542 F.2d 611

542 F.2d 611

37 ALRFed. From 62,76 2 USTC P 9801,
61,066 cases from 1976 two trade

Beneficial Corporation, a Delaware company stock,
Management Co., Ltd., Co., Ltd. Delaware, beneficial petition,
Federal Trade Commission against the defendant.

2102 from the 75th.

United States Court of Appeals,
Third Circuit.

Claimed June 8, 1976.
Decided September 8, 1976.
Was amended September 14, 1976.

R. Franklin Balotti, Richards, Layton & Finger, Wilmington, Delaware, E. Norman Veasey for, the petitioner,.

J Robert Lewis, attorney general, Gerald P. Norton, deputy commander lawyer, Gerald Harwood, ASST. For attorney general, William AE Doying, Atty, Washington DC, Federal Trade Commission. See Also instant paday loans .

Van Dusen, and before ROSENN gibbon, Circuit Judges.

Opinion of the court

Gibbons, Circuit Judges.


We have to consider a petition for review of a final order of the Federal Trade Commission here has submitted in accordance with 15 USC 45 (c). The order directed the shares in favor of petitioner enjoined from making certain practices of the connection with loan and tax preparation business. The challenge to both the width of the relief committee and its determination of a breach of the beneficial. We stand, I will enforce the order of the Commission are considered part because in some sense and order have been too wide and remand in part and dismissed. Check out also instant online payday loans .

Minutes of Commission I.


On April 10, 1973, Federal Trade Commission, the transactions in violation of the section, and deceptive and is an unfair connection with the making of consumer loans of the loan office of the financial system and useful preparation of income tax return 5 Federal Trade Commission Act filed a complaint charging beneficial practices, of 45 15 USC . 1400 through a branch of a wholly owned subsidiary with a beneficial financial system engaged in the business on the basis of their creditworthiness, make loans to the people of the general run, beneficial. I decided to start a business is beneficial is the preparation of income tax return in the spring of 1969. For, by the development of computer technology, loan officers valuable we were able to collect the information required by the computer to prepare tax returns accurately and at a reasonable cost. Based on the belief decision of whether to enter the project preparation of tax returns, it is to borrow the funds from such beneficial to the customer of the service in need of funds to pay the tax to be due to know that would be useful have. It became immediately apparent, however, will be such that most customers will receive a tax refund actually. Beneficial and therefore, decided to advertise the loan eliminates the wait for refund checks from the government, provides for the use as soon as the money expect a refund of the tax. Commission and the beneficiary, the tax refund tax refund loan is expected on the basis of the creditworthiness of the borrower, agreed that there is nothing other than the normal loan services to beneficiaries as there is a possibility that does not have a relationship at all was. The parties, advertising (1) loan it in order to solicit customers for loans, in the service of the preparation of tax returns that improperly beneficiaries and (2), whether by their nature deceive the customer as were different whether you use the tax information was obtained. See Also instant cash lenders . After the administrative law judge heard evidence on October 21, 1974, that the violation has been beneficial in terms of both. The Committee supported this decision on July 15, 1975, inter alia, tax refund, "" Instant terms in the ad that is protected by copyright, with words and other words of similar import 'or Except under the conditions stipulated prohibited from beneficial, and "meaning, or to enter a cease and desist order, from using the tax information of the customer in the solicitation of the loan.


Advertising of the early 1970s, usually, before establishing evidence that you used the text like the following from the year 1969 in the administrative law judge beneficial.


You are before mailing your return of the cash advance you need now? Do you have a refund coming to you in income taxes this year, wait a few weeks for check refund is not available. Check out also instant one hour payday loans . Because they are beneficial you now " to get the money even. We call it instant tax refund, special services instant tax refund is beneficial finance beneficial, we better ... "


Add a reference to the fact beneficial in February 1970, to the loan, it must be to qualify for that loan customers. When your order of the Commission of radio and television advertising is beneficial, usually, there were additional changes and qualifications with the results of that there was something like this:


"ANNCR: This year, your taxes have to prepare a better way ...


Singer: be beneficial (blow, blow.). .


