In the Matter of the Complaint Against COSVETIC LABORATORIES P.O. Box 10101 Atlanta, GA 30319 P.O. Box 14048 Atlanta, GA 30324 P.O. Box 95503 Atlanta, GA 30347 P.O. Box 10225 Atlanta, GA 30319 and HEAD START P.O. Box 10064 Atlanta, GA 30319 ORDER OF CORREC POSTAL SERVIC The Postal Service Decision in the James Judici Attachment In the Matter of the Complaint Against COSVETIC LABORATORIES P.O. Box 10101 Atlanta, GA 30319 P.O. Box 14048 Atlanta, GA 30324 P.O. Box 95503 Atlanta, GA 30347 P.O. Box 10225 Atlanta, GA 30319 and HEAD START P.O. Box 10064 Atlanta, GA 30319 P.S. Docket No. 7/38; 02/04/80 Cohen, James A. APPEARANCE FOR COMPLAINANT: DanielS. Greenberg, Esq. Consumer Protection Office Law Department U. S. Postal Service Washington, DC 20260 APPEARANCE FOR RESPONDENT: Jack Paller, Esq. Katz, Paller & Land 470 East Paces Ferry Road, N.E. Atlanta, GA 30305
Respondent has appealed from the Initial Decision of Administrative Law Judge Quentin E. Grant in which Judge Grant recommends the issuance of an order under 39 U.S.C. § 3005 based on a conclusion that Respondent, by means of advertising for its product, which is variously identified as "The Nail Vitamin," "The Nail System (Vitamins)" and "Vitamins For Your Nails," is engaged in a scheme for obtaining money through the mail by means of false representations.
On March 16, 1979, the Consumer Protection Office, Law Department United States Postal Service, filed a complaint alleging that Respondent is engaged in conducting a scheme for obtaining money through the mail in violation of 39 U.S.C § 3005. The complaint alleges that Respondent's advertising represents:
1. That ingestion of Respondent's vitamins will cause most women to grow beautiful nails;
2. That the vitamins provide a substantial benefit over and above the user's normal daily diet, i.e., the result indicated in 1;
3. That ingestion of Respondent's vitamins will improve the structure and strength of most women's nails;
4. That ingestion of Respondent's vitamins will eliminate or significantly reduce white spots in the nails for most women who have such spots.
The complaint further alleges that these representations are materially false.
Following a hearing and the submission of proposed findings of fact and conclusions of law by both parties, Administrative Law Judge Grant issued his decision holding that Complainant had established that the Respondent makes the representations alleged in the complaint and that those representations are materially false and in violation of 39 U.S.C. § 3005. Respondent filed a timely appeal from that decision.
In its appeal Respondent does not challenge Judge Grant's finding that its advertisements make the representations alleged in the complaint. The appeal is based principally upon the qualifications of the expert witnesses and the weight which should be given to their testimony in determining if the representations made are materially false. Accordingly, prior to addressing Respondent's specific exceptions to the Initial Decision, it is appropriate to address and resolve questions concerning the qualifications of, and weight given to, the testimony of the experts.
Complainant's first witness was Dr. Sarah Hunt. Dr. Hunt holds B.S., M.S., and Ph.D. degrees in Nutrition (Exhibit 11, Tr. 10). Dr. Hunt described nutrition as involving the study of nutrients and their function in the body (Tr. 11). Dr. Hunt has taught nutrition to medical students and performed nutrition research, primarily related to obesity (Tr. 11, 13). Dr. Hunt has never been consulted or involved in the treatment of broken or split fingernails (Tr. 35). Dr. Hunt has no particular interest in nail growth and does not consider it to be an important aspect of nutrition (Tr. 42). Dr. Hunt's testimony clearly indicates that she possesses knowledge concerning the effect of nutrients on nail growth. However, the record is devoid of any specific information about the extent, if any, to which this subject is addressed in courses of study leading to degrees in nutrition or any other relevant special education or training that Dr. Hunt may possess.
