In the Matter of the Complaint Against ) August 4, 1994 ) ERICA LYNN KORTJE ) d/b/a ) EMPLOYMENT CLASSIFIEDS ) 3337 South Bristol, Suite 146 ) at ) Santa Ana, CA 92704-7245 ) P.S. Docket No. 40/176 APPEARANCE FOR COMPLAINANT: Rodney Gould, Esq. United States Postal Service Consumer Protection Law 475 L'Enfant Plaza, SW Washington, DC 20260-1147 Betty A. Garner, Esq. United States Postal Service 281 E. Colorado Boulevard Pasadena, CA 91102-2000 APPEARANCE FOR RESPONDENT: Robert C. Moest, Esq. Stanley Fleishman, Esq. Fleishman, Fisher & Moest 2049 Century Park East, Ste. 3160 Los Angeles, CA 90067-3275
This proceeding was initiated on August 4, 1993, when the General Counsel for the United States Postal Service filed a Complaint alleging that Erica Lynn Kortje d/b/a Employment Classifieds ("Respondent") violated 39 U.S.C. §3005 by engaging in a scheme or device for obtaining money or property through the mail by means of false representations.(1) Specifically, paragraph 4(a)-(c) of the Complaint alleges that through unsolicited mailings to businesses and organizations Respondent makes the following representations, and that these representations are false and material as a matter of fact:
(a) the form sent to the recipient is a bill for prior publication of the recipient's advertisement;
(b) the amount printed on the face of the invoice is due and owing for the publication of the advertisement;
(c) the advertiser has previously authorized Respondent to print an advertisement.
The Complaint further alleges that Respondent's mailings are solicitations for the purchase of a service which are in the form of and reasonably may be construed as bills, invoices or statements of accounts due, and that Respondent's solicitations fail to meet the notice requirements of 39 U.S.C. §3001(d)(2) and the implementing regulations of Domestic Mail Manual §C031.(3) Accordingly, the Complaint alleges that Respondent's solicitations are nonmailable and constitute prima facie evidence of a violation of 39 U.S.C. §3005.
In timely filed Answers, Respondent denied making the false representations alleged in the Complaint or otherwise violating 39 U.S.C. §3005 or §3001(d). Respondent also asserted several affirmative defenses.
A hearing was held in this matter on October 29, 1993, in Los Angeles, California. Respondent did not appear personally, but was represented by counsel at the hearing. Both parties were afforded full opportunity to be heard, to adduce relevant evidence, and to examine and cross-examine witnesses. Complainant offered documentary evidence as well as the testimony of Postal Inspector Edward Lawee, two consumer witnesses--Shirley Daniel and Beverly Cameron--and expert witness Dr. Jerry Sebag, an ophthalmologist. Respondent offered no testimony or documentary evidence.
On or before January 11, 1994, both parties filed proposed findings of fact and conclusions of law and Respondent filed a brief, all of which have duly been considered. To the extent indicated below, proposed findings and conclusions have been adopted; otherwise, they have been rejected as irrelevant or contrary to the evidence. The findings of fact and conclusions of law set forth below are based on the entire record herein, including observation of the witnesses and their demeanor, the exhibits and other relevant evidence adduced at the hearing, and the brief for Respondent.
1. Erica Lynn Kortje does business as, and controls and directs the operations of, Employment Classifieds (CX12, p. 2-3 ). Through solicitations similar to the one attached to the Complaint, Respondent receives mail at 3337 South Bristol, Suite 146, Santa Ana, California 92704, addressed to "Attn: Accounts Receivable, Employment Classifieds" (CX12, p. 2, CX-1).
2. Employment Classifieds is Respondent's free publication, the first copy of which was dated July 15-July 31, 1993 (Tr. 20, 36 ).(4) This copy of Employment Classifieds has the format of a newspaper but primarily consists of advertisements for job openings in various parts of the country (CX 3).
3. Respondent sends solicitations for orders for advertising services through the mails to businesses and organizations that have recently printed an advertisement for a job opening in a publication other than Employment Classifieds (Tr.46, 68).
