In the Matter of the Complaint Against ARTHUR DAVID WILBANKS, a/k/a ARTHUR DAVID PEARCE, d/b/a ANDREWS ASSOCIATES, P. O. Box 13281, Station K, Atlanta, Georgia 30324 and WILBANKS, LIMITED, P. O. Box 645, Mableton, Georgia 30059 P.S. Docket No. 1/61April 21, 1972
James J. Robertson, Esq., and H. Richard Hefner, Esq. Law Department, U. S. Postal Service, for Complainant. William J. Hickey, Esq. of Mulholland, Hickey & Lyman, Esqs. , Washington, D. C., for Respondent. Before: John Lewis , Hearing Examiner.
This proceeding was initiated by the filing of a complaint by the General Counsel of the United States Postal Service on February 24, 1972, charging the above-named respondent1/ 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 3005. In substance, the complaint charges respondent with having made false representations concerning the ability of his product to gro hair on the chest and various other portions of the body. Respondent appeared by counsel and filed answer denying, in sub- stance, that he was conducting a scheme or device for obtaining money or property through the mail by means of false representations.
Pursuant to notice duly given, a hearing for the reception of evidence was convened on March 27, 1972, in Washington, D. C. Both parties were represented by counsel and were afforded full opportu- nity to be heard, and to examine and cross-examine witnesses. Counsel for complainant called three witnesses, (1) a postal inspector through whom they sought to establish that respondent's method of operation involved the obtaining of money through the mail by means of statements made in advertising, (2) a chemist through whom they sought to establish the ingredients contained in respondent's product, and (3) a physician through whom they 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 complainant's witnesses as establishing the failure of complainant's counsel to make out a prima facie case.
Pursuant to leave granted at the close of the reception of evidence, proposed findings of fact and conclusions of law were filed by counsel for complainant on April 11, 1972. No proposed findings of fact and conclusions of law were filed on behalf of respondent, counsel for said party having stated at the close of the hearing that he had not determined whether to file such findings. However, a motion was filed on behalf of respondent on April 14, 1972, stating that respondent's "finances are not sufficient to pay attorneys for opposing appeals" in this proceeding and, further, that respondent "no longer opposes the entry of such orders as may be passed against him". Since respondent has not withdrawn the answer filed by him herein and the issues were fully litigated at the hearing held herein, the motion filed on behalf of respondent does not obviate the need for the issuance of an initial decision and for such order as may appear to be appropriate.
After having carefully reviewed the evidence in this proceeding and the proposed findings and conclusions submitted by complainant, and based upon the entire record, including his observation of the witnesses, the undersigned makes the following:
FINDINGS OF FACT
A. The Alleged Solicitation of Money Through the Mail .
1. Respondent is engaged in selling a product which will purportedly promote the growth of hair on the chest and other portions of the body. Said product consists of a lotion or cream and directions for application (CX 3-B and C).2/
2. Public attention is attracted to respondent's product through advertisements placed in various magazines intended for circulation among men, including "Man's Magazine" and "Stag" (CX 1; Tr. 19). As part of his advertisements, respondent includes an order form to be used by prospective customers for ordering respondent's product through the mail. Such form requires the sending of cash or money order in payment of the order since, as respondent states therein: "Sorry no checks or C.O.D.s" (Ex. "A" attached to complaint). The record establishes that respondent does, in fact, obtain money through the mail from customers who have detached and mailed the order form, in payment of respondent's product (Tr. 20-1, 25-7; CX 2).
B. The Alleged Representations .
3. Respondent's advertising matter contains various statements concerning the efficacy of his product (CX 1). A copy of respondent's advertising matter, by which he solicits money through the mail, is attached hereto as Appendix "A".
4. The complaint alleges that respondent has made various representations to the public concerning the ability of his product to grow hair on the chest and other portions of the body (other than the head). From a review of the advertising matter which is in evidence, it is found that the ordinary reader viewing such advertisements would interpret them as making the representations, substantially, as set forth in the complaint, which representations are incorporated by reference herein as if fully set forth. In substance, the representations which are made through respondent's advertising matter are that respondent's product will (1) enable the user to grow hair on his chest, (2) will enable him to grow chest hair "regardless of age," (3) will "activate dormant hair follicles", (4) will make the reader a "hairy and masculine he-man", (5) will result in a "permanent" growth of hair and (6) will enable the user to have a "hairy chest, hairy legs, hairy arms, thick beard, sideburns, mustache, hairy stomach, body hair."
