Opinion
No. GCA 81-0023.
May 29, 1981.
Clark C. Evans, U.S. Postal Service, Memphis, Tenn., Lyndia P. Kent, Asst. U.S. Atty., Northern Dist. of Florida, Tallahassee, Fla., for plaintiff.
Grafton B. Wilson, II, Gainesville, Fla., for defendant.
MEMORANDUM OPINION
Title 39, United States Code, Section 3005(a), allows the Postal Service to return mail to the sender if it finds the recipient of the mail "is engaged in conducting a scheme or device for obtaining money or property through the mail by means of false representations . . . ." The Postal Service alleges Ms. Stimpson is conducting a scheme for obtaining money through the mail by means of false representations and has sued under Title 39, United States Code, Section 3007(a), for a preliminary injunction directing the detention of the Defendant's incoming mail by the Postmaster pending the conclusion of the administrative proceeding. The plain words of Section 3007(a) require only "a showing of probable cause to believe" Section 3005 is being violated in order to obtain a preliminary injunction. United States Postal Service v. Beamish, 466 F.2d 804 (3d Cir. 1972). The reference in Section 3007 to Federal Rule of Civil Procedure 65 "intends merely to delineate the procedural mechanics applicable to the hearing on probable cause, the notice requirements and the form of the order." Id. at 806.
The hearing in this case was originally billed as a hearing on a petition for a temporary restraining order. The Defendant had adequate notice, four days, of the hearing. Consequently, with the Postal Service's approval, the hearing will be treated as a hearing on a motion for preliminary injunction.
To prevail the Postal Service must establish probable cause to believe Ms. Stimpson "is engaged in conducting a scheme or device for obtaining money or property through the mail by means of false representations . . . ." 39 U.S.C. § 3005(a). Probable cause is a familiar phrase in the law's lexicon. It has been judicially interpreted since the adoption of the Fourth Amendment. A finding of probable cause may rest upon evidence which is not admissible in a trial. Purely conclusory allegations, however, will not do. United States v. Ventresca, 380 U.S. 102, 85 S.Ct. 741, 13 L.Ed.2d 684 (1965). Probable cause consists of facts and circumstances based upon reasonably trustworthy information which are sufficient to justify a person of reasonable caution believing that an act has occurred or is about to occur. United States v. Preston, 608 F.2d 626 (5th Cir. 1979). See also, United States v. Johnstone, 574 F.2d 1269 (5th Cir. 1978) (mere suspicion does not constitute probable cause); Alsop v. Lidden, 130 Ala. 548, 30 So. 401 (1901) (the facts must be ones which would justify reasonable and cautious people in believing an act has been committed by a specified person).
The Postal Service relies primarily upon Ms. Stimpson's classified advertisement and follow-through brochure as probable cause showing her use of a scheme to obtain money through the mail by means of false representations. The ad and the brochure are appended to this opinion. The ad simply gives an address to write for information about earning money processing mail at home. The follow-through brochure which promises to pay a participant $.60 for each envelope secured, stuffed with Ms. Stimpson's circulars, and submitted to her according to her instructions. It speaks in glowing, optimistic terms of the financial and personal rewards available. A $25.00 deposit is required for the instructions. The final paragraph exhorts the reader to start now because the quota for mailers may soon be filled.
The Postal Service has alleged and attempted to prove probable cause that four representations are false: (1) immediate participation and reward, without further substantial financial investment; (2) only a limited number of persons will be selected to participate; (3) principal requisites for the participant's earning significant compensation are only payment of the deposit and stuffing of the circulars into the envelopes; (4) earnings are primarily determined by the amount of time participants devote to the enterprise. The Postal Service has not shown probable cause that any of these statements are false.
Ms. Stimpson's system as detailed in the extensive booklet provided those who ante up the $25.00 deposit requires a participant to place classified advertisements asking newspaper readers to send for information about earning money compiling mailing lists or typing at home. The Postal Service has not presented evidence indicating the additional costs of the classified advertisement would be substantial. It in fact relies upon Ms. Stimpson's estimate of $10.00 weekly advertising cost which could not be deemed substantial especially since the Postal Service has presented no evidence tending to show the rewards for diligent envelope stuffers will not be as touted.
The brochure's final teaser urging readers to join immediately because the quota for mailers may be filled is of a sort commonly seen in many advertisements. The statement is not phrased so that it would reasonably lead a reader to believe the limit upon participation is significant.
The Government has also not shown probable cause that the payment of the deposit and envelope stuffing are not the major prerequisites to success in their enterprise. And it has not established probable cause that diligence on the part of participants would not result in significant rewards. It in fact presented no evidence showing Ms. Stimpson's system does not deliver the promised rewards.
In fact the Government's evidence indicates Ms. Stimpson may have many happy customers. Ms. Stimpson is presently receiving approximately 84 pieces of mail a day. In the past month the Postal Service has received 36 inquiries about her operation. Thirty-six inquiries out of approximately 2,520 mailings is a very low complaint ratio. The Government has certainly not presented evidence indicating the ratio is abnormally high.
