Current Events in July 2004

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    Illinois Charges Video Chain Denies Access to Disabled

    Illinois Attorney General Lisa Madigan has filed suit against an Illinois video store chain alleging that every single one of the company's 70 stores statewide has broken state law by failing to provide access to customers with physical disabilities.

    The obstacles range from sales counters too high for would-be movie watchers in wheelchairs to pay cashiers to entrance routes partially blocked by vending machines.

    Madigan's suit, filed in Sangamon County Circuit Court, alleges Springfield-based Family Video Movie Club, Inc., has violated disability laws governing access to public facilities, including retail stores.

    The Illinois Environmental Barriers Act and the Illinois Accessibility Code require that public facilities constructed or altered after 1988 be accessible to people with disabilities.

    Madigan's Disability Rights Bureau protects the rights of people with disabilities. On June 29, Madigan reached a record settlement with Walgreen Co. to resolve a suit filed last year alleging that many of the popular chain's more than 400 Illinois drug stores had barriers that limited access for individuals with disabilities.

    "The law could not be more clear," Madigan said. "People with disabilities should be able to conduct business in a public place just like anyone else. Most of us rent movies at one time or another and any failure to provide that opportunity to all citizens is inexcusable."

    To document the alleged violations, Madigan's office inspected 64 of Family Video's approximately 70 Illinois outlets between June 2002 and October 2003. Because the remaining six stores that were not inspected share the same standard design as the other stores, Madigan's complaint alleges the design flaws have resulted in one or more violations at every Family Video location in Illinois. Some of the alleged violations include:

    • Counters that are so high that both employees and customers with disabilities would have to transact business on countertops above their heads. Also, a four-inch step that prevents a wheelchair user from accessing the employee work area behind the counters at all Family Video stores.
    • Parking spaces designated as accessible that do not meet mandatory width requirements, making it difficult or impossible for a person with a disability to open a vehicle door wide enough to exit a parked car.
    • Accessible parking spaces that are located on an incline that is too steep to allow a disabled person to stabilize a wheelchair and transfer into it from a car. Also, designated parking access aisles that are not level, making it difficult to deploy van lifts and transfer persons with disabilities out of a van.
    • Not enough accessible parking spaces are available for people with disabilities.
    • Spaces designated accessible that are not located on the shortest path of travel to the entrance as required by law, which could force individuals with disabilities such as heart and lung conditions or chronic pain to walk dangerous distances to access the store.
    • Entrances and exits that exceed the maximum force needed to push or pull open a door and sidewalks and entrances obstructed by vending machines, trash containers and flower pots. Both violations make it impossible for a disabled person to use the sidewalk and enter or exit the stores.
    • Accessible parking spaces that do not display the proper Department of Transportation R7-8 reserved accessible parking sign and do not post a fine for illegal use of accessible parking spaces by non-disabled individuals.
    • Paths of travel to the video store entrances that have ramps so steep they could prevent a disabled person from accessing the store areas from the street or parking lot.

    "Complaints against Family Video filed in our office date back to 1997. The company has been afforded every opportunity to correct these serious violations of the law," Madigan said. "Not only is the company risking its bottom line in court, it's risking its bottom line by denying access to potential customers."

    The suit seeks to order Family Video (1) to conduct a statewide survey of all its stores and document existing violations of the Illinois Accessibility Code and (2) to correct all violations and (3) to pay fines, penalties and costs of up to $250 per day for each violation of accessibility laws.

    Illinois Charges Video Chain Denies Access to Disabled...

    Nigerian Scams Use TTY Lines

    It's the latest variation on the 419 scam

    There may be no such thing as a new idea but there are almost endless variations on proven scams. The latest is a variation of the so-called "419 scam," named after the penal code that prohibits them in Nigeria.

    We've all gotten the spam messages about a Nigerian prince promising rich rewards in exchange for a relatively small payment mailed to a mysterious overseas address. Now, 419 scammers have begun preying on businesses of all types -- including home medical equipment providers.

    And instead of using the Internet, scammers are using TTY lines for the hearing impaired, which makes their calls untraceable.

    "[One caller using a TTY line] wanted to purchase all of our blood pressure monitors," said Sandy Jones, owner of Austin Respiratory in Clearwater, Florida.

    Jones sold the caller all the monitors she had, charged the caller's credit card for $600 and, after signing a $300 UPS bill, sent a large package overnight to Africa. She had sold equipment to immigrants before who sent products overseas, she said, so why should this be any different?

    Shortly after, the bank that issued the credit card alerted Jones that she had been a victim of fraud and, because the criminal was at large overseas, her company would have to pay back the bank. According to authorities, the blood pressure monitors Jones sent are now most likely being sold on the Nigerian black market.

    Extremely large orders, often for a vendor's entire stock of a particular product, should send up warning flags, authorities said, adding that the scammers frequently say they need the entire order shipped overnight, often to Nigeria.

    Because of the international nature of the crime, it's unlikely law enforcement agencies will be able to help, so the answer lies in education of consumers and small businesses.

    419 scammers have begun preying on businesses of all types-- including home medical equipment providers. Scammers are using TTY lines for the hearing impai...

