In the Matter of the Complaint Against
CAMERA HUT
1505 Wallace Drive
Carrollton, TX 75006-6639;
S & H MARKETING GROUP, INC.
1505 Wallace Drive
Carrollton, TX 75006-6639;
CDL MARKETING, INC.
14554 Overview Drive
Dallas, TX 75240-8120;
CARL D. LANDON
14554 Overview Drive
Dallas, TX 75240-8120
P.S. Docket No. 33/43
11/21/89
James A. Cohen, Judicial Officer
APPEARANCES FOR COMPLAINANT: Jennifer Yopes Angelo, Esq.
Alan B. Ostroff, Esq.
Consumer Protection Division
Law Department
United States Postal Service
Washington, DC 20260-1144
APPEARANCES FOR RESPONDENTS: Anne K. Bingaman, Esq.
Jeffrey D. Watkiss, Esq.
Powell, Goldstein, Frazer & Murphy
1001 Pennsylvania Avenue, N.W.
Sixth Floor
Washington, DC 20004-2582
Bruce E. Longenecker, Esq.
8300 Douglas Avenue
Suite 800
Dallas, TX 75225-5603
PETITION FOR SUPPLEMENTAL ORDERS
Complainant has filed a Petition for Supplemental Orders alleging that Respondents Camera Hut, CDL Marketing, Inc. and Carl D. Landon (hereinafter referred to as Respondents) in connection with a solicitation for a "35 mm Quickshot Camera" are making a false representation prohibited by a Cease and Desist Order previously issued in this proceeding. Complainant also alleges that Respondents are making several new false representations in their solicitation. Complainant thus requests the issuance of a supplemental False Representation Order and Cease and Desist Order.
Respondents have filed a timely Answer in which they oppose the issuance of the Orders sought in the Petition, and deny that the new solicitation violates the previously-issued Cease and Desist Order. Respondents also contend that supplemental proceedings are inappropriate when new false representations are alleged, and that in any event Complainant's allegations of new false representations are unsupported.
Following the filing of a Complaint and one Amendment thereto, Complainant, on March 1, 1989, filed a Second Amended Complaint in which it alleged that Respondents were engaged in conducting a scheme or device for obtaining money through the mail by means of false representations in violation of 39 U.S.C. § 3005. Specifically, paragraph 9 of the Second Amended Complaint alleged that Respondents' postcard solicitation, offering delivery of a camera after payment of the amount of $12.65, falsely and materially represented that:
"(a) The recipient of respondents' postcard ('recipient') has ordered and/or authorized the shipment of the camera;
(b) The payment requested on the postcard is entirely for insuring the camera;
(c) The camera is so valuable that $12.65 is required to insure it;
(d) The cost of the camera itself has already been paid;
(e) The camera has an automatic mechanism which adjusts the focus of the lens."
On March 14, 1989, Respondents filed a Notice of Default, in which they, in effect, abandoned their intention to present a defense to the allegations in the Second Amended Complaint and consented to the issuance of the Cease and Desist and False Representation Orders requested by Complainant. On referral from the Administrative Law Judge, the Judicial Officer issued Cease and Desist Order No. CD-2474 and False Representation Order No. 89-17 against Respondents. The Cease and Desist Order prohibited Respondents from making the representations alleged in paragraph 9(a)-(e) of the Second Amended Complaint.
Respondents' current solicitation, like its previous solicitation, is in postcard form and is seeking orders for a "35 mm Quickshot Camera." The current solicitation is also similar to the previous solicitation in that it allegedly makes the representation discussed in paragraph 9(d) of the Second Amended Complaint and prohibited by paragraph 3(d) of the previously- issued Cease and Desist Order. However, Complainant argues in its Petition that the current solicitation differs from the previous solicitation in that it contains the following new false representations:
"(a) the recipient of respondents' mailing is entitled to receive the camera based on the results of a contest, sweepstakes or drawing;
(b) the camera is of comparable value to other merchandise listed on the mailing;
(c) the payment required to receive the camera is for incidental costs of transporting the product to the recipient;
(d) the camera has been set aside specifically for the recipient; and
(e) the mailing is something other than an offer to sell the camera."
The current solicitation is also different in that it is not alleged to make the false representations set forth in paragraph 9(a), (b), (c) and (e) of the Second Amended Complaint and prohibited by paragraph 3(a), (b), (c) and (e) of the Cease and Desist Order.
The issue to be decided in connection with a Petition for Supplemental Orders is whether a person is evading or attempting to evade the provisions of a previously-issued False Representation Order or Cease and Desist Order by conducting the same or a similar enterprise under a different name or at a different address. See Scott David Wilcox d/b/a Telco Directories, Inc., P.S. Docket No. 18/147 (P.S.D. Apr. 20, 1988); Karfax and Karfax Industries, P.S. Docket No. 7/36 (P.S.D. Mar. 26, 1981); 39 C.F.R. § 952.30. In the present proceeding, the same Respondents are using a combination of a name and address 1/ which, although included in the caption of this proceeding, differs from the name and address against which False Representation Order No. 89-17 was issued. Thus, the require- ment that the same party be using a different name or address is present in this proceeding.
In order to determine whether Respondents are conducting "the same or a similar enterprise" as required by the Rules of Practice, the current solicitation, representations and product must be compared with those which were the subject of the Cease and Desist and False Representation Orders. See Karfax and Karfax Industries, supra; 39 C.F.R. § 952.30. Such a comparison reveals that the same product is advertised in both the previous and current solicitations and one representation is alleged to be common to both. 2/ However, most of the alleged false representations included in the current solicitation differ substantially from the representations which were the subject of the Second Amended Complaint. As Complainant concedes in its Petition, in order to support the issuance of a Supplemental Order, the one representation alleged to be included in both the previous and current solicitations must be considered with the newly alleged false representations and in the context of the overall impression created by the language of the current solicitation. See Donaldson v. Read Magazine, Inc., 333 U.S. 178 (1948); Associated Telephone Directory Publishers, Inc., P.S. Docket No. 13/191 (P.S.D. Jan. 25, 1984). Such an analysis requires a determination of the falsity of the newly alleged false representations which should more appropriately be undertaken in a newly initiated proceeding pursuant to 39 U.S.C. § 952.5.
Accordingly, the Petition for Supplemental Orders is denied without prejudice to refiling of a new Complaint under 39 C.F.R. Part 952.
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