb0C\/2 hours\\n(7a)\\n\\n(7b)\\n10\\n\\n\\x0cDow CEF fiber\\xe2\\x80\\x99s ability to withstand high temperatures has compelling advantages for the textile\\nmanufacturer: they can use more efficient dye and process methods requiring temperatures in excess of\\n170\\xc2\\xb0C. There are also advantages for consumers: they can repeatedly wash, dry; and iron fabrics\\ncontaining CEF at typical temperatures (up to 210\\xc2\\xb0C) without destroying the stretch properties of CEF\\nfiber. In contrast, since conventional olefin fiber manufactured today loses its shape and mechanical\\nintegrity in temperatures ranging from 105 \\xe2\\x80\\x93 170\\xc2\\xb0C, it cannot withstand the rigors of high heat and\\nrepeated launderings. Consequently, conventional olefin fiber is not widely used in apparel applications\\ntoday where the consumer seeks easy wash \\xe2\\x80\\x98n\\xe2\\x80\\x99 wear care.\\nTherefore, Dow CEF fiber is a uniquely differentiated olefin fiber and exhibits significant property\\nimprovements including shape retention and stability at very high temperatures plus improved fabric\\nprocessing and consumer care characteristics not found in conventional olefin fiber manufactured\\ntoday.\\n\\nB. Properties of Dow CEF Versus Rubber Fibers\\n1.\\n\\nDifferences in Chemistry and Morphology\\n\\nDow CEF fiber differs significantly from rubber fibers. The fiber-forming substance in Dow CEF\\nis a polyolefin having a low but significant level of crystallinity. Therefore, Dow CEF does not fall\\nwithin the FTC definition of a rubber (FTC definition of rubber, page 2).\\nEvidence of low but significant crystallinity in Dow CEF fiber is provided by a standard differential\\nscanning calorimetry (DSC) technique (Figure 8, page 12).\\nCEF fiber exhibits approximately 16% crystallinity and a melting point of approximately 68\\xc2\\xb0C. In\\nmarked contrast, the rubber fiber exhibits no crystallinity as indicated by lack of a discernible DSC\\nendotherm.\\n\\n11\\n\\n\\x0cFigure 8: Differential scanning calorimetry of Dow CEF (a) versus rubber (b). Degree of\\ncrystallinity is determined from heat of fusion in melting endotherm.\\nDow CEF (a)\\n\\nRubber Fiber (b)\\n\\n12\\n\\n\\x0c2. Process Distinctions\\nDow CEF fiber is produced by a melt spinning \/ crosslinking process. In contrast, rubber fibers are\\ncommonly made by extruding a pre-cured aqueous latex dispersion into an acid bath. This extrudate is\\ncoagulated to solidify the rubber. The resulting thread then proceeds into a drying and a curing oven.\\nAlternatively, rubber fibers can be made by slitting prevulcanized sheets (cut rubber).\\nTherefore, CEF and rubber fibers are manufactured from radically different materials via different\\nprocesses.\\n3.\\n\\nProperty Differentiation\\n\\nRubber fibers are not crystalline, whereas CEF fibers have a low but significant level of\\ncrystallinity. As a result, CEF fibers have unique differentiating properties.\\nRubber fibers are amorphous (non-crystalline) polymers, and are vulcanized typically using sulfur and\\nheat. As a result of this chemical structure, rubber fibers have uniform tensile properties across a broad\\ntemperature range. In contrast, CEF fibers have mechanical properties which derive from both the\\ncrystallinity and covalent crosslinks between carbon atoms \\xe2\\x80\\x93 without using sulfur. At low\\ntemperature, the presence of crystallites dominates the mechanical properties of CEF. As the\\ntemperature is raised above the crystalline melting point (ca. > 68\\xc2\\xb0C), the modulus of CEF fibers drops\\nby an order of magnitude; the modulus above melting point is determined solely by the degree of\\ncovalent crosslinks. Therefore, CEF has unique temperature-dependent mechanical properties which\\nare radically different from those of rubber fibers. Since rubber has absolutely no crystallinity, the\\nmodulus is\\nessentially flat with respect to temperature increases. The figure shown below (Figure 9) dramatically\\ndemonstrates this feature.