In the Matter of the Complaint Against ROGER LABORATORIES, INC. 15383 N.W. Seventh Avenue at Miami, Florida 33169 and at Post Office Box 6263 Hollywood, Florida 33021 and at Post Office Box 630457 Ojus, Florida 33163 P.S. Docket No. 4/123; 08/05/76 Lussier, Edward F. APPEARANCE FOR COMPLAINANT: Thoma s A. Ziebarth, Esq. Law Department United States Postal Service Washington, D.C. APPEARANCES FOR RESPONDENT: Neil B. Siegel, Esq. Sughrue, Rothwell, Mion, Zinn & Macpeak Washington, D.C.
This matter comes before the undersigned on a Petition filed pursuant to 39 Code of Federal Regulations § 952.30 which provides that when the General Counsel of the Postal Service or his designated representative (hereinafter Complainant) has reason to believe that a person is evading or attempting to evade the provisions of a mail stop order issued under 39 United States Code § 3005 he may request the issuance of a supplemental order. The background of the matter may be briefly summarized.
In November 1975 a Complaint was filed against Roger Laboratories, Inc. (hereinafter Respondent) alleging that certain false representations were contained in specified advertisements for the product "Prostaid" which Respondent markets through the use of the United States mails. A hearing was held on the matter and the Chief Administrative Law Judge of the Postal Service issued an Initial Decision in which he recommended the issuance of the mail stop order under 39 U.S.C. § 3005. Respondent appealed that decision under the applicable Rules of Practice to the undersigned and in mid-April 1976 a final Postal Service Decision upholding the Initial Decision was issued by the undersigned and concurrently a mail stop order with respect to mail related to the sale of "Prostaid" at Respondent's 15383 N.W. Seventh Avenue address in Miami, Florida.
Immediately after the issuance of the Postal Service Decision Respondent filed a Petition for modification of the mail stop order which it supported by an affidavit of Mr. Leo J. Rosen, its president. It was therein represented that all of the objectional advertising directed responses to either Department R. L. or Department O. F. and to avoid screening of Respondent's other mail the order should be modified to apply to mail addressed to those departments only.
It was also represented that a brochure containing the representations found false and accompanying shipment of the product was no longer being utilized. The affiant further stated that "If, however, any advertisements remain in the public domain of which we are not aware, and orders are received for 'PROSTAID' in response to advertisements of the character set forth in Exhibit 2, they will likewise be returned to the Postmaster for appropriate disposition."
The undersigned did not consider the Petition for modification adequate pointing out the need for further clarification as follows:
"It is not clear whether Respondent intends to return all orders for the product 'Prostaid' to the Postmaster or only those it identifies as connected to the advertisements in question and if the latter, how Respondent will make such a judgment. For example, what is the intended disposition with regard to reorders of the product?"
Thereafter Respondent filed a Supplement to its Petition for modification attaching in support thereof another affidavit by Mr. Rosen in which it was represented that orders not having a department number would be returned to the postmaster. In obvious response to the question regarding reorders the affiant stated that the Respondent was attempting to market "Prostaid" with new advertising "in no way violative of the Postal Service regulations and order in this case" and that "Reorders of the product as a consequence of the new advertising" would be directed to a different address than used before. The Supplement to the Petition was even more specific and bears quotation in pertinent part:
"Concerning the question of reorders of the product, again, the Respondent feels that if the product is marketed pursuant to limited advertising and orders are solicited with reorders, those reorders should not be prohibited by the statute. However, the Respondent acknowledges that reorders of the product solicited originally as a result of the offending ads remains an open question. In that regard, such reorders would, again, either be keyed to the department numbers in question since those department numbers are used continuously, or would be solicited to the generalized address. Those reorders would be subject to the Decision and would either be screened automatically by the Postmaster or returned by Roger Laboratories. Reorders of the product which were solicited pursuant to advertising not subject to the order would be keyed to different department numbers or a different address and, hence, would be completely segregated from the original reorders solicited as a result of the offending advertisements."
It was apparent that, except for responses to new and completely different advertising which Respondent intended to use, any orders for "Prostaid" based on old advertising and any reorders would not be filled. The undersigned accordingly modified the mail stop order on May 24, 1976, as Respondent requested "based entirely upon the representations and commitments made by Respondent in its Petition for Modification, as supplemented, and affidavits attached thereto."
