In The Matter of the Complaint Against                  )
                                                                               )
AMERICAN PUBLISHING SERVICES                       )
YELLOW PAGE DIVISION                                       )
2745 Winnetka Ave., N.                                         )
Suite 148                                                                )
              at                                                              )
New Hope, MN 55427-2830                                   )
                                                                               )
                 and                                                        )
                                                                               )
DAVID ALLEN ZOVATH                                         )
ELLEN ZOVATH                                                     )
102 N. Lakeside Dr.                                               )
                   at                                                         )
Kennesaw, GA 30144-3091                                  )  P.S. Docket No. 34/191

APPEARANCE FOR COMPLAINANT                      Daniel S. Bryant, Esq.
                                                                              Consumer Protection Division
                                                                              United States Postal Service
                                                                              475 L'Enfant Plaza, SW
                                                                              Washington, DC 20260-1147

APPEARANCE FOR RESPONDENT                        Arthur A. Moure, Esq.
                                                                               Plummer & Farmer
                                                                               3000 Smith Street
                                                                               Houston, TX 77006-3486

POSTAL SERVICE DECISION ON
PETITION FOR SUPPLEMENTAL ORDERS

The General Counsel of the United States Postal Service, (Complainant), has filed a Petition For Supplemental Orders (Petition) alleging that David Allen Zovath (Respondent) is evading or attempting to evade the provisions of False Representation Order No. 89-110 and Cease and Desist Order No. CD-2778 by seeking remittances through the mail for business listings in yellow page telephone directories using solicitations similar to those previously found to violate 39 U.S.C. §§3001(d) and 3005. In accordance with 39 C.F.R. §952.30, Complainant requests that a supplemental false representation order be issued against the names and addresses currently being used by Respondent. Respondent has filed an Answer in which he denies the allegations of the Petition and requests an evidentiary hearing.

BACKGROUND

Complainant originally initiated this proceeding by filing a Complaint alleging that Respondent was 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. Specifically, Complainant alleged that Respondent distributed solicitations for listings in yellow page directories that were non-mailable under 39 U.S.C. §3001(d) and contained the following materially false representations in violation of 39 U.S.C. §3005:

(a) The addressee has previously authorized a business listing in Respondent's telephone directory;

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

(c) Respondent is a part of or affiliated with the telephone company servicing the recipient's area;

(d) Respondent is the publisher of the business to business phone directory or "yellow pages" customarily supplied to business telephone subscribers in the recipient's area;

(e) The area of distribution of Respondent's directory will encompass all business telephone subscribers in the "region";

(f) Publication and distribution of Respondent's directory will take place in accordance with time frames customary to the authorized "yellow pages" industry publication and distribution standards.

After a hearing at which both parties presented evidence, an Administrative Law Judge issued an Initial Decision in which he concluded that Respondent's solicitations were nonmailable under 39 U.S.C. §3001(d), Respondent made all of the representations alleged in the Complaint, and the representations alleged in paragraphs (a) - (e) were materially false.⁽¹⁾ Respondent did not file an appeal from the Initial Decision, and on December 27, 1989, the Initial Decision became the Final Agency Decision and False Representation Order No. 89-110 and Cease and Desist Order No. CD-2778 were issued.

FINDINGS OF FACT

1. Subsequent to the issuance of the Initial Decision and the accompanying False Representation and Cease and Desist Orders, Respondent distributed solicitations which are virtually identical to his previous solicitations (Petition for Supplemental Orders, Exhibits (Exhs.) 1 & 18). The solicitations seek the remittance of money to the following names and addresses: International Publishing Yellow Page Division, 2443 Fillmore Street, Suite 199, San Francisco, CA 94115-1825 (Exhs. 4b-d & 5); International Publishing Services Yellow Page Division, 2425 B Channing Way, Suite 704, Berkeley, CA 94704-2209 (Exhs. 8b-g); International Publishing Services Yellow Page Division, 7902 Gerber Road, Suite 272, Sacramento, CA 95828-4300 (Exhs. 11b, 12c-f, 13b & 15d-f); International Publishing Yellow Page Division, 323 East Matilija Street, No. 110-102, Ojai, CA 93023-2740 (Exhs.19b & 20b-c); International Publishing, 25825 104th Avenue SE, Suite 360, Kent, WA 98031-7698 (Exhs. 26c-d); International Publishing Yellow Page Division, 7605 Santa Monica Boulevard, Suite 635, West Hollywood, CA 90046-6408 (Exh. 16b); American Publishing Services, 7605 Santa Monica Boulevard, Suite 635, West Hollywood, CA 90046-6408 (Exhs. 18 & 18a).

