In the Matter of the Complaint Against

SPECTRON IND.
P. O. Box 17200 at
San Diego, California 92117

P.S. Docket No. 2/8;

APPEARANCES:

James J. Robertson, Esq.
Law Department
U. S. Postal Service
Washington, D. C. 20260
for the Complainant

Melvyn B. Stein, Esq.
Ellman and Stein
110 West "C" Street
San Diego, California 92101
for the Respondent

POSTAL SERVICE DECISION

The above-captioned matter is before the Judicial Officer on Respondent's appeal from the Initial Decision of the Administrative Law Judge recommending the issuance of a mail stop order with respect to the promotion of Respondent's product "Spectron C-33" as provided in 39 U.S.C. 3005.

Respondent's first "Exception" to findings of fact is:

"1. The finding that appellant guaranteed in his advertisement a cure for baldness and hair growth is untrue. The only allegation which appellant makes in his advertisement is that a medical research group used amino acids to regenerate a substance in the human tissue proving crucial to hair growth. The presiding officer found that the advertisement did not use the word 'pattern' in referring to baldness (R.T., page 36)."

The headline of the advertisement is "STOP Worrying About Baldness with SPECTRON C-33". This is followed by two paragraphs relating to a "revolutionary cure for baldness" purportedly proven by successful results obtained by a research group. The advertisement then relates the ingredients in Respondent's product to the substances said to have been used by the test group. The advertisement then states "ARE WE PROUD, you bet, so proud that we offer an unconditional GUARANTEE, for NEW HAIR GROWTH, THICKER HAIR, DANDRUFF, or ITCHING SCALP. C-33 HAS CORRECTED ALL".

It is disingenuous for Respondent to say, as he does, "that appellant has guaranteed *** a cure for baldness and hair growth is untrue. The only allegation appellant makes *** is that a medical research group used amino acids to regenerate a substance in the human tissue proving crucial to hair growth." The exception not only misstates Judge Knight's finding, but the content of the advertising as well. The Initial Decision does not find "a guarantee" was made. However, the advertisement does, in fact, state "we offer an unconditional guarantee for new hair growth." Moreover, the reported research results are not stated in the vague terms Respondent's exceptions indicate. Rather the report alleges specifically that the test demonstrated new hair growth for 13 of 14 patients. It is clear that the advertisement represents that the product will cure baldness generally. Since male type pattern baldness afflicts a large proportion, perhaps substantially all of the male population to some degree, and is the usual or normal type of baldness, the representation of a cure for baldness certainly includes the cure of male type pattern baldness. ^1/ Accordingly, it must be concluded that Respondent represents that the product will cure, among other things, male pattern baldness.

The second exception is:

"2. The decision does not take into effect the testimony that hair could be restored on the scalp where loss of hair was due to other than male pattern baldness and simple massage and heat treatments may restore the hair. (R.T., page 44). The same witness further testified that there may be some drugs that help the growth of hair, (R.T., page 45)."

The testimony referred to is as follows:

"Now you did not say that this male pattern baldness--that this was male pattern baldness. You didn't state in your hypothetical question that this was a diseased caused or drug caused or whatever.

"As I said earlier, if it was male pattern baldness, all the cremes in the world would not restore hair on the scalp. If it was other types of baldness, simple massage might do it. Heat treatments might restore hair. Or removal of the offending drug or disease might help to restore that hair.

"The answer is qualified as to the type of baldness." (Tr. p. 44, 11. 11-20)

"Q. -- Hair; and I am not confining it to male pattern baldness. Is there any drug that could assist in growing hair on the top of your head where it may have been bald for some reason or another?

"A. For some reason or another - within that range I will say there may be some drugs that may help the growth of hair, but not normal hair." (Tr. p. 45, 11. 15-21)

The conclusions reached in the Initial Decision could not be altered by this testimony that states none of the procedures will restore hair lost in male pattern baldness, that in other types of baldness some drugs might grow hair that is not a normal hair or that in those kinds of baldness massage or heat treatment, as opposed to application of a cream such as Respondent's product, could stimulate hair growth. The medical testimony did deal with the ingredients represented by Respondent's advertising to be in Spectron C-33. However, the opinions expressed by the medical experts as to the efficacy of the product were not dependent upon the presence or absence of particular ingredients. In any event Respondent not only forewent his opportunity to cross-examine the experts as to the possible effect of ingredients not listed, but specifically instructed his witness who knew the formula of Spectron C-33 not to divulge the ingredients during cross-examination by Complainant's Counsel. He can hardly complain that the Administrative Law Judge did not take into account that which Respondent prevented from being presented to the trier of the facts.

