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[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[S. 335 Introduced in Senate (IS)]

106th CONGRESS
  1st Session
                                 S. 335

To amend chapter 30 of title 39, United States Code, to provide for the 
nonmailability of certain deceptive matter relating to games of chance, 
administrative procedures, orders, and civil penalties relating to such 
                    matter, and for other purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                            February 3, 1999

 Ms. Collins (for herself, Mr. Cochran, Mr. Levin, Mr. Durbin, and Mr. 
Burns) introduced the following bill; which was read twice and referred 
                to the Committee on Governmental Affairs

_______________________________________________________________________

                                 A BILL

 
To amend chapter 30 of title 39, United States Code, to provide for the 
nonmailability of certain deceptive matter relating to games of chance, 
administrative procedures, orders, and civil penalties relating to such 
                    matter, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Deceptive Mail Prevention and 
Enforcement Act''.

SEC. 2. RESTRICTIONS ON MAILINGS USING INFERENCES TO THE UNITED STATES 
              GOVERNMENT.

    Section 3001 of title 39, United States Code, is amended--
            (1) in subsection (h) in the first sentence--
                    (A) by inserting after ``service; and contains'' 
                the following: ``any reference to the Postmaster 
                General of the United States or a citation to Federal 
                statute,'';
                    (B) by striking ``connection, approval or 
                endorsement'' and inserting ``connection, approval, or 
                endorsement, or that such matter is afforded any 
                special protections or status by the Federal 
                Government'';
                    (C) in paragraph (2)--
                            (i) in subparagraph (A) by striking ``and'' 
                        at the end;
                            (ii) in subparagraph (B) by striking ``or'' 
                        at the end and inserting ``and''; and
                            (iii) by inserting after subparagraph (B) 
                        the following:
                    ``(C) does not contain any statement that implies 
                that Federal Government benefits or services will be 
                affected by any purchase, non-purchase, response, or 
                non-response to such matter; or'';
            (2) in subsection (i) in the first sentence--
                    (A) by inserting after ``service; and contains'' 
                the following: ``any reference to the Postmaster 
                General of the United States or a citation to Federal 
                statute,'';
                    (B) by striking ``connection, approval or 
                endorsement'' and inserting ``connection, approval, or 
                endorsement, or that such matter is afforded any 
                special protections or status by the Federal 
                Government''; and
                    (C) in paragraph (2)--
                            (i) in subparagraph (A) by striking ``and'' 
                        at the end;
                            (ii) in subparagraph (B) by striking ``or'' 
                        at the end and inserting ``and''; and
                            (iii) by inserting after subparagraph (B) 
                        the following:
                    ``(C) does not contain any statement that implies 
                that Federal Government benefits or services will be 
                affected by any purchase, non-purchase, response, or 
                non-response to such matter; or'';
            (3) by redesignating subsections (j) and (k) as subsections 
        (m) and (n), respectively; and
            (4) by inserting after subsection (i) the following:
    ``(j)(1) Matter otherwise legally acceptable in the mails described 
under paragraph (2)--
            ``(A) is nonmailable matter;
            ``(B) shall not be carried or delivered by mail; and
            ``(C) shall be disposed of as the Postal Service directs.
    ``(2) Matter that is nonmailable matter referred to under paragraph 
(1) is any matter that--
            ``(A) constitutes a solicitation for the purchase of any 
        product that--
                    ``(i) is produced by the United States Government; 
                and
                    ``(ii) may be obtained without cost from the United 
                States Government; and
            ``(B) does not contain a statement giving notice of the 
        information under subparagraph (A) (i) and (ii).
    ``(3) The statement under paragraph (2)(B) shall be clearly and 
prominently displayed in conspicuous and legible type in such size and 
manner as the Postal Service shall prescribe by regulation.''.

SEC. 3. RESTRICTIONS ON SWEEPSTAKES AND DECEPTIVE MAILINGS.

