In the Matter of the Complaint Against MULTI-MARKETING and/or MARKETING 4676 Mirasol at Calabasas, California 91302 P.S. Docket No. 3/23; APPEARANCES: Lee H. Harter, Esq. Consumer Protection Office Law Department United States Postal Service Washington, D.C. 20260 for Complainant Gary B. Levell, Esq. 9107 Wilshire Boulevard, Suite 506 Beverly Hills, California 90210 for Respondent
This matter is before the undersigned on petition for an order pursuant to 39 U.S.C. § 3005 based upon an alleged breach of a Consent Agreement. An earlier complaint brought against Respondent using the name Margot G. Maner, at the same address, was indefinitely suspended upon execution of the Consent Agreement on April 11, 1974. An order issued on February 4, 1975, by the undersigned defined the scope of the issue to be tried and is incorporated herein by reference and made a part of this decision. That order while denying Respondent's motion for an evidentiary hearing in Los Angeles in the absence of a showing that evidence was available on the issue to be tried offered Respondent the opportunity to make such a showing. This Respondent has not done but in its brief filed on the issue of breach it renews its request for an evidentiary hearing if its argument on the merits is "deemed insufficient by the Judicial Officer". This request is patently without merit and the case is considered now ready for decision.
Respondent's brief is separated into two parts, the first being a petition to dissolve a mail detention order issued on December 19, 1974, after the petition alleging breach of the Consent Agreement was filed with the undersigned and the second part being the argument that there has been no breach of the Consent Agreement.
With respect to the petition for dissolution of the mail detention order, Respondent contends that:
"1. By execution of the Consent Order herein, respondent did not consent in advance to a unilateral determination by the Postal Service that his revised advertising claims were either false and misleading or bore a substantial resemblance to previous claims which were the subject of the consent Order, without any opportunity to be heard before economic damage was inflicted upon him; * * *"
The language of the Consent Agreement is explicit that the Judicial Officer is authorized to issue the mail detention order "ex parte" upon the filing of a petition alleging breach of the agreement "pending final resolution of the issue concerning the alleged breach of this agreement". If the petition was obviously deficient on its face it would be within the power of the Judicial Officer not to issue the detention order but that is not the situation presented in the instant case. The agreement clearly contemplates a "resolution of the issue concerning the alleged breach" after, and not prior to, the issuance of the mail detention order. The validity of such agreements was discussed, with supporting legal precedents, in my order of February 4, 1975, above referenced.
Respondent's second contention to support its petition for dissolution of the mail detention order is that:
"2. There would be no detriment suffered by petitioner or the public interest if the mail detention order is dissolved pending final decision on this matter; whereas, if said order is sustained, respondent cannot reasonably anticipate economic survival and hence any later decision rendered on the merits would become moot."
This decision is the final agency decision on the merits. It is being rendered within two weeks of the time Respondent's brief was filed. Any dissolution of the mail detention order has no rhyme or reason in this case except as a consequence of a final agency decision finding that there was no breach of Consent Agreement. To do otherwise, in the absence of a compelling showing, as distinguished from allegation, of irreparable damage and a defense which appears likely to succeed, would be to negate the parties' agreement. If Respondent's reference to a "later decision" is intended to refer to a court decision arising out of these proceedings, it is sufficient to note that it is not the practice to permit Respondent's uninhibited use of the mails after a violation of 39 U.S.C. § 3005 has been found, or a violation of a consent agreement arising out of enforcement of that statute has been found. While the order issued pursuant to that statute may be suspended insofar as it requires return of the mail to senders the mail is nevertheless detained during pendency of the court proceedings.
Respondent's argument that there has been no breach of the Consent Agreement as contained in its brief and its earlier motions will now be discussed. At the outset it should be pointed out that there is no disagreement that the parties and the product here involved are identical to those in the prior proceeding which led to the Consent Agreement. Respondent also admits that it entered into that agreement knowingly and with advice of counsel (Respondent's Brief, p. 4). It contends, however, that changes in its advertising materials have been such as to remove it from the prohibited activity.
The Consent Agreement provided in pertinent part:
"1. The use of the aforementioned promotional activities and representations for obtaining money or property through the mails has been and will be permanently discontinued and abandoned, and will not hereafter be resumed, directly or indirectly, under any name(s), and address(es), or through any corporate or other device."
The "aforementioned promotional activities and representations" are identified in the first paragraph of the Consent Agreement as those described in the original "Complaint filed 3/20/74". Those promotional activities and representations which it is alleged Respondent is continuing in its revised advertising are: that Respondent's product (defined as 1 nucleic complex pill plus 3 Vitamin B-complex pills daily in the doses contained therein) will--
(1) eliminate lines and wrinkles;
(2) improve blood circulation;
(3) increase muscular and physical mobility;
(4) eliminate skin blemishes and acne;
(5) improve liver and heart conditions; and that the Nucleic Complex tablets are an integral part of Respondent's program and are the major cause of the beneficial results described.
Respondent's Brief at page 5 points out that "Neither respondent nor his counsel has ever contested the fact that the prohibited claims clearly and expressly appear in this earlier material" referring to its earlier advertising material but strongly urges that a careful review of the current advertising 1/ "will clearly indicate that none of the prohibited claims appears therein".
I am unable to agree with Respondent's contention. Careful review of the current advertising reveals that the nature of the changes made by Respondent has been to remove the majority of the explicit representations contained in the earlier advertising while retaining the representations implicitly. The difference between the two is essentially the difference between what might be considered hard sell versus soft sell advertising. For example, Respondent's current advertising (Exhibit G-1) makes the following general statement:
"Among other reasons, this slowing-down process is probably due to the cell system constructing non-functional tissue over a long period of time. Non-functional tissue on the outside of the body, in the skin, can be observed in aging spots, rough elbows and callouses. Internally, the observing of accumulations in organs and muscle tissue is more difficult. The goal of our food supplement is to improve the external and internal environment of skin, organs, and muscles, and in so doing, to alleviate evidence of wrinkles, aging spots, rough elbows, and callouses. Such skin changes can become noticeable in 90 days or less, the period of time in which the cell tissue normally would have reproduced."
The schematic diagram which is Exhibit G-2 shows numerous effects of aging which fall within the list of conditions the original complaint alleged Respondent was representing would be eliminated or improved by the use of its product. This is not a "wholly innocuous pictorial chart" as Respondent terms it. It must be viewed in the context of the other exhibits. When so read it is clear to me that the impact upon the ordinary reader would be that the use of the product would forestall the effects of aging portrayed pictorially and in the narrative portions of the advertising. For a three-month supply of the RNA/DNA Nucleic Complex tablets at a price of $28.00 the order form (Exhibit F-2 proclaims in bold print "Announcing An Exciting New Way]]" To what--the reader might justifiably ask? The answer is reasonably to be inferred from the remainder of Respondent's advertising. Although the more glaring claims in the original advertising have been removed, the current advertising contains the subtle, not identical, but substantially similar, promise of what was formerly held out in the representations which Respondent agreed to discontinue.
Respondent's arguments with respect to the truth or falsity of the advertising, the lack of toxicity or danger to human health or safety, and the lesser need for stringent control over "foods" or "food supplements" than over "drugs" are inappropriate for resolution in this proceeding as explained in my order of February 4, 1975, above referenced.
On the sole issue before me, the alleged breach of the Consent Agreement, I find that the current advertising violates that agreement. Thus, in accordance with the terms of the Consent Agreement, I am issuing an order under 39 U.S.C. § 3005 contemporaneously with this decision.
03/27/75
Lussier, Edward F.
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