Complainant filed, on June 24, 1976, a Petition to reinstate the order in full and to add two additional addresses. 1/ It is apparent that Respondent is filling orders for "Prostaid" in response to an advertisement appearing in the May 1976 issue of Retirement Life Magazine which advertisement is in all respects substantially similar to those which were the subject of the Decision and order. Respondent in its Reply "readily accepts the fact that the advertisement should have been subject to the original order as modified and that orders solicited in response to that ad should be returned as being violative of the Postal Service regulations." It contends the failure to do so was an honest error. It is not contested that P. O. Box 6263, Hollywood, Florida 33021, and P. O. Box 630457, Ojus, Florida 33163 are being used by Respondent in connection with this advertisement.
Also, Respondent admits that it is following the practice of writing down the names and addresses of customers whose mail is being returned under the terms of the modified mail stop order, and writing to them as follows:
"Dear Customer:
We are having a problem with mail delivery by the Postal Service.
Your order for Prostaid with your check has been returned or is being returned to you by the Postal Service.
In order to fill your order for Prostaid, we are enclosing a self-addressed envelope to avoid any further problems.
Simply place your check, for $8.60, in this envelope and mail it back to us, and we shall send your order by return, first-class mail." The address being utilized for this purpose is P. O. Box 6263, Hollywood, Florida 33021.
Respondent asserts in its latest pleading filed July 29, 1976, that a person having his order returned stamped on the envelope "Return to Sender; Order Issued Against Addressee For Violation of False Representation Law" would certainly be wary of any representation made in the original advertising. One would hope so but the false representation statute is not limited to making the prospective purchaser "wary." Its broader purpose is to deny utilization of the mails in furtherance of the false representations.
The burden of showing that particular mail is unconnected with the false representation scheme rests with the Respondent once the Complainant has proven, after the full administrative process, that a mail stop order is warranted. It is completely insufficient to claim that the purchaser's protection lies in the notice placed on the face of the envelope by the postmaster, pursuant to the mail stop order, while Respondent, by separate communication, obfuscates the matter with advice of a "problem with mail delivery by the Postal Service" in an effort to hang on to the customer initially enticed by its false representations.
Respondent's argument is even more unbecoming in the present case where it was given every opportunity to explain its proposed procedures to the undersigned in connection with its Petition for modification of the stop order and made it quite clear in so doing that even reorders connected with the original advertising would not be filled but only orders related to totally new advertising. Its latest pleading, filed July 29, 1976, while acknowledging that orders received in response to its previously undisclosed Retirement Life advertisement should not be filled, still makes the technical point that since this advertisement was not included in the mail stop order it could be filled under Respondent's guidelines. If so, it does violence to the plain meaning of Respondent's sworn commitments, continues the false representations and only serves to highlight the unreliability and ineffectiveness of voluntary compliance by Respondent.
Respondent also contends that its letter makes no representations regarding the product and that the activity is in full compliance with the modified mail stop order. On the contrary the practice speaks for itself. It is directly contrary to the representations upon which the modified order was based which left no room for doubt that reorders might well be tainted with the original false representations and conveyed the belief that only reorders clearly associated with new advertising would be filled. Furthermore it is obvious that sending such a letter in response to individuals who have placed orders based on the false advertising accompanied by the totally inadequate explanation that "We are having a problem with mail delivery by the Postal Service" is productive, not of compliance with, but rather evasion of, the purposes to be served by the order.
The facts are not in dispute although Respondent would have the undersigned postpone action until Mr. Rosen, and "others" are given the opportunity to testify as to his good intentions and the procedure, unspecified in Respondent's answer, which Respondent has taken to comply with the postal regulations, contending that such testimony is important since it will demonstrate that no attempt to evade the modified order has taken place. The question of Respondent's subjective intention is mooted by the bare fact that its actions have the effect of actual evasion of the order. Further delay to inquire into the facet of whether these were the result of bad faith or something less will only frustrate the protection the public is entitled to in either event under the uncontested facts and is therefore not warranted. If Respondent is truly concerned about establishing a record of its good intentions or efficiency in complying with the law, it can best do so by its future actions.
The Complainant's Petition is granted. Order No. 76-34, reinstated in full by my order of June 25, 1976, is hereby further amended to include the additional addresses shown in the caption of this Decision.