PIP Says It Is Target of Federal Trade Commission Inquiry : Printers: The panel is investigating whether the Agoura Hills-based company violated its disclosure rule by not giving franchisees enough support services.

PIP Printing, an 825-store printing and photocopying franchise based in Agoura Hills, is under investigation by the Federal Trade Commission for possible violations of its franchise disclosure rule, the company has confirmed.

Carol LaPorta, senior vice president of marketing and business development for PIP, said government investigators are seeking to discover whether the company violated its contract with franchisees by not providing them with enough support services, such as advertising or training.

But LaPorta said the FTC has led the company to believe that the investigation has not turned up any violations. PIP, she said, has been under investigation by the agency since 1988, when some of its franchisees filed formal complaints.

Formerly called Postal Instant Press, PIP was founded by Los Angeles commercial printer Bill Levine in 1968.

Levine was an early entrant into the franchise field, in which an entrepreneur sells a business concept to a would-be small business owner, who then uses the name and ideas of the seller, or franchiser, to set up shop.

Eileen Harrington, the FTC’s associate director for marketing practices in Washington, D.C., would not discuss the investigation, or even confirm that it was going on.

But Harrington said the agency has made a point of investigating franchisers since the mid- to late 1980s. The FTC, she said, is concerned that the mushrooming number of businesses selling franchises might not tell the buyers about all possible risks. In addition, she said, some franchisers do not live up to the promises that they make to franchisees.

In the case of PIP, LaPorta said several complaints were filed, most of them saying that PIP did not live up to its obligations to franchisees.

But LaPorta said the company does not believe that the complaints against it are warranted, and that PIP had recently reduced its royalties.

Currently, to open a PIP store, a franchisee must pay a fee of $40,000 to PIP, plus royalties ranging from 2% of monthly revenue if the franchisee brings in more than $2 million per year, to 7% if the store brings in less than $150,000.

LaPorta said people who buy PIP franchises are offered free training on how to run a business, free sales and marketing consultation, and free television and radio commercials to use in local markets.

For national advertising, she said, PIP has produced seven broadcast spots and plans for them to be shown 1,130 times on TV this year.

To pay for producing and airing the ads, PIP requires store owners to pitch in 1% of their revenue, then the parent company matches that amount. The company also provides stores with flyers for use in direct mail campaigns.

Unlike some franchise operations, PIP’s corporate arm does not own or operate any stores--they are all franchises, LaPorta said.

“Yes, there are disgruntled franchise owners,” said Carol Silver, who owns two PIP stores, one in Van Nuys and one in Sun Valley. But Silver said she is happy with the services provided by PIP, and suggested that the people who complain simply do not work hard enough to make their stores profitable.

“Every time I turn around, we have new customers,” Silver said. “People will show up in our shop because they trust the PIP name.”

Michael Bluestein, who owns a PIP store in Encino, said that when his store burned down last summer, PIP’s corporate office “went to bat for me.” PIP allowed him to use its corporate printing facilities free of charge for seven months, Bluestein said, and the company’s marketing department helped draw up letters to his customers explaining about the fire.

But other franchisees have complained about the company.

John Mendolia, a former president of the PIP Owners Assn. and a former owner of two franchises, told The Times three years ago that the company was not responsive to franchisee concerns.

He also complained that the company charged too much in royalties.