In the Matter of the Complaint Against THE NEW BODY BOUTIQUE, INC. also doing business as THE NEW BODY BOUTIQUE and as SHRINK-WRAP at 2105 Lakeland Avenue Ronkonkoma, NY ll779, et al. P.S. Docket No. 11/95; 01/12/83 Cohen, James A. APPEARANCE FOR COMPLAINANT Hilda Rosenberg, Esq. Consumer Protection Division Law Department United States Postal Service Washington, DC 20260-ll00 APPEARANCE FOR RESPONDENT Lee H. Harter, Esq. 2256 Van Ness Avenue San Francisco, CA 94109
On November 30, 1982, a Postal Service Decision on Complainant's Petition for Supplemental Order was issued which concluded that Respondent continues to make the representations alleged in paragraphs a, c, d and g of the Complaint and that a supplemental False Representation ORder would be issued unless Respondent showed cause why a hearing should be convened to take evidence on relevant disputed factual matters. Respondent has filed a Motion for Reconsideration of that decision and what it considered to be cause for holding a hearing. In addition to arguing that the decision should be reconsidered and a hearing should be held, Respondent argues that it has acted in good faith and that it was denied due process. Each of Respondent's contentions is discussed hereafter.
Respondent contends that the identity of its product has been changed by the addition of instructions advising the user to tighten the Shrink-Wrap garment whenever they feel the urge to eat. According to Respondent a hearing should be held to take evidence on whether this new and different usage of the garment would cause the user to realize the results represented in its advertising. Complainant argues that the one factual issue Respondent points to as undetermined, the identity of the product, has already been decided and that there are no other factual issues which require a hearing.
The issue of the identity of the product was decided in both the Postal Service Decision on Respondent's appeal from the Initial Decision, New Body Boutique, Inc., P.S. docket No. 11/95 (P.S.D. July 30, 1983) and the Postal Service Decision on Complainant's Petition for Supplemental ORder, New Body Boutique, Inc., P.S. Docket No. ll/95 (P.S.D. on Petition for Supplemental Order Nov. 30, l982).*/ In both decisions it was held that the product advertised was the garment itself, and not the garment combined with a diet, exercise and behavior modification program (P.S.D. July 30, l982 at pp. 7, 8, 20, 24; P.S.D. Nov. 30, l982 at pp. 7, 9-10). It was also decided in the earlier of the two decisions that the use of the garment was not effective in accomplishing the results represented (P.S.D. July 30, l982 at pp. 19-24).
The instruction to tighten the belt does not alter the product advertised or the enterprise conducted by Respondent. Moreover, in a hearing before an Administrative Law Judge, Respondent had a full opportunity to prove that the use of the product would accomplish the results represented. It failed to do so. The mere addition of the instruction does not entitle Respondent to a second opportunity to prove its case. Accordingly, a further hearing is not warranted.
In its Motion for Reconsideration, Respondent contends that "fine-spun districtions have been drawn in viewing" its advertisements and phrases have been taken out of context which led to the erroneous conclusion that Respondent continues to make the representations alleged in the Petition for Supplemental Order. Respondent reiterates an argument previously made that since ordinary obese persons know they must diet or exercise to lose weight, they would not interpret Respondent's advertising as making the representations alleged by Complainant.
Respondent cites various cases enunciating principles which it contends, if properly applied, would result in finding that it does not continue to make the representations previously found to be false. Contrary to Respondent's argument its advertising has not been viewed with the "lawyers eye for fine-spun distinctions" nor have phrases been taken out of context. In the prior decision the totality of Respondent's advertisements and the overall impression they would create on the ordinary mind wee considered in concluding that Respondent makes the representations alleged in Complainant's Petition for Supplemental Order (P.S.D., Nov. 30, l982 at pp. 5-9). Furthermore, where it was found that Respondent's advertising could at best be viewed as ambiguous, reliance was placed on the line of cases establishing that advertisements capable of two meanings can still be misleading (P.S.D. Nov. 30, l982 at p. 5). In addition, with respect to the knowledge possessed by the ordinary obese person, quoting from Gottlieb v. Schaffer, 141 F. Supp. 7, 16 (S.D.N.Y. 1956), it was stated: " t he fact that informed and sophisticated persons would readily recognize, laugh-off or even be amused by obviously false and absurd statements in an advertisement does not detract from their power to deceive the ignorant, gullible and less experiences" (P.S.D. Nov. 30, 1982 at pp. 8-9). finally, quoting from United States v. 95 Barrels of Vinegar, 265 U.S. 438, 443 (1924) it was pointed out: "' i t is not difficult to choose statements, designs and devices which will not deceive.' This Respondent has not done" (P.S.D. Nov. 30, l982 at p. 7).
Applying the above principles, the conclusion was reached that Respondent continues to make representations a, c, d and g of the Complaint. Respondent's Motion does not establish that this conclusion is erroneous.
Respondent is apparently arguing that its good faith and its refund policy, as well as the absence of customer complaints, shows that it is not in violation of 39 U.S.C. § 3005. The question of good faith, or intent to deceive, is not an issue in a proceeding under 39 U.S.C. § 3005. Conan Research, P.S. Docket No. 12/7 (P.S.D. July 29, l982); Identofax, P.S. Docket No. 13/56 (P.S.D. June 30, 1982; Contemporary Mission Inc.,
P.S. Docket No. 8/159 (P.S.D. June 30, 1981) and cases cited therein. Furthermore, neither the absence of complaints nor the existence of a refund policy serves to excuse a violation of the statute. Contemporary Mission, Inc., supra.; Athena Products, Ltd., P.S. Docket No. 7/99 (P.S.D. June 26, 1981) and cases cited therein; Oriental Nurseries, P.S. Docket No. 9/116 (P.S.D. May 19, 1981) and cases cited therein; Oriental Nurseries, P.S. Docket No. 8/24 (P.S.D. March 31, l981). Accordingly, this argument is without merit.
Respondent asserts that ex parte actions have been taken which have resulted in its being denied its due process rights. According to Respondent, as the result of these ex parte actions the nature of the proceeding was changed, Complainant was allowed to file a reply to Respondent's opposition to the Petition for Supplemental Order without obtaining Respondent's position n such filing, and Respondent was denied its right to receive remittances without a due process hearing.
Respondent's arguments are specious. The nature of the proceeding has not been changed on an ex parte basis. Both parties had a full opportunity to present their views on the nature of the proceeding prior to the issuance of the Judicial Officer's Order on Motion for a Bifurcated PRoceeding. Respondent's views were not solicited on Complainant's request to file a reply to Respondent's response to the Petition for Supplemental Order because the Judicial Officer, in his discretion, determined that such a reply would be of assistance in deciding the issues presented. For the same reason Respondent's request to file a response to the reply was granted without Complainant being given an opportunity to state its views. Finally, while the oral hearing requested by Respondent has not been held, it is because Respondent has not demonstrated there there are factual issues in dispute on which evidence should be taken. Moreover, Respondent has been given a fully opportunity to be heard on the issues presented by Complainant's Petition for Supplemental Order.
Thus, there was no denial of Respondent's due process rights.
Respondent's Motion for Reconsideration, its arguments in support of its request for a hearing, and its other arguments do not establish that the decision of November 30, l982, is in error or that hearing should be held. Accordingly, the False Representation Order requested by Complainant is issued with this decision.