FOR
YOUR INFORMATION:
MAY 2, 1997
The Federal Trade Commission today announced the
following actions.
Applications for approval of
transactions: The FTC has received
applications for approval for transactions from the
following entities. The FTC is seeking public comments on
the applications for 30 days, until June 2.
- Baxter International, Inc., of Deerfield,
Illinois, has applied for FTC approval to divest
by license the Immuno Fibrin Sealant
assets, a product in development that will be
used to control bleeding in surgical procedures,
to Haemacure Corporation, a Canadian firm.
Divestiture of these assets is required under a
February 1996 consent order designed to restore
competition, allegedly injured as a result of
Baxters acquisition of Immuno
International, for the development for fibrin
sealant. (The FTC case also challenged the
acquisition as to a plasma product used for the
treatment of Factor VIII inhibitors in
hemophiliacs. A divestiture application regarding
a required divestiture in that market is pending
at the FTC.) The divestiture requirements in the
consent order are designed to restore
competition. (See Dec. 19, 1996
news release for more details regarding the
consent order; Docket No. C-3726.) Staff contact
is Elizabeth A. Piotrowski, 202-326-2623.
- Phillips Petroleum Company, of
Bartlesville, Oklahoma, has applied for FTC
approval to divest approximately 160 miles of its
natural gas pipeline system in Oklahoma to KN
Gas Gathering, Inc., of Douglas, Wyoming. The
divestiture of this pipeline is required under a
March 1997 consent order settling charges that
Phillips acquisition of gas gathering
assets from ANR Pipeline Company violated
antitrust laws in that it would substantially
reduce competition for natural gas gathering
services in areas of five Oklahoma counties. The
divestiture is designed to restore competition. (See
Dec. 30,
1996 news release for more details
about this case; Docket C-3728.) Staff contact is
Daniel Ducore, 202-326-2526.
Consent agreements given
final approval: Following a public comment
period on each, the Commission has made final consent
agreements with the following entities. The Commission
action makes the consent orders binding on the
respondents.
- The consent
order with The Money Tree, Inc., of
Bainbridge, Georgia, and company officer Vance
R. Martin, settles charges that they required
consumers applying for loans to purchase some
combination of credit-life insurance,
credit-disability insurance, accidental death and
dismemberment insurance, and/or an auto club
membership, but did not include the cost of these
mandatory "extras" in the finance
charge and the annual percentage rate disclosed
to consumers, as required by the Truth in Lending
Act and Regulation Z. Instead, the FTC alleged,
Money Tree included the cost of the extras in the
amount financed, causing consumers to pay
interest on the premiums and fees for these
extras. In addition, the FTC alleged that the
respondents violated the Fair Credit Reporting
Act by failing to disclose to consumers, when
their credit applicatons were denied because of
information ocntained in a credit report, the
name and address of the credit bureau that
supplied the credit report. This disclosure
triggers a consumers right to get a free
copy of his or her credit report to check for
errors. The order requires Money Tree to offer
customers the chance to cancel the credit-life,
credit-disability, or accidental death and
dismemberment insurance they purchased, and to
obtain cash refunds or credits which could amount
to as much as $1.2 million. The order also bars
Money Tree and Martin from requiring consumers to
sign statements that such purchases are voluntary
if, in fact, they are required to obtain the
loan; from referring to credit-related insurance
or auto club memberships without, at the same
time, telling consumers their loan applica tions
have been approved and the amount of the approved
loans; and requires the respondents to disclose
to consumers that such coverage is optional and
to have those consumers sign a form acknowledging
that fact and stating that the consumers
loans already have been approved and the amount
the extras will cost if they choose to purchase
them. The order also bars violations of the FCRA
provisions regarding disclosures to consumers
when their credit reports played a role in the
denial of credit. (See. Feb. 4,
1996 news release for more details
regarding this case; Docket No. C-3735;
Commission vote on April 28 to issue this order
as final was 5-0.) Staff contacts are Thomas Kane
and Rolando Berrelez, 202-326-3224.
- The consent
order with Nationwide Syndications, Inc.,
of Barrington, Illinois, and company president Thomas
W. Karon, settles charges that they made
false and unsubstantiated claims regarding the
benefits of their NightSafe Glasses, which purpor
tedly make night driving safer by improving night
vision. The order prohibits the respondents from
representing that NightSafe Glasses or any
substantially similar product makes driving safer
or improves night vision, and requires them to
have competent and reliable scientific evidence
to substantiate claims about the efficacy,
performance, bene fits or safety of such
products. The order also bars use of the trade
name "NightSafe," or any other trade
name that implies the use of such a product makes
night driving safer. In addition, the respondents
will pay $125,000 in consumer redress, and will
provide the FTC with the names and addresses of
purchasers so that the FTC can send them a safety
notice about using NightSafe Glasses while
driving at night. (See Jan. 24, 1997
news release for more details regarding this
case; Docket No. C-3736; Commission vote on April
28 to issue the order as final was 5-0.) Staff
contact is Steven Baker, Chicago Regional Office,
312-353-8156.
- The consent
order with SplitFire, Inc., of
Northbrook, Illinois, settles charges that the
fuel economy, efficiency and improved performance
claims it made in ads for its spark plugs were
false or unsubstantiated. The consent order
prohibits SplitFire from making fuel economy,
emissions, horsepower, or cost savings claims
without competent and reliable scientific
evidence to support them. It also bars
misrepresentations about the existence, contents,
validity, results, conclusions or interpretations
of any test or study. In connection with
testimonials, the order requires SplitFire to
have competent and reliable scientific evidence
to substantiate claims in endorsements or
testimonials; to disclose either what the typical
or ordinary consumers experience would be or the
limited applicability of the endorsers
experience to other consumers. (See Feb. 11, 1997
news release for details regarding this case;
Docket No. C-3737; Commission vote on April 28 to
issue this order as final was 5-0.) Staff contact
is Laura Fremont, San Francisco Regional Office,
415-356-5270.
- The consent
order with Zale Corporation, of
Irving, Texas, settles charges that Zale
deceptively advertised its "Ocean
Treasures" line of imitation pearl jewelry
as composed of cultured pearls. The consent order
prohibits Zale from misrepresenting the composi
tion or origin of any imitation, cultured or
natural pearl product. It also requires Zale to
include a word such as "artificial,"
"imitation," or "simulated"
in close proximity to any representation that an
imitation pearl product contains pearls; and to
include a word such as "cultured" or
"cultivated" in close proximity to any
representation that a cultured pearl product
contains pearls. In addition, the order requires
Zale, for three years, to make available to
consumers in Zales stores an information
sheet that describes the origin of imitation,
cultured and natural pearls. (See Feb. 10, 1997
news release for more details regarding this
case; Docket No. C-3738; Commission vote on April
28 to issue this order as final was 5-0.) Staff
contact is Matthew Gold, San Francisco Regional
Office, 415- 356-5276.
Comments
on the Baxter and Phillips applications should be
addressed to the FTC, Office of the Secretary, 6th Street
and Pennsylvania Avenue, N.W., Washington, D.C. 20580.
Copies of the documents
referenced above are available from the FTCs
Public Reference Branch, Room 130, at the same address;
202-326-2222; TTY for the hearing impaired 1-866-653-4261.
To find out the latest news as it is announced, call the
FTC NewsPhone recording at 202-326-2710. FTC news
releases and other materials also are available on the
Internet at the FTCs World Wide Web site at: http://www.ftc.gov
MEDIA
CONTACT:
Office of Public Affairs
202-326-2180
(petapp26.97)
|