STATE ex rel. Jeremiah W. NIXON, Attorney General, Respondent, v. TELCO DIRECTORY PUBLISHING, d/b/a Telco National Business Directory, and Scott Wilcox, Appellants.
No. 75356.
Supreme Court of Missouri, En Banc.
Sept. 28, 1993.
Rehearing Denied Oct. 26, 1993.
863 S.W.2d 596
Jeremiah W. (Jay) Nixon, Atty. Gen., Anne E. Schneider, Asst. Atty. Gen., Jefferson City, for respondent.
ROBERTSON, Judge.
In State v. Shaw, 847 S.W.2d 768 (Mo. banc 1993), this Court upheld the constitutionality of the criminal penalties imposed by
The trial court found that appellants had violated
I.
Scott D. Wilcox does business as Telco Directory Publishing, a sole proprietorship. Wilcox publishes the Telco National Business Directory, a directory that includes listings in various business and professional categories. To further his sales efforts, Wilcox designed and mailed a solicitation to potential customers аcross the country. Those who purchased the directory automatically received a free listing in the directory for the next year.
In October, 1986, Wilcox mailed a number of his solicitations to persons and businesses in Missouri. Fifty-five Missouri businesses and individuals purchased the directory. Ten other individuals, who received the solicitation but did not purchase the directory, complained to the Attorney General‘s Office about the deceptive nature of the solicitatiоn they received.
The solicitation appears in full in Appendix A. It consists of a single sheet of paper printed to bear a resemblance to an invoice. The paper is perforated so that the top can be detached and returned in an envelope that accompanied the solicitation. The front side of the bill also includes the words, “This is not an invoice. Use this form to place your order,” in bold black letters immediately abоve the perforation.
The backside of the solicitation sets forth the full terms of the solicitation, including the explanation that the amount requested on the front is payment for a directory and that purchase of the directory entitles the purchaser to a free listing in the next year‘s directory. The wording on the backside of the form is not susceptible to misinterpretation. However, it is printed in light gray ink. Wilcox testified that he used the light gray ink to avoid “bleed through.” Persons who received the solicitation testified that the light colored ink made the back difficult to read.
Upon receiving the complaints, the attorney general filed an action under
The trial court entered findings of fact and conclusions of law. The trial court believed that the solicitation had the “capаcity to deceive.” Based on this standard, the trial court found that the solicitation was a “deception” in violation of
II.
Wilcox raises two preliminary jurisdictional points. First, he asserts that neither the Missouri long-arm statute nor the Due Process Clause of the Fourteenth Amendment permits Missouri courts to exercise personal jurisdiction over him. Second, he argues that
In State ex inf. Danforth v. Reader‘s Digest Association, Inc., 527 S.W.2d 355, 358 (Mo. banc 1975), this Court resolved the issues raised by appellants in this case against appellants. We reaffirm that decision, holding again that Missouri may properly exercise personal jurisdiction over Wilcox and may regulate unfair and deceptive merchandising practices even when the relevant matters are sent through the mails. The first two points are denied.
III.
In pertinent part, the statutes at issue here are set out.
The act, use or employment by any person of any deception, fraud, false pretense, false promise misrepresentation, unfair practice or the concealment, suppression or omission of any material fact in connection with the sale or advertisement of any merchandise in trade or commerce ... in or from the state of Missouri, is declared to be an unlawful practice.... Any act, use or employment declared unlawful by this subsection violates this subsection whether committed before, during or after the sale, advertisement or solicitаtion.
1. Whenever it appears to the attorney general that a person has engaged in, is engaging in, or is about to engage in any method, act, use, practice or solicitation, or any combination thereof, declared to be unlawful by this chapter, he may seek and obtain, in an action in a circuit court, an injunction prohibiting such person from continuing such methods, acts, uses, practices, or solicitations, or any combination thereof, or еngaging therein, or doing anything in furtherance thereof.
*
6. The court may award to the state a civil penalty of not more than one thousand dollars per violation....
In any action brought under the provisions of
section 407.100 , the attorney general is entitled to recover as costs, in addition to normal court costs, the costs of the investigation and prosecution of any action to enforce the provisions of this chapter.
A.
Wilcox assigns error to the trial court‘s judgment claiming that the attorney general failеd to meet certain prerequisites to relief commonly required in nonstatutory actions.
First, Wilcox argues that the attorney general may not obtain relief under
2.
Second, Wilcox assumes that an action under
B.
Next, Wilcox argues that
Charlie‘s Chevrolet deals with a private right of action created by
C.
Wilcox next asserts that the trial court erred in permitting certain live and deposition testimony at trial.
First, Wilcox claims that any witness testifying in an action brought by the attorney general for civil fines or any injunction must have “standing,” i.e., must meet
Second, Wilcox argues that the testimony of the witnesses constituted improper lay opinion as to whether the solicitation was deceptive. While some of the witnesses may have expressed “opinions” as to the nature of the solicitation, in large measure the testimony described the facts about their receipt of the solicitation and their understanding of its mеaning. Our review of the testimony convinces us that the witnesses did no more than describe their impression of the solicitation. Lay witnesses may couch their testimony in convenient shorthand, even if it sounds like an opinion. See Beuttenmuller v. Vess Bottling Co., 447 S.W.2d 519, 526 (Mo.1969). The point is denied.
IV.
The trial court found that “deception” existed within the meaning of
A.
Wilcox offers two inextricably linked arguments regarding the validity of the statute and the prоpriety of the trial court‘s finding that his solicitation violated the statute. First, Wilcox argues that the statute is unconstitutionally vague because the word “deception” used in the statute provides no standard and that the “capacity to deceive” standard adopted by the trial court is also itself inadequate and vague. Second, Wilcox argues that a “capacity to deceive” is not the same as “deception,” i.e., the standard applied by the trial court was wrong under the statutory language.