Dr. Hunt testified at length with regard to the nutrient value of the various ingredients of Respondent's product and how such ingredients would affect nail growth (Tr. 13-32). Dr. Hunt indicated that one or two of the ingredients in Respondent's product would have some beneficial effect on nail growth if there was a deficiency of the particular ingredient. However, Dr. Hunt does not consider that in the United States there is any dietary deficiency, of any significance, of any of the ingredients in Respondent's product (Tr. 45). Accordingly, Dr. Hunt concluded that Respondent's product would have no useful value in accomplishing the represented results (Tr. 32). Dr. Hunt testified her opinions are in conformity with the consensus of professional nutritionists (Tr. 32).
Complainant's second witness was Dr. Henry Jordan Whyte, a medical doctor specializing in dermatology (Tr. 177). Dermatology is the medical specialty concerned with the diagnosis and treatment of diseases of the skin (Dorland's Illustrated Medical Dictionary, 25th Edition (1974)). The nails are considered a portion of the skin and fall within the study of dermatology (Tr. 120, 177, 179; Sneddon and Church, Practical Dermatology, (1966)). Dr. Whyte has taught dermatology at the Dartmouth, Pittsburgh and Emory University medical schools. At the time of his testimony he maintained a private practice and continued to teach. As a part of his practice, he regularly treats one to two patients a week who come to him specifically for problems with their nails (Tr. 177, 190).
Dr. Whyte testified that the vast majority of nail injuries result from physical causes (Tr. 177, 178). He stated that nutritional deficiencies are not a common cause of nail problems and that such problems would not be effectively treated by the ingestion of Respondent's product (Tr. 178, 179). He believes that the most satisfactory method of treatment for nail deficiencies of the type Respondent represents its product will eliminate is to soak the nails in a rehydrating solution and then paint them with a light solution of bath oil (Tr. 180). He testified that Respondent's product would provide no benefit to nail appearance or structure and that his views are in accordance with the consensus of dermatological opinion (Tr. 179, 189, 195, 196).
Respondent called Dr. James Thomas Cooper, a medical doctor specializing in bariatrics, which pertains to nutrition and other fields having to do with obesity or weight control (Tr. 114). Dr. Cooper teaches a course in nutrition to medical students (Tr. 113). As a part of his private practice many patients come to Dr. Cooper for the treatment of problems other than nails. Such treatment of the nails as Doctor Cooper has given is incidental to the treatment of these other problems (Tr. 115, 139, 168). Dr. Cooper does not have any patients who have come to him solely for the treatment of nail problems. The record includes no information as to how much training a medical doctor routinely receives in the field of dermatology and, in particular, with regard to nails. Neither does the record include the amount of special or additional training Dr. Cooper may have obtained in connection with the causes and treatment of nail conditions.
The testimony of Dr. Cooper conflicts with the testimony of Drs. Hunt and Whyte with regard to the benefits which would be realized through the ingestion of Respondent's product. Dr. Cooper believes that some dietary inadequacies exist and that Respondent's product could be beneficial in achieving the results represented in Respondent's advertising (Tr. 126-128). However, Dr. Cooper conceded that there is no indication that a significant percentage of the population is not getting the recommended daily allowance of the ingredients included in Respondent's product (Tr. 152-157; 163-167). He also testified that, although protein is available to everyone, there are some people who do not get adequate protein, but Respondent's product provides only an insignificant amount of protein (Tr. 146, 147, 150, 151).