2. The most prominent features of Respondent's original solicitation, (Exh. 1, 18, CX-2, 5A & 5B),⁽²⁾ the walking fingers logo, the term Yellow Pages, a copy of the recipient's yellow page listing which was cut from the local telephone company yellow page directory and pasted on Respondent's solicitation (see Attachment A & Exh. 4a), and a map, are identical to the features included on Respondent's current solicitations.⁽³⁾

3. The primary difference between the current and former solicitations is the placement of the many phrases included on both advertisements. In addition, the color of the paper on which the solicitations are printed has been changed from white to yellow, and a disclaimer⁽⁴⁾ which was formerly in black ink stamped over the signature lines is now printed on the solicitation in blue ink under the stated charge for the listing. While there are additional differences, they are minor and do not establish that the overall impression created by Respondent's current solicitations differs from the overall impression created by his prior solicitations.

DISCUSSION

The issue raised by a petition for supplemental order is whether a person is evading or attempting to evade the provisions of a previously issued false representation order or cease and desist order by conducting the same or similar enterprise under a different name or at a different address.⁽⁵⁾ A hearing on the issues raised by a petition will be held only upon a showing of good cause⁽⁶⁾ which has been consistently interpreted as the existence of a genuine issue of material fact.⁽⁷⁾ Although Respondent requested a hearing, he has not shown that a genuine issue of material fact exists in this case. Accordingly, Respondent's request for a hearing is denied.

Respondent does not dispute that he is responsible for the distribution of the solicitations using the names and addresses alleged in the Petition. Respondent also does not deny that he is subject to the false representation and cease and desist orders previously issued. However, Respondent contends that he made significant changes to his solicitations in direct response to the Administrative Law Judge's Initial Decision, and that the current solicitations do not violate either 39 U.S.C. §§3001(d) or 3005.

The solicitations themselves are the best evidence of their contents. Neither lay nor expert testimony is necessary to establish whether the solicitations make the representations alleged in the Petition or the effect of those representations on the ordinary reader.⁽⁸⁾ A comparison of Respondent's current solicitations with the solicitations which supported the issuance of the false representation order and cease and desist order, establish that Respondent continues to make the representations previously found to be false. Despite the minor rearrangement of phrases, change in the color of paper⁽⁹⁾ and ink, and the addition of the disclaimer concerning affiliation with a telephone company,⁽¹⁰⁾ the overall impression conveyed to the ordinary reader⁽¹¹⁾ by the current solicitations is the same as the impression conveyed by the prior solicitations.

Respondent claims that he does not make the alleged representations because the walking fingers logo and the words yellow pages, which the Administrative Law Judge found contributed to the false impression, are not copyrighted and do not suggest an affiliation with a telephone company.⁽¹²⁾

Although it is true the words yellow pages and the walking fingers logo are not protected by either copyright or trademark law and Respondent is free to use them, he is not free to use them in a manner that confuses the ordinary reader as to the nature and source of his product.⁽¹³⁾

Respondent additionally claims that his current solicitations do not violate §3005 because they include a 1-800 telephone number that connects to a recording which specifically informs callers that Respondent's publication is not affiliated with any telephone company. Respondent further contends that all of his advertised directories have in fact been published and any consumer who has ever requested a refund has received one. Even if each of these contentions is true, they do not support Respondent's position that no supplemental order should be issued. The listing of an 800 number does not alter the overall impression created by Respondent's solicitation and a consumer is not obligated to call the listed number in an attempt to verify the origin of a solicitation. In addition, Respondent's publication of the directories for which he solicits advertisements and his provision for refunds for consumers who request them do not establish that he is no longer making the representations previously found to be in violation of 39 U.S.C. §§3001(d) and 3005.

Respondent also contends his current promotional materials are not solicitations in the guise of bills, invoices, or statements of account due because they include a prominent disclaimer which complies with the requirements of 39 U.S.C. §3001(d) and Domestic Mail Manual (DMM) §123.41.⁽¹⁴⁾ Contrary to Respondent's contention, the disclaimer does not comply with the requirements of the statute or implementing regulation. The statute requires that the solicitations bear on their face in conspicuous and legible type a disclaimer that contrasts with the remainder of the printing on the solicitations in accordance with regulations prescribed by the Postal Service. The Postal Service regulations require that the disclaimer be displayed in conspicuous boldface capital letters of a prominently contrasting color at least as large, bold, and conspicuous as any other print on the face of the solicitation, but no smaller than 30-point type.⁽¹⁵⁾ While Respondent's disclaimer is in capital letters of a contrasting color, it is neither conspicuously displayed nor as large and bold as other print. Moreover, the disclaimer is in print smaller than the required 30-point type. Therefore, Respondent's current solicitations violate DMM §123.41 and 39 U.S.C. §3001(d).

