At first glance, the arguments are familiar: The company says the federal government is persecuting it, and the government agency says the company is cheating consumers.
But the case of the FTC vs. JS&A Group Inc. is far from normal.
The Chicago-based electronics products mail order house opened the first battle in what promises to be an interesting war with a quarter-page advertisement in The Washington Post and The Wall Street Journal yesterday.
"You've heard of the tax revolt. It's about time for an FTC revolt. Here's my story and why we've got to stop federal bureaucratic regulation," reads the ad.
"My story is only one example of how the FTC is harassing small businesses but I'm not going to sit back and take it," continues the text next to a photo of JS&A President Joseph Sugarman.
What follows is a detailed story in which Sugarman blames "three major blizzards" in the Chicago area in January 1979 and a computer failure for the inability of JS&A to fill its mail orders within the 30-day period mandated by the FTC.
Still, he said, the FTC investigated complaints from consumers claiming that they had not received their orders from JS&A.
"Despite our efforts to manually notify our customers of our delays, our computer was not functioning, making the task extremely difficult," the ad claims.
Then the FTC asked the company to pay a $100,000 penalty for not shipping its products on time.
"If this all sounds like blackmail -- that's just what it appeared to be to us," the ad states and urges congressmen, senators and businessmen to "take the powers of the FTC from the hands of a few unelected officials and bring them back to Congress and the people."
The FTC, predictably, sees things differently.
In a letter sent yesterday to Rep. James Scheuer (D-N.Y.), chairman of the House Commerce subcommittee, FTC Bureau of Consumer Protection Director Albert Kramer responded to the advertisement.
"Although staff intends to continue this nonpublic investigation in accordance with the commission's rules of practice and procedures, I believe that certain information concerning the investigation should be available to you in light of Mr. Sugarman's statements," Kramer wrote.
Kramer first pointed out that the FTC doesn't require that a shipper send goods within 30 days, only that it inform consumers when a delay of more than 30 days occurs, giving consumers the option to cancel.
"Concerning staff's investigation of JS&A group," he continued, "staff has compiled considerable information to give it reason to believe that the company was in widespread violation of (that) rule for approximately two and one-half years before its computer problems in late 1978 and early 1979."
Kramer went on to add that his staff has uncovered additional information that the company is violating another rule in some cases by failing to refund customer's payments even after offering its products on a "free 30-day trial period."