                       THE BRAILLE MONITOR
Vol. 41, No. 3                                        March, 1998

                     Barbara Pierce, Editor


      Published in inkprint, in Braille, and on cassette by

              THE NATIONAL FEDERATION OF THE BLIND

                     MARC MAURER, PRESIDENT


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                   Baltimore, Maryland  21230
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ISSN 0006-8829


                            Contents


Special Note From the Editor

Jury Comes Down Hard on Maxi-Aids
     by Barbara Pierce

        Copyright  1998 National Federation of the Blind


[PHOTO/CAPTION: Barbara Pierce]
                  Special Note from the Editor
                           **********
     Occasionally in the blindness field a circumstance so
extraordinary arises that it demands unusual treatment in these
pages. The recent U.S. District Court decision in the Eastern
District of New York in the case of Independent Living Aids
versus Maxi-Aids is such an instance. The entire March issue is,
therefore, devoted to telling the story of this case as it
unfolded. We have tried to do so chiefly in the actual words of
the trial transcript prepared by the court reporter, so to the
lay mind the narrative line may sometimes seem somewhat
repetitive and slow-moving. But it seemed important as far as
possible to let the principals tell the story in their own words
and to let their actions, as described in their testimony, speak
for themselves.
     It is important, however, to remember that the case is by no
means over. As the counsel for the defense, Mark Mulholland,
Esq., told me in no uncertain terms, this decision was only the
first round in this case. He explained that in copyright
infringement cases the initial damages established by the jury
are quite likely--more likely than in almost any other type of
case--to be reduced by later court action.
     Nonetheless, for four weeks people testified in open court
about the actions of the defendants and the plaintiff and the
policies of the two companies. After hearing the evidence and
spending time carefully considering what they had heard, a jury
came to certain conclusions. That story and those conclusions
have implications and repercussions for the entire blindness
field. For this reason we have devoted the March issue to an
account of this trial and only this trial. The April issue will
be published soon and will contain the convention information for
which everyone has been eagerly waiting. Meanwhile we commend to
your attention the important matter of Independent Living Aids
and Marvin Sandler versus Maxi-Aids and the Zaretsky family. Read
carefully and ponder.
                           **********
                           **********
[PHOTO/CAPTION: Marvin Sandler
PHOTO/CAPTION: Dr. Mimi Berman
PHOTO/CAPTION: The Independent Living Aids logo
PHOTO/CAPTION: The stylized title that appears on the Maxi-Aids
catalog
PHOTO/CAPTION: The Slimline Lo-Vision watches that Marvin Sandler
believed had been reproduced in the 1991 Maxi-Aids catalog and
called Ultima low-vision watches.]
                Jury Comes Down Hard on Maxi-Aids
                        by Barbara Pierce
                           **********
Note: As background for this article, Monitor readers may wish to
review the article entitled "Was it Swiss or Hong Kong: The Story
of Maxi-Aids," which appeared in the December, 1994, issue of the
Braille Monitor.
                           **********
     On November 5, 1997, a jury of four men and five women filed
into a United States District courtroom to hear the case of
Independent Living Aids (ILA) versus Maxi-Aids. Thirty-three days
later, following two and a half days of deliberation, the jury
returned to that courtroom to announce its verdict. It had found
Maxi-Aids guilty of infringing on ILA's copyrighted catalogs over
a ten-year period, infringing on the ILA trademark, and engaging
in deceptive advertising and unfair business practices. The first
two charges were federal, and the last two were New York state
charges.
     The jury awarded damages of $2,400,000.06. The judge will
determine later whether and how much to assess Maxi-Aids to
offset ILA's legal fees, but he indicated that he was inclined to
make a sizable award; the attorney for Marvin Sandler, who is the
owner and chief executive officer of ILA, has submitted a bill of
$428,000 to the judge.
     The trial was extraordinary in every way. The level of
animosity between the plaintiff and the defendant in a small
market like the blindness and disability field is perhaps not
surprising. But, according to the court reporter in the case, who
has worked in the Federal Circuit Court in the Eastern New York
district for about twenty years, the size of the award is almost
unprecedented. According to him, the huge awards that make the
news periodically are made by juries in state courts in cases in
which there are punitive damages due to personal injury.
     Maxi-Aids will almost certainly appeal this decision, so the
case is most probably far from over. But the seriousness of the
charges, the unsavory behavior of Maxi-Aids as laid out in the
testimony, the significance of the verdict, and the size of the
jury's award make the case absolutely unique in the blindness
field. For these reasons the case is worthy of careful
examination. Unfortunately, when contacted, Mitchel Zaretsky
refused to make any comment about the case or answer any
questions because, he said, "The case is not over."
     Though the charges go back to 1985, the first detailed
public discussion of the Maxi-Aids problem took place in the
December, 1994, issue of the Braille Monitor. (See the article,
"Was it Swiss or Hong Kong: The Story of Maxi-Aids," which
appeared in that issue.) In January, 1994, Marvin Sandler, co-
owner with his wife Dr. Mimi Berman of ILA, wrote a letter to Dr.
Jernigan detailing a number of allegations against Maxi-Aids and
its owners: Elliot Zaretsky and his children--Mitchel, company
president; Harold, who is deaf; and Pamela Stein. Stein is not
now an owner, but exactly when she ceased her ownership became
quite an interesting issue during the trial.
     Throughout 1994 Dr. Jernigan gathered letters from vendors
in the blindness field reporting on the Zaretskys' unsavory
business practices as the writers had experienced them. We
interviewed a number of people, including Elliot and Mitchel
Zaretsky, in preparing the story. As soon as Dr. Jernigan had
contacted the Zaretskys for comment in early December, according
to Sandler's testimony, Elliot Zaretsky called and threatened
him. On February 15, 1995, Marvin Sandler filed suit against
Maxi-Aids and the Zaretskys. In April, 1995, Maxi-Aids counter-
sued for libel and defamation of character because of Sandler's
letter published in the Braille Monitor article.
     At once both sides began taking depositions and preparing
for trial, but it took them and the legal system two and a half
years and one mistrial to get to the November, 1997, hearing.
Both sides were represented by bright and competent legal
counsel. The principal Zaretsky lawyer was Mark S. Mulholland,
and Sandler's principal lawyer was Jack S. Dweck. The judge was
Arthur D. Spatt, United States District Judge. To follow the
portions of the trial transcript included in this article, it is
important to recognize the names of the principal participants.
     Unraveling the many strands of this case has been a
formidable task. The trial transcript runs to over 3,400 pages.
Through the years I have read my share of court decisions. I have
even read and corrected my own several-hundred-page deposition.
But never before have I read most of an entire trial transcript.
Several points leapt out from the text. It was immediately clear
that the judge was eminently fair and conducted the trial with
humor and consideration.
     The jury was extremely conscientious. From comments made by
both lawyers and the judge, one gathers that this jury carefully
followed the arguments and the testimony, using the copies of
documents provided to them. In fact, Marvin Sandler told me that
at the close of the trial the judge told them to clear all the
material from his courtroom in a hurry because he was starting
another trial. All the jurors' document boxes ended up in
Sandler's possession. In looking through these he read the
comments the jurors had made on their pads. He says it was clear
that they were carefully following the arguments and
intelligently assessing the evidence as they went along.
     Throughout the trial both lawyers demonstrated the courtesy
of gentlemen. They were respectful at all times and genuinely
seemed to be trying to conform to the judge's rules. They were
not pushing the limits of his rules as lawyers seem to do in
novels and on television. In fact, they bent over backwards to be
polite and patient. The entire proceeding was civilized to an
almost startling degree. The only possible exception to the
general civility was the occasional flashes of temper,
sullenness, and ill-temper on the part of various members of the
Zaretsky clan. The following is a brief excerpt from early in
Elliot Zaretsky's testimony on November 24, 1997, that shows Mr.
Zaretsky's unwillingness to answer questions simply and clearly
and the humor and firmness of the judge: Jack Dweck is
questioning Elliot Zaretsky about several answers he had given
during his deposition.
                           **********
Q: Mr. Zaretsky, you remember giving testimony before trial in
this case?
A: Yes, I do.
Q: Do you remember, sir, Mr. Hubell [ILA's assistant counsel] was
the one that questioned you on each of these dates, January 30,
1996--
THE COURT: You will not go through all of that, are you? He was
questioned--There's a stack about a foot high, full of
transcripts. You have to be an endurance runner--Mr. Hubell is to
be congratulated, and we'll award him a medal.
MR. MULHOLLAND: What about me, Judge? I was there too.
THE COURT: We'll give each of you a medal. We'll give you the
Bronze Star, not great, but very good. Very good. Not giving you
the Silver Star, Congressional Medal of Honor, or--because you'll
have to fill the room with transcripts [to deserve that medal].
THE WITNESS: Your Honor, may I say something?
THE COURT: No, you may say nothing.
THE WITNESS: Thank you.
BY MR. DWECK: [resuming his questions]
Q: You remember when you were questioned by Mr. Hubell on all of
those dates for which he has just been given a medal, you were
under oath, correct?
A: That's correct.
Q: Did you give this answer to this question, sir, on page 14,
line 11?
          Question: "How did you come to acquire ownership of the
shares that were originally held by Pamela Stein?"
          Answer: "She left the company."
Did you give that answer to that question, sir? Yes or no, sir?
A: She left the company for--
MR. DWECK: Your Honor.
THE COURT: Listen to me, Mr. Zaretsky. Let's start off on the
right track.
THE WITNESS: Yes, Your Honor.
THE COURT: You're an intelligent man. You understand what he's
telling you, don't you--
THE WITNESS: You know my problem is--
THE COURT: No, don't give me your problem. Do you understand what
he's saying?
THE WITNESS: Yes, Your Honor.
THE COURT: If you don't understand, say so. Were you asked that
question and did you give that answer? That's all.
THE WITNESS: I do not recall. . . .
Q: The next question. Did you give this answer to this question,
sir?
          Question: "When was that, sir?"
          "Answer: "I'm not too sure of the date."
Did you give that answer to that question, sir?
A: Yes.
Q: Mr. Zaretsky, at page 15, the very next page, did you give
this answer to this question, sir, line 20?
          Question: "Does she still own shares in the
corporation?"
          Answer: "Sort of, yes."
Did you give that answer, sir?
A: Yes.
Q: Mr. Zaretsky, will you agree with me, sir, that from the time
you took over Pamela's shares in 1988, Pamela has not been an
owner of the company?
A: On paper, sir.
Q: On paper, agreed, yes?
A: On paper, yes.
Q: Mr. Zaretsky, that would mean on paper, as far as the federal
government was concerned, Pamela did not have any ownership in
the company from the time you got her stock on January 1, 1988;
is that right, sir?
A: That's correct.
Q: And from 1988 right until now, as far as the federal
government was concerned, whether it is for income tax purposes
or any other purposes, Pamela was not an owner. Agreed?
A: Agreed.
                           **********
                     The Copyright Question
                           **********
     According to Marvin Sandler's testimony, Independent Living
Aids was started in 1977 as one of several companies owned by the
Sandler family. In April of 1987 he and his wife actually bought
ILA from the family and actively took over its management
themselves. His wife held 60 percent of the stock, and he held
the rest and acted as president. In February, before this
transfer, the ILA catalogs of several of the Sandler companies
were taken to a firm of copyright attorneys so that all the
catalogs could be copyrighted in a group. Copyrights can be
obtained after publication, and the ILA catalogs from 1985 on
were included in this group of documents. Entered into evidence
at the trial were ten copyright certificates from the U.S.
Copyright Office for ILA catalogs beginning with 1985.
