In the Matter of the Complaint Against HELON COMPANY, INC. P. O. Box 172 at Pennsauken, NJ 08110 P.S. Docket No. 9/60; 11/20/80 Duvall, William A. APPEARANCE FOR COMPLAINANT: Kris tin L. Malmberg, Esq. Law Department United States Postal Service Washington, D.C. 20260 APPEARANCE FOR RESPONDENT: Michael C. Meisler, Esq. Garfield, Meisler and Blatt 5950 West Oakland Park Blvd. Lauderhill, FL 33313
This proceeding was initiated on September 4, 1980, when the General Counsel for the United States Postal Service filed a Complaint in which it is alleged that Helon Company, Inc., at Pennsauken, New Jersey, is engaged in conducting a scheme or device for obtaining money or property through the mails by means of false representation in violation of 39 U. S. Code 3005.
Attention is attracted to the scheme, according to the Complaint, by means of telephone solicitations for the purchase of goods and by means of billing invoices and verification letters, all of which are calculated to induce the remittance of money through the mails. Attached to the Complaint is a copy of an invoice and a verification letter which are represented as being typical of those previously referred to.
It is charged that by means of such invoices and verification letters the Respondent makes the following material and false representations:
(a) The recipient has purchased janitorial supplies from HELON COMPANY, INC.
(b) The recipient has ordered for purchase janitorial supplies from HELON COMPANY, INC.
In the Answer to the Complaint, Respondent indicated that Respondent would not appear at the hearing. It was requested that the proceeding be conducted as provided in § 952.11(b) of the Rules of Practice, which provides:
"(b) If the Respondent files an answer but fails to appear at the hearing, the Respondent may, unless timely indications to the contrary are received, be deemed to have abandoned the intention to present a defense to the charges of the complaint, and the Judicial Officer, without further notice to Respondent, may issue the order sought in the complaint."
That request was granted.
Testifying as Complainant's witness in this matter was Postal Inspector Floyd A. Gillespie, who is domiciled in Philadelphia,
Pennsylvania. When this matter arose he was charged with the responsibility and duty of investigating false invoices and false representation cases. (Tr. 13)
The business is owned by David Vogel who employs as his general manager in the operation of Helon Company, Inc., a man by the name of Arthur Celona. In sales meetings and by other means, David Vogel gives information to different salesmen as to the names, addresses and telephone numbers of various persons or firms who are to be contacted by the salesmen by telephone and by means of the forms of invoice and verification letter which are attached to the Complaint as Complainant's Exhibit 1, page 1, and Exhibit 1, page 2. (Appendices A and B hereto)
The instructions to the salesmen are to attempt to call the names of the individuals that have been given to them, or the names of the firms that have been given to them, at the telephone numbers which have been furnished. If a salesman talks to a specific person, or even if he does not talk to anyone, invoices and verification letters similar to those appearing in Appendices A and B are sent to each address.
Inspector Gillespie interviewed David Vogel and he also interviewed Arthur Celona. Celona said that Vogel told him that they might achieve as high as a 10 percent return with respect to these invoices that are sent out as described above. Therefore, the object and purpose of this business is to send out as great a number of invoices as possible to all of those prospects whose names were furnished to the salesmen.
Mr. Celona, as general manager for the Respondent kept a record of cancellations, meaning those instances in which efforts to obtain a remittance from the addressee were not successful. The rate of cancellations which came back with notations such as "Did not order," "Do not send" or "No such person" ran at about 80 percent for the period of time during which Mr. Celona kept the records. (Tr. 13-14)
Also appearing as a witness for the Complainant was Postal Inspector Robert Paul Romaniecki, who is also domiciled in Philadelphia. Inspector Romaniecki was assigned to investigate this matter, and he has been so engaged since February of 1980. To the date of the hearing he had received a total of 16 complaints against this Respondent. (Tr. 4-5)
In the course of his investigation, the Inspector interviewed four people among whom was James A. Coombe, a partner in the ABE Car Care Center, Allentown, PA, an automobile repair company (hereinafter, the company). Mr. Coombe said that in April of 1980 the company received through the mail the original of the invoice which is Appendix A to this decision. The invoice is for one case of 40TCL/hd, at a cost of $376.50. He made this statement in a affidavit which he executed on October 15, 1980. (Comp. Ex. 2)
Continuing in that affidavit, Mr. Coombe said that the ABE Car Care Center had no prior business dealings with Helon Co., Inc., and that the invoice he received was for merchandise he never ordered. Mr. Coombe reported the facts of this matter and a similar one to the Postal Service in Washington, D.C. (id.)
Inspector Romaniecki related the details of three other similar situations that he investigated and which are described in affidavits received in evidence as Complainant's Exhibits 1, 3 and 4. (Tr. 6-8, 9-12)
I make the following findings of fact:
1. The Respondent, Helon Company, Inc., does engage in business and obtains and attempts to obtain remittances of money through the mails.
2. In connection with the business operated by this Respondent, materials similar to those which are attached hereto as Appendices A and B are used.
3. In considering whether a representation is or is not made, a judgment is to be made on the basis of the impression that the solicitation literature would make upon the average reader. That criterion was established in the case of Donaldson v. Read Magazine, 333 U.S. 178. Following that criterion, I find that the Respondent does make the representations set forth in the Complaint.
4. Based upon the evidence which has been adduced at this hearing I find that the representations made by the Respondent in its mailed literature are both material and false, since it causes some persons to remit sums of money through the mails to Respondent.
In consideration of the above findings of fact, I conclude as a matter of law that the Respondent is, as charged, engaged in conducting a scheme or device for obtaining money or property through the mails by means of false representation within the meaning of Section 3005 of Title 39, United States Code.
Accordingly, a mail stop order, as provided in that section of the Code and substantially in the form attached, should be issued against this Respondent.