Current Events in June 2009

June 16, 2009
Starbucks is realling about 530,000 coffee bean grinders sold under the Starbucks Barista and Seattle's Best Coffee brand names.

The grinder can fail to turn off or can turn on unexpectedly, posing a laceration hazard to consumers.

The firm has received 176 reports of grinders that failed to turn off or that turned on unexpectedly, including three reports of hand lacerations that occurred when the grinders turned on unexpectedly during cleaning.

This recall includes the Starbucks Barista Blade Grinders and Seattle's Best Coffee Blade Grinders with the following colors and SKU numbers:

The grinders were sold at Starbucks and Seattle's Best Coffee stores nationwide from March 2002 through March 2009 for about $30. They were made in China.

Consumers should immediately stop using the coffee grinders and contact Starbucks to receive a free replacement grinder.

For additional information, contact Starbucks toll free at (866) 276-2950 between 9 a.m. and 9 p.m. MT or visit the company's Web site at www.starbucks.com

The recall is being conducted in cooperation with the U.S. Consumer Product Safety Commission (CPSC).

Pet owners who were informed of the Food & Drug Administration's (FDA) suspension of Evanger's ability to sell pet food across state lines were relieved — and unsurprised — by the news.

News of the FDA's crackdown confirmed dog owner Leslie K.'s suspicions about Evanger's food — and federal authorities' interest in the company.

"A special agent with the FDA's Office of Criminal Investigations (OCI) called me in May 2009 and wanted details of what happened to my dogs after they ate Evanger's food," the Tabernacle, New Jersey, woman told us. "He came out and said Evanger's failed multiple inspections, and this was not a simple paperwork issue or something to do with an unimportant process. He said it was about ingredients and the manufacturing process and people are not getting what they pay for."

The FDA announced late Friday that it had suspended Evanger's temporary Emergency Permit — a decision that, for now, prevents the company from shipping products in interstate commerce. The agency said it took this action as a safety precaution.

"Evanger's, operating in Wheeling, Illinois, deviated from the prescribed process, equipment, product shipment, and recordkeeping requirements in the production of the company's thermally processed low acid canned food (LACF) products," the FDA said. "The deviations in their processes and documentation could result in under-processed pet foods, which can allow the survival and growth of Clostridium botulinum (C. botulinum), a bacterium that causes botulism in some animals as well as in humans."

Evanger's downplays the FDA's enforcement measures, suggesting the problems are simply a paperwork mix-up.

"In August of 2008, while updating required process information to the FDA our 'process authority' (processing expert) inadvertently deleted pertinent filings," Joel Sher, the company's vice-president, says in a statement on the pet food maker's Web site. "Evanger's has been working with the FDA to resolve this issue quickly. This situation does not call into question the safety of any Evanger's products. No Evanger's product are involved in any recall, nor is there any indication that any Evanger's product is unsafe."

"Just a paperwork problem"

Leslie's concerns with Evanger's food surfaced in May 2007 when three of her healthy dogs — a Chihuahua, Beagle, and Elkhound mix — suddenly became sick after eating the company's Pheasant and Brown Rice dry pet food.

Two other dogs — one belonging to a friend, another to a neighbor — also became ill after eating that same food. All the dogs experienced vomiting, diarrhea, dehydration, and urinary tract problems.

"We bought the food during the pet food recall when we were trying to find a safe food," Leslie recalls. "We opened one large bag and two small bags and started to add it to the dogs' regular food. But they all started having trouble. I spoke to someone who said to stop the food. Four of the dogs then got better."

But Leslie's Chihuahua, Remy, continued to deteriorate.

"He was urinating constantly, vomiting bile, his eyes were sunken from dehydration, and he had horrible lethargy," she said. "He wouldn't get up and do anything. This is a Chihuahua who loved to play. One of my neighbor's came over and said it looked liked Remy had aged ten years."

