The circulation of threats of suit for infringement of patents or trade-marks among customers or prospective customers of competitors, not made in good faith but with the effect of intimidating such customers or prospective customers, or of hampering or injuring competitors in their businesses, is an unfair trade practice.

§ 155.12 Coercing purchase of one product as a prerequisite to the purchase of other products.

The practice of coercing the purchase of one or more products as a prerequisite to the purchase of one or more other products, where the effect may be to substantially lessen competition or tend to create a monopoly or to unreasonably restrain trade, is an unfair trade practice.

§ 155.13 Bogus independents.

It is an unfair trade practice to sell or offer to sell industry products through a pretended independent concern in such manner as to mislead or deceive customers or prospective customers into the erroneous belie that such concern is independent and in competition with that member of the industry owning or controlling such concern.

§ 155.14 Selling below cost.

The practice of selling industry products below the seller's cost, when pursued with wrongful intent of thereby injuring a competitor and where the effect of such practice is to unreasonably restrain trade, tend to create a monopoly, or substantially lessen competition, is an unfair trade practice.

This section is not to be construed as prohibiting all sales below cost, but only such selling below the seller's cost as is resorted to and pursued as a monopolistic practice with the wrongful intent referred to and coupled with the effect of unreasonably restraining trade, tending to create a monopoly, or substantially lessening competition.

The costs referred to in this section are actual costs of the respective seller and not some other figure or average costs in the industry determined by an industry cost survey or otherwise.

§ 155.15

Discrimination; prohibited discriminatory prices, or rebates, refunds, discounts, credits, etc., which effect unlawful price discrimination. (a) General. It is an unfair trade practice for any member of the industry engaged in commerce, in the course of such commerce, to grant or allow, secretly or openly, directly or indirectly, any rebate, refund, discount, credit, allowance for alleged imperfect workmanship after material has been cut, or other form of price differential, where such rebate, refund, discount, credit, allowance for alleged imperfect workmanship, or other form of price differential, effects a discrimination in price between different purchasers of commodities of like grade and quality, where either or any of the purchases involved therein are in commerce, and where the effect thereof may be substantially to lessen competition or tend to create a monopoly in any line of commerce or to injure, destroy, or prevent competition with any person who either grants or knowingly receives the benefit of such discrimination, or with customers of either of them: Provided, however, (1) That the goods involved in any such transaction are sold for use, consumption, or resale within any place under the jurisdiction of the United States;

(2) That nothing contained in this section shall prevent differentials which make only due allowance for differences in the cost of manufacture, sale, or delivery resulting from the differing methods or quantities in which such commodities are to such purchasers sold or delivered;

(3) That nothing contained in this section shall prevent persons engaged in selling goods, wares, or merchandise in

commerce from selecting their own customers in bona fide transactions and not in restraint of trade;

(4) That nothing contained in this section shall prevent price changes from time to time where made in response to changing conditions affecting either (i) the market for the goods concerned, or (ii) the marketability of the goods, such as, but not limited to, actual or imminent deterioration of perishable goods, obsolescence of seasonal goods, distress sales under court process, or sales in good faith in discontinuance of business in the goods

concerned.

(b) Prohibited brokerage and commissions. It is an unfair trade practice for any member of the industry engaged in commerce, in the course of such commerce, to pay or grant, or to receive or accept, anything of value as a commission, brokerage, or other compensation, or any allowance or discount in lieu thereof, except for services rendered in connection with the sale or purchase of goods, wares, or merchandise, either to the other party to such transaction or to an agent, representative, or other intermediary therein where such intermediary is acting in fact for or in behalf, or is subject to the direct or indirect control, of any party to such transaction other than the person by whom such compensation is so granted or paid.

(c) Prohibited advertising or promotional allowances, etc. It is an unfair trade practice for any member of the industry engaged in commerce to pay or contract for the payment of advertising or promotional allowances or any other thing of value to or for the benefit of a customer of such member in the course of such commerce as compensation or in consideration for any services or facilities furnished by or through such customer in connection with the processing, handling, sale, or offering for sale, of any products or commodities manufactured, sold, or offered for sale by such member, unless such payment or consideration is available on proportionally equal terms to all other customers competing in the distribution of such products or commodities.

(d) Prohibited discriminatory services or facilities. It is an unfair trade practice for any member of the industry engaged in commerce to discriminate in favor of one purchaser against another

purchaser or purchasers of a commodity bought for resale, with or without processing, by contracting to furnish or furnishing, or by contributing to the furnishing of, any services or facilities connected with the processing, handling, sale, or offering for sale, of such commodity so purchased upon terms not accorded to all purchasers on proportionally equal terms.

