In the Matter of the Complaint Against

BELL-BOOK & CANDLE INCENSE COMPANY at
Los Angeles, California 90003

P.O.D. Docket No. 2/297

02/20/69

Rosenblatt, Peter R.

APPEARANCES:
For the Complainant:
Arthur S. Cahn, Esq.;
Office of the General Counsel,
Post Office Department, Washington, D.C. 20260

For the Respondent:
Stanley Fleishman, Esq.;
1680 Vine Street, Hollywood, California 90028

DEPARTMENTAL DECISION; STATEMENT

By complaint filed May 31, 1968 the General Counsel (the Complainant) charged that the Respondent, Bell-Book & Candle Incense Company, is engaged in a fraudulent scheme in violation of 39 U.S.C. § 4005. The Respondent by its attorney, denied the essential elements of the complaint in an answer filed June 21, 1968. After numerous exchanges on the matter of scheduling between the Chief Hearing Examiner and Respondent's attorney, the matter went to hearing in Los Angeles on September 17, 1968. The Respondent was represented at the hearing by one of its principals, a non-lawyer, because its attorney inexplicably and without forewarning failed to appear. At the conclusion of the hearing the Chief Hearing Examiner delivered an oral Initial Decision finding the Respondent in violation of 39 U.S.C. § 4005, as charged in the complaint. On September 30, 1968, two weeks later, the Respondent filed an instrument substituting the same principal as its attorney in place of the non-appearing lawyer.

The Respondent's present attorney indicated his appearance by letter dated October 11, 1968, and on November 1, 1968 he filed the Respondent's brief on appeal to the Judicial Officer. The Complainant's answering brief was filed on November 27, 1968.

THE COMPLAINT

The complaint charges the Respondent with obtaining remittances of money through the mails by means of false and fraudulent pretenses, representations and promises, in that its advertisements, copies of which are attached to the complaint, allegedly make the following claims:

a. The Respondent's advertised product, "Success Formula No. 7", possesses the supernatural or mystic power to assure the purchaser of the achievement of success.

b. The various items comprising "Success Formula No. 7", as well as "other powerful items" advertised, viz., "oils", "incense", "blessed candles" and "lucky sachet powders", possess the supernatural or mystic power to assure the purchaser of such diverse and tangible benefits as success, good luck, physical attraction and wealth.

c. The Book of Black and White Magic, as advertised, will enable the purchaser to employ supernatural or mystic powers in the conduct of his daily life.

d. Through the knowledge and the information gained by studying the Book of Black and White Magic. as advertised, the purchaser will be able to receive such diverse and tangible benefits and desires as success in romance, gambling, legal disputes and business affairs, influence over other persons and financial success.

e. "'We will also send you valuable Cuba information when you purchase . . .' the aforementioned publication 'and send us your date of birth.'" (The Complainant interprets this claim as a promise to send purchasers of the Book of Black and White Magic who furnish therin birthdate "valuable information concerning Cuba which will be significantly related to the date of remitter's birth".)

THE TESTIMONY

The Complainant called only one witness, Postal Inspector Martin I. Dworkis, who testified that he had purchased "Success Formula No. 7" and the Book of Black and White Magic from the Respondent by ordering and paying for them through the mails. The merchandise thus delivered was introduced into evidence. Inspector Dworkis' testimony established jurisdiction in this case under 39 U.S.C. § 4005.

The Respondent's first witness, Mrs. Rita Norling, testified that she owned the Respondent together with a minority partner named Ry Hammers, a retired policeman (37). ^1/ She said that the Respondent advertised in the Pittsburgh Courier, Fate Magazine and in local newspapers (37-39). Mrs. Norling's testimony, though rambling and confused, indicated that the business catered to the adherents of a "religion" which she described variously as "spiritualism", "voodoo", "occult", "not earthly mundane", "positive force", "positive thinking" and the like (33-35). At one point in her testimony she referred to her beliefs merely as the use of incense and oils (35). She said that the items sold by the Respondent were all identifiable and commonly known to others who shared her beliefs (33-4):

"The items that are offered for sale and people that are familiar with these items are those names that are known for many, many hundreds of years.

"If you ask for Lucky-High John, The Conqueror Incense, they know what it is. It is sort of a label or a brand.

"There is Fast Luck Drops and Lucky Hand are all mentioned in the book that I offer for sale.

"Now, I find that people do not believe in spiritualism as a religion or an occult or anything that is not earthly mundane have no interest in the booklet whatsoever . . ."

The Respondent's second witness was Joan Hall, a private-duty nurse, who testified that she bought the Book of Black and White Magic from the Respondent after learning about it from the advertisement in Fate Magazine, which she buys every month (45-6). She testified that she did not think that the book would give her any supernatural powers (47). She had been reading material of this nature for some ten years (47), preferring it "to movie gossip magazines or modern romances or things like that" (49). She bought incense because she just like the aroma--finding it superior to "a spray can to disinfect my home sometimes" (49). By the same token, the oils have "a fragrance that lasts sometimes longer than something you would buy at the drugstore or a perfume counter" (49). She evidently preferred the Respondent's brand to others because "There are some that smell pretty terrible" (49).

