In the Matter of the Petition by ) February 24, 1960 ) NATIONAL ASSOCIATION OF TRAILER ) OWNERS, INC. ) ) at ) P.O.D. Docket No. 1/144 ) 1359 Main Street ) Sarasota, Florida ) ) for a hearing upon its application ) for second-class entry of "THE ) MOBILEHOME OWNER." ) APPEARANCES: W. Byron Sorrell, Esq. and Garland P. Thompson, Esq. White, Sorrell and Williamson 1100 New Hampshire Avenue, N.W. Washington 7, D. C. Attorneys for the Petitioner Adam G. Wenchel, Esq. Dean M. A. Murville, Esq. for the Director of the Postal Services Division Ablard, Charles D. POST OFFICE DEPARTMENT WASHINGTON 25, D. C.
This is a review of a proposed denial of second-class entry for the magazine "The Mobile Home Owner," published by the National Association of Trailer Owners, Inc. The proposed denial was issued on February 11, 1959, by the Director of the Postal Services Division of the Bureau of Operations of the Post Office Department because he found that the publication was designed primarily for advertising purposes. The statute provides:
"Nothing herein contained shall be so construed as to admit to the second-class rate regular publications designed primarily for advertising purposes...." (39 U.S.C. § 226)
The Post Office Department has promulgated a regulation based on this section of the code. It provides:
"Publications designed primarily for advertising purposes may
not qualify for second-class privileges. They include:
a. Those having advertising in excess of 75 percent in more than one-half of their issues during any 12-month period.
b. Those owned or controlled by individuals or business concerns and conducted as an auxiliary to and essentially for the advancement of the main business or calling of those who own or control them. 1/
c. Those that consist principally of advertising and editorial write-ups of the advertisers.
d. Those that consist principally of advertising and that have only a token list of subscribers, the circulation being mainly free.
e. Those that have only a token list of subscribers and that print advertisements free for advertisers who pay for copies to be sent to a list of persons furnished by the advertisers.
f. Those published under a license from individuals or institutions and that feature other businesses of the licensor." (?132.226 Postal Manual)
As the basis for his proposed denial the Director cited section (b) of the regulation.
A petition was filed by the publisher on April 13, 1959, appealing from the ruling of the Director. A hearing on the matter was held before Hearing Examiner William A. Duvall who rendered an Initial Decision in which he found that the publication was designed primarily for advertising purposes but that it was not:
"designed primarily for the purposes of advertising the National Association of Trailer Owners, although that is quite obviously one of the purposes."
He went on to find that:
"This record is clearly convincing, however, that the publication is designed primarily for the purpose of advertising manufacturers of mobilehomes and mobilehome equipment and accessories." 2/
He found that the publication was the advertising medium used by a second organization, the Mobile Home Dealers National Association, an association of retail sales outlets.
The Mobile Home Owner is a publication devoted to the interests and for the benefit of the mobile-home industry. It would appeal to those who either own or are interested in the purchase of a mobile home, those who manufacture and those who sell the homes. The industry is a rapidly growing one. Most of the advertising in the publication is by mobile home manufacturers and dealers but other advertisements are also carried. The stories, articles and editorials feature the problems and advantages of having a mobile home.
The petitioner has filed six exceptions to the findings of the hearing Examiner. All of these are concerned with the ultimate question of whether this publication is designed primarily for advertising purposes. No exceptions were filed by the Director. Oral argument on appeal was presented before the Judicial Officer on January 20, 1960. Counsel for the Director there stated that he did not believe that the Hearing Examiner had held against the Director on the question of whether the publication was a house organ of the National Association of Trailer Owners but had only held that it was also used to advertise the Mobile Home Dealers National Association. Therefore he was still relying in part on section (b) of the regulation. For the publication to fall within the purview of that section it must be published "essentially for" the owner and controller. Although the Hearing Examiner used different language from that of the regulation, his finding does not support the conclusion that the publication falls within the regulation. The examiner having so found and no exception having been taken to his finding by the Director this issue is not before me.
The petitioner in his oral argument invoked the maxim of construction "expressio unius est exclusio alterius", the expression of one is the exclusion of others, saying that when the Director enumerated the six categories in the regulation this enumeration excluded all publications not falling within one of those categories. To so interpret the regulation would be to say that the Department by regulation could place a limitation on the scope of an Act of Congress. The Department could no more do this than it could add to the statute by regulation. Payne v. Railway Publishing Co., 20 App. D.C. 581 (C.A.D.C., 1902). The Congress has prohibited all publications which are "primarily for advertising purposes" from entry to the second-class, a form of federal subsidy to qualifying publishers. Hannegan v. Esquire, 327 U.S. 146 (1946). An enumeration of certain categories preceded by the words "They include" does not support the conclusion that the Department intended to exclude all other categories. People v. Lim, et al., 111 P.2d 429 (1941).
