Toug Ying Industrial Co., Ltd.

Case:

Tong Ying Industrial Co., Ltd. violated the Fair Trade Law for posting false and untrue advertisements for the Aerosoles products

Key Word(s):

False advertisement, source of products

Reference:

Fair Trade Commission Decision of April 10, 2013 (the 1118th Commissioners' Meeting); Disposition Kung Ch'u Tzu No. 102043

Industry:

Wholesale of Clothing and Clothing Accessories (4552)

Relevant Law(s):

Article 21(1) of the Fair Trade Law

Summary:

1. The Aerosoles products manufactured by Tong Ying Industrial Co. Ltd. (hereinafter referred to as TYI) had nothing to do with US-based Aerosoles but TYI posted in its advertisements the wording of "Aerosoles 2012 diversified culture x Asian fashion having created the American brand name Aerosoles," "currently an agent for Aerosoles," and "Aerosoles from the American brand name established in 1987" to mislead consumers into believing the bags and wallets manufactured by TYI came from the US or were related to the American brand Aerosoles. The conduct was suspected in violation of Article 21 of the Fair Trade Law.
2. Findings of the FTC after investigation:
   

   (1)

   On its company website, Facebook, the Payeasy online shopping site, and the 123 job bank website, as well as in flyers and advertisements put up by the company, TYI posted the wording of "Aerosoles - a true American brand name established in 1987," " the royal family members and celebrities' favorites over the years and available items in department stores and shopping malls in New York, London, Athens, Italy, Shanghai, and Hong Kong," "currently an agent for Aerosoles," "born in 1987," "diversified culture x Asian fashion having created the American brand name Aerosoles," "Aerosoles - an American brand name established in 1987," and "with more than 20 years of experience creating shoes..."

   (2)

   However, FTC's investigation revealed that TYI only registered the Aerosoles trademark in Taiwan and the company was neither related to nor an agent for US-based Aerogroup International LLC. The US-based company never registered or sold its Aerosoles products overseas. In fact, shoes were never one of TYI's sales items and no royal family members or celebrities had ever used its products.

3. Grounds for disposition:
   

   To market its Aerosoles products, TYI posted on its company website and in flyers and advertisements the wording of "Aerosoles - a true American brand name established in 1987," "the royal family members and celebrities' favorites over the years and available items in department stores and shopping malls in New York, London, Athens, Italy, Shanghai, and Hong Kong," "currently an agent for Aerosoles," "born in 1987," "diversified culture x Asian fashion having created the American brand name Aerosoles," "Aerosoles - an American brand name established in 1987," and "with more than 20 years of experience creating shoes…" However, TYI was neither a distributor nor an agent for the Aerosoles products whose trademark had been registered in the US by Aerogroup International LLC. TYI had never registered its Aerosoles trademark in any other country such as Taiwan or marketed its Aerosoles products overseas. As a matter of fact, TYI had not even sold shoes and there was no evidence of any royal family members or celebrities using its products. Therefore, it was fair to conclude that TYI made false and untrue representation in its advertisements that could mislead consumers into having wrong perceptions about the quality and content of the company's products. The conduct was in violation of Article 21(1) of the Fair Trade Law. Acting according to the first section of Article 41(1) of the same law, the FTC ordered the company to cease its unlawful act and also imposed on it an administrative fine of NT$400,000.

Appendix:
Toug Ying Industrial Co., Ltd.'s Uniform Invoice Number: 97238091

Summarized by Cheng, Shih-Yu; Supervised by Lai, Mei-Hua