Blood tests run by Leslie's veterinarian revealed problems with Remy's urine and liver counts. Leslie contacted Evanger's about the dogs' illnesses, but said the company didn't seem concerned.

"The owner said he'd check into this and get back to me. I waited a few days and Joel (Sher, the company's vice-president) called me back. He said the company hadn't found any problems with the food. I asked him if he wanted to test my food, but he said 'No, we keep a sample of every batch so we can test it.'"

"After that call, all I got were answering machines and the secretary."

Leslie then worked with The Pet Food Products Safety Alliance (PFPSA) and had her Evanger's food tested.

Those tests, she says, revealed the copper levels in the food were 2.5 times the amount recommended by the Association of American Feed Control Officials (AAFCO).

When Leslie contacted Evanger's again, "At first, the office manager was nice, but as soon as she knew it was me on the line she became hostile and rude," she said. "She basically said they (Evanger's) were aware of the copper problem and were not concerned. She said they had not tested my food and no intention of doing so because they didn't get that many complaints."

"She knew she went too far because she later sent an e-mail that said the total opposite of what she told me in our conversation."

But could those elevated copper levels cause the dogs' illnesses?

"All my vet can say is the elevated levels (of copper) are consistent with the problems in the dogs: vomiting, diarrhea, lethargy, elevated liver enzymes, and urinary tract problems," Leslie said. "My vet feels it is the food, but says there is no way to prove that."

When asked about Evanger's comment that the FDA's latest action "does not call into question the safety" of any of its products, Leslie told us: "Obviously it does affect the safety of the food because how can the food be safe if the canning isn't done correctly.

"That comment makes me angry," she adds. "He (Joel Sher) tries to refute the FDA orders and notices in legalese. He words it carefully to make it sound like the FDA is wrong. He's trying to make it sound like this is just a paperwork problem. I hope people don't believe it."

"Should be criminally prosecuted"

Deborah V., of Monrovia, Maryland, agrees with Leslie. "People such as the Shers should be criminally prosecuted and put out of business," she said.

"Mr. Sher's callous attitude from day one has been shocking, and yet, here comes our vindication — a little late," she said. "Some people lost their pets to these awful people's food."

"I'm glad this (FDA action) finally happened. I feel relieved that, hopefully, no one else will go through what I have gone through with my dogs."

In Deborah's case, her two healthy 10-pound Pomeranians became gravely ill in November 2008 after sharing a can Evanger's beef chunks.

"Within half an hour, I was rushing to the vet," she recalls. "My dogs were unable to stand, hold up their heads, and they were blind. The vet stabilized them enough to allow me to then drive to the emergency animal clinic, where they were hooked to IVs, and my little guy even had his stomach pumped. He now has seizures, which started in the hospital. He is on a wide variety of meds...and now has a collapsed trachea and [has to use] an endotracheal tube."

Deborah repeatedly contacted Evanger's about her dogs' illnesses, but says the company ignored her concerns. Her roommate finally reached the company's vice-president, Joel Sher.

"And his comment, when told our dogs got sick from their food, was 'Oh, please'. He and his wife are all over the Internet, as well as an employee of theirs, posting information to have you believe they are a very concerned firm. Why not just be upfront? People deserve to know the truth, and I am talking about all of the issues people have had with their food, not just the horror we've gone through and are still going through."

Deborah says her female Pomeranian has improved, "but the little guy will never be 100 percent."

The FDA's latest action against Evanger's is the third in an ongoing series of enforcement proceedings against the pet food maker.

In April 2008, the FDA issued an "Order of Need for Emergency Permit" against Evanger's. That action came after the FDA determined the company had "failed to meet the regulatory requirements to process a product that does not present a health risk."

Two months later the FDA issued a temporary Emergency Permit against Evanger's.

FDA officials said they took that action after inspections of the company between March 2009 and April 2009 determined "Evanger's was not operating in compliance with the mandatory requirements and conditions of the Temporary Emergency Permit."

