In the Matter of the Complaint Against LAWRENCE EARL FREEMAN LARRY FREEMAN P. O. Box 1545 at Peoria, IL 61655 P.S. Docket No. 14/27; 10/18/82 Grant, Quentin E. APPEARANCES FOR COMPLAINANT: Thom as A. Ziebarth, Esq. Consumer Protection Division Law Department United States Postal Service Washington, DC 20260 Steven B. Caver, Esq. Regional Inspector Attorney Rm. 715, Main Post Office Bldg. Chicago, IL 60607 APPEARANCE FOR RESPONDENT: Lawrence Earl Freeman P. O. Box 1545 Peoria, IL 61655
In a Complaint filed August 4, 1982, the Postal Service says that Respondent is violating 39 U.S.C. § 3005 in connection with a multitude of orders he has sent to approximately 200 companies for a wide variety of merchandise for which Respondent has not paid. The Postal Service says that Respondent has received such merchandise by falsely representing that he has the means to pay, and will pay, for such merchandise.
Respondent filed an Answer to the Complaint in which he did not deny having ordered merchandise for which he has not paid but expressed intentions to make payment as soon as he gets a job and to return some of the merchandise in question.
A hearing was held in Washington, D.C. on September 15, 1982. Respondent did not appear at the hearing. Although the matter might have been treated as appropriate for default disposition at that time, I felt the "first-impression" nature of the case called for receipt of evidence and legal argument to determine whether 39 U.S.C. § 3005 may be used in these circumstances.
1. Lawrence Earl Freeman, also using the name Larry Freeman, using the address P. O. Box 1545 at Peoria, Illinois 61655, during a period of three or four months in late 1981, perhaps extending into early 1982, went on a mail order buying binge. He ordered merchandise having a total value in excess of $10,000 from approximately 200 publishing and mail order firms (Tr. 15-17); CX-7).
2. In early 1982 Mr. Freeman struck a sour note with Schulmerick Carillon, Inc. In April 1982 this company wrote to the Peoria postmaster complaining about Freeman. Schulmerick was not the victim of Freeman's failure to do the right thing about merchandise ordered and received, its wise policy being to require not less than a 20 percent deposit before making shipment. Rather, Schulmerick was jangled by the expense attendant on Freeman's unceasing use of Schulmerick's postage paid cards and envelopes to inquire about its handbells and to order such bells without enclosing the necessary payment or deposit. The record does not disclose what, if anything, the postmaster did to still the bad vibrations Freeman was giving the bell company. But Schulmerick's complaint appears to have caused the postal authorities to keep an eye on Freeman when he would come to the post office to pick up his mail.
3. Beginning in early June 1982 and continuing into July their surveillance revealed that Freeman was receiving large quantities of mail order merchandise and magazines which he sometimes abandoned in the post office lobby and that he was receiving hundreds of pieces of first-class mail, most of which he promptly deposited in waste baskets in the lobby. Curiosity, quite natural under the circumstances, caused the postal authorities to retrieve Freeman's discarded mail from the waste baskets and to determine the relationship, if any, between senders of such mail and the numerous items of merchandise abandoned by Freeman. The investigation disclosed a significant amount of matching of first-class mail with abandoned merchandise and that most of the mail consisted of bills, invoices and letters designed to concentrate Mr. Freeman's attention on the matter of his overlooking repeated reminders of past due payments for previously shipped merchandise (Tr. 6-15).
4. As a result of their investigations the postal authorities compiled a list of approximately 200 companies to whom Mr. Freeman owed a total of more than $10,000 for merchandise ordered and received by him (CX-7).
5. On being sighted in the Peoria Post Office on July 9, 1982, Mr. Freeman was invited to the office of Postal Inspector Dodd to be interviewed. He signed a Warning and Waiver of Rights form (PS Form 1067). He then identified approximately 300 letters (bills, invoices, dunning letters) which he had placed in post office waste baskets the previous day and acknowledged overdue indebtedness to numerous mail order and publishing companies. He stated that when he got a job he would pay these bills. He further stated that he had already stopped placing new orders but that some companies continued to send merchandise and magazines to him in spite of the delinquent condition of his accounts. His attitude, however, as disclosed in Inspector Doo's report of the interview, was not one of serious concern about the matter (CX-5; Tr. 9-12).
6. According to the testimony of Postal Inspector Dodd, based on his investigation, and the Answer filed by Mr. Freeman there is no indication that Freeman has made any payments on the merchandise in question, that he had the means to pay for it when he ordered it, or that he has prospects of acquiring such means (Tr. 11, 12).
7. Respondent's orders for merchandise necessarily implied representations of intent and means to pay therefore.
Generally, 39 U.S.C. § 3005 is regarded, and employed by the Postal Service, as a consumer protection statute. But, as correctly argued by Postal Service Counsel nothing in the wording of the statute limits its scope to consumer protection.
Here the statute is invoked to protect mail order businesses and publishers from losses caused by an individual who engaged in a wide-ranging campaign to secure publications and merchandise through the mails by means of orders amounting to explicit promises to pay therefor accompanied by necessarily implicit representations of intention and ability to pay.
Did Respondent's orders for such merchandise constitute "a scheme or device" within the meaning of the statute? There is no indication that these words are used as terms of art limited to the use of advertising or other promotional activities in the sale of products to the public. The pertinent dictionary definition of "scheme" is a "plan or program of action; esp: a crafty or secret one." "Device" is defined as "a scheme to deceive" (Webster's New Collegiate Dictionary).
Respondent's multiple orders for merchandise with their implicit, but false, representations of ability and intent to pay fit the definitions of both words.
The materiality of Respondent's implicit representations is obvious. It is fair to presume that the mail order firms relied on such representations in honoring Respondent's orders. Certainly, it is unlikely that they would have shipped their products had they known he had neither the intention nor the ability to pay.
Respondent is engaged in a scheme or device to obtain property through the mails by means of materially false representations. Therefore, an order pursuant to 39 U.S.C. § 3005, in the form attached, should be issued against Respondent.