Beneficial in finance: ANNCR. Beneficial income tax services, the computer will do your taxes. . . For just $ 5. Listen to the plan "instant tax refund" What useful: If you have a refund coming to you, you must wait a few weeks to check for a government does not have. The moment you qualify, be beneficial immediately, in cash, will lend the equivalent of a refund for your loan. Check out also instant payday loanns . It is "location. Are tax plan will come out this year is. In finance beneficial..." Instant tax refund


Concluded that the Commission, and was mistaken for false both the copy and changed original ad, the appropriate remedy is a total ban on the use and "institutional tax refund instant term" copyright, no matter how "loan tax refund instant" modified in the following text before or did not.


Since 1969, it is when they start their business preparation of tax returns that, until December 1971, be beneficial for the purpose of soliciting a loan on a regular basis, the tax return that late evidence before the administrative law judge was established that you used the information obtained from customers in this manual. Indeed, the generation of business lending was the main motivations underlying the decision to advance to the preparation of the declaration business. On December 10, 1971, 316 of the Revenue Act of 1971, 26 USC 7216, the effect has been enacted on January 1, 1972. Subject to the material is no exception, 7216 (a) is provided here


General rule. Or compensation for that, and those who are engaged in the business or tax return preparation, imposed by Chapter 1 of section 6015 or under, to provide a service to connect to the preparation of the declaration of estimated tax declaration or amendment of return or declaration of all the preparations, such as people, for others, who


Or related to, disclose the information to be provided to him for (1), and preparation of such return or declaration,


To use such information for any purpose other than to support, or preparation of the preparation (2), such return or declaration,


Or fined thousands of dollars, and is guilty, upon conviction of a misdemeanor, along with the cost of prosecution, from not more, will be imprisoned not more than one year, must, or both .


This law establishes a general prohibition against the disclosure or use of non-tax purposes for tax information that is collected by the author, such as beneficial tax. Under 7216 (b) the authority of the (3), Treasury Regulation was adopted in 1974, however, with the written consent of the customer, the use of such information will be allowed. The new law is to change the practice of solicitation that inevitably beneficial. Is that an attempt has been made to conform to the requirements, forms BOR-56 beneficial, prior to reproduction in the margin in its entirety, the loan officer that is to solicit the customers of the loan first, the customer's signature declaration on the form adopted the need to raise. The Committee held that there was a trade practices and deceptive unfair to use the -1972 pre-tax information for solicitation of a loan in violation of the provisions of the 5 , corresponding to the abuse of trust relationship . See Also instant payday loans in georgia . In addition, we held that the form and BOR-56 was insufficient as informed consent. Current practices of the beneficiary without having to determine whether a violation of the law revenue in 1971, the Commission held that these practices will continue to violate the 5 , when you enter the injunction more useful.


As a result of such information 7. ", And the customer's name is indispensable to prepare the report if obtained by the respondents, to what purpose do not need or / or, all of the respondents, including the address After he is used to indicate information about customers, to get answers to such information before, have been requested from the concrete, unless (1), he, the tax return of the respondents When used in any way have an interest in using the service created, which contains the information given from the customer, the information report of customer customer preparation of tax returns for customers, (2) shall include right you run a separate written consent signed by the customer:

A. Names of the respondents

Two. The name of the customer


Three. The purpose of the specific agreement has been signed


Four. Accurate information to be used


Five. The particular use made of such information


6. Entity's information will be available to the parties or


Seven. Sun such consent is signed


Eight. Tax return information statement may not be used in the tax return preparation for any purpose other than that listed in the agreement, and


Nine. A statement by the taxpayer, he will agree to use such information for a specific purpose listed in (3) subparagraph of this paragraph.


However, this document shall be prohibited from using that to answer the names and addresses of customers only for the purposes of correspondence with clients such as those pertaining to a business income tax preparation of the respondents alone.


From 92 178 and is not intended to soften the terms of the above Pub.L. anything, the answers of other requirements imposed on them by the Revenue Act of 1971, Title III, 316 (), 12, 1971 May 10, 7216 26 USC or regulation has been issued pursuant to it. See Also instant 1000 loan no faxing . "


Instant petition for review, followed the committee's decision and order. See Also instant long term online loans .

