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Bakers Franchise Corp. v. Federal Trade Commission.

filed: May 1, 1962.

BAKERS FRANCHISE CORPORATION, IRVING G. FOX AND HARRY C. FREEDMAN
v.
FEDERAL TRADE COMMISSION.



Author: Goodrich

Before GOODRICH, McLAUGHLIN and KALODNER, Circuit Judges.

Opinion of the Court

GOODRICH, Circuit Judge, The petitioners in this case*fn1 seek review and reversal of an order issued by the Federal Trade Commission upon a complaint charging them with dissemination of false advertisements in violation of the Federal Trade Commission Act.*fn2

Bakers is engaged in licensing persons in the baking business throughout the United States to produce and sell bread made from a secret formula which is petitioners' property. Persons so licensed are permitted to market this bread under the trademark "Lite Diet." Bakers supplies advertising copy and materials which are placed by the licensees in newspapers and on radio and television. The Commission charged that in the course of their business Bakers had disseminated advertisements representing that this bread, "Lite Diet," was a low calorie food and that its consumption as part of a diet would prevent the consumer from gaining weight. The Commission charged that the bread was not a low calorie food and that the advertisements were false and constituted deceptive practices.

The Commission's conclusions are in findings 7 and 8 and are quoted verbatim:

"7. The words light diet are interpreted by the public to mean a low calorie, reducing diet. Thus, the use by respondents of the trademark 'Lite Diet' has the capacity to mislead and does in fact mislead the public into the belief that bread so advertised is lower in calories than regular white bread.

"8. The words 'Lite Diet' as a designation for respondents' product are false and deceptive and cannot be properly qualified to adequately protect the public from the erroneous and mistaken impression that respondents' product is a low calorie bread; qualification of the trade name will not remove the deception inhering in its continued use."

It was shown that "Lite Diet" bread is sliced thinner than many varieties of white bread sold on the market. A slice of "Lite Diet" weights seventeen grams compared to the twenty-three gram weight of the average slice of many white breads. Obviously, thinner slices of even the same bread would contain fewer calories. Thus, the thinner slice of "Lite Diet" bread contains forty-five calories, while the Commission's "average" slice of white bread contains sixty-two. A person eating a slice of "Lite Diet" bread would, therefore, be feeding himself fewer calories than if he had the usual slices of the thicker-cut white bread. But, as the Commission pointed out in the course of its discussion, the same thing would be true if one took one pat of butter instead of two, or a small slice of pie instead of a large one.

Pound for pound, a loaf of "Lite Diet" bread has the same number of calories as a loaf of ordinary bread, and the Commission says that the only difference is that "Lite Diet" is sliced thinner. There is a contention on the part of Bakers that the secret formula of "Lite Diet" adds other ingredients of high nutritional value, so that the thinner slice of "Lite Diet" is as beneficial, nutrition-wise, as a larger slice of ordinary white bread. There was some testimony to support this claim but no finding was made thereon. We think it is not significant one way or the other because the real point is whether "Lite Diet" advertising is deceptive and not whether the bread itself is nutritional.

Following is a set of the advertisements issued in the promotion of "Lite Diet." In some of the newspaper material the statements were accompanied by a picture of a slim, fully dressed, young woman holding a slice of bread. The Commission's brief to the Court contains additional samples of the advertising statements, but the following are listed as typical in the Commission's opinion and are repeated here although there was no dispute that other copy was also used. Here they are:

"Who'd believe it could help you control your weight? So try it . . . Lite Diet . . . Lite Diet. . . ."

"Here's a bread that tastes great yet helps you control weight. It's Lite Diet, Lite Diet, Lite Diet."

". . . Will you listen to him? Says it helps you keep slim . . . Do try it . . . Liet ...


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