The petitioner in oral argument on appeal argued that the Hearing Examiner misconstrued the facts and evidence as to the Mobile Home Dealers National Association since most of the advertisers in the publication are not members of that association but are members of a third association, the Mobile Home Manufacturers Association. So long as the publication is not one "essentially for" the advancement of the owner corporation it does not fall within the purview of section (b) of the regulation. The question is irrelevant in view of the finding of the examiner that the publication is designed primarily for "the purpose of advertising manufacturers of mobile homes and home equipment and accessories." This is equivalent to a finding that the magazine is primarily used to advertise the services and wares of these three organizations or any others which may be in existence and not just one. It is the correctness of this conclusion that we now reach.
The only pertinent decisions on this question were rendered before the turn of the last century. Despite their age they enunciate principles which are applicable to today's facts and circumstances. In 1877 the First Assistant Postmaster General in interpreting the section of the Act of July 12, 1876, which was equivalent to the present statute, held that "The Iron Age," and "Metal Worker" were not publications designed primarily for advertising purposes. He said:
"Under the indomitable spirit of enterprise which has ever characterized the business interests of this country, of late years those engaged in certain trade pursuits have resorted to the expedient of printing or having printed certain publications devoted mainly to the advertisement of their business or trade.******
"There may be a presumption in favor of all publications of this character which show a bona fide subscription list and which are published at rates other than nominal, but it is a presumption which is often overcome by careful diagnosis." (1 Opinions of the Assistant Attorneys General for the Post Office Department, 313)
On November 17, 1877, in another opinion, the Acting Assistant Attorney General for the Post Office Department discussed advertising publications saying:
"These publications may be divided into five classes, described as follows:
First. Those publications originated and published for the dissemination of information upon some special subject, or devoted to the interests of some special industry, having a legitimate list of subscribers and being conducted so as to attract more. Notable instances of this class are The Iron Age, The American Grocer, The Shoe and Leather Reporter, and the Publishers' Weekly, of New York; The Trade-List of Cincinnati; and The Northwestern Lumberman and The Hardware and Implement Trade Review, of Chicago. There can be no question but what publications of this character should be regarded as equally entitled to all the benefits of the "privileged" class as the leading metropolitan dailies of the country.
Second. Those publications owned and controlled by one, or in many cases several, business concerns, and conducted solely for the advancement of the business or trade of those who own them. Their subscription-price is nominal and they are of no public benefit. To this class may be assigned Baldwin's Monthly, the Leader, published by Rogers, Peet & Co., and Vogel Brothers' Monthly, all of New York City; the Commercial Reporter, of Brooklyn; the Trade Price-List, of Nashville, Tenn., and the Mirror of Fashion, of Kansas City.
Third. Those publications which, having no genuine nor paid-up subscribers, insert advertisements free on the condition that the advertiser will pay full price for from two hundred to one thousand papers, which are sent to persons whose names are given to the advertiser upon a printed list. Among publications of this character may be mentioned the New York Jobbers' Price-Current, and the Commercial Gazette, of New York. 3/
Fourth. Those publications which do desire advertising only. Such do not want subscribers, so as not to be compelled to issue their publications regularly. If the probable receipts are not likely to exceed the expenses, the publication will be deferred for a week or so. The space in their columns allotted to reading matter is filled with long editorial puffs of houses or individuals, who buy a certain number of copies for distribution, and pay a sum previously agreed upon. The New York Trade-Journal and the New York Trade Reporter are publications of this class.
Fifth. Pamphlets containing market quotations and the business-cards of various business-houses opposite the page containing the quotations. They have a subscription price which cannot be regarded as nominal, and are sent to bona-fide subscribers, who are usually retailers living in the smaller cities and towns of the country. As belonging to this class, I may mention the Saint Louis Weekly Dry Goods and Grocery Reporter and Sheldon's Weekly Dry Goods Price List of New York City. Publications having the characteristics or falling within the description of these latter four classes do not come within the requirements of "privileged matter" in the mails. They are not useful as vehicles of accurate thought, nor are they intended for the instruction or entertainment of the people. They are purely personal enterprises and should pay their way as nearly as possible through the mails." (Annual Report of the Postmaster General, 1877, page 242.)