    Brits OK Cell Phones in Hospitals

    Better communication outweighs risk of radio interference

    A British agency has declared that a total ban on cell phones in hositals is not necessary. Rather, the Medicines and Healthcare products Regulatory Agency (MHRA) says hospitals should introduce reasonable measures to balance the risks of mobile phones interfering with critical devices and the desire for better communication in hospitals.

    The agency said the new advice takes account of recent developments in mobile technology and the growing communication needs of patients, visitors and hospital staff.

    Some mobile devices can cause interference with critical medical equipment and it is important these are turned off where a risk exists, said Prof. Kent Woods, Chief Executive of the MHRA. However, he said there is no reason why mobile technology can't be used in designated areas of hospitals where there is little or no risk of interference with critical medical equipment.

    "Mobile technology can be an easy and quick way for staff to communicate and help them to deliver the best possible care to patients. Overly restrictive policies can act as obstacles to this beneficial technology so this updated advice will help ensure that hospitals reap the benefits of mobile technology without compromising patient safety," Woods said.

    Brits OK Cell Phones in Hospitals...

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      Court Order Against Jennifer Convertibles

      A court judgment requires Jennifer Convertibles to significantly reform its practices and to provide restitution to consumers

      A court judgment requires Jennifer Convertibles to significantly reform its practices and to provide restitution to consumers, New York Attorney General Eliot Spitzer announced.

      The judgment permanently enjoins Jennifer Convertibles from engaging in deceptive, fraudulent or illegal business practices, and requires the company to make substantial reforms to its sales practices and customer service operations.

      The judgment also requires Jennifer Convertibles to make restitution to consumers for its failure to replace or repair defective goods. In addition, Jennifer Convertibles agreed to pay $275,000 in penalties, and $2,000 in costs.

      "My office will continue to commence enforcement actions against companies that violate the law by engaging in deceptive practices," Spitzer said. "The court's order requires the company to change its business practices and ensures that those customers who have received defective merchandise from Jennifer Convertibles will receive restitution."

      The company, based in Woodbury, Long Island, operates retail stores in 21 states with more than 50 showrooms in New York State.

      The charges against the company sound familiar to Janet of Montclair, CA, who complained to a few months ago about Jennifer's failure to remedy problems with a sofa and loveseat despite the $200 she spent on the company's "lifetime" protection plan.

      "I called to make a claim and they said someone will call me within five days. No one ever did. When I called back the lady said sorry it's not their problem. I feel so ripped off," Janet said.

      Jennifer Convertibles agreed to the consent judgment after the Attorney General filed a motion for contempt in April 2004 alleging that the company was in violation of a 1998 order that prohibited deceptive business practices. The 1998 order was obtained after hundreds of consumers filed complaints with the Attorney General's office.

      However, since January 2000, Spitzer's office has received more than 200 new complaints alleging that Jennifer Convertibles failed to provide refunds for damaged or defective furniture, failed to repair or replace defective merchandise, and did not honor guarantees and warranties.

      Under the new judgment, Jennifer Convertibles is required to give new consumers full notice of their rights to obtain refunds for damaged or defective goods, or to elect to have the merchandise repaired or replaced. The judgment also requires Jennifer Convertibles to honor its warranties and guarantees, and clearly disclose any restrictions on them. In addition, the company has agreed to improve its customer service operations, by maintaining a toll-free telephone number for consumer inquiries, providing proper training for its customer service representatives and promptly responding to consumer complaints.

      Consumers who believe they may be eligible for restitution should file a complaint with the New York State Attorney General's Office no later than 180 days from July 21, 2004. Consumers may contact the Attorney General's consumer help line at (800) 771-7755.

      A court judgment requires Jennifer Convertibles to significantly reform its practices and to provide restitution to consumers, New York Attorney General El...

      Judge Orders Canadian Lottery Scam Artists to Pay $19 Million

      A federal judge has ordered Canadian telemarketers running an illegal foreign lottery scam that targeted senior citizens in the United States to pay $19 million

      A federal judge has ordered Canadian telemarketers running an illegal foreign lottery scam that targeted senior citizens in the United States to pay $19 million in consumer redress and has ordered a permanent halt to the scam.

      Chicago U.S. District Court Judge Amy St. Eve wrote that the defendants made false or misleading statements to induce consumers to purchase shares or interests in lottery tickets, including that it is legal for them to sell foreign lottery tickets and for consumers to purchase them. She ordered defendants George Yemec, Anita Rapp and World Media Brokers, Express Marketing Services, and three other corporations they own and control to pay $19 million.

      In September 2002, the Federal Trade Commission (FTC) filed a complaint in U.S. District Court in Chicago charging that a group of related companies operated by six Canadians was running telemarketing boiler rooms targeting seniors in an illegal foreign lottery scheme. The FTC alleged that the telemarketers told the consumers that by investing with them, the consumers had a very good chance of winning the Canadian lottery.

      According to the FTC, the telemarketers told many consumers that it is legal for U.S. consumers to buy Canadian lottery tickets. They told some consumers that they had already won a large prize and that consumers should send them money to redeem their winnings. The agency charged them with violating the FTC Act and the Telemarketing Sales Rule.