When the FDA announced its latest enforcement against Evanger's, the agency's Dr. Bernette Dunham said: "The FDA is stopping Evanger's ability to ship pet food in interstate commerce. Today's enforcement action sends a strong message to manufacturers of pet food that we will take whatever action necessary to keep unsafe products from reaching consumers."

Before Evanger's can resume shipping products, the FDA said, it must prove that corrective actions and processing procedures have been made to ensure the company's finished product will not present a health hazard.

Botulism is a toxin that affects the nervous system and can be fatal, the FDA said. Symptoms of botulism in dogs and cat include progressive muscle paralysis, disturbed vision, trouble chewing and swallowing, and progressive weakness to the body. Death is usually caused by paralysis of the heart or the muscles used in breathing.

NUTRO investigated?

Meanwhile, pet owners like Leslie are convinced that Evanger's isn't the only pet food maker on the FDA's radar.

"They have to be investigating NUTRO," she told us. "When I spoke with the FDA's agent from Office of Criminal Investigations, I mentioned NUTRO and he said he was very aware of the problems. But he said 'I'm not working on that case.' He caught himself and said that (investigation) could be in the process. Every time I talked to him, he struggled to find a way to say he was not working on that case, but it seemed to me that he was deliberately trying to give me the impression that there was an investigation of NUTRO.

She adds: "Why else would FDA agents not want to talk about it or the agency wouldn't release the NUTRO records [ConsumerAffairs.Com] requested under the Freedom of Information Act?"

Leslie pointed out that the health problems her dogs suffered after eating Evanger's food with elevated levels of copper — vomiting, diarrhea, lethargy, and elevated liver enzymes — sounded eerily familiar to the ones pets eating NUTRO have experienced.

"I'm seriously thinking that this is what's going on...that this could all be something a simple as the vitamins and minerals off," she says. "That can cause acute illnesses."

Just last month, NUTRO recalled seven flavors of its dry Natural Choice Complete Care and NUTRO Max cat food, saying the products contained incorrect levels of zinc and potassium.

The company blamed the problem on a production error by its U.S. premix supplier, Trouw Nutrition. One of the premixes, NUTRO said, contained excessive levels of zinc and not enough potassium. A second premix did not contain enough potassium.

NUTRO claims it has not received any complaints about the recalled food, but warned cat owners to monitor their pets for such symptoms as vomiting, diarrhea, a reduction in appetite or refusal of food, and weight loss.

ConsumerAffairs.com, however, continues to hear from cat owners who say their felines became ill — with those same types of symptoms — after eating NUTRO's recalled food. Some even suspects their cats' deaths are linked to the recalled food, and two contacted NUTRO regarding their sick pets.

Tests run last August by the PFPSA revealed samples NUTRO's Natural Choice Chicken Meal, Rice, and Oatmeal formula and Nutro Puppy Max contained levels of zinc and copper that the PFPSA said exceeded the recommendations of the AAFCO.

PFPSA's founder Don Earl says NUTRO's cat food recall — trigged by "incorrect levels of zinc and potassium" — gives credence to his organization's test results.

"I feel a certain amount of vindication as a result, particularly as the symptoms are identical to those reported by legions of dog owners," he told us.

ConsumerAffairs.com has received nearly 900 complaints from pet owners nationwide who say their healthy dogs and cats suddenly became sick after eating various flavors of NUTRO's pet food. The pets all have similar symptoms — vomiting, diarrhea, and other digestive problems. And in nearly every case, the dogs and cat became better after their owners stopped feeding them NUTRO.

NUTRO maintains its food is 100 percent safe and meets all federal guidelines. But Leslie says those are nothing but empty words and promises.

"The fact they keep saying nothing is wrong with their food and they are testing tells me that something is wrong. If they were testing the food, it wouldn't take an audit to find the problem. If they were testing the food, they would know that something is wrong."

