In the Matter of the Complaint Against

TELCOM DIRECTORIES, INC.,
a corporation,

and

VERNON R. FRAZIER
individually and as an
officer or employee of
said corporation,
2120 Crestmoor at
Nashville, TN 37215-2613

P.S. Docket No. 22/112

James A. Cohen Judicial Officer

APPEARANCES FOR COMPLAINANT:
H. Richard Hefner, Esq.
Steven B. Caver, Esq.
Consumer Protection Division
Law Department
United States Postal Service
Washington, DC 20260-1112

APPEARANCE FOR RESPONDENT:
Frank J. Shannon, III, Esq.
Henritze & Shannon
127 Peachtree Street
Atlanta, GA 30303-1810

POSTAL SERVICE DECISION

Respondents have filed an appeal from an Initial Decision of an Administrative Law Judge which holds that Respondents distribute solicitations in the guise of bills or invoices in violation of 39 U.S.C. 3001(d) and are engaged in a scheme or device for obtaining money or property through the mail by means of materially false representations in violation of 39 U.S.C. 3005.

BACKGROUND

This proceeding was initiated by the filing of a Complaint by the Consumer Protection Division, Law Department, United States Postal Service (Complainant) alleging that Respondents have violated 39 U.S.C. 3001(d) and 3005 by the distribution of unsolicited mailings in the form of bills or invoices which falsely represent that:

"8. . . .

(a) The addressee has previously authorized a business listing in Respondents' classified directory;

(b) The amount set forth on the face of the solicitation is due and owed to Respondents;

(c) Telcom Directories, Inc. is part of or affiliated with the telephone company serving the recipient's area; and

(d) Telcom Directories, Inc. is the publisher of the classified directory or 'yellow pages' normally supplied to all telephone subscribers in the recipient's area.

In a timely filed Answer, Respondents denied the allegations of the Complaint and asserted various jurisdictional and constitutional defenses.

A hearing was held before an Administrative Law Judge at which Complainant presented the testimony of Paul Scipione, Ph.D., an expert in marketing and consumer psychology, and Postal Inspector Fred Sturdevant. Respondents presented no evidence at the hearing. Following the filing of post hearing briefs, the Administrative Law Judge issued an Initial Decision in which he concluded that Respondents' solicitations are in the form of and reasonably could be interpreted or construed as bills or invoices, and that they make the false representations alleged in the Complaint. The Administrative Law Judge also rejected Respondents' affirmative defenses or found that they were beyond his authority to decide.

Respondents' Exceptions

In their exceptions to the Initial Decision, Respondents generally contend that the Administrative Law Judge erred in finding that the solicitations are in the form of and reasonably could be construed as bills or invoices and that they make the false representations alleged in the Complaint. Respondents also contend that the Administrative Law Judge incorrectly ruled on their res judicata defense.

DECISION

Respondents' exceptions and arguments have been considered in light of the entire record. These exceptions and arguments are essentially the same as those presented in Telco Directories, Inc., P.S. Docket No. 22/111, a companion proceeding, which has been considered and decided simultaneously with this case. In the Postal Service decision in Telco Directories, Inc. , P.S. Docket No. 22/111, Respondents' arguments were rejected and the Administrative Law Judge's Initial Decision was affirmed. The reasoning and rulings of the companion Telco case are incorporated herein by reference, and with one exception, provide the same basis for affirming the Administrative Law Judge's Initial Decision and rejecting Respondents' arguments and exceptions on appeal in this proceeding.

The sole exception relates to the legibility of the reproduction of Respondents' solicitation admitted into evidence as CX-4. At the hearing, Complainant introduced into evidence copies of all of Respondents' solicitations made on a copying machine at the regular setting (Tr. 114-18, 121-22). Contrary to the Administrative Law Judge's finding, the disclaimer on CX-4 is legible when copied. Nonetheless, this disclaimer is defective because the statement of amount due overprints a portion of the disclaimer rather than the disclaimer overprinting the statement of amount due as required by DMM 123.41b. Accordingly, Respondents' solicitation CX-4 does not comply with Postal regulations and is nonmailable under 39 U.S.C. 3001(d).

CONCLUSION

After consideration of the entire record and Respondents' exceptions, it is concluded that Respondents distribute solicitations in the guise of bills or invoices in violation of 39 U.S.C. 3001(d) and are engaged in a scheme or device for obtaining money through the mail by means of materially false representations in violation of 39 U.S.C. 3005. Accordingly, the Initial Decision is affirmed with the one exception stated herein, Respondents' appeal is denied and the orders authorized by 39 U.S.C. 3005 are issued with this decision.