Evening star. [volume] (Washington, D.C.) 1854-1972, 1897-11-17
ARGUMENTS HEARD
The Trading Stamp Case in the
Court of Appeals.
Mr.. WORFHINGTON and Mr.. THOMAS
Justice Alvey Asks Some Pertinent
Questions.
THE DECISION RESERVED

The question OF whether or not the trad.
ing stamp business, as attempted to be
carried on here, is prohibited by section
11I7 Of the Revised Statutes of the District
of Columbia was discussed today before
the Court of Appeals, in the case of Gus
tave Lansburgh and Joseph A. Sperry. the
court reserving its decision.
Messrs. Lansbulgh and Sperry 1t will
| be recalled, were recently convicted in the
| Police Court of engaging "in the busi-
ness of gift enterprise. contrary to and
in violation of" the section of the statute in
| question. The defendants were duly con-
victed and fine of 500 was imposed.
Thereupon they obtained writ of error to
the Court Of Appeals. and on their behalf
the question was argued today by Mr.. A.
| s. Worthington. the District being repre-
| sented by Attorneys S. 7. Thomas and A.
| b. Duvall.
TIE arguments were opened by Mr..
| Worthington, and he assigned as the errors
/ of the trial court the holding by that court
| that the defendants violated the law in
| question. and i'm holding that that section is
| constitutional and valid. Al the outset,
| said MIR. Worthington. the section reason
| ably construed applies only to gift enter
| prises in which the distribution of gifts or
| prizes Is in some way regulated by chance.
He then went on to argue that the trading
| stamp DuSlleSS as On Dy the de-
| PENDANTS contains no element of chance.
He claimed that the customer whose pur-
chase amounts to Id cents or more is en-
| titled to the benefit of a discount. Mr..
| Worthington also submitted that the case
cannot be sustained unless it be held that
| Congress has undertaken to prohibit every
person who has anything to sell from Offer
ing gift or discount 10 anybody who will
| buy that thing He was proceeding to
| plain the business when Chief Justice Alvey
| inquired If the stamps are ever redeemed.
| MIR. Worthington admitted that not until
| some one collects $50 of the stamps can
| they be redeemed.
THAT, your honor," remarked Mr.
| Thomas, lis the element of chance in the
| business. For unless one chances to collect
| 800 OF the stamps, he receives absolutely
| nothing, and as we will SHOW the chances
| are greatly against the collection by any
| cne, certainly against a poor man or wo-
| man, ever securing SO many"
Calls IL d Premium.
Confirming his argument that there is no
| element of chance in the business. Mr..
Worthington was again interrupted by
1 Chief Justice Alvey, Who inquired IL he
! contended that the trading stamp is a
premiLm Mr.. Worthington replied affirm
atively, when Mr.. Thomas inquired what
discount or premium is given by the mer-
| chant to the customer. to which Mr..
Worthington replied that each stamp rep
| resents the discount premium.
Yet" remarked Chief Justice Alvey
| unless the customer buys enough in time
to entitle him to $50 of the stamps he
| loses all the others and receives nothing
for them"
Mr.. Worthington dwelt at length on his
contention that the customer, when given
one of the trading stamps. receives a dis
count from the merchant, and submitted
that the business is legitimate one. Then
| he read definitions from the leading die
| tionaries to show that, as he contended
the enterprise is not such gift enterprise
| as is prohibited by the statute in question,
again insisting that there is no element OF
chance in ii.
Mr.. Thomas Argument.
Mr.. Worthington was followed by Mr..
\ Thomas, who argued that the trading
stamp business as carried on here by the
defendants was unquestionably In viola
| tion of the statute, and that the law is
constitutional and valid. In the course
| of his argument Mr.. Thomas referred to
the trading stamp enterprise as having all
the elements of lottery.
The stamp company, he said, gives The
customer absolutely nothing, merely hold
ing out a promise TO give something should
the customer ever chance to collect enough
| of them, requiring an expenditure by the
customer of $50 before he can obtain any,
thing from the company.
Mr.. Thomas said that IL he correctly un-
derstood Mr.. Worthington, his contention
is that a gift enterprise for moral pur-
poses is not In violation OF the law, and
! that the trading stamp business is a moral
enterprise. The statute, remarked Mr..
| Thomas prohibits any and all sift enter
prises. whether they be for moral purpose
not.
Mr.. Thomas assured the court that when
the scheme was closely examined it would
be found that it is based entirely on
chance In fact, that the element OF
chance pervsdes it throughout. pointing
| out that unless the customer collects $50
of the stamps he can get nothing. and that
unless the stamp agency keeps its part OF
the contract he would again fail to receive
anything. On the other hand, said Mr..
Thomas, the trading stamp company takes
the CHARGE that the customer, or, very few
of them, will ever be able to obtain a suf-
| fcient number of the stamps.
do the merchants, inquired Justice
Shepard share in the profits?"
NO your honor, replied Mr.. Thomas,
and then he went on to point out another
element of chance In the scheme, the
chance the merchant takes that all his GUS
toners will not ask for stamps, he profiting
| by every failure of a customer to demand
a stamp. Another chance in II for the
merchant said Mr.. Thomas, is that the
thoughtless the spendthrifts will flock to
his store through his advertisement of the
scheme a peculiar ingenious and bewilder-
ing one.
remarked that 1t is practically admitted
by the defendants that the scheme Ii
against the letter of the law, but IL is de-
MED by them that it is against the spirit of
the law. and submitted that there is no
giving of discount or premium in the gift
of the trading stamp, but merely the gift
of a chance to obtain something in the fu-
ture The fact, said Mr.. Thomas that the
customer receives with the stamp some-
thing of value does not remove the ele-
ment of chance. and he asked the court, by
its decision. to stop the business at once.
explaining that while II has been in opera
ton for q short time. the people have
seen II long enough to learn that II is in
rvfrn n q md IA -
dealings.
Closing Argumcnts.
Mr. Duvall followed Mr.. Thomas. ex-
planning the scheme, and pointing out that
1t can never benefit the purchasing public,
particularly the poor man. Mr.. Worthing-
ton closed the arguments. asking the court
to render it's decision at an early day. The
court however, did not intimate when its
decision may be expected.