\\nFigure 9: Dynamic mechanical thermal analysis (DMTA) of Dow CEF (a) versus rubber fiber (b).\\n\\n13\\n\\n\\x0cSecondly, since CEF has a low but significant level of crystallinity at room temperature, the fiber\\nexhibits higher tenacity (strength) at break compared to rubber fiber which is amorphous (Figure 10,\\nbelow). The improved mechanical strength and toughness of Dow CEF is important to survive\\nrigorous textile fabrication processes.\\n\\nFigure 10: Tensile data of Dow CEF fiber (a) versus rubber fiber (b) showing lower tenacity at break\\nof rubber fiber due to rubber\\xe2\\x80\\x99s amorphous character.\\n\\nAnd last, since Dow CEF has a low but significant level of crystallinity at room temperature, CEF\\nexhibits higher tensile set (lower elastic recovery) than rubber when extended to greater than 100%\\nelongation. The 5-cycle tensile set measurement (Figure 11, page 15) shows this contrasting behavior\\nbetween CEF and rubber fiber. The permanent set of CEF is a direct manifestation of its crystallinity\\nand stands in marked contrast to the low tensile set of rubber fibers.\\n\\n14\\n\\n\\x0cFigure 11: Tensile set data of Dow CEF (a) versus rubber (b) showing permanent set of Dow CEF\\nversus negligible set of rubber fiber (5 cycle elongation).\\n\\nSummary Table #1\\nProperty\\n\\nCEF\\n\\nConventional\\nOlefin 8\\n\\nRubber\\n\\nCrystallinity, wt%\\n\\n12 to 16\\n\\n> 50\\n\\n0\\n\\nElongation, %\\n\\n> 400\\n\\n< 15-200\\n\\n600 \\xe2\\x80\\x93 800\\n\\nBreaking Strength\\n(gm\/den)\\n\\n> 0.9\\n\\n1.7 \\xe2\\x80\\x93 6.8\\n\\n0.45\\n\\nInitial Modulus\\n\\n0.3\\n\\n34 \\xe2\\x80\\x93 56\\n\\n0.02\\n\\nDensity (gm\/cc)\\n\\n0.87 \\xe2\\x80\\x93 0.875\\n\\n0.90 \\xe2\\x80\\x93 0.91\\n\\n~ 1.0\\n\\nDissolution\\nCharacteristics\\nTemperature\\nStability\\n\\nDoes not dissolve\\n\\nDissolve\\n\\nDoes not dissolve\\n\\nUp to > 220\\xc2\\xb0C\\n\\nUp to 170\\xc2\\xb0C\\n\\nUp to 350\\xc2\\xb0C\\n\\nManufacturing\\nMethod\\n\\nMelt spinning\\nfollowed by\\ncrosslinking\\n\\nMelt spinning\\n\\nExtrusion\/vulcanization or\\nsplitting prevulcanized\\nsheets\\n\\n8\\n\\nPolypropylene drawn fiber data (elongation, breaking strength, initial modulus) from Fourne, Franz (1998). Synthetic Fibers:\\nMachines and Equipment, Manufacture, Properties. Cincinnati, Ohio: Hanser\/Gardner Publications, Inc. pp. 840 & 850.\\n\\n15\\n\\n\\x0cII\\n\\nDow CEF: A New Generic Subclass \\xe2\\x80\\x94 Lastol\\nA. Why Dow Seeks a New Generic Subclass\\nDow CEF meets the broad definition of olefin fiber. However, CEF has unique elastic properties,\\nthermal resistance, molecular structure, morphology, and property improvements which differentiate it\\nfrom conventional olefin fiber manufactured today. Today\\xe2\\x80\\x99s olefin \\xe2\\x80\\x93 largely seen in carpet, thermal\\nunderwear, and socks \\xe2\\x80\\x93 does not offer the consumer stretch or the easy-care characteristics gained\\nthrough high temperature tolerance. To textile mill producers, CEF enables process economies and the\\nproduction of new products with atypical stretch and performance properties. To the consumer, CEF\\noffers a wider choice in garments containing stretch fabric plus the benefit of easy-care laundering at\\nhigher temperatures without degradation of the stretch fiber.