It should be noted that the language of this enumeration, unlike the one contained in the present day regulation, indicates that it is intended to be all inclusive. While the Department could not limit an Act of Congress, supra page 4, I see no reason to enlarge these categories to establish an entirely new catch-all category absent a showing by the Director that, possibly because of changes in the publishing industry, expansion is needed.
"The Mobile Home Owner" appears on its face to fall into either the first or the second category. The second category requires that the publications be "owned and controlled" by one, or in many cases, several business concerns and conducted solely for the advancement of the business or trade of those who own them. The Hearing Examiner found that "The Mobile Homeowner" was not published primarily for the advancement of the business or calling of the owner, the National Association of Trailer Owners. There is no proof that The Mobile Home Dealers Association owns or controls either the owner association or the publication. In fact the evidence shows the contrary. At the hearing no mention was made of the Mobile Home Manufacturers Association. It thus appears that the publication does not fall into the second group but rather is a form of trade journal thus falling into the first category along with "The Iron Age," "The American Grocer", and "The Northwestern Lumberman." The publication is, in fact, just that, a trade journal of the mobile home industry containing news information and advertisements for manufacturers, dealers and users. The fact that these organizations advertise liberally in its columns does not make the publication one primarily for advertising purposes.
The contents of a letter of March 25, 1879 from the Postmaster General to the Attorney General requesting an interpretation of the meaning of the "advertising" part of the statute offers another reason for the holding. The Postmaster General recited examples of publications which had been ruled upon by the Department saying:
"Semple's Ladies Journal, the Leader, The National Tribune, (No. 1), The Citizen Soldier, 4/ Leffel's Milling News have been held to be regular publications designed primarily for advertising purposes. The following named publications have been held not to be within the statute: The Iron Age, Shoe and Leather Reporter, The Dry Goods Bulletin, The National Tribune (No. 2), the Scientific American.*****"
"In the case of The National Tribune No. (2) it was held that the transfer of the paper from the control of the former editor to a company, thus separating the editorial management of the paper from the Claim Agency so liberally advertised in its columns, took it out of the rule." (Postmaster General Letterbook 21 in custody of the Industrial Branch, National Archives and Records Service, General Services Administration.) 5/
In the Postmaster General's discussion about "The National Tribune" he indicates that he reason for holding that it was not primarily for advertising purposes was that the editorial management of the paper had been separated from the organization which liberally advertised in its columns. A similar situation prevails here since the owner and publisher of "The Mobile Home Owner" is separate from both the Dealers Association and the Manufacturers Association which so liberally advertise in its publication and benefit the most from it. It was shown that the owner, The National Association of Trailer Owners, advertises very little in the publication and has little to gain by so advertising. The principal endeavor of that organization is publishing the magazine.
The Director seeks to rely on the corporate charter of the association saying that the broad scope of power granted to it by the state shows that the publication is for the advancement of the association. This argument is specious since it is the state of facts extant about the corporation and set its general powers which is determinative of the question at issue.
The publication is not one primarily for advertising purposes within the purview of the statute and it is entitled to the second-class entry. The Initial Decision of the Hearing Examiner is reversed and the entry is granted.
1/ This Department has held that a program guide which was a house organ owned and controlled by a radio station was essentially for the advancement of that radio station and thus one primarily for advertising purposes. (High Fidelity Broadcasting Corporation, Post Office Department Docket 1/8, Nov. 3, 1958) It has also held that a radio program guide which was principally published for free distribution by druggists to advertise their drugstores was one primarily for advertising purposes. (Channel Northwest, Hearing Examiner Docket 5/178, May 23, 1958)
2/ The National Association of Trailer Owners is not a manufacturing company but is, as its name implies, an association of owners. The principal endeavor of the association, however, is the publishing of "The Mobile Home Owner" and not the administration of the association or servicing its members. The examiner found this as a fact and no exception to it was taken by the Director.
3/ The Channel Northwest publication, supra Footnote 1, was a variant and combination of categories two and three.
4/ This publication was owned and controlled by a person who used it to acquire clients for the collection of claims and pensions. 1 Opinions of the Assistant Attorneys General of the Post Office Department 400.
5/ The Assistant Attorney General answered this inquiry on April 15, 1879, saying that he could offer no more in the way of interpretation than had been given by the Assistant Attorney General. (16 Opinions of the Attorney General 303).