In the Matter of the Complaint Against THE AMERICAN MINT, 1718 Connecticut Avenue, N.W., Washington, DC 20009-1148, THE AMERICAN MINT, 226 Massachusetts Avenue, N.E., Washington, DC 20002-4960, THE AMERICAN MINT, 111 S. Olive Street, Media, PA 19063-3302, THE AMERICAN MINT, 510 Beatty Road, Springfield, PA 19064-1510 and JOSEPH W. ENGLAND, 510 Beatty Road, Springfield, PA 19064-1510 P.S. Docket No. 23/110 June 16, 1987 James D. Finn, Jr. Associate Judicial Officer APPEARANCES FOR COMPLAINANT: Kenneth N. Hollies, Esq. Timothy J. Mahoney, Esq. Law Department United States Postal Service Washington, DC 20260-1112 APPEARANCES FOR RESPONDENTS: Ian D. Volner, Esq. N. Frank Wiggins, Esq. Robert Clifton Burns, Esq. Cohn and Marks 1333 New Hampshire Avenue, N.W. Suite 600 Washington, DC 20036-15ll
On May l9, l986, Complainant, the United States Postal Service, filed a "First Petition For Orders Based On Breach Of Consent Agreement" (hereafter First Petition) in which it alleged that Respondents had breached the terms of a Consent Agreement executed on March 28, l986 by Respondent, Joseph W. England in his individual capacity and as President and owner of The American Mint. A "Second Petition For Orders Based On Breach Of [the same] Consent Agreement" (hereafter Second Petition) was filed by Complainant against these Respondents on August l3, l986. Complainant contends in these Petitions that Respondents, using the name The Historic Pennsylvania Mint, have resumed the activities which Mr. England agreed to discontinue. Specifically, Complainant alleges that Respondents' coin advertisements contain representations which violate six provisions of paragraph 6 of the Consent Agreement. Further, Complainant alleges an additional violation - Respondents' failure to keep certain records pertaining to its advertising claims and the Agreement. The specific allegations of the Petitions are contained in the Findings of Fact, infra .
In its First Petition, Complainant sought the issuance of a temporary detention order against mail addressed to The Historic Pennsylvania Mint, 2300 Walnut Street, Philadelphia, Pennsylvania l9l03-5552. On the basis of the information attached to the First Petition, a temporary detention order was issued on May 2l, l986. The Order authorized the temporary detention of the mail and granted Respondents ten days in which to respond to the Petition. A response, seeking dismissal of the Petition and requesting a hearing, thereafter was filed by Respondents.
A hearing was scheduled for July 8, l986, but attorney schedule conflicts, difficulties in scheduling witnesses, and the filing of the Second Petition by Complainant caused a delay in the hearing until October l4, l986. At the hearing upon Motion by Complainant the parties agreed the May 2l, l986, Interim Detention Order would be broadened by the inclusion of an additional address for mail addressed to The Historic Pennsylvania Mint, namely, lll S. Olive Street, Media, Pennsylvania l9063-3302. A confirming Order was issued on October 2l, l986.
At the hearing Complainant rested its case in chief without calling any witnesses, electing to rely on the contents of the Consent Order, Respondents' advertisements, and the transcript of the testimony of Mr. Francis B. Frere presented at the hearing in The National Gold Mint, P.S. Docket No. 22/165 (P.S.D. May 1, 1987). Mr. Frere is the Assistant Director of Marketing, United States Mint, and was qualified in The National Gold Mint hearing as an expert in consumer perceptions relating to the sale of coins and medals. Respondents called as witnesses Mr. Jerome Kossoff, the owner of a market research company, and Mr. Jerry Harwood, an expert in testing consumer perceptions and the evaluation of consumer perception testing instruments. Complainant called two rebuttal witnesses, Postal Inspectors Michael Mague and Jack Thornton. Both parties introduced exhibits into the record.
The parties requested and were given an opportunity to file proposed findings of fact and conclusions of law. Both parties made such filings, and additionally each party filed a reply to the other party's proposed findings and conclusions. The record was closed December 29, 1986. The findings of fact and conclusions of law proposed by the parties have been fully considered in the preparation of this Decision and adopted to the extent reflected in the findings and conclusions and otherwise rejected as irrelevant or contrary to the evidence.