\\nB. Proposed New Generic Subclass Name \\xe2\\x80\\x93 Lastol\\nDow recognizes that a new subclass name should capture the chemical structure while also\\nreferencing the radical distinction. Dow has determined Lastol to be the descriptive new subclass\\nbecause it connotes an elasticized olefin. Dow proposed the following definition for Lastol:\\nA manufactured crosslinked elastic fiber in which a) the fiber-forming substance is a synthetic\\npolymer, with low but significant crystallinity, composed of at least 99 percent by weight of ethylene\\nand at least one other olefin unit, and b) wherein the fiber exhibits substantial elasticity and heat\\nresistance properties not present in traditional olefin fibers.\\n\\nIII\\n\\nCommercialization Plan and Time Table\\nCommercialization of Dow CEF is imminent \\xe2\\x80\\x93 occurring early in the second quarter of 2002.\\nBeginning in 1999, Dow identified and began working with developmental partners who are leaders in\\nthe fiber manufacturing and apparel industry around the world. Since the second quarter of 2001, CEF\\nhas been successfully made on commercial-scale spinning equipment, with resulting quantities\\nsubsequently produced and used in a wide range of fabrics including both knits and wovens. These\\nfabrics have been used to make a variety of goods, but most notably for those in the apparel market and\\nits various end-use segments.\\nGarments made with CEF have been tested and found to meet or exceed all standard industry\\nspecifications. The market testing process of garments with leading retailers is presently underway,\\nwith completion expected within the coming weeks.\\n\\n16\\n\\n\\x0cIf you have questions regarding this Petition, please contact Margaret Rogers in Dow\\xe2\\x80\\x99s Washington\\nD.C. office (202 429-3403) Stephen Krupp, our business attorney (979 238-2889). Steve is located in\\nFreeport, Texas.\\nThank you for your time and consideration.\\nSincerely,\\n\\nAntonio Torres\\nGlobal Business Director\\nDow Fiber Solutions\\nCc: Stephen Krupp\\nMargaret Rogers\\n\\n17\\n\\n\\x0c'","created_timestamp":"March 19, 2002","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/new-generic-fiber-petition-dow-chemical-company\/petition_dowsubclass.pdf"}
{"text":"b'UNITED STATES OF AMERICA\\n\\n.\\n\\n.~.~\\n\\nFEDERAL TRADE COMMISSION\\n~\\n\\n~\".\\n\\n600 PENNSYLVANIA\\n\\n.\"\\n\\nA VENUE, NW\\n\\nWASHINGTON,DC 20580\\n\\nDivision of Enforcement\\nBureau of Consumer Protection\\n\\nMarch\\n\\n18,\\n\\n2002\\n\\nMr. Carlos Moore\\nExecutive Vice President\\nAmerican Textile Manufacturers Institute\\n1130 Connecticut Ave., NW, Suite 1200\\nWashington, DC 20036-3954\\nRe: ReQuestfor FTC Staff QRinion concerning Thread Count\\nDear Mr. Moore:\\nThis is in reply to your letter requesting a Commission staff opinion regarding the\\nappropriate method for determining fabric \"thread count,\" or yams per square inch, in textile\\nproducts such as bed sheetsand pillow cases. You state that some companies are marketing\\nbedding products with extremely high yam or thread counts, achieved by counting yams within a\\nply as individual yams, thus dramatically and deceptively increasing the number of yams in a\\nsquare inch of fabric. You make specific reference to the American Society for Testing and\\nMaterials (ASTM) test method D 3775, titled \"Standard Test Method for Fabric Count of Woven\\nFabric,\" and you express the view that this method is the long-accepted industry standard for\\ndetermining thread count.\\nUnder the Commission\\'s Rules of Practice, 16 C.F.R. \\xe0\\xb8\\xa2\\xe0\\xb8\\x87 1.I(a), the Commission (and,\\nunder delegated authority, its staff) may render an advisory opinion with respectto a prospective\\ncburse of conduct proposed by the requesting party:\\n\\xe0\\xb8\\xa2\\xe0\\xb8\\x87 1.1 Policy.