II. False advertising



At the beginning, the Committee useful, the advertising campaign of "tax refund" Instant that, if the knowledge that such a claim does not exist, on the record and find that it is a false lack the support of evidence is supported by the evidence, the order was not entered properly respect the ad at all. See Also instant installment loan . 5 (c) of the Act, 45 (c) of 15 USC, the review of the Court of Appeals "(t) as the fact that his findings of the committee, if they are supported by the evidence is conclusive and stipulates that "must be. That you need to properly interpret the law, to review by the substantial evidence standard of record as of the entire law is clear. Party, the tendency of advertising to deceive, you will agree that without having to highlight a word or phrase isolated from its context apart, shall be determined by looking at it as a whole. Intent to deceive is not an element of deception advertising fees under the age of 5 . In addition, FTC, the ads that are maintained in order to find evidence misconception is that there is no real effect to the customer. And trends in the possibility of fraud is the standard by measuring the ad. Whether it has a tendency to deceive or misleading ads specific, a finding of fact will determine the impression that more closely resembles the conclusions of law and clearly. CF. Co., Colgate-Parumo vs. FTC, 374,385,80 S.Ct. 155 (1965) 380 U.S.. At the same time, it is important support for the discovery of evidence that the tendency to misunderstand the thrust of the message that some customers actually misunderstood.


The first ad was quoted on the (1969 - early 1970s), the words at least, that customers must meet the criteria on a regular basis the credit strength, that the "prior" to be provided by the loan actually shown in or, if he did not for that customer, even though the customer was not in the preparation of the declaration, he has a sufficient credit rating you can get a beneficial loan. Beneficial own advertising agency, reported that the first campaign as the nature of the "refund" that is provided, led to a fairly wide range of public confusion. Check out also installment loans in online . Committee concluded:


Advertising of tax refund instant "early from becoming clear that misleading about the nature of the offer of useful fully, to their faces, useful is. Instead, simply, that provides lending services everyday , advertising is beneficial because of the amount of refund of their means to give a cash advance special income customers of tax preparation and refund of the government, tax refund instant is emphasized as a special exclusive Because, in the natural impression, this caching is that of consumer loans and usually has a different. "


This finding is supported by substantial evidence. Although not admit the validity of the Commission with respect to the first ad to find, informative and we are not argued that there is a need to accept it seriously. Since this was abandoned committee sought from the initial text is not immediately be found to support a cease and desist order is not possible, however, claims to be. However, you can of this and other court to resume stop illegal trade practices, at least here, the previous practice has been held to be the subject of cease and desist order. Submitted to up to three years after you stop the ads early complaints committee here, the Committee can be inferred to be repeated in the form of initial, evidence has not been not from there. Cease and desist order be beneficial in such situations solely on the basis of the initial violation, prompting the entry, hit the abuse of discretion.


We are We are, however, in this case the problem in order to conclude in the committee, and to discover that there was a misunderstanding and advertising trend is deceiving later, and that support sufficient evidence of record as a whole There is no need to decide. Commission testimony of some consumer payment was to a later period, they will be beneficial is only the financial costs of normal, may have failed to understand that had provided the loan service normal . Their impression, instant tax refund loan qualification major was that the right to receive a refund of the actual government. See Also installment no credit check loan . There is a possibility that these consumers often very dense. They were part of the audience in spite of it, the ad has been directed. We guess that you respect the ads to find the second after the committee is not allowed. FTC's petition against Fedders, 529 F.2d 1398,1403 (1976 circuit 2D), of the certificate; Colgate-Parumo versus FTC (strain), supra. , (USApr. 19,1976) that have been submitted by 44 USLW 3652. Committee Thus, regardless of whether or not might have to act on the basis of earlier advertisement simply, so it is a persistent confusion indeed, abuse its discretion to conclude that some relief was appropriate yet had not been.



