423 F.3d 397 (4th Cir. 2005), 04-1804, United Seniors Ass'n, Inc. v. Social Sec. Admin.

Docket Nº:04-1804.
Citation:423 F.3d 397
Party Name:UNITED SENIORS ASSOCIATION, INCORPORATED, Petitioner, v. SOCIAL SECURITY ADMINISTRATION, Respondent. National Taxpayers Union, Amicus Supporting Petitioner.
Case Date:August 25, 2005
Court:United States Courts of Appeals, Court of Appeals for the Fourth Circuit

Page 397

423 F.3d 397 (4th Cir. 2005)




National Taxpayers Union, Amicus Supporting Petitioner.

No. 04-1804.

United States Court of Appeals, Fourth Circuit.

August 25, 2005

Argued May 26, 2005.

On Petition forReview of an Order of the United States Department of Health and Human Services, C-02-061.

Page 398

[Copyrighted Material Omitted]

Page 399



Robert Ronold Sparks, Jr., SPARKS & CRAIG, L.L.P., McLean, Virginia, for Petitioner.

Tara Leigh Grove, UNITED STATES DEPARTMENT OF JUSTICE, Appellate Staff, Civil Division, Washington, D.C., for Respondent.

ON BRIEF: Peter D. Keis-ler, Assistant Attorney General, Mark B. Stern, Michael S. Raab, UNITED STATES DEPARTMENT OF JUSTICE, Appellate Staff, Civil Division, Washington, D.C., for Respondent.

Michael E. Geltner, GELTNER & ASSOCIATES, P.C., Washington, D.C., for Amicus Supporting Petitioner.

Before WILLIAMS and SHEDD, Circuit Judges, and HAMILTON, Senior Circuit Judge.

Petition for review denied by published opinion. Judge Williams wrote the opinion, in which Senior Judge Hamilton joined. Judge Shedd wrote a separate concurring opinion.


WILLIAMS, Circuit Judge:

United Seniors Association, Inc. (USA) petitions for review of a decision of the Department of Health and Human Services' Departmental Appeals Board (the Board) upholding a determination by an administrative law judge (ALJ) that envelopes mailed by USA violated § 1140 of the Social Security Act, 42 U.S.C.A. § 1320b-10 (West Supp. 2005). The Board also upheld a $554,196 civil penalty imposed by the ALJ against USA. Because we find that § 1140(a)(1) applies to envelopes, that substantial evidence exists to support the ALJ's finding that USA's envelopes violated § 1140(a)(1), and that § 1140(a)(1) is not unconstitutionally vague or overbroad, we deny the petition for review.


"More than nine out of ten individuals age[d] 65 and older receive Social Security benefits," and "about two thirds of [those] Social Security beneficiaries receive 50% or more of their income from Social Security." Social Security Basic Facts, available at http:// www.ssa.gov/pressoffice/basicfact.htm (March 23, 2005). Congress, in 1988, enacted § 1140 in order to combat what it viewed was a rise in deceptive mailings targeting seniors. 42 U.S.C.A. § 1320b-10. In passing § 1140, Congress sought to protect Social Security recipients from potential identity theft, from spending their Social Security benefits on organizations camouflaging as governmental entities, and from endless solicitations. Congress was concerned that the number of "[m]ass mailing appeals to Social Security beneficiaries" with "inaccurate and misleading information" was dramatically increasing. Misleading & Deceptive Mailings to Social Security Beneficiaries, hearing Before the Subcommittee on Social Security of the Committee on Ways and Means, 100th Cong. 2 (1987). Congress also sought to preserve the line of communication between the SSA and its recipients because of its fear that if recipients were inundated with deceptive mailings, there would be an "increase[d] . . . likelihood that true Government mailings will be destroyed without being opened." House Comm. on Ways and Means, 102d Cong., Report on Deceptive Solicitations 5 (Comm. Print 1992).

Page 400

To that end, § 1140 prohibits the misuse of "symbols, emblems, or names in reference to Social Security" in hopes of preventing confusion by Social Security recipients. Id. in relevant part, § 1140(a)(1) states the following:

(a) Prohibited acts

(1) No person may use, in connection with any item constituting an advertisement, solicitation, circular, book, pamphlet, or other communication, or a play, motion picture, broadcast, telecast, or other production, alone or with other words, letters, symbols, or emblems - -

(A) the words "Social Security", "Social Security Account", "Social Security System", "Social Security Administration", "Medicare", "Centers for Medicare & Medicaid Services", "Department of Health and Human Services", "Health and Human Services", "Supplemental Security Income Program", "Medicaid", "Death Benefits Update", "Federal Benefit Information", "Funeral Expenses", or "Final Supplemental Plan", the letters "SSA", "CMS", "DHHS", or "SSI", or any other combination or variation of such words or letters . . . in manner which such person knows or should know would convey, or in a manner which reasonably could be interpreted or construed as conveying, the false impression that such item is 4 United Seniors Assoc. v. Social Security Admin. approved, endorsed, or authorized by the Social Security Administration. . . .

