In the Matter of the Complaint Against WORLD COMMUNICATIONS, INC. 6361 Yarrow Street Carlsbad, CA 92008-4829 and 6992 El Camino Real Carlsbad, CA 92008-5249 and JAY M. KHOLOS 6361 Yarrow Street Carlsbad, CA 92008-4831 and ENERGIZER Box 75 and Box 9000-173 Carlsbad, CA 92008-0975 and Box 31696 Omaha, Nebraska 68131-0696 P.S. Docket No. 19/33; 11/01/85 Grant, Quentin E. APPEARANCES FOR COMPLAINANT: Nan M.Kalthoff, Esq. Richard T. Cooper, Esq. Consumer Protection Division Law Department United States Postal Service Washington, DC 20260-1112 APPEARANCES FOR RESPONDENTS: Peter O. Safir, Esq. Nancy Singer, Esq. Kleinfeld, Kaplan & Becker 1140 Nineteenth Street, N.W. Washington, DC 20036-6601
Complainant has moved for clarification of Conclusion of Law No. 3 and for reconsideration of Finding of Fact No. 30 and Conclusion of Law No. 4 in the Decision on Petition and Supplemental Petitions for Breach of Consent Agreement herein, dated August 23, 1985.
Complainant is concerned that Conclusion of Law No. 3 improperly imposes on the United States Postal Service the burden of going forward with interpretative evidence extrinsic to advertisements in question where a respondent presents expert or lay opinion and/or a consumer perception survey on interpretation issues. Complainant says, also, that it is implicit in Conclusion No. 3 that the presiding officer will not exercise his independent judicial competence to interpret advertisements where respondent produces such evidence.
Complainant reads considerably more into Conclusion of Law No. 3 than was intended. It simply restates the longstanding rule as to judicial competence to interpret advertisements without benefit of evidence other than the ads themselves. It was intended to dispose of Respondent's argument that Complainant had failed to sustain its burden of proof on interpretation issues relating to printed advertisements (issues Nos. 2, 5, and 7) because it failed to present evidence extrinsic to the ads. Neither side presented such evidence with respect to printed advertisements. In cases where one or both parties present extrinsic evidence the presiding officer is not precluded from arriving at an interpretation based solely on his reading or viewing of the advertisements but may choose not to do so if he finds the extrinsic evidence more persuasive.
Conclusory Finding of Fact No. 30 found that Complainant had not met its burden of proof on Issue No. 1, i.e., whether Respondent's TV commercials represent that the ordinary person who takes the Grapefruit 45 pills alone will lose a substantial amount of weight in a short period of time. This finding was based on Respondent's consumer perception survey (RX-24) and the testimony of Respondent's expert Dr. George Belch concerning average levels of miscomprehension of television commercials (Finding of Fact No. 28).
Complainant requests reconsideration of Finding of Fact No. 30 and related Conclusion of Law No. 4. Complainant argues that it met its burden of proof on Issue No. 1 because Respondent's own consumer perception survey showed that a significant percentage of survey participants (an average of 20%) believed, after viewing two of Respondent's TV commercials, that it is possible to lose weight by just using the Grapefruit 45 pill. Finding of Fact No. 28 discounted these percentages on the basis of Respondent's expert testimony as to average levels of miscomprehension of television advertising.
On review of Respondent's commercials and the evidence concerning miscomprehension levels, I conclude that there was no sound basis on which to apply such levels in this case.
On the basis of advertising literature and, primarily, a consumer comprehension survey designed by him and his brother, Dr. George Belch expressed the opinion that the average 20% of the perception survey participants who believed the ads represented weight loss achievement by just using the pill "might have gotten a wrong representation or miscomprehended the commercial" (Tr. 468). The evidence shows that the participants in the comprehension survey were tested for comprehension of relatively simple, clear assertions or claims made in TV commercials for four health-care products (Tr. 470-471).
Respondent's Grapefruit 45 commercials did not contain a straight-forward, clear statement that the Grapefruit 45 plan included a diet necessary to achievement of weight loss. References to a diet were few and obscure. The commercials focused on the pill and on consumption of delicious foods (Findings of Fact Nos. 16, 17). Therefore, I conclude that the 20% of participants who expressed belief that ingestion of the pill alone would produce weight losses were not miscomprehending a clear representation in the ads. Rather, they were giving a possible and reasonable interpretation to ambiguous advertisements.
Where an advertisement is ambiguous or capable of more than one meaning, if one of those meanings if false, the advertisement will be held misleading. Rhodes Pharmacal Co. v. Federal Trade Commission, 208 F.2d 382, 387 (7th Cir. 1953); Intra-Medic Formulations, Inc., P.S. Docket No. 19/182, (P.S.D., p. 38, September 10, 1985); Ralph J. Galliano, P.S. Docket No. 19/15 (P.S.D., p. 9, May 2, 1985).
In determining the effect of representations on ordinary readers, it is not necessary to find that all readers interpret an advertisement as making a representation alleged by the Postal Service but only that a significant number of readers could so interpret the advertisement. The issue is whether the language is liable to deceive, not if it will deceive everyone. Oriental Nursery, Inc., P.S. Docket No. 9/116 (P.S.D. May 19, 1981), citing Donaldson v. Read, 333 U.S. 178, 189 (1948); U.S. v. 95 Barrels of Vinegar, 265 U.S. 438, 443 (1924); Gottlieb v. Schaffer, 141 F. Supp. 7, 16 (S.D.N.Y. 1956); Rhodes Pharmacal Co. v. Federal Trade Commission, supra.
I find that 20% of viewers of a television commercial is a significant number. See Benrus Watch Co., 64 F.T.C. 1018, aff'd 352 F.2d 313, 319-20 (8th Cir. 1965), cert. den., 384 U.S. 939 (1966); Firestone Tire & Rubber Co. v. F.T.C., 481 F.2d 246, 249 (6th Cir. 1973), cert. den. 414 U.S. 1112 (1973).
On reconsideration of Findings of Fact Nos. 30, and, necessarily, 28 together with Conclusion of Law No. 4, I find that Complainant has sustained its burden of proof as to Issue No. 1. Respondent's TV advertisements make the representation that the ordinary person who takes the Grapefruit 45 pills alone will lose a substantial amount of weight in a short period of time.
In reaching this conclusion, the arguments of both parties have been fully considered.