Pennsylvania Attorney General Fisher Releases $1.7 Million to PA Consumers Following Lawsuit Against Publishers Clearing House.
"The restitution we obtained in this case will go to consumers who incurred the largest monetary losses," Fisher said. "It was clear to us, that these `high activity' consumers purchased large quantities of goods from Publishers Clearing House after they were horribly misled about their chances of winning a big cash prize," Fisher said. "I'm pleased to announce that our settlement holds the company responsible for its actions and permanently halts the use of fraudulent language or gimmicks to sell products in the future."
Fisher identified "high activity" consumers as those who purchased $1,000 or more in goods from Publishers Clearing House (PCH) in a single year between 1997 and 2000.
The $1.7 million in restitution for Pennsylvanians was part of a $34 million settlement with PCH to resolve a multi-state lawsuit that was filed against the company by Fisher and 25 other Attorneys General. The January 2000 lawsuit accused the New York-based national marketing company of violating the states' Consumer Protection or Public Protection Laws.
According to the suit, PCH mailed sweepstakes to consumers that used deceptive language including "Guaranteed Cash Winner" or "Certified Cash Winner" leading consumers to believe that they won a cash prize. The sweepstakes also inferred that consumers who purchased goods would have their name forwarded to the "Prize Patrol." The suit claimed that consumers made hundreds even thousands of dollars worth of purchases because they were convinced that their chances of winning would be enhanced.
Under the terms of the June 2001 settlement, PCH is barred from using false, deceptive or misleading statements that imply a person has won or is about to win a prize. The sweepstakes giant is also prohibited from inferring that making a purchase enhances the chances of winning. Also barred from its promotions is the use of gimmicks such as attorney letters, tax advice notices or other documents that indicate the consumer has been selected as a winner.
As a result of our legal action, Fisher said, consumers will be informed that no purchase is necessary to win and that buying a product does not enhance your chances of winning. In addition, all mailings must include a "Prize Data Grid" explaining the prizes awarded, the value of each prize and consumers' odds of winning a prize. The settlement also requires PCH to identify "high activity" customers and cease all solicitations and communications unless third-party approval is obtained.
"This provision will prevent consumers from continuously receiving sweepstakes if their purchasing activity is excessive," Fisher said. "We know from complaints received by consumers or family members that these purchases are directly linked to deceptive claims."
The refund checks and notice from Fisher's Bureau of Consumer Protection will be mailed to more than 8,300 eligible consumers this week.
The $34 million settlement with PCH includes a $1 million civil penalty plus $13 million for the states' investigation costs and legal fees.
Fisher said his office plus representatives from five of the 25 states involved in the settlement will serve on a review board to monitor all solicitations and offers from Publishers Clearing House to ensure that they are in compliance with the settlement.
The Commonwealth's case is being handled by Senior Deputy Attorney General J.P. McGowan of Fisher's Bureau of Consumer Protection Office in Scranton.
CONTACT: Barbara Petito Deputy Press Secretary +1-717-787-5211
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CONTACT: Barbara Petito, Deputy Press Secretary of the Pennsylvania Attorney General's Office, +1-717-787-5211, or home, +1-717-236-6264
Web site: http://www.attorneygeneral.gov/