Id. by statute, the Social Security Administration (SSA) is charged with the enforcement of this provision. 42 U.S.C.A. § 1320b-10(d).

USA is a nonprofit, lobbying and advocacy group organized to educate and mobilize senior citizens on a variety of issues affecting them, including Social Security benefits. In 2002, USA reported total revenues of $24,975,370 and a net profit of approximately $500,000. USA solicits money and other support from individuals through mass mailings. USA designs its envelopes to entice recipients to open the envelopes, and it mails information and solicitations repeatedly to the same people.

Two envelopes used by USA form the basis of this action. See attachments. The first envelope has the words "SOCIAL SECURITY" printed in bold letters across the top of the envelope. (Attachment A) The front of the envelope is designed to resemble a FedEx or express mail letter. There is a box labeled "Handling Instructions" in which the options "Urgent Alert", "Express Service", and "Standard Delivery" appear, and the small box beside "Urgent Alert" is marked with a red check. (J.A. 49.) The envelope also displays a package tracking number. Around the perimeter of the envelope, the words "SOCIAL SECURITY ALERT" appear over and over. United Seniors Association, Inc. is listed as the sender of the letter. (J.A. 49.) The envelope label also contains a block authorizing delivery without a signature. On the back of this envelope, the message " – URGENT – . . . SOCIAL SECURITY INFORMATION ENCLOSED" appears. (J.A. 50.) The "SOCIAL SECURITY ALERT" border is also printed on the back of the envelope. (J.A. 50.) The second envelope in dispute contains essentially the same design, but the "SOCIAL SECURITY ALERT" border is not present. The second envelope is a snap mailer, which is opened by pulling off the perforated edge of the envelope. The snap mailer directs the recipient "TO OPEN IMMEDIATELY." (Attachment B) The rear of the second envelope contains the message "SOCIAL SECURITY INFORMATION ENCLOSED." (J.A. 53.)

The SSA began receiving complaints concerning USA's mailings, and, after a review of USA's mailings, the SSA determined

Page 401

that USA had violated § 1140(a)(1). Acting on that determination, in September 1996, the SSA began discussions with USA regarding USA's alleged breaches of § 1140(a)(1) and continued these discussions until the issuance of a penalty letter in August 2001. The SSA's penalty letter advised USA that it had mailed 554,196 envelopes that violated § 1140(a)(1) and imposed a fine of $554,196 – one dollar per envelope. Upon receipt of the penalty letter, USA requested a hearing before an ALJ, as provided under the Social Security regulations. 20 C.F.R. § 498.109(b)(2004).

The ALJ held an evidentiary hearing on April 8, 2003, during which the SSA presented a postal inspector with the United States Postal Service, who described the misleading nature of USA's envelopes. The postal inspector testified that USA's mailers were standard or third class mail and the additional instructions on the envelopes such as the tracking number, handling instructions, and authorization for delivery without signature served no legitimate postal function. The postal inspector also testified that the red ink used for the "SOCIAL SECURITY ALERT" border in contrast to the black ink used for the sender's address is a technique generally used by mass mailers to detract attention from the sender block and focus attention on the Social Security message. The postal inspector further testified that from viewing the envelope, it appeared USA was trying to disguise the mass mailing nature of its envelopes and that a recipient of such an envelope would "[a]t first glance" believe it to be from the SSA and to contain Social Security information.

The SSA also presented testimony from a professor of elder law employed with the American Association of Retired Persons, who opined that typical Social Security recipients would believe that USA's envelopes "contain[ed] information about their social security benefit." (Transcript of proceedings before the ALJ, April 8, 2003 at 178.) The professor also testified that the checkmark beside "Urgent Alert" would direct elder recipients "to the fact that [the information] was urgent and it was important for them to open [the envelope] very promptly." (Transcript at 179.) The professor noted that such a technique was standard for mass marketers "to create a sense of urgency for the person to open the envelope." (Transcript at 180.) The professor further testified that a typical elderly Social Security recipient would be more inclined to open USA's envelopes than to dispose of them because of the prominent display of "Social Security" on the envelope and because the typical recipient would believe the envelopes were official documents.

In response, representatives from USA testified that USA wanted recipients to focus their attention on the message of the mailing, not USA as the sender. USA's representatives also conceded that the envelopes were targeted to senior citizens.

Based on the testimony and his own review of the contested envelopes, the ALJ...

To continue reading