      On October 1, 2002, U. S. District Court Judge Amy St. Eve issued a temporary restraining order. Eleven of the 14 defendants agreed to abide by the provisions of the temporary restraining order, pending trial. In December, the court granted a preliminary injunction halting the operation.

      At the request of the Federal Trade Commission, the court temporarily barred the defendants from selling tickets, chances, or any foreign lottery chances to residents of the United States; barred deceptive claims about the chances of winning the Canadian lottery; prohibited misrepresentations or omissions about material facts; and ordered an asset freeze to preserve funds for consumer redress, pending trial.

      First British National Holdings Ltd.

      In another case targeting cross border lottery scams by telemarketers, the FTC charged defendants in British Columbia who offered British Bonds and lottery winnings to mostly elderly consumers in the United States and the United Kingdom with violating federal law.

      In a complaint filed in May 2002, the agency alleged that the defendants told their victims they were likely to receive a large return on their bond investment. The agency alleged that consumers were unlikely to receive any return, let alone a large return, and that it is illegal to sell or buy foreign lotteries in the U.S. The defendants were charged with violating the FTC Act and the Telemarketing Sales Rule. The defendants in the case are First British National Holdings Ltd, Omid Tahvili, and Reginald Pal.

      A Stipulated Order filed in District Court for the Western District of Washington, in Seattle, bars the defendants from promoting or selling tickets, chances, interests, holdings, or shares in any foreign lottery or bond to any U.S. resident. It also bars them from making misleading or false statements to induce consumers to pay for goods and services and bars them from selling or sharing their customer lists.

      A judgment of $1.3 million is suspended on payment of approximately $400,000 for consumer redress. Reflecting the international nature of the scam, the Stipulated Order obtained by the FTC authorized consumer redress payments to victims in both the U.S. and the U.K.

      Royal Flush System Network, Inc.

      In May 2003, the FTC charged three individuals with using four corporations to engage in illegal telemarketing to U.S. consumers. The agency alleged that the defendants' telemarketers persuaded consumers that they would win the German, Spanish, or other foreign lotteries if they paid the defendants to play on their behalf. Consumers also were told they had won large sums of money but needed to pay a fee to collect their winnings.

      Defendants also ran a recovery room scheme, advising consumers that for a fee, the defendants would recover money the consumers had previously lost in the defendants earlier scams. The FTC alleged that two other individuals had improperly taken possession of assets that were the proceeds of the fraudulent lottery operation.

      Two defendants, Wilson Okike and Basil Steeves, were arrested in the United States, pleaded guilty to criminal wire fraud charges, and were sentenced to serve time in U.S. prisons. A settlement judgment filed in the District Court in Seattle provides for payment of $371,000 from assets frozen by Canadian authorities from Wilson Okike, Uchenna and Obiagele Okike, Royal Flush System Network, Inc., ECAPS Credit Solutions Network Inc., Globallot Services, Inc., and Flash Productions, Inc.

      When combined with funds forfeited in criminal proceedings, more than $500,000 will be available for consumer redress.

      Judge Orders Canadian Lottery Scam Artists to Pay $19 Million...

      NHTSA Closes Probe of Unintended Acceleration in Toyota, Lexus Models

      July 28, 2004
      Federal safety investigators have closed their probe into reports of unintended acceleration in 2002 and 2003 Toyota Camry, Camrty Solara and Lexus ES300 models. The National Highway Traffic Safety Administration (NHTSA) opened the investigation after receiving reports of 30 accidents, including one in which a pedestrian was injured.

      The probe centered around the cars' electronic throttle control. Many newer cars transmit acceleration signals electronically rather than using the traditional movable steel cable.

      NHTSA said it analyzed many of the cars involved in the mishaps and found nothing abnormal with the throttle controls. It said sudden surges are sometimes caused by drivers who are unfamiliar with their new vehicles.

      NHTSA Closes Probe of Unintended Acceleration in Toyota, Lexus Models...

      Four South Florida Residents Charged with Patient Neglect

      Florida Attorney General Charlie Crist has announced the arrests of three South Florida residents and charges against a fourth for patient neglect at the Colonnade Regional Medical Center in Lauderdale Lakes.

      The Attorney General's Medicaid Fraud Control Unit began investigating Colonnade based on complaints and information provided by the Department of Children and Families' Adult Protective Services Unit, as well as local media reports. The investigation revealed that facility residents did not receive the medications prescribed by their physicians, did not receive proper nutrition for their special conditions, did not have access to adequate and informed staff, and endured poor sanitary conditions. In one case, a resident with a history of severe mental illness was found in his wheelchair at a busy intersection outside of the facility.

      "Those responsible for this neglect obviously do not understand the meaning of the word 'caregiver,'" said Crist. "It is outrageous that some of Florida's most needy citizens have been put in such danger. We will continue to track down and hold accountable those who would take advantage of the elderly and disabled."

      The residents of Colonnade were forced to live in substandard conditions despite repeated warnings that the owner must take corrective action. In addition, the facility failed to pay its own staff consistently and many employees went for months without receiving any pay at all. During the last year, then-owner Gary Lampert received more than $3.5 million in Medicaid payments.