     Notwithstanding this obvious proof of copyright, many hours
of questioning in the trial were devoted to such issues as
whether or not it was reasonable for ILA to copyright such a
document. The Zaretskys maintained that everybody received
pictures from manufacturers of the products, so those could not
be exclusive to one company. Sandler pointed out in excruciating
detail the things he had done to set his catalog apart from
others. He inserted pithy little sayings and quotations. The ILA
catalogs included service announcements about free materials
available to disabled people. Many of the photographs that were
used in the ILA catalog Sandler testified were demonstrably taken
by his photographers, and the catalog order numbers were specific
to his company. ILA began producing a color catalog on slick
paper, so it had quite a different appearance from the Maxi-Aids
catalog, which was produced on newsprint with black-and-white
pictures.
     Sandler maintained, and produced charts and blow-ups to
support his contention, that Maxi-Aids had taken his order
numbers and converted the first number into the letter
corresponding to it in the alphabet--7 to G, 8 to H, etc. He also
pointed out that the organizing principle for Maxi-Aids's listing
sewing products, for example, turned out--by no coincidence to
his way of thinking--to be identical to that in the ILA catalogs.
     Mulholland argued for the Zaretskys that the catalogs were
always different colors. The cover layouts were different. Maxi-
Aids carried many more products than ILA did, and they often
charged less. There were lots of instances in which both
companies used photos provided by manufacturers. All this
demonstrated that Maxi-Aids was not infringing on copyright.
Furthermore, ILA had no right to obtain copyrights on its
catalogs anyway because no one had done that before, and
everybody copied from everybody else anyway. But the jury didn't
buy it.
     Elliott Schreier worked for the American Foundation for the
Blind for some years. According to the 1994 Braille Monitor
story, he visited the Maxi-Aids offices, where Zaretsky offered
him a bribe. Since bribery charges were not at issue in this
trial, that part of his story could not be admitted into
evidence. But this is what he did say in answer to Jack Dweck's
questions on the stand:
                           **********
Q: And tell us, please, what you observed in that room, at the
time that Mr. Elliot Zaretsky told you this was the development
room for their catalogs?
A: At that time I observed stacks of catalogs of the companies
involved in the blind and vision-impaired business, and it would
be ILA; Vis-Aids; AFB, the organization I worked for. There was a
drafting table or production type of table. There were knives,
scissors, glue, equipment used primarily in cutting and pasting
of catalogs.
Q: When you say in cutting and pasting of catalogs, did you
actually see this operation?
A: I don't believe there was anybody there at the time cutting
and pasting, but there was certainly the appearance that that is
the type of activity ongoing there with scraps of paper, scraps
of materials and catalogs, as well as the stacks of catalogs.
MR. MULHOLLAND: Objection. Move to strike.
THE COURT: Sustained. Strike out the entire last answer. He was
asked if he saw anybody cutting and pasting. He said no. Other
than that the entire answer is stricken. The jury is instructed
to disregard it.
Q: Now, at that time did you have a conversation, a further
conversation with Elliot Zaretsky?
A: I had mentioned to Elliot in passing whether or not this is
where one of the pictures in their catalog of an AFB product we
had designed had been taken and cut and pasted into their
catalog. And the conversation--he indicated yes, it was, and that
this was part of the way that costs were kept down, by using
other people's photographs and components in developing their
catalog.
Q: And, Mr. Schreier, did you have any further conversation with
Elliot Zaretsky at that time, sir?
A: I don't recall so.
Q: Now, how do you know that there were other companies' catalogs
in this room?
A: I saw them.
Q: What is the basis of your statement, sir, that you saw ILA
catalogs or AFB catalogs?
MR. MULHOLLAND: Objection. No such testimony, Judge.
Q: Well, the witness said he saw catalogs.
THE COURT: What catalogs did you see while you were in the
defendant's facilities?
THE WITNESS: I remember seeing--
THE COURT: You are getting back to flank speed again.
THE WITNESS: Sorry.
THE COURT: You are not designing catalogs now. You are in a
courtroom. So slow down.
THE WITNESS: Sorry.
THE COURT: We don't pay by the hour here. Slow down.
THE WITNESS: Okay.
THE COURT: Now, tell us what catalogs you saw. I lost you.
THE WITNESS: AFB, the organization I worked for; Independent
Living Aids; Vis-Aids. Those three I specifically remember.
                           **********
                             Watches
                           **********
     From the beginning one of Marvin Sandler's biggest
complaints against Maxi-Aids concerned Braille and low-vision
watches. The Maxi-Aids catalog through the second half of the
eighties included pictures of ILA watches, most of which
conspicuously included the ILA logo. Sandler argued that this
indicated that Maxi-Aids was using a competitor's photos and then
undercutting its prices. Elliot Zaretsky explained, however
implausibly, that he had bought a small number of ILA watches
from ILA in 1986. The same year he bought other ILA watches from
another company at a much-reduced price. This enabled him to sell
ILA watches from 1986 through 1989 at half the ILA price.
Sandler, however, testified and assured the Braille Monitor in an
interview that he never sold any watches to Maxi-Aids and would
not have sold them to a close-out house while he still carried
them at full price in his own catalog. He also said that he had
conducted a search for evidence that ILA watches might have been
sold to Maxi-Aids before he and his wife took over in 1987. He
found nothing to indicate that such a sale had ever taken place.
Here is Elliot Zaretsky's testimony on the point. It begins with
a reference to two ILA watches by their ILA and then Maxi-Aids
order numbers:
                           **********
BY MR. DWECK:
Q: You got 856824 from ILA, that's your testimony, correct?
A: I got watches from ILA.
Q: Is that correct, sir?
A: Yes.
Q: And you got 856825 from ILA, correct?
A: That's correct, sir.
Q: And you put them in your catalog for half the price that ILA
had them; isn't that right, sir?
A: That's correct.
Q: And you were losing money on those watches?
A: No, because I bought it from--
MR. DWECK: Your Honor, I move to strike anything below or after
the word "no."
THE COURT: Motion granted. Strike out everything after the word
"no." Just listen to the question, Mr. Zaretsky. Try to answer
yes or no, if you can. If you can't, say I can't answer yes or
no. But please, no explanations. Do you understand, Mr. Zaretsky?
THE WITNESS: Yes, sir. Yes, Your Honor.
BY MR. DWECK:
Q: Mr. Zaretsky, in the following year, in 1987 you showed the
same watches, 856824 and 856825; isn't that right, sir?
A: Yes.
Q: And you again had them at almost half the price of ILA; isn't
that right, sir?
A: That's correct.
Q: Mr. Zaretsky, you featured those same watches again in your
1987 second edition, and you again had them at almost half the
price of ILA's price; isn't that right, sir?
A: That's correct, sir.
Q: Mr. Zaretsky, in the summer of '87 catalog you did it again,
didn't you, sir?
A: Yes.
Q: For half the price of ILA, less than, or rather half the price
of ILA?
A: Yes, sir.
Q: Mr. Zaretsky, you bought ILA watches from Around the World
Distributors, is that your testimony, sir?
A: Yes.
Q: And that was in 1986, according to your testimony, correct?
A: I would say so. Around that period.
Q: That's about the same time you bought them from ILA; isn't
that right, sir?
A: I would say so.
Q: Mr. Zaretsky--
A: I do not recollect exactly.
Q: Mr. Zaretsky--
A: Yes.
Q: --Why go to a distributor when you could have bought them all
from ILA?
A: I'll give you a very good reason, sir. . . .
Q: Let me ask it this way, sir.
Q: You bought them from ILA in '86, right?
A: Yes.
Q: And you bought them from a distributor, according to your
testimony, Around the World Distributors, in '86?
A: That's correct.
Q: And you didn't buy all of them from ILA in '86; is that
correct?
A: Not all of them, no.
Q: Mr. Zaretsky, you had an account with ILA in '86?
A: I'm almost 99.9 percent, yes.
Q: At the same time that you had this account that you're 99.9
percent sure of, you were buying watches from a distributor, sir?
A: Yes.
Q: In the same year?
A: In the same year.
Q: And selling them at half price?
A: I could afford it, yes.
Q: You could afford it in the first year you were in business; is
that right, sir?
A: Yes, sir, very much.
Q: And the second year you were in business?
A: Yes.
Q: And the third year?
A: Yes.
Q: And the fourth year you were in business, '89; isn't that
right, sir?
A: '89 is not the fourth year, sir; it's the third year.
Q: I'm sorry.
A: Okay.
Q: And you could afford it in that year too?
A: That's correct.
Q: To sell them at half price?
A: Yes, very much so.
Q: Mr. Zaretsky, do you have even a single invoice to show the
purchase of any of these watches from ILA?
A: Mr. --
Q: Yes or no, sir?
A: No, sir.
Q: Do you have a single invoice to show that you purchased these,
sir, from this company "Around the World Distributors"?
A: Mr. Dweck, it was twelve years ago. I do not recollect. I do
not know.
Q: Well, either you have the invoice, sir, or you don't have it.
A: I do not have it now. . . .
[From the redirect examination of Elliot Zaretsky the following
day: ]
Q: Mr. Zaretsky, when you submitted the ILA watches in your
catalog, did you supply ILA watches to anybody that ordered them,
sir?
A: Yes.
Q: Mr. Zaretsky, when you purchased the ILA watches, was it from
Mr. Sandler?
A: Say that again?
Q: I said, when you bought these watches that you say you bought
from ILA, did you buy them from Mr. Sandler (indicating)?
A: As I told you yesterday, I don't remember who it was that I
bought it from. From ILA, yes. I don't remember the gentleman's
name.
Q: Was it Sandler?
A: I don't think so.
Q: Mr. Zaretsky, you said that you bought about 100 watches from
ILA; is that right, sir?
A: I don't remember exactly the number, but I would say so. Maybe
more or less.
Q: Was that the supplier of the watches that you used for three
years in a row in the catalog?
A: Almost.
Q: Mr. Zaretsky, the rest of the watches that you had for three
years in your catalog were the ones you bought from this Around
the World Distributors that you are telling us?
A: Yes.
Q: And you didn't buy very many from them, did you?
A: They had quite a bit of them.
Q: They had quite a bit of them?
A: Yes.
Q: How many did you buy from them, more than 500?
A: Less than 500.
Q: More than 250, sir?
A: Well, there was a mixture of low vision watches and Braille
watches, sir.
Q: Mr. Zaretsky, was it more than 250 in the whole mixture that
you bought from Around the World Distributors?
A: Honestly I don't recall, sir.
Q: But it was less than 500?
A: Yes.
Q: And about 100 from ILA, that would be less than 600
altogether, from both sources?
A: That's correct.
Q: And are you telling this Court and jury that, for every watch
you sold for the three years that you featured them in your
catalog, you lost like $25 and $30 a watch?
A: No, sir, I paid only $5--can I say it?
Q: Are you telling us you lost $20 to $30 a watch?
A: No, I didn't lose any money.
Q: I thought five minutes ago you said you could afford it?
A: I could afford it. I did not lose any money. That's exactly
what I said.
                           **********
     Then there was the problem of Maxi-Aids selling low-vision
watches that arrived in boxes that conspicuously said "Swiss,"
but the watches were actually equipped with Japan movements or
made in Hong Kong. The Maxi-Aids catalog pages showing the
watches included the word "Swiss" but also bore asterisks that
were otherwise unexplained. Here is Mitchel Zaretsky's
explanation under questioning by Jack Dweck of what the asterisks
meant and how the footnote warning buyers that the models with
the asterisks were made in Hong Kong had fallen off the galley of
the first catalog in question, and the error had not been noticed
the next year:
                           **********
Q: Mr. Zaretsky, when you advertised in your catalog, sir, for
1993, you had the Ultima low-vision black face with the asterisk;
is that right, sir?
A: Yes.
Q: And that's what you told this Court and jury the other day,
was where the asterisk fell off the galley that you sent to the
printer; is that right, sir?
