Greenberg, Leo

Text (OCR of the scan at left; may contain errors)

IN THE MATTER OF LEO GREENBERG, TRADING AS BUREAU OF RESEARCH, RECLASSIFICATION DEPARTMENT, AND WILLIAM EDGAR SPICER COMPLAINT, FINDINGS, AND ORDER IN REGARD TO THE ALLEGED VIOLATION OF SEC. I> OF AN ACT OF CONGRESS APPROVED SEPT. 20, 1914 Docket -i810. Oomplaint, .Aug. 12, 1942-Decislon, .Apr. 22, 1943 Where an individual, engaged in interstate sale and distribution of printed mailing cards for use by collection agencies, merchants, and others in obtaining Information concerning their debtors, which consisted of two perforated cards to be used, as below described, in malllng on one a request for Information to the debtor or a person acquanted therewith, and In the supplying, on the other, of information pertaining to the debtor's affairs, for return to said individual's associate, as below set forth- (a) Represented, and placed in the hands of his customers a means of represent· ing to their debtors and others, that the request for information came from an agency or branch of the United States Government, through displaying on such cards the wot·ds "llureau of Research, Reclassification Drpartmcnt," along with the words "llond lluihling, Washington, D. C.," to which the in· formation cards were to be returneu; setting forth similar words and "Employment Division, Drpt. 303" on the request for information card, advising the debtor that the Bureau requested the information for the purpose of reclassifying his present employment, that all answers must be correct and returned within rs days, and that the classification "would be permanent untll new employment is secured"; and setting forth on the reverse side such matter as ''Present Classification No. D 0000," and under the words "Do Not Write llelow This Line"-precedcd by arrangement for full information as to the d<>btor's name, address, occupation, and employment-such words as "Reclassified as follows-Classification Number-and D~partment Signature"; and through similar cards to be st>nt to a person believed to have Information concerning the debtor;

The facts being that the request did not come from the Government but from private persons; srrld "llureau of Uesearth, Reclassification Department" was merely the trade name employed by said Individual; and "llond lluiluing, Washington, D. C." was the address of said associate; and Where said associate of snlu lndlvluual In the city of Wnl'h!ngton, to whom he client said cards for mailing and who, upon having the cards and information returned to him at said "Dureau of Research," Dond Dulldlng, Washington, D. C., forwarded the same to said individual, to be by him sent on to his customers with the information us to their debtors- ( b) Similarly falsely represented to such customers and debtors that the request for Information came from an agency or branch of the Government, and, through returning to said Individual Information concerning debtors, secured us aforesaid, assisted In the fruition of the purpose for which the original mlsrl•pt·espntatlon was made by Individual and his customers, and thus partldpated attlvely In tht• acts and practices in question; BUREAU OF RESEARCH RECLASSIFICATION DEPT, ET AL. 521 520 Complaint With tendency and capacity-notwithstanding ultimate Insertion of word "Independent" preceding "llureau'' on the reverse of the addressee side of the card by said Individual-to engender in the minds of a substantial number of persons the mistaken belief that the aforesaid cards emanated from the United States Government or some branch thereof, thereby Inducing such persons to give information which otherwise they might not have supplied: Held, That such acts and practices, under the circumstances set forth, were all to the prejudice of the public, and constituted unfair and deceptive acts and practices In commerce.

Before Mr. J. Earl Oox, trial examiner.

Mr. Randolph W. Branch for the Commission. Mr. Jerry Nemer, of Los Angeles, Calif., for Leo Greenberg, and along with- Mr. John Lewis Smith, of 'Vashington, D. C., for William Edgar Spicer.

Complaint Pursuant to the provisions of the Federal Trade Commission Act and by virtue of the authority vested in it by said act, the Federal Trade Commission, having reason to believe. that Leo Greenberg, individually, and trading as Bureau of Research, Reclassification Department, and 'Villiam Edgar Spicer,' an individual, hereinafter referred to as the respondents, have violated the provisions of said act, and it appearing to the Commission that a proceeding by it in respect thereof wolud be in the public interest, hereby issues its complaint stating its charges in that respect as follows: P ARAGRAPII 1. The respondent, Leo Greenberg, is an individual, who in the commission of the acts hereinafter alleged uses the name Bureau of Research, Reclassification Department, and who has his office and principal place of business at 215 'Vest Fifth Street in the city of Los Angeles, State of California. The respondent, William Edgar Spicer, is an individual, whose office and principal place of business·is located at 302 Bond Building, in the city of 'Vashington, District of Columbia.

