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Florida Sues Internet Promoter over 'Free' Gifts

Ads misled consumers into thinking they were getting something for nothing, state charges

August 27, 2007

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The office of Florida Attorney General Bill McCollum has sued a Delaware company headquartered in Boca Raton, alleging the company’s advertising may deceive consumers about offers of “free” gifts or prizes.

World Avenue U.S.A., LLC, and company chief executive officer NiuNiu Ji are named in the lawsuit, which cites significant problems stemming from the company’s Internet marketing practices, including concerns that consumers may be misled as they attempt to claim free offers of merchandise.

“My office is vigilant about anything that appears to be a deliberate attempt to misinform or mislead Floridians,” said McCollum. “I urge all consumers to be very cautious of any “free” gift offers. Things that sound too good to be true usually are.”

The Attorney General’s Economic Crimes Division has been investigating the company, which has operated under the name NIUTech and a myriad of others, since 2006.

The investigation revealed that consumers typically encounter the company through e-mail solicitations, Internet “pop-up” windows, or paid advertisements linked to Google and other search engines.

The ad suggests that consumers can receive “free” merchandise if certain program requirements are met.

The investigation focused on determining whether the promotional merchandise was actually “free,” and, if not, determining whether the terms and conditions for receiving the promotional items were clearly and conspicuously disclosed, in a manner which would not be likely to mislead consumers.

After extensive review of the company’s promotional offers, investigators concluded that neither the “Program Details” or “Terms and Conditions” found on the websites associated with the company’s offers clearly disclosed important caveats to the promotions.

Disclaimers should have stated that every “free” gift required the consumer to make one or more cash purchases, that the combined dollar amount of purchases required to receive the gift could exceed the retail value of the “free” gift. The total cost necessary to obtain the “free” gift should have also been disclosed.

Additionally, the lawsuit cites concerns that consumers were misinformed about the process for obtaining the free prize, including misleading statements about when the process would conclude.

Notice of the lawsuit was sent to governmental authorities in the U.S. Virgin Islands, where Niuniu Ji has relocated. Corporations similar to World Avenue have already been formed in the Virgin Islands, Ireland and Bermuda.

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