BEFORE THE FEDERAL TRADE COMMISSION
WASHINGTON D.C.

Comments of National Selected Morticians
to Trade Regulation Rule on Funeral Industry Practices

National Selected Morticians ("NSM") respectfully submits these comments to the Trade Regulation Rule on Funeral Industry Practices ("Funeral Rule" or "Rule"), 16 C.F.R. § 453.1-.9, pursuant to the Federal Trade Commission's Request for Comment published in the Federal Register on May 3, 1999 (64 Fed. Reg. 24250) and July 2, 1999 (64 Fed. Reg. 35965).

Founded in 1917, NSM is a not-for-profit, international trade association of independent, privately owned and operated funeral firms. By charter, its membership consists of "independent funeral service establishments which are privately owned by persons of integrity, good moral character, professional ability of a high type, good financial standing and dedicated to the principle that their calling involves special responsibilities to society. Members shall have an established reputation for honesty and fair dealing and a history of superior service to the public." NSM's 865 member firms comprise 1,400 funeral locations located principally in the United States, and throughout Canada, the United Kingdom, Holland, Germany, Australia and New Zealand. Many of these firms also own and operate cemeteries.

Well before the Federal Trade Commission ("FTC" or "Commission") adopted the Funeral Rule, NSM implemented a Code of Good Funeral Practice, which requires that NSM firms: (1) provide the public with information about funerals, including prices, and the functions, services and responsibilities of funeral directors; (2) quote conspicuously in writing the charge for every funeral offered and identify clearly the services, facilities, equipment and merchandise included in such quotations; (3) furnish each family at the time funeral arrangements are made, a written memorandum of charges, and make no additional charge without the approval of the purchaser; (4) make no representation, written or oral, which may be false or misleading; and (5) apply a standard of honesty in all dealings. Since the Funeral Rule took effect, compliance with the Rule has been an express condition of membership as well.

NSM was a key participant in the original Funeral Rule proceeding, as well as the proceeding that resulted in the 1994 Amendments, and is pleased to have the opportunity to comment on review of the Funeral Rule at this time. On the core questions FTC staff has posed:

· The Definition of Funeral Provider: NSM urges that the FTC expand the scope of the Funeral Rule to all death care providers, by: (1) amending the definition of "funeral provider" to include entities selling funeral goods or services; and (2) amending the definition of "funeral services" to include any person who supervises, conducts or arranges a funeral ceremony or final disposition. The current definitions of "Funeral Provider" and "Funeral Services" restrict the Rule's coverage to traditional funeral homes that "prepare … bodies for burial, cremation or other final disposition." 16 C.F.R. § 453.1(j) (1999). When the Commission adopted the Funeral Rule seventeen years ago, these definitions may have captured most funeral arrangements and funeral goods sales, which in 1982 were the primary province of funeral homes. The competitive landscape for funeral arrangements and sales of funeral goods has exploded since that time. Cemeteries now arrange funerals at on-site chapels or graveside, market cremation services directly to the public from their on-site crematories, and sell all types of funeral merchandise ranging from caskets and urns to vaults and markers. Similarly, casket retailers, "storefront" funeral merchandisers, roving funeral directors, stand-alone crematories and burial vault companies market funeral goods and make full funeral arrangements. Critically, consumers do not distinguish between these different death care providers, but the Funeral Rule does. Because cemeteries, crematories, casket retailers and other providers do not "prepare" the body for final disposition, they do not have to comply with the Rule. Consequently, while these providers arrange funerals, and sell caskets, urns, outer burial containers and other merchandise, they do not have to provide consumers with itemized prices for these goods and services. Nor must they make mandatory consumer protection disclosures, such as the fact that caskets are not required for cremation. Because the very underpinning of the Funeral Rule is to ensure consumers full access to this precise information, the Rule must be expanded to cover these and all other death care providers. Failure to expand the Rule to all segments of the industry vitiates the FTC's rationale for maintaining the Rule altogether.

 

· Casket Handling Fees: NSM does not advocate the allowance of casket handling fees. The 1994 Amendments to the Rule intended to abolish handling fees, and these Amendments should remain in effect. Package discounting, on the other hand, should not be regulated in any way. Discounting, which results in lower overall prices to consumers, is procompetitive and can be measured under existing antitrust laws governing competition. Notably, the United States Supreme Court has unequivocally held in controlling precedent that price discounting benefits consumers absent predatory pricing, and is lawful. The FTC should not and cannot negate this legal antitrust precedent, which already provides the statutory framework and remedy for unlawful pricing practices.

 

· Basic Services Fees: The FTC should not preclude funeral providers from the ability to charge a fee for their basic services. Funeral service is just that - a service - and providers must be able to charge fees for the basic services they render. The funeral industry is not unique in this regard - physicians, attorneys, plumbers, mechanics and hosts of other trades and professions charge basic fees for services. What would be unique is for the FTC to regulate these charges as if funeral providers were in some way franchise monopolies like utility or cable companies. The funeral Rule exists to ensure consumer access to information about services and fees, not to regulate them. To the extent consumers believe a particular firm's service fees are too high, they are free to comparison shop, decline the services and select another firm. The FTC cannot enter the realm of price regulation, which is, has always been and should be the province of market forces.

NSM's comments are more fully set forth below. By separate notice, NSM respectfully requests that it be permitted an opportunity to participate fully in the Public Workshop, as it has in all past FTC Funeral Rule proceedings.

IV. Changes in the Competitive landscape

Since the Funeral Rule was first promulgated in 1982, and since amended in 1994, the funeral industry has undergone a transformation. Over the past several years in particular, independent funeral homes have faced a dramatic increase in competition not only from national conglomerates acquiring other funeral homes, but also from myriad other cross-competitors such as cemeteries, crematories, casket retailers, burial vault sellers and other alternative providers, including the Catholic Church.