4. Respondent's solicitation consists of a single page form with printing on the front and back. Respondent uses essentially the same form for all of its solicitations. (Complaint, Exhibit 1 a-b, Appendix ("App.") 1 A-B, CX 4-7, 9, 10.)(5) Respondent's solicitations have a type of layout that is commonly found on bills or invoices. Thus, for example, a portion of Respondent's solicitation is designed to be detached along a dotted line and contains the direction "DETACH & RETURN" with your "PAYMENT" or "CHECK". (App. 1-A, Complaint, Exhibit 1a.)
5. The face of Respondent's solicitation is replete with terminology that is characteristic of a bill or invoice. The most prominent printing on the face of Respondent's solicitation is the phrase "MAKE CHECK PAYABLE & REMIT TO:" which is printed in red, all capital letters, at the top left-hand side of the form. Immediately below this red printing is Respondent's name and mailing address, as set forth above in 1. (App. 1-A.)
6. Typically, at the top right-hand side of Respondent's solicitations are the words "PAY BEFORE" followed by a specific date, all of which is enclosed in a box.(6) Below this box is a series of smaller boxes giving the date of the solicitation, an actual "customer number", an actual "account number", and a blank box headed "amount paid". In a substantially larger box are the words "PAY THIS AMOUNT" printed in white type, about 3/4 inch high, on a dark blue background, next to which is a dollar figure. (App. 1-A.) Another series of boxes repeats the date of the solicitation, account number, and customer number, and adds a box labeled "terms" which states "pay net 10 days" or "pay upon receipt" (App. 1-A, Complaint, Exhibit 1a).(7)
7. Further indicative of a bill is the middle portion of Respondent's solicitation which is captioned, "CLASSIFIED EMPLOYMENT ADVERTISING". The large type below that caption shows "YOUR ADVERTISEMENT AS LISTED ON:" followed by some specific past date. This wording is followed by a quote from a classified advertisement for help wanted which the recipient has already had printed in some publication other than Employment Classifieds. In the lower right-hand corner of the middle portion of the solicitation is the word "AMOUNT", which stands out because it is printed in a box format in large, white type against a dark blue background, with an arrow pointing to a dollar figure next to it. (App. 1-A.)
8. The most prominent feature in the lower portion of Respondent's solicitation is a dark blue box with white lettering which states "MAKE CHECK PAYABLE TO:" next to which the name and mailing address of Employment Classifieds is repeated. (App. 1-A.)
9. I find from the above observations, which are based on Respondent's solicitations themselves, that they are "in the form of, and reasonably could be interpreted or construed as, a bill, invoice, or statement of account due". 39 U.S.C. §3001(d)(1).
10. This finding is supported by the testimony of Complainant's consumer witnesses. Both Shirley Daniel and Beverly Cameron credibly testified that they received copies of Respondent's solicitation addressed to the business or organization for which they work and that they believed Respondent's solicitation was a bill for a help wanted advertisement their employer or organization had previously placed in a local newspaper (Tr. 44-47, 66-70, CX9-10 ).
11. In addition to the above wording indicative of a bill or invoice, the Respondent's solicitation contains certain explanations and disclaimers. On the face of the solicitation, in letters about 3/4 inch high, is the following notice: "THIS IS NOT A BILL THIS IS A SOLICITATION. YOU ARE UNDER NO OBLIGATION TO PAY THE AMOUNT STATED ABOVE UNLESS YOU ACCEPT THIS OFFER." (App. 1-A).(8)
12. The above disclaimer is barely readable for the following reasons. As shown by looking at the originals of Respondent's solicitations, this disclaimer is printed in a light yellow color on a light blue background. I find from my own observation of the originals of Respondent's solicitations in evidence in this case that the effect of the yellow printing on the light blue background is that the print blends into the background, making it difficult to even recognize that the printing is there. Adding to the difficulty in reading Respondent's disclaimer is the fact that the printing is so closely spaced that the letters tend to blur into one another.
13. The above finding is supported by the testimony of Complainant's two consumer witnesses, both of whom stated that they did not see this disclaimer when they read Respondent's solicitation (Tr. 55-56, 73-74, CX-9, 10).
14. The finding is further supported by the testimony of Complainant's expert witness, Dr. Jerry Sebag, an ophthalmologist. After being handed the originals of two of Respondent's solicitations (CX- 4, 5), Dr. Sebag testified as follows (Tr. 87, 89-90):
The reason that it is difficult to see yellow print on a blue background, . . . is that the lettering and the background come into focus at different plains (sic.) within the eye. . . . So that colored light of short wave lengths such as blue or green, come into focus in front of the retina. Whereas, colored lights such [as] yellow or red come into focus behind the retina. And, consequently, when placing either red and green or blue and yellow in opposition, the edge is extremely difficult to see.