B.
The prohibition against vague state laws arises from the Due Process Clause of the Fourteenth Amendment. The vagueness doctrine has two distinct bases. First, it is unfair to apply a law to a person who could not have determined in advance what conduct the law permitted and prohibited. Persons cannot fairly be required to obey a law so unclеar in its terms that it provides no notice of its scope. Second, a vague law provides no standard to guide or restrict enforcement officials. The law must provide some guidance for enforcement officials and courts to lessen the possibility of arbitrary and discriminatory enforcement.
Village of Hoffman Estates v. Flipside, Hoffman Estates, Inc., 455 U.S. 489, 498-499 (1982), establishes a sliding scale for measuring statutes against the due process clause. The degree of vaguenеss that the Constitution tolerates—as well as the relative importance of fair notice and fair enforcement—depends in part on the nature of the enactment. Thus, economic regulation is subject to a less strict vagueness test because its subject matter is often more narrow, and because businesses, which face economic demands to plan behavior carefully, can be expected to consult relevant legislation in advance of action.... The Court has also expressed greater tolerance of enactments with civil rather than criminal penalties because the consequences of imprecision are qualitatively less severe. And the Court has recognized that a scienter requirement may mitigate a law‘s vagueness, especially with respect to the adequacy of notice to the complainant that [his or her] conduct is proscribed.
Finally, perhaps the most important factor affecting the clarity that the Constitution demands of a law is whether it threatens to inhibit the exercise of constitutionally protected rights.
In Shaw, 847 S.W.2d at 775, this Court held that deception is a species of common law fraud, that ”
We hold, as we did in Shaw, that “deception” has a commonly understood meaning to persons of reasonable intelligence. Its use in
C.
There remains the matter of the trial court‘s reliance on a “capacity to deceive standard” for determining whether Wilcox’ solicitation violated
The attorney general argues that “capacity to deceive” is the standard in at least twenty-one states and in federal law. The vast majority of the foreign cases on which the attorney general relies, however, found their decisions on statutes that expressly invoke federal law as definitive of the meaning of the state statute.2 Thus, the attorney general‘s argument is persuasive only to the extent that the Missouri statute is susceptible to such an interpretation. For the reasons that follow, Missouri law is different and the authority from other states loses its persuasive force.
Many states have enacted laws to protect consumers from unscrupulous business practices. Many of these states’ statutes are “little F.T.C. acts,” modeled after the Federal Trade Commission Act, which prohibits “unfair and deceptive acts and practices.”
In 1967, Missouri joined the states whose legislatures had enacted statutes to protect consumers from fraudulent business practices. From 1967 until 1986, Missouri law expressly invoked the federal law and by that reference incorporated the meaning of the federal law into Missouri law.
Given this legislative history, we conclude that at the time of Wilcox’ acts the common law meaning of “deception” limited the reach of
In this case the trial court found that several persons were “initially deceived” by Wilcox’ solicitation. However, all of these witnesses ultimately “determined that the solicitation was not a bill and, therefore, did not pay the same.” The trial court did not find actual deception; it found no more than a capacity in the solicitation for “initial deception.” For the reasons expressed, we hold that this standard is contrary tо the statute extant in 1986 and insufficient as a basis for the imposition of civil penalties.
Moreover, we are aware of no argument that would support reading the statute differently where the attorney general seeks injunctive relief. The trial court erred in founding its injunction on the solicitation‘s “capacity to deceive.” The statute applicable to Wilcox’ activities also requires actual deception before an injunction is approрriate.
Because the trial court employed an incorrect legal standard in holding as it did, the attorney general will be permitted to put on evidence of actual deception on remand to the extent that such evidence is available.
V.
The judgment of the trial court is reversed. The cause is remanded for further proceedings consistent with this opinion.
COVINGTON, C.J., and HOLSTEIN, BENTON, PRICE and LIMBAUGH, JJ., concur.
THOMAS, J., concurs in result in part and concurs in part in separate opinion filed.
THOMAS, Judge, concurring in result in part and concurring in part.
The majority finds that the word “deception” as used in
I.
The majority opinion references the history of the statute in discussing the “capacity to deceive” standard. Until 1986, Missouri law incorporated the meaning of federal law rather than common law to interpret “deception.”
It is clear that when the legislature removed the reference to federal law from the statute the legislature intended to break with the existing federal interpretation. It is equally clear that by leaving the development of standards to the attorney general the legislature did not intend to revert to the common law interpretation. What is not clear is what standard was intended to prevail during the four years the attorney general was developing standards. It is unlikely that the legislature contemplated a period as long as four years without regulations. I do not believe it intended that the meaning of the word “deception” would “accordion” in and out as the majority opinion holds, contracting to common law fraud pending the development of regulations by the attorney general and then expanding to whatever meaning the attorney general finally prescribes for deception once those regulations are adopted. A reasonably intelligent business person would be unsure of the meaning of the term “deception” during this interim period. For that reason, “deception” as used in the statute at the times relevant to this case was unconstitutionally vague.
II.
The analysis above does not сhange the result in the majority opinion. A defendant whose conduct falls within the “core” of the law may not challenge the law as vague even though the law‘s mandate is unclear in other areas. Given the history of the statute, it is clear that “deception” includes common law fraud. The statute is not vague in this respect. It is vague because it is not clear how far it reaches beyond that common law definition. I concur in the remand to the trial court to allow thе attorney general the opportunity to prove common law fraud.
III.
I concur in the remainder of the opinion.