Dr. Cooper also testified that without specific information about a patient he would not prescribe Respondent's product (Tr. 140). In providing nail treatment he does not use Respondent's product. He uses a formula consisting of different quantities of the ingredients in Respondent's product and other ingredients (Tr. 124, 157, 169). His clinical experience, upon which his views are primarily based, involves the treatment for problems other than nails and the prescription of many ingredients in addition to those included in Respondent's product (Tr. 168). In his opinion, it would be impossible to isolate the effect of a particular ingredient (Tr. 168). Dr. Cooper made reference to a "perfect control group" but provided no specific or pertinent information as to the composition, nature, purpose or data derived from such a group (Tr. 169-171). Dr. Cooper believes his views are in accordance with the consensus of "enlightened" medical opinion (Tr. 132). On the basis of Dr. Whyte's testimony, it appears that "enlightened" medical opinion is something other than the consensus of dermatological opinion (Tr. 178, 179, 181).
Drs. Hunt and Cooper both appear to possess substantial knowledge with regard to nutrition and its effect on human nails. However, there is no specific evidence as to the extent of the training or experience either has had in connection with the treatment and/or effect of nutrients on the nails. Dr. Hunt expressed a general lack of interest in the nails and Dr. Cooper's treatment of nails is incidental to other treatments. In contrast, Dr. Whyte is a specialist in dermatology, the area of medicine which specifically includes the nails. Of the three witnesses, he is the only one who has had patients come to him specifically for nail problems and has provided such treatment on a regular basis. The testimony of Dr. Hunt supplements and confirms the views and opinions expressed by Dr. Whyte in that nutritional deficiencies are not a significant cause of nail problems. Accordingly, the weight to be given to Dr. Whyte's testimony as supported by the testimony of Dr. Hunt substantially exceeds the weight to be given to the testimony of Dr. Cooper.
It is concluded that the vast majority of nail damage is the result of physical causes and that the ingestion of Respondent's product will not have any significant effect on the elimination or correction of such damage or otherwise cause the nails to be stronger, longer or more beautiful.
In its appeal brief Respondent sets forth thirty (30) allegations of error. Each is addressed below.
Respondent claims that in Finding of Fact No. 1, which holds that Respondent is engaged in a scheme to obtain money through the mail, Judge Grant erred because there is inadequate evidence upon which to establish a prima facie case of material misrepresentation of fact. Respondent apparently misreads this finding since it does not address the question of misrepresentation. It is fully supported by the exhibits and paragraph IV of Respondent's answer to the complaint.
Respondent takes exception to Finding of Fact No. 2, contending that it holds that Dr. Hunt is well-qualified to testify as to the truth or falsity of the representations made by Respondent concerning its product. Finding of Fact No. 2 does not address this matter. Apparently, Respondent intended this exception to address Finding of Fact No. 3 which does hold that Dr. Hunt is well-qualified to testify as to the truth or falsity of Respondent's representations. On the basis of the analysis of the expert testimony set forth above, it is appropriate to consider the testimony of Dr. Hunt in a supportive role to the testimony of Dr. Whyte. When so considered the ultimate conclusions reached in the Initial Decision are supported by the evidence in the record and are correct.
Respondent's Exceptions 3, 4, 5, 6, 7, 8, 9, 11, 12, 19, 20, 21, 22, 23, 24, and 25 all address testimony and conclusions pertaining to various nutrients and their ability or inability to enhance nail growth and appearance. In view of the conclusions set forth above, that the vast majority of nail problems are the result of physical causes and that the ingestion of nutrients such as those in Respondent's product will not correct such nail deficiencies, the issues raised by these exceptions have no bearing on the factual and legal conclusions reached. Moreover, a review of the evidence does not reveal any errors in the evaluation of the testimony relating to the various nutrients contained in Respondent's product.
In Exceptions 8 and 9 Respondent provides quotations which it states are from the "Food and Nutrition Board Recommended Daily Allowance." The publication to which reference is made is not in the record and no further detail concerning the publication has been provided by Respondent. Complainant has taken exception to consideration of this publication which it considers to be new material. Respondent contends that it should be considered and cites several instances where dictionaries, textbooks and, in one case, a mathematical formula not in the record have been relied upon in reaching decisions. Some references to sources outside the record for facts of general notoriety and those evidenced by public records and standard texts fall well within the evidentiary principles of "Judicial Notice." See 31 C.J.S. ??7, 12; 31A C.J.S. ?? 67, 74 and the decisions cited therein. Although it would have been preferable to have had the publication introduced into evidence, it appears to be a standard text which can be considered in this proceeding. However, the conclusion reached in the preceding paragraphs makes the matter moot.
