In the Matter of the Petition by ) April 20, 1973 ) MARVIN LEVIN, PUBLISHER ) 8453 S.W. 132nd Street ) Miami, Florida 33156 ) ) Denial of Application for Second- ) Class Mail Privileges for "EXECUTIVE ) BEVERAGE JOURNAL" ) P.S. Docket No. 1/28 APPEARANCES: Marvin Levin, pro se 8453 S.W. 132nd Street Miami, Florida 33156 Petitioner Arthur S. Cahn, Esq. Law Department United States Postal Service Washington, D.C. 20260 for Respondent Wenchel, Adam G.
This proceeding is before the Judicial Officer on a motion by the Director, Mail Classification Division, for reconsideration of the Postal Service Decision entered on March 8, 1973.
Respondent presents the following two grounds for reconsideration:
1. 39 C.F.R. 125.5(b) (§ 125.52 PSM) supplies the regulation, defining paid advertising in the context of this case, that the Postal Service Decision said was lacking; and
2. Contrary to the statement in the Postal Service Decision, the issue of periodicity was before the Administrative Law Judge in this proceeding and, therefore, should have been considered by him and the Judicial Officer.
Essentially the question involved in the first ground is whether matter paid for as advertising in one publication is to be considered advertising when printed in another publications solely for the benefit of the publisher. The Postal Service Decision resolved this question against Respondent insofar as the publication involved here is concerned. In reaching that result the Decision stated:
"Under the circumstances of this case and without the aid of clarification by regulation, I must accept the Administrative Law Judge's conclusion that the publisher's testimony in this regard should be credited and conclude as did the Administrative Law Judge that the publisher has shown that the price lists are not advertising in EBJ." (Postal Service Decision, p. 5)
Respondent urges, as he did in his brief on appeal, that 39 C.F.R. 125.5 (§ 125.52 PSM) is a clarifying regulation. The motion states on page 1:
"Pursuant to USPS regulation § 125.52 Postal Service Manual (39 CFR 125.5(2)(b)) if a publisher is paid to publish material in one publication owned by him, the material is advertising matter if he publishes it in any other publication owned by him. Consequently, it is the Postal Service's contention that when the price lists appear in EBJ they are paid advertising matter."
Presumably Respondent derives that conclusion from the first two sentences of the cited regulation which state:
"125.52 DEFINITION OF ADVERTISEMENTS
The term advertisements includes display, classified, and all other forms of advertisements. The term also includes any editorial or other reading matter for the publication of which money or other valuable consideration is paid, accepted, or promised."
The problem is that it has not been established that the publisher in the instant case has been paid for publication in Executive Beverage Journal (hereafter EBJ) of the price lists. There is nothing in the regulation to suggest that the payment it refers to means payment for publication elsewhere than in the periodical under consideration. 1/ The cited regulation, therefore, is no aid in establishing Respondent's contention.
The May 19, 1971, denial letter states:
"An examination of a copy of the February 1971 issue of the publication indicates that it is designed primarily for advertising purposes and it does not constitute a periodical within the meaning of the above law."
This language is ambiguous. One reasonable construction is that the publication does not constitute a periodical publication within the meaning of the law because it is designed primarily for advertising purposes. 2/ Alternately it may mean the publication is designed primarily for advertising purposes and for other reasons.
That Decision, however, found countervailing factors in this case sufficient to establish that payment for publication in SBJ was not payment for publication in EBJ. It does not constitute a periodical within the meaning of the law. It was not necessary for the purposes of the Postal Service Decision to resolve the ambiguity. Nor is it for the purpose of this motion. 3/
After further consideration Respondent issued a second letter of denial raising additional objections but not touching on the "periodical" question. Thereafter this proceeding was commenced by the publisher's filing of a petition with the Docket Clerk in which he asserted that EBJ meets the statutory requirements for a second-class mail permit in that it meets each of the specific criteria in the numbered items of Section 4354(a) of former Title 39 U.S.C. as well as the criteria of Section 4354(c).
The answer stated the application had been denied because of the publication's advertising purpose and the failure to meet circulation and subscription requirements 4/ and denied allegations in the petition on those subjects. The answer did not question the publication's status as a periodical. Thus Respondent in framing the issues excluded the "periodical" issue.