      Arrested on Tuesday were Sharon Brown, 33, of Lake Worth, the former Director of Nursing; and Sandra Rothstein Frank, 49, of Coral Springs, Lampert's former girlfriend who was employed as the facility's dietician and as a corporate officer. Each was charged with 10 counts of patient neglect. In addition, Regine Roy, 27, of Miramar, was arrested and charged with one count of patient neglect. Lampert, 53, of Miami Beach, the former facility owner and administrator of Colonnade, remains at large. Patient neglect is a third-degree felony and each count carries a maximum penalty of 5 years in prison and a $10,000 fine.

      Colonnade nursing home has been in receivership since July 2003, preventing Lampert from further involvement in patient care.

      Four South Florida Residents Charged with Patient Neglect...

      Saturn Vue Suspension Collapses in Government Tests

      Rear wheels collapsed during the test

      Federal safety officials have opened an investigation into the Saturn Vue after the suspension failed on two of the SUVs during recent government tests, causing the rear wheels to collapse.

      The National Highway Traffic Safety Administration (NHTSA) said the agency had received a consumer complaint about a similar incident that led to a rollover. The suspension failures occurred as the agency was following up on that complaint.

      The failures occurred on both a four-wheel-drive and a two-wheel-drive Vue. NHTSA said the four-wheel-drive vehicle's suspension failed at 45 miles per hour as it was being put through a series of sharp turns meant to resemble sudden swerves and accident avoidance maneuvers. It didn't say how fast the two-wheel-drive vehicle was going at the time of the failure.

      NHTSA said only that it has opened a defect investigation, a process that can take a year or more and which can lead to a recall.

      The Vue and other SUVs have been under heightened scrutiny because of the rising incidence of rollovers involving SUVs and pickups.

      Consumer advocates pounced on the incident, calling on GM to launch an immediate recall. Clarence Ditlow of the Center for Auto Safety called it "truly amazing" that the same failure occurred in two vehicles, which he said was a clear indication of a design flaw.

      Saturn Vue Suspension Collapses in Government Tests...

      Toyota RAV4 Wins "Double Best Pick" Safety Rating

      But Same Model Gets "Poor" Rating Without Side Airbags

      The 2004 Toyota RAV4 came up a winner and a loser in the latest Insurance Institute for Highway Safety crash test. The small SUV was the first vehicle to earn good ratings and "best pick" designations for both front and side impact crashes -- but only when it was equipped with optional side airbags.

      But without the optional side airbatgs, it tested poor for side impact protection.

      "Results for this small SUV show manufacturers can provide good protection for occupants in the two most common kinds of serious crashes," says Institute chief operating officer Adrian Lund. "Unfortunately Toyota hasn't made side airbags standard, and the RAV4 without side airbags is still rated poor for side impact protection."

      The Institute also tested the Subaru Legacy, which earned a good rating and a "best pick" designation in the frontal test but a marginal rating in the side impact test. This midsize inexpensive car was redesigned for the 2005 model year.

      The RAV4 was tested because of the recent addition of side airbags and because Toyota made some changes to the vehicle's front-end structure to improve frontal crash performance. Both the RAV4 and the Legacy belong to groups of vehicles that the Institute evaluated in earlier front and side crashes.

      This is the third version of the RAV4 evaluated in the Institute's frontal test.

      "In the first frontal crash test in 1998, the RAV4 was a marginal performer," Lund says. The dummy's head hit the window frame during the crash. Its knee hit a metal flange under the steering column, which punctured the dummy's vinyl "skin." High accelerations were recorded on the dummy's head and chest. There also was a likelihood of injury to the left leg.

      The RAV4 was redesigned in 2001, and its performance improved. "But it still was rated only acceptable in the frontal test," Lund says. High accelerations were recorded when the dummy's head struck the steering wheel through the driver airbag, and forces on both legs indicated the possibility of injuries.

      For 2004 model RAV4s manufactured after December 2003, Toyota made structural modifications to improve offset test performance.

      "RAV4s with the modifications are much improved," Lund says. "The dummy's movement during the crash was well controlled, and injury measures taken from the head, neck, and chest all were low. The new RAV4 is now a good performer and a best pick' in the frontal test."

      RAV4's side test results improve with side airbags: In the Institute's first set of side impact tests of small SUVs, the 2003 RAV4 was among seven designs that earned the lowest rating of poor. Only the Subaru Forester with standard side airbags and the 2001-04 Ford Escape with optional side airbags earned good ratings. The Hyundai Santa Fe with standard side airbags was rated acceptable.

      Side airbags are reducing risks in real-world crashes, the Institute claims. Its research shows that in vehicles with side airbags to protect the head, the risk of a fatal injury is reduced by 45 percent among drivers of cars struck on the driver side. Side airbags that protect the chest and abdomen, but not the head, also are reducing deaths but are less effective (about a 10 percent reduction in deaths).

      Before the availability of head-protecting airbags, there was virtually nothing to prevent people's heads from being struck by intruding vehicles or rigid objects like trees or poles in serious side impacts.

