Craftmatic Denies Wrongdoing, Defends Sales Tactics

Company's lawyer lashes out at TV show

By Joseph S. Enoch
ConsumerAffairs.com

July 22, 2008

Craftmatic • Craftmatic Denies Wrongdoing, Defends Sales Tactics • Senator Prods FTC to Investigate Craftmatic Complaints • Craftmatic Settles Florida Charges • Craftmatic Settles WV Fraud Charges • Ohio Settles With Craftmatic Beds --- • Consumer Complaints

Responding to reports of a possible Federal Trade Commission (FTC) investigation into its sales tactics, the manufacturer of Craftmatic adjustable beds insists it has done nothing wrong and there is nothing illegal about its sales tactics.

"We haven't heard anything from the FTC and don't expect to," said Charles Chernofsky, an attorney that represents the company, which has abandoned the name Craftmatic and now goes by Contour.

FTC spokesman Mitch Katz said that just because the agency has not contacted the company does not mean there is no active investigation.

The company has been in trouble with various state Attorneys General and last year paid $4.4 million to the FTC to settle charges of Do Not Call violations.

The current uproar concerns allegedly pushy sales tactics. At least 139 consumers have complained about the company's aggressive sales practices to ConsumerAffairs.com.

"We called the company in response to a promotion for a chance to win a free bed," Josie of Pueblo, Colo., wrote to ConsumerAffairs.com. "Next thing we knew we had a man in our house selling us a bed we could not afford, sight unseen. We feel we were pressured into signing the contract.

"The salesman said it was the answer to all our health problems and gave the bed all these wonderful reasons of how it would help my husband's heart problems and his recent neck surgery and my leg edema, and help with our sleep apnea," Josie continued. "The stress of how we are going to pay for this monster has only made our problems worse."

These complaints were highlighted in a recent Inside Edition hidden camera investigation that showed two salesmen making what the broadcast said were over-the-top claims about the beds' potential health benefits. The footage also revealed one of Contour's sales instructors urging new salesmen to be especially attentive to elderly consumers.

That instructor, Carolyn Nilson, taught the new recruits to "put on a show" and make the sale as soon as possible.

"Not tomorrow, not after they talk to their doctor, their daughter, their son ... send their granddaughter through college, help out their, you know, blood-sucking leech-y kids," said Nilson while a hidden camera caught it all.

"Inside Edition is trash TV," Chernofsky said. "They're not interested in portraying a fair image."

Chernofsky later said Nilson was no longer training recruits as a result of the investigation, but didn't know if she still worked for Contour.

"There was a problem with that particular trainer," Chernofsky said.

He said the company has done nothing wrong and that the seemingly pushy sales tactics are perfectly fair and honest. He compared it to buying a used car.

"That's salesmanship," he said.

Chernofsky said there is nothing illegal about the health claims that salesmen have made for years to elderly consumers because the product has been approved by the Food and Drug Administration as a medical device.

According to FDA documents, the bed "may provide temporary relief" from the following medical issues: low back pain, minor muscle aches, edema, poor blood circulation in the legs, symptoms from hiatus hernia, symptoms from gastric reflux, nighttime heartburn, mild arthritis and joint pain and light and occasional snoring.

"We make no promises," Chernofsky said. "(But) every one of the health benefits are documented."

Despite that, Sen. Clair McCaskill (D-Mo.) was shocked by what she saw on Inside Edition and asked the FTC to get involved.

"Most alarming is the company's training and business practices that target the elderly population and employ high pressure sales tactics," McCaskill wrote in a March 10, 2008 letter to then-chairwoman of the FTC, Deborah Majoras. "In this instance, Craftmatic personnel made claims that their product would cure health conditions, such as acid reflux and back problems, and pressured vulnerable customers to enter into contracts and avoid consultation with family members or physicians."

The current chairman of the agency, William Kovacic, responded April 21.

"Like you, I was concerned to learn about the alleged high pressure tactics used by Craftmatic salesmen," Kovacic wrote. "I assure you that we will follow up on these serious allegations."

Chernofsky said the company has new owners who decided to change the name to avoid years of bad press the surrounding the company.

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