The change has been so rapid, "[e]ven those who have handled arrangements recently might not recognize that the business and customs of death are much different today from yesterday, and that tomorrow's practices could be even more unrecognizable." ⁽¹⁾ In short, "it's not the same industry as it was a generation ago, anyway, either for funeral directors or consumers. There are more competitors for a family's death dollars, more choices in commemorating a loved one's passing, more confusion over when and how to plan death arrangements and whom to plan them with." ⁽²⁾

A. Funeral-Service Conglomerates

In 1982, the Commission recognized that "[t]he funeral industry is generally composed of small businesses." ⁽³⁾ That composition has changed, giving way to the continuing and increasing trend of corporate consolidation in the industry. Leading the consolidation movement are three large, conglomerate funeral-service corporations:

· Service Corporation International (SCI), the largest funeral services company in the world, operating 3,442 funeral homes in 20 countries. SCI employs over 40,028 individuals and its total annual revenues exceed $2.9 billion; ⁽⁴⁾

 

· The Loewen Group is the second largest funeral-services provider in the world, operating more than 1,115 funeral homes. Loewen's 1998 total revenues exceeded $1.1 billion; ⁽⁵⁾ and

 

· Stewart Enterprises, the third largest funeral-services provider, with 575 funeral homes in North America, South America, Europe and the Pacific Rim. Its 1998 total revenues reached $648.4 million. ⁽⁶⁾

As recently as 1996, these three companies accounted for 36% of all funeral revenues in the United States. ⁽⁷⁾ And of the 22,156 funeral homes in this country, more than 22%, are now owned by the four largest firms - SCI, Loewen, Stewart and Carriage Services, Inc. ⁽⁸⁾

Significantly, the funeral service conglomerates are not limited in operations to funeral homes: SCI currently operates 433 cemeteries and 191 crematories; Loewen operates 427 cemeteries; and Stewart has 143 cemeteries. ⁽⁹⁾ The same funeral goods and services sold by conglomerate funeral homes are not covered by the Funeral Rule when sold through these cemeteries and crematories.

A. Cemeteries

Cemeteries have transformed in recent years from sellers of burial plots to one-stop, full-service funeral providers, competing against funeral homes for sales of every conceivable funeral good. ⁽¹⁰⁾ "They sell vaults, monuments, family mausoleums, urns, plaques and . . . caskets in order to raise funds to improve their facilities or the bottom line, and they compete fiercely to convince consumers they're the best ones to buy from." ⁽¹¹⁾

In addition, cemeteries are now arranging funerals - offering ceremonial services both graveside and at on-site chapels, on a pre-need as well as at-need basis. ⁽¹²⁾ These funeral arrangements can be virtually indistinguishable from those offered by traditional funeral homes. As recognized by the executive director of a cemetery association in Pittsburgh, "'Our role has expanded - we've probably had more change in the last 10 years than in the first 40.'" ⁽¹³⁾

Similarly, the Catholic Church, traditionally involved in the cemetery business, has increasingly been moving into the funeral side of death care through its widespread cemetery holdings. Among the services being marketed by the Catholic church are: "interment related services, such as grave, crypt or niche spaces, vaults, markers or monuments, memorial installation services, grave or crypt decorations, cremation services from an on-site crematory, urns and cremation related products, and funeral services from an on-site funeral home." ⁽¹⁴⁾ The church intends to be involved in all aspects of funeral services "from the physical preparation of the body to the completion of the committal service at the Catholic cemetery." ⁽¹⁵⁾ Ideally, the Catholic church wants to provide its members "the necessary facilities, vehicles and staff to meet with families, arrange and coordinate the funeral and burial arrangements, and in conjunction with the parish priest or lay administrators, arrange for transportation of the deceased to the appropriate parish to conduct the funeral Mass and liturgy." ⁽¹⁶⁾

The nonprofit Los Angeles Roman Catholic Archdiocese, the largest in the country, took large steps toward this goal earlier this year, contracting with conglomerate Stewart to build and manage funeral homes at church cemeteries. "As part of the contract, Stewart will build funeral homes at the tax-exempt cemeteries for one-stop embalming, casketing, chapel service and burial." ⁽¹⁷⁾ The "funeral homes will bear the cemetery names." The Archdiocese operates eleven cemeteries in Southern California and two in Arizona. ⁽¹⁸⁾

There are currently 100,000 public, private, military and religious cemeteries in the United States, actually competing or poised to compete with funeral firms in every respect, for funeral goods and services. ⁽¹⁹⁾ Cemeteries are not covered by the Funeral Rule.

B. Crematories

There were 541,163 cremations in the United States in 1997, which translates into a 23.6% cremation rate. By comparison, in 1965 less than 4% of the people who died were cremated. ⁽²⁰⁾ It is expected that by 2007, the cremation rate in the U.S. will rise to almost 30%. ⁽²¹⁾ Not surprisingly, there has been a parallel increase in the number of crematories in the United States, from only 585 in 1980, to 1,256 in 1997, an increase of more than 100% in 17 years. ⁽²²⁾ With the increase in cremations and concomitant expansion of crematories have come increased opportunities for crematories to interact with, and compete for, funeral consumers.

One notable example is The Neptune Society, which bills itself as "the nation's largest and most successful cremation services company." ⁽²³⁾ Headquartered in Los Angeles, with offices in California, Florida and New York, The Neptune Society performs all the services of a traditional funeral home: "we immediately take care of all details of removal, filing death certificates, cremation and final disposition," and "can provide . . . private memorial services, chapel services, or formal sea services." ⁽²⁴⁾ Succinctly, The Neptune Society is "offering a cremation chain across the country." ⁽²⁵⁾

This national cremation chain, moreover, is not limited to arrangements at the time of death: "The Neptune Society has, in addition to traditional cremation services, initiated a pre-need program which guarantees fixed-price cremation funeral services." ⁽²⁶⁾ This "program . . . has attracted over 50,000 active pre-funded pre-need members . . ., and in 1997 alone, Neptune provided alternative services to 4,943 customers and entered into 6,309 pre-need contracts with new members." ⁽²⁷⁾ Since beginning business in 1973, The Neptune Society "has handled over 70,000 individuals." ⁽²⁸⁾ None of these past or present at-need or pre-need transactions, or similar funeral arrangements by any other crematories, are subject to the price and consumer protection disclosures of the Funeral Rule. ⁽²⁹⁾

C. Casket Retailers

In what has been described as a "Macy's-like setting," direct casket retailers have surged into the death care market in recent years. ⁽³⁰⁾ New entrants are commonplace. White Light, a Dallas-based company, offers creative art caskets decorated with everything from the Irish Flag to a golf green. This niche company, in operation since October 1998, expects to sell more than 4,000 of the colorful coffins ranging from $2,500 to $2,900 each. ⁽³¹⁾ Casket Sales & Garments opened a burial casket and clothing store in a South Carolina shopping mall in July 1998. ⁽³²⁾ Sweet Earth Casket Shop and MHP Enterprises, in addition to traditional caskets and casket-kits, market and sell casket furniture, convertible at death for funeral use. ⁽³³⁾

Other casket retailers target consumers who have decided to take a "do-it-yourself" approach to funeral service. Carpenter Homemade Casket Plans markets a "build it yourself" casket for "those willing to supply the wood and the work." ⁽³⁴⁾ The homemade caskets, which double "as fine furniture until needed," are designed "to function as a simple alternative to manufactured caskets." ⁽³⁵⁾ Another company, BioFab, is marketing a biodegradable rice straw coffin that can be assembled at home for $325. ⁽³⁶⁾

Significantly, casket retailers do not limit their funeral service activities to casket sales alone. Consumer Casket USA, for example, self-described as "America's Leading Retail Casket and Funeral Merchandise Stores," markets pre-need funeral arrangements under a program it calls "Plan 4." ⁽³⁷⁾ This "Advance Planning" program "is designed to incorporate your desires, and to have every element ready at the time of need." ⁽³⁸⁾

There are currently several hundred direct casket retailers in the United States competing with cemeteries, crematories and funeral homes. ⁽³⁹⁾ None of the casket retailers are subject to the consumer protection disclosures and requirements of the Funeral Rule.