In Exception 13 Respondent challenges Finding of Fact No. 26 with regard to the reliability of the data obtained from sources other than double blind studies. The Finding of Fact accurately sets forth the views expressed by Dr. Whyte. Data from a double blind study would probably be more persuasive than the opinions expressed by various witnesses at the hearing in this matter. However, such data is not available and this decision is based on the evidence presented and the persuasiveness of that evidence.
Respondent's Exception No. 14 challenges Conclusion of Law No. 3 which holds that Respondent's representations pertain to vitamin tablets alone and do not indicate a need for the concurrent use of a protein protective coating also sold by Respondent. Respondent claims that the exhibits in the record establish that Respondent's product is a "system" which includes both a vitamin supplement and a protein coating. Respondent's position is not well-taken. The photograph and narrative in Exhibit 2 deal solely with the vitamins. The photographs in Exhibit B to the complaint and Exhibits 3, 4 and 5 include both items, but the accompanying narrative makes reference only to the vitamins. Exhibit A to the complaint and Exhibit 1 picture both items and the accompanying narrative mentions both. However, neither includes any suggestion that in order to obtain desired results it is necessary to use both the protein coating and the vitamins. Exhibit 6, Respondent's order form, provides for ordering the vitamins separately and includes no suggestion that to be effective they should be used in conjunction with the protein coating.
Respondent's Exception 16 challenges the accuracy of Conclusion of Law No. 5. In Conclusion of Law No. 5, it is stated that no weight was given to the testimony of Respondent's employees in connection with a "test" of Respondent's product because of (1) possible bias, (2) the test period was insufficient to observe results and (3) the subjects used Respondent's protein coating in addition to the vitamin supplement. Respondent asserts that bias and the 60-day period are not a proper basis to disregard the testimony of Respondent's employees. The record supports the conclusion reached in the Initial Decision. The probability of bias is found in the testimony of Dr. Whyte and is reasonable (Tr. 185). The insufficiency of a 60-day period is supported by the testimony of both Dr. Cooper and Dr. Whyte (Tr. 118, 119, 185). Also, in view of the total absence of supervision, control, and scientific approach, Judge Grant correctly concluded that the testimony of Respondent's employees had no persuasive value.
Respondent, in Exception No. 27, challenges that portion of Conclusion of Law No. 10 which, in essence, declines to place any evidentiary value on information presumably derived from Dr. Cooper's "perfect control group." Respondent alleges that the evidence shows that "a reliable control was used and based thereon, the comparison was viable." There is no persuasive evidence to support this allegation.
Respondent's Exceptions 10, 15, 17, 18, 26, 28, 29 and 30 go to the basic question presented in this case, i.e., has Respondent materially misrepresented its product and is it in violation of 39 U.S.C. § 3005. On the basis of the conclusions set forth above, Respondent's position in this regard is not in accord with the evidence and, therefore, is without merit.
After consideration of the entire record and the exceptions taken to the Initial Decision, it is concluded that Respondent is engaged in a scheme for obtaining money through the mail by means of materially false representations. Accordingly, Respondent's appeal is denied and a remedial order under 39 U.S.C. § 3005 is being issued contemporaneously with this decision. However, pursuant to the request set forth in Respondent's brief, the return portion of the order is being stayed for a period of 21 days in which Respondent may seek judicial review or enter into a consent agreement with Complainant.
The Postal Service Decision in the captioned proceeding contains an omission on Page 5, line 21, and an omitted line on Page 8 at the end of the first full paragraph. Attached is a reprinted copy of the Decision reflecting corrections on Pages 5 and 8.