1. On March 28, l986, Respondent Joseph W. England executed a Settlement Agreement Containing Consent Order To Cease and Desist ("The Agreement") on behalf of Respondent, The American Mint, as its President and owner, and on his own behalf as an individual. Under the terms of paragraph 6.A. of the Agreement Respondents agreed that they would discontinue any advertisements for the mail order sale of any coin, medallion, medal or other similar product which contained representations that:
1) The minting or offering for sale of such product was officially commissioned or sanctioned by any part of the United States Government, or any other government;
2) A respondent is affiliated with or otherwise acts as an official arm of the United States Government or any other government in connection with sales of any such product;
3) The lower registration numbers assigned to early orders for such products impart value to the purchase different from the higher registration numbers assigned to later orders;
4) Any such product is legal tender in the United States or anywhere else;
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The Respondents additionally agreed that advertisements containing such representations would not be resumed directly or indirectly under any name or names or through any corporate or other device.
2. In paragraph 6.C. of The Agreement Respondents additionally agreed that their advertisements for the mail order sale of coins, medallions or other similar products would discontinue representing that:
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D) The seller of such product is affiliated or otherwise associated with a government or private entity in connection with such sales;
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F) Such product has any historical significance;
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The paragraph further provided that advertisements containing such representations would not be resumed unless Respondents possessed and relied upon reliable and competent evidence substantiating such claims prior to public dissemination. Reliable and competent evidence was thereafter defined and Respondents were required to keep such evidence available for Complainant's inspection. Additionally, under paragraph 12 of The Agreement Respondents agreed to keep accurate records of all matters related to the administration of or compliance with any paragraph of The Agreement.
3. Paragraph 8 of The Agreement provided that in the event of breach of The Agreement the Judicial Officer (including Associate Judicial Officer upon delegation) may issue an order of the type described in 39 U.S.C. 3005(a)(l) and (2), as well as any interim order. The parties also agreed the Judicial Officer could issue a supplemental cease and desist order in the event of breach of The Agreement, which supplemental order could be directed to additional persons and prohibit additional actions.
4. Complainant's First Petition alleges that Respondents, using the name "The Historic Pennsylvania Mint," placed advertisements in the Detroit Free Press and New York Daily News which contained the representations that Respondents had agreed in paragraph 6.A. of The Agreement to discontinue. Respondents admit placing the advertisements under the name The Historic Pennsylvania Mint, but deny the advertisements contain the representations prohibited by paragraph 6.A. of The Agreement (First Petition; Supplemental Reply).
5. Complainant's Second Petition alleges that Respondents' advertisements contain the representation that Respondent, The Historic Pennsylvania Mint, is affiliated with the Statue of Liberty-Ellis Island Foundation, a representation prohibited by paragraph 6.C. of the The Agreement (Finding No. 2, supra ), thereby breaching The Agreement. The Petition further alleges that the advertisements in question represent Respondents' product has historical significance, a representation likewise contrary to the terms of The Agreement. Finally, Complainant alleges Respondents breached the provisions of paragraphs 6.C. and 12 of The Agreement pertaining to the requirement to keep available for Postal Service inspection reliable and competent evidence substantiating its representations, and accurate records of matters pertaining to the administration of and compliance with The Agreement. Respondents contest each of these allegations (Second Petition; Respondents' Pre-Hearing Submission).
6. Respondents' advertisement in the Detroit Free Press was approximately one-half vertically of a standard size newspaper page. l / The top portion of the advertisement pictured the obverse and reverse sides of a silver or gold piece contained within a rectangle approximately 3-3/4 inches by 6-l/4 inches. The obverse of the piece showed the head of the Statue of Liberty along with the inscription "1886 * LIBERTY CENTENNIAL * 1986" along the circumference of the bottom half of the piece. The reverse side showed a traditional eagle with a banner which stated "Olde New England Mint" flowing across its wings and under its neck. Nineteen stars were interspersed throughout the design and the word "AMERICAN" was inscribed along the top circumference of the piece with the words "100th ANNIVERSARY" inscribed along the bottom circumference. A smaller inscription "l oz. .999 Fine Silver" was also contained on the reverse. A one-inch banner headline consisting of two lines was both above and below the rectangle containing the replicas of the pieces. The top headlines stated in dark black print "Proof Edition First Day Of Issue." The bottom headline, also in dark black, stated "Statue Of Liberty Silver & Gold Pieces." In smaller dark print followed the introductory statement that "The Historic Pennsylvania Mint Announced Today the Limited Release of the l00th Anniversary Liberty Gold and Silver Pieces."
