Stauffer Laboratories, Inc., a Corporation v. Federal Trade Commission

343 F.2d 75, 1965 U.S. App. LEXIS 6505, 1965 Trade Cas. (CCH) 71,384
CourtCourt of Appeals for the Ninth Circuit
DecidedFebruary 17, 1965
Docket19279
StatusPublished
Cited by9 cases

This text of 343 F.2d 75 (Stauffer Laboratories, Inc., a Corporation v. Federal Trade Commission) is published on Counsel Stack Legal Research, covering Court of Appeals for the Ninth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Stauffer Laboratories, Inc., a Corporation v. Federal Trade Commission, 343 F.2d 75, 1965 U.S. App. LEXIS 6505, 1965 Trade Cas. (CCH) 71,384 (9th Cir. 1965).

Opinion

POPE, Circuit Judge.

This is a petition to review a cease and desist order issued by the Federal Trade Commission directed to the petitioner Stauffer Laboratories, Inc. (hereafter called Stauffer) and its principal officer, pursuant to a complaint charging the petitioner with using unfair or deceptive acts or practices in commerce and with disseminating false and misleading advertisements with respect to a certain device which it offered for sale and sold, and which it called its “Magic Couch” or “Posture-Rest”.

This so-called “couch” consists of a central oscillating section measuring ten by fifteeen inches and two larger sections that are attached to opposite sides of the central section. The couch is intended to be used in connection with a plan known as the “Stauffer Home Plan.” The entire plan consists of two parts. One is the use of the couch and the other is the following of a low calorie diet. In the use of the couch the user lies upon it with his head on one attached portion and his legs on another while the central portion of his body is given what is called “effortless exercise” through the oscillation of the central portion. The representation of the advertising involved is that by following the plan the purchaser will lose weight.

The complaint before the Commission was not addressed to the plan as a whole' but rather to certain advertisements which the complaint alleged amounted to statements that the use of the couch alone, when used in a program of effortless exercise, would cause loss of weight and increase muscle tone. The allegation was that the advertisements here under attack directly or inferentially asserted that the couch, taken alone and by itself, and apart from any other portion of a so-called “plan”, is of value in bringing about weight reduction and a toning of sagging muscles. The complaint then charges, and the Commission found, that the “Magic Couch” cannot *77 and will not perform in accordance with these claims, and that it has no value or usefulness in accomplishing the asserted results.

The opinion of the Commission sets forth certain of the accused advertisements which it found to be typical. They are copied in the margin. 1 In the process of making its finding that the petitioner in its advertisements was making claims for the effectiveness of the device independently of the plan the Commission discussed these advertisements as follows : “While it is true that respondents mention the ‘plan’ in their advertising, the emphasis is mainly on the device. The advertisements state or imply that the device itself will provide or contribute to the claimed benefits. For instance, one representation reads: ‘This exercise does away with inches * * * tones and firms hard to reach problem areas. * * * The ‘This exercise’ is the exercise which the user is supposed to get from the couch; hence, according to the representation, it is the couch itself which does the reducing and toning.

“While the advertisements briefly refer to calorie reduction,, the general impression is that the couch provides most or all of the benefits. Certain of the advertisements state that the couch adds something which the user can’t get by the diet alone, thus clearly plugging the merits of the couch. An exampié is as follows: ‘When you want to lose both inches and pounds, exercise on the Magic Couch is combined with sensible calorie reduction. This brings about results you just can’t get from diet alone. * *' (Emphasis supplied.) The significance of the device is stressed in other ways, such as by referring to it as the ‘heart of the famous Stauffer Home Reducing Plan’ and by prominent illustrations. In addition, respondents’ advertisements mention ‘effortless exercise’, which plainly places the emphasis on the device, *78 and they make claims for reductions in specific areas (e. g., ‘hard to lose inches from ankles, thighs, hips and tummy’), which suggest the exercising of these areas by the device. When all these factors are considered, there is no doubt that respondents, though selling a device in conjunction with a plan, are also making claims for the effectiveness of the device independent of the plan.”

The petitioner takes issue with these findings of the Commission saying: “The Commission erringly concludes that the potential purchaser of the Plan is misled into believing that any and all benefits resulting from the Plan are obtained solely through use of the Device. But, Petitioner advertises and sells a ‘Stauffer Home Plan,’ a ‘Stauffer Home Reducing Plan,’ a ‘Figure-Beautifying Plan,’ and a ‘Stauffer Principle’ of ‘sensible’ weight reduction and muscle toning. All of these terms are constantly used in Petitioner’s advertising and booklets.” Although the texts of these advertisements are before us, and in that sense the facts as to what the advertisements were are undisputed, yet we are not for that reason free to disagree with the Commission’s finding to the effect that the advertisements did make these claims for the effectiveness of the device independent of the plan. In reviewing the findings of a district court, the established rule, recognized by this court, is that in respect to inferences drawn from undisputed facts the findings may not be set aside unless found to be clearly erroneous. Lundgren v. Freeman, 9 Cir., 307 F.2d 104, 115. In that case this court adopted the rationale employed by the Supreme Court in Commissioner v. Duberstein, 363 U.S. 278, 289, 80 S.Ct. 1190, 1198, 4 L.Ed.2d 1218, where the Court said: “Decision of the issue presented in these cases must be based ultimately on the application of the fact-finding tribunal’s experience with the mainsprings of human conduct to the totality of the facts of each case.”

That view of the significance of the inference drawn by the fact finding body is even more applicable in the review of a decision of the Federal Trade Commission, for in such a review we must take into account the experience and the expertise of the Commission which is set up to deal with precisely this sort of thing in the advertising field. This court stated in Carter Products, Inc. v. F. T. C., 9 Cir., 268 F.2d 461, 495, “The Commission is deemed to have expert experience in dealing with matters of the character involved in the instant case. * * * And it may draw upon its own experience in order to determine (even) in the absence of consumer testimony, the natural and probable result of the use of advertising expressions.”

We cannot hold erroneous the Commission’s finding as to what the advertisements stated and represented even if we were inclined to disagree with the Commission, which we are not.

Petitioner argues that as a matter of law the Commission cannot consider the device, that is the couch, otherwise than as an inextricable component of petitioner’s whole plan. Petitioner says that the device, while essential, is inextricably intertwined with the plan. There is no doubt that in working out its selling program petitioner undertook to tie the device in with its whole plan, for the device obviously was the money making portion of the enterprise.

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343 F.2d 75, 1965 U.S. App. LEXIS 6505, 1965 Trade Cas. (CCH) 71,384, Counsel Stack Legal Research, https://law.counselstack.com/opinion/stauffer-laboratories-inc-a-corporation-v-federal-trade-commission-ca9-1965.