In the Matter of the Complaint Against:

KEITH EDWARD MAYDAK,
613 Cross Street,
East McKeesport, PA 15035-1307
and
ANY AND ALL OF VARIOUS NAMES,
519 Penn Avenue,
Turtle Creek, PA 15145-2057

P.S. Docket No. 31/88

Cohen, James A., Judicial Officer

APPEARANCE FOR COMPLAINANT: Wendy A. Hocking, Esq., W. Gary
Claytor, Esq., Consumer Protection Division, Law Department, United
States Postal Service, Washington, DC 20260-1144

APPEARANCE FOR RESPONDENT: Keith E. Maydak, 613 Cross Street, E.
McKeesport, PA 15035-1306

TO CEASE AND DESIST AND MOTIONS TO STRIKE AND DISMISS

On March 6, 1990, Complainant filed a Petition alleging that Respondent Keith Edward Maydak has breached the terms of an Agreement Containing Consent Order to Cease and Desist ("Consent Agreement") executed on July 27, 1988. Complainant contends that Respondent has resumed making the representations which, under paragraph 3 of the Consent Agreement and the terms of Cease and Desist Order No. CD-2062, he agreed to discontinue. In its Petition, Complainant requested the issuance of an Interim Detention Order and a False Representation Order against any and all of various names at the following addresses:

2681 Monroeville Blvd., Suite 436 Monroeville, PA 15146-2301

6393 Penn Ave., Suite 118 Pittsburgh, PA 15206-4010

3766 Fish Creek Road, Suite 130 Stow, OH 44224-5408

On March 7, 1990, an Interim Detention Order as authorized by paragraph 6 of the Consent Agreement was issued directing the detention of mail addressed to Keith Edward Maydak and Richard L. Fibb at 2681 Monroeville Blvd., Suite 436, Monroeville, PA 15146-2301 and Keith Edward Maydak at 3766 Fish Creek Road, Suite 130, Stow, OH 44224-5408. Complainant's request for additional relief against other names and addresses was not supported by the attachments to the Petition, and that portion of the Petition was dismissed without prejudice.

The Interim Detention Order granted Respondent a period of ten days in which to file a reply to the Petition. On March 21, 1990, Respondent filed an Answer to the Petition, along with a Motion to Dismiss, a Motion to Strike and supporting Declarations. In his Answer and Motions, Respondent does not deny that, subsequent to the execution of the Consent Agreement, he submitted credit card applications containing fictitious names and/or false information regarding the applicant's employment status. He concedes that use of the admittedly fictitious name of Richard Fibb violates the terms of the Consent Agreement and that the Order sought in the Petition may be issued against that name. However, he challenges the validity and the interpretation of the Consent Agreement and the Cease and Desist Order as applied to applications for credit cards submitted in his own name.

FINDINGS OF FACT

The Consent Agreement was executed by Respondent for and in consideration of Complainant's offer to move to suspend administrative proceedings under the postal false representations statute, 39 U.S.C. § 3005 (see Consent Agreement). By the terms of the Consent Agreement, Respondent agreed "to permanently discontinue the practice of submitting credit card applications in various fictitious and assumed names and to abide by the terms of the cease and desist order. . . " (Consent Agreement, para. 3). The Consent Agreement further stipulated that "Respondent Keith Edward Maydak, a minor, 17 years of age, acknowledges that he has read the Complaint and this Agreement, that both he and his mother, Christine Maydak, have had an opportunity to review and discuss both documents with an attorney or other person of their own choosing, and that Respondent executes this Agreement voluntarily." (Consent Agreement, para. 11).

The Consent Agreement was executed on July 27, 1988, following an interview of Respondent by Postal Inspector D.F. Williams at Respondent's residence on June 23, 1988. Respondent's mother and another Postal Inspector were also present during the interview (Attachment A to Complainant's Response to Respondent's Answer).

