In the Matter of the Complaint Against

FORT MORGAN VAPOR JET
15160 Highway 144, No. 7
at Fort Morgan, CO 80701

P.S. Docket No. 12/64

09/29/82

Cohen, James A.

APPEARANCE FOR COMPLAINANT:
Thomas A. Ziebarth, Esq.;
James A. Harbin, Esq.;
Consumer Protection Division,
Law Department,
United States Postal Service,
Washington, DC 20260

APPEARANCE FOR RESPONDENT:
Harlan G. Balaban, Esq.;
Balaban & Lutz, P.C.,
1624 Market Street, Suite 311,
Denver, CO 80202

POSTAL SERVICE DECISION

Respondent has appealed from the Initial Decision of an Administrative Law Judge which holds that, with regard to the advertising and sale of the product Vapor-Jet, Respondent is engaged in a scheme to obtain money or property through the mail by means of materially false representations in violation of 39 U.S.C. § 3005.

BACKGROUND

On September 10, 1981, the Consumer Protection Division, Law Department, United States Postal Service (Complainant) filed a Complaint alleging that Respondent was selling through the mail a retrofit device for automobiles marketed under the trade name Vapor-Jet, by means of false representations in violation of 39 U.S.C. § 3005. Specifically, Count 1, paragraph 3 of the Complaint alleges that Respondent falsely represents that:

"(a) the installation of a VAPOR JET on an average motor vehicle will cause a substantial increase in fuel economy (a mile per gallon improvement of 13.3% to 17.3%);

(b) the installation of a VAPOR JET on an average motor vehicle will improve combustion efficiency;

(c) the installation of a VAPOR JET on an average motor vehicle will increase engine horsepower;

(d) the installation of a VAPOR JET on an average automobile will increase octane ratings by allowing more fuel to be converted into power producing energy thereby causing regular gas to the operated 'premium' results;

(e) the fuel economy and engine performance improvement claims set forth in subparagraphs (a) through (d) are supported by competent scientific research and test results;

(f) the installation of VAPOR JET will dissolve carbon deposits on spark plugs and cylinder walls in older vehicles and prevent such build up on newer vehicles;

(g) the VAPOR JET is substantially similar to water injection devices used on combat aircraft in World War II to give increased speed and extended range; and

(h) a United States patent has been issued on the VAPOR JET as a fuel saving device."

In Count 2 of the Complaint it is alleged that Respondent supplies its dealers with sales literature through which the dealers "make the same false representations to their prospective customers as those enumerated in Count 1, paragraph 3, of this Complaint. . . . Respondent thereby knowingly seeks further remittances of money through the mail by means of false representations made by its dealers at its express direction." (Comp., paras. 9 & 10.)

In a timely filed Answer, Respondent admitted making the representations set forth in subparagraphs 3(b), (c), (d), (e), and (f) of the Complaint, but denied making those set forth in subparagraphs 3(a), (g) and (h). Respondent also denied that any of the representations set forth in paragraph 3 are materially false as a matter of fact. With respect to Count 2 of the Complaint, Respondent denied that its dealers make the false representations alleged in paragraph 3 through company-approved sales materials.

At a hearing before an Administrative Law Judge, Complainant presented the testimony of Merrill W. Korth, Device Evaluation Coordinator for the U.S. Environmental Protection Agency (EPA). Respondent presented the testimony of several witnesses, including that of William Guentzler, Ph.D., Director of Power Technology at San Diego State University. At the conclusion of Complainant's direct case, Respondent moved to dismiss the Complaint on the basis that Complainant had not established a prima facie case through its sole witness, Mr. Korth. The Administrative Law Judge denied the motion, finding that Complainant had made a prima facie case (Tr. 12r-131).

On March 26, 1982, the Administrative Law Judge issued an Initial Decision in which he reaffirmed the previous denial of Respondent's motion to dismiss and found that Respondent's advertising makes all of the representations set forth in paragraph 3 of the Complaint. He further found that the representations set forth in subparagraphs 3(a), (e), (f), (g) and (h) of the Complaint are materially false but that Complainant failed to prove that the representations set forth in subparagraphs 3(b), (c) and (d) are false. With respect to Count 2 of the Complaint, he found that persons electing to become Respondent's dealers were provided with material containing representations similar to those set forth in paragraph 3. However, the Initial Decision does not include a specific conclusion of law regarding the allegation in Count2, paragraph 10 of the Complaint that "Respondent thereby knowingly seeks further remittances of money through the mail by means of false representations made by its dealers at its express direction." Respondent appealed the Initial Decision to the Judicial Officer on May 3, 1982. Both parties filed written briefs.