PAn. 2. The respondent, Leo Greenberg, is now and for more than 6 months last past, has Lecn engaged in the business of selling printed mailing cards, Said respondent causes said cards when sold to be transported from his place of business in the State of California to purchasers thereof at their respective points of location in various other States of the United States and in the District of Columbia. Said respondent, Greenberg, maintains and at all times herein mentioned has maintained a course of trade in his said products in commerce between and among the various States of the United States and in the District of Columbia.

:528i13-43-vol. 36-:!6 Complaint SOF.T.O.

The said mailing cards sold and transported by the' respondent, Greenberg, as heretofore alleged, are designed and intended to be used by collection agencies, merchants, and others to whom they are sold in obtaining information concerning the purchasers' debtors and are of two types. One type on which a capitalletted "D" is printed, is used when the debtor himself is addressed; the other type on which a capital letter "R" is printed is used when some person other than the debtor is requested to give information. Said mailing cards are made up of units composed of two cards separated by a perforated line, designed to enable the addressee of one of the two cards, here· inafter referred to as the debtor card, to detach the other card, hereinafter referred to as the information card, which is self. addressed, and thereon give certain information requested on the card addressed to him. The debtor card is addressed to the debtor at his last known address or to someone likely to have information concerning him, by the creditor or collection agency or other pur· chaser of the cards. The unit composed of two cards is then for· warded to the respondent, 'William Edgar Spicer, at his said place of business in the city of 'Vashington, District of Columbia, and is mailed to him from the city of Washington, District of Columbia, to the person and to the address placed on the debtor card by the pur· chaser. 'Vhen the debtor or other informant responds to the request for information contained on the debtor card, he detaches the in· formation card and mails it with the information requested. Said information card has already been previously addressed to "Bureau of Research, Reclassification Department, Bond Building, Suite 302, 'Vnshington, D. C." Said information card so addressed is delivered by the Post Office Dl.'partment to respondent, Spicer. Said Spicer then forwards the information card with the information thereon supplied from 'Vashington, D. C., to respondent, Greenberg, in Los Angeles, Calif. Respondent, Greenberg, then returns the information card and the information so forwarded to the original purchaser of the cards.

PAn. 3. The respondent, Leo Gre£'nberg, in the course of his said business and for the purpose of inducing the sale of his said products, causes the said mailing cars transported by him as heretofore all£'ged, to be pr£'parcd and printed in the manner hereinafter set forth. The said type of cards bearing a capital Jeter "D," in the upper left hand corner of the address side of the debtor card, contains the follow· ing return address:

Dun•nu of nesenrch lleclnsslflcntlon Department Dond Dulldlng Washington, D. a BUREAU OF RESEARCH RECLASSIFICATION DEPT. ET AL. 523 Complaint The reverse side of the said debtor card contains the words: Bureau of Research Bond Building W nshlngton, D. C.

Employment Division Department. 301 . A{ _______________________________________________________________________ __ For the purpose of reclassifying your present employment this Bureau re- -quests you to answer all questions on the attached reply card. All answers must be correct and be returned within n period of five days. This classification will be permanent until new employment is secured. The information card is addressed as follows: Bureau of Research Reclassification DPpartment Bond, Building, Suite 302 Washington, D. C.

The reverse side of the information card reads as follows: PRESENT Classification No. DOOO Flll In Completely Print Clearly lrull Name ----------------------------------------------------------------- Address------------------ City------------------ State ------------------ Previous Occupation __ .,_______________ Present Occupation ------------------ Unskilled D Skilled D Clerical D Executive D Special Qualifications (Define any other types of worlt you may be qualified to do>------------------------------------------------------------------- Now employed by --~-----------------------------------------------------~ Address------------------ City------------------ State------------------ Do Not Write Dclow Thla Line Reclassified us follows Classitlc~tlon Number Dl'pnrtment Signature The said type of card bearing a capital letter "R" is in all respects substantially the same as heretofore allegeu except that the side of the debtor card opposite the address reads as follows: Bureau of Research, nond Building, Washington, D. C.