The only appropriate remedy for violation of both the committee and the administrative law judge found, we concluded that a total ban on the use of any word or phrase of similar import instant tax refund. Beneficial to cure the trend words, the description is misleading, it argues that in order to force them to abandon the phrase and heavily promoted its full copyright, and may be unfair. The Committee reasoning:


In the language concise, the truth is, tax refund Instant is a refund for no. Phrase is inconsistent essentially the truth of the offer in the beneficial, is not equal to the task of explaining the slogan of tax refund instant completely NO " However, financing of day-to-day service ... the only beneficiaries; the size of the loan beneficiaries wish to sell is also the problem is that intended for the customer's credit limit, instead he do not qualify for the refund of the government Many people and government of the refund, tax refund loans instant tax refund at all which is the lowest of any in accordance with .... "


We, as the capacity of the preliminary conclusions of the European Commission and do not think the language can be maintained to inform the audience of the true nature of the beneficial services that are provided. We can that we defer broadly to the exercise of the Commission discretion to information framing the remedial order to tie the relationship between some reasonable for the prevention or removal of the violation established usually is mandatory, of course , admit. National Lead Co. vs. FTC, 352 U.S. 429,77 S.Ct. please see. 502,1 L.Ed.2d 438 (1957); Colgate-Parumo versus FTC (strain), supra; FTC vs. Windsor (strain), 437 F.2d 443,444 (1971 3-D circuit) per curiam ( to distribute); consumer products in America, Inc. A pair of FTC, 400 F.2d 930,933 (. 1968 three-dimensional circuit). However, we are in the form of government regulation of speech are dealing in this case. Check out also instant payday loans for unemployed . The first amendment, it is necessary to consider the action of the Commission we believe, you are looking for more in other contexts.


It is the first revision has been established beyond dispute that the exception of commercial speech does not exist now. Check out also instant loans tonight i hour . Virginia Citizens Consumer Council to pharmacy, Inc. Committee of Virginia, U.S. , please refer to the 96. Year 1817 S.Ct., 48 L.Ed.2d 346 (1976); Bigelow vs. Virginia, U.S. 809,95 S.Ct. 2222 years 421, 44 L.Ed.2d 600 (1975); addition, vs. Young America Please refer to the mini theater. , U.S. , Inc., year 96 S.Ct. 2440, 49 L.Ed.2d 310 (1976). Otherwise it is the advertiser, does not mean that they can engage in voice is an important part of the scheme to violate the law valid. Check out also instant loans lenders only . Human relations committee of Pittsburgh Press Pittsburgh (Thailand) Co., Ltd., the year 376,388,93 S.Ct. 2553 U.S. 413, 37 L.Ed.2d 669 (1973). It is relief for violations that are perceived, can impose a constraint pre-commercial speech that is protected more than reasonably necessary to achieve the purpose relief to prevent the violation, and that you can not go over it means. See Also online cash advance. For example, please refer to O'Brien in the United States, 391 U.S. 367,382,88. 20 L.Ed.2d 692 years 1673 S.Ct. (1968); there is room for the United States versus New Jersey Lottery Commission, the discussion, empty as the United States 417 491 F.2d 219 1974 907,94 S circuit (3D )) CT banc (. Year 2603, 41 L.Ed.2d 211 (1975); preliminary and Veterans for Peace (CIR 3-D), the certificate of the customs revenue, Thailand, Vietnam, 459 F.2d 676. Denied, 933,93 S.Ct. 232,34 L.Ed.2d 188 (1972) U.S. 409; to 814 from 813 Linmark Associates, Inc. vs. Township of Willingboro, 535 F.2d 786, (1976 circuit 3D) (Gibbons, J., dissenting).


920,86 L.Ed. 1262 (1942) S.Ct. 52, 62 before the end of the United States, 316 Chrestensen vs. Valentine, Bigelow vs. Virginia Citizens Consumer Council to pharmacy, Co., Ltd., and further cit Changing the message has been notice in the Commission Virginia Supreme Court held that to order resection Virginia, supra, from the Federal Trade Commission, and abused its discretion or be able to eliminate the portion of unpleasant without regard to whether the advertisement of valuable business assets such as trade names. Jacob Segal Co. vs. FTC 608,66 S.Ct. 758,90 L.Ed. 888 (1946) the United States, 327, Royal Thai milling Inc. FTC, 212,53 S.Ct. 335,77 L.Ed U.S. 288 . 706 (1933). Said that the second circuit where not inconsistent with the language used to identify the advertiser essentially to modify the language of the description, and should be accepted in preference to it than that require resection. Check out also instant tax service holiday loans . Elliott Co. vs. FTC knit (. 1,959 circuit 2d), 266 F.2d 787,790. Avoiding to convey the impression they are beneficial in combination with no words are displayed in proximity relationship of "refund" and "instant" The Committee is not a tax refund an instant, that it provides an instant loan from government you are trying to distinguish on the grounds that these rights can not be. We do not believe in the following example, convey an impression that is not allowed.