A: No. I said the footnote.
Q: I am sorry, the footnote fell off the galley; is that right?
A: Yes.
Q: Mr. Zaretsky, you didn't have any other notation of Hong Kong
or HK on this 1993 price list besides these two asterisks, which
you testified belonged to a footnote that fell off the printer's
galley; is that right, sir?
A: Yes.
Q: Mr. Zaretsky, do you have that galley [proof] with you today,
sir?
A: No, we do not.
Q: Does it exist, sir?
A: Not to my knowledge.
Q: Mr. Zaretsky, when you did the 1994 catalog, you put asterisks
again, did you not, for the same two watches?
A: No. It was the same galley.
Q: Did you put the--
MR. DWECK: Move to strike, your Honor.
THE COURT: After the word "no" strike it out.
Q: Does your 1994 price list contain two asterisks for the same
two watches, B-11 and B-12, as they appear on the 1992 price
list?
A: Yes, they do.
Q: Is it your testimony, Mr. Zaretsky, that the footnote fell off
the galley the second year?
A: No. We just didn't observe it.
Q: Mr. Zaretsky, in 1993 you had the same watches, B-11 and B-12;
is that right, sir?
A: Yes.
Q: And on this photograph you have no asterisk, do you, sir?
A: No.
Q: And there is no HK on it, is there, sir?
A: Not on this one.
Q: There is nothing then to denote that these are watches from
Hong Kong, is there, sir? Do you want me to bring it a little
closer?
A: Only the movement on the watch.
Q: There is nothing--you can't read anything on this watch, can
you, sir?
A: No.
Q: You can't read anything on here (indicating), can you?
A: No.
Q: And, Mr. Zaretsky, in 1995 [immediately following publication
of the Braille Monitor story about the Hong Kong watches], when
you had this catalog, you put HK below those watches; isn't that
right, sir?
A: Yes, we did.
Q: And there is no legend anywhere on this page of what HK means,
is there, sir?
A: No.
Q: And there is no legend on the page with the prices on there
indicating what the HK stands for, is there, sir?
A: No.
Q: Mr. Zaretsky, you did put a legend on the price list page, "E
means expansion," right?
A: Yes.
Q: You put another legend, "L means leather," on the top of the
page; is that right, sir?
A: Yes.
Q: So, we have a legend for expansion band and leather band, but
no legend for what HK means, is that correct? Isn't that right,
sir?
A: Yes.
Q: Mr. Zaretsky, in 1992, Exhibits 14-A and 14-B, you have no
indication of HK on those watches either, do you, sir, B-11 and
B-12?
A: No. I thought we just went over that.
Q: Am I right about that?
A: No HK.
Q: No HK?
A: Right.
Q: And there is no HK on this 1992 catalog sheet, page 19, for
those watches either; is that correct?
A: No.
Q: And you can't read anything on the bottom of these watches
that shows either a Japan or Chinese movement or anything like
that; is that right, sir?
A: No.
Q: And you will agree that this blowup is probably 15 times the
size of your catalog?
A: I don't know the exact percentage. It is bigger.
Q: Okay. And, Mr. Zaretsky, in your 96-97 catalog you put black
print on top of a black band below B-11 and B-12, which reads, if
you can read it, Hong Kong; isn't that right, sir?
A: Yes.
Q: And this catalog is for low-vision people also; isn't that
right, sir?
A: Yes, it is.
Q: And you were talking about the contrast of the letters and the
numbers on the black face with the white face, or the white
numbers on the black face, and the black numbers on the white
face?
A: Yes.
Q: And, Mr. Zaretsky, where you put Hong Kong on this catalog, it
is black on black, isn't it, sir?
A: Not everywhere.
Q: Where it says Hong Kong, it is black on black, isn't it, sir?
A: Not in this catalog.
Q: Mr. Zaretsky, this is a 1996-1997 catalog. That's black on
black, isn't it, sir?
A: On this location, but not on others.
Q: Is that a yes or no?
A: In this location it is black on gray, yes.
Q: Black on gray. Would you say, sir, being in the catalog
business for low-vision people, that is suitable for a person
with low vision to see?
MR. MULHOLLAND: Objection.
THE COURT: Overruled.
Q: Black on gray as you put it, sir.
A: Yes.
Q: That's suitable for a low-vision person to see?
A: They might have a hard time with that.
Q: Mr. Zaretsky, you continued the black on black, or black on
gray, as you put it, with the Hong Kong, B-11, B-12, into the
1998 catalog, didn't you, sir?
A: On that page, yes.
Q: I am only talking about B-11 and B-12.
A: It appears elsewhere.
Q: Mr. Zaretsky --
 MR. DWECK: Move to strike, your Honor.
THE COURT: Motion granted. Strike it out.
Q: Mr. Zaretsky, follow my question. If you have trouble tell me;
I will change it.
A: Okay.
Q: On B-11, B-12, in your 1997-1998 catalog, you put the words
Hong Kong, in black on black, didn't you, sir?
A: On the photograph, yes.
Q: Would you say it is suitable for a person of low vision to see
or read?
A: They might have a hard time with it.
Q: Mr. Zaretsky, when Mr. Mulholland was questioning you
yesterday, I believe you testified, sir, that these were not
copied into your catalog; is that right, sir?
A: To the best of my knowledge, that's correct.
Q: And, Mr. Zaretsky, you would agree with me, sir, that this is
that copy of page 19 from your '92 catalog?
A: Yes.
Q: And these are the Ultima low-vision quartz [watches]; is that
right, sir?
A: Yes.
Q: And your testimony in response to a question from Mr.
Mulholland was that these were not copied from an ILA brochure or
catalog; is that right, sir?
A: To the best of my knowledge, yes.
Q: Mr. Zaretsky, the reason you said--the reason you said that is
because the hands didn't line up on both watches; isn't that
right?
A: That's part of the reason, yes.
Q: Mr. Zaretsky, I am going to have these two cut-outs, which I
represent to the Court are from the ILA Exhibit 10, put on--
superimposed on your page 19. Would you agree with me, Mr.
Zaretsky, that those watch cutouts came from an ILA brochure,
Exhibit 10?
A: No.
MR. MULHOLLAND: Objection.
THE COURT: Overruled.
MR. MULHOLLAND: I don't know what he is referring to, the cutouts
that he pasted on or what was on the face of the catalog.
THE COURT: Does the witness know what he was referring to?
MR. DWECK: He knew. These items here.
THE COURT: Excuse me. Did you know what he was referring to?
THE WITNESS: The cutouts he made from his brochure, he was asking
me if they were the same as the images depicted on my catalog.
And my answer was no.
THE COURT: Very well.
                           **********
     Marvin Sandler explains that during the last part of that
testimony, while Dweck was talking about the cutouts from the ILA
brochure depicting two low-vision watches, Sandler was moving to
the blow-up of the Maxi-Aids catalog picture of two watches and
arranging and then taping the cutouts onto the large picture so
that they exactly mirrored the Maxi-Aids pictures. Zaretsky had
maintained that the two watches in his catalog were in different
positions in relation to each other than the ILA watches were in
the ILA brochure. Sandler says that his action demonstrated to
the jury conclusively that the pictures of the two watches were
identical in the two catalogs.
     In 1991 the Texas Commission for the Blind put out bids for
a number of items for purchase. When taxed with having submitted
an ILA watch as the sample of the Maxi-Aids product for bid,
Mitchel Zaretsky explained that, since the ILA watch had been the
standard, he was merely indicating that he was prepared to
provide that quality watch. He said that he sent pictures of the
ILA watches to Hong Kong manufacturers only to get cost
information for the Texas bid so that he could produce the same
watch with a Maxi-Aids logo instead of the ILA one. He denied
that he had been arranging to produce a knock-off of the ILA
watches. The only problem with this explanation was that Jack
Dweck produced the Maxi-Aids bid to the Texas Commission, which
was dated in July of 1991, and also the faxes to Hong Kong, which
demonstrated that the first one was sent in September. So
Zaretsky's alleged inquiry about production took place at least
two months after the bid for those watches had been submitted.
                           **********
                         The Tab Grabber
                           **********
     A recurring theme throughout the trial was the Maxi-Aids
practice of advertising one product and substituting another for
it. The tab grabber is a case in point. Marvin Sandler describes
this small tool as an aid to opening soft-drink cans using a slot
on one end and opening bottles using a fluted hole at the other.
Sandler says that it is helpful to people with arthritis and to
those like airline cabin personnel who have lots of bottles and
cans to open. Here is Jack Dweck questioning Elliot Zaretsky
about first the Maxi-Aids simple soft-drink can opener that Maxi-
Aids sold and identified by sticking on a label as a tab grabber
and then the ILA product, which includes the fluted hole for
opening bottles.
                           **********
THE COURT: What is this?
MR. DWECK: That's the product that Mr. Zaretsky just identified
as the tab grabber that Maxi-Aids ships in response to the
advertisement contained in their catalog.
THE COURT: Any objection?
MR. MULHOLLAND: No objections, Judge.
THE COURT: Plaintiff's Exhibit 29 in evidence.
(Plaintiff's Exhibit 29 received in evidence.)
Q: Mr. Zaretsky, on the card on which this product comes, it says
"magnetic pull top can opener," correct?
A: Mr. Dweck, the way you describe it--
MR. DWECK: Your Honor, I'm going to again object to Mr.
Zaretsky's editorializing, Judge.
THE COURT: Well, I'm going to strike the answer. The jury is
instructed to disregard it.
BY MR. DWECK:
Q: Mr. Zaretsky, can we read this together, sir? "Magnetic pull
top can opener."
A: That's correct.
Q: And can you read for the Court and jury the description you
have in your 1993-1994 catalog for the tab grabber?
A: "The tab grabber opens cans and soda bottles easily. Excellent
for people with arthritis. Opens cans and bottles instantly and
safely. It is magnetic so you can keep it on the refrigerator
door." I'm sorry. "Has a magnet so you can keep it on the
refrigerator door."
Q: Mr. Zaretsky, I have this bottle for you, sir. Will you please
demonstrate to the Court and jury how your product which you
advertise as a tab grabber opens cans and soda bottles easily?
A: It opens cans very easily, but it is not made for this screw-
on cap; it's made for a lift-off cap.
Q: So are you telling me, sir, that that item will not open up
this bottle?
A: Not a screw-on cap. We never said a screw-on cap.
MR. DWECK: Motion to strike.
THE COURT: Motion granted. Jury is instructed to disregard.
Q: Are you telling this Court and jury that that product will not
open up that product, Mr. Zaretsky?
A: It will not--
Q: Yes or no, sir?
A: It will not open this particular bottle.
MR. DWECK: I'll take that, Judge.
Q: Mr. Zaretsky, I'm now going to hand you this item and ask you
if you can identify this item as a tab grabber opener.
A: This is a different type of grabber.
Q: Does that mean yes?
A: Yes, it is.
Q: And would you agree with me, Mr. Zaretsky, that that product
is labeled "tab grabber"?
A: Yes, it is.
Q: Mr. Zaretsky, would you please, sir, using that item, open the
bottle.
A: First of all, it is very difficult for an arthritic person to
open it.
MR. DWECK: Objection, Your Honor.
THE COURT: Motion granted. Strike the answer as not being
responsive.
THE WITNESS: I cannot open this bottle.
MR. DWECK: May I ask, with your permission, to allow Mr. Sandler
to open that bottle with that item.
THE COURT: Yes.
(Mr. Sandler opens the bottle.)
THE WITNESS: Very good.
BY MR. DWECK:
Q: Mr. Zaretsky, is it correct, sir, that your product which you
advertise as a tab grabber will not open that bottle?
A: It wasn't meant to open up this bottle, no.