The Government's failure to show probable cause in this case is dramatized by comparison to cases where probable cause has been found. For instance, in United States Postal Service v. Peak Laboratories, 389 F. Supp. 228 (N.D.Ga. 1975), the showing of probable cause included evidence that "FAT OFF" advertised as, among other things, causing a 30% decrease in the average cholesterol level of the average person and actually dissolving fat, would have no noticeable effect upon a person's cholesterol level or obesity. The Postal Service showed in United States Postal Service v. Oriental Nurseries, 491 F. Supp. 1265 (S.D.Fla. 1980), that a tree advertised as growing up to 14 feet in one season and 23 feet in two years would grow to 12 feet in one season in only the most extraordinary of occasions. That kind of evidence establishes probable cause of a scheme to defraud.
In this case the Government has not shown probable cause of a scheme to defraud. Its motion for a preliminary injunction has therefore been denied.
APPENDIX EXHIBIT A
GOOD PAY working from home, processing mail for us. No experience required. Part or full time. Start immediately. For info, and application send SASE to: Colfax Publications, Box 1135, Newberry, Florida 32669. 1-22-6t
EXHIBIT B WE'LL PAY YOU 60¢ PER ENVELOPE STUFFED and submitted to us according to our instructions!!
Dear Friend:NOW! As an independent mailer working with us YOU could earn BIG MONEY and respect in your own mailing business, substantially consisting of SIMPLE — PLEASANT — PROFITABLE STUFFING — MAILING PREADDRESSED STAMPED ENVELOPES at home! Use your kitchen table or a small desk in any corner of the home to do everything that is required.
WE'LL PAY YOU 60¢ FOR EACH AND EVERY ENVELOPE YOU SECURE, STUFF WITH OUR CIRCULARS AND SUBMIT TO US ACCORDING TO OUR INSTRUCTIONS! Not a commission based on whether or not you get orders, but simply 60¢ for each and every envelope!
Send us 25 — we'll send a check for $15.00; send us 100 — we'll send a check for $60.00; send us 500 — we'll send a check for $300.00 and on and on!! We also reimburse your cost of mailing envelopes to us! Never before anything quite like this!INDEPENDENCE!! PRESTIGE!! FINANCIAL GAIN!! BE YOUR OWN BOSS — YET — BE under our guidance and instruction!
You need NO special skills. We will teach you — in simple language how you can start making money and continue day after day, week after week, year after year. Individuals anywhere are welcome to do this easy and pleasant work from the comforts of home!
YOUR name never appears on any of the printed circulars. You will never stuff anything objectional or pornographic. Our circulars sell a clean, honest book on how to start a certain type of home business.WHY DO WE NEED YOUR IMMEDIATE HELP? Answer: There are millions of people in the United States and Canada that we would like to send our offers to, but we could never be expected to reach all of them even if we worked around the clock. However, by you and many others helping us from home by locally securing pre-addressed, stamped envelopes by mail from people in your own area or all over the country, we are able to contact many thousands of potential prospects at a shorter time. How you would go about receiving the envelopes will be explained to you in complete detail when you receive our easy to understand program.
OUR SYSTEM OF STUFFING ENVELOPES IS VERY EASY TO OPERATE! You will not be required to buy any envelopes or postage stamps. We will gladly furnish all circulars without charge for as long as you wish to participate. By following our instructions you will receive pre-addressed envelopes with postage already affixed. As you can see the biggest part of your work will be securing envelopes, stuffing them with our circulars and sending them to us for payment. We want you to work with us! We also want you to be happy and remain active for many years in this terrific program.
WHY DO WE GLADLY PAY YOU SUCH A HIGH AMOUNT AS 60¢ PER ENVELOPE? Answer: Because we want to be assured of paying you more than enough to cover your small expense involved in receiving the envelopes, plus leave you with a large profit besides. We want to be certain you make good money so you can enjoy your work and stick with it for many years. Since we'll make good money through your efforts, we are only too glad to pay you 60¢ per envelope and see that you earn good profits from the comforts of home. There are no quotas set on the amount of stuffed envelopes you can submit. You can send as many as you are able to send and you have our assurance that you will definitely be paid promptly no less than 60¢ for each envelope submitted, and your cost of mailing them to us will be fully reimbursed and added to your checks.
IN ORDER TO GET YOU STARTED IMMEDIATELY, we must require that you send a good faith deposit of only $25.00 for instruction material. This deposit assures us that you are serious about wanting this kind of work and will follow our instructions. Your deposit will be returned after submitting as little as 200 envelopes. In as much as we would like to send you our program without requiring the small deposit, we must do so to protect ourselves from those few who are not serious and have no intention other than to satisfy their own curiosity. Naturally, no business can afford to send costly material to everyone who writes in asking for it.
START NOW by mailing the following request form IMMEDIATELY, and start taking those first important steps on the road to working from the comforts of your own home! Don't put off another minute because our quota for mailers may soon be filled. All requests must include the full amount of remittance. You may send check, cash or money order.
Yours for a rewarding FUTURE,
MAIL THIS BLANK TODAY
N. STIMPSON, 225 S.W. 91st Street, Gainesville, FL. 32601
Enclosed is my $25.00 deposit. Please enter me into your program and rush starting instructions. I understand that you are not selling me a business opportunity, but rather requiring a good faith deposit to show my sincerity. It is understood that my deposit will be returned after I have secured, stuffed and submitted at least 200 envelopes according to your instructions.
NAME __________ ADDRESS ____________________
(Please print clearly)
CITY __________ STATE __________ ZIP CODE __________
YOUR SIGNATURE ____________________ DATE __________
Absolutely no part of this letter may be copied in whole or part without prior written permission from the copyright holder. (c) Copyright 1978.