D. Alternative Arrangers

Filling out the service segment of the industry are alternative providers who supervise, conduct and arrange unique funeral service alone. Celebrate Life, for example, will arrange and conduct a fireworks ceremony for cremated remains to music of choice for about $3,250.00. ⁽⁴⁰⁾ Similarly, Houston-based Celestius will launch cremated remains in a small rocket, for orbit around the earth and eventual re-cremation on return to the atmosphere. ⁽⁴¹⁾ These types of arrangers no doubt sell unique funeral goods, but primarily are service providers. They are not subject to any requirements of the Funeral Rule.

IV. The rule must be exPANDED to cross-competitors

The recent transformation of the competitive landscape in the funeral industry has left consumers unprotected. Large segments of the industry - including cemeteries, casket retailers, crematories and others - cross-competing with funeral homes for the same goods and services are not covered by the Funeral Rule, and in many states are not regulated at all. Given the new face of the death care industry, and the Commission's stated rationale for the Rule in the first instance, the Rule must be expanded to cover all providers of funeral goods or services.

From the very beginning, the express purpose of the Rule has been "to lower existing barriers to price competition in the funeral market and to facilitate informed consumer choice." ⁽⁴²⁾ To achieve these goals, the Rule was designed to ensure that consumers (i) are given timely access to price and other important information, (ii) are not required to purchase unwanted goods and services, and (iii) are not influenced in their purchasing decisions by misrepresentations. ⁽⁴³⁾ These statutory goals cannot be met absent expansion of the Funeral Rule to all death care providers.

A. Economic Considerations

In a separate economic statement supporting expansion of the Funeral Rule, Robert D. Tollison, Director of the FTC Bureau of Competition when the Commission adopted the Rule, explains the Rule's economic underpinnings: "[t]he FTC enacted the [Funeral Rule] in 1984 in response to its perception that the funeral consumer is vulnerable to exploitation due to unique circumstances under which the consumer must make his/her purchase decision." ⁽⁴⁴⁾ As Dr. Tollison succinctly frames the issue: "[t]he consumer is either vulnerable or not; regulation is either called for or not." ⁽⁴⁵⁾ Equally direct is his conclusion: "[i]f the intent of the Rule is to protect vulnerable consumers in their purchasing decisions, then economic efficiency dictates that all suppliers of these goods and services must be subject to the same regulations." ⁽⁴⁶⁾

This conclusion is uncontestable. "The primary objective of the Funeral Rule is to allow a consumer easy access to comparable price information. Lack of the Rule's expansion to other providers offering the same or similar goods and services thwarts this purpose." ⁽⁴⁷⁾ In economic terms:

High information costs prevent the consumer from discovering another firm's prices efficiently. This allows the suppliers to charge supracompetitive prices even when there are a large number of competitors in the market. At the same time high information costs prevent the consumer from knowing that he is being injured because gathering comparable price information is costly.
* * *
Unregulated competitors can engage in sales techniques that deliberately obfuscate qualitative differences among goods and hinder the consumer's ability to comparison shop. There is no obligation to offer a metric to allow proper comparison to a funeral home's GPL. Without a common metric, non-traditional retailers can offer prices for similar, but qualitatively inferior goods, at inflated prices. This could confuse the inexperienced consumer and lead to purchases that would not have been made had all information been known. ⁽⁴⁸⁾

The potential "confusion" Dr. Tollison mentions is the very confusion that the media frequently report currently exists in the multi-faceted death care market today. ⁽⁴⁹⁾ On the other hand, "[e]xpansion of the Rule to all providers of funeral services will facilitate comparison shopping across all retailers through the provision of a common metric of price information." ⁽⁵⁰⁾

In addition, as Dr. Tollison points out, partial regulation results in competitive market distortions. The current limited scope of the Funeral Rule, according to Dr. Tollison, "can be thought of as a tax on the funeral homes that is not imposed on its competitors." ⁽⁵¹⁾ This "tax will force marginal producers of goods and services to sell through the unregulated channel to avoid the additional costs of regulation." ⁽⁵²⁾ The result is harmful to the competitive process as well as consumers. "First, the Rule is thwarted as those individuals who profit most from fraudulent activity redefine their business to circumvent the Rule. … Providers of funeral goods and services with an incentive to deceive or defraud customers will operate in the unregulated sector of the industry, thus avoiding the requirements preventing consumer harm in the regulated segment of the market." ⁽⁵³⁾

From the standpoint of competition, "the burden of educating the public on the different items of a funeral falls wholly on the traditional funeral provider while the benefits of such education fall on unregulated fringe competitors of funeral goods." ⁽⁵⁴⁾ This burden "raises the cost of being a regulated provider and at the same time it raises the benefits of being unregulated," encouraging "entry into the unregulated sector and exit from the regulated sector." ⁽⁵⁵⁾ This "shift," as Dr. Tollison calls it, "is artificial, induced solely by regulation. Expansion of the Rule would mitigate such superficial shifts, and would allow the cost of education to be dispersed among all the players in the market." ⁽⁵⁶⁾

B. The Industry Record

Dr. Tollison's conclusions are supported by a quick glance at the record for the cemetery sector alone:

· A 1996 AARP study reported that 52% of cemeteries surveyed failed to provide price information to older consumers arranging funerals. ⁽⁵⁷⁾ Similarly, nearly 40% of cemeteries recently surveyed by the Commonwealth of Virginia admitted they did not "provide a written general price list of all services and merchandise to potential purchasers;" ⁽⁵⁸⁾

 

· Many cemeteries are charging a handling or "servicing" fee - similar to casket handling fees the Commission banned in 1994 - when "outside" vaults and liners are brought into the cemetery; ⁽⁵⁹⁾

 

· Where cemeteries do not charge installation or handling fees, many impose requirements regarding indemnity, installation and handling together with insurance certificates naming the cemetery as beneficiary, that make it impracticable for any business other than the cemetery to sell or install the vault; ⁽⁶⁰⁾

 

· Cemeteries similarly charge "administrative" or "document preparation" fees for undisclosed and undefined work; ⁽⁶¹⁾

 

· There has been a 300-500% rise in the cost of various cemetery "opening and closing" fees, which can be undisclosed and non-declinable; ⁽⁶²⁾