\\n(a) Any person, partnership, or corporation may requestadvice\\nfrom the Commission with respectto a course of action which the\\nrequesting party proposes to pursue.\\nIn this instance, A TMI is not seeking advice with respectto a course of conduct it proposes to\\npursue. Rather, A TMI is seeking an opinion as to whether certain representationsmade by some\\nindustry members with regard to thread count might be considered deceptive under the FTC Act.\\nAs such, the question is not appropriate for issuanceof a staff advisory opinion.\\n\\n\\x0cMr. Carlos Moore\\npage 2\\n\\n,\\nAlthough we are unable to provide you with a staff advisory opinion about whether\\ncounting yarns within a ply as individual yarns would be deceptive, we can advise you as to how\\nthe Commission staff generally would analyze such claims. A thread count claim, like other\\nobjective, material claims about a product, must be supported by a \"reasonablebasis.\" In\\ndetermining what constitutes a reasonablebasis for claims, we would consider what experts in\\nthe field believe is appropriate, including whether there are relevant consensusbased test\\nprocedures, such as an ASTM test procedure, or other widely acceptedindustry practices that\\napply to the matter. If so, we would give suchprocedures or practices great weight in\\ndetermining whether:the advertiserhas met its substantiationburden. In other related contexts,\\nthe Commission has encouragedthe use of ASTM tests. SeePressRelease,FTC Announces\\nActions on Wool Labeling Rules, dated March 8, 1994 (copy attached)(\"In its clarification of the\\nprocedure used for testing the fiber content of wool products, the FTC said the industry members\\nshould, where possible, use procedures established by the American Society for Testing and\\nMaterials (ASTM).\")\\nI also wish to bring to your attention a closing letter that is on the public record\\n.concerning\\nan investigation of possibly deceptive practices in connection with the packaging of\\ndown comforters. In that instance, the staff determined that no further Commission action was\\nwarranted when the company notified the staff that it was changing its package product\\ndescription from \"760 White Goose Down\" to \"finely woven 380 2-ply fabric.\" (copy attached).\\nPursuant to Section 1.4 of the Commission\\'s Rules of Practice and Procedure, 16 C.F.R.\\n\\xe0\\xb8\\xa2\\xe0\\xb8\\x87 1.4, your letter, together with this response,will be placed on the public record.\\nI hope you will find the above information helpful.\\nSincerely yours,\\n\\n~U.L~\\n\\nl> .Ntl<:.-<..4;\\n\\nElaine D. Kolish\\nAssociate Director for Enforcement\\n\\nEnclosures\\n\\n\\x0c-\\n\\nFederalTrade Commission Washington, D.C. 20580\\n~\\nIMMEDIATERRT.RASE:March 8. 1984\\nFIt= A~ES\\n(If\\n\\nM)()L\\n\\nACr I (2fS\\n\\nt-A\"RI~ 1M; BOLES\\n\\nThe Federal\\nTrade Commission has decided,\\nafter\\nreviewing\\npublic\\ncomments,\\nnot to change its rule requiring\\na label\\nstating\\nthe minimum wool content\\non wool products.\\nThe Commission also\\nissued a clarification\\nof the procedures\\nit uses for testing\\nwool\\nproducts\\nto determine\\ntheir\\nfiber\\ncontent.\\nThe FTC enforces\\nwool-labeling\\nrules\\nunder the Wool Products\\nLabeling\\nAct.\\nIn April\\n1983, the FTC sought comments on whether\\nit should\\namend its\\nrules\\nto allow labels\\nto disclose\\nthe average amount,\\nrather\\nthan the minimum amount, of wool in fabrics\\nthat contain\\nrecycled\\nwool or wool blend products.