RESPONDENT'S EXCEPTIONS TO THE INITIAL DECISION

Respondent has filed six exceptions to the Initial Decision which are discussed, in turn, below.

Exception 1

"THE ADMINISTRATIVE LAW JUDGE ERRED AND ABUSED HIS DISCRETION IN FAILING TO GRANT RESPONDENT'S MOTION TO DISMISS THE COMPLAINT UPON THE GROUNDS THAT THE COMPLAINANT FAILED TO SATISFY ITS BURDEN OF PROOF IN PRESENTING A PRIMA FACIE CASE."

Respondent makes several arguments under this exception. First, it argues that Complainant's sole witness, Merrill W. Korth, "was not sufficiently qualified as an expert . . . to substantiate the Complainant's allegations . . ." (Resp. Brief at 4).

Mr. Korth testified that: he is Device Evaluation Coordinator for the EPA (Tr. 13); since 1973; his work has concerned the testing of devices for automobile fuel economy (Tr. 15); he has been responsible for the testing of 30-40 retrofit devices for the purpose of determining fuel economy (Tr. 15, 18-19, 22), including five which are similar to the Vapor-Jet (Tr. 47); his responsibilities involved used as well as new cars (Tr. 23); and he has observed the performance of many automobile devices, including some similar to the Vapor-Jet (Tr. 21). This testimony was sufficient to qualify him as an expert witness for purposes of addressing the allegations set forth in the Complaint.

Respondent states that Mr. Korth admitted that at no time had he or anyone under his direction tested the Vapor-Jet (Resp. Brief at 4). The record supports Respondent's contention that Complainant's expert had not tested Respondent's product. While such testing would certainly have been desirable, it has been previously recognized that "expert opinion testimony need not be based on personal knowledge of a specific product and a prima facie case may be established on the basis of an expert's overall knowledge and his opinion as to the probability of something occurring or existing." Michigan Bulb Co., P.S. Docket No. 7/43 (P.S.D. Oct. 30, 1979, at 8). Mr. Korth therefore properly presented expert opinion testimony as to the effectiveness of the Vapor-Jet based on his overall knowledge and experience, despite the absence of direct testing.

Respondent also states that Mr. Korth "testified that at no time had he tested a device similar to that marketed by Respondent" (Resp. Brief at 4). However, as noted, Mr. Korth testified he had been responsible for testing similar devices and had observed their performance. Indeed, Respondent implicitly recognizes that EPA tested devices similar to the Vapor-Jet in its next argument that Mr. Korth "admitted that all similar devices tested produced positive results" (Id.). With regard to this argument, the portion of the transcript relied on by Respondent shows that while Mr. Korth did admit that the results of tests of similar devices were positive, he clearly stated that they were not significantly so (Tr. 109). More importantly, whether Respondent's product has a positive effect on fuel consumption is not at issue here. Rather, at issue is the truth of the specific representations contained in Respondent's advertisements as set forth in the Complaint.

Respondent further argues that "[t]he Complainant failed to establish that the testing procedures relied on by the Complainant were adequate or reasonable or determinative of the efficacy of any retrofit device, including that marketed by the Respondent" (Id.). The five EPA tests of similar devices on which Complainant relies (CX-7 through 11) are not free from question (see Tr. 92-98). However, the weight which should be given these tests is not determinative of whether Complainant made a prima facie case. In making this determination, all the evidence adduced by Complainant must be examined. This includes not only evidence relating to the five tests, but also Mr. Korth's general testimony, which showed an understanding of the principles underlying Respondent's device and therefore may be viewed, to a large extent, as based on knowledge and experience independent of these tests. Mr. Korth testified that, in his opinion: installation of the Vapor-Jet would not be expected to give a 13.3 to 17.3 percent improvement in fuel economy (Tr. 60); it would have a negligible improvement on combustion efficiency (Tr. 61) and would not increase engine horsepower (Tr. 61); it would not increase octane ratings by allowing more fuel to be converted to power producing energy, thereby causing regular gas to give premium results (Tr. 61); fuel economy and engine performance claims for the Vapor-Jet are not supported by competent scientific research and test results (Tr. 63-67); it would not dissolve carbon deposits in spark plugs and cylinder walls in older vehicles and prevent such buildup in newer vehicles because the amount of water being introduced is so small (Tr. 67); and the Vapor-Jet and the functions that it performs are not substantially similar to the water injection devices and the functions that they performed on airplanes in World War II (Tr. 69). He further testified that his opinions conform with the informed consensus of scientific opinion (Tr. 70). Based on this testimony, it is concluded that Complainant established a prima facie case which required Respondent to present its evidence.