 

· Cemeteries are requiring that consumers purchase double-depth graves for two people, without giving the option of a single grave for one person; ⁽⁶³⁾

 

· Although no state or federal law requires the use of grave liners, cemeteries often require that consumers purchase liners; ⁽⁶⁴⁾

 

· Some cemeteries require that families purchase urn vaults for the interment of cremated remains (one family was told this was required by the EPA as a health precaution); ⁽⁶⁵⁾ and

 

· Despite the fact that funeral homes must inform consumers of the minimum alternative containers available for cremation under the Funeral Rule, many cemeteries are refusing to accept these options, arbitrarily insisting on more expensive, composition board cremation containers, rather than the less expensive cardboard container options funeral homes have been providing consumers for decades. ⁽⁶⁶⁾

Compounding these practices are cemetery hard-sell tactics. SCI's cemetery training literature, for example, called a "Prospecting Script," proposes a sales pitch called "Setup for the Hook" parts I and II, alluding to undefined "legal responsibilities" a family would be "faced with where cremation is concerned." ⁽⁶⁷⁾ Also notable is a classified advertisement for a cemetery "Sales Opportunity:" "seeking 1-2 ambitious sales persons with desire to earn high income." ⁽⁶⁸⁾ The West Virginia Attorney General recently launched an investigation into the door-to-door sales tactics of Loewen cemeteries in the state, alleging that the "Loewen cemeteries have misled consumers with false advertising about funeral goods." ⁽⁶⁹⁾

Some cemeteries, moreover, have undertaken casket sales that violate state inventory laws. In Michigan, for example, "a handful of unscrupulous cemeteries" sold consumers "warehouse tickets" assuring delivery rights to caskets upon death. ⁽⁷⁰⁾ The state audited the cemetery casket stock, and six of the eight "had less than 45 percent of the caskets that were required to be stored." ⁽⁷¹⁾

Consumers purchasing goods and services from cemeteries on a pre-need basis are equally vulnerable. An article in Consumers Digest reports of a cemetery consumer who was pressured into signing a pre-need contract with a local cemetery in suburban Detroit. A cemetery salesman, offering no brochure or sales materials, scribbled down three handwritten offers and pressured her into signing up in one day. ⁽⁷²⁾ It is hardly conjecture to presume the scribbled, handwritten offers did not contain itemized price or consumer protection disclosures, mandatory under the Funeral Rule GPL. Nor is it likely this consumer received an itemized statement of charges.

As one recent article states point blank: "[c]emeteries work aggressively to sell final arrangements years in advance - leapfrogging funeral directors for the first crack at customers' checkbooks - and build their own funeral homes to market themselves as a one-stop shopping benefit to families." ⁽⁷³⁾ It is therefore hardly surprising that Virginia, for example, recorded 172 complaints about cemeteries since the summer of 1995, finding "dramatic" increases in complaints about "costs and dissatisfaction with expenses." ⁽⁷⁴⁾ There is simply no economic, legal or policy justification to omit cemeteries from the consumer protection requirements currently applicable to the funeral homes cemeteries are "leapfrogging."

Nor should any other cross-competitor escape the Funeral Rule's protections. Take for example Casket Royale, a casket retailer based in Hampton Falls, N.H., with more than fifty dealers and distributors across the country and sales in the millions of dollars. ⁽⁷⁵⁾ Casket Royale currently runs advertisements alluding to a mysterious "new federal law which allows you to purchase your casket at wholesale prices." ⁽⁷⁶⁾

Notably, the National Casket Retailers Association's Executive Director, recognizing casket stores "are not presently included in the Rule," nevertheless says those retailers "already do everything required by it and have no objection to being included." ⁽⁷⁷⁾ Similarly James St. George, President and CEO of Consumer Casket USA, advocates expanding the Rule to cover all cross-competitors:

We also believe that some form of regulation today will prevent any potential long-term impairment to any consumer. In this way, the consumer will be guaranteed truthful information and affordable pricing on traditional funeral and memorial items through healthy competitive competition no matter the forum they choose. . . . .[T]o effectively cover this greater good of all consumers, [the Rule] must be strengthened and broadened in scope to cover any and all entities that expose themselves to the general public as sellers of these wares. ⁽⁷⁸⁾

C. Agency Precedent

Extending consumer protection regulation to new industry participants outside the coverage of pre-existing rules is not a novel concept to the Commission. Just this past year, the Commission amended its "900-Number Rule," which covers providers of "pay-per-call services," in light of the legal, technological and marketplace changes that took place after the 900-Number Rule was first promulgated in 1993. 63 Fed. Reg. 58524 (1998). Specifically, the Commission expanded the rule to capture audiotext services - such as certain 800 numbers, international numbers, and other dialing patterns that do not use the 900-number prefix - which fell outside the original definition of "pay-per-call services:"

The Commission believes these revisions are necessary in order to ensure that technological innovations in the telecommunications industry do not undermine the rights of consumers or otherwise operate to destroy the credibility and confidence that consumers and vendors have come to expect from the legitimate pay-per-call industry.

[T]he Commission believes the proposed modifications are necessary to ensure that the Rule fulfills the Congressional mandate in TDDRA that the FTC encourage the growth of the legitimate audiotext industry, while curtailing those practices that are abusive, unfair or deceptive, that evade the 900-Number Rule, or that undermine the rights of consumers. . . . The Proposed changes are made . . . to extend the definition of "pay-per-call services" to cover similar audio information and entertainment services that are susceptible to the unfair or deceptive acts or practices prohibited by the 900-Number Rule.

63 Fed. Reg. 58526-27 (footnotes omitted). NSM's request that the FTC expand the Funeral Rule to cover industry segments which currently escape coverage fits this legal precedent.

D. Proposed Amendments

To adequately expand the Rule, NSM proposes two amendments. First, the definition of "Funeral Services" at 16 C.F.R. § 453.1(j) should be amended as follows:

"Funeral services" are any services which may be used to: (1) care for and prepare deceased human bodies for burial, cremation or other final disposition; and or (2) arrange, supervise or conduct the funeral ceremony or the final disposition of deceased human bodies.

This amendment would bring cemeteries, crematories such as The Neptune Society, or other cross-competitors such as Celebrate Life or Celestius, that may or may not "prepare" remains for final disposition, but which otherwise supervise, arrange and conduct funeral ceremonies and final disposition of the body, within the Rule.

Second, NSM proposes that the definition of "Funeral provider" in § 453.1(i) be amended to cover "any person, partnership or corporation that sells or offers to sell funeral goods and or funeral services to the public." This change will bring cross-competitors such as casket retailers, which may not offer services, but who otherwise sell funeral goods subject to the Rule's disclosures, within the Rule's requirements.