      The Institute recently tested 13 midsize car designs, and only the Honda Accord and Toyota Camry with optional side airbags earned good ratings. The Chevrolet Malibu with side airbags was acceptable. The rest were poor.

      Toyota RAV4 Wins ...

      Metabolife Founder Indicted

      July 22, 2004
      A federal grand jury has returned an eight-count indictment against San Diego-based Metabolife International, Inc., and its founder, Michael J. Ellis.

      The indictment charges both defendants with six counts of making false, fictitious and fraudulent representations to the Food and Drug Administration (FDA), and two counts of corruptly endeavoring to influence, obstruct and impede proceedings concerning the regulation of dietary supplements containing ephedra being conducted by the FDA.

      Until the FDA banned the sale of ephedra in the United States in 2003, Metabolife was one of the largest retailers of dietary supplements in the United States, based largely on sales of its ephedra-based product, Metabolife 356.

      Metabolife and Ellis are charged with falsely representing a number of different material facts to the FDA in letters dated April 17, 1998 and February 9, 1999. These representations included false statements by the Defendants that Metabolife ha[d] never received one notice from a consumer that any serious adverse health event has occurred because of the ingestion of Metabolife 356 and that the company had a claims-free history, according to United States Attorney Carol C. Lam.

      "It is never acceptable for corporations to lie to regulatory agencies, but it is particularly egregious when those lies threaten the public health," Lam said.

      "One of FDA's highest priorities involves our responsibility to ensure that information about products we regulate is truthful and not misleading, because people depend on that information to make informed choices," said Acting FDA Commissioner Dr. Lester M. Crawford. "We will pursue to the full extent of the law those who would seek to mislead consumers by providing false information or impeding investigations of risky products."

      The defendants are scheduled to be arraigned before Magistrate Judge Louisa Porter in San Diego on Tuesday, July 27, 2004 at 10:30 a.m.

      Each charge carries a potential penalty of five years in prison and a $250,000 fine.

      A federal grand jury has returned an eight-count indictment against San Diego-based Metabolife International, Inc., and its founder, Michael J. Ellis....

      Breuners, Huffman Koos, Good's Furniture Chain Declares Bankruptcy

      Consumers who have already placed deposits or have plans to shop during the bankruptcy should exercise severe caution

      Breuners Home Furnishings Corp. has filed for bankruptcy and is expected to close most of its 47 Breuners, Huffman Koos and Good's stores nationwide. 

      Consumers who have already placed deposits or have plans to shop during the bankruptcy should exercise severe caution. The ongoing bankruptcy proceedings could limit customer rights and claims.

      Connecticut Attorney General Richard Blumenthal said he has serious concerns about an initial court order that sets forth rules for customers and will object to several of the conditions. The chain is closing all six of its stores in Connecticut.

      Blumenthal urged customers with outstanding bills or those making new purchases to pay by credit card whenever possible. Customers who pay with cash or a cashier's check should first confirm prompt or immediate delivery. All items now sold at the stores are "as is," and consumers cannot get a refund, exchange or credit, although the stores will attempt to pass on manufacturer's warranties where possible.

      Because of these limitations, consumers should closely inspect any product they plan to buy.

      "Caution and common sense are the best approach," Blumenthal said. "We are strongly scrutinizing the Huffman Koos bankruptcy proceedings, but the final terms of the liquidation sale remain fluid. The bankruptcy court's initial order is fundamentally flawed allowing only minimal time to notify customers of their rights before they risk losing their deposits."

      The Attorney General's office is also monitoring and will strongly oppose or seek to restrict any plans to allow "augmentation" at Huffman Koos stores. Augmentation is a practice where stores sell products not normally sold at their stores, which if unrestricted can deceive customers into believing that the products meet the same quality standard as the stores' usual inventory.

      The company had 20 stores operating as Huffman Koos in New York, New Jersey, and Connecticut, 17 Good's Furniture stores in Pennsylvania, New Jersey, and Delaware, and 10 Breuners Home Furnishings stores in northern California. Its headquarters was in Lancaster, PA.

      Breuners, Huffman Koos, Good's Furniture Chain Declares Bankruptcy...

      Cell Phone Carriers Agree to New Ground Rules in 32 States

      Three of the largest cell phone providers have reached agreement with 32 state Attorneys General, agreeing to provide more accurate coverage maps, give customers at least two weeks to terminate contracts without incurring penalties and improve how they market services to consumers.

      The settlements, announced by Illinois Attorney General Lisa Madigan, affect almost 90 million customers nationwide of Verizon Wireless, Cingular Wireless and Sprint PCS. Each carrier will pay $1.67 million of a total of $5 million to the states to cover the cost of the investigation and to support consumer education.

      These agreements mean millions of Verizon Wireless, Cingular Wireless and Sprint PCS customers will be provided with the complete and accurate information necessary to make an informed choice about which plan best suits their needs, Madigan said. More importantly, if consumers are not satisfied, they now have a clear exit out of a contract.