Respondent next argues that "Complainant failed to establish that use of the Respondent's device would not dissolve carbon deposits and prevent the same from re-occurring" (Resp. Brief at 4). As noted, Mr. Korth testified that the Vapor-Jet would not dissolve carbon deposits in older vehicles and prevent buildup in newer vehicles. Under Rule 705 of the Federal Rules of Evidence, an "expert may testify in terms of opinion or inference and give his reasons therefor without prior disclosure of the underlying facts or data . . ." While, as discussed infra, it is concluded, based on a review of the entire record, that Complainant failed to sustain its burden on this specific charge, the Administrative Law Judge's ruling on the Motion to Dismiss was nonetheless proper with respect to this allegation since Mr. Korth's unrebutted opinion was sufficient to establish a prima facie case at the point in the proceeding at which Complainant rested.

Finally, Respondent argues that "Complainant introduced no evidence whatsoever in support of its contentions that the average American consumer would interpret Respondent's advertisements as claimed in the Complaint" (Resp. Brief at 4). Whether or not an advertisement makes alleged representations may be determined on the basis of the advertisement alone. Standard Research Laboratories, P.S. Docket No. 7/48 (P.S.D. April 4, 1980). Further, Respondent's Answer admitted making the representations alleged in subparagraphs 3(b), (c), (d), (e) and (f). Moreover, it is concluded that Respondent's advertisements make the representations alleged in subparagraphs 3(a), (g) and (h) of the Complaint for the reasons stated in the Initial Decision at 4-5. (Also, see infra.)

Accordingly, the Administrative Law Judge's denial of Respondent's Motion to Dismiss is affirmed.

Exception 2

"THE ADMINISTRATIVE LAW JUDGE ERRED AND ABUSED HIS DISCRETION IN FINDING THAT RESPONDENT'S ADVERTISEMENTS MAKE THE REPRESENTATIONS SET FORTH IN PARAGRAPH 3(a) OF COUNT I OF COMPLAINANT'S COMPLAINT, AND IN ENTERING HIS CONCLUSION OF LAW PURSUANT TO SUCH FINDING."

Respondent argues that the evidence was insufficient to support the Administrative Law Judge's finding that the representation set forth in subparagraph 3(a) of the Complaint was made. Respondent contends that "[t]he average American consumer would anticipate that, to market the subject device effectively, its designer and developer would advertise the same in its best light and promote its abilities to its best advantage . . . The average American consumer . . . has developed a degree of cynicism not credited by the Administrative Law Judge" (Resp. Brief at 6). Similarly, Respondent contends that "[t]he average American consumer is more than familiar with the testimonial - and - disclaimer advertising approach, and would easily recognize both such advertising method and Respondent's stated and implied message that his own benefits from the device will 'vary from car to car'" (Id.).

As Complainant correctly points out, the purpose of the Postal statutes is to protect all members of the public, both the wary and the gullible. N. Van Dyne Advertising Agency, Inc., v. United States Postal Service, 371 F.Supp. 1373, 1376 (S.D.N.Y. 1974); Gottlieb v. Schaffer, 141 F. Supp. 7, 16 (S.D.N.Y. 1956). Accordingly, in determining whether representations are false under 39 U.S.C. § 3005, they are to be interpreted according to their effect on the ordinary reader including both the way and the gullible. Oriental Nurseries, P.S. Docket No. 8/24 (P.S.D. March 31, 1981); All Products Unlimited, Inc., P.S. Docket No. 6/43 (P.S.D. March 29, 1978). Based on this standard, it is concluded that the advertisement, in its totality, represents that a substantial increase in fuel economy will be obtained by using the Vapor-Jet. Moreover, it has been recognized that a testimonial included in an advertisement can constitute a representation that users of the product will obtain similar results. Porter & Dietsch, Inc. v. FTC, 605 F.2d 294, 301, 303, 306 (7th Cir. 1979). With respect to the testimonial included in Respondent's advertisement that 13.3% to 17.3% mileage improvement was obtained with the Vapor-Jet which appears under the heading "[h]ow much mileage increase can be expected?" even Respondent's expert witness, Dr. Guentzler, a presumably "wary" individual, testified that in his opinion a lay person reading CX-1-a would assume that he would obtain "very close to" a 13.3% to 17.3% improvement in fuel consumption by using this device, despite the advertisement's caveat that results will vary (Tr. 328). Accordingly, the Administrative Law Judge's finding that Respondent makes the representation alleged in subparagraph 3(a) is affirmed.