\\nUsing the average amount\\nmight provide\\nconsumers more accurate\\ninformation,\\nthe FTC said,\\nbut using the minimum assures\\nthat conswners will\\nreceive\\nat\\nleast\\nthe amount of wool on the label.\\nHowever,\\nafter\\nreviewing\\nthe comments, the Commission\\ndecided\\nnot to amend the rule,\\nbecause there was no evidence\\nthe record\\nto support\\nthe change.\\n\\non\\n\\nIn its clarification\\nof the procedure\\nused for testing\\nthe\\nfiber\\ncontent\\nof wool products,\\nthe FTC said the industry\\nmembers\\nshould,\\nwhere possible,\\nuse procedures\\nestablished\\nby the\\nAmerican\\nSociety\\nfor Testing\\nand Materials\\n(ASTM).\\nThe test should be made on an \"oven-dry\\nbasis,\"\\n\"commercial\\nmoisture\\nregain\"\\nadded to determine\\nthe\\nfiber\\ncontent\\nof a wool product.\\n\\nwith\\nquantitive\\n\\nThe ASTM defines\\noven-dry\\nbasis as \"the condition\\nof a\\nmaterial\\nthat has been heated under prescribed\\nconditions\\nof\\ntemperature\\nand humidity\\nuntil\\nthere\\nis no further\\nsignificant\\nchange in its mass.\"\\nCommercial\\nmoisture\\nregain is \"an arbitrary\\nvalue\\nto be used with the oven-dry\\nweight\"\\nwhen calculating\\n\"the\\nweight\\n\\n\".of a specific\\n\\ncomponent\\n\\nin\\n\\nthe\\n\\nanalysis\\n\\nof\\n\\nfiber\\n\\nblends.\"\\n\\nCopies of the Federal\\nRegister\\nnotice\\non the minimum wool\\ncontent\\nrulemaking\\ndecision\\nare available\\nfrom the FTC\\'s Public\\nReference\\nBranch,\\nRoam 130, 6th st. and Pennsylvania\\nAve. N.W.,\\nWashington,\\nD.C. 20580; 202-523-3598;\\nTTY 202-523-3638.\\nNews\\nmedia copies\\nare available\\nfrom the Office\\nof Public\\nAffairs,\\nRoom 496, same address;\\n202-523-1892.\\n# # #\\n\\nMEDIA CONTACT:\\n\\nSusan Ticknor,\\n\\nOffice\\n\\nof Public\\n\\nAffairs,\\n\\n202-523-1892\\n\\nSTAFF-CONTACT:\\n\\nJerry\\n\\nMcDonald,\\n\\nBureau\\n\\nof Conswner\\n\\n202-376-2800\\n\\n(labels)\\n\\nEarl Johnson,\\n202-376-2891\\n\\nBureau of Conswner\\n(test\\nmethods)\\n\\nProtection,\\n\\nProtection,\\n\\n\\x0c.\" \\'IC\\n\\n.\\n\\n.~\\n\"\".\\nDivision\\n\\nUNITED STATESOF AMERICA\\n\\nj\\'~~\\n\\nFEDERAL TRADE COMMISSION\\n\\n~\\n.\\'1:-\\n\\nWASHINGTON, D.C. 20580\\n\\nof Enforcement\\n\\nBureau of Consumer Protection\\n\\nApril\\n\\n8, 1996\\n\\nJeffrey\\nGoldman, President\\nCalifornia\\nFeather & Down Corporation\\n11842 S. Alameda St.\\nLynwood, CA 90262\\nRe:\\n\\nCalifornia\\n\\nFeather\\n\\n& Down Corporation,\\n\\n9523373\\n\\nDear Mr. Goldman:\\nThe Commission has conducted an investigation\\ninvolving\\nyour\\ncompany\\'s possible\\nviolation\\nof the Federal Trade Commission Act\\nthrough the use of unfair\\nacts or deceptive\\nacts or practices\\nin\\nconnection\\nwith the packaging of down comforters.\\nBy letter\\ndated March 12, 1996, Mr. N. Frank Wiggins stated\\nthat your company is removing the reference\\nto \"760\" from the\\npackaging and labeling\\nof your \"White Knights\\n760 White Goose\\nDown Comforter.\"\\nFurther,\\nMr. Wiggins\\'\\nAugust 12, 1995, letter\\nstated that the company had revised\\nthe text of the packaging for\\nthis product\\nto say that the White Knights 760 White Goose Down\\nComforter\\ncontains\\n\"finely\\nwoven 380 2-ply fabric.\\n...\"\\nThe\\nformer packaging had stated\\n\"finely\\nwoven 760 threads per sq.\\n.\\n\"\\nlnc h Upon further\\nreview of this matter,\\nit now appears that no\\nfurther\\naction\\nis warranted\\nby the Commission at this time.\\nAccordingly,\\nthe investigation\\nhas been closed.\\nThis action is\\nnot to be construed\\nas a determination\\nthat a violation\\nhas not\\noccurred,\\njust as the pendency of an investigation\\nshould not be\\nconstrued\\nas a determination\\nthat a violation\\nhas occurred.