IN THE UNITED STATES DISTRICT COURT
UNITED STATES OF AMERICA, Plaintiff
FEDERATED DEPARTMENT STORES, INC., and
Civil Action No.
WHEREAS plaintiff, the United States of America, has commenced this action by filing the Complaint herein; defendants have waived service of the Summons and Complaint; the parties have been represented by the attorneys whose names appear hereafter; and the parties have agreed to settlement of this action upon the following terms and conditions, without adjudication of any issue of fact or law and without defendants admitting liability for any of the matters alleged in the Complaint, and without this Consent Decree and Order constituting any finding or evidence against the defendant;
THEREFORE, upon stipulation of plaintiff and defendants, it is hereby ORDERED, ADJUDGED, and DECREED as follows:
1. This Court has jurisdiction of the subject matter and of the parties.
2. The Complaint states a claim upon which relief may be granted against the defendants under Sections 5(a)(1), 5(m)(1)(A), 13(b), and 16(a) of the Federal Trade Commission Act, 15 U.S.C. §§ 45(a)(1), 45(m)(1)(A), 53(b), and 56(a).
3. For the purposes of this Consent Decree, the term "Mail Order Rule" means the Federal Trade Commission's Trade Regulation Rule Concerning Mail or Telephone Order Merchandise, 16 C.F.R. Part 435. A copy of the Mail Order Rule is attached hereto as "Appendix A" and incorporated herein as if fully set forth verbatim.
4. Defendants Federated Department Stores, Inc., and Macys.com, Inc., their successors and assigns, shall pay to plaintiff a civil penalty, pursuant to section 5(m)(1)(A) of the Federal Trade Commission Act, 15 U.S.C. § 45(m)(1)(A), in the amount of $350,000. Defendants are jointly and severally liable for payment of the civil penalty.
5. Defendants shall make the payment required by Paragraph 4 within five (5) business days of the date of entry of this Consent Decree by electronic fund transfer in accordance with the instructions provided by the Office of Consumer Litigation, Civil Division, U.S. Department of Justice, Washington, D.C. 20530, for appropriate disposition.
6. In the event of any default in payment, which default continues for ten (10) business days beyond the due date of payment, the entire unpaid penalty, together with interest, as computed pursuant to 28 U.S.C. § 1961, from the date of default to the date of payment, shall immediately become due and payable.
7. Defendants shall establish and implement a program to educate consumers about consumers' rights under the Mail Order Rule. Such program shall be of a scope and employ media reasonably expected to reach a wide audience of consumers, such as:
No later than sixty (60) days from the date of issuance of this Consent Decree, defendants shall submit for review and approval to the Associate Director for Enforcement, Bureau of Consumer Protection, Federal Trade Commission, a draft plan for the program and drafts of any materials to be disseminated pursuant to this Paragraph. Such approval shall not be unreasonably withheld or delayed, and in any event shall be given to defendants within ten (10) business days of defendants' submission. Such description and materials should be sent by overnight delivery to the Associate Director for Enforcement, Bureau of Consumer Protection, Federal Trade Commission, 600 Pennsylvania Ave., N.W., Washington, D.C. 20580.
8. Defendants, their successors and assigns, and their officers, agents, servants, employees, and attorneys, and all other persons in active concert or participation with any one or more of them who receive actual notice of this Consent Decree by personal service or otherwise, are hereby enjoined from violating, directly or through any corporation, subsidiary, division or other device, any provision of the Mail Order Rule, including, but not limited to:
9. In the event the Mail Order Rule is hereafter amended or modified by the Commission in a manner that would create a new or different standard applicable to defendants' obligations under this Consent Decree, defendants' compliance with that Rule as so amended or modified shall not be deemed a violation of this injunction.
10. Defendants shall, within thirty (30) days of the entry of this Consent Decree, provide a copy of this Consent Decree and the Business Guide to the Federal Trade Commission's Mail or Telephone Order Merchandise Rule (Jan. 1995) ("Business Guide") to each of their supervisory or managerial agents, servants, employees and attorneys who are engaged in defendants' mail, telephone, facsimile or Internet order sales business, secure from each such person a signed statement acknowledging receipt of a copy of this Consent Decree and Business Guide, and shall, within ten (10) business days of complying with this paragraph, file an affidavit with the Associate Director, Division of Enforcement, Bureau of Consumer Protection, Federal Trade Commission, 600 Pennsylvania Ave., N.W.,Washington, D.C. 20580, setting forth the fact and manner of their compliance, including the name and title of each person to whom a copy of the Consent Decree and Business Guide has been provided.
11. For a period of five (5) years from the date of entry of this Consent Decree, defendants, their successors and assigns, shall maintain and make available to the Federal Trade Commission, within thirty (30) days of the date of receipt of a written request, business records demonstrating compliance with the terms and provisions of this Consent Decree.
12. For a period of twenty (20) years from the date of entry of this Consent Decree, defendants, their successors and assigns, shall notify the Associate Director, Division of Enforcement, Bureau of Consumer Protection, Federal Trade Commission, 600 Pennsylvania Ave., N.W., Washington, D.C. 20580, at least thirty (30) days prior to any change in defendants' business, including, but not limited to, merger, incorporation, dissolution, assignment, sale resulting in the emergence of a successor corporation, the creation or dissolution of a subsidiary or parent, or any other changes in corporate status which may affect defendants' obligations under this Consent Decree. Provided, however, that with respect to any proposed change in the corporation about which defendants learn less than thirty (30) days prior to the date such action is to take place, defendants shall notify the Commission's Associate Director for Enforcement as soon as practicable after obtaining such knowledge.
13. One hundred twenty (120) days after entry of this Consent Decree, defendants shall provide a written report to the Federal Trade Commission, signed by an officer of defendants, setting forth in detail the manner and form in which the defendants have complied and are complying with this Consent Decree. This report shall include but not be limited to:
Defendants shall mail this written notification to: the Associate Director for Enforcement, Bureau of Consumer Protection, Federal Trade Commission, 600 Pennsylvania Ave., N.W.,Washington, D.C. 20580.
14. Defendants are hereby required, in accordance with 31 U.S.C. § 7701, to furnish to the Federal Trade Commission their taxpayer identifying number (social security number or employer identification number), which shall be used for purposes of collecting and reporting on any delinquent amount arising out of their relationship with the government.
15. This Court shall retain jurisdiction of this matter for the purposes of enabling any of the parties to this Consent Decree to apply to the Court at any time for such further orders or directives as may be necessary or appropriate for the interpretation or modification of this Consent Decree, for the enforcement of compliance therewith, or for the punishment of violations thereof.
JUDGMENT IS THEREFORE ENTERED in favor of plaintiff and against defendants, pursuant to all the terms and conditions recited above.
Dated this ___ day of _____, 20__.
UNITED STATES DISTRICT JUDGE
The parties, by their respective counsel, hereby consent to the terms and conditions of the Consent Decree as set forth above and consent to the entry thereof. Defendants waive any rights that may arise under the Equal Access to Justice Act, 28 U.S.C. § 2412, concerning the investigation and prosecution of this action.
FOR THE UNITED STATES OF AMERICA:
DAVID W. OGDEN
Assistant United States Attorney
JANICE PODOLL FRANKLE
FOR THE DEFENDANTS:
FEDERATED DEPARTMENT STORES, INC.
DENNIS J. BRODERICK
JONES, DAY, REAVIS & POGUE
PHILLIP A. PROGER, ESQ.