Exception 3

"THE ADMINISTRATIVE LAW JUDGE ERRED AND ABUSED IS DISCRETION IN FINDING THAT RESPONDENT'S ADVERTISEMENTS MAKE THE REPRESENTATIONS SET FORTH IN PARAGRAPH 3(g) OF COUNT I OF COMPLAINANT'S COMPLAINT, AND IN ENTERING HIS CONCLUSION OF LAW PURSUANT TO SUCH FINDING."

Respondent argues that its reference to the principle employed in World War II combat-plane engines does not imply to the average American consumer that its actual device is or could be similar or substantially similar to the World War II device. According to Respondent, the very wording of CX-1-a that "'. . . extremely difficult installation required for earlier injectors combined to make them unattractive for automobiles and light trucks' informs the consumer that a notable degree of variance must exist between the actual devices installed in World War II combat planes and the device marketed by Respondent" (Resp. Brief at 8).

As Complainant's Brief points out, the excerpt from CX-1-a quoted by Respondent is highly selective. The complete sentence from which this excerpt is extracted states: "[h]however, up to now, the low price of gas and the high cost of and extremely difficult installation required for earlier injectors combined to make them unattractive for automobiles and light trucks." This language reasonably implies that the earlier installation difficulties had been overcome and that an injector system similar to that used in combat planes could be economically used in automobiles.

Respondent also argues that "the average American consumer has no knowledge whatsoever of the nature of water injectors developed during World War II, and is not likely to purchase Respondent's product as the result of any 'substantial similarity' thereto" (Resp. Brief at 8). In contrast to this assertion, Michael Polowchak, the owner of Fort Morgan Vapor Jet, implied that he himself was partially induced to respond to the advertisement for Vapor-Jet by the representation that water injection was successfully used on airplanes during World War II (Tr. 136).

Respondent further maintains that the record supports a comparison of the "principles and concepts" related to World War II combat plane injectors and the Vapor-Jet. However, William T. Trevaskis, the inventor of the Vapor-Jet, testified to a massive difference between the World War II water injection mechanism and the Vapor-Jet (Tr. 172). When asked by Respondent's counsel "[w]hy should the reference to the World War II apparatus in any wise find its way into the advertising literature of Vapor-Jet?" he stated: "Well, I don't really know" (Id.). Further, Dr. Guentzler stated that the airplane system used a 50% alcohol and 50% water solution that was injected as opposed to being introduced in vapor form. While stating that the two systems are analogous, he concluded: "It's a question of verbiage" (Tr. 327).

This proceeding is specifically concerned with "verbiage." The language in CX-1-a supports the conclusion of the Administrative Law Judge that the representation set forth in subparagraph 3(g) of the Complaint was made (see I.D. p. 4). The evidence establishes that the representation is false. Accordingly, the Administrative Law Judge's finding in this regard is affirmed.

Exception 4

"THE ADMINISTRATIVE LAW JUDGE ERRED AND ABUSED HIS DISCRETION IN FINDING THAT RESPONDENT'S ADVERTISEMENTS MAKE THE REPRESENTATIONS SET FORTH IN PARAGRAPH 3(h) OF COUNT I OF COMPLAINANT'S COMPLAINT, AND IN ENTERING HIS CONCLUSION OF LAW PURSUANT TO SUCH FINDING."

Respondent argues that although the Vapor-Jet has been patented, tested, and lessens fuel consumption, "Respondent's advertising specifically does not state that its invention was patented as a fuel saver," which is the representation alleged to be false in the Complaint (Resp. Brief at 9). The Administrative Law Judge found Respondent makes the charged representation through CX-1-a, which contains the headline "Gas saver tested and patented," and through CX-5-f, which consists of abstracts of the patent and fuel economy test results printed back to back on the same paper.