(e) Inducing or receiving an illegal discrimination in price. It is an unfair trade practice for any member of the industry engaged in commerce in the course of such commerce, knowingly to induce or receive a discrimination in price which is prohibited by the provisions of this section.

(1) Purchases by schools, colleges, universities, public libraries, churches, hospitals and charitable institutions not operated for profit. The foregoing provisions of this section relate to practices within the purview of the RobinsonPatman Antidiscrimination Act, which act and the application thereunder of this section are subject to the limitations expressed in the amendment to such Robinson - Patman Antidiscrimination Act, which amendment was approved May 26, 1938, and reads as follows:

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That nothing in the Act approved June 19, 1936 (Public, Numbered 692, Seventy-fourth Congress, second session), known as the RobinsonPatman Antidiscrimination Act, shall apply to purchases of their supplies for their own use by schools, colleges, universities, public libraries, churches, hospitals, and charitable institutions not operated for profit.

(Sec. 2, 38 Stat. 730, as amended, secs. 2, 8, 4, 49 Stat. 1527, 1528, ch. 283, 52 Stat. 446; 15 U. S. C. 13, 13a, 13b, 13c, 21a)

§ 155.16 "End piece pilfering," false invoicing, etc.

(a) In the course of or in connection with conduct of business by any member of the industry involving the sale of, or contract to furnish, products of the industry to his customers, it is an unfair trade practice for any such member to use the device or scheme of false invoicing or of so-called end piece pilfering or of any other device or scheme characterized by deception or fraud.

Sec.

157.10 Alding or abetting use of unfair trade practices.

AUTHORITY: The provisions of this Part 157 issued under secs. 6(g), 5, 38 Stat. 722, 719; 15 U.S.C. 46 (g), 45, unless otherwise noted.

SOURCE: The provisions of this Part 157 appear at 8 F.R. 17256, Dec. 23, 1943, unless otherwise noted.

§ 157.1 Misbranding and misrepresentation.

(a) The use on any product or article offered for sale, sold, or distributed of any marks, brands, or labels which are false, misleading, or deceptive in respect of such product or article, or in respect of the grade, quality, quantity, use, size, weight, material content, origin, preparation, manufacturer, or distribution thereof, or which are false, misleading, or deceptive in any other respect, is an unfair trade practice.

(b) It is an unfair trade practice to make or publish, or cause to be made or published, in advertisements, catalogs, bulletins, circulars, or by radio, or in any other manner, any statement or represenation which is false, misleading, or deceptive in respect of any product or article offered for sale, sold, or distributed, or in respect of the grade, quality, quantity, use, size, weight, material content, origin, preparation, manufacture, or distribution thereof, or which is false, misleading, or deceptive in any other respect.

§ 157.2 Passing off inferior sterling silverware as that of superior grade,

prices, when such do not represent actual bona fide selling prices, or which are misleading or deceptive in any respect. Nothing in this section, however, shall be so construed as:

(1) To prevent the use in catalogs or sales literature of figures, letters, or symbols, or combinations thereof, purporting merely to be the catalog number of the item or article listed, which number is not accompanied by the dollar sign or decimal point indicating dollars and cents, and is not represented to be, and does not by position on the page or otherwise purport to be, a price of any kind, but is used to provide a number and basis for use in computing the dealer's or purchaser's cost (illustrative number "1593U1975");

(2) To prevent the use in catalogs or sales literature of the term "Catalog Figure" (or its abbreviation "Cat. Fig.") followed by a number, or the use of a number immediately preceded or followed by a symbol, when such term, number, or symbol is not accompanied by the dollar sign or decimal point indicating dollars and cents, and when such term, number, or symbol as used is not a price of any kind nor is represented as such, but, while occupying a position on the page ordinarily occupied by price marks, is used merely to provide a number and basis for computing the dealer's or purchaser's cost, which method is described on another page: Provided, however, That on each page showing such term, number, or symbol, there is conspicuously and prominently set forth a notice to the effect that the "Catalog Figure" or "Cat. Fig.," or the number immediately preceded or followed by a symbol, is not a price but is a number or code mark from which the selling price of the catalog house is determined. The following are examples of such markings specified in this paragraph: (Description of article offered for sale).

or

Catalog Figure 18%

NOTICE: The figures designated Catalog Figures (Cat. Fig.) shown on this page are not retail prices nor any other prices. They are merely assigned figures from which the dealer or purchaser may determine his cost.

or

++This is not a price but a code symbol from which you find your cost. See page

--.

