September 26, 1996
In the Matter of the Complaint Against
RUBY JUERGENS
4406 Towner N.E.
Albuquerque, NM 87110-3910
d/b/a
THE WORLDLIFE COMPANY
P.O. Box 30665
Albuquerque, NM 87190-0665
P. S. Docket No. 40/132
APPEARANCE FOR COMPLAINANT:
Jeannine H. Walter, Esq.
Civil Practice Section
Civil Practice SectionUnited States Postal Service
Washington, DC 20260-1147
APPEARANCE FOR RESPONDENT:
Jacob Laufer, Esq.
Bass & Ullman, P.C.
747 Third Avenue
New York, NY 10017-2875
POSTAL SERVICE DECISION ON BREACH OF AGREEMENT
CONTAINING CONSENT ORDER TO CEASE AND DESIST
On December 19, 1995, the General Counsel of the United States Postal Service (Complainant) filed a Petition alleging that Ruby Juergens, doing business as the WorldLife Company (Respondent), has breached the terms of an Agreement Containing Consent Order to Cease and Desist (Agreement), executed on June 9, 1993. According to Complainant, Respondent has resumed seeking remittances through the mail, using representations which she agreed to permanently discontinue.
On December 20, 1995, an Interim Detention Order, as authorized by paragraphs 6 and 7 of the Agreement, was issued directing the detention of mail addressed to the name and address to which the current solicitations seek remittances. The Interim Detention Order granted Respondent an opportunity to file a reply to the Petition. On January 30, 1996, Respondent filed a timely reply in which she denies she has breached the terms of the Agreement and opposes the issuance of the Orders sought in the Petition.
FINDINGS OF FACT
1. Complainant originally initiated this proceeding by filing a Complaint alleging that Respondent was conducting a scheme to obtain money or property through the mail by means of materially false representations within the meaning of 39 U.S.C. §3005 (1988 & Supp. II 1990). Specifically, Complainant alleged that Respondent distributed direct mail solicitations for a multi-vitamin product called Aslan GH-III Formula which was represented to be “[t]he World’s greatest anti-aging secret” as well as providing beneficial results for 36 listed physical conditions or diseases including heart disease and arteriosclerosis. The solicitation was in the form of a letter from an individual named Andrew Cego, representing a company called American Surveys in Austin, TX, but contained a return form and a self-addressed envelope by which consumers could purchase the Aslan GH-III Formula from Respondent, The WorldLife Company, Vitamin Shipping Center, Box 30665, Albuquerque, NM 87190-0665.
2. In response to the Complaint, Respondent filed an Answer, in which she denied making any of the representations alleged in the Complaint. Respondent also contended that the “direct mail solicitation . . . attached to the Complaint was not prepared by [her], nor disseminated by [her] or by third parties at [her] urging” but rather appeared to have been prepared by a book publisher to obtain sales of its book.
3. On June 9, 1993, Respondent, both individually and on behalf of WorldLife Company, entered into the Agreement which Complainant now contends Respondent has breached. In paragraph 3 of the Agreement Respondent agreed to “permanently refrain from using the promotional materials attached to the [C]omplaint and permanently refrain from the making of the representations alleged therein.” Under paragraph 6 of the Agreement a breach “by the Respondent or any party in privity with the Respondent, will warrant the issuance” of the orders authorized by 39 U.S.C. §3005.
4. In paragraph 5 of the Agreement Respondent consented to the issuance of the Cease and Desist Order attached to the Agreement, which was issued as Cease and Desist Order No. 3654 on June 17, 1993. The Cease and Desist Order, in Section III, “Conduct Prohibited,” directed Respondent to discontinue “falsely representing, directly or indirectly, in substance and effect, whether by affirmative statements, implications or omissions, that: (1) [a]ny dietary supplement, vitamin supplement or nutrient extract compound is a cure” for any of 32 listed conditions, including heart disease and conditions and arteriosclerosis, “and/or (2) [a]ny product is similar to the formulation of Gerovital tested by Dr. Anna Aslan,” unless Respondent “possess(es) reliable and competent scientific evidence” to substantiate the representations, or the representations have been approved by the Food and Drug Administration (FDA).
5. In Section II of the Cease and Desist Order the persons bound by the prohibitions of the Order are stated to be “Ruby Juergens individually or through any corporate or other device or name(s), her agents, employees, representatives, successors, and assignees (hereinafter collectively referred to as ‘Respondents’), and any persons who would be bound by an injunction issued against the Respondents pursuant to Federal Rule of Civil Procedure 65.”