DISCUSSION

The Respondent's advertisements in Fate Magazine and The Pittsburgh Courier promote the Book of Black and White Magic or a "free success formula." The remitter receives, in addition to the item he has sent for, more advertisements from the Respondent describing "Success Formula No. 7" and various types of oils, incenses, blessed candles or lucky sachet powders, such as "attraction oil", "success incense", or "money-drawing" blessed candles. There is also enclosed an order blank by which these items may be ordered through the mails.

The pertinent facts herein are essentially identical to those described in Gottlieb v. Schaffer (SDNY 1956) 141 F.Supp. 7 (in fact the Respondent in each case advertised in The Pittsburgh Courier). This case is covered and controlled by that decision. The court there held (Ibid, pp. 15-16):

"The mail fraud order statutes are aimed at protecting the public against fraudulent schemes--the prevention of future injury to the public. The issue of fraud under these statutes is to be determined 'in the light of the effect advertisements would most probably produce on ordinary minds.'

"The advertisements here make patently absurd claims which could only appeal to the superstitious, the ignorant and the gullible--an extreme segment of the community, the members of which clearly do not qualify as possessed of the 'ordinary mind'. Does the 'ordinary mind' represent the lowest common denominator in determining whether the representations are fraudulent and calculated to mislead, thereby excluding consideration of their impact upon other segments of the community? I am of the view that on the issue of the impact of advertising matter upon the public, the fraud order statute is to be given a somewhat broader interpretation than that applied to the obscene mailing law, which invokes criminal penalties. In the latter instance it has been held that the effect upon the average of the community is the determinative factor, and this excludes particular segments. The test there applied is that the alleged objectionable matter "must be considered as a whole in its effect, not upon any particular class, but upon all those whom it is likely to reach.'

"In the instance of the mail fraud law, if the evidence establishes that the scheme is directed toward the gullible and the simple, the protection of the statute is not to be denied them even though they do not reach the level of the 'ordinary mind'. The purpose of the statute is to protect the unwary and unsuspecting as well as the knowledgeable and wordly-wise--those who are 'trusting as well as the suspicious.' The public includes '"that vast multitude . . . the ignorant, the unthinking and the credulous."' The fact that informed and sophisticated persons would readily recognize, laugh off, or even be amused by, obviously false and absurd statements in an advertisement does not detract from their power to deceive the ignorant, gullible and less experienced."

The court found that fraudulency had been established by (Ibid., p. 17):

"The type of publication in which the advertisements were inserted with their obvious appeal to a susceptible and easily influenced group, the nature of the advertisements, their combination and use in connection with other advertising media issued by the plaintiff, the focus of the advertising campaign, . . .

"In this instance the claimed representations defy universality of experience. The hearing officer found the plaintiff's claims 'so preposterous and opposed to common knowledge and experience as to carry within themselves, without more, evence of their falsity.' On this record it cannot be said there was no substantial evidence to support the finding so made by the examiner."

The factual situation, and therefore the findings and the legal rationale are the same in this case with respect to Charges a through d of the Complaint. I find, however, that no evidence was offered in support of Charge e, concerning "Cuba information". The Initial Decision is therefore reversed insofar as that charge of complaint is concerned.

The Respondent attacks the Initial Decision on two grounds. Firstly, it is claimed that the Respondent's religious beliefs were put on trial in contravention of the First Amendment. The Respondent charges further that the hearing examiner's alleged finding that Mrs. Norling did not believe in her "religion, philosophy, and faith" in good faith deprived the Respondent of freedom of speech and press and due process of law. In so arguing the Respondent relies almost entirely upon U.S. v. Ballard (1944) 322 U.S. 78. The contention is entirely without merit.

In Ballard, which involved a criminal prosecution, the defendants were charged with using the mails to defraud by fraudulently promoting a new religious movement, selling literature about it and soliciting funds and members. The Supreme Court held that the truth of the defendants' beliefs could not be submitted to the jury. The only question the jury could legitimately be asked to decide was whether the defendants held their views sincerely.

By contrast, in this case the Respondent does not seek to preach or organize a religion. Its advertising does not indicate that the items promoted are used in religious worship. In fact the advertising materials sent out together with orders specifically disavow any "supernatural claim." Page 4 of the Book of Black and White Magic carries the following disclaimer:

"The promotion or undue influence in advocating superstition is entirely disclaimed by the author, and he also does not assume responsibility for an action on the part of the reader."

These protestations appear to have been included in all of the Respondent's promotional literature. While they are wholly inadequate to forestall a proceeding such as this, their inclusion does undercut the religious argument and shows up the whole operation for the simple business enterprise it is.

Although the Respondent's witness Joan Hall, who said she bought Respondent's incenses and oils because she liked their odor, did not lend much support to the point. Mrs. Norling's quoted (p. 5) observations on her clientele are persuasive. She seemed to be saying that those who read the publications in which the Respondent's advertisements appear, or are attracted by them and moved to act on them tend to react thereto because they are already "believers" in black magic and such like. She seemed to have been pointing to the conclusion that since the advertisements were directed at an amorphous body of presumed fellow-believers, they should be regarded as a kind of internal "church" communication.