    Section 3001 of title 39, United States Code, is amended by 
inserting after subsection (j) (as added by section 2(4) of this Act) 
the following:
    ``(k)(1) Matter otherwise legally acceptable in the mails that is 
nonmailable matter described under paragraph (2) shall not be carried 
or delivered by mail and may be disposed of as the Postal Service 
directs.
    ``(2) Matter that is nonmailable matter referred to under paragraph 
(2) is any matter that--
            ``(A) relates to a sweepstakes, prize promotion, or award; 
        and
            ``(B)(i) does not contain a statement in the mailing, 
        including any rules or order form, that no purchase is 
        necessary to enter such sweepstakes, prize promotion, or award;
            ``(ii) indicates that individuals not purchasing products 
        may be disqualified from receiving future mailings;
            ``(iii) requires that an entry be accompanied by a payment 
        for a product ordered;
            ``(iv) suggests that the odds of winning will be increased 
        by making a purchase;
            ``(v) represents that an individual is a winner unless that 
        individual has won a prize;
            ``(vi) does not state all terms and conditions of a 
        sweepstakes promotion, including the rules and entry procedures 
        for the sweepstakes, in language that is easy to find, read, 
        and understand;
            ``(vii) does not clearly and conspicuously disclose the 
        name of the person mailing such matter and the principal place 
        of business of such person;
            ``(viii) contains any statement that contradicts or is 
        inconsistent with contest rules, including any statement 
        qualifying, limiting, or explaining such rules in a manner 
        inconsistent with such rules;
            ``(ix) does not contain contest rules that clearly state 
        the odds of winning all prizes, the quantity, estimated retail 
        value, and nature of all prizes, and the schedule of any 
        payments made over time;
            ``(x) suggests or requires that the purchase of a product 
        will allow an entry to receive priority, or to be eligible to 
        receive additional prizes or special treatment for future 
        contests;
            ``(xi) does not clearly and completely disclose any fees, 
        charges, and conditions to be met to receive the prize in any 
        promotional mailing awarding free prizes or awards;
            ``(xii) if any facsimile check is included, does not 
        contain a statement that such checks are not negotiable 
        instruments and have no cash value; or
            ``(xiii) does not meet any other requirement the Postal 
        Service shall prescribe by regulation.
    ``(3) Any statement, notice, or disclaimer referred to under 
paragraph (2) shall be clearly and prominently displayed in conspicuous 
and legible type in such size and manner as the Postal Service shall 
prescribe by regulations.
    ``(4) In the enforcement of paragraph (2), the Postal Service shall 
consider the materials included in the mailing and on the material and 
language visible through the envelope.
    ``(5)(A) Any person who uses the mails for any matter that contains 
sweepstakes entry materials shall adopt reasonable practices and 
procedures to prevent the mailing of such materials to any person at 
any address who submits a written request to the mailer of such 
materials that such materials should not be mailed to such person at 
such address.
    ``(B) Any person who mails such solicitation materials shall 
maintain or cause to be maintained a record of all such requests. The 
records shall be maintained in a form to permit the suppression of such 
name at such address for a 5-year period beginning on the date the 
written request under subparagraph (A) is submitted.''.

SEC. 4. POSTAL SERVICE ORDERS TO PROHIBIT DECEPTIVE MAILINGS.

    Section 3005(a) of title 39, United States Code, is amended--
            (1) by striking ``or'' after ``(h),'' both places it 
        appears; and
            (2) by inserting ``, (j), (k), or (l)'' after ``(i)'' in 
        both such places.

SEC. 5. TEMPORARY RESTRAINING ORDER FOR DECEPTIVE MAILINGS.

    Section 3007 of title 39, United States Code, is amended--
            (1) by redesignating subsection (b) as subsection (c); and
            (2) by striking subsection (a) and inserting the following:
    ``(a)(1) In preparation for or during the pendency of proceedings 
under sections 3005 and 3006, the Postal Service, in accordance with 
section 409(d), may apply to the district court in any district in 
which mail is sent or received as part of the alleged scheme, device, 
lottery, or gift enterprise or in any district in which the defendant 
is found, for a temporary restraining order and preliminary injunction 
under rule 65 of the Federal Rules of Civil Procedure.
    ``(2) Upon a showing of probable cause and without any further 
showing, the court shall enter an order which shall--
            ``(A) remain in effect during pendency of the statutory 
        proceedings, any judicial review of such proceedings, or any 
        action to enforce orders issued under the proceedings; and
            ``(B) direct the detention by the postmaster, in any and 
        all districts, of the defendant's incoming mail and outgoing 
        mail, in furtherance of the scheme which is in the postmaster's 
        custody for dispatch or delivery.
    ``(3) Mail detained under paragraph (2) shall--
            ``(A) be made available at the post office of mailing or 
        delivery for examination by the defendant in the presence of a 
        postal employee; and
            ``(B) be delivered as addressed if such mail is clearly not 
        connected with the alleged unlawful activity.
    ``(4) No finding of the defendant's intent to make a false 
representation or to conduct a lottery is required to support the 
issuance of an order under this section.
    ``(b) If any order is issued under subsection (a) and the 
proceedings under section 3005 or 3006 are concluded with the issuance 
of an order under that section, any judicial review of the matter shall 
be in the district in which the order under subsection (a) was 
issued.''.

SEC. 6. CIVIL PENALTIES.

    Section 3012 of title 39, United States Code, is amended--
            (1) in subsection (a) by striking ``$10,000 for each day 
        that such person engages in conduct described by paragraph (1), 
        (2), or (3) of this subsection.'' and inserting ``twice the 
        amount of the civil penalty under subsection (b)(2) for the 
        applicable pieces mailed.'';
            (2) by redesignating subsections (b), (c), and (d), as 
        subsections (c), (d), and (e), respectively; and
            (3) by inserting after subsection (a) the following:
    ``(b)(1) Any person who, through use of the mail, sends any matter 
which is nonmailable under sections 3001 (a) through (l), 3005(a), 
3014, or 3015 of this title, shall be liable to the United States for a 
civil penalty in accordance with regulations the Postal Service shall 
prescribe.
    ``(2) The civil penalty under this subsection shall not exceed 
$50,000 for each mailing of less than 50,000 pieces; $100,000 for each 
mailing of 50,000 to 100,000 pieces; with an additional $10,000 for 
each additional 10,000 pieces above 100,000, not to exceed 
$2,000,000.'';
            (4) in subsection (c)(1) and (2), as redesignated, by 
        inserting after ``of subsection (a)'' the following: ``or 
        (b),''; and
            (5) in subsection (d), as redesignated, by striking 
        ``Treasury of the United States'' and inserting ``Postal 
        Service Fund established by section 2003''.