Succinctly, these two straightforward amendments will remedy the historically accidental, partial regulation that now exists, bringing all segments of the death care industry under the same requirements, effectuating the original economic, legal and policy intentions of the Rule, and leveling the playing field - for consumers and the trade. ⁽⁷⁹⁾

E. If Not Expanded, the Rule Must Be Sunsetted

Should the Commission decide against expansion of the Funeral Rule, the decision would by necessary implication completely vitiate any reason to continue the regulation. Dr. Tollison's succinct reasoning again makes the point on two levels. First, from the standpoint of access to information underlying the economic underpinnings of the Rule:

If the market is producing the information necessary to prevent the need for regulation of close competitors of funeral homes, then there is no need for regulation of funeral homes. It is information that eliminates the potential for harm to the funeral consumer. If full information increases consumer welfare, then requiring full information from all providers of funeral goods and services will further enhance consumer welfare, given the relatively low costs of compliance. If not, then it is economically illogical to argue that only requiring full information from some market participants enhances consumer welfare. ⁽⁸⁰⁾

And from the consumer vantage point:

Consumers are no less vulnerable to potential abuse by non-regulated providers of the goods and services than by providers who "prepare the body." If the FTC finds no potential consumer harm due to misrepresentation and lack of price information for comparable goods and services when the funeral consumer purchases through the non-regulated providers, there cannot be any potential harm from funeral home providers. ⁽⁸¹⁾

In short, "[if] there is no economic justification in terms of enhancements of consumer welfare for extending the Rule to all providers of funeral goods and services, there can be no valid economic justification for retaining the Rule." ⁽⁸²⁾ Nor is there any legal justification. By 2002, the Funeral Rule will have been in place for twenty years, more than a sufficient amount of time for any remedial affirmative disclosures, which are extreme remedies that must be strictly construed, narrowly tailored and limited in scope and duration. See, e.g., In re AHC Pharmacal, Inc., 101 F.T.C. 40, 1983 FTC LEXIS 118, at *10 (Feb. 3, 1983) (order modifying corrective advertising requirements of consent decree based in part on "passage of time" since misleading statements in 1983).

In 1994, moreover, the Commission voted to continue the Rule's affirmative disclosure requirements citing the lack of compliance in the industry. That lack of compliance is no longer the case, as the FTC sweeps show compliance in the near 90% range across the country since 1996, and in many states, at the 100% level. ⁽⁸³⁾

Sunsetting the Rule, on a final note, would not leave consumers unprotected. Dramatically enhanced free flow of ideas and the availability of information in the new electronic age substantially diminish even the potential for deception the Commission never found widespread in the first instance. Purchase patterns in the industry itself, furthermore, present safeguards against deception. Of more than 350,000 families responding to NSM's Family Follow-Up Survey since 1988, 59%-60% consistently state that they choose a funeral home based on reputation, past experience or recommendations. ⁽⁸⁴⁾ Deceptive tactics defeat this primary selection criteria by consumers, and naturally would result in lost business. And increasing industry regulation by the states, as well as existing state tort and contract laws, present ready-made legal remedies for aggrieved consumers, as do the antitrust laws for disgruntled competitors.

V. package discounting is pro-competitive

The Commission has invited comments regarding the casket handling fee prohibition, and the related issue of package discounting. NSM agrees with the Commission's handling fee prohibition, but vehemently defends the pro-competitive practice of offering consumers lower prices through package discounting.

As the Commission recognizes in its Request for Comment, the Rule does not prohibit the offering of funeral packages. Indeed, the Commission has expressly interpreted the Rule to allow "funeral packages, as long as they are offered in addition to, not in place of, itemized prices." ⁽⁸⁵⁾ And the Commission's stated rationale for this interpretation is fully applicable today: "if there are any savings in packages, they can be passed on to those consumers who are interested in package prices. Consumers who are not interested in packages may have to pay somewhat more in order to buy on an itemized basis, but that is their choice." ⁽⁸⁶⁾

The Commission's longtime stance on this issue, moreover, is consistent with the 1994 decision by the United States Court of Appeals for the Third Circuit, which expressly held package discounting "is a method used to deal with competition from third party casket sellers which is pro-competitive." Pennsylvania Funeral Directors Ass'n v. FTC, 41 F.3d 81, 90 (3^d Cir. 1994). The Court correctly contrasted pro-competitive discounting with handling fees: "[t]he [casket handling] fee essentially requires consumers to buy their caskets from funeral homes, or pay for it anyway. The other methods (e.g., discounts) represent a way to encourage consumers to buy their caskets from funeral homes." Id. at 90.

Critically, both the Commission's interpretation and the Third Circuit's decision fit currently controlling Supreme Court precedent addressing competition through price discounting in the antirust context, which governs complaints by competitors about pricing: "[l]ow prices benefit consumers no matter how those prices are set, and so long as they are above predatory levels, they do not threaten competition." ARCO v. USA Petroleum Co., 495 U.S. 328, 340 (1998) (emphasis added). Under this holding, funeral package discounts benefit consumers no matter how those discounts are set, and a competitor simply has no grounds to complain about lost business resulting from these package discounts:

a firm cannot claim antitrust injury from nonpredatory price competition on the asserted ground that it is "ruinous." The statutory policy precludes inquiry into the question whether competition is good or bad.

ARCO, 495 U.S. at 339 n. 7.

In short, there can be no question that discount funeral packages enhance consumer welfare, and to the extent package discounts reduce prices in order to retain or capture business from a rival - whether it be other funeral homes, casket retailers, crematories or cemeteries -- these discounts are the very essence of competition that the antitrust laws are designed to protect and encourage. ARCO, 495 U.S. at 340. The FTC should not and cannot pursue price regulation that reverses Supreme Court antitrust precedent.

The Commission's Request for Comments suggests that, in some instances, funeral providers offering package discounts may be inflating the itemized prices "to the point of fictitiousness . . . resulting in a situation where the discount package represents de facto prices for the goods and services." ⁽⁸⁷⁾ First and foremost, NSM is not aware of instances where this practice has occurred. More importantly, to the extent that any funeral providers engage in such practices, the Rule's requirement of price itemization and disclosure will expose inflated prices, and enable consumers to comparison shop. Again, the Funeral Rule exists to ensure consumer access to price information. As the Commission has stated repeatedly: "The rule does not regulate how funeral directors determine prices." ⁽⁸⁸⁾

VI. The basic services fee

NSM strongly supports a funeral provider's uncontestable right to charge a fee for the services rendered. Section 453.2(b)(4)(iii)(C) of the Funeral Rule currently guarantees this right, allowing a funeral provider to charge consumers for the professional services required to arrange and plan the funeral or disposition, including:

· conducting the arrangements conference;

 

· planning the funeral;

 

· obtaining necessary permits and authorizations (such as cremation or burial permits);

 

· placing obituary notices;

 

· consulting with family or clergy;

 

· sheltering the remains; and

 

· preparing and filing necessary notices (such as the death certificate). ⁽⁸⁹⁾

No argument can be put forth as to why a funeral director must perform these critical, essential and absolutely necessary services without charge. Although delineated on the GPL simply as Basic Services, it appears the FTC's classification of these charges as "non-declinable" can result in the unintended and unwanted effect of causing consumers to believe they are being "forced" to pay for services without a choice, placing funeral providers in a defensive posture over legitimate services that, in most cases, consumers would understand.

