In the Matter of the Complaint Against BEATRICE BAYLEY, MYRTLE RIKER, Box 55, Springhill Road at Sterling, PA 18463 P.S. Docket No. 8/40 July 8, 1987 James A. Cohen Judicial Officer APPEARANCES FOR COMPLAINANT: Sandra C. McFeeley, Esq. Richard T. Cooper, Esq. Kenneth N. Hollies, Esq. Consumer Protection Division Law Department United States Postal Service Washington, D.C. 20260-1112 APPEARANCE FOR RESPONDENT: Edward L. Norwind, Esq. Paulson, Nace & Norwind 1814 N Street, NW Washington, DC 20036-2404
Complainant has filed a Petition for Orders Based on Breach of Consent Agreement alleging that Kurt J. Schneider has breached the terms of a Consent Agreement which he executed on June 6, 1980, as owner and principal officer of Beatrice Bayley, Inc. Complainant contends that Mr. Schneider, through Respondent Beatrice Bayley (hereafter "Respondent"), continues to make certain of the representations which he agreed to discontinue in connection with the sale of a Family Heritage Book. Specifically, Complainant alleges that Respondent has resumed representing that persons remitting money in response to direct mail solicitations will receive a Family Heritage Book about the ancestry and family name of the addressee. As the result of the alleged breach, Complainant seeks the issuance of a False Representation Order pursuant to 39 U.S.C. 3005 against Beatrice Bayley or Beatrice Bayley, Inc. at Sterling, PA 18463.
On December 9, 1985, an Interim Detention Order as provided for in Paragraph 3 of the Consent Agreement was issued against Respondent. Prior to the issuance of this order, Respondent filed a Motion to Consolidate and Opposition to Petition for Orders Based on Breach of Consent Agreement. Respondent asked for consolidation of this case with P.S. Docket No. 22/113, another proceeding brought by Complainant concerning the promotion of the Family Heritage Book. Subsequently, Respondent withdrew its motion to consolidate and requested a hearing in this proceeding. A hearing was held in Washington, DC, on January 14 and July 16, 1986. The findings and conclusions that follow are based on the testimony presented at the hearing and the documents that have been made a part of the record.
Complainant originally initiated this proceeding on April ll, 1980, by filing a Complaint alleging that Respondent doing business under the names Beatrice Bayley and Myrtle Riker was conducting a scheme to obtain money through the mail by means of materially false representations in violation of 39 U.S.C. 3005. Paragraph 3(a) of the Complaint alleged that Respondent represented, directly or indirectly, that:
"Persons remitting money in response to its advertising materials will receive a * FAMILY HERITAGE BOOK specifically about the ancestry and family name of the addressee;"
The asterisk which appears in Paragraph 3(a) indicates the insertion of the surname of the particular addressee of the direct mail solicitation.
In lieu of formal proceedings under 39 U.S.C. 3005, Respondent executed the Consent Agreement and on Motion of Complainant, the proceeding was suspended indefinitely. By Paragraph 1 of the Agreement, Respondent agreed to discontinue making the representations challenged in Paragraph 3 of the Complaint, except that existing advertising materials could be used until exhausted, but no later than July 3, 1980.
After July 3, l980, Respondent promoted its Family Heritage Book by mailing postcards to selected addressees (Stipulations 4, 5, 6; CX-l through l6, 26). In the postcards, the book is referred to as the "(surname of addressee) Family Heritage Book", the (surname) Heritage Book, and the "Unique (surname) Family Book" (CX-l through CX-14, 16, 26). Altogether, the surname of the addressee is featured eleven times on the small postcard, six times in capital letters (CX-1 through CX-14).
The postcard is addressed personally to the recipient: "Dear Mr. (surname)." See , e.g. , CX-l, CX-8, CX-16. The reader is told that the (surname) Family Heritage Book "will lead you through the discovery and documentation of your personal and family heritage." The third paragraph of the postcard states that after exhaustive research the writer of the postcard has "located almost every (surname) member in the United States," and the next paragraph states that the surname is a rare name (CX-1 through CX-16, CX-26). In addition, the advertisements state that the book contains: "The history of our origins in the U.S." Id .
Some individuals who received these postcards formed the impression that the offered book was specifically about their ancestry and family name. They complained to the Postal Service about deceptive advertising when the book received did not meet their expectations (Pet., Decs. of McKenzie, Harrington, Colcock; CX-28, pp. 25-27, 41, 61-62, 85; CX-32, 33, 37; CX-39 through CX-47; CX-49; CX-51 through 56; 58; 60; 61).
Prior to the negotiation of the Consent Agreement, representatives of Respondent met with an attorney for Complainant to discuss the allegations of the Complaint and the procedural alternatives available to the parties (Tr. 156-159). Respondent did not at this meeting or at any time thereafter, submit any proposed advertising copy to the attorney for approval, and the attorney never approved any specific advertising language (Tr. 157-160; 172-173).
Complainant argues that Respondent has breached the terms of the Agreement by continuing to represent that persons remitting money in response to its direct mail advertising materials will receive a Family Heritage Book specifically about the ancestry and family name of the addressee. The truth or falsity of the representation is not in issue in this proceeding. See , Raymond Milo , P.S. Docket No. 12/168 (P.S.D. Dec. 31, 1981) and cases cited therein; see also Charles Wagner, d/b/a The American Way , P.S. Docket No. 24/10 (P.S.D. Oct. 28, 1986).
