Missouri Drug Co. v. Wyman

• Decision Date: 09 May 1904
• Citation: 129 F. 623
• Parties: MISSOURI DRUG CO. v. WYMAN
• Court: U.S. District Court — Eastern District of Missouri

129 F. 623

MISSOURI DRUG CO. v. WYMAN

United States Circuit Court, E.D. Missouri, Eastern Division.

May 9, 1904

On November 3, 1903, the Acting Assistant Attorney General for the Post-Office Department of Washington, D.C., notified the Missouri Drug Company, doing business in the city of St Louis, Mo., that charges had been lodged with the Postmaster General against the drug company to the effect that it was engaged in conducting a scheme or device for obtaining money through the mails by means of false and fraudulent representations or promises, in violation of sections 3929 and 4041 of the Revised Statutes of the United States (U.S Comp. St. 1901, 2686, 2749); that a statement of the nature of the charges was inclosed with the notice; and that it was desired that the drug company make a reply to the charges on November 18, 1902. On the day appointed for the hearing before the Acting Assistant Attorney General for the Post-Office Department the drug company appeared by its president, and filed a written reply to the charges of some length. In its reply it set out with considerable detail its method and manner of doing business, and insisted, in substance, that it was not engaged in obtaining patronage for the medicines which it was engaged in selling by means of false and fraudulent representations but, was transacting its business in a lawful manner. Subsequent to the hearing, and on December 7, 1903, the drug company was advised, in substance, that all the evidence in the case had been carefully considered by the Post-Office Department, and that it had been decided 'that that part of the company's business which relates to the cure for lost manhood is in violation of the postal fraud laws. ' It was further advised that it was 'not the desire of the Post-Office Department to interfere with any legitimate business (of the drug company), but to suppress that part which relates to cure for lost manhood,' and that it had been decided to give the company an opportunity to discontinue the objectionable branch of its business by signing an affidavit that it had entirely discontinued and abandoned the sale of its 'Vitality Pills,' and all other business connected with its cure for lost manhood, with the exception of completing the treatment of patrons who had actually ordered 'Vitality Pills' at the time of the signing of the affidavit. On receipt of this communication the drug company, under date of December 17, 1903, filed an affidavit to the effect that it had ordered the immediate discontinuance of all public advertising in the newspapers and magazines of a cure for lost manhood known as 'Vitality Pills,' and that it had stopped the use of the mails for the shipment of 'Vitality Pills,' except in fulfillment of promises made previous to the signing of the affidavit. Subsequently the Post-Office Department appears to have been advised that, notwithstanding the statement contained in the affidavit of December 17 1903, the drug company was using the mails for the purpose of distributing 'Vitality Pills,' whereupon, under date of February 15, 1904, a fraud order was issued by the Postmaster General, known as 'Order No. 126.' This order recited, in substance, that it had been made to appear to the Postmaster General, upon evidence satisfactory to him, that the Missouri Drug Company, its officers and agents, at St. Louis, Mo., was engaged in conducting a scheme or device for obtaining money through the mails by means of false and fraudulent pretenses, representations, and promises, in violation of the act of Congress entitled 'An act to amend certain sections of the Revised Statutes relating to lotteries and for other purposes,' approved September 19, 1890, 26 Stat. 465, c. 908 (U.S. Comp. St. 1901, p. 2659). Whereupon the postmaster at St. Louis, Mo., was forbidden to pay any postal money orders payable to the order of the Missouri Drug Company, and to inform persons transmitting such postal money orders that payment thereof had been forbidden, and that the amount would be returned upon presentation of the original order, or a duplicate thereof, which should be applied for and obtained under the regulations of the department. The postmaster at St. Louis, Mo., was further ordered to return all the letters, whether registered or not, and other mail matter, which should arrive at his office directed to said Missouri Drug Company, to the postmasters at the offices at which such mail matter was originally received, with the word 'Fraudulent' plainly written or stamped upon the outside of such letters or other mail matter; and that, where there was nothing on such letters to indicate who were the senders, to cause such letters to be sent to the dead letter office, with the work 'Fraudulent' plainly written or stamped thereon, to be disposed of as other dead matter under the laws and regulations applicable thereto. After the issuance of this order, and on March 2, 1904, the drug company filed its bill of complaint against Frank Wyman, postmaster in the city of St. Louis, praying for an injunction perpetually enjoining and restraining him and his employes from obeying such order of the Postmaster General, and from interfering with the complainant's mail matter in any respect. The bill of complaint alleged, in substance, and as a ground of relief, that it had been for some time past engaged in the business of healing disease and ailments of the human family, and more particularly those diseases and ailments which affected the nervous and sexual organs; that it had expended large sums of money in advertising its remedies for such ailments, and had created a large demand for its remedies throughout the United States; that said business was a legal and legitimate business, conducted according to legal and business methods, and was founded solely on the medicinal virtues of the remedies which it was engaged in selling; that its remedies were capable of cure, and had cured many ailments of the nervous and sexual organs; that sections 3929 and 4041 of the Revised Statutes of the United States (U.S. Comp. St. 1901, pp. 2686, 2749) have no application whatever to the business in which the complainant was engaged, and that said business was legitimate, and that no fraud, deceit, deception, or misrepresentation of any kind had ever been practiced by it. On the presentation of the bill of complaint an order was entered requiring the postmaster at St. Louis to appear on a certain day and show cause why a temporary injunction such as was prayed for in the bill should not be granted. In obedience to the rule to show cause a return was made by the postmaster, in which return it was alleged, amongst other things, that at the time said fraud order was issued, and for a long time prior thereto, the complainant had been engaged in a scheme by it devised to defraud divers persons throughout the United States, which scheme was to be effected through the use and by means of the post-office establishment of the United States. On the hearing of the application for a preliminary injunction the court made an order restraining the postmaster, during the pendency of the cause, and until a final hearing, from executing so much of the order of the Postmaster General as required him to return mail matter addressed to the complainant to the senders thereof and branding it fraudulent. At the same time, by consent of the complainant and the defendant, an order was made directing that the cause be speeded to a final determination, that the time be shortened for the taking of such testimony as the parties desired to submit, and that when such testimony was taken the cause be submitted to the court for such final decree as it thought proper to enter. The defendant thereafter filed an answer to the bill of complaint. In the answer so filed the defendant in substance repeats the allegations constrained in his return to the rule to show cause, that when the fraud order was issued the complainant was, and for a long time prior thereto had been, engaged in a scheme and artifice to defraud divers persons resident in the United States by means and by use of the post-office establishment. The nature of such fraudulent scheme was also stated with some detail in the answer. In pursuance of the permission given to the parties to take such testimony as they desired to take, considerable testimony has been taken by the complainant, and the cause has been submitted to the court for final decree upon such testimony, the defendant declining to take any testimony in his own behalf.

Ashley C. Clover and James H. Harkless, for complainant.

David P. Dyer, U.S. Dist. Atty., for respondent.

THAYER Circuit Judge, after stating the case as above, .

Regarding the proposition which was advanced on the hearing that the statutes under which the Postmaster General assumed to act in issuing the fraud order, to wit, sections 3929 and 4041 of the Revised Statutes (U.S. Comp. St. 1901, pp. 2686, 2749) and section 4 of chapter 191 of the act of March 2, 1895 (28 Stat. 964 (U.S. Comp. St. 1901, p. 2688)), are unconstitutional, it is sufficient to say that the court adheres to the views which it expressed on that point in the case entitled American School of Magnetic Healing v. McAnnulty (C.C.) 102 F. 565, and to the views previously expressed by the Circuit Court of Appeals for the Sixth Circuit in ...