Mr. DWECK: Move to strike, Your Honor.
THE COURT: Motion granted. Strike the answer as not being
responsive.
THE WITNESS: I'm sorry.
BY MR. DWECK:
Q: Is it your testimony, sir, that your item will not open up
that bottle?
A: That's correct.
Q: Would you agree with me then, sir, that the description
contained in your advertisement in your catalog 1993-94 is
incorrect when it states "tab grabber opens cans and bottles
easily"?
A: I do not agree with you, sir.
MR. DWECK: Move to strike on the ground it is not responsive,
Your Honor.
THE COURT: It is responsive. He says no.
MR. MULHOLLAND: Thank you, Judge.
MR. DWECK: Okay.
BY MR. DWECK:
Q: Now, sir, --
THE COURT: What page was that on?
MR. DWECK: That was page 72.
JUROR NO. 4: 72.
JUROR NO. 3: 72.
MR. DWECK: 72 is right, Your Honor.
Q: Now, Mr. Zaretsky, would you agree with me, sir, that Maxi-
Aids advertised that same tab grabber that I showed you from your
1993-1994 catalog, from 1986 right into the present catalog 1997?
A: Honestly, I do not know what has been advertised.
THE COURT: You are not going to go through all of these catalogs.
If you say it is, we'll take your word for it, right, Mr.
Mulholland?
MR. MULHOLLAND: I'll read them later on, Judge; then I'll take
his word for it.
THE COURT: All right. Go ahead.
MR. MULHOLLAND: Judge, we can concede for now. If I feel there is
something that I have to bring to the Court's attention, I'll do
that later on.
THE COURT: All right. You don't have to go through all of these.
BY MR. DWECK:
Q: Would you agree with me, sir, that you advertised a "tab
grabber" from your 1986 catalog right into your 1997 catalog?
A: I'll be honest with you, I do not remember what we advertised.
THE COURT: All right. Is it in there?
MR. DWECK: Yes, it is, Your Honor.
THE COURT: Okay. We'll accept your word as an officer of the
Court that it is in there.
                           **********
                    The Voice Print Telephone
                           **********
     Then there was the Voice Print telephone. ILA, according to
Sandler's testimony, sold one model of this item for $199.95.
Maxi-Aids sold the other model for $149.95. Fifty telephone
numbers could be programmed into the Maxi-Aids version and 100
numbers into the ILA model so that the user could speak a name
and have the phone dial that number. The equipment was voice-
activated. The importer discontinued carrying this product in the
early nineties, leaving both vendors without the option of
reordering the units. Sandler says that he had bought a good
number, so he was set for some time to come. But Maxi-Aids had a
problem. According to Sandler, during a pretrial hearing in June
of 1995, Mitchel Zaretsky told Judge Wexler that the importer
assured him that he could easily substitute Radio Shack
telephones, which he did.
     The trouble was that the Radio Shack phone had a memory of
twenty names and numbers and required the user to push a button
to initiate its use, so it was, according to Sandler, a very
different unit from the one still being advertised by Maxi-Aids
and could not be used, for example, by quadriplegics.
     According to Sandler, Mitchel Zaretsky testified before
Judge Wexler that he bought Radio Shack phones at about $112 and
continued to sell them at $149.95. Customers began noticing that
they could buy the Radio Shack phone for $99.99 in the store.
Judge Wexler asked Zaretsky, according to Sandler, why he did not
stock up on the phones at that price, but Zaretsky said that he
had a good number on hand and did not need more.
     Among the Maxi-Aids documents turned over to the plaintiff
before the trial began was a receipt from Radio Shack dated
December 22, 1994. It was for the purchase of forty of these
phones at $99.99. There was quite a bit of discussion as to
whether or not this receipt could be admitted into evidence
without bringing in a Radio Shack official to identify it as an
actual Radio Shack document. Whether or not Zaretsky bought the
units for $112 or $99.99, it is indisputable that Maxi-Aids was
making $38 to $50 profit on each unit sold and delivering a unit
that did not perform as advertised in the catalog. Sandler
reports that at one point Mitchel Zaretsky commented that no one
had ever complained about the diminished capabilities of the
Radio Shack telephone, as though that justified the Maxi-Aids
decision to make the substitution.
                           **********
                            Say When
                           **********
     In about 1980 Dr. Tim Cranmer, a leader in the National
Federation of the Blind of Kentucky and associated at the time
with the Bureau for the Blind in that state, began working with a
couple of Bureau employees to design a liquid level indicator
which eventually became the Say When(R). Kentucky Industries for
the Blind, also a division of the state's vocational
rehabilitation agency, recognized the value of this little
product and made plans to manufacture it, using blind and
visually impaired people to do the production. They took the
precaution of having the name trademarked and began production
with two people working every day on the job.
     During the early eighties, according to Bob Byrd, Director
of Kentucky Industries, sales began to take off. Not only were
the catalog houses ordering the units for resale in their
catalogs, but state agencies, individuals, and even agencies
around the world began ordering the product. Kentucky Industries
for the Blind eventually put three blind people to work full-time
on the project, and they were turning out 2,400 units a month.
They sold for $13.95 and held up well under steady use. At its
peak the Say When was generating $700,000 a year in sales for KIB
and was providing very fine jobs for three blind people.
     Then, Byrd reports, in the early nineties business began to
fall away. They soon discovered that Maxi-Aids was selling a
product called Say Stop, which was also a liquid level indicator,
and the price was $1 less than the Say When. As people began to
contact Kentucky Industries to complain about the Say When,
Kentucky personnel discovered that the units that were giving
trouble were Say Stops. When they examined the Maxi-Aids product,
they discovered that the Say Stops were not waterproof, and the
wires to the battery--a hearing aid battery--were very light-gage
and were corroding quickly. Byrd and company did not worry much
because, according to him, they decided that as soon as people
got used to the confusion in names and learned that the Say
When(R) was superior, the market would pick up again.
     But things did not get better; in fact, they got gradually
worse. They discovered that someone had begun producing a product
being called "Say When" as well. It was being imported from Asia,
so it cost significantly less than the Kentucky Say Whens(R). Not
until about a year ago did Bob Byrd learn that Maxi-Aids was
responsible for this infringement of its trademark. One by one
the various suppliers abandoned the Kentucky product for the
cheaper one. Marvin Sandler said he was the last to jump ship,
but he was being priced out of the market, so he eventually had
no choice but to find cheaper units to sell.
     When asked whether Kentucky had plans to sue Maxi-Aids for
infringement of trademark, Byrd said that he had discussed it
with the Attorney General's office and that the decision was not
to do so. The problem seems to be that the state would have to
employ an attorney specializing in trademark law in the state
where the suit would be brought, and it would simply be too
expensive. Byrd pointed out, however, that a transition is taking
place, and Kentucky Industries for the Blind is gradually
becoming Kentucky Industries for the Blind, Inc. The
transformation will be complete by June of 2000, and the
trademarks will belong to the new, private entity. At that point
the company will be free, if it chooses, to pursue those who
infringe on its trademarks in the future or even those who did so
in the past.
     Byrd commented wryly that he should have suspected that
Maxi-Aids was the culprit in the Say When(R) disaster. At about
the same time as the Say When problem was heating up, they
discovered that Maxi-Aids had begun advertising its own version
of another Kentucky trademarked product, which it called by the
Kentucky trademarked name--he thought it was Hi-Marks--and a
marketing person from Kentucky Industries for the Blind called
Maxi-Aids to protest the action and demand that they remove the
product from the Maxi-Aids catalog. Apparently without comment
Maxi-Aids complied with the demand. But that did not stop the
Zaretskys from pulling the same stunt with the Say When(R).
     Bob Byrd was to have testified at the Maxi-Aids trial until
serious illness in his family kept him at home. Bits of the story
came out during the trial, but without Byrd's testimony it was
somewhat unclear. Part of the difficulty, according to Sandler,
was Harold Zaretsky. Harold is deaf and used an interpreter,
which in itself compounded the problems of getting accurate
testimony. Sandler says that Harold has limitations but that he
is innately honest, though easily led by members of his family.
     During his deposition, Sandler says, Harold testified that
in the early nineties he was producing Say Whens in the Maxi-Aids
warehouse. Eventually production was moved overseas. By the time
Harold got onto the stand during the trial, he had a different
story to tell. He said that he had made one Say When to show to
the Asian manufacturers but that he had not produced them for
sale in quantity. Dweck got permission to read Harold's
conflicting testimony from the deposition into the court record,
but in the end he did not do so. It is clear from talking with
Sandler that he has no stomach for attacking Harold. In fact, one
of the things he holds against the other members of the Zaretsky
family is what they have done to Harold through all this.
                           **********
             The Department of Veterans Affairs Bids
                           **********
     One of the subjects of inquiry during the trial was Maxi-
Aids' efforts to strengthen its hand in the bidding process
conducted by the Department of Veterans Affairs. In 1993 the
Maxi-Aids bid on a number of items came in indicating that the
vendor was a woman-owned company, which gave it an advantage. The
next year it announced that it was minority-owned. The story was
that Pamela Stein had been the majority shareholder and was
running the business, even though Mitchel was the president.
Then, the story went, Pamela sold her interest to Harold, who
became the majority shareholder.
     Sandler called to the VA's attention the fact that in
neither instance was this the case with Maxi-Aids, but the VA
dismissed his claims because he was a competitor. Sandler's anger
over this ploy continued, apparently, to be a mystery to the
Zaretskys. During the trial Elliot pointed out that, even if
Maxi-Aids had been eliminated from the VA bidding, ILA would not
have gotten the bids in question, so he could not see what all
the fuss was about.
     Here are the facts that clearly emerged during the trial.
Apparently Pamela has never owned more than a third interest in
the company, and she has never run its day-to-day operations. She
was paid for her stock at the end of 1987, a full six years
before she was supposed to have sold her interest to Harold.
Harold has never held more than a third of the company's stock
and, of course, has never been a part of the company's
management.
     When Marvin Sandler was gathering documents for the trial,
he received a copy of a document from the VA dated May 25, 1993,
which stated that by April 30, 1994, Pamela Stein would sell her
interest in Maxi-Aids to Harold. VA officials said that Elliot
Zaretsky had turned over this document shortly after a VA
investigator came to interview him in the summer of 1994 about
whether or not his company had been woman-owned in '93 and was
minority-owned in '94. The Zaretskys maintained that this had
been an internal document only and that they had not given it to
the Department of Veterans Affairs. The fact remains, however,
that the plaintiff knew of the document's existence and knew to
demand that the defendant produce it because the Department of
Veterans Affairs had received it from somebody and, upon request,
had turned it over to Sandler.
     The allegations in this part of the case, if found to have
substance, may well lead to criminal charges. The VA has reopened
its investigation. It certainly did not do much of a job
investigating the first time around; only time will tell whether
more zeal will be shown in round two. Here is Mitchel Zaretsky's
testimony under direct examination by Jack Dweck:
                           **********
MR. DWECK: I call for the production of the original guaranty,
your Honor. This is a copy that counsel furnished us.
THE COURT: Do you have an original, Mr. Mulholland?
MR. MULHOLLAND: I have never seen an original, judge. I have to
inquire of Mr. Zaretsky.
THE COURT: You can inquire at the proper time. (Plaintiff's
Exhibit 110 received in evidence.)
Q: Mr. Zaretsky, when this guaranty was signed by you and your
brother Harold--you identified your signatures the other day; do
you remember that, sir?
A: Yes.
Q: And you submitted that guaranty to the Veterans
Administration, did you not, sir?
MR. MULHOLLAND: Objection.
THE COURT: Overruled.
A: I did not.
Q: Did someone from your company submit this guaranty to the
Veterans Administration?
MR. MULHOLLAND: Objection.