NSM nevertheless believes resolution to this sensitivity lies with proper explanation and understanding of the charge, not abolition. Funeral providers must retain the right to charge fees for their basic services, and remain free to refuse to serve clients who do not elect to pay for these services. Funeral service is just that - a service - and providers cannot be compelled to give that service away.

VII. REvisions to the General Price list

The FTC Request for Comment identifies certain revisions to the General Price List ("GPL") suggested by the Funeral and Memorial Societies of America ("FAMSA"). In addition, NSM respectfully asks that the Commission reconsider the current timing triggers for price disclosures under the Rule.

A. The Timing Requirement for Disclosure of the GPL Should Be Amended

Under the current Rule, funeral providers must give the GPL to consumers upon beginning discussion of prices, the overall type of funeral service or disposition, or specific funeral goods or funeral services. 16 C.F.R. § 453.2(b)(4) (1999). Notwithstanding the Commission's 1994 "clarification" of this timing obligation, the everyday reality in the industry is that the provision as written requires GPL disclosures to be the first communication funeral providers offer grieving consumers.

To avoid the appearance of insensitivity and preoccupation with money at a very delicate and vulnerable time for consumers, and to avoid the loss of funeral provider goodwill, NSM proposes that the Rule be amended to trigger the GPL statements and disclosures "prior to any selection or determination" of funeral goods or arrangements. This simple amendment ensures that consumers receive price and service options early in the selection process, and critically, before any decisions are made, serving the Rule's goal of informed consumer choice, while at the same time allowing some flexibility for the compassion required of the profession and expected by consumers.

The Commission, in fact, acknowledged these sensitivities in connection with its repeal of mandatory telephone disclosures in 1994:

Consumers who call to first arrange a date and time for a funeral service, however, or who request the removal of remains, likely expect an empathetic response, and may be seriously offended by the uninvited offer to discuss prices. Some consumers in that circumstance are likely to interpret the affirmative disclosure as an indication of an unwarranted provider concern with the consumer's ability to afford services. The provision's likely inability to benefit consumers does not justify the imposition of such undue awkwardness and potential offense in what is otherwise an extremely delicate business, social and personal transaction. ⁽⁹⁰⁾

During the short interval between an initial telephone call and the first in-person meeting with a funeral provider, the psychological state of the funeral consumer undergoes little if any change. In fact, in-person contact may very well be the first communication with a client. Thus the need for empathy and the potential for offense attendant to the initial telephone call are just as prevalent at the initial meeting.

Although the Commission sought to address this issue in 1994 through certain clarifications, it ultimately declined to revise the Rule, based in large part on "the empirical evidence on the level of providers' compliance with the current GPL requirements (23% give the GPL at the outset of arrangement discussions) . . ." ⁽⁹¹⁾ Compliance with the GPL requirements currently stands in stark contrast to the evidence available to the Commission in 1994. Of the 668 funeral homes surveyed as part of the FTC "Sweeps" in 1996, 1997 and 1998, almost 90% - 589 homes - were found to be in compliance with the Rule. ⁽⁹²⁾ (On a similar note, the 1997 Gallup poll measuring consumer perceptions of twenty-six professions ranked funeral directors seventh highest in consumer impressions of honesty and ethics.) ⁽⁹³⁾

The Commission's attempted 1994 clarifications, moreover, have not alleviated the requirement that funeral providers communicate the GPL disclosures and statements to grief-stricken consumers often when they first walk in the door. Consider the following real life examples of common initial consumer questions that trigger the disclosure requirements under the Rule:

· A daughter whose mother has just died in a nursing home visits a funeral home in person and asks how quickly her mother can be cremated and how quickly she can obtain the ashes. Before the funeral provider can answer these questions, he must provide the customer with the GPL and explain why. No doubt this disclosure would leave the consumer with the impression the provider cares more about money than her funeral needs;

 

· An uncle visits a funeral provider, because his nephew has died in a tragic accident, and his sister is too distraught to deal with the situation. He asks the funeral provider how they can get the body back. The funeral provider can help, of course, but only after making GPL price disclosures to the consumer, putting the insensitivity of price over the compassion and assistance the Uncle needs and deserves;

 

· A funeral provider asks the simple question to an in-person customer, "tell me what your needs are" or "how can I help?" No matter what the answer, price is certain to be the next topic under the current timing requirements of the Rule.

Given these examples, it is easy to understand how immediate GPL disclosures often lead consumers in many instances to believe the funeral provider is more concerned about money than assisting the family, and can adversely impact families at an emotional time.

NSM's proposed amendment will in no way harm consumers, who will still receive all disclosures and the GPL in the form currently required, prior to any selection, decision or agreement on price or options, and at the same time will allow funeral providers to avoid distressing protocol at the outset of meeting a family. Moreover, the GPL's purpose of providing ready price and service options information for consultation while consumers are considering what goods to purchase, before they make selections, would be achieved.

B. No New Items Should Be Added to the Required Itemization on the GPL

NSM does not believe it would be beneficial to consumers or funeral providers for any additional fees, prices, goods or services to unnecessarily cloud the already dense GPL. The current GPL more than adequately identifies items and prices available for selection by consumers. The additions suggested by FAMSA add no further clarity.

Price for Private Viewing without Embalming

First and foremost, many funeral providers allow families a private viewing without embalming free of charge. Adding an itemization for this event will therefore create a charge for a service that in many instances is currently free.

To the extent that FAMSA insists there should be a charge for Private Viewing without Embalming, this charge could be determined from the itemized GPL, which already contains line items for "Use of Facilities and Staff for Viewing" separate and apart from "Embalming."

Price for Body Donation to Medical School

Again, this FAMSA proposal requests itemized disclosure for an event that in many instances does not result in any expense to the customer. For those cases where there are charges associated with medical donations, the current GPL already contains sufficient categories in which these charges are itemized.

Price for Cremation

NSM does not support FAMSA's proposal for a new itemization on Cremation. The price for cremation is already included in the current GPL itemization for "Direct Cremation," or as a Cash Advance item. FAMSA's request that this charge be broken out further would only result in unnecessary additional clutter with no added information not already contained in the GPL as structured.