The Cease and Desist Order issued pursuant to the Consent Agreement ordered that Respondent "forthwith cease and desist from engaging in any scheme or device for obtaining money or property through the United States mail in any manner whereby Respondent falsely represents. . .Respondent's true identity, employment status, or credit history."

Subsequent to the execution of the Consent Agreement, Respondent applied for credit cards in his own name, to be sent to 2681 Monroeville Blvd., #436, Monroeville, PA 15146 (Exhibit F3), and to 3766 Fish Creek Road, #130, Stow, OH 44224 (Exhibit F4). In these applications he represented his employment status as an order clerk employed for three years at IGT, Inc., earning $1,650 per month (Exhibit F3) and as a Sales Consultant employed for four years at Intergalactic Telephonics, earning $2,625 per month (Exhibit F4). Respondent also applied for two credit cards in the name of Richard Fibb, using the Monroeville address and listing his employment status as Public Relations, employed for five years and one month (Exhibit F1) or six years (Exhibit F2) at Intergalactic Telephonics and earning $3,200 per month (Exhibit F1) or $41,390 annually (Exhibit F2). Respondent also submitted a credit card application in the name of Kirk Begian at P.O. Box 100, Wilmerding, PA 15148, listing his employment status as a sales manager employed for five years at Intergalactic Telephonics, and earning $2,740 per month (Exhibit F5).

In an oral statement to a Postal Inspector on November 14, 1989, Respondent admitted that he was unemployed and that Intergalactic Telephonics (IGT, Inc.) has no physical location, employees, suppliers, inventory or customers (Exhibit E). In a sworn statement given in writing to Postal Inspectors on January 23, 1990, Respondent also admitted that he had used the names Kirk Begian and Richard Fibb to establish a false identity (Exhibits E and G).

RESPONDENT'S MOTION TO DISMISS

In his Motion to Dismiss and accompanying Declaration, Respondent alleges that he was not advised of his right to remain silent or to have legal counsel, that he did not know what he was doing and that because he was a minor, under Pennsylvania law he is not bound by the terms of the Consent Agreement.

During the course of the June 23, 1988 interview and at the time of the execution of the Consent Agreement, Respondent's mother was present and available to protect Respondent's interests. By the terms of the Consent Agreement itself Respondent and his mother acknowledged that they had been given an opportunity to review and discuss the Complaint and the Consent Agreement with an attorney or other person of their own choosing, and that the Consent Agreement had been voluntarily executed. Respondent had over a month to consult an attorney between the time he was initially interviewed by a Postal Inspector and the date he and his mother executed the Consent Agreement. n1 See Attachment A to Complainant's Response to Respondent's Answer.

n1 In Complainant's Response to Respondent's Answer, the interview is referred to as having taken place on July 23, 1988. Respondent's Declaration in support of his Motion to Dismiss also states that the interview took place in July of 1988. However, because the Memorandum of Interview itself is dated June 23, 1988, that date has been referred to as the actual date the interview took place. Even if the interview was conducted on July 23, Respondent and his mother had ample time to determine whether legal consultation was necessary or advisable. All of these factors serve to refute Respondent's argument that he was deprived of an opportunity to consult legal counsel and that he was coerced into executing the Consent Agreement.

Respondent's assertion that he was not informed of his right to remain silent is equally without merit since there is no requirement for such advice in connection with this type of proceeding. See Church of the Good Samaritan, P.S. Docket No. 6/194 (PSD Feb. 22, 1980). Even if the requirement for such advice could be construed to apply to a civil action, the circumstances here do not establish that the Inspector's actions amounted to a custodial interrogation requiring notice of Respondent's constitutional rights. Church of the Good Samaritan, supra at 3-4; see also Irwin v. United States, 338 F.2d 770 (1964), and &UUniversal Life Church, Inc., P.S. Docket No. 7/62 (PSD Feb. 14, 1980).