\\nThe\\nCommission reserves\\nthe right\\nto take such further\\naction as the\\npublic\\ninterest\\nmay require.\\nSincerely,\\nC---l.La..l-l\\'&... ~ ~~1C_{-<...a-\\\\\"\\nElaine D. Kolish\\nAssociate\\nDirector\\ncc:\\n\\nN. Frank Wiggins,\\nEsq.\\nVenable, Baetjer,\\nHoward & Civiletti,\\n1201 New York Avenue, NW, Suite 1000\\nWashington,\\nDC 20005-3917\\n\\nLLP\\n\\n\\x0cFEDERAL\\nTRA.DE\\nCOMMISSION\\n\\n~\\n\\nA\\nAMERICAN\\nMANUFACTURERS\\n\\n_t)IVISION ENFORCEMENT\\nTEXTILE\\nINSTITUTE\\n\\nJanuary 31, 2002\\n\\nMr. Steve Ecklund\\nFederal Trade Commission\\nDivision of Enforcement\\nWashington, DC 20580\\n\\nRe:\\n\\nRequest for FTC Staff\\nOpinion on Yarn Count\\n\\nDear Mr. Ecklund:\\nIt has come to our attention again that. some companies are marketing bed\\nsheets and pillowcases to U.S. consumers where extremely high yarn or thread\\ncounts are claimed -some as high as 1000 count. We believe these products\\nare mislabeled, creating deceptive information for the consumer.\\nLabeling these products based on a count that includes each ply in plied yarns\\ndeceives the customer into believing that bedding products with higher counts\\nare better when, in fact, they might be inferior because of the method used to\\ndetermine the count. We wrote to the Commission regarding this same issue on\\nFebruary 24, 1997 (copy enclosed) and provided a fabric sample and\\nindependent lab report verifying our position.\\nIn many cases, these extremely high counts are achieved by counting yams\\nwithin a ply as individual yams, thus dramatically increasing the number of yarns\\nin a square inch of fabric. A plied yarn is one in which two or more yarns are\\ntwisted together to form a single strand.\\nATMI believes this method of labeling products based on counting each\\nindividual yarn in plies to be a deceptive practice, which misleads the American\\n\\n.\\n\\n1130 Connecticut Ave., NW. Suite 1200. Washington, DC 20036-3954\\n202-862-0500 .fax: 202-862-0570. http:\/\/www.atmi.org\\nfax on demand: 202-862-0572\\n\\n\\x0c-\\n\\n,\\n\\npublic into making decisions to purchase items, based on false and misleading\\ninformation.\\nASTM method D 3775-96 (Standard Test Method for Fabric Count of Woven\\nFabric) is the long-accepted industry standard for determining count. This\\nmethod has been in use in this country for many years and serves as the\\nindustry\\'s standard way to report the count of many woven textile fabrics,\\nincluding sheeting. It is based on the number of yarns in the warp direction and\\nfilling direction, regardless of ply, and has become an important parameter used\\nby consumers to judge the quality of sheeting products, since the higher the\\ncount, the more luxurious the product.\\nATMI believes that any information provided to the consumer should be true and\\ncorrect so as not to be deceptive or mis-leading. We believe that plied yarns are\\nproperly counted as only one yarn. For example, a fabric containing 250\\nindividual four ply yarns in a square inch would be described as a \"250 thread\\ncount fabric, even though each thread or yarn contained four plies twisted\\ntogether.\" It would be false and mis-leading to describe this as a 1000 thread\\ncount product.\\nATMI requests a staff opinion from the Federal Trade Commission on this issue.\\nWe believe that manufacturers, importers and retailers of bed sheets should rely\\non the ASTM D3775-96 standard test method to determine count.\\n\\na:;;el#\\n\\n~\\n\\nCarlos Moore\\nExecutive Vice President\\n\\nEnclosure\\n\\n\\x0c'","created_timestamp":"March 8, 1994","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/american-textile-manufacturers-institute\/americantextilemanuinstitute.pdf"}
