Arizona Automobile Dealers Association; Proposed Consent Agreement With Analysis To Aid Public Comment |
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Topics: Arizona Automobile Dealers Association
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Donald S. Clark
Federal Trade Commission
March 21, 1994
[Federal Register Volume 59, Number 54 (Monday, March 21, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 94-6536]
[[Page Unknown]]
[Federal Register: March 21, 1994]
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FEDERAL TRADE COMMISSION
[File No. 931 0056]
Arizona Automobile Dealers Association; Proposed Consent
Agreement With Analysis To Aid Public Comment
AGENCY: Federal Trade Commission.
ACTION: Proposed consent agreement.
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SUMMARY: In settlement of alleged violations of federal law prohibiting
unfair acts and practices and unfair methods of competition, this
consent agreement, accepted subject to final Commission approval, would
prohibit, among other things, an Arizona association consisting of
approximately 199 dealers from restricting, regulating, or interfering
with truthful, non-deceptive comparative or price advertising or
advertising concerning financing among members in the future.
DATES: Comments must be received on or before May 20, 1994.
ADDRESSES: Comments should be directed to: FTC/Office of the Secretary,
room 159, 6th St. and Pa. Ave., NW., Washington, DC 20580.
FOR FURTHER INFORMATION CONTACT: Ralph Stone, FTC/San Francisco
Regional Office, 901 Market St., suite 570, San Francisco, CA 94103.
(415) 744-7920.
SUPPLEMENTARY INFORMATION: Pursuant to section 6(f) of the Federal
Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46 and Sec. 2.34 of the
Commission's Rules of Practice (16 CFR 2.34), notice is hereby given
that the following consent agreement containing a consent order to
cease and desist, having been filed with and accepted, subject to final
approval, by the Commission, has been placed on the public record for a
period of sixty (60) days. Public comment is invited. Such comments or
views will be considered by the Commission and will be available for
inspection and copying at its principal office in accordance with
Sec. 4.9(b)(6)(ii) of the Commission's Rules of Practice (16 CFR
4.9(b)(6)(ii)).
Agreement Containing Consent Order To Cease and Desist
In the matter of Arizona Automobile Dealers Association, a
corporation, File No. 931 0056.
The Federal Trade Commission, having initiated an investigation of
certain acts and practices of the Arizona Automobile Dealers
Association, a corporation, and it now appearing that the Arizona
Automobile Dealers Association, hereinafter sometimes referred to as
``AADA'' or ``proposed respondent,'' is willing to enter into an
agreement containing an order to cease and desist from the acts and
practices being investigated.
It is hereby agreed by and between AADA, by its duly authorized
officer, and its attorney, and counsel for the Federal Trade Commission
that:
1. AADA is a corporation organized, existing, and doing business
under and by virtue of the laws of the State of Arizona, with its
office and principal place of business at 4701 North 24th Street, suite
B-3, Phoenix, Arizona 85064-2717.
2. AADA admits all the jurisdictional facts set forth in the draft
of Complaint here attached.
3. AADA waives:
(a) Any further procedural steps;
(b) The requirement that the Commission's decision contain a
statement of findings of fact and conclusions of law;
(c) All rights to seek judicial review or otherwise to challenge or
contest the validity of the Order entered pursuant to this agreement;
and
(d) All claims under the Equal Access to Justice Act, 5 U.S.C. 504.
4. This agreement shall not become part of the public record of the
proceeding unless and until it is accepted by the Commission. If this
agreement is accepted by the Commission, it, together with the attached
draft of Complaint contemplated thereby, will be placed on the public
record for a period of sixty (60) days and information in respect
thereto publicly released. The Commission thereafter may either
withdraw its acceptance of this agreement and so notify the proposed
respondent, in which event it will take such action as it may consider
appropriate, or issue and serve its Complaint (in such form as the
circumstances may require) and decision, in disposition of the
proceeding.
5. This agreement is for settlement purposes only and does not
constitute an admission by proposed respondent that the law has been
violated as alleged in the draft of Complaint here attached, or that
the facts as alleged in the draft of Complaint, other than the
jurisdictional facts, are true.
6. This agreement contemplates that, if it is accepted by the
Commission, and if such acceptance is not subsequently withdraw by the
Commission pursuant to the provisions of Sec. 2.34 of the Commission's
Rules, the Commission may, without further notice to proposed
respondent, (a) issue its Complaint corresponding in form and substance
with the draft of Complaint here attached and its decision containing
the following Order to cease and desist in disposition of the
proceeding and (b) make information public in respect thereto. When so
entered, the Order to cease and desist shall have the same force and
effect and may be altered, modified or set aside in the same manner and
within the same time provided by statute for other orders. The Order
shall become final upon service. Delivery by the U.S. Postal Service of
the Complaint and decision containing the agreed-to Order to proposed
respondent's address as stated in this agreement shall constitute
service. Proposed respondent waives any right it may have to any other
manner of service. The Complaint may be used in construing the terms of
the Order, and no agreement, understanding, representation, or
interpretation not contained in the Order or the agreement may be used
to vary or contradict the terms of the Order.
7. Proposed respondent has read the proposed Complaint and Order
contemplated hereby. Proposed respondent understands that once the
Order has been issued, it will be required to file one or more
compliance reports showing that it has fully complied with the Order.
Proposed respondent further understands that it may be liable for civil
penalties in the amount provided by law for each violation of the Order
after it becomes final.
Order
I
It is ordered that, for purposes of this Order, the terms
``respondent'' or ``AADA'' mean the Arizona Automobile Dealers
Association, its directors, committees, officers, delegates,
representatives, agents, employees, successors, and assigns.