The active poster on many pet-related message boards adds: "I'm not in this to get any money. That's not my point. My point is that whether you're buying Evanger's or NUTRO or a store brand of pet food, you should be able to buy a product that is safe and doesn't make your pets sick."

In the early part of this decade, physicians — at the urging of drug maker Eli Lilly — prescribed Zyprexa for elderly patients with dementia. But the drug was not approved to treat dementia and was ineffective, and Lilly apparently knew that, some health insurers claim.

Unsealed company documents reveal Lillys marketing campaign for the drug, originally approved for use as an anti-psychotic. The documents have been presented as evidence in litigation against Lilly for overpayment.

One such document summarizes a 1995 company study showing that Zyprexa "did not show efficacy" in treating behavioral disturbances in elderly patients who were suffering from dementia.

Last year Zyprexa was Eli Lillys best-selling medication, bringing in more than $4.7 billion in sales. But while some doctors were apparently prescribing it for patients suffering from dementia, the company told the Food and Drug Administration in late 2003 that data from a number of studies failed to show Zyprexa was helpful for patients suffering from Alzheimers disease or other forms of dementia.

Eli Lilly entered a guilty plea earlier this year to illegally marketing Zyprexa for off-label purposes to elderly consumers. But the company says that occurred only during a narrow window of time -- from late 1999 through early 2001.

A company spokesman said the plaintiffs have released "one-sided, cherry-picked" documents that do not tell the whole story, and that Lilly will contest the charges in court.

The released documents also allege that Eli Lilly produced a number of articles about Zyprexa, showing the drug in a positive light, and asked doctors to submit them to medical journals as their own work. The documents also allege that Lilly assembled a guide to selecting scientists who would write favorable articles.

The documents saw the light of day only because of suits against the drug marker brought by health insurers and pension plans. These plaintiffs are seeking to recoup the money spent on Zyprexa to treat elderly policy holders with dementia.

The plaintiffs also demand that Lilly pay $6.8 billion in damages for soft-peddling Zyprexas health risks and marketing it for unapproved uses.

In January Eli Lilly settled with the U.S. Government and a number of states, paying $1.42 billion to resolve off-label marketing allegations. The company has paid out $1.2 billion so far to settle more than 30,000 individual consumer claims, according to a company document.

Zyprexa has produced a number of complaints to Consumeraffairs.com, but mostly about side effects.

"I ... took Zyprexa and it was a nightmare; gained a lot of weight; sleepless nights among other side effects," Denise, of Fresno, Calif., said.

Linda, of Vallejo, Calif., said she took Zyprexa for depression, but the side effects were worse.

"Caused severe weight gain, serious insomnia that could not be helped with medication. A kind of 'zombie' feeling during the day," she said. "It caused my children and friends to question my ability to think for myself. It made the depression worse."

A number of lawsuits regarding defective Chinese-manufactured drywall have been consolidated and will be heard by a federal judge in New Orleans, the city whose post-Katrina construction boom is partly to blame for the issue.

The Judicial Panel on Multidistrict Litgation (JPML) has assigned the newly-consolidated action to Judge Eldon Fallon.

Florida-based attorneys had argued that the proceeding should be heard in Miami, since most complaints had emanated from there. Additionally, more lawsuits have been filed in Florida than in any other state. Attorneys in Ohio also argued that their state was the best candidate.

The JPML, made up of seven sitting federal judges appointed by the Chief Justice of the Supreme Court, determines whether two or more lawsuits involve common questions of fact. If the panel makes such a finding, it consolidates the cases and assigns them to a court and judge. Suits alleging mass-tort claims, like the drywall action, are prime contenders for consolidation.

The issue is also receiving attention from Congress, although funding is currently being held up in the House. In May, the Senate Subcommittee on Consumer Protection approved $2 million for the Consumer Product Safety Commission (CPSC) to study the cause and effects of the drywall defects, but the House has yet to ratify the funds. South Florida Reps. Robert Wexler, a Democrat, and Mario Diaz-Balart, a Republican, are fighting to approve the funding. Bill Nelson, Florida's Democratic senior senator, has led the charge in the upper chamber.

