In the Matter of the Complaint Against DEVELOPMENT RESEARCH, 210 Fifth Avenue at New York, New York 10010 INITIAL DECISION OF HEARING EXAMINER P.S. Docket No. 1/36 January 17, 1972 Daniel S. Greenberg, Esq., Law Department, U. S. Postal Service, for Complainant. Sidney Schreiberg, Esq., New York, New York, for Respondent. Before: John Lewis, Hearing Examiner.
This proceeding was initiated by the filing of a complaint by the Senior Assistant Postmaster General and General Counsel of the United States Postal Service on November 11, 1971, charging the Respondent, Development Research, with conducting a scheme or device for obtaining money or property through the mail by means of false representations, in violation of 39 U. S. Code, Section 3005. In substance, the complaint charges Respondent with having made false representations concerning the nature of its product which it described in its advertisements as "Formula LDX-33," and specifi- cally concerning the ability of said product to favorably affect a man's sexual desire and his capacity for sexual activity. Respond- ent appeared by counsel in this proceeding and filed an answer in which it denied the allegations of the complaint.
Pursuant to notice duly given, a hearing for the reception of evidence was convened on December 22, 1971, in Washington, D. C. Both parties appeared by counsel and were afforded full opportunity to be heard and to examine and cross-examine witnesses. Counsel for Complainant called two witnesses, (1) a postal inspector through whom he sought to establish that Respondent's method of operation involved the obtaining of money through the mails by means of statements made in advertising and (2) a physician through whom he sought to establish the falsity of the representations allegedly made in Respondent's advertising matter. Counsel for Respondent elected not to offer any testimony or other evidence, but relied on the cross-examination of the Government's medical witness as establishing the failure of Complainant's counsel to establish a prima facie case, and also upon the failure of the advertising matter to contain certain of the representations alleged in the complaint.
By order issued December 17, 1971, the Hearing Examiner conditionally granted a motion by Counsel for Complainant for an oral decision pursuant to Section 952.24 of the Rules of Practice, to the extent that the Hearing Examiner would issue such a decision if, at the close of the reception of evidence, he deemed it appropriate to issue such a decision in lieu of a written initial decision. After having carefully heard the evidence, the Examiner concluded that it would be appropriate to issue an oral decision.
After having carefully considered the evidence in this proceeding, and based upon the entire record, including the complaint and answer, the exhibits, and the testimony of the witnesses, I make the following decision:
FINDINGS OF FACT
A. The Alleged Solicitation of Money Through the Mail .
1. Respondent is engaged in the business of selling certain tablets which it designates in its advertising matter as "Formula LDX-33". Public attention is directed to such said tablets by direct mail advertising sent to potential customers. As part of said direct mail advertising, Respondent includes an order form for use in ordering the said tablets.
2. The order form supplied by Respondent requires that customers ordering the tablets must enclose cash, check, or a money order. The record establishes that Respondent does, in fact, obtain money through the mail from customers who complete the mail the order form together with payment for Respondent's product.
B. The Alleged Representations .
3. The offer to sell Respondent's product is made in a leaflet which has been received in evidence in this proceeding as Complainant's Exhibit 1-a and b. The leaflet contains a number of statements regarding the ability of a Respondent's product to affect the sexual desire, power, and activity of the users of the product and contains references to so-called case histories of individuals who have used the product and have had their sexual interest, activity, and performance significantly and markedly improved and restored.
4. The complaint alleges that through the use of the advertising matter sent to potential customers, Respondent has made various representations concerning the ability of its product, "Formula LDX-33," to restore or increase sexual activity, and concerning the nature of said product as affecting sexual interest and activity, and the nature of Respondent's organization. From a review of the advertising matter which is in evidence, I find that the ordinary individual receiving this literature in the mail would interpret it as making the representations, substantially, as set forth in the complaint which representations are incorporated herein by reference as if fully set forth. In substance, the representations which are made through the advertising matter are, (1) that the user of "Formula LDX-33" will be able to restore any lost sex interest, ability or fertility, as alleged in the complaint, regardless of the cause of his lack of sex interest; (2) that this product is a newly-discovered combination of ingredients differing materially from other products presently available on the market; (3) that the combination of ingredients used in the "Formula LDX-33" is specifically designed to nourish the sex organs; (4) that the restoration or improvement or increase in sexual interest and activity will be permanent; and (5) that the Respondent is conducting a bona fide research laboratory engaged in research pertaining to sexual adequacy.