THE COURT: What ground?
MR. MULHOLLAND: Asked and answered. Judge, we covered that
ground.
THE COURT: I don't recall if we did. If it was, it will have to
be repetitive. Overruled.
A: I did not, no.
Q: Mr. Zaretsky, you signed this guaranty, did you not, sir?
A: It has my signature on it, yes.
Q: And you signed this guaranty for a governmental agency; is
that correct?
A: No.
Q: Who did you sign this guaranty for, Mr. Zaretsky?
A: I don't recall for whom, but it wasn't a governmental agency.
Q: Did you not submit this to Thomas Valerie of the investigative
unit of the Veterans Administration?
A: No.
Q: Isn't it a fact that this guaranty was delivered by your
father Elliot Zaretsky to special Investigative Agent Thomas
Valerie of the Veterans Administration?
A: I don't know what my father did.
Q: You are telling us that you as president and a one-third owner
signed the guaranty and you don't know what it was for; is that
what you are telling us?
A: Yes.
Q: Wasn't this guaranty in connection with a representation by
you to the Veterans Administration, sir, that your sister, Pamela
Stein was to relinquish her majority interest in Maxi-Aids by
April 30th, 1994?
A: No. I never met with a representative from the Veterans
Administration.
Q: You signed this statement, sir, which says that in order to
induce your sister Pamela Stein to relinquish her majority in
Maxi-Aids by April 30th, 1994, a certain sum was to be paid to
her; isn't that correct?
A: I don't recall what is on that statement.
Q: Let me read the first paragraph, sir. "On retirement of Elliot
Zaretsky on May 31, 1993, and in order to induce Pamela Stein to
relinquish her majority in Maxi-Aids by April 30th, 1994, the sum
of blank dollars will be paid to her, payee, and as of May 1,
1994, Harold Zaretsky will become the majority stockholder";
that's your statement, is it not, sir, in the first paragraph?
A: I am not familiar with this document.
Q: You are not familiar with it, but you signed it?
A: I sign tons of things.
Q: Did you read this document before you signed it, sir?
A: I don't recall.
Q: Do you normally sign a document entitled "guaranty" without
reading it?
A: I sign a lot of things without reading it.
Q: A guaranty, sir?
A: Even guaranties, yes.
Q: And who asked you to sign it?
A: I don't recall when it was signed.
Q: It is dated May 25, 1993. Do you see that, sir?
A: It has a date on it, yes.
Q: According to the documents we have in evidence, your sister
didn't even own one share of Maxi-Aids as of the date of this
guaranty; isn't that correct, sir?
A: I am not sure.
Q: Do we have to go through the K-1's again for '91, '92, '93,
'94 that we brought in evidence? [The K-1 is a tax form filed by
shareholders in small companies indicating the extent of their
holdings.]
A: On the K-1's, yes.
Q: Your sister didn't own one share?
A: The K-1's show that just Harold, Elliot, and myself own
shares, yes.
Q: Mr. Zaretsky, what was this document signed for if your sister
didn't even own one share as of May 25, 1993?
A: As I stated, I don't recall that document.
Q: Your attorney produced during the course of the discovery your
stock minutes and stock transfer ledger and your stock
certificate receipt book; is that right, sir?
A: Yes.
Q: Initially, when the stock was issued in the beginning of the
corporation, your sister had 50 shares, then it was changed to 33
and a third as of what looks like 5/15/86, correct?
A: Yes.
Q: And Harold as of the same date, who originally had 50 shares,
had his reduced to 33 and a third also; isn't that correct, sir?
A: Yes.
Q: And Mitchel, and that's you, who also had 50, had that changed
to 33 and a third as of the same date, 5/15/86; is that correct?
A: Yes.
Q: It looks to us from the stock book, which are the official
corporate records, your sister, Harold, and you each owned a
third as of 5/15/86, correct?
A: Way back in '86.
Q: Way back in '86?
A: Way back in '86.
Q: Okay. Then your father as of 1/1/88 got the 33 and a third
shares in the company, and presumably that was transferred by
Pamela Stein because that sheet says canceled, correct?
A: You can presume--
THE COURT: Is that in evidence?
MR. DWECK: I will offer it now.
THE COURT: Do not show it to the jury.
MR. DWECK: Sorry, your Honor. I would like to offer this in
evidence, your Honor.
THE COURT: Show it to counsel.
MR. MULHOLLAND: I have no objection to it.
THE COURT: I don't hear the number.
MR. DWECK: 111, your Honor.
THE COURT: Is that a stock transfer book?
MR. DWECK: These are, as the combined exhibits, it looks like the
corporate minutes with a copy of the certificate of incorporation
of Maxi-Aids, with a copy of the by-laws, with a specimen stock
certificate, with some shareholders' minutes meeting--
shareholder meeting minutes, and with the stock receipt from the
stock receipt book or from the stock book, which I was just
questioning Mr. Zaretsky about, and blank stock certificate
number five.
THE COURT: Plaintiff's Exhibit 111 in evidence.
(Plaintiff's Exhibit 111 received in evidence.)
Q: Mr. Zaretsky, the certificate on the receipt page as part of
this 111 exhibit shows that the 33 and a third shares of Pamela
Stein were canceled; is that right, sir?
A: It shows they were canceled, yes.
Q: And presumably it was canceled as of the date that your father
took over the 33 and a third shares, which is 1/1/88, correct?
A: I don't know when, so I can't assume.
Q: You see your father's share was issued on 1/1/88, correct?
A: Yes.
Q: That we see?
A: That we see.
Q: So we see the 33 and a third share to you and your brother
Harold; the receipt doesn't say canceled, does it, sir?
A: No, it doesn't.
Q: But the one to Pamela says canceled?
A: Yes.
Q: Then certificate number four was issued to your father as of
1/1/88; is that correct?
A: Originally it was 50 shares, crossed out to 33 and a third,
yes.
Q: Okay. Mr. Zaretsky, as of the time that your sister's stock
certificate was canceled, she didn't own a single share in Maxi-
Aids, correct?
A: Can you repeat that?
Q: I said, as of the time that that stock certificate was
canceled, that was issued to your sister, she did not even have a
single share of ownership in the corporation; isn't that right,
sir?
A: I honestly don't know.
Q: Well we know that as of '92, '93, '94, she didn't have a
single share; isn't that right, sir?
A: According to the K-1's, yes.
Q: So sometime between '88 and '92, presumably something took
place where your father took over the one-third interest that
Pamela had, agreed?
A: No.
MR. DWECK: Your Honor, I would call for production of the K-1's
for the years 1986 through 1991 inclusive on behalf of Maxi-Aids.
We have subpoenaed them, your Honor.
THE COURT: Do you have those records?
MR. MULHOLLAND: We don't have them here today, no, Judge.
THE COURT: Do you want to bring them here tomorrow?
MR. MULHOLLAND: Surely. If they exist, Judge.
THE COURT: If they exist. You are going to keep a record of all
these things, Mr. Dweck?
MR. DWECK: We are.
THE COURT: I am not.
MR. DWECK: That's why we have Mr. Hubell, Mr. Sandler, and Dr.
Berman [Marvin Sandler's wife].
Q: Mr. Zaretsky, isn't it a fact that your sister sold her shares
in the company, and the company paid her out?
A: She sold shares, and she was paid.
Q: Your sister received $833.33 on a monthly basis over a number
of years; isn't that right, sir?
A: I don't recall the exact number, but she received, yes.
Q: And that was the monthly basis that she was paid out; is that
correct?
A: She was paid. I am not sure of the timing, yes.
Q: Okay. I show you this document, Maxi-Aids check $833.33. The
first one is dated, it looks like 8/6/92. Do you see that check
number 14539, $833.33, correct?
A: Yes.
Q: And you signed that check?
A: Yes.
Q: And the next check 10/29/92, a check 14736, the same amount,
Pamela Stein, correct?
A: Yes.
Q: The first check was signed by you, and the next one signed by
your father, correct?
A: Yes.
Q: And then after that, I am sorry, it looks like March 12th or
March 6th, 1412 check number, the same amount, Pamela Stein,
correct?
A: It is cut off, but yes.
Q: In April of '92 the same amount, same person, check number
14215, to Pamela Stein?
A: Yes.
Q: August of '92, check number 14594 to Pamela Stein, same
amount, is that correct?
A: Yes.
Q: Signed by your father?
A: Yes.
Q: And then we have one in January '92, $833.33, correct?
A: Yes.
Q: And that check is marked stock sale?
A: Yes.
Q: Pamela Stein?
A: Yes.
Q: Does that refresh your recollection that your sister sold her
shares at least, and as of at least January of '92, she was being
paid out at the rate of $833.33 every month?
A: Yes, it says stock, yes.
MR. DWECK: Your Honor, these checks, on eight pages, and consist
of 23 checks, I would like to offer it as Plaintiff's Exhibit
112.
THE COURT: Show it to counsel.
(Whereupon, at this time there was a pause in the proceedings.)
THE COURT: Any objection?
MR. MULHOLLAND: No, Judge.
THE COURT: Plaintiff's Exhibit 112 in evidence.
MR. DWECK: Correct, Judge. (Plaintiff's Exhibit 112 received in
evidence.)
Q: Mr. Zaretsky, can we agree, sir, that some of these checks are
signed by you, and some signed by your father?
A: It appears, yes.
Q: And can we agree that the earliest of these checks as they
appear on these copies date back to 1992?
A: Some date back to '92, yes.
MR. DWECK: I am sorry, I was remiss, and I left two pages out
which I would respectfully request to be added to that exhibit. I
was mixed up.
THE COURT: Show it to counsel. (Counsel confer.)
THE COURT: Any objection?
MR. MULHOLLAND: No, Judge.
THE COURT: You will add the two pages to Plaintiff's Exhibit 112
in evidence.
MR. DWECK: Thank you, your Honor.
Q: With the admission of these two pages, Mr. Zaretsky, can we
agree, sir, that the first of the checks issued to your sister is
January 3rd, 1992?
A: You said that was June of '92 before.
Q: Well, we have one in April, and we have one in March; is that
correct?
A: March of '92, yes.
Q: Okay. Can we agree from March of '92, right into '94, where
some of those checks continue, your sister was paid out on the
sale of her stock in Maxi-Aids, yes?
A: She was paid out on stocks.
Q: Mr. Zaretsky, when you were questioned on a deposition on
September 10th, 1996, did you give these answers to these
questions, page 55, line 11--
MR. MULHOLLAND: Objection.
THE COURT: What ground?
MR. MULHOLLAND: Foundation. I don't know where we are going with
this, Judge.
THE COURT: I have to see a copy of the transcript.
MR. DWECK: Just the portion I highlighted, your Honor.
(Handed to the Court.)
THE COURT: Overruled. I will allow it.
MR. DWECK: Thank you, your Honor.
Q: Did you give these answers to these two questions, sir:
          Question: Mr. Zaretsky, did your sister Pamela ever
transfer her shares in Maxi-Aids?
          Answer: I don't recall.
Question: Did your sister Pamela ever sell her shares in Maxi-
Aids?
Answer: I do not know.
Did you give those answers to those questions, sir?
A: I believe I did.
Q: Mr. Zaretsky, when you signed this guaranty for whatever
purpose you signed it for, your sister had no ownership of shares
in Maxi-Aids as of May 25, 1993, correct?
MR. MULHOLLAND: Objection.
THE COURT: Sustained.
MR. MULHOLLAND: Thank you.
Q: Mr. Zaretsky, when you signed this guaranty which said: On the
retirement of Elliot Zaretsky as of May 31, 1993, and in order to
induce Pamela Stein to relinquish her majority in Maxi-Aids by
April 30th, 1994, the sum of blank dollars will be paid to her--
she never owned the majority, did she, sir?