Local municipalities are also taking the matter into their own hands. In May, the Norfolk, Virginia city council unanimously approved a measure banning the use of all Chinese drywall in the city.

Approximately 550 million pounds of the drywall were imported into the U.S. between 2004 and 2006. The relatively cheap wallboard was welcomed by homebuilders, who were suffering supply shortages due to the housing boom and construction in the wake of Hurricanes Katrina and Rita.

The bulk of the drywall appears to have been manufactured by Knauf Plasterboard Tianjin Co. (KPT), although other manufacturers may also be to blame. KPT prints its name on the back of its drywall, making it the most easily identifiable culprit — and consequently the most frequently named defendant.

Lennar Homes, the country's second-largest homebuilder, opened itself to liability when it confirmed that it used KPT in some of its houses. Lennar says it is taking steps to remedy the problem.

The drywall poses risks to both property values and homeowners' health. The wallboard emits an egg-like sulfur smell, which corrodes metal fixtures like air conditioners, and causes health problems ranging from coughing and wheezing to asthma and pneumonia.

In addition to Florida and Louisiana, suits have been filed in Virginia, Ohio, Mississippi, and North Carolina.

The restaurant industry is now on board along with health groups in supporting legislation that would require calories on chain restaurant menus and menu boards.

Besides requiring calories on menus, menu boards and drive-through displays, the new legislation would require chains with 20 or more outlets to provide additional nutrition information upon request.

That language is included among other prevention measures in the draft health reform legislation released by the Senate Health, Education, Labor and Pensions (HELP) Committee.

Senator Tom Harkin (D-IA), the lead sponsor of the Menu Education and Labeling (MEAL) Act, brokered the agreement with Senators Tom Carper (D-DE) and Lisa Murkowski (R-AK), sponsors of a separate bill backed by.

Not only does menu legislation have backing from both Republicans and Democrats in Congress, consumer and industry groups appear to be on the same page as well. The measure has garnered the support of both the Center for Science in the Public Interest, a fierce food industry critic, and the National Restaurant Association.

"We know the importance of providing consumers with the information they want and need in a consistent format no matter where they are across the country," said Dawn Sweeney, President and CEO of the NAR. "This legislation would replace varying state and local ordinances with a national standard that empowers consumers to make choices that are best for themselves and their families."

"Calories on menus will allow Americans to exercise responsibility for what they eat and what they order for their children," said Center for Science in the Public Interest nutrition policy director Margo G. Wootan. "Whether you're concerned about managing your weight or about getting your money's worth at chain restaurants, calorie counts are critical pieces of information. We're delighted to be working with the restaurant industry on legislation that will ensure that calories be listed on their menus and menu boards."

If enacted, the compromise bill would cover all chains of 20 or more restaurants; small businesses would be exempt. Custom orders and temporary specials would be exempt from the calorie labeling requirement, as would items not listed on menus or menu boards, such as condiments.

Like the Nutrition Labeling and Education Act that requires Nutrition Facts labeling on packaged foods, the legislation would require national uniformity.

Similar bills or regulations have been adopted in New York City, Philadelphia, Massachusetts, California and a number of major counties. This month bills in Oregon, Maine and Connecticut passed their state legislatures and are awaiting final action.

Eighty-two percent of those surveyed in New York City after its calorie-labeling rule went into effect said seeing calories on menus affected their choices. And Starbucks, Cosi and other restaurants have reformulated menu items to bring down the calories.

CSPI pointed out that companies are required to provide information on the fuel-efficiency of cars, care instructions for clothing, and energy and water consumption of certain home appliances.