Other headlines throughout the advertisement were approximately 3/l6" high and stated "Solid Silver," "Connoisseur's Gold," "First Day of Issue," and "Price Guaranteed." The advertisement also contained other language pertinent to this matter in regular size l/8" print:
l / The other advertisement in the record was from the New York Daily News . It is a photocopy, however, and it cannot be determined if its size has been reduced. The text of the advertisements is the same.
"Created expressly to honor the 100th anniversary of the Statue of Liberty, these beautiful Gold and Silver pieces feature a detailed portrait of the Statue of Liberty double dated 1886-1986 on the front and a traditional heraldic eagle on the reverse. Every one is individually die struck to bring out the exquisite detail, deep dimension, and mirror-like background most prized by collectors and investors. Each is, of course, individually registered for your protection.
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The Silver Liberties are 39mm in diameter, slightly larger than a U.S. Silver Dollar, and weigh a full ounce of .999 fine Solid Silver. They are struck by The Historic Pennsylvania Mint, one of America's premier private mints not affiliated with the U.S. Government, in limited quantities in both Mint and Proof Editions (Edition Limits 25,000 Mint and l5,000 Proof). There is a strict limit of not more than 5 of each per order.
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The Liberty Gold and Silver Liberties are accompanied by a very special U.S. Postal First Day of Issue. For the first time ever, Frederic Bartholdi, sculptor of the Statue of Liberty has been commemorated on a U.S. Postal Service 22[ stamp. This unique issue features a portrait of Bartholdi in the foreground, and the Statue of Liberty silhouetted against a twilight skyline in the background. A First Day cover featuring this beautiful Postal Commemorative will accompany each Liberty.
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IMPORTANT NOTE
The serial number you receive will be determined by the date we receive your order. And, of course, lowest serial numbers are always shipped first. To receive the lowest possible number, we urge you to act promptly."
The pieces were priced at $25 for the silver mint condition, $30 for the silver proof edition and $165 for the gold. A minute disclaimer was contained at the very bottom of the advertisement under the mail order coupon. It stated, "The Historic Pennsylvania Mint is one of America's foremost private mints and is not affiliated with the U.S. Government" (Exhibit 3 to First Petition).
7. By agreement of the parties the testimony of Complainant's expert, Francis G. Frere, Assistant Director of the United States Mint for Marketing, was received in evidence in the form of a certified copy of the transcript of Mr. Frere's direct, cross and redirect examination taken in another proceeding, The National Gold Mint, P.S. Docket No. 22/l65 (P.S.D. May l, l987). Likewise by agreement of the parties Respondents' cross examination of Mr. Frere was received in evidence by means of a deposition taken of Mr. Frere by counsel for Respondents in September l986. The Administrative Law Judge in The National Gold Mint case found Mr. Frere to be a "highly qualified expert in numismatics and in consumer perceptions relating to the sale of coins and medals" (Initial Decision, p. ll). This finding was affirmed in the Postal Service Decision wherein it was stated at p. l3 "[t]he evidence cited by the Administrative Law Judge in support of Mr. Frere's qualifications and degree of expertise in the area of consumer perceptions is impressive and persuasive" and "[h]is qualification as an expert in consumer perceptions in the area of coin marketing was established by a preponderance of the evidence." Despite the arguments presented by Respondents the cross examination conducted of Mr. Frere in this proceeding in no way diminished his impressive credentials or limited his area of expertise. For purposes of this proceeding he is recognized as an expert in numismatics and consumer perceptions relating to the sale of coins and medals.