So that the blue background on these two documents focuses in front of the retina. The yellow . . . letters on these two documents focuses behind the retina making it extremely difficult for the eye to discern the edge between, which is the necessary phenomenon that has to occur for the visual perception of the letter to occur. . . . There is a particular terms (sic.) that applies to the phenomenon that I just described. Yellow and blue would be one example of the phenomenon and the term is chromatic aberration. . . .
Dr. Sebag is a well qualified ophthalmologist. See CX-11. I find that his testimony is highly reliable. I also note that Respondent failed to controvert any of the expert's testimony on cross-examination or to offer any rebuttal evidence. I therefore credit Dr. Sebag's testimony and rely on it to the extent that it supports my observations concerning the difficulty in reading Respondent's disclaimer.
15. Also on the face of some of Respondent's solicitations is the following text: "This is an order form for placement. This advertisement has been placed in another publication. It has not yet appeared in the employment classifieds. The advertisement will appear in the next edition uppon (sic.) receipt of your payment" (App. 1-A). On other solicitations a slightly different text is used: "This is a classified order form with regard to copy, size, and dollar amount. If the terms are acceptable, please remit your check with
[detachable] portion" (Complaint, Exhibit 1a, CX5, p. 2). Both versions of this text are printed in extremely small type and placed directly under the caption "CLASSIFIED EMPLOYMENT ADVERTISING" which is printed in large type (App. 1-A ). The juxtaposition of the small type under the larger print makes it easy to overlook the explanatory text. The first version quoted is particularly difficult to read because the words of the explanation are so tightly spaced together that it takes concentration to read them at all (App. 1-A).
16. Similarly, the face of Respondent's solicitation contains the warning "Important information on reverse" in the lower left-hand corner of the middle section, printed in type that is dwarfed by the large, dark blue box to the right stating "AMOUNT", with an arrow pointing to a dollar figure. Although this warning is not printed in the extremely small, cramped style used in the explanatory text discussed above in 15, the reader's attention is still drawn to the larger, more prominent type to the right because of the eye-catching arrow and dark blue background color. (App. 1-A.)
17. The reverse side of Respondent's solicitation contains a number of warnings and disclaimers, including the disclaimer prescribed in the DMM. The text on the back of the solicitation is printed in a light blue color on a white background (App.1-B). Although the minimal color contrast gives the printing on the back an indistinct quality, the text can be read without much difficulty. The text printed on the back of Respondent's solicitations is shown in full in the appendix. (App. 1-B.)
18. The Complaint alleges, and I find, as a fact, that Respondent, through its solicitations, either directly or indirectly, in substance and effect, whether by affirmative statements, implications or omissions makes the following representations and that they are both false and material.
19. The form sent to the recipient is a bill for prior publication of the recipient's advertisement.
Respondent's solicitation gives the impression to the average recipient that it is a bill for prior publication of recipient's job advertisement. The solicitation shows on its face an excerpt from a classified advertisement for a job opening at the recipient's business or organization that has already been printed in a publication other than Employment Classifieds. The solicitation states "YOUR ADVERTISEMENT AS LISTED ON:" and gives a prior date
(App.1-A). The effect of this statement and excerpt, coupled with the numerous references to "amount", "pay", and "payable" is to create the impression that the solicitation is in fact a bill for the classified advertisement the recipient has already placed in another publication. This finding is supported by the credible testimony of Complainant's two consumer witnesses, both of whom stated that they believed Respondent's solicitation was a bill for the authorized, prior printing of a help wanted advertisement in a publication other than Employment Classifieds (Tr. 45-47, 68-69).
20. The above representation is false because Respondent has not previously printed the advertisement quoted in the solicitation, nor is Respondent the agent for the publication in which the advertisement was actually printed.