Employment Division Department 301 This Bureau Is advised that you can verify certain employment qualifications of --------------------------------------------------------------------------- For the purpose of reclassifying his or her proper employment rcdasslficatlon. AU answers must be correct and be returned within five days. This classification will be permanent until new employment is secured. 524 FEDERAL TRADE CO!aflSSION DECISIONS Complaint 36F. T. 0.

By the use of the aforesaid mailing cards prepared and printed as aforesaid the respondent, Leo Greenberg, falsely represents and places in the hands of his customers a means of falsely representing to said customers' debtors and others to whom said cards are addressed by said customers that the request for information comes from an agency or branch of the Government of the United States. The respondentr Spicer, by mailing the said cards to the debtor-addressees, or other persons from whom information is requested-makes the same representation and by returning to the respondent, Greenberg, the information obtained from debtors or other infonnants assists in the fruition of the purpose for which the original misrepresentation was made by respondent, Greenberg, and his customers and in so doing is guilty of an unfair and deceptive net and practice in commerce among and between the various States of the Uniteu States. The said representation is false and misleading. In truth and in fact neither the request for information nor the said mailing cards come from the Governml'nt of the United States or any branch or agency thereof, but are the device of private persons anu agencies used for the purpose of obtaining infonnation for their own uses. Many persons who receive the aforesaid mailing cards, which request information, believe said mailing cards come from the Government of the United States or from some branch or agency thereof and by reason of such belief give information which they would not otherwise supply. Many agencies of the Government of the United States distribute, and for some time past have distributed, vocational questionnaires similar to those used by respondents. Such questionnaires are and have been distributed by the Selective S<>rvice System among others. Among the persons receiving said mailing cards and requests for information· are many subject to the provisions of the Selective Service and Training Act of 1940 as amended, who believe that, or are doubtful as to whether, said mailing cards and requests for information have been sent to them under the provisions of said act. As a result of such beliefs and such doubts, many inquiries, both in person and by mail, are addressed to the local boards and other divisions of said Selective Service System and correspond· ence and other effort on the part of the various divisions of said Selective Service System, the Army of the United States and other governmental divisions and agencies are made necessary. PAn. 4. The aforesaid nets and practices of responllents as herein nll<'ged are all to the prejudice and injury of the public and of the United States Government and .constitute unfair and deceptive acts and practices in commerce within the intent ntHl m<'nning of the Federal Trade Commission Act.

BUR~AU OF RESEARCH RECLASSIFICATION DEPT. ET AL. 525 .520 Findings REPORT, FINDINGS AS TO THE FACTS, AND ORDER Pursuant to the provisions of the Federal Trade Commission Act, the Federal Trade Commission on August 12, 1942, issued and subsequently served its complaint in this proceeding upon the respondents, Leo Greenberg, individually, and trading as Bureau of Research, Reclassification Department, and "William Eugar Spicer, individually, charging them with the use of unfair and deceptive acts and practices in commerce in violation of the provisions of that act. After the filing of respondents' answers to the complaint, a stipulation as to the facts was entered into between respondent, Leo Greenberg, through his attorney, and Richnrd P. 'Vhiteley, A'lsistant Chief Counsel for the Conimission, which provided, subject to the approval of the Commission, that the statement of facts set"forth in such stipulation might be made a part of the record: herein and might be taken as the facts in this proceeding in lieu of evidence in support of or in opposition to the charge stated in the complaint, insofar as such charges related to respondent Greenberg. The stipulation provided further that the Commission might proceed upon such statement of facts to make its report as to respondent, Greenberg, stating its findings ns to the £acts (including inferences which it might draw from the stipulated facts) and its conclusion based thereon, and enter its order disposing of the proceeding as to respondent, Greenberg, without the presentation of argument or the filing of briefs.

Subsequently, at a hearing held before a trial examiner of the Commission theretofore duly designated by it, respondent, 'Villiam Edgar Spicer, through his attorney, joined in the stipulation theretofore entered into by respondent, Leo Greenberg, nml the Assistant Chief Counsel for the Commission, and waived any further proceedings, inclu(ling the taking of testimony, the filing of brief'>, and the presentation of oral argument.