The ordinary reader would reasonably construe an advertising headline which includes the terms "gas saver" and "patent" in the same phrase, and advertising material which includes fuel economy test results and patent information back to back without further explanation, as representing that the advertised product was patented as a fuel saving device. The connection between the patent and fuel economy need not be expressly stated. In determining the truthfulness of advertisements for purposes of 39 U.S.C. § 3005, both express and implied representations are considered. Donaldson v. Read Magazin. Inc., 333 U.S. 178, 188-89 (1948); N. Van Dyne Advertising Agency, Inc., v. United States Postal Service, supra.

Respondent relies on testimony by Mr. Polowchak that an average person would not interpret CX-a-1 as representing that a patent had been obtained for a fuel saver, and states that the record is devoid of evidence to the contrary. Mr. Polowchak's evidence in this regard is not persuasive. Moreover, he admitted that "I can see how a person might possibly look at [the advertisement] that way" (Tr. 283) and, with respect to CX-5-f, admitted that he should have distinguished between the patent and test results (Tr. 262). As noted supra, whether an advertisement makes the representation alleged in the Complaint may be determined from the advertisement alone and Complainant is not required to produce supporting testimony. Accordingly, the Administrative Law Judge's finding that Respondent makes the representation alleged in subparagraph 3(h) of the Complaint is affirmed.

Exception 5

"THE ADMINISTRATIVE LAW JUDGE ERRED AND ABUSED HIS DISCRETION IN FINDING THAT RESPONDENT'S ADVERTISEMENTS CONTAIN MATERIALLY FALSE REPRESENTATION PURSUANT TO PARAGRAPH 3(e) OF THE COMPLAINT, AND IN ENTERING HIS CONCLUSION OF LAW PURSUANT TO SUCH FINDING."

Respondent argues that the Administrative Law Judge erred in finding that the representation alleged in subparagraph 3(e) of the Complaint is false. According to Respondent, the evidence establishes that "[t]he fuel economy and engine performance improvement claims . . . are supported by competent scientific research and test results." It cites tests performed by Dr. Guentzler and the Southern California Automobile Club and states that "[t]he record is totally devoid of any testimony tending to declare incompetent or invalid the scientific research and test results so presented by Respondent" (Resp. Brief at 11).

Respondent's argument misses the basic point. The competence of the Southern California test is not at issue here. Rather, at issue is the relevance of this test in supporting the specific representations made with regard to fuel economy and engine performance. In this regard, Dr. Guentzler stated that he is certain that Mr. Trevaskis received the 13.3% and 17.3% results "because they were done under a steady state mode of operation . . ." (Tr. 327-328). However, he also testified that Vapor-Jet "will get 5 to a maximum of 9 percent fuel economy improvement under average driving conditions. Only under steady state operational condition . . . would there be the capability of getting over 9 percent." (Tr. 331, 341 emphasis added). Thus, the test does not pertain to the average motor vehicle and does not support the fuel economy and engine performance representations.

With respect to Mr. Polowchak's testimonial that he had experienced an increase of four miles per gallon using Vapor-Jet, Dr. Guentzler stated:

"Everything is explainable, and I would assume from the information that I have heard that Mr. Polowchak's vehicle was probably in need of a tune up . . . however, if the vehicle had been given a fresh tune up prior to installation of the device and it would have been done in a correct research format, he would not have received four miles per gallon from the use of the Vapor-Jet device" (Tr. 339).

Dr. Guentzler further stated that "[t]he device works best between 40 and 60 miles an hour" under freeway conditions (Tr. 351), and will be most effective where carbon buildup exists (Tr. 334). However, Respondent's advertisements make no distinctions either with respect to type of driving or condition of the automobile in discussing the mileage improvement to be expected with the Vapor-Jet.

Although Complainant assumed the burden of proof on each of the charges set forth in the Complaint, once Complainant had made its prima facie case (see discussion under Exception 1 supra), Respondent was required to present evidence as to competent scientific research and test results in support of the disputed claims. Respondent was logically in possession of such proof. Athena Products, Ltd., P.S. Docket No. 7/99 (P.S.D. June 26, 1981); Project Prayer, P.S. Docket No. 8/68 (P.S.D. May 29, 1981).

However, it failed to produce persuasive evidence that its claims were supported by competent scientific research and test results. Accordingly, the Administrative Law Judge's finding that the representation set forth in subparagraph 3(e) of the Complaint is false is affirmed.