The point does have some validity, particularly in light of the fact that beliefs of this nature have traditionally been associated with, as the Book of Black and White Magic (p. 4) puts it, "cult belief". The believers, largely poor and ignorant persons influenced by the Western world's last surviving embers of primitive anamism, are not organized and cannot, therefore, be reached through the established channels of legitimate religious or social organizations.

However the argument, as it applies to the Respondent's misleading promotional statements possesses little more validity than an equally fraudulent sexually oriented appeal to the readers of a "girlie" magazine or a fraudulent advertisement for a new method of prognostication placed in a horse-racing sheet.

The crucial element here is the advertisement's false promise. The Respondent's advertising promotion is quite straightforward in its attempt to sell goods on the basis of a crassly secular appeal to the reader's desire for material or amatory success. Far from serving the needs of a religious community, the Respondent's business capitalizes on the credulity and ignorance of a particularly unsophisticated group, utilizing their vulnerability to appeals of this nature as the environmental basis for a fraudulent commercial appeal.

The "religious" issue first entered the case through Mrs. Norling's testimony and counsel's subsequent labored attempt to develop a lofty constitutional argument on appeal. It will be noted that no trace of the religious argument is to be found in the Respondent's Summary of Testimony, filed August 7, 1968. The issue here is the indiscriminate fraudulent public advertising and sale of magic supplies rather than the right to believe in their efficacy.

Mrs. Norling and others who believe as she does are surely entitled to remain secure from official interference in their practices where these do not inhibit the rights of others. However their freedom of belief does not entitle the Respondent to operate an ordinary commercial enterprise based upon advertising misrepresentations directed to the public at large. "A religious ingredient is no better defense to a charge of fraud than a charge of muder" [Fields v. Hannegan (C.A., D.C. 1947) 162 F.(2d) 17, cert. den. 332 U.S. 773].

Counsel for the Respondent attacks the Initial Decision upon a second ground as well. He asserts that his client was denied due process of law in that the Hearing Examiner allegedly obliged the parties to submit oral proposed findings of fact and conclusions of law at the close of the hearing without advance notice of the requirement and at a time when the Respondent was without the services of counsel.

In fact, the Respondent had been actively represented by counsel at all stages of the proceeding prior to the hearing itself. The record shows that the hearing date had to be adjourned no less than six times in barely more than two months, first by reason of counsel's unexcused failure to supply required information in support of his application for a change of venue, and then in response to his repeated last-moment requests for adjournments.

Relying upon an agreement hard-won from counsel to go to hearing on September 17, 1968 in Los Angeles the Hearing Examiner, Department counsel and the Department's witness journeyed the breadth of the country to convene the hearing. There is no evidence that counsel made any attempt to provide the Hearing Examiner with advance notice of his evident intention not to appear at the hearing [allegedly imparted to his client on September 16, the evening before (3-4)]. Nor did the Respondent, the Respondent's former attorney or successor counsel make any attempt, even after the conclusion of the hearing, to explain counsel's unexcused, inexcusable and highly suspicious failure to appear at the hearing. It will be noted that Respondent did not even attempt to file an instrument substituting Mrs. Norling as counsel until several days after the hearing.

The Hearing Examiner complied with the Rules of Procedure and the fundamental dictates of fairness in providing the parties with written advance notice on July 18, 1968--two months' advance notice, as it developed--of the requirement "to submit proposed findings and conclusions at the close of the hearing in accordance with the provisions of Section 952.24(c) of the Rules of Practice." The Hearing Examiner issued a second such notice to the parties at the eve of the hearing, on September 16, 1968, at which time Respondent's counsel's intended non-appearance was still unknown. the parties could not, therefore, have expected or received more ample notice of the Hearing Examiner's intention to issue an oral decision at the close of the hearing. The Hearing Examiner was fully justified in adhering to his previously announced intention of requesting oral proposed findings of fact and conclusions of law and rendering his own oral decision at the close of the hearing, despite Respondent's "unreadiness" by reason of counsel's absence.

The Respondent was given every opportunity to present its argument at the hearing and, to judge by the Summary of Testimony filed by the Respondent on August 7, 1968, succeeded in so doing with the available witnesses.

A contrary holding on this argument of Respondent's would constitute nothing less than an invitation to litigants before this Department's tribunals to agree to hearings at some distant place and then fail to appear, confronting the Department's hearing officers with a choice between indefinite immobilization, repeated fruitless journeys to the hearing place or holding an invalid hearing.

I find counsel's still unexplained failure to appear at the hearing and his entire behavior in connection therewith to have been shocking and wholly unprofessional. I am therefore forwarding a copy of this decision to the State Bar of California for its review and consideration.

For all of the foregoing reasons I find that the Respondent's activities complained of (with the exception of Charge e of the complaint, see p. 7, supra) constitute a fraudulent scheme in violation of 39 U.S.C. § 4005. A fraud order will, accordingly, issue forthwith.

1/ References, unless otherwise noted, are to pages of the typed transcript of the hearing.