A further exception is taken to the terms of the proposed order which Respondent challenges as being too broad and further contends that the conditions here are factually different from those present in Lynch v. Blount, 330 F.Supp. 689 (S.D. N.Y. 1971), aff'd 404 U.S. 1007 (1972). In pursuit of this argument Respondent has moved to reopen the record for the purpose of taking additional evidence regarding other advertising for Spectron C-33 used by Respondent. Respondent is apparently seeking merely to limit the order to mail addressed to Box 17200 and in response to the advertisements in Male Magazine. The evidence on solicitations by Respondent introduced in the hearing relates only to P. O. Box 17200. Accordingly, the order issued in this proceeding will apply only to mail addressed to that box number. On the other hand, no further limitation would be justified at this time.

The Complaint requested issuance of "an order conforming with 39 U.S.C. 3005(a)(1) and (2) *** against Respondent". As limited above, the proposed order closely follows the statutory provisions cited. Thus, insofar as mail is concerned, it "directs the postmaster of the post office at which mail arrives, addressed to such a person or to his representative, to return such mail to the sender appropriately marked as in violation of this section, if the person, or his representative, is first notified and given reasonable opportunity to be present at the receiving post office to survey the mail before the postmaster returns the mail to the sender; ***". Respondent, therefore, should not have been taken by surprise by the terms of the order. Yet, Respondent did not raise the question of the scope of either in his answer. Nor did he offer proof at the hearing that other advertisements of Respondent did not contain the representations charged and now found to be false, or suggest how an order should be drawn to exclude mail orders generated solely by such advertisements if they existed. ^2/

Members of the public ought not suffer losses because Respondent delayed in raising this matter. On the other hand, Section 952.29 of the Rules of Practice (39 C.F.R. 952.29), as amended (38 F.R. 17216) provides for applications to modify mail stop orders. A showing that identifiable mail orders for Spectron C-33 are received from solicitations free of false representations could be a basis for requesting a narrowing of the order. ^3/ While other advertising for the product may exclude the claims found here to be objectionable, it cannot be assumed that such is the case.

Accordingly, Respondent's application for an order reopening the hearing for the taking of additional testimony is denied. Complainant's motion to supplement the record, not being opposed, is granted. ^4/

Respondent's exceptions are denied except as noted. Respondent is found to be engaged in conducting a scheme or device for obtaining money through the mail by means of false representations. The remedial order recommended by the Administrative Law Judge will issue forthwith, except that the order will be limited to mail addressed to Spectron C-33 at P. O. Box 17200, San Diego, California 92117 and the Postmaster at San Diego will be directed to retain temporarily at his office the mail covered by the order rather than returning it to the senders. Retention of the mail will allow Respondent 14 days from the date of this order to have an application for modification of the order in the hands of the Docket Clerk. Upon receipt of such an application, the Judicial Officer will consider what, if any, modification is appropriate before ordering the return of mail sought to be saved by the application.

Adam G. Wenchel Judicial Officer

09/12/73

Wenchel, Adam G.

____________________

1/ While not critical to this proceeding it is noted the advertisement (Exhibit C-1) in evidence was identified as appearing in the magazine "Male".

2/ Respondent's oral motion at the opening of the hearing was to dismiss the proceeding on the ground that 39 U.S.C. 3005 is unconstitutional for various reasons and because the time allowed for preparation for the hearing was unduly short. He did not, however, urge that the relief sought was unduly broad in the respect argued on appeal. established that Respondent is engaged in a scheme or device for obtaining money through the mails by means of false representations. Respondent has not, until after the record was closed and Initial Decision issued, sought to establish that some identifiable portion of the incoming mail orders at P. O. Box 17200 is obtained from advertising not containing the false representations involved in the advertising here. Under the circumstances it would be contrary to the public interest to withhold issuance of a remedial order and allow additional persons to lose money to false representations. Whether Respondent made those representations ignorantly or willfully he has no right to continue to receive remittances improperly induced.

3/ I have noted Complainant's suggestion that the order be limited to the mail received in connection with "the ad which appeared in Male Magazine, or any substantially similar ad which appeared in any other magazine." No one has yet indicated either how such a limitation can be applied as a practical matter, or how the "similarity" of other advertising would be determined. Such a presentation can be made on an application for modification of the remedial order if one is filed.

4/ Some confusion in the transcript of the judicial proceeding was generated by attributing to the Judicial Officer actions taken or recommended by the Administrative Law Judge (formerly Hearing Examiner). Issuance of the instant decision is the first action taken by the Judicial Officer of the Postal Service.