SEC. 7. ADDITIONAL AUTHORITY FOR THE POSTAL INSPECTION SERVICE.

    (a) In General.--Chapter 30 of title 39, United States Code, is 
amended by adding at the end the following:
``Sec. 3016. Administrative subpoenas
    ``(a) Authorization of Use of Subpoenas by Postmaster General.--In 
any investigation conducted under this chapter, the Postmaster General 
may require by subpoena the production of any records (including books, 
papers, documents, and other tangible things which constitute or 
contain evidence) which the Postmaster General finds relevant or 
material to the investigation.
    ``(b) Service.--
            ``(1) Service within the united states.--A subpoena issued 
        under this section may be served by a person designated under 
        section 3061 of title 18 at any place within the territorial 
        jurisdiction of any court of the United States.
            ``(2) Foreign service.--Any such subpoena may be served 
        upon any person who is not to be found within the territorial 
        jurisdiction of any court of the United States, in such manner 
        as the Federal Rules of Civil Procedure prescribe for service 
        in a foreign country. To the extent that the courts of the 
        United States may assert jurisdiction over such 
person consistent with due process, the United States District Court 
for the District of Columbia shall have the same jurisdiction to take 
any action respecting compliance with this section by such person that 
such court would have if such person were personally within the 
jurisdiction of such court.
            ``(3) Service on business persons.--Service of any such 
        subpoena may be made by a Postal Inspector upon a partnership, 
        corporation, association, or other legal entity by--
                    ``(A) delivering a duly executed copy thereof to 
                any partner, executive officer, managing agent, or 
                general agent thereof, or to any agent thereof 
authorized by appointment or by law to receive service of process on 
behalf of such partnership, corporation, association, or entity;
                    ``(B) delivering a duly executed copy thereof to 
                the principal office or place of business of the 
                partnership, corporation, association, or entity; or
                    ``(C) depositing such copy in the United States 
                mails, by registered or certified mail, return receipt 
                requested, duly addressed to such partnership, 
                corporation, association, or entity at its principal 
                office or place of business.
            ``(4) Service on natural persons.--Service of any subpoena 
        may be made upon any natural person by--
                    ``(A) delivering a duly executed copy to the person 
                to be served; or
                    ``(B) depositing such copy in the United States 
                mails by registered or certified mail, return receipt 
                requested, duly addressed to such person at his 
                residence or principal office or place of business.
            ``(5) Verified return.--A verified return by the individual 
        serving any such subpoena setting forth the matter of such 
        service shall be proof of such service. In the case of service 
        by registered or certified mail, such return shall be 
        accompanied by the return post office receipt of delivery of 
        such subpoena.
    ``(c) Enforcement.--
            ``(1) In general.--Whenever any person, partnership, 
        corporation, association, or entity fails to comply with any 
        subpoena duly served upon him, the Postmaster General may 
        request that the Attorney General seek enforcement of the 
        subpoena in the district court of the United States for any 
        judicial district in which such person resides, is found, or 
        transacts business, and serve upon such person a petition for 
        an order of such court for the enforcement of this section.
            ``(2) Jurisdiction.--Whenever any petition is filed in any 
        district court of the United States under this section, such 
        court shall have jurisdiction to hear and determine the matter 
        so presented, and to enter such order or orders as may be 
        required to carry into effect the provisions of this section. 
        Any final order entered shall be subject to appeal under 
        section 1291 of title 28. Any disobedience of any final order 
        entered under this section by any court shall be punished as 
        contempt.
    ``(d) Disclosure.--Any documentary material provided pursuant to 
any subpoena issued under this section shall be exempt from disclosure 
under section 552 of title 5.''.
    (b) Regulations.--Not later than 180 days after the date of 
enactment of this section, the Postal Service shall promulgate 
regulations setting out the procedures the Postal Service will use to 
implement this subsection.
    (c) Technical and Conforming Amendment.--The table of sections for 
chapter 30 of title 39, United States Code, is amended by adding at the 
end the following:

``3016. Administrative subpoenas.''.

SEC. 8. STATE LAW NOT PREEMPTED.

    Nothing in this Act shall be construed to preempt any provision of 
State or local law.

SEC. 9. EFFECTIVE DATE.

    This Act shall take effect 60 days after the date of enactment of 
this Act.
                                 <all>
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