MR. MULHOLLAND: Objection.
THE COURT: Overruled.
A: According to the K-1's, no.
Q: And according to the stock receipts in your own stock book,
she didn't either, did she, sir?
A: No.
Q: So this statement was false, wasn't it, sir?
A: I mean I don't recall that document.
Q: This statement was false, wasn't it, sir?
A: Again, I don't recall that document.
Q: Did you ever tell anybody that the statement that you signed
on this guaranty about your sister relinquishing her majority
interest was false, sir?
A: No.
                           **********
                     A Question of Character
                           **********
     Setting aside, if that is possible, the formidable body of
evidence of Maxi-Aids' shoddy business practice amassed during
this trial, there is an interesting and significant collection of
statements that shed light on the characters of the people
involved. For example, Milton Kaye, who worked at various times
for the American Foundation for the Blind, Vis-Aids, and ILA
developing and designing catalogs, offered two interesting
comments. He was a witness for the defense because he believed
that he had certainly had a strong impact on the content of the
ILA catalog and that he always brought much of the work he had
done previously when he came to a new company. In the following
interchange Jack Dweck is cross-examining Mr. Kaye:
                           **********
Q: Mr. Kaye, being the dean in the industry as Mr. Mulholland
described you before, you were successful in getting a
recognition for the ILA name in the two or three or four years
that you were there, weren't you, sir?
Q: Yes, that's true. Let me say this. My chief, my one aim was
not to make money for anybody. My one aim was always to get the
prices down on these aids and appliances for the blind. They were
being very badly treated, and I got a free hand from Ernie
Sandler [Marvin Sandler's brother, who was running ILA in the
early eighties], and I was able to do this. The name of ILA
became a blessing in the industry, and it was certainly
recognized as having done a great job for the blind and low
vision.
Q: Mr. Kaye, the success that you achieved was in getting the
prices down, correct?
A: That's right.
                           **********
     That shows pretty decisively what Mr. Kaye thought of ILA
when it came on the scene. Now here is his comment when
Mulholland tried to question him on redirect examination about
the numbering system used to identify the various products in
vendor catalogs. At the time under discussion in this excerpt,
Kaye was working for Vis-Aids at a point when Elliot Zaretsky was
a partner. Kaye had apparently said during his deposition that he
was responsible for the product numbering in the Vis-Aids catalog
while he was there. Here is the testimony:
                           **********
Q: Let me show you some numbers from some of the products in this
compilation that Mr. Dweck has put together, some of the product
numbers. Do you see the Lux long-ring timer, which is on page 2
of his compilation?
A: Yes.
Q: What is the product number there in the ILA catalog?
A: 450755.
Q: And that is the product number, sir, that you are not sure how
it was created, correct?
A: No, obviously not.
Q: At your deposition you testified that you had created those
numbers, but today you are saying you don't recall?
A: Right.
Q: Mr. Kaye, I'm handing you the 1985--I'm sorry, 1985 Vis-Aids
catalog, and I have it opened to page 10. This is from 1985, sir.
Is the Lux long-ring timer shown on that page?
A: Yes.
MR. MULHOLLAND: And so the jury can follow, sir, this is
Defendant's Exhibit AD in evidence.
Q: Mr. Kaye, in the Vis-Aids Lux long-ring timer ad, what is the
product number?
A: The first digits have been changed.
Q: Read the whole number.
A: Instead of 450755 in that catalog it is D50, D as in David
50755.
Q: Mr. Kaye, were you involved in the process of substituting a D
for the 4 for the first letter in the ILA numbers?
A: I'm going to retract my statement. I don't think I would be
that devious, I'm sorry. I don't think I was involved. I would
have changed it a little more radical. I would have made a little
more radical change rather than just one digit.
                           **********
     One of the more disillusioning themes running through this
trial was the repeated six-cent margin by which Maxi-Aids bested
ILA on seven watches in five different bids in recent years. The
jury was clearly impressed enough with this recurring alleged
coincidence to comment on it in its damage award of two million,
four hundred thousand dollars and six cents. In fact, after the
completion of the trial, Marvin Sandler reports that he met
members of the jury in the hall and thanked them for their
conscientious service. He says that the foreperson shook hands
with him and said, " I hope you liked the six cents. We tagged it
on to let them know that we know."
     Attorney Mulholland did his best to undercut the
significance of the repeated six-cent difference by calling
attention in his cross-examination of Marvin Sandler to a number
of bids through the years in which he, too, had beaten
competitors by very small amounts. Mr. Mulholland's efforts
crumbled into disaster for his clients in this exchange between
Jack Dweck and Marvin Sandler during redirect examination on the
subject:
                           **********
Q: Mr. Sandler, I direct your attention, sir, to Exhibit B.
A: I have it.
Q: Wasn't this the bid that Mr. Mulholland was questioning you
about being a penny or two pennies or five pennies cheaper than
another bidder?
A: Yes.
Q: Who was the other bidder, Mr. Sandler, on this solicitation?
A: Actually there were two of them. One is an organization known
as the American Printing House for the Blind. The second is an
organization called the Howe Press, which is a division of the
Perkins School for the Blind.
Q: And those are both organizations operated by or for the blind,
is that right, sir?
A: Yes.
Q: Nonprofit?
A: They are both not-for-profit organizations.
Q: And you are a profit-making organization; is that correct,
sir?
A: Well, there's a debate on that; we are a for-profit company.
Q: Mr. Sandler, you were bidding against two not-for-profit
organizations on the sale for product?
A: Yes.
Q: I direct your attention, Mr. Sandler, to the second page of
that Exhibit B.
A: Yes.
Q: Do you see on the bottom third of the page, the category is
books, recorders, accessories?
A: Yes.
Q: ILA bid on the first item $14.94.
A: Yes.
Q: And the American Printing House for the Blind bid a penny more
than you, $14.95.
A: That's correct.
Q: Is there an explanation as to how you were a penny cheaper?
A: Yes, there is.
Q: Would you share it with us?
A: The American Printing House for the Blind and let me to save
time say that the Perkins School for the Blind also published a
price list, each of them are one-price houses. If you buy one
unit, ten units, or 10,000 units you pay the same price. No
matter who bid or buys that book, or in this case the abacus,
their price is $14.95. I bid $14.94 and lost a penny on every
single one.
Q: How did you lose a penny, sir?
A: Because I paid them the full price of $14.95, and I sold them
to the State of Texas for $14.94.
Q: Let me understand something, Mr. Sandler. You bought this
product, the abacus from American Printing House for the Blind,
at $14.95, and you listed it and bid $14.94?
A: That's correct.
Q: You are in business to make money?
A: Also in business to do what I feel is the right thing.
Q: How do you explain, sir, bidding a penny cheaper on that
product?
A: It requires a bit of an explanation. I've testified to the
fact that I do volunteer work at the Helen Keller National
Center. This is a center that is located in Sands Point, and it
is used as a training center for people who are deaf and blind
both. I do volunteer work there. I also employ deaf-blind people
in a work-experience program, I have a relationship with them, I
know them. When somebody goes to the Helen Keller National
Center, their transportation is paid for. They stay there
anywhere from six months to three years doing their training
while they train to be independent. At the end of their six
months to three-year period, their transportation is paid back
home, and hopefully the job situations are established for them.
During that period, if they want to go home for the holidays, if
they want to see a relative, if they have any reason at all to go
home, it is not paid for; they have to do it themselves.
     I saw that, and in 1987 or '89, I forget, I wrote to
American Airlines. I am an American Airlines Advantage card
holder. The Advantage program is a program under which, when you
fly, you get mileage credit which can be saved up for free
tickets. Many credit card companies also allow you to charge a
credit card and get miles on a specific airline, and I happen to
use the American Airlines Advantage. So I wrote to American
Airlines, and I said you've got people here who are deaf and
blind. You have other people who are accumulating miles. Wouldn't
it be a nice thing and wouldn't it also be good publicity for
American Airlines if we were to allow people to contribute their
miles to give free tickets to deaf-blind people to go home, and I
just think it would be a nice thing. American Airlines turned me
down.
     I tried again two years later, and I got turned down again,
and then I decided to do something about it myself. Now I can
give you a more dramatic example. A Perkins Brailler, which is
made by the Howe Press, Perkins division, currently sells for
$640. I bid $639.95. I lose a nickel on every one. Forty of them
are worth about $25,000. On $25,000 worth of merchandise, I lose
40 nickels, that's $2, but that gives me 25,000 miles, and I take
those 25,000 miles and, when somebody from Helen Keller needs to
fly home, I give them a free ticket. And I feel that is a win,
win, win, win--four wins--situation. The American Printing House
for the Blind or the Perkins School for the Blind gets their
money in full, and they get it immediately. Texas, or whoever I
bid to, gets the item a little bit cheaper, a few pennies, but
nonetheless cheaper than they otherwise would have to pay. Number
three, a deaf-blind person can go home. Number four, I feel good.
     Now I have letters of appreciation from Helen Keller. I have
some of them written by deaf-blind people, some written by their
counselors, some written by the head of Helen Keller thanking me
for my contribution for the tickets, and that's why I bid a few
pennies lower, and throughout all of these bids you will find I'm
anywhere from a penny to a nickel cheaper than the American
Printing House for the Blind or the Perkins School for the Blind.
Q: Mr. Sandler, how many items did you underbid either Howe or
American Printing House for the Blind on that bid alone?
A: I'll have to count. Twenty for the American Printing House for
the Blind, and six for the Howe Press division of the Perkins
School for the Blind.
Q: Mr. Sandler, roughly how many miles did you generate from your
credit card purchases from APH and from the Howe School, that you
used for contributions to provide people's transportation?
A: I've been averaging about 200,000 miles per year.
Q: How many tickets does that amount to?
A: Eight.
Q: And there's no strings, no fees?
A: To a blind person, no.
                           **********
     Contrast the impression that story gives of Marvin Sandler
with the impact of Bill Ankenbrant's testimony of his telephone
conversations with Elliot Zaretsky. Ankenbrant owns and operates
New Vision, a small retail outlet carrying products for blind and
visually impaired people in Philadelphia. It used to be owned by
Associated Services for the Blind and was called Sensations. Jack
Dweck's assistant counsel Richard Hubell is questioning Mr.
Ankenbrant.
                           **********
Q: Did you ever receive a call from someone from Maxi-Aids
concerning Independent Living Aids?
A: Yes.
Q: And who called you?
A: Mr. Elliot Zaretsky.
Q: And when did he call you?
A: I am not great with dates. It was a November, prior to an
article in the Braille Monitor regarding Maxi-Aids, either the
same November or the November prior to it.
Q: And did Mr. Zaretsky identify himself during that telephone
conversation?
A: Yes.
Q: What did he say to you, and you say to him during that
telephone conversation?...[discussion between the judge and the
attorneys resulting in Mr. Hubell's being allowed to continue
with his line of questioning]
A: Well, basically, Mr. Zaretsky said to me that he wanted to let
me know that the NFB was very upset with ILA and another company
and that he was giving me the feeling that, it was sort of
advice, that I should be very careful, being that New Vision is a
small store, and Sensations was a small store, and when I worked
for Sensations, I was pretty low on the totem pole, if I would
deal with ILA, AFB would be mad at me. [obviously a slip of the
tongue]
Q: AFB would be mad at you is what you said?
A: Yes.
Q: Did anyone else say anything else during that telephone
conversation that you can recall?
A: I am not sure. That's the brunt of it.
THE COURT: What is AFB?
A: National Federation of the Blind, they are a famous group, a
watchdog for rights of the blind. For instance, if a restaurant
doesn't admit a blind person with a guide dog, they will make
sure that the restaurant is aware of the blind person's rights to
use a guide dog in any facility.
Q: Subsequent to the telephone conversation that you had with Mr.