{"text":"b'UNITED STATES OF AMERICA\\n\\nFEDERAL TRADE COMMISSION\\nWASHINGTON, D.C. 20580\\n\\n \\n\\nDivision of Enforcement\\nBureau of Consumer Protection\\n\\n\\xe2\\x80\\x98August 6, 1999\\n\\nSteven S. Weiser\\n\\nAri L. Kaplan\\n\\nGraham & James, LLP\\n\\n885 Third Avenue\\n\\n21\" Floor\\n\\nNew York, NY 10022-4834\\n\\nDear Mr. Weiser and Mr. Kaplan:\\n\\nThis is in reply to your letter requesting a written advisory opinion regarding fiber content\\nlabeling of certain T-shirts, sweatshirts, sweatpants, and sweatshorts imported from Mexico. You\\n_ also request a second opinion on the exclusion from labeling of certain disposable knit wipe cloths\\nalso imported from Mexico.\\n\\n_ Based on your letter, and information that you provided over the telephone, it is my\\nunderstanding that your client plans to import from Mexico into the United States various odd\\nlots of textile fabrics composed of unknown percentages of cotton and polyester. Your client will\\nalso acquire various discarded textile panels of U.S. origin fabric, composed of unknown\\npercentages of cotton and polyester fibers. These imported odd lots.and domestic panels will then\\nbe shipped into Mexico where they will be cut and sewn to make T-shirts, sweatshirts,\\nsweatpants, and sweatshorts. Each such garment would be completely unique in terms of its fiber\\ncontent. The finished garments will then be shipped into the United States for retail distribution\\nand sale.\\n\\n\\xe2\\x80\\x98\\n\\nB d 01 licable and tion:\\n\\nBefore addressing your specific concern, let me provide some background information.\\nAs you note in your letter, according to Textile Rule 14(a) and (b) (16 C.F.R. \\xc2\\xa7 303.14(a) and\\n(b)), textile fiber products made in whole or in part from miscellaneous scraps, Tags, odd lots, or\\ntextile waste materials of undeterminable fiber content, may be labeled in various ways. Textile\\nRule 14(a) sets forth the following examples for labeling:\\n\\x0c_ Made of miscellaneous scraps of undetermined fiber content.\\n100% unknown fibers \\xe2\\x80\\x94 rags.\\nAll undetermined fibers \\xe2\\x80\\x94 textile by-products.\\n100% miscellaneous odd lots of undetermined fiber content.\\nSecondhand materials \\xe2\\x80\\x94 fiber content unknown.\\n\\nMade of unknown fibers \\xe2\\x80\\x94 waste materials.\\n\\nIt is staff\\'s opinion that the above examples are intended to apply to situations where the types of\\nfibers, such as cotton or polyester, are unknown, and where the percentages are likewise, of\\ncourse, unknown. Textile Rule 14(b) addresses situations in which some of the fibers are of\\nknown type and percentage, and other fibers in the same product are of unknown type and\\npercentage. The situation that you describe involves known fibers, but of unknown percentages.\\nIt appears that neither Textile Rule 14(a) nor 14(b) precisely fit the circumstances posed in your\\nletter. Although the Textile Rules do not exactly correspond to your situation, we find Wool Rule\\n\\n_ 29, under the Wool Products Labeling Act, may by analogy be used as guidance. Wool Rule 29\\n(16 C.F.R. \\xc2\\xa7 300.29) sets forth several examples that are helpful. Because the Rule is rather\\nlengthy, I will point out only the sample disclosures contained in the Rule:\\n\\nMade of Miscellaneous Cloth Scraps\\nComposed Chiefly of Cotton With Minimum of - -- % Recycled Wool.\\n\\nMade of Miscellaneous Cloth Scraps\\nComposed Chiefly of Rayon With Minimum of - \\xe2\\x80\\x94 % Recycled Wool.\\n\\nMade of Miscellaneous Cloth Scraps\\nComposed Chiefly of Cotton and Rayon With Minimum of - \\xe2\\x80\\x94 % Recycled Wool. .