In the Matter of the Complaint That ) March 2, 1966 ) THERAPEUTIC AIDES, INC. ) ) at ) ) Cleveland, Ohio, ) P.O.D. Docket No. 2/202 ) (hereinafter called Respondent), is ) engaged in conducting a scheme for ) obtaining money through the mails in ) violation of 39 U.S. Code 4005. ) APPEARANCES: Mayo H. Roberts, Esq. Office of the General Counsel Post Office Department for the Complainant Marion Edwyn Harrison, Esq. Reeves, Harrison, Sams & Revercomb Washington,D.C. for the Respondent Bosone, Reva Beck
In the above-named case the Complainant has charged the Respondent with violating 39 U.S. Code 4005. 1/
Counsel for the Respondent in his Brief on Appeal stated that the Initial Decision was confused in the Findings of Fact--that whether the findings and conclusions stated by the Hearing Examiner are "the type of 'proposed findings' contemplated by the Administrative Procedure Act, 5 USC § 1007(b)(1), is highly doubtful." I believe that the findings set out in the Initial Decision are in keeping with the intent of the Administrative Procedure Act and are most clearly stated "upon all the material issues of fact," Title 5 U.S. Code § 1007(b).
Dr. William J. Evans testified for the Post Office Department. Dr. Evans has been a member of the American Medical Association, the District of Columbia Medical Society, a Fellow in the Washington Gynecological Society, and a Fellow in the Georgetown Clinical Society. He was also associate head of the Department of Obstetrics and Gynecology on the teaching staff of Doctors Hospital. At present he is with the Food and Drug Administration as Deputy Director of the Division of Medical Review in the Bureau of Medicine. He stated that gynecology and obstetrics cover the female sexual parts. There is no doubt about his qualifications--Tr. 17.
Based on his experience and training he stated the causes of marital dissatisfaction and problems can be either psychological or physical--Tr. 20.
When the doctor examined the device, the "Erect-Aide"--the subject of this case--and the instructions for its use, he said it "would not eliminate the cause of unsatisfactory sexual relations between the marital partners if the male was otherwise unable to perform the sexual act." Tr. 21. He also testified that this
device would not eliminate the trouble in the marital sexual relationship due to a frigid or a non-responsive wife. He testified further that he knew of no man who would advocate that this device would be effective for curing marital sexual dissatisfaction. He went on to explain that the device could be very hazardous if the female partner had passed the menopause--that if the entrance of the vagina were lacerated the blood vessels in that area could cause continuous bleeding. Tr. 23. He explained in detail the ineffectiveness and lack of safety in the device, "Erect-Aide." In his testimony he said that the claims disclosed by Complainant's Counsel are wholly unsupportable by a "one hundred per cent--that he knew of no scientific opinion to the contrary. Tr. 28.
The doctor explained that he knew of no one who uses "Erect-Aide" so the basis for his testimony was on his clinical experience.
Mr. Fred Herman testified for the Respondent. He is a partner in the Fre-San Products Mfg. Co. that manufactures the "Erect-Aide" product and the device known as the C.T.D. device--Respnodent's Exhibit 1. The Fre-San corporation also distributes the latter device but has a contract with Therapeutic Aides, Inc., for distribution of the "Erect-Aide." Almost all of Mr. Herman's testimony was on the C.T.D. device which he has manufactured since 1959 and which is approved by the Food and Drug Administration and sold to the medical profession, drug stores, doctors, surgical supply houses, and wholesale drugs.
The Respondent failed to produce a witness who refuted Dr. Evans' testimony except that of Jackie Presser--who used the device and found it beneficial. The emphasis of the Respondent's case rested on Mr. Herman who described in detail the C.T.D. device and its sales procedure. This decision hereby sustains that of the Hearing Examiner relative to the material facts set out on pages 5 and 6 of his decision--that the representations herein described are false.
An observation of the two devices will show that they are composed of the same plastic material, but they are different in that the wall of the device, C.T.D., is thinner and softer, more flexible, and is straight and has a different type of attachment from that of the "Erect-Aide." The C.T.D. device is inspected now and then by the U.S. Food and Drug Administration. It cannot be purchased promiscuously. The "Erect-Aide" has a slight curve and a different means of attachment, but the walls are thicker causing the device to be inflexible. An examination of the two devices clearly shows an important difference.
Mr. Jackie Presser, the Respondent, said that he was the sole operator of Therapeutic Aides, Inc.--that he was the distributor of "Erect-Aide." He said that he and Mr. Herman were friends and that he had seen the C.T.D. device and was aware that it was sold only as described above and that it was inspected now and then by the U.S. Food and Drug Administration. Mr. Herman had shows him many letters from various doctors who had ordered the device. Mr. Presser was interested sufficiently to acquire four circulars--Respondent's Exhibits 6, 7, 8, and 9--which included the advertising of devices through the mail--devices which he thought
were similar to his. Mr. Presser under contract became the distributor of the "Erect-Aide" about in 1964. He sold 180 but when he received the Post Office Department's complaint he ceased all advertising operations.
Mr. Presser is a distributor of truck bodies and automotive lines in Cleveland, Ohio. His formal education extended to the tenth grade. The fact that he is a distributor of truck bodies and automotive lines shows that he has a certain business acumen. But Counsel for the Respondent would have one believe Mr. Presser is naive and unsophisticated--that his activity in relation to "Erect-Aide" displays no intent to defraud.
The representations and the receiving of money through the mail for the device are admitted by Respondent's Counsel but he denies the allegation of intent to defraud on the ground that Mr. presser relied solely on the guide lines with which he became familiar through his friend, Mr. Fred Herman.
Mr. Presser knew the procedure that his friend, Mr. Herman, followed and he also knew that "Erect-Aide" was different from the C.T.D. device and since "Erect-Aide" could be purchased by anyone he was put on notice that he should have submitted his product to medical attention and to the Food and Drug Administration. I see no defense in the intent argument as propounded by Respondent's counsel--that the guide lines followed by Mr. Herman led Mr. Presser to believe that he didn't need to follow the procedure adopted by Mr. Herman. It seems to me it was very clear that Mr. Presser should have learned from Mr. Herman and proceeded in the same way. With Mr. Presser's experience in business, I repeat that I do not believe he was naive in the selling of the "Erect-Aide."
I believe I can apply here what I said in one part of my decision in Medical Sales Corp., P.O.D. Docket No. 2/88, that "The Respondent, if he didn't know, has a duty to learn the effects of the use of this device. Stone v. U.S., 113 F.2d 70 (1900). It is not something that is used on the surface of one's body--the results of which can't be seen by a layman. To entice a person who has a problem that he thinks or she thinks can be remedied by a device that fails to carry out the claims of the advertisements and can be dangerous to one's health is a fraud." There is an intent to defraud.
The representations referred to in the foregoing are false and there is a fraudulent intent. The Respondent is conducting a fraudulent scheme in violation of 39 U.S. Code 4005 in having obtained remittances of money through the mails by means of false and fraudulent representations. A fraud order is hereby issued.
1/ The basic statute, 39 U.S. Code 4005, reads so far as here pertinent:
"Upon evidence satisfactory to the Postmaster General that any person is engaged in conducting a scheme or device for obtaining money *** through the mail by means of *** fraudulent *** representations ***; the Postmaster General may--
(1) direct postmasters at the office at which registered letters or other letters or mail arrive, addressed to such a person or to his representative, to return the registered letters or other letters or mail to the sender marked 'fraudulent'; and
(2) forbid the payment by a postmaster to such a person or his representative of any money order or postal note drawn to the order of either and provide for the return to the remitters of the sums named in the money orders or postal notes.