Thereafter, the proceeding came on for final hearing before the Commission upon the complaint, the answers thereto, and the stipulation as to the facts (such stipulation having been approved and accepted by the Commission); and the Commission, having duly consi~lered the matter and being now fully advised in the premises, finds that this proceeding is in the intert'st of the public and makes this its findings as to the facts and its conclusion based thereon. Jo'INDINOS AS TO THE }'ACTS PARAGRAPH 1. Respondent, Leo Greenberg, is an individual, who in the course of his business hereinafter described, uses the name "Bureau of Research, Reclassificntion Departnwnt," and has his office Findings 86F.T.O.

and principal place of business at 215 West Fifth Street, in the city of Los Angeles, State of Califor;nia. Respondent, William Edgar Spicer, is an individual, whose office and principal place of business is located at 302 Bond Building, city of Washington, District of Columbia. PAR. 2. Respondent, Leo Greenberg, is now and for more than 6 months last past has been engaged in the business of selling printed mailing cards. Said respondent causes his cards, when sold, to be transported from his place of business in the State of California to purchasers thereof at their respective points of location in various other States of the United States and in the District of Columbia. Respondent Greenberg maintains, and at all times mentioned herein has maintained, a course of trade in his products in commerce between and among the various States of the United States and in the 'District of Columbia.

The mailing cards sold and transported by the respondent, Greenberg, as stated herein, are designed and intended to be used by collection agencies, merchants, and others to whom they are sold in obtaining information concerning the purchasers' debtors, and are of two types. One type, on which a capital letter "D" is printed, is used when the debtor himself is addressed; the other type, on which a capital letter "R" is printed, is used when some person other than the debtor is requested to give information. The mailing cards are made up of units composed of two cards separated by a perforated line, designed to enable the addressee of one of the two cards (hereinafter referred to as the debtor card) to detach the other card (hereinafter referred to ns the information card), -which is selfaddressed, nnd thereon give certain information requested on the card addressed to him. The debtor card is addressed by the creditor, collection agency, or other purchaser of the cards to the debtor at his last known address, or to someone likely to have information concerning him. The unit composed of two cards is then forwarded to the respondent, 'Villiam Edgar Spicer, at his place of business in the city of 'Vashington, District of Columbia, and is mailed by him from the city of 'V ashington to the person and to the address placed on the debtor card by the purchaser. The cards are uniformly sent through regular United States mail, with postage stamps attached, and at no time has any Government frank or any marking simulating such n frank been used.

'Vhen the debtor or other informant responds to the request for information contained on the debtor card, he fills in the blank spaces on the information card, detaches such card from the debtor card and mails it to the address given thereon, to-wit, "Bureau of Research, BUREAU OF RESEARCH RECLASSIFICATION DEPT. ET AL. 527 520 Findings Reclassification Department, Bond Building, Suite 302, Washington, D. C.," such address having previously been placed· on the card by respondent, Greenberg. In due course the information card is delivered by the Post Office Department to respondent, Spicer, who then forwards the card from \Vashington, D. C., to respondent, Greenberg, in Los Angeles, Calif. Respondent, Greenberg, then returns the information card and the information so forwarded to the purchaser o£ the card.

PAR. 3. Respondent, Greenberg, in the course and conduct o£ his business, causes the mailing cards to be prepared and printed in the manner hereinafter set forth. The type of card bearing a capital letter "D" contains the following return address in the upper lefthand corner of the address side o£ the debtor card: Bureau of Research Reclassification Department Bond Building Washington, D. C.

The reverse side o£ the debtor card. contains the following: B'L"RRA U OF RESEARCII' .

Bond Building Washington, D. C.

Employment Division Department 301 11------------------------------------------------------------------------- For the purpose of reclassifying your present employment this Bureau requests you to answer all questions on the attached reply curd. All answers must be correct and be returned within a period of five days. This classification will be permanent until new employment is secured. The information card is addressed as follows: Bureau of Research Reclnssitlcntlon Department Bond Building, Suite 302 Washington, D. C.

The reverse side of the information card reads as follows: Present CLASBIFIOATION No. D 0000 Fill in Completely Print Clearly Full Name----------------------------------------------------------------- Address----------------- City------------------ State _________________ _ Previous Occupation-------------------Present Occupation _________________ _ Unskilled 0 Skilled 0 Clerical 0 Executive 0 Special Qunlitlcatlons (Define any other types of work you may be qualified to do) 528 FEDERAL TRADE COJ.\IMISSION DECISIONS Findings 36F.T.O.