21. The amount printed on the face of the invoice is due and owing for the publication of the advertisement.
The most prominent words on the face of Respondent's solicitation are "MAKE CHECKS PAYABLE & REMIT TO:" which is printed in vivid red letters at the top left-hand side of the form. The next most prominent part of the solicitation are the words "PAY THIS AMOUNT", "AMOUNT" and "MAKE CHECK PAYABLE TO:". These words are printed in large type, in white ink, on a dark blue background. Next to the words "AMOUNT" and "PAY THIS AMOUNT" is a specific dollar figure. (App. 1-A.) The overall effect of these words and the prominence they are given on the solicitation is to create the impression that the recipient owes the dollar amount stated, for publication of the quoted advertisement. This impression is reinforced by the use of the words "terms" and "pay net 10 days" or "pay upon receipt" on the face of the solicitation (App. 1-A, Complaint, Exhibit 1a). Further, the recipient is instructed on the face of the solicitation to remit payments to " Attn: Accounts Receivable" (App.1-A). Webster's Dictionary defines accounts receivable as "a balance due from a debtor on a current account." Webster's Ninth New Collegiate Dictionary (Merriam-Webster, Inc., 1986). The use of the term "accounts receivable" therefore suggests to the reader that the dollar amount shown on the face of the form is already due and owing to Employment Classifieds for services rendered. This finding is supported by the credible testimony of Complainant's two consumer witnesses, both of whom testified that after reading Respondent's solicitation they believed that the amount stated on the form was due and owing for placement of a help wanted advertisement that actually had been printed in another publication (Tr. 59-60, 72).
22. The above representation is false because recipients of the solicitation do not owe any money to Employment Classifieds when the solicitation is originally mailed out.
23. The advertiser has previously authorized Respondent to print an advertisement.
As shown above, Respondent's solicitation states "Your advertisement as listed on:" followed by a date prior to that of the solicitation. This text is followed by a quotation from an actual advertisement that the recipient has already placed in another publication. The words and the quotation on the solicitation imply that the recipient has already authorized Employment Classifieds to print the advertisement quoted and that the advertisement has been published as agreed. The use of a customer number and account number on the face of Respondent's solicitation also lead the reader to believe that the recipient had an established business relationship with Employment Classifieds and that the solicitation is a bill for services rendered pursuant to a prior agreement. This finding is supported by the credible testimony of Complainant's two consumer witnesses, both of whom testified that the words "customer number" and "account number" gave them the impression that Respondent's solicitation was a bill for an advertisement that had been authorized for printing in another publication (Tr. 49-50, 70-71).
24. The above representation is false because the recipient has not previously authorized Respondent to print an advertisement.
25. All three of the false representations discussed above are material because they are likely to induce the recipients to take some action that they otherwise would not have taken, i.e., send money to Respondent. This finding is supported by the credible testimony of Complainant's two consumer witnesses. Both witnesses testified that they would not have paid or approved payment based on Respondent's mailing, if they had realized that it was a solicitation from Employment Classifieds and not a bill from the publication that previously had been authorized to print their advertisements (Tr. 52-53, 79).
1. Respondent contends (Answer ("Ans.") 1-3, Brief ("Br.") 1-2 ) that its solicitation complies with the requirements of 39 U.S.C. §3001(d)(2)(A) and DMM §C031.1.2. Contrary to Respondent's contention, its solicitation does not conform to the requirements of the statute or the regulations.
2. As shown above in 11 and n. 8, the disclaimer language specified in DMM §C031.1.2 is, in fact, printed on the face of Respondent's solicitation. However, this disclaimer is printed in a light yellow color against a light blue background, and the regulation specifically requires that the disclaimer be printed in "a color prominently contrasting with the background against which it appears". DMM §C031.1.2.(9) The term "color prominently contrasting" is further defined in the regulations as excluding any color "which is not at least as vivid as any other color on the face of the solicitation". DMM §C031.1.6.(10) The most vivid color on the face of Respondent's solicitation is the red printing in the upper left-hand corner which reads "MAKE CHECK PAYABLE & REMIT TO:". The light yellow print Respondent uses for its regulatory disclaimer language is significantly less vivid than the red color used for this check writing instruction. Furthermore, as noted above in n. 8, some of Respondent's solicitations, even if they were readable, contain an incomplete version of the disclaimer required under the regulations.
