§ 165.101

GROUP II

Disapproval of solicitation when benefits unlikely.

The industry condemns the practice of soliciting or promoting the sale of any of its products to persons who by reason of their physical state, age or infirmity, cannot be expected to obtain reasonable use and benefit from such products. This rule shall not be regarded as preventing the purchase of an industry product by any person who requests such a device, notwithstanding such person may not thereby obtain a reasonable degree of use and benefit therefrom.

§ 165.102 Cooperation with doctors.

The industry fully realizes that the interest of amputees is best promoted by the cooperation of the doctor and industry member with respect to the site of amputation and the type and fitting of industry products, and as to the appropriate time for consideration by the patient of the purchase of a prosthetic device. The industry pledges its members to give every assistance and advice to doctors prior to and after the amputation that the amputee may have the optimum of benefit from the industry product which he may later purchase and use, whether or not such industry member sells, or has opportunity to solicit the purchase of, his products; and to do everything possible to promote mutual trust and confidence between the industry and members of the medical profession.

§ 165.103 Importance of personal fitting.

The industry disapproves of the practice of undertaking to supply an artificial limb that will fit an amputee by mail-order specifications and without personal fitting thereof, as it believes that satisfactory and proper fit cannot be attained except by personal fitting. This rule shall not be construed as prohibiting sale of artificial limbs by mail order without personal fitting when no misrepresentation is made, directly or by implication, as to fit.

§ 165.104 Minimizing importance of "fit" by exploitation of less important features.

It is the concensus of the industry that proper fit and alinement are of vital importance with respect to the

satisfactory use of its products by amputees and should not be minimized by the undue exploitation of other aspects or features of less importance.

§ 165.105 Sharing of improved techniques.

Believing that the interest of amputees is its first concern, the industry favors the making available to all of its members and the general public any improved technique that may be used or developed by any of its members in respect to the making, fitting, alining, or servicing of industry products. Further, the industry desires to be an active and cooperative factor in all progressive developments of improved techniques that will contribute to the welfare and comfort of all amputees.

It is an unfair trade practice for any member of the industry to use, or cause or promote the use of, any label, brand, or mark, which has the capacity and tendency or effect of misleading or deceiving purchasers or prospective purchasers with respect to the type, brand, grade, quality, composition, tests, durability, serviceability, performance, quantity, origin, size, substance, character, nature, material, content, price, value, preparation, manufacture, distribution, or marketing of any product, or in any other respect.

It is an unfair trade practice for any member of the industry to use, or cause or promote the use of, any trade promotional literature, advertising matter, testimonial, guarantee, warranty, designation, or representation, however disseminated or published, which has the capacity and tendency or effect of misleading or deceiving purchasers or prospective purchasers with respect to the type, brand, grade, quality, composition, tests, durability, serviceability, performance, quantity, origin, size, substance, character, nature, material, content, price, value, preparation, manufacture, distribution, or marketing of any product, or in any other respect.

§ 166.3 Deceptive concealment of price charged for so-called premiums.

In the offering of so-called premiums in combination or in connection with the sale or offering for sale of piston rings, it is an unfair trade practice:

(a) To represent, directly or by implication, that the so-called premium is given without additional charge when in fact a charge therefor is included in the price of such piston rings; or

(b) To conceal or fail to disclose the fact that the selling price at which piston rings are sold or offered for sale includes a charge for such so-called premium which is in addition to the regular and customary selling price of such piston rings, where such concealment or failure to disclose has the capacity and tendency or effect of misleading or deceiving purchasers or prospective purchasers; or

(c) To conceal or fail to disclose what part or proportion of such selling price is attributable to the so-called premium, where such concealment or failure to dis

The publishing or circulating by any member of the industry of false or misleading price quotations, price lists, or terms or conditions of sale, with the capacity and tendency or effect of misleading or deceiving purchasers or prospective purchasers, is an unfair trade practice.

§ 166.5 False invoicing.

Withholding from or inserting in an invoice any statements or information by reason of which omission or insertion a false record is made, wholly or in part, of the transaction represented on the face of such invoice, with the effect of thereby misleading or deceiving purchaser or prospective purchasers, is an unfair trade practice.

§ 166.6 Imitation of trade-marks, trade names, etc.

The imitation or simulation of the trade-marks, trade names, or other marks of identification of competitors, with the capacity and tendency or effect of misleading or deceiving purchasers or prospective purchasers, is an unfair trade practice.

§ 166.7 Misuse of word "free,” etc.

The use of the word "free," or any other term or representation of similar import or meaning, to describe, designate, or refer to any piston ring or so-called premium offered in connection therewith which is not given to the recipient thereof without cost and unconditionally, is an unfair trade practice.

CROSS REFERENCE: For other provisions relating to the use of premiums, see §§ 166.3, 166.11, 166.12 and 166.16.

to make good on claims coming reasonably within the terms of the guarantee; or

(b) Guarantees which are so used or are of such form, text, or character as to import, imply, or represent that the guarantee is broader than is in fact true, or will afford more protection to purchasers or users than is in fact true; or

(c) Guarantees in which any condition, qualification, or contingency applied by the guarantor thereto is not fully and nondeceptively stated therein, or is stated in such manner or form as to be deceptively minimized, obscured, or concealed, wholly or in part; or

(d) Guarantees containing statements, representations, or assertions which have the capacity and tendency or effect of misleading and deceiving purchasers or prospective purchasers with respect to the serviceability, durability, or lasting qualities of any piston rings, or which guarantees, either in themselves or in the manner of their use, are otherwise false, misleading, or deceptive; or

(e) Guarantees which are not furnished all purchasers on proportionally equal terms contrary to the provisions of § 166.16, or are otherwise discriminatory within the inhibitions of § 166.16.