      The attorneys general first began investigating the companies for possible violation of consumer protection laws three years ago after receiving complaints about misleading advertisements and service agreements,

      Madigan said a major concern was the carriers coverage maps, referred to as rate maps, because they indicate where particular rates are available. Madigan said rate maps often were deceiving because they simply were colored-in maps of the entire United States.

      Coverage was not always available in the entire calling area for a variety of reasons, including lack of cell towers, lack of roaming agreements, lack of capacity to accommodate peak call periods and obstructions such as buildings, hills and trees.

      Verizon Wireless, Cingular Wireless and Sprint PCS now will be required to provide coverage maps that are as accurate as possible using current technology.

      In addition, the companies have agreed to:

      • Provide new customers with a two-week minimum service trial to make sure service is available when and where they need it. During the trial period, new customers will be permitted to terminate their contract for any reason without having to pay an early termination fee.
      • Provide a full refund of activation fees if consumers decide to cancel their contracts within the first three days of service, excluding national holidays.
      • Fully disclose the costs and limits of their wireless services in all retail, Internet and telemarketing sales.

      All three of the companies said they are already in compliance with the settlement terms and have made changes in their maps and advertisements since the inquiries began.

      Mobile carriers were the No. 2 industry for complaints to Better Business Bureaus last year, after auto dealers. The industry had the second-lowest consumer satisfaction ranking, beating only cable providers, in the University of Michigan's June consumer satisfaction index. The Federal Communications Commission received 21,357 consumer complaints about wireless service in 2003, and 2,133 of those were related to the way companies market and advertise.

      Cell Phone Carriers Agree to New Ground Rules in 32 States... Settles NY Spamming Charges

      The spam was illegally routed through a worldwide network of more than 500 vulnerable computers has agreed to settle charges that it sent spam containing falsified headers, falsified routing information, and deceptive subject lines and that the spam was illegally routed through a worldwide network of more than 500 vulnerable computers.

      "This settlement holds (company owner Scott) Richter and his company to a new standard of accountability in their delivery of emails," said New York Attorney General Eliot Spitzer. "If he does not fulfill these standards, he will find himself back in court, facing greater penalties."

      The Attorney General had sued Richter, his company, his agent, and the marketer that hired him, after an investigation into millions of emails sent over the course of a month to Hotmail email accounts that had been set up specifically to investigate spammers. During that investigation, culminating in a lawsuit filed in December, the Attorney General's Internet Bureau reviewed more than 10,000 emails sent by the defendants.

      Spitzer's suit alleged that during May and June 2003, the defendants sent millions of emails that:

      • Used fake names in the emails' "From:" lines, often the recipient's own name making it appear as if the recipient had sent the email himself;
      • Used the names of other, well-known companies in the emails' "From:" lines;
      • Used forged email addresses in the emails' "From:" lines in an attempt to hide the true source of the emails;
      • Used forged email addresses that led some to believe that their email accounts had been hijacked by spammers;
      • Used deceptive subject lines that falsely indicated that the emails were part of an ongoing conversation;
      • Used deceptive subject lines that falsely indicated that the email was about or from a different, well-known companies; and
      • Were routed through more than 500 compromised computers worldwide in order to hide the true source of the email. These computers belonged to a diverse group ranging from IntelliSpace, Inc., an Internet service provider in New York City to Singer Computer, in Russia, Seoul Municipal Hospital in Korea, and even the Kuwaiti Ministry of Finance.

      The Consent Order requires Richter and OptInRealBig to submit to a range of standards and safeguards that prohibit the practices described above. In addition to being strictly prohibited from the above practices, whether directly or through their agents, they must abide by a number of additional safeguards:

      • They must retain and provide to the Attorney General detailed customer information and purchase records;
      • They must retain and provide copies of all advertisements they send, all complaints they receive, and the names of all agents and employees;
      • They are prohibited from using false identifying information when registering domain names;
      • They are prohibited from deceptively routing emails through IP addresses that are not their own.
      • They must pay the State of New York $50,000 in penalties and costs.

      "The most complex aspect of spam investigations is efficiently identifying and locating those responsible," Spitzer said. "This agreement will allow us a measure of transparency into the practices of one of the biggest distributors of commercial emails in the world."

      The case against New York-based Synergy6, Inc., Justin Champion, Delta Seven Communications, LLC, Paul Boes, and Denny Cole, each of whom was named in the complaint for directing or assisting in the illegal activities at issue, will continue. In addition, a parallel action brought by Microsoft for injunctive relief and additional monetary damages in the State of Washington will continue. settled on charges of sending spam with falsified headers, routing information and deceptive subject lines illegally through more than 500...

      New York, Illinois Sue Car Dealers for Deceptive Practices

      One dealer sold consumers used rental cars

      Two New York car dealers have agreed to pay restitution to consumers who unknowingly purchased former rental cars. Meanwhile, Illinois has filed suit against an Ohio-based ad agency that created ads trumpeting the sale of low-priced cars allegedly available because a major rental car company had gone bankrupt, as well as the dealer who sponsored the ads.

      New York Attorney General Eliot Spitzer said his office has obtained agreements with DeNooyer Dodge of Albany and Haynes Ford in Hoosick. Each agreed to pay restitution to consumers and to implement practices to ensure that customers are appropriately notified that a used car was formerly a rental car.