The test to be applied in interpreting advertising is the effect the advertisements taken as a whole would most probably produce on ordinary minds. See Donaldson v. Read Magazine, Inc. , 333 U.S. 178 at 189 (1948). In determining the effect of representations on ordinary readers, it is not necessary to find that all or even a majority of readers would be deceived. It is sufficient to find that readers, whether gullible or wary, would likely interpret an advertisement as making the alleged false representations. Moreover, the advertisments may be deceptive because they contain untrue statements or because statements which should be included are omitted. The reasonable implications of advertisements are to be given weight as well as express statements. Finally, advertisements which are susceptible of two or more meanings, one of which is false, are misleading. See e.g. , Donaldson v. Read Magazine, Inc. , supra ; United States v. 95 Barrels , 265 U.S. 438, 443 (1924); Spiegel, Inc. v. F.T.C. , 411 F.2d 481 (7th Cir. 1969); Rhodes Pharmacal Co., Inc. v. F.T.C. , 208 F.2d 382, 387 (7th Cir. 1953), aff'd in pertinant part, 348 U.S. 940 (l955); Baslee Products Corp. v. United States Postal Service , 356 F. Supp. 841 (D.N.J. 1973); Vibra-Brush Corp. v. Schaffer , 152 F. Supp. 461 (S.D.N.Y. 1957), rev'd on other grounds , 256 F.2d 681 (2nd Cir. 1958).
Applying these principles to the postcard solicitations distributed by Respondent, it is concluded that the postcards would most probably lead ordinary readers to believe that the book offered for sale contained specific information about their surnames and ancestry. There are numerous, emphatic references to the addressee's surname on the postcards, and the surname appears in the book's title. The use of the word "heritage" in descriptions of the book and in its title, construed together with the emphasis on the addressee's name, would most probably lead a reader to conclude that the book contains information about the addressee's ancestry. The "our" in the "history of our origins" and the phrase "unique (surname) Family Book" would also most likely convey the impression that the book contained information about the addressee's particular ancestry.
Respondent relies on the testimony of its expert witness to support its argument that while the pre-Complaint solicitations had language that could give the impression that the book was specifically about the customer's family name, no such language is included in the post-Complaint solicitations (Tr. 108-109). Although testimony of an advertisement's effect on the ordinary mind may be admitted into evidence, the question is one which may be determined by the presiding officer on the basis of the solicitations themselves. Vibra-Brush Corp. v. Schaffer , supra ; Borg-Johnson Electronics, Inc. v. Christenberry , 169 F. Supp. 746 (S.D.N.Y. 1959); Beatrice Bayley , P.S. Docket No. 22/113, (Sept. 16, 1986). Based on a review of the solicitations themselves, the testimony of Appellant's expert has not been found persuasive. The post-Complaint changes to Respondent's solicitations are not sufficient to counteract the surname-specific references and the other language which creates the overall impression that the book is about the ancestry and family name of the addressee.
Respondent argues that the Agreement should not be enforced because it relied on suggestions for advertising language made by a Postal Service attorney. However, Respondent did not establish by persuasive evidence that it reasonably relied on suggestions made by the Postal Service attorney or that he approved the language of the postcards. Although Respondent Schneider testified that a Postal Service attorney approved his advertising copy, he produced no written record of this approval (Tr. 28-30, 30-31, 34-35, 53-54, 58-59, 63-64), nor was he able to produce the advertising material which he claimed the attorney approved (Tr. 63-64). In addition, Mr. Schneider testified to being a participant in only one of a number of meetings held between the attorney and Respondent's representatives. The Postal Service attorney rebutted Respondent's evidence with testimony that he does not approve advertising language as a matter of policy and did not approve Respondent's language here (Tr. 157-159). Finally, it is noted that the Consent Agreement, which was signed by Mr. Schneider after a number of meetings had already taken place, specifically acknowledged that no Postal Service "officer, employee or agent" had approved any revised advertising material. Thus, there is no merit to this contention.
Respondent also maintains that Complainant is estopped as a matter of law from raising a breach of consent agreement claim because the Postal Service delayed bringing this action for five years after becoming aware of the distribution of Respondent's postcards. As a general rule, government delay in bringing an action is no defense to a suit to protect the public interest. See Utah Power & Light Co. v. United States , 243 U.S. 389, 409 (1917); Moneymakers , P.S. Docket No. 16/1 (P.S.D. June 20, 1984). In addition, there has been no showing that Respondent has been prejudiced by the delay. Goodman v. McDonnell Douglas Corp. , 606 F.2d 800, 804 (8th Cir. 1979), cert. den. 446 U.S. 913 (1980); Bottger v. Doss Aeronautical Services, Inc. , 609 F. Supp. 583, 588 (D. Ala. 1985); United States Postal Service v. Athena Products, Ltd. , (N.D. Ga. Civil Action 81-358A Memorandum Opinion dated March 30, 1981); The House of Renee , P.S. Docket No. 10/9, (P.S.D. Oct. 28, 1981). Here, the fact that the Postal Service did not seek to enforce the Agreement until the Petition was filed allowed Respondent to benefit from its advertising practices until November 1985. Therefore, Respondent was not prejudiced by the actions of the Postal Service.
Respondent has breached the terms of the Consent Agreement in the manner alleged in the Petition. Accordingly, pursuant to the terms of the Consent Agreement, a False Representation Order under 39 U.S.C. 3005 is being issued with this Decision.