5. There is no serious dispute as to the fact that the advertising matter does make the representations set forth in sub- paragraph (a) of paragraph 3 of the complaint. It has been contended that there is no specific representation that this formula is a newly-discovered formula, as alleged in subparagraph (b), but I think that it is clear from the context of the advertising literature as a whole, that this impression is sought to be created by such references in the literature to "one of the most spectacular and exciting developments in the history of science" and other references that have been alluded to by Counsel for Complainant. It is also contended that there is no representation that this formula is designed specifically to nourish the sex organs rather than the entire body, as alleged in subparagraph (c). However, it is clear from the context of the advertisement or brochure that the principal thrust of the literature is to create the impression that these ingredients are something more than a multiple vitamin to tone up or improve the body, but rather that they are directed specifically to improve or nourish the sex organs and to result in the restoration of deficient sexual activity or the improvement of sexual activity. I think it is also clear that the literature seeks to create the impression and does create the impression, as alleged in subpara- graph (d), that the benefits which are attained from the use of this product will be permanent and are not merely a temporary pallia- tive. While there is nothing in the literature referring to the nature of Respondent's organization, the use of the name Development Research in its trade name would, I believe, create the impression on the part of the average user, that he is dealing with refers to a product claiming to improve sexual activity, the reader would be led to believe that this is the nature of the research conducted by the laboratory. It is accordingly found that the advertising material, which is attached to this decision as Appendix "A", does make the representations set forth in the complaint.
C. The Alleged Falsity of the Representations .
6. It is my finding that the uncontradicted and credible testi- mony of Dr. Vincent Cordaro establishes that the representations made by Respondent, as above found, are materially false. While it may be, as Counsel for Respondent contends, that Dr. Cordaro is not the foremost expert in the field of sex diseases or urology or matters pertaining to sex, he is a qualified physician and sufficiently knowledgeable in the field about which he testified to justify the crediting of his testimony in the absence of counter- vailing medical expert testimony, or other testimony, possibly consisting of testimony of users, of such a persuasive nature as to justify disregarding Dr. Cordaro's testimony. The testimony of the doctor establishes that the representations made by Respondent, as above found, are materially false for the following reasons:
a. The "Formula LDX-33" tablet is essentially a multi- vitamin capsule which will have no direct beneficial effect on sexual capacity, ability, vitality, desire, interest, fertility, or the ability to attain or retain an erection or prolong an orgasm.
b. At best, the product may serve to improve a person's general health in those instances where he is suffering from multi- vitamin deficiency and, to the extent that his impairment of health has affected his sexual activities or desires, the product could conceivably have some beneficial effect. However, this is an indirect and atypical result of the use of these tablets. The instances where individuals suffering from vitamin deficiencies also suffer from impairment of sexual activity or capability are not frequent. Furthermore, to the extent that such individual's sexual activities are impaired as a result of vitamin deficiencies or lack of health due to vitamin deficiencies, the use of multi-vitamin capsules would only be a portion of the regimen of treatment for such persons.
c. The testimony of the doctor establishes that the principal causes of impotence and the loss or lessening of sexual activity are psychosomatic, heredity, diseases of the sexual glands and ill health. While malnutrition may, as previously found, result in some instances in a decrease in sexual activity or interest, it is not a principal cause thereof.
d. While it may be that there may be some individuals who could conceivably be helped by the use of these tablets in those instances where their lack of sexual interest is due to vitamin deficiency, or in those instances where it is of a psychosomatic origin and the individual may conceivably believe that these tablets will help him, this would occur in only a limited number of cases and does not establish the truth of the representations made in the advertising matter. The tablets are not advertised and sold as multi-vitamin tablets which may have a derivative beneficial effect by improving the general health, and are not sold as a placebo, but are specifically sold as a product which will have a direct and specific effect in the improvement or restoration or promotion of sexual capacity, ability, vitality, desire, fertility, and prowess. This is the entire thrust of the advertising and of the representa- tions made therein.
e. The uncontradicted testimony shows that the tablets contain no ingredients which will rejuvenate the sex glands or stimulate hormonal activity or will in any way have any direct beneficial effect on the sex glands and sex activity. The thrust of the advertising is that the product will directly improve sexual interest, desire, capacity and prowess, and not merely that they will improve one's general health and thereby, in those limited number of cases where sexual activity has been affected by a decline of general health, help improve sexual activity. While there are certain drugs which have been mentioned by the doctor which do control and affect the sex glands, none of them are contained in Respondent's product. All of the drugs referred to by the doctor require a prescription by a physician.
Respondent has engaged in conducting a scheme or device for obtaining money or property through the mail by means of false representations, in violation of 39 U. S. Code, Section 3005. It is accordingly recommended that an order in the form provided for in 39 U. S. Code 3005 should be issued.
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