Respondent's allegation that he did not understand what he was doing when he signed the Consent Agreement is not credible in light of the circumstances surrounding this matter. First, although Respondent had not arrived at the age at which all contracts with him would be binding, he was of sufficient age to appreciate the nature of the Consent Agreement and to know whether or not it was for his benefit. See Pankas v. Bell, 198 A.2d 312 at 315 (Pa. 1964). Further, the nature of Respondent's activities which involved the use of credit card applications with false names, employment data, and salary information to seek remittances to various addresses reflects a degree of sophistication which casts serious doubt on his protestations that he was unable to understand his obligations under the Consent Agreement at the time it was executed.

Respondent's reliance on Pennsylvania law to establish that he should not be bound by the Consent Agreement is similarly misplaced. The law of that state does not automatically absolve minors of responsibility for their contracts. As stated in Frank v. Volkswagenwerk, 522 F.2d 321, 329 (3rd Cir. 1975),

"While the law in Pennsylvania generally is that minors may disaffirm their contracts upon reaching majority, the cases involving releases have all placed considerable emphasis on the question of whether the minor had personally received part of the consideration paid therefor or had participated in its benefits. . ."

The Pennsylvania Supreme Court held in Pankas v. Bell, supra, at 314 (quoting Harbison v. Mawhinney, 8 Pa. Dist.R. 697) that minors may be bound by contracts which were "'as a whole beneficial to the infant . . .'" The court went on to say that

[b]ehind the rule rendering voidable the contracts of a minor is the very laudable purpose of the law to protect minors from contracts which may be disadvantageous to them and to protect them "against their own lack of discretion and against the snares of designing persons" (citations omitted). This "protective cloak" is to safeguard the interests of the minor; it is not to be employed as a vehicle whereby the minor is enabled to practice unconscionable business methods. It is a shield for defense, not a sword for offense. Id. at 315.

Thus, under Pennsylvania law where there is no evidence of fraud or overreaching and the contract as a whole is beneficial to the minor, the minor may be bound by his agreement. In this case, the Consent Agreement was explicitly entered into "in consideration of the Complainant's offer to move to suspend further proceedings" under 39 U.S.C. § 3005. Complainant did so move and proceedings were in fact suspended; therefore, Respondent clearly received and benefited from the consideration contemplated by the Consent Agreement.

Accordingly, Respondent's challenges to the validity of the Consent Agreement are without merit. Although Respondent was a minor at the time he executed the Consent Agreement, he may be bound by its terms without offending either the Constitution or the law of the state of Pennsylvania. The Motion to Dismiss is therefore denied.

RESPONDENT'S MOTION TO STRIKE

Respondent asserts that Exhibits F1 through F5 are inadmissable and should therefore be stricken from the record. Respondent contends that the credit card applications were not relevant to Complainant's Petition because they were not sent through the mail. Contrary to Respondent's assertion, Exhibits F1 and F2 both include postmarks, indicating that the applications were in fact entered into the mail stream. However, for jurisdictional purposes, submission of the applications through the mail is not required in order for Respondent's activities to be covered by the terms of the Consent Agreement, since the cease and desist order refers to schemes or devices "for obtaining money or property through the United States mail." Because Respondent was attempting to obtain credit cards and extensions of credit through the mail, his activities fall within the scope of the Cease and Desist Order.

Respondent also contends that Exhibit F5 is not relevant to this proceeding and should be stricken from the record because Complainant did not request the detention and return of mail to the address on that application. Mail to the address included on Exhibit F5 is being returned to sender in accordance with Withholding of Mail Order No. 90-35, issued in Intergalactic Telephonics, PS WM-96 (April 18, 1990). A further Order with respect to this address is unnecessary. The application is, however, relevant to Complainant's demonstration of a prima facie case that Respondent has continued or resumed the course of conduct he agreed to permanently discontinue. Therefore, Exhibit F5 was properly included in the record.

Finally, Respondent alleges that the Exhibits should be stricken from the record because they were illegally obtained. Complainant's response asserts, however, and the envelope depicted on Exhibit F2 confirms, that the credit card applications were voluntarily provided to Postal Inspectors by the companies to which they had been submitted. Moreover, Respondent has not established that a warrant was required or that the Exhibits were otherwise obtained illegally. Accordingly, Respondent's argument in this regard has no merit.