3. Respondent's reliance (Br. 1) on the language in its solicitation quoted in 15 above, explaining that Respondent's mailing is actually an order form and not a bill, is without merit. As found in that same paragraph, the explanatory language is printed in such a manner that it is easy to overlook. It is well established that an inconspicuous disclaimer is insufficient to dispel the effects of false representations. Gottlieb v. Schaffer, 141 F.Supp. 7, 17 (S.D.N.Y. 1956); Leo Daboub, P.S. Docket No. 19/185, slip op. at 16 (P.S.D. July 10, 1986).
4. Respondent also relies (Br. 1) upon the text printed on the back of its solicitation to support its position that it is in compliance with the statute and the regulations. Respondent is foreclosed from relying upon the text on the back of its solicitation because both the statute and the regulations specifically require that the disclaimer be printed on the face of the solicitation. 39 U.S.C. §3001(d)(2), DMM §C031.1.2.(11) The requirement that the disclaimer be printed on the face of the form is reasonable since recipients of bills tend to pay little or no attention to the back of the bill. See Tr. 56, 74.
5. Even assuming that Respondent's disclaimers met the requirements of DMM §C031.1.2, the regulations provide that such compliance "does not avoid violation of 39 U.S.C. §3005 if any part of the solicitation . . . misrepresents a material fact to the addressee". DMM §C031.1.1.(12) As shown above in the Findings Of Fact, Section D, Respondent's solicitations contain at least three misrepresentations of material facts.
6. Respondent further contends (Ans. 3, Br. 3-7) that its solicitation is commercial speech protected by the First Amendment. Contrary to Respondent's contention, its solicitation is not protected speech. As shown in Section D of the Findings Of Fact, Respondent's solicitations contain a number of false representations. It is well established that in order to be protected by the First Amendment, commercial speech must not be false. See, for example, Virginia State Board of Pharmacy v. Virginia Citizens Consumer Council, 425 U.S. 748, 771 (1980) ("Untruthful speech, commercial or otherwise has never been protected for its own sake"); Central Hudson Gas & Electric Corp. v. Public Service Comm'n., 447 U.S. 557, 566 (1980). (The first prong of the four part test to determine whether commercial speech is protected under the First Amendment requires that the commercial speech must not be misleading.)
7. Respondent also contends (Br. 7-11) that its solicitation is lawful because it adequately informs the recipient of the relevant facts. Respondent bases this contention on a number of cases involving the adequacy of warnings of financial risk printed in stock prospectuses. The cases relied on by Respondent are irrelevant to the instant litigation. Whatever language may or may not be adequate warning in a stock prospectus, the statute and regulations concerning the mailability of solicitations in the guise of invoices require specific language that must be printed in a specific manner. As shown above, Respondent's solicitation fails to meet these statutory and regulatory requirements.
Respondent also fails to cite any authority indicating that the cases cited concerning the "bespeaks caution" doctrine are applicable to solicitations in the form of invoices. The reader of a stock prospectus or purchaser of a truck may be held to a higher standard of prudence because they are prospective buyers who, as such, should necessarily be alert for disclaimers concerning the goods to be purchased. The reader of Respondent's solicitation, however, can reasonably be expected to give the document only a cursory reading, focusing on the amount owed, because the form appears to be a bill for services already rendered.
1. It is established that Respondent's solicitations must be considered as a whole and their meaning determined in the light of the probable impact of this material on ordinary minds. Donaldson v. Read Magazine, 333 U.S. 178, 188 (1948) and cases cited; Peak Laboratories, Inc. v. U.S. Postal Service, 556 F.2d 1387, 1389 (5th Cir. 1977); Charles Smith, P.S. Docket No. 36/129, slip op. at 7 (P.S.D. December 9, 1993) and cases cited.
2. 39 U.S.C. §3005 is intended to protect not only the sophisticated and wary reader but also the gullible, naive and less critical reader. Fields v. Hannegan, 162 F.2d 17, 18 (D.C. Cir.), cert. denied, 332 U.S. 773 (1947); M.K.S. Enterprises, Inc. v. USPS, 459 F.Supp. 1180, 1184 (E.D.N.Y. 1978); Gottlieb v. Schaffer, 141 F.Supp. 7, 16 S.D.N.Y. 1956); Leo Daboub, P.S. Docket No. 19/185, slip op. at 9 (P.S.D. July 10, 1986). "People have a right to assume that fraudulent advertising traps will not be laid to ensnare them." Donaldson v. Read Magazine, 333 U.S. 178, 189 (1948).