8. Several facts relevant to the issues herein are established by Mr. Frere's testimony. Stars appear on United States coins, especially gold coins where there is heavy use of stars (National Gold Mint Transcript (NGM Tr.) 80-8l, 90). Gold coins ordinarily have a replica of the eagle on the reverse side (NGM Tr. 84). In addition, a gold coin often is designated as an eagle (NGM Tr. 84-85). The word "piece" often refers to a coin, especially a gold coin, and the general public often perceives a "piece" to be a coin (NGM Tr. 88, 93-94; Respondents' Exhibit (RX)-1, p. 24-27). United States Mints are located in Philadelphia, Pennsylvania, and in Denver, Colorado (NGM Tr. 72). In referring to the location of a United States Mint the first conception of the public would be that the Mint is located in Philadelphia (RX-1, p. 38).
9. The United States Mint, as authorized by Congress, issued three new coins to commemorate the centennial of the Statue of Liberty. The date of issue was January l, l986. The coins were designated Liberty Coins and the issuance consisted of a Liberty Silver Dollar Coin, a Liberty Gold Five Dollar Coin and a Liberty Half-Dollar Coin. The silver dollar depicted the Statue of Liberty and the Ellis Island immigration building on the obverse and Liberty's torch on the reverse. The gold five dollar showed a close-up of Liberty's crowned head on the obverse and an American eagle in flight on the reverse. The half dollar showed a profile of the Statue against the New York skyline on the obverse and an immigrant family on the reverse. The regular price for the silver dollar (proof edition) was listed at $24 and $22 for the uncirculated coin. The gold five dollar coin was priced at $175 (proof) and $165 (uncirculated). The words "United States of America," "E Pluribus Unum," "In God We Trust," "Liberty" and the denomination are required by law to be shown on the coins (Exhibit A to RX-1; NGM Tr. 80, 89).
10. Respondents contracted with a market research company for the performance of a survey pertaining to their advertisements in issue in this proceeding. The survey was received in evidence in the hearing. The purpose of the survey was to generate some quick data on consumer perceptions of the advertisements. It was not a national probability sample and was not designed and conducted in a manner to yield the most probative answers possible on the questions posed (Transcript (Tr.) 15-20, 49-50). The questions were designed primarily by the market research company with assistance from and consultation with Respondent Joseph English and his counsel (Tr. 26). The survey was taken of 307 people with approximately half located at a shopping mall in Syosset, New York, and half in the Westwood area of Los Angeles (RX-2; Tr. 18, 41). The Syosset interviewers were properly trained. The record does not reflect the training and expertise, if any, of the Los Angeles interviewers (Tr. 35-36). Approximately 77 percent of those interviewed had some college education, with 54 percent earning degrees of some nature. Of those interviewed 82.5 percent earned more than $25,000 per year and 55 percent earned more than $40,000 per year. Approximately 65 percent of those surveyed were between the ages of 35-54 (RX-2). The responses to four of the questions asked (Nos. 2-5) support Respondents' position that their advertisments do not make some of the representations alleged by Complainant (RX-2).
11. Postal Service Inspectors conducted a survey by mail, called a circularization, of Respondents' advertisements. The survey was received in evidence. It consisted of a cover letter sent to previous customers of The Historic Pennsylvania Mint along with a photocopy of the advertisement and a questionnaire containing eight specific questions (Complainant's Exhibit (CX)-1; Tr. 69, 113). The bottom of the advertisement, which contained the very small disclaimer language, was not photocopied clearly enough for the recipient to be able to read the disclaimer (Tr. 78). The questionnaire was inartfully drafted and somewhat confusing (CX-1; Tr. 88-92; 127-30). The survey's results support some of Complainant's contentions that Respondents breached The Agreement (CX-3).
The issue to be decided in connection with a Petition for Breach of a Consent Agreement is whether the party signing the agreement has breached its terms by continuing to make the representations which it agreed to discontinue. The determination of the truth or falsity of the representations is generally not in issue. Mark Eden v. Lee, 433 F.2d 1077 (9th Cir. 1970); Nancy Pryor, Inc. v. United States Postal Service , Civil Action No. 80-1933 (D.D.C. 1981); American Consumer Inc. v. United States Postal Service , 427 F. Supp. 589 (E.D. Pa. 1977).