Respondent contends, nevertheless, that the Administrative Law Judge considered the "periodical" question to be in issue in the proceeding. In support of that thesis Respondent quotes (Motion, p. 2) two excerpts fro a comment made by the Administrative Law Judge in the midst of a discussion (Transcript, pp. 13 & 14) as to what the issues were. These excerpts do not give a fair rendering of what transpired. A review of the discussion reported in the Transcript with particular emphasis on pages 13-15 demonstrates that Judge Lewis read the language in the May 19 letter in accordance with the first alternative meaning set out on page 4 above. This is shown by his first question on page 15:
"Examiner Lewis: The statement made in the original letter of May 19 is that Executive Beverage Journal is designed primarily for advertising purposes and does not constitute a periodical. Now, what is the basis for that decision? That it's designed primarily for advertising purposes?" 5/Counsel's response here by-passed an obvious occasion to mention the "periodical" issue, if indeed it was present. More importantly, the problem of whether EBJ was a book or a periodical does not appear to have been mentioned subsequently during the hearing and Respondent did not brief the point or ask the Administrative Law Judge to make findings of fact and conclusions of law directed to that issue.
Thus, Respondent after framing the issues in this proceeding in a manner so as to exclude the "periodical" question, failing to present evidence on it and failing to request the Administrative Law Judge to make findings on the question, now contends the question was in the proceeding and the Initial Decision should have decided that question. That contention is plainly absurd.
The Postal Service Decision considered whether this proceeding should be reopened to receive evidence on the "periodical" issue and concluded that was not the proper course to pursue. To be complete Respondent's request to reopen should have included, as shown above, a motion for leave to amend his answer. 6/ Without such an amendment, evidence on the "periodical" question would be beyond the scope of the pleadings.
Although the Postal Service Decision overruled Respondent's contentions for the purposes of this proceeding, it did suggest Respondent might challenge EBJ's right to second-class mail status by instituting a revocation proceeding following the grant of the second-class permit.
Respondent urges that the Postal Service Decision erred in directing that the permit be issued stating he "cannot legally grant EBJ second class authorization, unless his decision has been overruled by the Administrative Law Judge 7/ and that decision is sustained by the Judicial Officer". The conditions stated are precisely those that occurred in this proceeding.
Conclusions of Law 2 and 3 in the Administrative Law Judge's Initial Decision are:
"2. Respondent's denial of a second-class permit for 'Executive Beverage Journal' was erroneous and is hereby reversed.
"3. Subject to an administrative appeal as provided by regulation, a second-class permit should be issued by Respondent to Petitioner for the publication 'Executive Beverage Journal.'"
The Conclusions of Law and Decision set out in the Postal Service Decision are:
"1. The reasons given by the Director of Mail Classification in his letters of May 19, 1971, and July 14, 1971, are insufficient to form a basis for denying the application for a second-class mail permit for EBJ.
"2. The Initial Decision of the Administrative Law Judge is affirmed and the denial of the application for a permit is set aside.
"3. The application for a permit is remanded to the Director for the issuance of a second-class mail permit for EBJ."
As discussed in detail above, the Administrative Law Judge decided all questions Respondent saw fit to present to him and those questions have been considered again on appeal. It is unfortunate that Respondent did not bring the "periodical" issue into the proceeding at a time when it was proper to do so. The consequence of Respondent's failure to do so cannot be that Petitioner must suffer a further delay in receiving his second-class mail permit. Refusal to issue the permit at this stage would be capricious.
Review of the record in the light of Respondent's motion for reconsideration and Petitioner's response thereto does not indicate any substantial error in the Postal Service Decision. Respondent's motion is granted to the extent that it requests reconsideration of the March 8, 1973, Postal Service Decision. Upon reconsideration the Decision is confirmed.
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1/ The Decision of March 8, 1973, stated:
"The Director is correct in this view concerning advertising to the extent that the appropriate assumption is that payment for printing an advertisement in one publication in the absence of countervailing factors should also be deemed to be payment of printing the same advertisement in other publications of the same publisher." (Postal Service Decision, p. 4)
2/ See Counsel's interpretation of the sentence at p. 15, 11. 2-17 in the Transcript.
3/ Even if the second interpretation were adopted, the reader still would not know why the application was denied. The language is broad enough to encompass, for example, in addition to excessive advertising content, failure to be published regularly four times a year, failure to be a publication distinct from Southern Beverage Journal, or, as Respondent now contends, having the characteristics of a book rather than a periodical.
4/ The Answer states:
"The Executive Beverage Journal's application for second class mailing privileges was denied by the Manager, Office of Mail Classification for the following reasons:
"1. The Executive Beverage Journal is designed primarily for advertising purposes (Section 132.226, Postal Service Manual).
"2. The Executive Beverage Journal does not comply with the circulation requirements of Sections 132.225, 132.226 of the Postal Manual in that
"a. It does not have a legitimate list of subscribers (132.225, Postal Manual)
"b. The Executive Beverage Journal is designed primarily for free circulation (132.227, Postal Service Manual)."
5/ It is probable that the second question mark should be a period in view of the tenor of Counsel's reply.