"It seems more important that people be able to watch their calorie intake to avoid diabetes or heart disease than to know how to wash a blouse," said Wootan. "Putting calories on menu boards is a common-sense prevention measure that will help reduce Americans' risk of heart disease, diabetes and other expensive-to-treat chronic diseases made more prevalent by rising obesity rates."

American adults and children consume — on average — one third of their calories from eating out. Studies link eating out with obesity and higher caloric intakes. For example, children eat almost twice as many calories when they eat a meal at a restaurant compared to a meal at home.

Meals at chain restaurants can be unexpectedly high in calories, with appetizers, entres and desserts sometimes providing an entire day's worth of calories on a single plate.

The recording industry, which has been suing hundreds of consumers for copyright infringement, is getting a sample of the flip side. A New Jersey woman has countersued the big record labels, charging them with extortion and violations of the federal antiracketeering act.

Michele Scimeca sued the Recording Industry Association of America (RIAA), charging that by suing file-swappers for copyright infringement and then offering to settle instead of pursuing the case, the RIAA is violating the anti-racketeering statues, which are normally applied to gangsters and organized crime.

"This scare tactic has caused a vast amount of settlements from individuals who feared fighting such a large institution and feel victim to these actions and felt forced to provide funds to settle these actions instead of fighting," Scimeca's attorney, Bart Lombardo, wrote in documents filed with a New Jersey federal court. "These types of scare tactics are not permissible and amount to extortion."

The RIAA has been suing ordinary consumers for hundreds of thousands of dollars, accusing them of infringing the recording companies' copyrights by sharing music files over the Internet. It filed its latest batch of suits, against 531 people, last week. A total of nearly 1,500 have been sued so far. About 380 have settled out of court, usually by paying thousands of dollars.

In San Francisco, computer user Raymond Maalouf is preparing to fight back. His daughters allegedly used Kazaa to download music.

In court documents, Maalouf's attorneys noted that downloading through Kazaa was openly discussed at Maalouf's daughter's school by teachers, and they downloaded songs used in classes. That should be a protected fair use of the music, the attorneys said.

At least one Canadian schemer selling unauthorized listings and advertisements in non-existent business and travel directories to U.S. businesses has been brought to justice.

The U.S. Federal Trade Commission (FTC) says it has obtained a $2 million summary judgment against an Ontario-based operation that, it says, defrauded U.S. businesses out of millions of dollars.

According to the FTC's complaint filed in October 2006, four defendants in Ontario operated a scheme that targeted businesses and municipalities in the United States, and a related scheme aimed at hotels and resorts in this country and more than 25 others.

The court order requires Michael Robert Petreikis to pay $2 million in redress for victims and bans him from marketing or selling business or travel directories and listings. The order also bars him from misrepresenting that consumers have a preexisting business relationship or that consumers purchased, have agreed to purchase, or owe money for business or travel directory ads or listings, office supplies, or consulting services.

In addition, Petreikis is prohibited from collecting payments on any invoices the defendants sent prior to the court order, and from disclosing or benefiting from personal information obtained as a result of activities alleged in the FTC's complaint. The order also contains record-keeping and reporting provisions to allow the FTC to monitor compliance with the order.

The FTC investigated this case with the assistance of the Toronto Strategic Partnership, which, in addition to the FTC, includes the Toronto Police Service Fraud Squad, Telemarketing Section; the Ontario Provincial Police, Anti-Rackets Section; the Ontario Ministry of Government Services; Canadas Competition Bureau; the Royal Canadian Mounted Police; the U.S. Postal Inspection Service; and the United Kingdoms Office of Fair Trading.

While government martinets congratulated themselves and network anchors pompously proclaimed themselves "all-digital," millions of taxpayers fumed as the 60-year era of high-powered, free, over-the-air television faded abruptly to black or, in some cases, broke up into tiny digital fractals.

"Since the digital change I have lost all Cincinnati TV stations," wrote Jerry of Rochester, Ohio. "I can no longer get my local news or traffic reports. I do get Dayton news but what for -- I have never even been to Dayton nor do I plan to go."