In presenting their respective positions each party has placed great emphasis on the contents of its survey and on the alleged infirmities of the other party's survey. Respondents argued at hearing and in a supplemental memo that Complainant's survey should not have been received in evidence as it constituted inadmissible hearsay. This issue previously has been discussed in Ralph Galliano, P.S. Docket No. 19/15 (P.S.D. May 2, 1985):
It is generally recognized that survey evidence falls within one or more of the exceptions to the hearsay rule set forth in 803 of the Federal Rules of Evidence. It has been held to constitute an exception under 803(1) as a present sense impression or 803(3) as a statement of the declarant's then existing state of mind. [Citations] Surveys have also been admitted under 803(17) as compilations relied on by persons in particular occupations.
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It appears to be the majority view that relevant surveys are admissible under one or more of the above hearsay exceptions and that evidence with respect to technical unreliability merely goes to the weight accorded to the survey. The Prudential Insurance Co. v. Gibraltar Financial Corp ., 694 F.2d 1150 (9th Cir. 1982), cert . denied , 103 S. Ct. 3538, 77 L.Ed. 2d 1389 (1983); Ellis v. International Playtex, Inc . [745 F.2d 292 (4th Cir. l984)].
The decision went on to point out that some courts have taken a more restrictive view of admissibility of survey evidence, requiring evidence of trustworthiness, accuracy and reliability as a prerequisite to the survey's admissibility, citing Baumholser v. Amax Coal Co ., 630 F.2d 550 (7th Cir. 1980). In Galliano the survey in question was deemed admissible under either evidentiary rule, since ample evidence of its reliability and trustworthiness existed. Factors to be considered for evidentiary reliability of surveys are set forth in Pittsburgh Press Club v. United States , 579 F.2d 751, 758 (3rd Cir. 1978) as follows 2 /:
"A proper universe must be examined and a representative sample must be chosen; the persons conducting the survey must be experts; the data must be properly gathered and accurately reported. It is essential that the sample meet the standards of objective surveying and statistical techniques. Just as important, the survey must be conducted independently of the attorneys involved in the litigation. The interviewers or sample designers should, of course, be trained, and ideally should be unaware of the purposes of the survey or the litigation. A fortiori , the [survey] respondents should be similarly unaware."
Unlike the survey in Galliano which was deemed trustworthy and reliable, neither party's survey in this matter possesses such characteristics. Thus, although admitted into evidence under the more liberal rule ( Prudential Insurance Co. v. Gibraltar Financial Corp ., supra ), little weight is being given to either survey in resolving the issues in this matter. Respondents' survey was by their own admission generated to obtain some quick data on consumer perceptions of the advertisements. It was not a probability sample and was not conducted in a manner to obtain the most probative possible answers. Additionally, the representative nature of it appears questionable due to the relatively high educational and income levels of those interviewed. Two other criteria of reliability set forth in Pittsburgh Press Club , supra , were not satisfied. First, counsel for Respondents assisted in the design of
2 / Galliano and Pittsburgh Press Club were cited with approval in United Commercial Insurance Services , P.S. Docket No. 19/l8 (P.S.D. Nov. l986).
the questions. Second, there was no proof in the record pertaining to the expertise of the Westwood interviewers. Its results therefore are being given little weight, as are the opinions of its expert witness, Mr. Harwood, who testified as to the conclusions to be drawn from the results of the survey.
Complainant's mail survey was just as suspect. As stated in the findings of fact, it was inartfully drafted and confusing. Further, the recipients were not given a clear copy of the complete advertisements. Thus, its results also are being given little weight. Neither survey has much probative evidentiary value.
In interpreting advertisement representations the probable impact of the advertisement upon ordinary minds is the test to be applied. The impression of advertising on the ordinary mind may be determined by the trier of fact solely on the basis of the advertising itself. Vibra Brush Corp. v. Schaffer , 152 F. Supp. 461, 468 (S.D.N.Y. 1957), rev'd on other grounds 256 F.2d 681 (2d Cir. 1958); Associated Telephone Directory Publishers, Inc ., P.S. Docket No. 13/191 (P.S.D. Jan. 25, 1984). Deception may be present in advertisements when they contain untrue statements or when statements which ought to be contained are omitted. In considering the interpretation which ought to be given to advertising claims, the reasonable implications arising from the claims are to be given weight as well as those claims which are stated expressly. Donaldson v. Read Magazine, Inc ., 333 U.S. 178 (1948); Spiegel Inc. v. F.T.C. , 411 F.2d 481 (7th Cir. 1969); Baslee Products Corp. v. U.S.P.S. , 356 F. Supp. 841 (D.N.J. 1973); Vibra Brush Corp. v. Schaffer , supra . Applying these principles to Respondents' advertising materials, it is concluded that Respondents have breached The Agreement.