II
It is further ordered that AADA, directly or indirectly, or through
any person or any corporate or other device, in or in connection with
its activities as a trade association, in or affecting commerce, as
``commerce'' is defined in the Federal Trade Commission Act, shall
forthwith cease and desist from:
A. Prohibiting, restricting, regulating, impeding, declaring
unethical, interfering with, advising against, or discouraging: (1)
Truthful, non-deceptive discount or price advertising or (2) any person
or organization from otherwise engaging in truthful, non-deceptive
discount or price advertising;
B. Prohibiting, restricting, regulating, impeding, declaring
unethical, interfering with, advising against, or discouraging
truthful, non-deceptive advertising concerning the terms or
availability of consumer credit;
C. Prohibiting, restricting, regulating, impeding, declaring
unethical, interfering with, advising against, or discouraging: (1)
Truthful, non-deceptive disparaging or comparative advertising or (2)
any person or organization from otherwise engaging in truthful, non-
deceptive disparaging or comparative advertising; and
D. Inducing, suggesting, urging, encouraging, or assisting any non-
governmental person or organization to take any action that if take by
respondent would violate this Order; Provided That nothing contained in
this Order shall prohibit AADA from formulating, adopting,
disseminating to its members, and enforcing reasonable ethical
guidelines governing the conduct of its members with respect to
advertising, including unsubstantiated representations, that AADA
reasonably believes would be false or deceptive within the meaning of
Section 5 of the Federal Trade Commission Act.
III
It is further ordered that AADA shall:
A. Within thirty (30) days after the date this order becomes final,
remove from its Standards for Advertising Motor Vehicles, and from any
other existing policy statement or guideline, any provision,
interpretation or policy statement that is inconsistent with the
provisions of part II of this Order including, but not limited to
sections 4, 5, 6, and 11;
B. Within thirty (30) days after the date this Order becomes final,
publish in Topics or in any successor publication, (a) this Order, (b)
the accompanying Complaint, (c) any revision of the Standards for
Advertising Motor Vehicles or any other existing policy statement or
guideline of AADA made pursuant to part III.A. of this Order, and (d) a
complete revised version of the Standards for Advertising Motor
Vehicles.
C. Within thirty (30) days after the date this Order becomes final,
distribute by first-class mail a copy of this Order and the Complaint
to each of its members;
D. For a period of five (5) years after the date this Order becomes
final, provide each new member who joins AADA with a copy of the Order
and Complaint within thirty (30) days of membership in AADA;
E. Within sixty (60) days after the date this Order becomes final,
and annually thereafter for a period of five (5) years on the
anniversary of the date this Order became final, file with the
Secretary of the Commission a verified written report setting forth in
detail the manner and form in which AADA has complied with and is
complying with this Order; and
F. For a period of five (5) years after this Order becomes final,
maintain and make available to Commission staff for inspection and
copying, upon reasonable notice, all documents that relate to the
manner and form is which AADA has complied, and is complying with this
Order.
IV
It is further ordered that AADA notify the Commission at least
thirty (3) days prior to any change in AADA, such as dissolution or
reorganization resulting in the emergence of a successor corporation or
association, or any other change in the corporation or association
which may affect compliance obligations arising out of this Order.
Analysis of Proposed Consent Order To Aid Public Comment
The Federal Trade Commission has accepted, subject to final
approval, an agreement to a proposed consent order from the Arizona
Automobile Dealers Association (``AADA'').
The proposed consent order has been placed on the public record for
sixty (60) days for reception of comments by interested persons.
Comments received during this period will become part of the public
record. After sixty (60) days, the Commission will again review the
agreement and the comments received and will decide whether it should
withdraw from the agreement or make final the agreement's proposed
order.
Description of the Complaint
A complaint prepared for issuance by the Commission along with the
proposed order alleges that the members of AADA agreed to restrict
truthful, non-deceptive advertising. More specifically, the complaint
alleges that AADA adopted, published, and enforced its Standards for
Advertising Motor Vehicles that: (1) Prohibits discount advertising;
(2) restricts the advertising of consumer credit terms; and (3)
prohibits disparaging advertising.
The complaint alleges that AADA's agreement to restrict advertising
injured consumers by depriving them of truthful information pertinent
to the purchase of new automobiles and trucks.
Description of the Proposed Consent Order
The proposed order would prohibit AADA from restricting: Truthful,
non-deceptive discount or price advertising; truthful, non-deceptive
advertising concerning the terms or availability of consumer credit;
and truthful, non-deceptive disparaging or comparative advertising. It
would further prohibit AADA from inducing or encouraging any non-
government person or organization from taking an action that violates
the order.
The proposed order would permit AADA to adopt and enforce
reasonable ethical guidelines governing the conduct of its members with
respect to advertising, including unsubstantiated representations, that
AADA reasonably believes would be false or deceptive within the meaning
of Section 5 of the Federal Trade Commission Act.
The proposed order would require AADA to make its Standards for
Advertising Motor Vehicles consistent with the order and revoke any
interpretations that conflict with the order. It would also require
AADA to distribute the order to its members, publish the complaint and
order in its monthly newsletter, file compliance reports, retain
certain documents, and notify the Commission of certain changes in its
corporate structure.
The purpose of this analysis is to facilitate public comment on the
proposed order, and it is not intended to constitute an official
interpretation of the agreement and proposed order or to modify in any
way their terms.
The proposed consent order has been entered into for settlement
purposes only and does not constitute an admission by AADA that the law
has been violated as alleged in the compliant.
Donald S. Clark,
Secretary.
[FR Doc. 94-6536 Filed 3-18-94; 8:45 am]
BILLING CODE 6750-01-M