Zaretsky, did you find out whether or not what he told you during
that conversation was true?
MR. MULHOLLAND: Objection.
THE COURT: I don't understand that question.
MR. HUBELL: I will rephrase it, Judge.
Q: What did you do after the telephone conversation with Elliot
Zaretsky?
A: What did I do with Elliot or what--
Q: What did you do after the conversation?
A: Well, I was a bunch younger then and insecure because, you
know, I was working for a company, and being they are a social
services company I never felt they completely--that I completely
understood retail. I was very nervous. So I spoke to the man who
started the store for the Associated Services for the Blind.
THE COURT: Never mind what he told you, sustained.
MR. MULHOLLAND: I move to strike about being nervous and young,
et cetera.
THE COURT: I will let that stand. Your motion is denied.
Q: Did you ever find out whether or not NFB was upset with ILA?
MR. MULHOLLAND: Objection.
THE COURT: Sustained. When you see--I am sorry. When you hear the
objection, don't answer.
THE WITNESS: Okay.
THE COURT: All right.
Q: Did you ever read the article that was published in the NFB?
A: Yes.
THE COURT: What article are you referring to, the article that
has been the subject of a lot of discussion?
MR. HUBELL: That's correct.
MR. MULHOLLAND: Objection.
THE COURT: Did he read it?
MR. HUBELL: That's correct.
THE COURT: Sustained.
Q: Did you ever listen to the article?
MR. MULHOLLAND: Objection.
THE COURT: How is that relevant?
MR. HUBELL: It goes to the conversation, Judge, that Mr. Zaretsky
had with Mr. Ankenbrant.
THE COURT: No, it doesn't. Sustained. Nothing to do with the
conversation.
Q: Did you continue to do business with ILA?
A: Yes, I did.
Q: And why?
A: Well, I was given a copy of the Braille Monitor.
MR. MULHOLLAND: Objection. Move to strike any testimony
concerning the Braille Monitor article. It is not in evidence
yet.
THE COURT: Sustained.
Q: Prior to coming to court today, have you spoken to Elliot
Zaretsky?
A: Yes.
Q: When was the last time you spoke to Elliot Zaretsky?
A: Not very long ago.
Q: Can you recall the date?
A: I am sorry, I am not great with dates.
THE COURT: Was it a year ago, two years ago, a day ago, a month
ago?
THE WITNESS: Less than a month ago, I guess--within two weeks,
maybe three.
THE COURT: You are not too bad, after all; I mean at judging
dates.
THE WITNESS: Thank you.
Q: Did you call Mr. Zaretsky?
A: No.
Q: Did he call you?
A: The last time. But it was in a group of three, four phone
calls. The last time I called him.
Q: Can you describe the last conversation you had?
A: Yes.
Q: Who called?
A: I answered the phone, New Vision. And Mr. Zaretsky identified
me, and then he identified himself. And he seemed very upset with
me. And his words were, I understand you are going to be in New
York. What did we ever do to you? What did I ever say to you? I
basically said that I didn't feel comfortable talking about it.
Q: Did he say anything else during that telephone conversation?
A: He said we have always treated you--he either used the word
"good" or "nice." I told him again I really didn't feel
comfortable talking about it.
Q: Did you terminate the conversation?
A: Unfortunately, yes.
Q: How did you terminate the conversation?
A: I told him I really don't feel comfortable. I am going to go
now. It is not my standard practice.
Q: What do you mean, it is not your standard practice?
A: I don't believe in cutting people off.
Q: Why did you cut Mr. Zaretsky off then?
A: I didn't feel comfortable. He seemed angry.
MR. HUBELL: Thank you, Mr. Ankenbrant.
                           **********
     Then there was Pamela Zaretsky Stein, who takes the prize
for unresponsiveness and arrogance, considering the relative
brevity of her testimony. She was determined to admit as little
as possible and make Jack Dweck work as hard as possible for what
he got. This is the way it went:
                           **********
Q: Did you file income tax returns with the federal government
for each of the years from 1990 through 1996 for the salary that
you received from Maxi-Aids for the work you did there?
A: Yes.
Q: Mrs. Stein, did you own stock in Maxi-Aids in 1996?
A: I don't recollect that.
Q: Was that a yes or a no?
A: I can't answer yes or no.
Q: How about for 1995, were you an owner of stock in Maxi-Aids?
A: That's not a yes or no answer.
Q: Well, how about for 1994, either you owned stock or you
didn't. Can you answer that with a yes or no?
A: No, I can't. It's not a yes or no answer. I really don't know.
I can't answer that.
Q: In 1993, Mrs. Stein, did you own stock in Maxi-Aids?
A: I don't know.
Q: How about in 1992?
A: I don't know.
Q: If I were to ask you the same questions for 1991 right back to
1986, what would your answer be?
A: The same answer.
Q: You don't know?
A: That's right.
Q: Mrs. Stein, were you ever issued a stock certificate for any
shares in Maxi-Aids?
A: Not that I can recall.
Q: You know what a stock certificate is, do you not?
A: Somewhat.
Q: Did you ever get a piece of paper that said you owned so many
shares in Maxi-Aids?
A: Not to my knowledge.
Q: Is that a no?
A: I said not to my knowledge.
Q: Well, Mrs. Stein, were you ever a stockholder in Maxi-Aids at
any time from 1986 right up until now?
A: You would have to ask my father that. I did not handle that.
MR. DWECK: Move to strike, Your Honor.
THE COURT: Yes. Motion granted. Strike the answer as not being
responsive. The jury is instructed to disregard it.
Q: Mrs. Stein--
A: Yes.
Q: Did you or did you not ever own any stock in Maxi-Aids from
1986 right up until now?
A: I can't answer that yes or no. I don't know.
Q: Well, Mrs. Stein, have you ever received checks for the sale
of stock that you owned in Maxi-Aids?
A: Not to my knowledge.
Q: Mrs. Stein, I'm going to show you these documents which have
been marked in evidence as Plaintiff's Exhibit 12. These are
checks made out to you, are they not?
A: That's correct, yes.
Q: Did you receive these checks?
A: Yes, I did.
THE COURT: You say this is?
MR. DWECK: 112.
THE COURT: Okay.
BY MR. DWECK:
Q: Do you know what these checks were for, Mrs. Stein?
A: My belief was that they were salary checks.
Q: Mrs. Stein, I show you this check from this same Exhibit 112,
and the check number is 14023. That's made out to you, isn't it?
A: Yes, it is.
Q: Do you see it says stock sale?
A: Yes, I see it. Yes.
Q: Were these checks for the sale of your stock?
A: To my knowledge, it was for the work that I've done. I was not
told otherwise.
Q: Did you ever sell stock in Maxi-Aids for which you received
these checks?
A: That was for salary.
Q: So whoever wrote "stock sale" on the check, according to what
your testimony is, made a mistake?
A: You have to ask them. I can only tell you what I know.
Q: Well, when you saw this check, you got the money from this
check, did you not?
A: Yes, that's correct.
Q: And you deposited the money into your account?
A: Yes.
Q: Did you tell anyone that the word "stock sale" was wrong?
A: I never noticed that. I cashed that check for the work that
I've done.
Q: So according to what you're telling us then, you never got
paid for any stock in the company; is that right?
A: My understanding is those checks were for services rendered.
Q: Did you ever get paid for the sale of your stock in Maxi-Aids?
A: Not to my knowledge.
Q: Did you ever have any stock in Maxi-Aids?
A: I really believe I did, but we were very informal.
MR. DWECK: Move to strike, Your Honor.
THE COURT: After the words "I really believe I did," strike out
the rest of the answer. The jury is instructed to disregard it.
Q: Ms. Stein, do you own stock in Maxi-Aids as of today?
A: I honestly don't know.
Q: Well, did you ever stop being a stockholder in Maxi-Aids?
A: I don't know.
Q: Ms. Stein, do you remember in the course of the discovery in
this case that you were examined before trial?
A: Excuse me? Repeat that, please?
Q: Do you remember that you were asked questions and answers in
this case back on August 5, 1996?
A: What are we referring to?
Q: Do you know what a deposition is, Mrs. Stein?
A: Yes, but you did not say that.
Q: Well, do you remember attending a deposition?
A: Yes, I do.
Q: Do you remember Mr. Hubell from my office asked you questions
during this deposition?
A: Yes, of course I do.
Q: And there was a stenographer present taking this down in
shorthand; is that correct?
A: Yes, it is.
Q: At the time of your deposition you were under oath, do you
remember that?
A: Yes.
Q: And you swore to tell the truth?
A: What I believe, yes.
Q: Mrs. Stein, did you give this answer to this question? Page
66, line 25.
          "Question: Did a time come you ceased being a
shareholder of Maxi-Aids?
          "Answer: Not to my knowledge, sir."
Did you give that answer to that question?
A: At that time, at that date, if that's what is stated, then I
did.
Q: Mrs. Stein, were you or were you not ever a shareholder in
Maxi-Aids?
A: I believe I was a shareholder.
Q: And, as of August 5, 1996, your testimony was you still
continued as a shareholder; isn't that right?
A: My understanding, yes. I really don't know. I can't answer
that yes or no. That would be my answer.
Q: Mrs. Stein, are you a shareholder today?
A: I don't know.
Q: Have you sold your shares from the day of this deposition,
August 5, 1996, until today?
A: I don't know.
Q: Mrs. Stein, did you ever receive any W-2 forms for the work
you did at Maxi-Aids from 1986 right through until 1996?
A: I'm sure I did, but I don't recall every year. I don't know
what you're trying to get at, you are talking about--say that
again, please.
Q: Mrs. Stein, you know what a W-2 is?
A: Yes, I know.
Q: You are the bookkeeper for Maxi-Aids?
A: I am not.
Q: Did you ever handle the books?
A: Yes.
Q: Did you handle the payroll?
A: Payroll is not the same as bookkeeping.
Q: So you did handle the payroll?
A: Only the last two years.
Q: You know what a W-2 is?
A: I never said I didn't.
Q: Did you ever get paid from Maxi-Aids?
A: Yes.
Q: Every year?
A: Depends on the year. If I worked and I did not get paid, I
don't get a W-2.
Q: But you worked for Maxi-Aids every year, didn't you?
A: I also worked for free.
MR. DWECK: Move to strike, Your Honor.
THE COURT: Yes. Motion granted. Strike out the entire answer as
not being responsive. The jury is instructed to disregard it.
BY MR. DWECK:
Q: Mrs. Stein, you say these checks, Plaintiff's 112, were salary
checks; is that right?
A: That's my understanding, yes.
Q: Were there any deductions taken from your salary that
reflected itself in these checks?
A: You'd have to ask the person who made the checks. I don't have
any idea.
Q: You mean to know if anybody took out withholding from your
salary?
A: No, I don't. You'd have to ask the person.
Q: Mrs. Stein, do you know if FICA taxes were taken out?
A: I understand that, but it could have been built into the check
too. I don't know.
Q: Do you know if Social Security was taken out from your salary?
A: As I say again, I don't know.
Q: Do you know if state withholdings were taken out of your
salary check?
A: And I'll tell you again. I don't know. I did not write the
check.
MR. DWECK: Move to strike, Your Honor.
THE COURT: After the words "I don't know," the rest of the answer
is stricken.
BY MR. DWECK:
Q: Mrs. Stein, when did you become a shareholder in Maxi-Aids?
A: I believe in the very beginning, when it was started, but I
don't really recall.
Q: Well, did you own shares in Maxi-Aids in 1991?
A: I don't know.
Q: How about in 1992?
A: I don't know.
Q: How about in '93?
A: I don't know.
Q: And would your answer be the same for '94, '95, and '96?
A: That's correct.
Q: How about for 1989 and 1990, Mrs. Stein?