Complainant's initial allegation of breach of The Agreement by Respondents is that Respondents' advertisement represents that the minting or offering of its product is officially commissioned or sanctioned by the United States Government. Its second allegation of breach, that the advertisement represents that Respondent is affiliated with the United States Government, is of a nature similar enough to the first allegation to allow consideration of the two together.
A reading of the advertisement and comparison of the pieces depicted in it with the United States Mint's Statue of Liberty offering supports the first two of Complainant's allegations of breach. The advertisement itself is headlined "Statue of Liberty Silver and Gold Pieces." The head of the Statue of Liberty is shown on the medal at the top of the advertisement. The pieces are described in the text of the advertisment as "Gold and Silver pieces", "Silver Liberties", "Liberty Gold and Silver Liberties", names substantially similar to the United States Mint's "Liberty Silver Dollar" and "Liberty Gold Five Dollar" offerings. Additionally, the general public often perceives the term "piece" or "pieces" to mean a coin or coins. Other portions of the advertisement suggest either Government control, affiliation, or sponsorship. First, a United States Postal Service first day of issue stamp showing Frederic Bartholdi, sculptor of the statue, was offered as a bonus to those who ordered Respondents' pieces. Additionally, the Philadelphia, Pennsylvania, location of the Historic Pennsylvania Mint might well suggest to consumers a Government affiliation, since the United States Mint is located in Philadelphia. Finally, it is noted that the price of Respondents' gold pieces, $165 each, was the same as the United States Mint's uncirculated five dollar Liberty Gold, and just ten dollars less than the Mint's proof Liberty Gold. Respondents' silver piece mint condition likewise was priced similarly to the Mint's Liberty Silver Dollar ($25 versus $24 for the Mint's proof edition). The pricing similarities could tend to confuse the ordinary reader and lead some to believe the offered pieces were Government coins.
Respondents' pieces show a close up of Liberty's crowned head on the obverse, as does the United States Mint's gold five dollar coin. Both show an eagle on the reverse. Respondents' pieces contain nineteen stars on its reverse. United States gold coins ordinarily contain stars. The accumulation of all of these facts leads to the conclusion that Respondents' advertisement represents both that the minting or offering of its product was commissioned or sanctioned by the United States Government and that Respondents are affiliated with the United States Government. Such representations breach The Agreement.
Respondents contend that disclaimer language in its advertisement which states in small print in the middle of the advertisement's text "[t]hey are struck by The Historic Pennsylvania Mint, one of America's premier private mints not affiliated with the U. S. Government" absolves it of any misrepresentation. The disclaimer, however, is so inconspicuous that it does not diminish the effect of the false representation. Leo Daboub , P.S. Docket No. 19/185 (P.S.D. July 10, 1986). The other disclaimer in Respondents' advertisement, contained at the very bottom, is so minute as to be close to unreadable. It gives no protection or information to the unwary.
Complainant alleges breach of that portion of The Agreement in which Respondents agreed to refrain from advertising that the lower registration numbers assigned to early orders for its products give value to the purchase different from higher numbers assigned to later orders. The language in controversy is that contained under "IMPORTANT NOTE" in the advertisement (Finding of Fact No. 6, supra ).
Respondents' Proposed Findings of Fact and Conclusions of Law stipulate to an extension of The Agreement to discontinue the future use of that specific language or language similar to that contained in the "IMPORTANT NOTE." Respondents further state that in light of their willingness to so stipulate no adjudication for the relief requested is required and none should be made.
The language in issue in the advertisement advises purchasers that lower serial numbers are determined by the date the orders are received by Respondents and then are shipped first. Purchasers are urged to act promptly to obtain the lowest possible serial number. A reasonable interpretation of the message imparted by such language is that lower registration numbers are of more value than higher ones otherwise there would be little reason to obtain the lower numbers. Thus, Respondents' advertisement makes a representation that it agreed in The Agreement to refrain from making, thereby breaching The Agreement. Respondents' present offer to agree to a revised Consent Order is of no consequence since the existing Order already prohibits the representation in issue.