      "Consumers deserve accurate and complete information about vehicles they are considering for purchase or lease," Spitzer said. "My office will continue to aggressively enforce the state law that requires auto dealers to provide notice about a vehicle's prior use as a rental car so that consumers can make informed decisions about whether they want to purchase that car and what the value of that car might be."

      In settling the investigations, both auto dealers agreed to pay $1,500 to each consumer who unwittingly purchased former rental vehicles without proper notification. DeNooyer Dodge will pay restitution to at least twelve consumers and Haynes Ford will pay restitution to at least nine consumers, resulting in $33,000 in refunds in total.

      Both dealerships also agreed to pay restitution to additional consumers who file bona fide complaints that they recently purchased a vehicle from either auto dealership and were not properly notified of the vehicle's prior history as a rental car.

      In the Illinois case, one ad featured a screaming headline urging prospective car buyers to BE AWARE. MAJOR CAR RENTAL COMPANY HAS GONE BANKRUPT. Vehicles Released to the Public for Immediate Sale. Another ad carries an important, official-sounding NOTICE TO THE PUBLIC. MAJOR RENTAL CAR COMPANY HAS GONE BANKRUPT.

      In fact, the attorney generals office found no evidence of a bankruptcy filed by a large rental car agency.

      Advertising agencies and the dealerships that hire them are not allowed to make up whatever they think will bring the customers to the lot. The ads must be accurate, Madigan said. Consumers reading these ads may have gone down to these dealerships to look at one of these vehicles only to find that they did not exist. This is misleading, and it is illegal.

      Madigans office already has sued a Des Plaines auto dealer for running a similar ad in Chicago in April. Madigan today amended the April lawsuit to add the advertising agency as a defendant.

      Madigans new complaint was filed in DeKalb County Circuit Court against Joyce Pontiac GMC and Jeep Eagle, Inc., and Gunning & Associates Marketing, Inc., for violations of the Illinois Consumer Fraud and Deceptive Practices Act.

      New York, Illinois Sue Car Dealers for Deceptive Practices...

      Iowa Bars California "Alternative" High School

      An Iowa court has ordered the California Alternative High School of Ventura to stop recruiting students or conducting classes in Iowa. Iowa Attorney General Tom Miller said the privately-owned school may have deceived consumers by claiming that its program would produce the equivalent of a high school program.

      The school's program reportedly cost about $600 for ten weeks of classes, three hours per week.

      The Iowa Consumer Protection Division told the court it appeared that the company tended to target lower-income Latino and immigrant populations with representations of college admission upon completion.

      The filing said it appeared that the company's representations "were deceptive, due to the fact that it appeared that few if any colleges or universities would admit students based upon graduation" from California Alternative High School's unaccredited educational program.

      The Nebraska Attorney General sued the school earlier and Indiana is investigating it.

      A Los Angeles County Superior Court judge issued an injunction against the school in April, barring it from stating in advertisements or directly to students that it offers an official high school education or diploma, the Ventura County Star reported.

      Los Angeles attorney Stephen Shikes sought the injunction on behalf of three of the school's graduates.

      "Students think that when they sign up for his program, they're going to get a full-fledged high school diploma, and in fact they're not getting one," Shikes said, according to the Star.

      The school denies that it misleads students. However, in each student workbook, CAHS lists several recognitions or approvals. Included on that list are these statements, the Star said:

      • CAHS is legally constituted within the state of California and is so authorized to confer the high school diploma.
      • Recognized by states, federal government and United States Department of Education for students to participate in financial aid programs.
      • Students are admitted at accredited colleges and universities.

      But the school is not authorized by any state agency to award high school diplomas; in fact, such programs are not regulated in California. Having a degree from the school has no bearing on a student's eligibility for college financial aid.

      Community colleges in California do not require high school diplomas for admission. Most accredited four-year colleges and universities, including University of California schools, California State University schools and California Lutheran University, require high school diplomas from accredited schools. Colleges and universities in Iowa and Nebraska also will not accept the CAHS diploma.

      "When selling services, you can't engage in deceptive misrepresentation. We believe we have a very good case for consumer fraud," said Bill Brauch, director of the consumer protection division of the Iowa Attorney General's Office, which obtained an injunction to stop CAHS from operating in the state.

      The school's "principal" and owner, Daniel A.D. Gossai, said the program would not be successful if it weren't improving students' lives. He said he operates in 12 states, including at least eight sites in Southern California, and hopes to expand the program to all 50 states within 18 months.

      An Iowa court has ordered the California Alternative High School of Ventura to stop recruiting students or conducting classes in Iowa after allegedly commi...

      New York Sues Companion Care Service

      VIP failed to properly protect its clients, state charges

      New York Attorney General Eliot Spitzer has filed suit against a Central New York company for failing to protect the health and safety of elderly individuals for whom it provides companion care services.

      V.I.P. Companion-Care of Syracuse and Skaneateles are accused of failing to comply with a county law that requires background checks and criminal history screenings for all individuals who provide companion care.

      According to the lawsuit, V.I.P. claimed that its employees were "thoroughly screened" for their clients' "peace of mind." However, state investigators found that no such checks were undertaken.