A: The same.
Q: You don't know?
A: Right.
Q: How about the '88 area or '87?
A: I'll say again, the same.
Q: '86?
A: I believe that I was, but I really don't know.
Q: Mrs. Stein, was your brother Harold ever a shareholder of
Maxi-Aids?
A: I can only answer for myself.
MR. DWECK: Move to strike, Your Honor.
THE COURT: Motion granted. Strike the answer as not responsive.
BY MR. DWECK:
Q: Mrs. Stein, was your brother Harold ever a shareholder of
Maxi-Aids?
A: I believe he was.
Q: When did he acquire any stock?
A: I don't know.
Q: Well, was he a shareholder in 1986?
A: I don't know.
Q: What about '87?
A: I don't know.
Q: And how about if I asked you for every year from '88 right up
to '96, what would your answer be?
A: I don't know. You would have to ask him.
Q: Mrs. Stein, you worked on the catalog for Maxi-Aids, did you
not?
A: What year are we talking about?
Q: In any of the years you say you worked for Maxi-Aids.
A: You have to tell me the year.
Q: How about 1986?
A: Absolutely not.
Q: How about '87?
A: Absolutely not.
Q: '88?
A: Absolutely not.
Q: When was the first year you say you worked on the Maxi-Aids
catalog?
A: Somewhere in 1995.
Q: And before that, did you ever work on any of the Maxi-Aids
catalogs before '95?
A: Only for part of mine, but I did not get involved in the
catalog, actual catalog.
Q: And you worked on the '95 catalog; is that right?
A: I didn't put it together. I got product line.
Q: Okay.
Mrs. Stein, when you worked on the catalog for Maxi-Aids, did you
look at any of the competitors' catalogs?
A: Absolutely not.
Q: Well, would you agree with me, Mrs. Stein, that ILA is a
competitor of Maxi-Aids?
A: Absolutely not.
Q: They are not a competitor?
A: To me, no.
Q: Does Maxi-Aids have any competitors?
A: We stand alone.
                           **********
     "We stand alone." One certainly hopes that no other firm in
the blindness field can compete with Maxi-Aids in all the various
cut corners, shortcuts, tricks, double-dealings, and immoral
practices laid out in the testimony of this trial. The Zaretskys
did their best to suggest that Marvin Sandler single-handedly
tried to destroy their livelihood and their good name in the
blindness field. They claimed that they had lost money, but Jack
Dweck produced evidence that their profits had doubled in the
year following the Braille Monitor story. In the end the jury
spoke clearly in rendering its verdict. Here is that verdict as
read by the foreperson count by count in response to inquiries by
the clerk:
                           **********
THE CLERK: I will review the verdict with you and ask for your
responses. As to the federal copyright infringement claim,
question 1. Did the plaintiff Independent Living Aids prove that
it changed the product listing from its non-copyrighted catalogs,
so that the listing as changed in the copyrighted catalogs were
removed from the public domain and were original and protected?
THE FOREPERSON: Yes.
                           **********
THE CLERK: Question two.
     Did the plaintiff ILA prove that it is the owner of a valid
registered copyright to the Independent Living Aids, Inc.
catalogs to the years 1985 to 1995?
THE FOREPERSON: Yes.
                           **********
THE CLERK: Question three.
     Did the plaintiff ILA prove that the defendant Maxi-Aids,
Inc. infringed the plaintiff's copyrights in its 1985 through
1995 catalogs by copying original product listings in any of the
plaintiff's copyrighted catalogs?
THE FOREPERSON: Yes.
                           **********
THE CLERK: Question four. Did the plaintiff ILA prove that the
defendant Maxi-Aids acted willfully when it infringed the
plaintiff's copyrights?
THE FOREPERSON: Yes.
                           **********
THE CLERK: As to the federal trademark and service mark
infringement claim. Question five. Did the plaintiff ILA prove
that the term "Can-Do Products" is a suggestive term and does not
require proof of secondary meaning?
THE FOREPERSON: Yes.
                           **********
THE CLERK: Question six.
     Did the plaintiff ILA prove that prior to any copying of the
terms the plaintiff had so used each of the following terms so
that it developed a secondary meaning, so as to associate that
term with the plaintiff, Independent Living Aids?
THE FOREPERSON: Yes.
THE COURT: There is no answer to Can-Do Products, correct?
THE FOREPERSON: Yes, correct.
                           **********
THE CLERK: Question seven. Did the plaintiff ILA prove that the
defendant Maxi-Aids in its advertising, catalog, and sales
program used the following terms "Independent Living" "ILA" the
ILA logo "Do More Products," "Maxi-Aids," and "Appliances for
Independent Living" and "Maxi-Aids products for Independent
Living" in a manner likely to cause confusion as to the source
among persons using ordinary care in the purchase of the products
sold by both companies? Independent Living.
THE FOREPERSON: No.
THE CLERK: ILA.
THE FOREPERSON: No.
THE CLERK: ILA logo.
THE FOREPERSON: Yes.
THE CLERK: Do More Products.
THE FOREPERSON: No.
THE CLERK: Maxi-Aids and Appliances for Independent Living.
THE FOREPERSON: No.
THE CLERK: Maxi-Aids Products for Independent Living.
THE FOREPERSON: No.
                           **********
THE CLERK: As to the federal trade dress infringement claim as to
the watches. Question eight. Did the plaintiff ILA prove that the
trade dress of its Slimline Lo-Vision watches were distinctive or
had acquired secondary meaning?
THE FOREPERSON: Yes.
                           **********
THE CLERK: Question nine. Did the plaintiff ILA prove that the
defendant Maxi-Aids in its catalog and sales program advertised
and sold its Ultima Low-Vision Watches in a manner likely to
cause confusion as to the source among persons using ordinary
care in the purchase of the watches?
THE FOREPERSON: Yes.
                           **********
THE CLERK: Question 10. Did the defendant Maxi-Aids prove that
the features of the plaintiff's Slimline Lo-Vision watches it
allegedly copied and advertised are functioning, meaning that
such features are essential to the basic purpose of such watches?
THE FOREPERSON: Yes.
                           **********
THE CLERK: Question 11. Did the plaintiff ILA prove that the
following individual defendant was an actual participant in the
infringement of the defendant Maxi-Aids or that the following
individual defendant authorized or approved the acts of
infringement or was a conscious moving force behind the
infringements?
Harold Zaretsky.
THE FOREPERSON: No.
THE CLERK: Mitchel Zaretsky.
THE FOREPERSON: Yes.
THE CLERK: Elliot Zaretsky.
THE FOREPERSON: Yes.
THE CLERK: Pamela Zaretsky Stein.
THE FOREPERSON: Yes.
                           **********
THE CLERK: As to the New York Deceptive Acts and Practices Claim.
Question 12. Did the plaintiff prove that the defendant Maxi-Aids
engaged in a materially deceptive act and practice with regard to
the advertising and sales of its products?
THE FOREPERSON: Yes.
                           **********
THE CLERK: Question 13. Did the plaintiff prove that the primary
injury resulting from the said deceptive act and practice was
suffered by the public?
THE FOREPERSON: Yes.
                           **********
THE CLERK: Question 14. Did the plaintiff ILA prove that it was
injured by the said deceptive act and practice?
                           **********
THE FOREPERSON: Yes.
                           **********
THE CLERK: Question 15. Did the plaintiff ILA prove that the
defendant Maxi-Aids acted willfully when it committed the
deceptive act and practice?
THE FOREPERSON: Yes.
                           **********
THE CLERK: As to the New York false advertising claim. Question
16. Did the plaintiff ILA prove that the defendant Maxi-Aids
engaged in false advertising that was misleading in a material
aspect with regard to the sale of their products?
THE FOREPERSON: Yes.
                           **********

THE CLERK: Question 17. Did the plaintiff ILA prove that it was
injured as a result of such false material misleading
advertisement?
THE FOREPERSON: Yes.
                           **********
THE CLERK: Question 18. Did the plaintiff ILA prove that the
defendant Maxi-Aids acted willfully when it committed the false
advertising?
THE FOREPERSON: Yes.
                           **********
THE CLERK: As to the New York State intentional interference with
economic benefits claim. Question 19. Did the plaintiff ILA prove
that the defendant Maxi-Aids knew that the plaintiff had made
certain bids to the Veterans Administration in 1993 and 1994?
THE FOREPERSON: Yes.
                           **********
THE CLERK: Question 20. Did the plaintiff ILA prove that the
defendant Maxi-Aids intentionally interfered with the plaintiff's
bids?
THE FOREPERSON: Yes.
                           **********
THE CLERK: Question 21. Did the plaintiff ILA prove that it would
have been a successful bidder if not for the interference of the
defendant Maxi-Aids.
THE FOREPERSON: No.
THE COURT: You didn't answer 22, correct?
THE FOREPERSON: Correct.
THE COURT: Let's go to 23.
                           **********
THE CLERK: Question 23. Did the plaintiff ILA prove that the
following individual defendant was an actual participant in the
wrongful acts comprising the New York State claims or that the
individual defendant authorized or approved of the wrongful acts
or was a conscious moving force behind the wrongful acts?
Harold Zaretsky.
THE FOREPERSON: No.
THE CLERK: Mitchel Zaretsky.
THE FOREPERSON: Yes.
THE CLERK: Elliot Zaretsky.
THE FOREPERSON: Yes.
THE CLERK: Pamela Zaretsky Stein.
THE FOREPERSON: No.
                           **********
THE CLERK: As to the libel counterclaim of the defendants Maxi-
Aids, Harold Zaretsky, Mitchel Zaretsky, and Elliot Zaretsky
against plaintiff Marvin Sandler. Question 24. Did the defendant
Maxi-Aids prove that the statements by Marvin Sandler in his
letter dated January 17, 1994, sent to Dr. Jernigan, and
published in the December, 1994, edition of the Braille Monitor
were defamatory?
THE FOREPERSON: No.
THE COURT: Did you answer questions 25, 26, and 27?
THE FOREPERSON: No, Judge.
THE COURT: All right. Let's proceed to the damages question.
                           **********
THE CLERK: Damages in the plaintiff's claims. Compensatory
damages. Question 28. What amount of damages, if any, do you
award to the plaintiff ILA for loss of business and profits as a
result of any of the wrongful acts in the three federal and three
New York State claims?
THE FOREPERSON: $2,400,000.06.
                           **********
THE CLERK: As to punitive damages, question 29. In the
intentional interference with economic benefits claim, do you
award punitive damages in favor of the plaintiff ILA against the
defendant Maxi-Aids?
THE FOREPERSON: No.
THE COURT: Do you answer any of the other questions?
THE FOREPERSON: No, Judge.
                           **********
     There you have the highlights of a trial that will probably
remain a unique legal episode in the blindness field. The
Zaretskys have submitted motions to Judge Spatt, and Marvin
Sandler's attorney has responded. Each side gets another chance
to respond to what its opponent has argued. Then the judge will
decide whether or not to accept any of the Zaretskys' motions. If
he does not, the Zaretskys will have to decide if they want to
try an appeal. Since Mitchel Zaretsky would not speak to the
Braille Monitor, we could not confirm Marvin Sandler's
understanding that Mark Mulholland will not be serving as counsel
to the Zaretskys during any possible appeals. Mulholland himself
sidestepped the question by saying that the appeal process was
still a long way in the future and that he is certainly the
attorney of record at present.
     Marvin Sandler makes no bones about the fact that he
undertook this legal action because he thought it was in his own
financial interest to do so. But in the next breath he adds that
somebody had to let the world know what the Zaretskys think of
their competitors and customers and how they are prepared to
treat them. From now on no one in the blindness field can claim
that they didn't know about Maxi-Aids and the way the Zaretskys
do business--let the buyer beware.
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