The Indianapolis times. [volume] (Indianapolis [Ind.]) 1922-1965, 1927-07-29
US. Ban HITS
PRISON GOODS
Sale TACTICS
Commission Scores System
Used by Chicago Jobber
at Michigan City.
LAW EVASION Is SEEN
No Record of License or
Labelling of Products by
Manufacturer
LAW EVASION is SEEN

The Federal Trade Commission
has ordered discontinued the prac-
tice of jobber selling shirts, shoes
and binder twine, manufactured in
the Indiana State Prison. as goods
manufactured by the jobber. accord
ing to dispatch from Washington
today.
The commission severely condemns
the arrangement between the Com
monwealth Manufacturing Company
of Chicago and the Indiana State
Prison trustees, whereby the Com
monwealth concern disposes of from
1900 to 10000 pounds of binder
twine and $4,000 dozen shirts a year,
and from fifty to sixty pairs of shoes
a day, all made within the prison
walls, under advertising and mark
ings indicating the goods were made
by the Commonwealth firm.
Unfair Competition Barred
The commission declares it found
that the Commonwealth firm, rather
than having a factory in Michigan
City, merely has an Office force and
outstanding capital stock of only
$4,000.
The unfair competition which
this imposes on jobbers and sales
agents who do not resort to such
practices is stressed by the commits
sion.
Indiana law requires that all
prison-made goods be plainly
marked as such and that any per-
son selling them must file $500 bond
and take out a license from the
State to engage in such business.
There is no record that this has
been done by the Commonwealth or
any other firm in Indiana.
Hits at. Methods
The trade commissions report
does not specifically call attention
to this Indiana law, but the COM
mission asserts tkat it found that
the Commonwealth concern was
using, in its advertising, such
phrases as Commonwealth Manu-
featuring Company, Manufactur-
ers," "Buy direct from the manu-
facturer," $3.50 dozen, F. o. B.
factory" Mills, Michigan City, In
diana"
The Commonwealth Manufactur-
ing Company is owned by Harry
Dushoff, excepting two shares OF
stock held by office employees for the
purpose of complying with in
corporation laws.
Dushoff began operations with the
prison about 1920, when E. ]. Fo-
garty was warden.
For years the State furnished the
material, machinery and labor OF
convicts, boxed goods and shipped
them to Dushoff's customers. All
that Dushof did was keep books and
collect.
Pocketed His Profits
When he collected, he paid the
State the manufacturing cost plus
some overhead, pocketing his profit
Three years ago this was changed
Dushof began furnishing the ma
terials for the shirts and some
equipment. Prisoners still box the
goods. Dushoff now pays monthly
for the manufactured goods and
they are shipped at his instructions
If the trade commissions order is
complied with, the State must
market it's surplus goods through
the regular State sales agency, es-
tablished for this purpose, or large
number of prisoners may be thrown
into idleness.
Roberts Answers
Henry Roberts, State sales agent
whose Office is supposed to dispose
of the products of all State institu-
tions, said that some of the prac-
tees complained of by the Federal
Trade commission have been discon-
tinued.
Roberts contends that his office
Is selling the entire binder twine
output of the prison to farmers OF
Indiana and the northwest, and that
all prison made shoes at present
are going to inmates Of other State
institutions.
He admitted that contracts where
by shirts are sold through private
agencies still are in existence.