      "It is imperative that companies that provide companion care services follow the law aimed to protect vulnerable seniors from criminal activity that may endanger their health, safety and finances," Spitzer said.

      A 1991 Onondaga County law requires providers of companion care services to obtain the results of criminal background checks and identification cards for prospective employees from the County Sheriff's Department. It also requires employees to submit to fingerprinting by the Sheriff's Department.

      Spitzer's lawsuit also alleges that V.I.P. has engaged in other deceptive practices, including billing irregularities, unconscionable contract language and false advertising. In addition, the lawsuit alleges that V.I.P. has failed to comply with New York's Door to Door Sales Protection Act, which requires that consumers be provided with notice of their right to cancel a contract within three business days.

      In filing the lawsuit, Spitzer's office is seeking to permanently enjoin V.I.P. Companion-Care from entering into any contract or agreement to provide for companion care services until the company has fully complied with the local law requiring background checks and the Door to Door Sales Act. The lawsuit also seeks restitution for consumers who have been overcharged for services.

      Companion care services offered by V.I.P. include "live-in companions" and adult sitters who provide companionship services, respite care for caregivers, transportation and errands, medical reminders, meal preparation, and light housekeeping.

      This is the second enforcement action brought by the Attorney General's Office against V.I.P. Companion-Care. In 1998, the company entered into a court-ordered settlement addressing problems similar to those identified in today's lawsuit.

      The suit also names the company's operators, Andrew Buck and his parents, Girdon E. and Cecile Buck,

      New York Sues Companion Care Service...

      Whirlpool Named in Class Action Suit

      A class action complaint charges Sears Roebuck & Co. and Whirlpool Corp. with promoting and selling defective Calypso washers to consumers throughout the United States.

      The class action suit alleges that there are inherent defects in Calypso washers. It charges that despite many complaints from consumers, Whirlpool and Sears have refused to notify consumers of the defect, repair the defect or recall the Calypsos. Instead, they have continued to sell the defective machines nationwide.

      According to the lawsuit, the Calypsos suffer from problems including U-joint failure, circuit board malfunction and filtration problems that cause streaking and poor quality washes. The suit seeks repair, replacement or compensation for all purchasers of the affected washers.

      The complaints echo those filed with A Morrow, Georgia, consumer complained that after numerous attempts to fix her machine, Whirlpool replaced it with another Calypso, which also failed.

      Rudy of Aurora, Colorado, complained of repeated "long drain" problems with his machine, resulting in clothes not being spun properly.

      The suit was filed in Cook County Circuit Court on June 29.

      A class action complaint charges Sears Roebuck & Co. and Whirlpool Corp. with promoting and selling defective Calypso washers to consumers throughout the U...

      Pfizer Will Offer Deep Discounts to Uninsured

      Drug giant Pfizer says it will deeply discount its drugs for Americans without health insurance and give away more free drugs to low-income patients. The move puts pressure on other drug companies and is expected to affect the reimportation debate in Congress.

      Pfizer predicted savings averaging 37 percent for uninsured families making $45,000 a year or less. Pfizer projects that families without health insurance making more than $45,000 a year will save 15 percent.

      Secretary of Health and Human Services Tommy Thompson praised Pfizer for providing assistance to uninsured families, while members of Congress offered bipartisan praise. Sen. Rick Santorum (R-Pa.) said the initiative shows how private innovation can aid public-policy challenges.

      Sen. Hillary Clinton (D-N.Y.) applauded the initiative and urged other organizations to do what they can to provide similar benefits to patients that lack health insurance. Sen. Jon Corzine (D-N.J.) said Pfizer is a model of corporate responsibility that has really stepped up to the plate.

      Pat Kelly, president of Pfizers U.S. Pharmaceuticals unit, said the company wants to build momentum with its initiative so that other drug companies will want to follow suit. Kelly said he hopes people will begin to think better of the pharmaceutical industry, which has been dogged by criticism over high drug prices and undue influence in Washington.

      Robert Hayes, president of the Medicare Rights Center, a patient advocacy group traditionally critical of the pharmaceutical industry, said Pfizers program would offer real life lines to people in need. But he argued that the initiative would help only a small fraction of those in need.

      Hayes said Pfizers discounts show that the drug industry will continue to thrive even with dramatic price cuts and called for giving the federal government negotiating power for the prescription drug benefits under Medicare.

      Pfizer's action gives it a bargaining chip in the Congressional debate on whether to allow reimportation of prescription drugs from Canada and the European Union.

      Kelly said Pfizer's program will provide a safe, secure and sustainable supply of pharmaceuticals in a way no reimportation scheme could.

      The access program, called Pfizer Pfriends, will accept applications starting next month through an 800 number. Once accepted, patients will receive a card they can use at local pharmacies to get discounted Pfizer drugs.

      New York-based Pfizer, the biggest drug company in the world, produces huge-selling medications including Lipitor, the cholesterol drug, the antidepressant Zoloft, the painkiller Celebrex and the blood-pressure drug Norvasc, among others.

      Pfizer Will Offer Deep Discounts to Uninsured...