Price for Casket Rentals

Some states prohibit casket rentals for health reasons. In those states that allow rentals, NSM does not oppose itemized price disclosure on the GPL as recommended by FAMSA.

VIII. conclusion

For the foregoing reasons, NSM respectfully urges that the Commission: (1) expand the Funeral Rule equally to all segments of the industry;" (2) maintain the Rule's prohibition on handling fees and continue to allow procompetitive package discounts, which lower prices to consumers; (3) in no way regulate prices or a funeral provider's right to charge for essential "Basic Services" currently specified in the Rule; (4) amend the GPL timing trigger for price disclosures to "prior to any selection or determination" of funeral goods or services; and (5) decline any requests to further breakdown itemizations already included in the GPL.

Respectfully submitted,

HOWREY & SIMON

By:

 ________________________________
Michael P.A. Cohen
Howrey & Simon
1299 Pennsylvania Ave., N.W.
Washington, D.C. 20004
202.783.0800 (phone)
202.383.6610 (fax)

Attorneys for NATIONAL SELECTED MORTICIANS

Exhibits

1. Gary Rotstein, Final Arrangements: A Time of Reckoning for the Region's Funeral Trade, Pittsburgh Post-Gazette, May 23, 1999, at 1. For volume sake, NSM has not attached media articles as Exhibits, but would be pleased to provide the Commission with any article upon request.

2. Id.

3. 47 Fed. Reg. 42260, 42263 (1982).

4. SCI Form 10K Filing with the Securities & Exchange Commission, Mar. 31, 1999 [hereinafter "SCI 10K"].

5. Loewen Group Form 10K Filing with the Securities & Exchange Commission, Apr. 14, 1999 [hereinafter "Loewen 10K"].

6. See Stewart Enterprises, Inc. Form 10K Filing with the Securities & Exchange Commission, Jan. 21, 1999 [hereinafter "Stewart 10K"]; Exhibit 2 (Business Trend Analysts, Inc., The U.S. Market For Funeral And Cremation Services And Supplies 192 (1998)) [hereinafter "Business Trends Analysts Report"].

7. United States Census Bureau, Service Annual Survey 1996, Table 3.1.

8. See, SCI 10K; Loewen 10K; Stewart 10K; Microsoft Investor, http://investor.msn.com/research/snapshot.asp?Symbol+CSV (Carriage Services, Inc. rank and number of funeral locations); Microsoft Investor, http://investor.msn.com/research/snapshot.asp? Symbol = EQU (Equity Corporation rank and number of funeral locations) (the FTC approved SCI's acquisition of ECI earlier this year). "There is evidence to suggest that where corporate chains gain a dominant market share, overall prices climb." John F. Wasik, Fraud in the Funeral Industry, Consumers Digest 59 (Sept./Oct. 1995). For example, Consumers Digest reports that funeral prices doubled in Dallas, Texas as a result of consolidation, and in Houston, where SCI performs 7,000 funerals each year versus several hundred by independents, "the cost of a funeral ranges from $8,000 to $14,000 - which makes the city one of the most expensive places to die in the nation . . ." Id. at 59.

9. See SCI 10K; Loewen 10K; Stewart 10K.

10. See Exhibit 3 (Olivet Memorial Park Adult Casket Price List and Alternative Containers); Exhibit 4 (Davenport Memorial Park Marketing Brochure); Exhibit 5 (Newport Memorial Park Price List); Exhibit 6 (Cemetery Retail Installment Contract and Security Agreement).

11. Gary Rotstein, Final Arrangements: Cemeteries Must Compete for Consumers, Pittsburgh Post-Gazette, May 25, 1999, at 2.

12. See Exhibit 7 (Laurelwood Cemetery Co. Pre-Planning Guide); Exhibit 8 (Davenport Memorial Park brochure for information on "Caskets," "Cremation Options" and "Funeral Service"); Exhibit 5 (Newport Memorial Park price list for entombment including "Full Chapel Service"); Exhibit 8 (Alleghany Memorial Park Grave Opening Fees "With Chapel"); Exhibit 6 (Cemetery Retail Installment Contract and Security Agreement).

13. Rotstein, supra note 1, at 2.

14. See Exhibit 9 (National Catholic Cemetery Conference, The Catholic Cemetery, A Vision for the Millenium, 1997, at 22 (quoting Annabelle McGannon, Executive Director, Catholic Cemeteries Association of the Pittsburgh Catholic Diocese)).

15. Id. at 47.

16. Id. at 49.

17. Archdiocese to Open Funeral Homes at Church Cemeteries, The Desert Sun, May 2, 1995, at A5.

18. Id.

19. Wasik, supra note 8, at 54.

20. See Exhibit 2, supra note 6 (Business Trends Analysts Report).

21. Id.

22. Id. at 22.

23. See Exhibit 10 (www.neptunesociety.com, Neptune Society Web Page).

24. Id.

25. New Ownership Means New Beginning for Neptune Society, Death Care Business Advisor, July 27, 1999 [hereinafter "Death Care Business Advisor"].

26. See Exhibit 10, supra note 23 (Neptune Society Web Page).

27. Id. The Neptune Society's pre-need trust now totals more than $38 million. "Estimates for the fund reach $86 million by 2004." Id.

28. Id.

29. The Neptune Society has "run afoul of California regulators for co-mingling the remains of different people and dumping ashes into a ditch instead of the ocean." Death Care Business Advisor, supra note 25, at 6. And in 1998, "regulators found two dozen decomposing bodies at the Los Angeles crematorium." Id.

30. Caskets To Go, Sacramento Bee, Oct. 10, 1997, at G1.

31. Vigor Mortis, People, June 7, 1999, at 117.

32. See Exhibit 2, supra note 6 (Business Trends Analysts Report).

33. See Exhibit 11 (http://aetherserv.com/sweetearth, Sweet Earth Casket Shop Web Page); Exhibit 12 (www.casketfurniture.com, MHP Enterprises Web Page).

34. See Exhibit 13 (http://www.volcano.net/~johnstone/caskhome.html, Carpenter Homemade Casket Web Page).

35. Id.

36. See Exhibit 14 (http://www.impnet.com/calcata/coffin.html, What A Way To Go - R.I.S. Rests-In-Straw Coffin for the Cradle to Grave Environmentalist).

