In the Matter of the Complaint ) June 28, 1994 Against ) ) DISCOVERY EXPERIMENTAL & ) DEVELOPMENT, INC. ) MEXICO N.A., et al. ) c/o B & B Freight Forwarding, Inc. ) P. O. Box 7178 ) ) at ) ) Wesley Chapel, FL 33543-7178, etc. ) P. S. Docket No. 40/147 APPEARANCES FOR COMPLAINANT: Wendy A.Hocking, Esq. Alan B. Ostroff, Esq. Consumer Protection Law United States Postal Service Washington, DC 20260-1147 APPEARANCE FOR RESPONDENTS: James T. Kimball 29949 S.R. 54 West Wesley Chapel, FL 33543-4509
Respondents Discovery Distributing, Inc., Discovery Experimental and Development, Inc., B & B Freight Forwarding Service, Inc., and James T. Kimball (hereafter Respondents) have filed a motion to modify or revoke Cease and Desist Order No. CD-3676, or in the alternative, to enforce the terms of the Settlement Agreement (hereinafter Agreement) executed by the parties on August 11, 1993. Respondents contend the Cease and Desist Order should be modified or revoked because Complainant, United States Postal Service, has failed to comply with the terms of the Agreement in which Respondents agreed the Order could be issued. According to Respondents, Complainant has (1) held mail to an address which was not referred to in the Agreement; (2) returned mail that Respondents were entitled to receive; (3) opened and delayed delivery of mail to Respondents; (4) diverted registered mail sent by Respondents; and (5) continually and repeatedly diverted, destroyed or delayed mail sent to or by Respondents.
Complainant opposes Respondents' motion. Although Complainant concedes there may have been some mishandling of Respondents' mail, it contends any such mishandling was unintentional and inadvertent and that it has at all time attempted in good faith to fulfill whatever obligations it has under the terms of the Agreement.
On May 12, 1993, Complainant initiated this proceeding by filing a Complaint which, as subsequently amended, alleged that Respondents were engaged in a scheme or device for obtaining money through the mail by means of materially false representations in violation of 39 U.S.C. §3005. Thereafter, the parties entered into the Agreement which provided that in consideration for Complainant's agreement to file a motion to suspend further proceedings against Respondents, Respondents would permanently discontinue using certain advertising materials and not resume using those materials under any name or names or through any corporate or other device. Respondents, in addition, agreed and consented that mail addressed to Respondents in various ways would be handled as specified in the Agreement. Upon execution of the Agreement, Complainant filed a motion to suspend further proceedings against Respondents, the proceedings were suspended and Cease and Desist Order No. CD-3676 was issued.
Respondents contend that Complainant has mishandled mail covered by the terms of the Agreement as well as other mail addressed to, or originated by, Respondents and such mishandling is a breach of the terms of the Agreement. Complainant admits some confusion in handling Respondents' mail, but denies that it is guilty of any intentional misconduct or that any other grounds exist for Respondents to obtain the relief they are seeking.
Under the terms of the Agreement executed by the parties, remedial action may be taken only against Respondents. The Agreement neither contemplates a violation by Complainant nor authorizes a remedy in the event it could be concluded that a violation by Complainant has occurred. The principal purpose of the Agreement is to protect the public by obtaining an agreement from Respondents to discontinue the promotion which is the subject of the Complaint. The consideration for Respondents entering into the Agreement, and Complainant's primary obligation under the terms of the Agreement, is its offer to move to suspend further proceedings against Respondents, which Complainant in fact did. Thus, there is no basis for issuing the Order sought by Respondents under the terms of the Agreement.
Even if the Agreement provided for remedial action against Complainant, Respondents have not shown that Complainant has materially breached any obligation it may have under the terms of the Agreement. At most, the record reflects that the Postal Service, acting in its sovereign capacity as a universal mail service, may have inadvertently mishandled Respondents' mail, but not that Complainant as a party to the Agreement has intentionally, or even inadvertently, failed to comply with the terms of the Agreement. Moreover, Respondents themselves may have contributed to some of the confusion concerning the handling of their mail because they did not exercise their right to inspect the mail being held pursuant to a preliminary injunction and they allowed one of their post office boxes to be closed for nonpayment of rent. Further, allegations pertaining to the mishandling of mail to addresses which are not covered by the Agreement, or mail originated by Respondents, cannot serve as a basis for finding that the Agreement has been breached since Complainant had no responsibility for either under the terms of the Agreement.
There is also no basis for Respondents' alternative request that an Order be issued to enforce the terms of the Agreement. Corrective action has been taken by the Postal Service and whatever improprieties may have occurred in the handling of Respondents' mail are no longer occurring. Moreover, the purpose of the Agreement is being achieved by continuing the cease and desist order in full force and effect in its present form.
Respondents have not established that Cease and Desist Order No. CD-3676 should be modified or revoked or that any other relief should be ordered. Accordingly, Respondents' Motion is denied.
James A. Cohen Judicial Officer