3. The Administrative Law Judge may determine from the solicitations themselves whether the false representations alleged in the Complaint are made, their effect on the ordinary mind and whether the representations were material. A.C.L., P.S. Docket No. 36/90, slip op. at 12 (P.S.D. December 28, 1990); Health Care Products, Inc., P.S. Docket No. 28/90, slip op. at 4-5 (P.S.D. June 27, 1990); United States Testing Authority, P.S. Docket Nos. 14/77, 14/114, slip op. at 15-16 (P.S.D. October 2, 1985) and cases cited.
4. Indeed, the solicitations themselves are the most persuasive evidence of whether the representations are in fact made. Washington Mint, Inc., P.S. Docket No. 30/43, slip op. at 7 (P.S.D. Nov. 27, 1992); Scott David Wilcox, P.S. Docket No. 18/147, slip op. at 6-7 (P.S.D. April 20, 1988). Similarly, the solicitations themselves are the best evidence concerning whether the solicitation has the appearance of an invoice or bill. Charles Smith, P.S. Docket No. 36/129, slip op. at 15 (I.D. March 27, 1991); Associated Telephone Directory Publishers, Inc., P.S. Docket No. 13/191, slip op. at 6 (P.S.D. January 25, 1984); Telex & twx Directory, P.S. Docket No. 13/6, slip op. at 9 (P.S.D. April 1, 1983).
5. Solicitations which are ambiguous or capable of more than one meaning are misleading if one of those meanings is false. Finderhood Inc., P.S. Docket No. 34/102, slip op. at 8-9 (P.S.D. March 20, 1992) and cases cited; The National Gold Mint, P.S. Docket No. 22/165, slip op. at 22 (P.S.D. May 1, 1987).
6. "Advertisements as a whole may be completely misleading although every sentence separately considered is literally true. This may be because things are omitted that should be said, or because advertisements are composed or purposefully printed in such way as to mislead." Donaldson v. Read Magazine, 333 U.S. 178, 188 (1948) and cases cited.
7. Representations are considered to be material if they are likely to induce the recipients to take some action they otherwise would not have taken. First National City Funding, Inc., P.S. Docket No. 17/61, slip op. at 34 (I.D. December 9, 1983); Keystone Industries, et al., P.S. Docket Nos. 17/44-46, slip op. at 13 (I.D. November 7, 1983); The Columbia Mint, P.S. Docket Nos. 15/98-99, slip op. at 39-40 (I.D. May 27, 1983).
8. Applying the foregoing standards, I find that Respondent's solicitations make the representations alleged in 4 (a)-(c) of the Complaint. The language contained in the solicitations which directly or impliedly makes these representations is set forth in Section D of the Findings Of Fact.
9. As further set forth in Section D of the Findings Of Fact, the representations specified in 4 (a)-(c) of the Complaint are false.
10. The false representations made by Respondent are material for the reasons stated in Section D of the Findings Of Fact.
11. A solicitation is "nonmailable" if it "is in the form of, and reasonably could be interpreted or construed as, a bill, invoice, or statement of account due", unless it contains the disclaimer prescribed by the statute or the DMM. As set forth in the Findings Of Fact, Respondent's solicitation has the appearance of an invoice or bill.
12. Respondent's solicitation in the form of a bill or invoice fails to meet the disclaimer requirements of 39 U.S.C. §3001(d) or DMM §C031 and it is therefore nonmailable. Respondent's failure to comply with the statutory or DMM requirements for solicitations in the form of invoices or bills constitutes prima facie evidence that Respondent violated 39 U.S.C. §3005.
13. Respondent is engaged in the conduct of a scheme for obtaining remittances of money through the mail by means of material false representations in violation of 39 U.S.C. §3005.
14. Respondent's affirmative defenses are without merit and are rejected.
15. The attached False Representation Order and Cease and Desist Order should be issued.
Judith A. Dowd Acting Chief Administrative Law Judge
(a) Upon evidence satisfactory to the Postal Service that any person is engaged in conducting a scheme or device for obtaining money or property through the mail by means of false representations, including the mailing of matter which is nonmailable under section 3001(d) of this title, . . . the Postal Service may issue an [appropriate] order . . . . For purposes of the preceding sentence, the mailing of matter which is nonmailable under such section 3001(d) by any person shall constitute prima facie evidence that such person is engaged in conducting a scheme or device for obtaining money or property through the mail by false representations.