(b) Nothing in this section shall be construed as prohibiting the showing of a bona fide suggested resale price when clearly and nondeceptively designated as a suggested resale price: Provided, That as a resale price it is fair and reasonable and is not fictitiously inflated nor deceptively higher than the ordinary going resale price in the general market for such articles of the grade and quality to which the suggested resale price is applied: And provided further, That no deception is practiced in respect thereto.

(c) Except insofar as authorized or required by law, nothing in this section shall be construed as requiring or permitting any number of the industry or other person to cause, directly or indirectly, any dealer or other reseller to charge any certain price or to fix or control the price at which any such dealer, reseller, or other person shall sell or resell any product.

§ 157.4 Misrepresentation of character of business.

(a) It is an unfair trade practice for any member of the industry, through catalogs, advertisements, or other means, to represent or hold himself or itself out directly or indirectly as being a wholesaler, jobber, distributor, wholesale distributor, wholesale jeweler, manufacturer, manufacturing wholesaler, manufacturer's distributor, importer, or exporter:

(1) Unless such member of the industry is respectively such wholesaler jobber, distributor, wholesale distributor, wholesale jeweler, manufacturer, manufacturing wholesaler, manufacturer's distributor, importer, or exporter in respect of all the articles or products offered for sale or advertised in such catalogs or under such representations;

or

(2) Unless, when true in part only, the representation is accompanied, in immediate conjunction, by such explicit qualifications or disclosure as will confine

the representation within truthful scope, expressed and implied, showing the fact that such member is, as the case may be, such wholesaler, jobber, distributor, wholesale distributor, wholesale jeweler, manufacturer, manufacturing whole

saler, manufacturer's distributor, importer, or exporter as to only a certain stated proportion, or designated groups, of articles (or only as to certain specified articles) and not as to all the articles or products offered for sale, advertised, cataloged, or sold under or in connection with such representation.

(b) It is an unfair trade practice for any member of the industry to represent, by catalog, advertisement, or otherwise, that any article or product offered for sale by such member may be secured directly or indirectly from such member at the usual wholesale price or at other designated price when such is not true in fact.

§ 157.5 Deceptive set-up of disclosed information.

In setting forth any statement, designation, or other information to be disclosed under any of the rules in this part, the same shall be set forth clearly and unequivocally and not in a minimized or obscured manner, nor shall it be remotely or inconspicuously placed. Failure or refusal to make such disclosure in accord with the provisions of the sections in this part, thereby causing or promoting deception of the purchasing or consuming public or injury to competition, is an unfair trade practice. § 157.6 Commercial bribery.

It is an unfair trade practice for a member of the industry, directly or indirectly, to give, or offer to give, or permit or cause to be given, money or anything of value to agents, employees, or representatives of customers or prospective customers, or to managers, superintendents, personnel officers, purchasing agents, or persons occupying similar positions in any business, without the knowledge of their employers or principals, as an inducement to influence such employers, principals, customers or prospective customers to purchase or contract to purchase products manufactured or sold by such industry member or the maker of such gift or offer, or to

The imitation or simulation of the trade-marks, trade names, brands, or labels of competitors, with the capacity and tendency or effect of misleading or deceiving the purchasing or consuming public, is an unfair trade practice.

§ 157.8 Combination or coercion to fix prices, suppress competition, or restrain trade.

It is an unfair trade practice for a member of the industry or any person, firm, partnership, corporation, or association:

(a) To use, directly or indirectly, any form of threat, intimidation, or coercion against any member of the industry to unlawfully fix, maintain, or enhance prices, suppress competition, or restrain trade; or

(b) To enter into or take part in, directly or indirectly, any agreement, understanding, combination, conspiracy, or concert of action with one or more members of the industry, or with one or more persons, firms, partnerships, corporations, or associations, to unlawfully fix, maintain, or enhance prices, suppress competition, or restrain trade.

(a) Prohibited discriminatory prices, or rebates, refunds, discounts, credits, etc., which effect unlawful price discrimination. It is an unfair trade practice for any member of the industry engaged in commerce, in the course of such commerce, to grant or allow, secretly or openly, directly or indirectly, any rebate, refund, discount, credit, or other form of price differential, where such rebate, refund, discount, credit, or other form of price differential, effects a discrimination in price between different purchasers of goods of like grade and quality, where either or any of the purchases involved therein are in commerce, and where the effect thereof may be substantially to lessen competition or tend to create a monopoly in any line of com