The Federal Trade Commission said yesterday it has accepted a consent order prohibiting Levi Strauss & Co. from trying to control the retail price of its jeans and other products.
The company, one of the world's largest manufactures of men's, women's and children's apparel, was accused by the FIC two years ago of telling its 15,000 domestic dealers what to charge for its popular clothing.
In other actions, the commission:
Ruled that Fruehauf Corp. must divest itself of most of its Kelsey Hayes Co. assests because the 1973 acquisition violated the antitrust laws. The commission said the acquisition restrained competition in three markets: heavy-duty wheels, heavy-duty antiskid braking devices and truck trailers.
Challened the proposed merger of two competing manufacturers of lattice boom cranes, Harnischfeger Corp. and Northwest Engineering Co., and said it would seek a preliminary injuction in Federal Disrtict Court to prevent consummation of the merger pending the outcome of the administrative proceeding.
Under the agreement signed by Levi Strauss, the company agreed not to terminate dealers or take any other action against them because of their retail price of Levi clothing, not to even suggest retail prices at all for a five-year period, and not to require its retailers to carry other Levi products in exchange for the right to sell the popular denim pants.
Levi Strauss also agreed to let dealers use any Levi Strauss trademark in a lawful manner in advertising firstline Levi products at any price they choose.
A consent agreement is for settlement purposes; by signing one, a company does not admit it has broken the law. But a violation of the order, which carries the force of law, can result in a civil penalty up to $10,000 per violation.
The agreement was accepted by the agency on a tentative basis; it remains on the public record for 60 days before the commission takes it up again.
In the Fruehauf case, the commission adopted with some modifications an initial decision of Administrative Law Judge Thomas Howder; it declined to accept his view that Fruehauf, the nation's largest truck trailer manufacturer, should divest itself of all of its Kelsey-Hayes' assets. The commission said it could retain the assets related to its aerospace and agriculture groups.
Kelsey-Hayes is a leading maker of automotive components, including two needed in truck trailers.
According to the FTC complaint against the proposed Harnishcfeger-Northwest Engineering merger, the two are direct competitors in the manufacture of the lattice boom cranes used in construction. Harnischfeger with $466 million in annual sales, is the nation's fifth largest producer of the cranes and accounts for 12.5 percent of U.S. production. Northwest Engineering, with total annual sales of $43.3 million last year, is the 7th largest producer and accounts for 6.4 percent of U.S. production. The combination would become the second largest producer in the U.S., one FTC source said.