37. See Exhibit 15 (http://www.consumercasket-usa.com/plan4.htm, Consumer Casket USA Web Page).

38. Id. (emphasis added).

39. See www.casketstores.com (National Casket Retailers Association Web Page); www.illinoiscasketco.com (Illinois Casket Co. Web Page); www.casketstoreoutlet.com (Thwal/Casket Outlet Web Page); Colles Stowell, Hampton Falls Firm Finds a Lively Market for Retail Casket Sales, New Hampshire Business Review, Nov. 21, 1997, at 14; Su-jin-Yim, Casket Store Challenges Funeral Cost, News & Observer, July 12, 1997 at D1; Steve Everly, Caskets To Go: Store Is First for KC Area, Kansas City Star, Mar. 18, 1998, at A1; Jim Yardley, Selling Coffins From a Storefront, N.Y. Times, May 29, 1998, at A19; Linda McNatt, New North Carolina Store Has Customers Dying to Get In, Roanoke Times & World News, Jan. 27, 1998 at A5.

40. Otherworldly Ways to Mark a Passing, Pittsburgh Post-Gazette, May 26, 1999.

41. Id.

42. 47 Fed. Reg. at 42,260.

43. Id.

44. See Exhibit 1 (Robert D. Tollison, The Funeral Rule After 15 Years: Expand or Sunset? (Aug. 11, 1999)) [hereinafter "Tollison"].

45. Id. at 1.

46. Id.

47. Id. at 11.

48. Id. at 11-12.

49. See, e.g., Rotstein, supra note 1.

50. See Tollison Exhibit 1, supra note 44, at 11.

51. Id. at 17.

52. Id.

53. Id.

54. Id. at 18.

55. Id.

56. Id.

57. See Exhibit 16 (AARP Product Report Vol. 2, Funerals and Burials: Goods and Services, (1996), at 3).

58. See Exhibit 17 (Study of the Regulation of Cemeteries, Report of the Board for Professional and Occupational Regulation to the Governor and the General Assembly of Virginia (1999), at 12, Question 7) [hereinafter "Virginia Cemetery Study"].

59. See Exhibit 18 (Powell Valley Memorial Gardens "Vault Handling fee for Steel Vaults"); Exhibit 19 (Temple Hill Memorial Park "Vault Installation Fee"); Exhibit 20 (Green Hills Memory Garden "Vault Installation" and "Marker Installation" fees); see also Exhibit 17, supra note 58, at 1 (Virginia Cemetery Study) (during public comment,"[a] representative of the Monument Builders of Virginia and West Virginia expressed concern that cemeteries place unnecessary rules and fees on the placement of monuments by outside companies").

60. See Exhibit 21 (Sunset Memorial Gardens Feb. 24, 1999 Memorandum to All Vault Companies re: Vault Installation Permit and Insurance Update); Exhibit 22 (Hillcrest Memorial Park Sept. 17, 1997 Memorandum to Monument and Memorial Dealers re: Memorial Policy and Guidelines).

61. See Exhibit 20 (Green Hills Memory Gardens "Administrative Fee").

62. See Exhibit 17, supra note 58, at 6 (Virginia Cemetery Study) ("One of the cost issues of most concern is the opening and closing of graves . . . . The cost of this service ranges from five hundred to one thousand dollars"); Boomers May Reform Funeral Business, The Roanoke Times, May 23, 1999, at A14 ("[l]ocal opening fees run from $450 to $1,200, according to Memorial Society of Greater Philadelphia. Ten years ago, the fee ranged from $300 to $600").

63. The Roanoke Times, supra note 62, at A14.

64. Id.

65. See Exhibit 23 (http://vbiweb.champlain.edu/famsa/greedy/htm, Greedy and Outrageous Tactics Web Page).

66. See Exhibit 24 (Olivet Memorial Park composition board policy); Exhibit 25 (Woodlawn Memorial Park composition board container policy).

67. See Exhibit 26 (Serving Families into the New Millenium).

68. See Exhibit 27 (Upson Memorial Gardens advertisement, Thomaston Times, Sept. 20, 1992).

69. Lawrence Messina, Cemetery Company to Hand Over Records, The Charleston Gazette, June 14, 1997, at A5.

70. Dick Bryan, Consumers Beware of Schemes, Michigan Chronicle, Dec. 3, 1996, at A7.

71. Id.

72. Wasik, supra note 8, at 58.

73. Rotstein, supra note 1, at 2.

74. See Exhibit 17, supra note 58, at 6 (Virginia Cemetery Study).

75. Gordon Faircloth, Discount Casket Stores Rattle Rafters in Funeral Industry, Arkansas Democrat-Gazette, Feb. 23, 1997, at 1G.

76. The Jewish Advocate, May 7-13, 1999, at 35.

77. Industry, Consumer Gear Up for Funeral Rule Debate, 3 Death Care Business Advisor, June 15, 1999, at 10 (emphasis added).

78. FTC Funeral Rule Review: Comment 02 (May 13, 1999 Letter from James M. St. George to Mr. Donald S. Clark) (emphasis added). Similarly, the Consumer Casket USA web site states: "although Consumer Casket USA is not governed by the Funeral Rule, the company has opted to voluntarily comply with the Rule, and to actually exceed its requirements." Exhibit 15, supra note 37 (Consumer Casket USA Web Page). Yet nowhere on Consumer Casket USA's internet page does the company recite the Funeral Rule's alternative container disclosures.

79. Should these two principal requirements require minor language adjustments throughout the remaining provisions of the Rule to effectuate the change in scope, such revisions should of course be considered and would more appropriately be addressed in response to a subsequent Notice of Proposed Rulemaking. For example, expanding the definition of "Funeral Provider" to any person selling funeral merchandise may require some corresponding limitation to the definition of "funeral goods," to avoid inclusion of florists. Similarly, certain disclosure requirements, such as the current alternative container disclosure, should be required of any person selling caskets, regardless of whether the seller offers cremation services.

80. See Tollison, Exhibit 1, supra note 44, at 21.

81. Id. at 21-22.

82. Id. at 22.

83. See Exhibit 28 (Funeral Rule Compliance - Results of FTC Sweeps).

84. See Exhibit 29 (NSM Family Follow-up Survey Results from 1988-1998).

85. Federal Trade Commission, Complying with the Funeral Rule 24 (Aug. 1995).

86. 47 Fed. Reg. at 42,298.

87. 64 Fed. Reg. at 24,251.

88. 47 Fed. Reg. at 42,298.

89. 16 C.F.R. § 453.1(p) and Sample 1 (General Price List) (1999).

90. 59 Fed. Reg. 1592, 1593 (1994) (emphasis added).

91. 59 Fed. Reg. at 1606.

92. See Exhibit 28 (Funeral Rule Compliance - Results of FTC Sweeps).

93. See Exhibit 30 (http://www.gallup.com/poll/releases/p97213, Honesty & Ethics Poll: Pharmacists Strengthen Their Position As To The Most Highly-Rated Occupation, The Gallup Organization, Poll Releases, Dec. 13, 1997).