Exception 6

"THE ADMINISTRATIVE LAW JUDGE ERRED AND ABUSED HIS DISCRETION IN FINDING THAT RESPONDENT'S ADVERTISEMENTS CONTAIN MATERIALLY FALSE REPRESENTATIONS PURSUANT TO PARAGRAPH 3(f) OF THE COMPLAINT, AND IN ENTERING HIS CONCLUSION OF LAW PURSUANT TO SUCH FINDING."

Respondent argues that the Administrative Law Judge erroneously found that Vapor-Jet will not "dissolve carbon deposits on spark plugs and cylinder walls in older vehicles and prevent such build-up on newer vehicles." The Administrative Law Judge based this finding on Mr. Korth's testimony that:

"in his opinion Vapor-Jet will not dissolve carbon deposits and prevent such buildup in newer vehicles because the amount of water that it introduces is so small (Tr. 67) [and that of] Dr. Guentzler [who] also stated that water will not dissolve carbon deposits although it can remove carbon deposits in older cars (Tr. 333). He did not dispute Mr. Korth's testimony that Vapor-Jet will not prevent such buildup in newer vehicles." (I.D. at 9).

Specifically, Respondent contends that despite Dr. Guentzler's statement that the product does not technically "dissolve" carbon deposits, "it is obvious from a review of his unrebutted testimony that the effect advertised does, in fact, occur" (Resp. Brief at 12). Dr. Guentzler testified on this issue as follows:

"water can't dissolve anything. The way that carbon is removed . . . [is] that we put that water in, it raises the combustion pressure and the particulates break loose, and they go out the valve and they go out the tail pipe. So yes, [the Vapor-Jet] does de-carbonize, and by the way, it keeps the de-carbonization as long as the water is continually used. If you stop using it, carbon buildup will re-occur again. It does not dissolve.

Question [by Respondent's counsel]: So we have a problem with semantics.

Answer: Yes . . . You can use terms like reduces carbon buildup, or you could use any term that will indicate that carbon itself due to the higher pressure is going to be relieved, and hopefully eliminated.

Question: Well, in an older car that has a high carbon buildup, . . . would use of the device have the effect of removing the deposit?

Answer: Certainly." (Tr. 333)

Mr. Korth's testimony that the Vapor-Jet would not dissolve carbon deposits and prevent carbon buildup was based on the premise that "[t]he amount of water being introduced is so small." He admitted, however, that "It's technically reasonable that you can clean out combustion chambers by admitting significant amounts of water" (Tr. 67). Evidently, Dr. Guentzler is of the opinion that the Vapor-Jet would supply enough water to remove the carbon. In this regard, Dr. Guentzler questioned the validity of the EPA procedure for testing retrofit devices in that, among other things, it doe not deal with carbonization (Tr. 371).

The Administrative Law Judge has stated that he was extremely impressed by the testimony of Dr. Guentzler (I.D. at 7). Dr. Guentzler's testimony is persuasive that while carbon deposits are not "dissolved" in a technical sense, they are nonetheless removed through use of the Vapor-Jet.

It is concluded that an ordinary reader of Respondent's advertisement would be more interested in the ultimate benefit of having his car decarbonized than in the technical process by which this end is accomplished. It is unreasonable to conclude that such a reader would be materially induced to purchase the product by the statement that carbon would be "dissolved" as opposed to merely "removed." The language chosen by Respondent, although not technically correct, is nonetheless harmless. The underlying claim that decarbonization occurs is supported by the record.

In view of Dr. Guentzler's testimony that decarbonization continues as long as water is introduced into the carburetor, it follows that use of the Vapor-Jet not only removes carbon deposits in oder vehicles but, if continually used, would prevent carbon buildup on newer vehicles. Accordingly, the Administrative Law Judge's finding that the representations set forth in subparagraph 3(f) of the Complaint are materially false is reversed.

CONCLUSION

After consideration of the entire record and Respondent's exceptions, it is concluded that Respondent is engaged in a scheme to obtain money through the mail by means of materially false representations. Accordingly, Respondent's appeal is denied, except with respect to the Administrative Law Judge's finding that the representations contained in subparagraph 3(f) of the Complaint are false, which is reversed. A remedial order under 39 U.S.C. § 3005 is being issued with this Decision.