§ 166.9 Coercing purchase of one prodduct 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.

§ 166.10 Exclusive deals.

It is an unfair trade practice for any member of the industry to purchase or otherwise acquire from a distributor or dealer the stock of a competitor or competitors of such industry member, to make loans to a distributor or dealer, or to guarantee a distributor or dealer increased profits as compared with profits previously obtained in the handling of competitive products, when such acts or practices are done:

(a) Upon any express or implied condition, agreement, or understanding, that the distributor or dealer will discontinue handling competitive products and will handle such member's products exclusively; or

(b) As an inducement to the distributor or dealer to discontinue handling competitive products and to handle such member's products exclusively,

and where the effect of such acts or practices may be to substantially lessen competition, or tend to create a monopoly, or to unreasonably restrain trade. § 166.11 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, whether in the guise of premiums or otherwise, to agents, employees, or representatives of customers or prospective customers, or to agents, employees, or representatives of competitors' customers or prospective customers, without the knowledge of their employers or principals, as an inducement to influence their employer or principals to purchase or contract to purchase piston rings manufactured or sold by such industry member or the maker of such gift or offer, or to influence such employers or principals to refrain from dealing in the piston rings of competitors or from dealing or contracting to deal with competitors.

CROSS REFERENCE: For other provisions relating to the use of premiums, see §§ 166.3, 166.7, 166.11 and 166.16.

§ 166.12 "Spiffs," "push money,” “premiums," etc.

It is an unfair trade practice for any member of the industry, directly, or indirectly, to give, pay, or contract to pay, to any clerk, salesperson, purchasing agent, stockroom man, mechanic, or other employee, of any customer-dealer handling two or more competitive brands of piston rings, "push money," "spiffs," or any other bonus, gratuity, or payment, whether in the guise of premiums or otherwise, as an inducement or encouragement to push or promote the sale of such member's piston rings over competing piston rings of other members of the industry;

(a) With the capacity and tendency or effect of thereby causing purchasers or prospective purchasers, when making purchases of such piston rings, to be misled or deceived into the erroneous belief that such clerk, salesperson, purchasing agent, stockroom man, mechanic, or other employee, is free from any such special interest or influence, or is not so subsidized or paid by such member; or

(b) With the capacity and tendency or effect of thereby hampering and unduly restricting the legitimate, free, and full use and enjoyment of such trade outlets for the distribution of competing piston rings; or

(c) With the purpose or effect, directly or indirectly, of otherwise substantially lessening competition or unreasonably restraining trade in the marketing of piston rings; or

(d) With the effect of thereby bringing about the granting of an illegally discriminatory service, payment, or price contrary to the provisions of § 166.16.

CROSS REFERENCE: For other provisions relating to the use of premiums, see §§ 166.3, 166.7, 166.12 and 166.16.

§ 166.13 Consignment shipping.

It is an unfair trade practice for any member of the industry to use the practice of shipping piston rings on consignment or pretended consignment for the purpose and with the effect of artificially clogging trade outlets and unduly restricting competitors' use of said trade outlets in getting their piston rings to consumers through regular channels of distribution, or with such purpose to entirely close said trade outlets to such competitors so as to substantially lessen competition or tend to create a monopoly or to unreasonably restrain trade: Provided, however, That nothing in this section shall be construed or used as restricting or preventing consignment shipping or marketing of piston rings in good faith and without artificial interference with competitors' use of the usual channels of distribution in such manner as thereby to suppress competition or restrain trade.

§ 166.14 Defamation of competitors or disparagement of their products.

The defamation of competitors by falsely imputing to them dishonorable conduct, inability to perform contracts, questionable credit standing, or other false representations, or the false disparagement of the type, brand, grade, quality, composition, tests, durability, serviceability, performance. quantity, origin, size, substance, character, nature, material, content, price, value, preparation, manufacture, distribution, or marketing of the piston rings of competitors, or of their business methods, values, credit terms, or policies, or in any other respect, is an unfair trade practice.

§ 166.15 Selling below cost.

The practice of selling piston rings below the seller's cost with the intent and with the effect of injuring a competitor and where the effect may be substantially to lessen competition or tend to create a monopoly or unreasonably restrain trade is an unfair trade practice. All elements recognized by good accounting practice as proper elements of such cost shall be included in determining cost under this section. The costs, however, which are 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.

(a) Prohibited discriminatory prices, or rebates, refunds, so-called free goods, premiums, 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, so-called free goods, premium, discount, credit, or other form of price differential, where such rebate, refund, so-called free goods, premium, discount, credit, or other form of price differential, effect 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 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 (1) 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 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 foregoing provisions of this section.

(f) 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 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 Robinson-Patman 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. 780, as amended, secs. 2, 3, 4, 49 Stat. 1527, 1528, ch. 283, 52 Stat. 446; 15 U. S. C. 13, 13a, 13b, 13c, 21a)

CROSS REFERENCE: For other provisions relating to the use of premiums, see §§ 166.3, 166.7, 166.11, and 166.12.