5. Counsel for respondent contended at the hearing that the representations made in the advertisements related to hair care and hair grooming, and that respondent made no representation that its product would grow hair where no hair existed (Tr. 12). However, from a reading of the advertisement as a whole it is clear, and it is so found, that respondent has sought to create the impression, and his advertisements do create the impression, that his product will result in the growth of hair on the portion of the body therein indicated. The thrust of the advertisements extend beyond the mere care and grooming of the hair, and encourage the reader to believe that respondent's product will enable him to grow hair on portions of the body therein referred to. For example, in one of the testimonial letters incorporated in the advertisements the following statement appears:
"For Years I Had No Chest Hair Or Hair On My Arms.
Now I Have Thick Dark Hair On My Chest And Arms]"
C. The Alleged Falsity .
6. The uncontradicted and credible testimony of the chemist, Mr. Sage, and the medical witness, Dr. Horvath (a specialist in dermatology), establish that the representations made by respondent, as above found, are materially false for the following reasons:
a. The testimony of the chemist establishes that respondent's product consists primarily of stearic acid, with small amounts of glycerin, triethanolamine, perfume and liquid petroleum (CX 4, 5; Tr. 35-6). The ingredients of such product are essentially those found in hand lotions (Tr. 40-1).
b. Dr. Horvath, a Board-certified dermatologist with extensive experience in cosmetic dermatology, testified that none of the ingredients in respondent's product will have any effect in the growth of hair on any portion of the body. There are no drugs which will induce hair follicles to grow where there are no follicles nor, with one exception, are there any known drugs which will stimulate the growth of hair in humans even where there are hair follicles. The one exception involves the use of male hormones in massive dosages which have produced an increase in the growth of hair in arm pits (Tr. 62-4). Since, according to Mr. Sage's testimony, there are no steroids or male hormones in respondent's product it will have no effect on the growth of hair, even in the arm pits (Tr. 65-6).
c. The directions for the application of respondent's product prescribe massage, the use of exercises and the avoidance of certain foods as promoting hair growth (CX 3-C). However, according to Dr. Horvath's testimony, no amount of normal massage, exercise or dietary regimen will result in the growth of hair where there are no hair follicles. Moreover, even in healthy individuals with hair, there is a tendency for it to fall out or become dormant with advancing age and there are no known drugs which will reverse this process (Tr. 64, 67-70).
d. According to Dr. Horvath's expert oi(-WEST-)pinion the use or respondent's product and method will not (1) give a man a hairy chest if he does not have one, (2) make his chest hairier if he has a little hair on his chest, (3) produce hair growth regardless of age, (4) help to activate dormant or inactive hair follicles, (5) result in the growth of permanent hair, (6) cause an individual to develop a hairy chest, hairy legs, hairy arms, thicken his beard, develop sideburns, grow a mustache, produce a hairy stomach or body hair (Tr. 72-4).
7. Counsel for respondent conceded during the hearing that respondent's product would not grow hair where none existed, but contended that his advertisements related to hair care and grooming, rather than to the growth of hair (Tr. 12). As has been heretofore found, respondent's advertisements extend beyond the mere grooming of the hair, and encourage the belief that his product will result in the growth of hair on various portions of the body. This, according to the uncontradicted expert testimony, it will not do. Counsel for respondent also contended that there was no misrepre- sentation in view of the "money back guarantee" contained in the advertisements. However, a false representation is not dissipated by the fact that dissatisfied customers may obtain a refund.3/
CONCLUSION OF LAW
Respondent is 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 3005.
It is accordingly recommended that an order in the usual form, as provided in 39 U. S. Code 3005, should be issued.
_________________
1/ It was stipulated at the hearing held herein that the two individuals named in the complaint are one and the same individual, doing business under the above names and at the above addresses.