2. 39 U.S.C. §3001(d) provides as follows:
Matter otherwise legally acceptable in the mails which--
(1) is in the form of, and reasonably could be interpreted or construed as, a bill, invoice, or statement of account due; but
(2) constitutes, in fact, a solicitation for the order by the addressee of goods or services, or both;
is nonmailable matter, shall not be carried or delivered by mail, and shall be disposed of as the Postal Service directs, unless such matter bears on its face, in conspicuous and legible type in contrast by typography, layout, or color with other printing on its face, in accordance with regulations which the postal Service shall prescribe--
(A) the following notice: "This is a solicitation for the order of goods or services, or both, and not a bill, invoice, or statement of account due. You are under no obligation to make any payments on account of this offer unless you accept this offer."; or
(B) in lieu thereof, a notice to the same effect in words which the Postal Service may prescribe.
3. DMM §C031.1.1 provides, in general:
General. Any otherwise mailable matter that reasonably could be considered a bill, invoice, or statement of account due, but is in fact a solicitation for an order, is nonmailable unless it conforms to C031.1.2 through C031.1.7. A nonconforming solicitation constitutes prima facie evidence of violation of 39 USC 3005. However, compliance with this section does not avoid violation of Section 3005 if any part of the solicitation or any information with it misrepresents a material fact to the addressee . . . .
4. Respondent sent out solicitations as early as February 1, 1993, five months prior to the date of the first issue of Employment Classifieds. See Complaint, Exhibits 1a, 2.
5. Appendix 1A-B, attached to this Initial Decision, consists of a copy of the front and back of a typical solicitation used by Respondent. This solicitation was admitted into evidence at the hearing and marked as CX 6, p. 2. To avoid needless repetition of multiple citations, I will generally cite only to the solicitation that is appended to this Initial Decision from this point forward, since the other solicitations in the record in this case are substantially identical forms, except for some minor differences in wording and layout. Those differences will be described where relevant.
6. The solicitation attached to the Complaint has the words "Pay Promptly" stamped on its face and it does not contain the "Pay Before" provision described above (Complaint, Exhibit 1a).
7. The solicitation attached to the Complaint utilizes a box format and includes most of words and phrases noted above, but the boxes and accompanying text are located in different places on the form (Complaint, Exhibit 1a).
8. This notice tracks the language of the disclaimer required under DMM §C031.1.2, which provides, in pertinent part, as follows:
Required Disclaimer. The solicitation must bear on its face the disclaimer prescribed by 39 USC 3001(d)(2)(A) or the notice: THIS IS NOT A BILL. THIS IS A SOLICITATION. YOU ARE UNDER NO OBLIGATION TO PAY THE AMOUNT STATED ABOVE UNLESS YOU ACCEPT THIS OFFER. The statutory disclaimer or the alternative notice must be displayed in conspicuous boldface capital letters of a color prominently contrasting with the background against which it appears, including all other print on the face of the solicitation and that are at least as large, bold, and conspicuous as any other print on the face of the solicitation. . . .
It should be noted that some of Respondent's solicitations contain an incomplete version of the disclaimer required under the regulations, since the final two words--"this offer"--are missing. See, for example, CX 4, p. 1.
9. DMM §C031.1.2 is quoted above in n. 8
10. DMM §C031.1.6 provides, in pertinent part, as follows:
Definitions. For this standard, "color prominently contrasting" excludes any color, or any intensity of an otherwise included color that does not permit legible reproduction by ordinary office photocopying equipment used under normal operating conditions, and which is not at least as vivid as any other color on the face of the solicitation. . . .
11. Although Respondent's solicitation states on its face "Important information on reverse", this warning is insufficient to satisfy the requirements of the statute and the regulations. Both the statute and the regulations require that the disclaimer itself be printed on the face of the solicitation. 39 U.S.C. §3001(d)(2), DMM §C031.1.2. In any event, as found above in 16, this notice stating that there is important information on the reverse is quite inconspicuous and, as such, is insufficient to overcome the effects of Respondent's false representations. See, cases cited above in 3 of Respondent's Affirmative Defenses.
12. DMM §C031.1.1 is quoted above in n. 3.