6. Subsequent to the execution of the Agreement and the issuance of the Cease and Desist Order, advertisements soliciting remittances through the mail touting the benefits of oral chelation, “a nutritional program of reversing or improving atherosclerosis (hardening of the arteries),” were distributed by Alternative Medical Publishing, Inc., (AMP) and American Surveys. There are two versions of this solicitation, both of which are similar in format and text: The solicitations typically include 8 ½ x 14″ and 8 ½ x 11″ circulars addressed to consumers by name, using varying sized print interspersed with bold face type notifying the recipient that oral chelation is the bright hope for perfect health.
7. Both versions prominently represent that oral chelation therapy “OPENS YOUR ARTERIES AND FLUSHES PLAQUE OUT OF YOUR BODY! . . .so that you can enjoy a lifetime of permanent good health,” “FLUSHES OUT DEADLY PLAQUE! CLEANSES THE ENTIRE 75,000 MILES OF BLOOD VESSELS IN YOUR BODY,” and “FLUSHES ARTERIAL PLAQUE RIGHT OUT OF YOUR BODY!” Additionally, the solicitations repeatedly refer to oral chelation as a therapy, treatment, and/or remedy for both heart disease and other diseases and physical conditions. The solicitations also compare the benefits and side effects of oral chelation and heart bypass surgery while explaining that the medical profession earns billions of dollars annually from bypass procedures and therefore, does not promote oral chelation as a “powerful healer.”
8. Both solicitations advise readers that they can “obtain and blend an oral chelation mix at home” or they can purchase the same formula from
“a little company in Albuquerque called WorldLife. No claims are made by them for the product. But you’ll note that it is sold on a satisfaction or money back basis. Their exciting product is called AtheChel oral formula and a 30-day supply (180 tablets) cost me $29.95. I might tell you that I order toll-free 1-(800) 451-2194 from the WorldLife Company either by Visa, Mastercard, or Discover. Or I simply mail my order to them at P.O. Box 30665, Albuquerque, NM 87190. Check or money order are (sic) OK, too. Heck, I even reprinted their order form and envelope at my expense and enclosed them here for you if you want to send them an order.”
As represented the solicitations contain a return form and a self-addressed envelope by which consumers can purchase the oral chelation formula called AtheChel from Respondent, the WorldLife Company, P.O. Box 30665, Albuquerque, NM 87190.
9. Respondent furnishes the AtheChel order form to AMP, one of the distributors of the solicitations. Respondent benefits from AMP’s promotional activities through the sale of AtheChel.
10. There are two versions of the AtheChel formula neither of which “would be capable of reducing the level of atherosclerotic plaque in the body or exerting a beneficial effect on the cardiovascular system.”
DISCUSSION
Complainant contends that the current solicitations falsely represent that AtheChel is a cure for heart disease and arteriosclerosis and therefore Respondent has violated the terms of the Cease and Desist Order and is in breach of the terms of the Agreement. Respondent contends that she has neither violated the terms of the Cease and Desist Order nor breached the terms of the Agreement. She therefore requests that the Petition be denied.
Respondent first argues that the Cease and Desist Order prohibits the representation that a dietary supplement, vitamin or nutrient extract compound is a “cure” for any of the enumerated ailments, but does not prohibit the representation that a product is a “remedy” or “treatment.” According to Respondent, since the current solicitations do not contain the word “cure”, they do not make the representation prohibited by the Cease and Desist Order.
The current solicitations themselves are the best evidence of their contents and 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. An examination of the solicitations establishes that they do represent that oral chelation, and therefore AtheChel, is a cure for heart disease and arteriosclerosis. Although the solicitations may not contain the word “cure,” the overall impression created in the mind of the ordinary reader is that AtheChel is a cure for heart disease and/or arteriosclerosis.
The current solicitations are replete with language heralding oral chelation as the natural method of opening and flushing plaque from clogged arteries. Additionally, the explanation of why the medical profession does not promote oral chelation as an alternative to bypass surgery, coupled with the use of the terms “remedy” and “treatment,” would most likely lead the ordinary reader to believe that AtheChel, the oral chelation mix, achieves the same results as bypass surgery by curing heart disease, arteriosclerosis and/or other diseases or conditions. Accordingly, Respondent’s contention that the current solicitations do not contain the representations prohibited by the Cease and Desist Order is without merit.