"You can expect to provide a loan refund immediately whether or not to use tax and service our borrower to borrower loan of everyday useful services were modified on a regular basis. See Also instant payday loan lender ."


"Loan service daily useful, you can provide a loan instantly expect a refund of the tax of his borrowers are qualified on a regular basis of any. We. Referred to as a loan expected to refund instant it"


Failure to consider the possibility and simply requires that a copy of the ad will be rewritten instead of total excision of the language of the problem completely, the Commission, under 5 as formed in the processing line Jacob Siegel Royal case seems to be beyond the authority of relief. Opinion of the committee, board deal with the case of Royal Milling in a footnote:


I have been thinking "We are processing line Royal case to some extent, has no effect, and is compatible with the responsibility normal of us to enter orders for the too wide, in fact, fully effective It may be limitations or exceptions to the rights of the committee to devise a remedy I, we, we "exception from the trade name a committee that is connected to the board the Royal Milling on advertising slogan refused to expand to reject the construction of the limit. This conclusion is, we are based in part on the difficulty rather than difference, have to accept the differentiation of the Commission distinguishes between the advertising material that is protected by copyright and trade name to the spirit of the Royal Milling. Conclusion, indeed, the construction a wide range of the Committee of the rescue organization 5 that is, to survive the end of the exception of commercial speech to the revision of the first to can not, however, the indifference of the long shadow cast by the first amendment has been reached is not a. Royal milling of the term, but describes the limitations of statutory power correction of the Committee of the particular class of cases simply, it is the rule announced today, then, has evolved into a general statement of the principles of the Constitution.


The Committee, as government agencies any, it must be starting from the premise that the suspect prior restraint of any, or it can be relief, for unauthorized advertising, further than is necessary removal of deception You can go. Without considering the context word is displayed, the order of the Commission proscribing, go than was allowed for the purpose of its further use of the word of meaning or import or similar words or other tax refund instant long-term , was an abuse of discretion the corrective action of the committee. See Also instant cash loan in oxfordshire . In that form, or to force positive without such considerations can not be. See Also instant signing of loan papers .

III. Violations tax information


The European Commission, storage and use of tax information that the customer will be charged in violation of 5 to the complaint in two ways. First, the customer to false belief that a special relationship between the customer and tax return preparation is the information that is provided and trends in the capacity of the misunderstanding is only used for the preparation of tax returns, and the wrong and will remain confidential had charge. Therefore, the practice was said to be false for failure to disclose the use of loan solicitation is expected to hurt the customer false leads, a misunderstanding. Second, the Commission has failed competition for competitors of the business can be a useful preparation of tax returns, to divert the business, are expected to disclose the use of tax information in the solicitation of the loan, from whom the accused, because it was unfair way.


Does not claim to benefit, the solicitation of the loan, the use of tax information for 316 of the Revenue Act of 1971 year absence and is the subject out of the reach of authority 5 of the European Commission. Rather, it is it based on Treasury Regulation and the laws of the latter, the issue that the order of the committee ahead of the field, that require more is invalid, that it is in full compliance with these regulations have claimed to have. 5, on the other hand admit that gave the authority of the Commission in order to find the unfair trade practices related to tax preparation service originally, the beneficiary, 316, by the Congress in its power to enclose have claimed to have been intended. are called legislative history is not in the face of 316 does not support its construction anything, although we would tend to suggest such intention. Criminal prohibition of 316, except in cases where there are circumstances that are specified and seems to be towards maintaining the confidentiality of tax return information. See Also instant approval loans 1 hour . Enforcement under the age of 5 of the Federal Trade Commission Act is intended to prevent acts and practices in contrast, is an unfair and deceptive. I have no conflict between two policies, for reasons attributable to the intention to reduce the power consumption of the Commission to prevent unfair or deceptive to the Parliament is not available. The Commission, if the action was inconsistent with the policy directions of the confidentiality of 316, we were able to understand the objection of useful. Check out also 100 poundscash loans . However, in this case we are pursuing the goal of government in a manner independent committee was completely consistent with that policy. Check out also instant loan sacramento . For the Committee, that exceed the requirements of Treasury Regulation 301.7216 3 from some trivial point seems to be so perfect for us. , Or the Internal Revenue Service has never approved the BOR-56 form that is useful is our view conflict will be changed. Assuming such approval, the law revenue in 1971, other laws and regulations, or the Internal Revenue Service in order to determine what the appropriate remedy for violations of 5 of the Federal Trade Commission Act nothing does not grant permission. Check out also installment loans with high acceptance .


