Officers and employees of a North Carolina company pleaded not guilty Thursday to 11 counts of mailing obscene materials to customers in Utah.
In a brief court appearance before U.S. Magistrate Ronald N. Boyce in Salt Lake City, the six individuals were informed that they each face maximum penalties of 55 years in prison and $2.75 million in fines.The company they operate, P.H.E. Inc., which also does business under the name Adam & Eve Inc., was also named in the indictment. If found guilty, the company could be assessed $5.5 million in fines.
Entering pleas of not guilty were company president Philip D. Harvey and employees Alan C. Bushnell, Ann F. Buzenberg, Frederic W. Fuller Jr., Richard W. Loy and Peggy A. Horton.
A federal grand jury in Utah indicted them Sept. 19 on charges that they mailed sexually oriented catalogs, videotapes and magazines to customers in the state, including an 8-year-old boy. The alleged incidents occurred in 1986.
Through a press release issued by a Washington, D.C., public relations firm, Harvey said the indictments are a "vindictive response" to a lawsuit Adam & Eve filed earlier this year against the Department of Justice. The company's civil suit says it has been targeted for harassment by the government.
"By indicting us for activities that date back 41/2 years, (the Justice Department) is taking desperate steps to block us from collecting depositions for the case," Harvey said. "These depositions reveal extraordinary wrongdoing by the Justice Department and prove its intention to suppress constitutionally protected speech."
The case has attracted national attention because of P.H.E.'s high-profile activities. Founded in 1970, the company began as the nation's first contraceptive mail-order business. It later entered the adult-oriented products market, distributing "books, birth control devices, sensual accoutrements and videotapes."
Noting that the company stopped distributing sexually oriented materials in Utah four years ago and that three of the defendants are no longer connected with the firm, Harvey said, "These indictments cannot possibly serve any legitimate public purpose."
U.S. Attorney Dee Benson said last month that several factors contributed to the delay in the indictments.
"After the mailings occurred back in 1986, there was some discussion between the company and the prosecutors here. Those dragged on for some time. We'll have such discussions with anybody under investigation who wants an audience," Benson said.
And he added that the company's civil suit sought to block criminal prosecution by alleging bad faith on the part of the Department of Justice. The indictment was put on hold pending resolution of that issue, Benson explained.
During the course of the grand jury investigation, prosecutors sought a subpoena to obtain a list of all of the firm's contraceptive customers in the United States, but later dropped the request.
According to the firm's spokesman, Adam & Eve employs about 100 people and fills nearly 15,000 orders per week.