Respondent next contends that the solicitations do not make the representations alleged in the Petition because the prohibitions of the Cease and Desist Order apply only to the dietary supplement Aslan GH-III Formula, or similar anti-aging products, and do not apply to other dietary supplements such as her current product, AtheChel. According to Respondent this interpretation of the Cease and Desist Order is consistent with her intention at the time she signed the Agreement and is supported by the language used in the Cease and Desist Order.
In Section III of the Cease and Desist Order Respondent is directed to cease and desist from falsely representing that (1) any dietary supplement is a cure for the 32 listed conditions “and/or” (2) that any product is similar to the Gerovital formula tested by Dr. Aslan. Section III(1) and (2) are connected by the words “and/or,” which clearly provides that the prohibitions of the two subsections are to be read both separately and together, not simply together as Respondent contends. Thus, Respondent’s argument that the two subsections are only to be read conjunctively is not supported by the plain language of the Cease and Desist Order. Moreover, there is no ambiguity in the language of the Cease and Desist Order which would require reliance on parol evidence concerning either parties’ intended interpretation of the Order at the time of execution. Accordingly, the plain and unambiguous language of the Cease and Desist Order extends to any dietary supplement including Respondent’s current AtheChel formula and thus, Respondent’s argument that the Cease and Desist Order is limited to the Aslan GH-III Formula, or anti-aging products similar thereto, is without merit.
Respondent additionally argues that before filing the breach Petition Complainant was required to communicate with Respondent in order to ascertain whether there was substantiation for the current representations. Absent such communication, Respondent contends the Petition is defective on its face.
Although the Cease and Desist Order permits certain representations if they are supported by competent scientific evidence or FDA approval, it does not place any burden on Complainant to attempt to obtain such information from Respondent before filing a breach Petition. Moreover, Respondent has not even asserted that the current representations are supported by either competent scientific evidence or FDA approval. Accordingly, Respondent’s contention that the Petition is defective on its face because Complainant failed to communicate with Respondent before filing the breach Petition is without merit.
Respondent next argues that Complainant was aware of the AtheChel promotional materials two years prior to filing the breach Petition and that it delayed filing the Petition because it had initially concluded that the Agreement had not been breached. However, neither the Agreement nor the Cease and Desist Order places any time limits on the period for filing a breach Petition. Moreover, contrary to Respondent’s contention, Complainant’s delay in initiating this proceeding does not raise any inferences as to Complainant’s prior position, nor does it create any higher standard for determining whether a breach of the Agreement has occurred.
Respondent’s principal contention in this proceeding is that whatever representations are found to have been made are being made by an unrelated third party, AMP, and not Respondent. In support of this contention Respondent argues that the current solicitations are distributed by an independent entity, AMP, primarily to promote its publication espousing the concept of oral chelation therapy.
Although it may be true that there is no express contractual relationship between the parties and that AMP exercises a certain degree of independence, there is a sufficient relationship between Respondent and AMP to be able to find that Respondent has violated the terms of the Cease and Desist Order and is in breach of the terms of the Agreement. Under the Agreement a false representation order may be issued upon breach of the Agreement by “Respondent or any party in privity with the Respondent.” AMP’s advertisement for Respondent’s product, the furnishing of the order forms by Respondent to AMP and the sales generated by the advertisement, establish that AMP is acting in privity with Respondent and serving as her agent or representative for the promotion of her product. Moreover, Respondent’s use of a supposed independent third party in both her original and current promotions coupled with her agreement to discontinue the original promotion supports the conclusion that privity between AMP and Respondent exists and that AMP is acting as Respondent’s agent or representative. Accordingly, Respondent’s argument that the current representations are being made by an unrelated third party is not persuasive.
Finally, Respondent’s argument that Complainant has failed to establish the falsity of the representations is also without merit. Contrary to Respondent’s argument, Complainant has satisfactorily established that neither of the two versions of the AtheChel formula would have a beneficial effect on the cardiovascular system. Therefore, AtheChel is not a “cure” or remedy for heart disease or arteriosclerosis as represented in the current solicitations.
CONCLUSION
The record establishes that Respondent has breached the terms of the Agreement in the manner alleged in the Petition. Accordingly, pursuant to paragraph 6 of the Agreement, the false representation order sought in the Petition is issued herewith.
James A. Cohen
Judicial Officer
This page was posted on January 5, 2017.