\\n\\nMade of Miscellaneous Cloth Scraps\\nContaining Cotton, Rayon and Other Non-Woolen Fibers,\\nWith Minimum of \\xe2\\x80\\x94 \\xe2\\x80\\x94 % Recycled Wool.\\n\\nAnalysis\\n\\nBased on the information you have provided, it is our understanding that the garments in\\nquestion are made from odd lots and discarded panels, some composed only of cotton, and others\\nof cotton and polyester, and that the percentages of cotton and polyester are unknown and, for\\npractical purposes, undeterminable. It is also our understanding that the odd lots and discarded\\npanels are not from used or secondhand textile products. Staff notes that the above examples use\\ndescriptive terms such as \\xe2\\x80\\x9cMiscellaneous Cloth Scraps,\\xe2\\x80\\x9d and \\xe2\\x80\\x9cwaste materials,\\xe2\\x80\\x9d and \\xe2\\x80\\x9c textile\\n\\nproducts\\xe2\\x80\\x9d and \\xe2\\x80\\x9cmiscellaneous odd lots.\\xe2\\x80\\x9d To remain consistent with Textile Rule 303.14 and\\nWool Rule 300.29, staff feels that it is appropriate that some such equivalent descriptive term(s)\\n\\x0cbe used on the labels of the garments at issue. Staff suggests the following fiber content\\ndisclosures: \\xe2\\x80\\x9cMade of scraps and odd lots of unknown percentages of cotton and polyester\\nfibers,\\xe2\\x80\\x9d or \\xe2\\x80\\x9cComposed of cotton and polyester scraps of unknown percentages.\\xe2\\x80\\x9d\\n\\nYou also requested an opinion on the fiber content labeling of certain disposable knit wipe\\ncloths (i.e., rags) which your client proposes to import from Mexico in either one thousand\\n(1,000) pound bundles or in cardboard boxes containing cloths weighing from 10 to 100 pounds.\\nThese items are made of knitted fabric (not woven fabric) and are of a disposable nature intended\\nfor one-time use only. You state that it is your position that this merchandise is excluded from\\nlabeling under 16 C.F.R. \\xc2\\xa7 303.45(a)(6), which provides for the exclusion of \\xe2\\x80\\x9cnon-woven\\nproducts of a disposable nature intended for one-time use only\\xe2\\x80\\x9d from the labeling requirements\\nunder the Textile Fiber Products Identification Act. Because the rags are made of knitted fabric\\nand, hence, \\xe2\\x80\\x9cnon-woven,\\xe2\\x80\\x9d and they are \\xe2\\x80\\x9cof a disposable nature intended for one-time use only,\\xe2\\x80\\x9d\\nstaff concurs that such rags are exempt from the labeling requirements of the Textile Act. I would\\nalso point out that on page 7 of our business guide book, Threading Your Way Through the\\nLabeling Requirements Under the Textile and Wool Acts (copy enclosed), \\xe2\\x80\\x9cindustrial wiping\\ncloths\\xe2\\x80\\x9d are listed as exempt from the Textile Act.\\n\\nIn accordance with Section 1.3(c) of the Commission\\'s Rules of Practice and Procedure\\n(16 C.F.R. \\xc2\\xa7 1.3(c)), this is a staff opinion only and has not been reviewed or approved by the\\nCommission or by any individual Commissioner, and is given without prejudice to the right of the\\nCommission later to rescind the advice and, where appropriate, to commence an enforcement\\naction.\\n\\nIn accordance with Section 1.4 of the Commission\\'s Rules of Practice and Procedure (16\\nCFR. \\xc2\\xa7 1.4), your request for advice, along with this response, will be placed on the public\\nrecord.\\n\\nT hope this has been helpful. If you have any questions do not hesitate to write to me or\\n\\ncall me at 202-326-2841.\\nSi ,\\nSea. Htc\\n\\nSteve Ecklund\\nFederal Trade Investigator\\n\\nEnclosure\\n\\x0c'","created_timestamp":"August 6, 1999","downloaded_timestamp":"10-18-2021","url":"https:\/\/www.ftc.gov\/sites\/default\/files\/documents\/advisory_opinions\/graham-james-llp\/grahamandjames.pdf"}