CONCLUSION

Respondent is evading or attempting to evade the provisions of False Representation Order No. 89-110 and Cease and Desist Order No. CD-2778 by conducting the same or a similar enterprise using different names and addresses. Accordingly, the Petition for Supplemental Orders is granted and the additional False Representation Order requested by Complainant is issued with this Decision.

Jamres A. Cohen
Judicial Officer

1. The Administrative Law Judge found that Complainant had not proven that the representation alleged in paragraph (f) was false.

2. Complainant's Exhibits CX-2, 5A & 5B are original solicitations which were entered into evidence and considered in the Initial Decision. Exhibit 1 is a photocopy of one of Respondent's previous solicitations.

3. Photocopies of Respondent's current solicitations are included with Complainant's Petition for Supplemental Orders as Exhibits 4b-d, 5, 8b-g, 11b, 12c-f, 13b, 15d-f, 16b, 18a, 19b, 20b-c, 22c, 23a, 24b-c, 26c-d, 28a & 29b-c. An original solicitation is included as Exhibit 18.

4. The disclaimer reads, "This is not a bill. This is a solicitation. You are under no obligation to pay the amount stated above unless you accept this offer."

5. See 39 C.F.R. §952.30.

6. A showing of good cause is required because the parties were previously afforded a full opportunity to present evidence in support of their claims or defenses at a hearing held by an Administrative Law Judge prior to the issuance of the false representation and cease and desist orders. See 39 C.F.R. §952.7(a).

7. Scott David Wilcox, P.S. Docket No. 18/147 at 5 (P.S.D. April 20, 1988); Sammy Y. Ip, P.S. Docket No. 20/65 at 4 (P.S.D. Sept. 30, 1987); United States Testing Authority, P.S. Docket Nos. 14/77 & 14/114 at 8 (P.S.D. Oct. 2, 1985).

8. See Peak Laboratories, Inc. v. USPS, 556 F.2d 1387, 1389 (5th Cir. 1977); Charles Smith, P.S. Docket No. 37/180 at 17 (P.S.D. Jan. 31, 1994); Scott David Wilcox, P.S. Docket No. 18/147 at 6-7 (P.S.D. April 20, 1988); United States Testing Authority, P.S. Docket Nos. 14/77 & 14/114 at 15-16 (P.S.D. Oct. 2, 1985).

9. The change from white to yellow paper solicitations would tend to reinforce, rather than detract from, the impression that the solicitations were being distributed by the telephone company serving the recipient's area since business listings in the local directory are traditionally printed on yellow paper.

10. The disclaimer is not sufficiently prominent to dispel the overall impression that Respondent's solicitation is a renewal of an existing listing in the local telephone company yellow pages directory. See Charles Smith, P.S. Docket No. 36/129 at 14-15 (P.S.D. Dec. 9, 1993); National Scholastic Resources Admin., Inc., P.S. Docket No. 19/185 at 16 (P.S.D. July 10, 1986); New Generation, P.S. Docket No. 11/152 at 27 (P.S.D. May 13, 1983).

11. It is the overall impression created in the mind of the ordinary reader that determines whether the representations are made in the solicitations. See Donaldson v. Read Magazine, Inc., 333 U.S. 178 (1948); Borg-Johnson Electronics v. Christenberry, 169 F. Supp. 746 (S.D.N.Y. 1959); Vibra-Brush Corp. v. Schaffer, 152 F. Supp. 461 (S.D.N.Y.1957) rev'd on other grounds 256 F.2d 681 (2nd Cir. 1958); Charles Smith, P.S. Docket No. 36/129 at 10 (P.S.D. Dec. 9, 1993); Mid-American Marketing, Inc., P.S. Docket No. 24/12 at 7 (P.S.D. Jan. 5, 1987), aff'd, (May 7, 1987).

12. Respondent also contends that the walking fingers logo on his solicitations is not identical to the walking fingers logo used by the major telephone directory companies. Although there may be minor differences between logos, those differences are so slight that they would not likely be noticed by most ordinary readers.

13. See Charles Smith, P.S. Docket No. 36/129 at 8 (P.S.D. Dec. 9, 1993); Scott David Wilcox, P.S. Docket No. 22/111 at 4 (P.S.D. Aug. 31, 1989); Telco Directories Inc., P.S. Docket No. 22/111 at 9-10 (P.S.D. Feb. 25, 1989).

14. Effective July 1, 1993, the DMM was revised and §123.41 was renumbered as C0 31.1.2.

15. See DMM §123.41.