Getting What They Had Coming

From the decision of the Third Circuit Court of Appeals in National Taxpayers Union v. Social Security Office of Inspector General:

In 2001, NTU [National Taxpayers Union] sent thousands of direct mail pieces to consumers to solicit donations. The brochures included language in large, red, bold type that stated, “Official National Survey on Social Security.” The brochures also included the statement that it was “commissioned by the NTU for the Social Security Administration, White House, and Congress of the United States.” The Social Security Administration (“SSA”) received a complaint, and the Inspector General of the SSA determined that the mailing violated Section 1140 of the Social Security Act. Section 1140 prohibits the use of nineteen phrases, including “social security,” in a manner that either (1) the writer knows or should know, or (2) the reader could reasonably perceive as conveying the false impression of official endorsement of the material by the SSA or the government. The Inspector General sent a cease-and-desist letter to NTU, and NTU responded with an apology. SSA subsequently received an additional complaint, and determined that the basis of the new complaint was a slightly altered version of the same brochure which NTU mailed after the cease-anddesist letter. The SSA Inspector General sent another letter to NTU, demanding that NTU provide written confirmation of its intent to comply with Section 1140 within ten days. Instead of complying, NTU filed a lawsuit in United States District Court, claiming that Section 1140 was unconstitutional. While the action was pending, NTU mailed a third version of the brochure, which SSA also considered misleading and in violation of Section 1140.

The SSA Inspector General wrote NTU, stating that it planned to impose a penalty in the amount of $274,582, or $.50 per offending direct mail piece. NTU requested a hearing in front of an ALJ, who found that NTU violated both prongs of Section 1140. ... NTU appealed the ALJ’s decision to the Appeals Board of the Department of Health and Human Services, which refused to review the decision, thereby adopting the ALJ’s decision as final. NTU petitions this Court for review of the agency’s final decision. ...

For the foregoing reasons, we will deny NTU’s petition.