Practices beneficial of the Commission, by substantial evidence in the record BOR-56 to disclose the nature and purpose of the waiver of confidentiality enough is as follows for, then before and both of the enactment of 316 discovered that there is a misunderstanding of the entire failure of the forms that are supported. Check out also instant cash loans direct lenders . Relief order to solicit the customers of the tax return form for the business loan will allow beneficial, you need to comply with certain procedural procedure. (1) to replicate the requirements of Treasury Regulation 6 (9) (2), (3), (7) and (8) items. Additional items required to be disclosed is as follows.


Four. To display the exact information to be used.


Five. The particular use made of such information.


6. Entity's information will be available or the parties.


These additional requirements are related to the misconduct committee found reasonable. We hold that, if you abuse its discretion in fashioning a remedy the Commission made in these situations is not possible.

IV. Conclusion


Petition for the review, the order of the Commission, as long as that requires a total excision of the "instant tax refund" of words from all the ads useful, will be granted. See Also installment loans, . Case is remanded to the Commission for further proceedings consistent with Part IIB of this opinion that part of the order and set aside. Petition for review is denied in all other respects. Petition was ordered to follow it to a certain extent that the application is denied, the order of the committee is to be maintained. See Also instant faxless payday loan .











" "




"" "" "" ""


""FTC302 F.2d 25826231962


I would affirm the conclusion reached in part II-C of the Commission's opinion in view of these legal principles adopted by the Supreme Court of the United






Although it is now clear that commercial speech enjoys "some" First Amendment protection, the Supreme Court has been careful to state that "regulatory commissions may prohibit businessmen from making statements which, though literally true, are potentially deceptive. Check out also installment loans in new jersey ." Young v. American Mini Theatres, Inc., US , 96 S.Ct. 2440, 2451, 48 L.Ed.2d 310, and n. 31 (1976); see Virginia State Board of Pharmacy v. Virginia Citizens Consumer Council, Inc., US , , 96 S.Ct. 1817, 1830, 48 L.Ed.2d 346 and n. 24 (1976), where the Court said: "The First Amendment, as we construe it today, does not prohibit the State from insuring that the stream of commercial information flows cleanly as well as freely."


In Young v. American Mini Theatres, Inc., supra at , 96 S.Ct. at 2451 n. 31, the Court stated: "The power of the Federal Trade Commission to restrain misleading, as well as false, statements in labels and advertisements has long


been recognized (citing cases)." B. THE FEDERAL COURTS ARE






In Jacob Siegel Co. v. Federal Trade Commission, 327 US 608, 66 S.Ct. 758, 90 L.Ed. 888 (1946), the Court repeatedly emphasized the "limited" scope of our review of Commission discretion. In Seigel, the record did not indicate whether a remedy short of excision had been considered or would be adequate. Check out also instant payday loans for minnesota . The Court declined to hold that excision was inappropriate and simply remanded for consideration of a more limited remedy. See also Federal Trade Commission v. Algoma Lumber Co., 291 US 67, 54 S.Ct. 315, 78 L.Ed. 655 (1934) (upholding an excision order).


Here the Commission has considered and rejected a more limited remedy, and the Siegel case states at page 613, 66 S.Ct. at page 760, that: "The courts will not interfere except where the remedy selected has no reasonable relation to the unlawful practices found."


Applying the standard enunciated in Jacob Siegel, which appears to survive the demise of the former commercial speech doctrine, I believe the choice of the remedy of total excision was permissible on this record.


In all other respects, I concur in the majority opinion.

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