Now employed by----··------------------------------------------------------ Address-------------------City--------------------State ___________________ _ Do Not Write Below This Line Reclassified as follows------------------------------------------------------ Classiftcatlon Number ------------------------------------------------------- Department Signature------------------------------------------------------- The type of card bearing a capital letter "R" is in all respects substantially the same as hereinabove set forth, except that the side of the debtor card opposite the address reads as follows: DURF:AU OF RESE,\RCH, RECLASB!FIC.\TION DEPT. Don<l Duilding Washington, D. C.

Employment Division DPpartment 301 This Bureau Is advised that you can verify certain employment qualifications of. _________________________________ for the purpose of re-classifying bis or ber proper employment re-classification.

This classification will be permanent until new rmployment Is secured. PAn. 4. By the use of these mailing cards, prepared and printed as set forth above, respondent, Greenberg, represents and places in the hands of his customers a means of representing to such customers' debtors and others that the request for information comes from any agency or branch of the Government of the United States. In truth and in fact, such request for information docs not come from the Government of the United States or any branch or agency thereof, but is a device employed by private persons and agencies for their own use. The Commission therefore finds that such representation is false and misleading.

PAn. 5. Respondent, Spicer, by mailing the cards to the debtoraddresses or other persons from whom information is requested, makes the same representation and, by returning to respondent, Greenberg, the information obtained from debtors or other informants, assists in the fruition of the purpose for which the original misrepresentation is made by respondent, Greenberg, and his customers. Respondent, Spicer, thus participates actively in the acts and practices herein described.

P.an. 6. Respondents' acts and practices have the tendency and capacity to engender in the minds of a substantial number of persons the erroneous and mistaken belief that the aforesaid cards emanate from the Government of the United States or from some branch or agency thereof, and tho tendency and capacity to cause such persons, by reason thereof, to give information which otherwise they might not supply.

BUREAU OF RESEARCH RECLASSIFICATION DEPT. ET AL. 529 520 Order Prior to the time when the matter was taken up with respondent Greenberg by investigators of the Federal Trade Commission, respondent, Greenberg, changed the cards to the extent of inserting the word "Independent' immediately before the word "Bureau" on the reverse of the addressee side thereof. The Commission finds, however, that this change did not alter the cards in any material respect, and that it was wholly insufficient to correct the false and misleading impression created by the cards and by the methods employed by respondents.

CONCLUSION The acts and practices of the respondents as herein found are all to the prejudice of the public and constitute unfair and deceptive acts and practices in commerce .within the intent and meaning of the Federal Trade Commission Act.

ORDER TO CEASE AND DESIST This proceeding having been heard by the Federal Trade Commission upon the complaint of the Commission, the answers of respondents, and a stipulation as to the facts entered into between respondents and Richard P. Whiteley, Assistant Chief Counsel for the Commission (such stipulation having been approved and accepted by the Commission); and the Commission having made its findings as to the facts and its conclusion that the respondents have violated the provisions of the Federal Trade Commission Act. It i8 ordered, That the respondents, Leo Greenberg, individually, and trading as "Bureau of Research, Reclassification Department," or trading under any other name, and William Edgar Spicer, and their agents, representatives, and employees, directly or through any corporate or other device, in connection with the offering for sale, sale, and distribution in commerce, as "commerce" is defined in the Federal Trade Commission Act, of respondents' mailing cards or any other printed or written material of a substantially similar nature~ do forthwith cease and desist from:

1. Using the words "Bureau of llesearch, Reclassification Department," alone or in connection or conjunction with any other word or words, to designate, describe, or refer to respondents' business; or otherwise representing, directly or by implication, that respondents' business has any connection with the United States Government, or . that the information sought by respondents or their customers is for the use of the United States Government or any branch or agency thereof.

Order 36F.T.C.

2. Representing, directly or by implication, that the information sought through respondents' mailing cards or other material is for the purpose of classifying or reclassifying any person with respect to employment.

3. Using, or placing in the hands of others for use, mailing cards or other material which represent, directly or by implication, that respondents' business is other than that of obtaining information for use in the collection of debts, or that the information sought through such cards or other rna terial is for any purpose other than for use in the collection of debts.

It is further ordered, That the respondents shall, within 60 days after service upon them of this order, file with the Commission a report in writing, setting forth in detail the manner and form in which they have complied with this order.

POW-A-TAN MEDICINE CO. 531 Complaint