Complainant's next allegation of breach is that Respondents' advertisement represents that its pieces are legal tender. Since it has been determined that the advertisement can be interpreted by the reader of ordinary mind to contain representations that the minting or offering of Respondents' product was officially commissioned or sanctioned by the United States Government and the Respondents are affiliated with the United States Government, it logically follows that their offering reasonably could be construed to be legal tender. This conclusion is buttressed by the fact that the general public often perceives a "piece" to be a coin, or legal tender. Respondents thus breached The Agreement once more.
In its Second Petition Complainant alleges Respondents' advertisements represent The Historic Pennsylvania Mint is affiliated with the Statue of Liberty-Ellis Island Foundation and that Respondents' product has historical significance, thereby breaching paragraph 6.C. of The Agreement. The record in this matter is devoid of any evidence that Respondents are affiliated with the Foundation itself, nor can any such conclusion be drawn from the contents of the advertisement. In regard to the issue of historical significance The Agreement may be read two ways, the first being that Respondents agreed not to represent the product itself had any historical significance; the second being that Respondents agreed not to offer to the public a product which depicts an historical event. The first interpretation is the more literal one, and no language in the advertisement represents the pieces themselves have any historical significance. There is no evidence in the record that the second interpretation may have been what the parties intended. The record thus is insufficient to support a finding that Respondents breached The Agreement under either interpretation.
Finally, the record likewise contains no substantive evidence that Respondents were derelict in the record keeping obligations required of them by paragraphs 6 and 12 of The Agreement. This issue was not addressed in any evidentiary nature by Complainant at the hearing in this matter. No breach of The Agreement is found against Respondents on this issue.
Complainant asks for the issuance of an order under 39 U.S.C. 3005 and additional relief in the form of a supplemental order to cease and desist, which expands the prohibitions of the initial order. The proposed supplemental order to cease and desist is comprised of five parts. Part one would prohibit Respondents from using a name "evocative" of the United States Government or any location where the United States Mint has ever "created or distributed" coins; and prohibit the use of the words or phrases "mint," "piece" or "limited offering" in its advertisements. Part two would require Respondents to stop failing to disclose that their solicitations are not government affiliated. Part three would require Respondents' solicitations to include additional information of the offering entity's corporate name and address. Parts four and five impose additional record keeping and reporting requirements on Respondents.
Expansion of the order to cease and desist as requested by Complainant is either unnecessary, not warranted by the evidence of record, or, in one instance, could create a confusing document. The existing order already prohibits a representation of government affiliation, a prohibition requested by Complainant in part one of the proposed order. Additionally, no evidence is contained in the record that the reader of ordinary mind would equate all the identified minting or distribution centers with present United States Mint or Government operations. Other prohibitions requested in part one, considered individually, could well prohibit the contents of an advertisement which would not contain a false representation. Thus, for example, the use of the word "piece" in an offering, which otherwise was not suggestive of government affiliation or the sale of legal tender, might well be harmless and create no false impression to the reader of ordinary mind. Part two of the proposed supplemental order is drafted without clarity, containing too many negatives to impart a clear meaning. In regard to part three of the proposed order the record does not indicate that the inclusion of the additional information in future advertisements would act to eradicate any false representations in Respondents' advertisements not already prohibited by the existing cease and desist order. It would close no loopholes otherwise existing and would require the Judicial Officer or designee to prescribe, rather than proscribe, the contents of certain advertisements. Finally, no need has been shown for the additional record keeping and reporting requirements requested in parts four and five, as no evidence has been presented that other similar requirements of the existing cease and desist order are inadequate. Accordingly, Complainant's request for a supplemental order to cease and desist is denied.
In summation, Respondents are found to have breached subparagraphs l, 2, 3 and 4 of paragraph 6.A. of The Agreement. No breach of paragraph 6.C. occurred. Pursuant to paragraph 8 of The Agreement, an order under 39 U.S.C. 3005 is being issued contemporaneously with this Decision.