Complainant's Exhibits are relevant and have not been shown to have been unlawfully obtained. Therefore, Respondent's Motion to Strike is denied.

RESPONDENT'S ANSWER

In his Answer and accompanying Declarations and Motions, Respondent does not deny that he submitted the credit card applications or that certain of the representations made thereon are false. The unchallenged allegations make a prima facie showing that Respondent has breached the terms of the Consent Agreement. Mummers and Law Enforcement Academy, P.S. Docket Nos. 22/67 and 22/99, (PSD Jan. 8, 1987). Respondent makes several contentions, however, regarding the validity of the Consent Agreement and its application to his use of his own name.

Respondent admits that the name of Richard Fibb is fictitious and does not contest the return of mail directed to that name. However, he contends that mail addressed to Keith Maydak should not be returned, as that name is not fictitious. Respondent alleges that he misunderstood the import of the Consent Agreement due to his minority, and that he believed that the Consent Agreement and Cease and Desist Order referred only to names other than his own.

The clear language of the Order and Consent Agreement does not support Respondent's interpretation. The terms of the Cease and Desist Order, by which Respondent agreed to abide (Consent Agreement, para. 3) required Respondent to cease and desist from engaging in any scheme or device for obtaining money or property through the mail, in any manner involving misrepresentation of Respondent's identity, employment status or credit history. It is clear that a false representation of Respondent's employment status alone, regardless of the name used, is sufficient to constitute a violation of the terms of the Cease and Desist Order and therefore the Consent Agreement.

Respondent's statement that the applications did not result in the issuance of credit cards is not relevant to the issue of whether he engaged in a scheme or device to obtain money or property through the mail. It is not necessary for such a scheme to be successful in order for it to violate the terms of the Consent Agreement. Respondent agreed to discontinue submitting the applications (Consent Agreement, para. 3), and it is his activities, not the results of those activities, that are at issue here.

Respondent finally contests the issuance of the requested False Representation Order because it could affect mail which is not related to the scheme involved in this proceeding. Respondent appears to suggest that the Postal Service should be required to prove that each piece of mail detained and returned to sender is connected with the scheme.

The Consent Agreement explicitly provides that a breach of the Consent Agreement will "warrant the issuance by the Judicial Officer of an order of the type described in 39 U.S.C. § 3005 (a)(1) and (2) . . . against any name(s) and address(es) to which the alleged violator(s) seek the remittance of money or property through the United States mails." (Consent Agreement, para. 6.) Under the terms of the False Representation Order sought in the Petition, all mail which can be determined by reference to the face of its wrapper to be unrelated to the activity covered by the Order is to be delivered to the addressee in accordance with normal delivery procedures. All other mail is held for at least 48 hours to allow the addressee to open and inspect the detained mail, in the presence of the postmaster or a postal employee designated by the postmaster, and to obtain any mail not connected with the enterprise covered by the Order. These detention and inspection provisions are specifically designed to protect Respondent's interest in receiving mail which is unrelated to the challenged scheme.

While the detention and inspection requirements of the False Representation Order may cause some inconvenience to Respondent, such inconvenience results from his conduct in resuming the activities which he agreed, and was ordered, to discontinue. Erwin Koltay d/b/a Telematic & Epson Precision Works, P.S. Docket No. 26/101 at 3 (PSD Sept. 29, 1989), M.K.S. Enter., Inc., P.S. Docket No. 5/121 at 4 (PSD June 21, 1977). Accordingly, Respondent has shown no basis for challenging the issuance of the Order sought in the Petition.

CONCLUSION

All of Respondent's arguments have been considered and found to have no merit. Respondent has breached the terms of the Consent Agreement in the manner alleged in the Petition, and has not shown that the agreement is invalid. Accordingly, pursuant to the terms of that Consent Agreement, an Order of the type described in 39 U.S.C. § 3005(a) is being issued with this Decision.