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Texas Sues Yellow Pages Directories

Charges Ad Telamerica defrauds small businesses, charities nationwide

November 9, 2007

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Texas Attorney General Greg Abbott has filed an enforcement action against an allegedly fraudulent “Yellow Pages” company and its owner for deceiving business owners, nonprofits, churches and other organizations.

Barbara Sommer and her company, Ad Telamerica Inc., which does business as Yellow Pages Directories, are charged with sending misleading direct mail pieces to businesses across the nation.

The mailers suggest that the recipients had a pre-existing relationship with the defendants and therefore owed money to maintain their business’s Yellow Pages Directories advertisement. Although the word “free” appears in several locations, recipients who think they need to renew their advertisement are required to pay about $300 for the listing.

“Deceptive mailings, hidden charges and the deceptive use of a well-known corporate logo were all part of a complex scheme to defraud small business owners and others,” said Attorney General Abbott. “Texas law provides important protections to shield businesses from false advertising schemes. The Office of the Attorney General will continue to enforce laws that protect small businesses.”

Since March 2006, Sommer and her company have mailed more than 2 million deceptive solicitations in an effort to lure customers from across the United States.

Sample mailing, provided by Texas AG

More than 19,000 of those contacted responded to the solicitation forms, which were printed with the words “Final Notice” in all capital letters, as well as the bolded words “listing confirmation form.” The form alarms customers by stating that the customer’s Yellow Pages listing will be omitted if the form is not returned, giving the business the false impression that it previously maintained such a listing.

The customers’ confirmation form includes the word “free” in several locations, leading them to believe they will not be billed if the form is returned. However, the business is expected to pay almost $300 for the listing, a detail that unlawfully appears only on the reverse side of the form in tiny print.

State law requires that advertisers clearly and fully disclose advertising costs. The company also includes the familiar “walking fingers” logo in its correspondence, which falsely implies that customers are entering into a business relationship with AT&T’s Yellow Pages.

The Attorney General’s legal action, brought under the Texas Deceptive Trade Practices Act (DTPA), requests that the court order restitution to recipients who were harmed by this scheme. The lawsuit seeks civil penalties of $20,000 per violation of the DTPA, as well as reasonable attorneys’ fees.

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