"Currently, I don't have any digital signals," said Penny of Roselle, N.J. "No New York mainstays, like 2, 4, 5, 7, 9, 11, 13, 31 like before. Moving the antenna doesn't help. Basically, I just don't use it. Why bother?"

"Things went about as smoothly as we could have hoped," said FCC Commissioner Jonathan Adelstein. "It's looking more like Y2K than the Bay of Pigs. Certainly, if we had not delayed and prepared, it might have been a disaster. But with the additional time, resources and actual planning, we put things in order just in time."

Tell that to Jim of Minneapolis.

"Digital TV is pathetic," he complained to ConsumerAffairs.com. "I no longer receive major channels. What does come in is OK. I now get channel 2 four times. (yipee)"

Not since the 1950s have so many tried so hard to get a simple over-the-air television signal. That didn't stop the Federal Communications Commission (FCC) from saying there had been "few major problems" while in the same breath saying it had received nearly 800,000 calls from citizens complaining they had lost their free TV signals as the nation's television broadcasters switched to digital transmission on a different set of frequencies than those that have been in use since the early days of commercial television.

According to the FCC's report, the largest volume of calls per TV household among markets registering 1,000 or more calls came from the Chicago media market, followed by the Dallas-Ft. Worth, New York, Philadelphia, and Baltimore markets.

What's the frequency, Kenneth?

While the focus has been largely on the analog-to-digital transition, the change in frequency bands is a more significant contributor to the problem. And why did all those broadcasters have to move? Because the federal government auctioned off the frequencies formerly used by VHF broadcasters for several billion dollars a few years ago, that's why.

The change is being hailed by silver-tongued government spinmeisters as a great leap forward for average American couch potatoes. But what has gone largely unnoticed is that the same demographic changes that have killed afternoon newspapers and clogged freeways -- namely, urban sprawl -- have also greatly increased the geographic size of local TV markets.

As New Yorkers, Dallasites and Chicagoans have moved ever farther from the city center, their distance from the TV transmitters -- typically located atop such structures as the Empire State Building and the Sears Tower -- has increased.

The unfortunate truth is that the new frequency band assigned to television broadcasters simply doesn't have the -- to use a technical term -- oomph that the old one did. And therefore, those in the far reaches of suburbia are suddenly finding they can't get a decent signal.

The problem, though, is not confined to the burbs. Many close-in urban dwellers have for years been able to get by with a set of "rabbit ears," inside antennas that can pull in a strong local signal. But the new frequencies don't penetrate buildings as well as the old ones, so the rabbit ears no longer "hear" anything.

In many urban areas, it's impossible to erect an outdoor antenna. Multi-story buildings generally don't allow it and, in the suburbs, clipboard-toting homeowners association enforcers stand ready to persecute, and even prosecute, those who dare to put an antenna on their house or condo.

The end result is that, for many Americans, free TV is no longer an option. To continue watching local stations, they'll need to subscribe to cable or satellite services.

Government and big media, of course, generally blame the victims for the failure of huge public programs. And so, FCC spokesmen and such outlets as The Wall Street Journal put the onus for signal loss on consumers. "Shift to Digital TV sends Late Adapters Scrambling," sniffed the Journal.

But in fact, many of those who today are left to reacquaint themselves with the Great Books did everything their fumbling government told them to do, hoping to be ready when the switch occurred.

"I did everything the government said to do," said Ann of Annapolis, Md. "Got a new antenna, bought a converter box and the result? I used to get 14 stations from both Washington and Baltimore and now I get 1 station. One. I have rescanned repeatedly, all day. Moved the antenna around inch by inch in a complete circle and still I get 1 station."

"All the info that is thrown to us from the stations and the government are lies. There is no better reception, there are no 'extra' channels, there is no easy fix. These are just lies. There are far less channels, and reception is just awful if you don't live right under the station's antenna (like I do for the 1 channel I can still get)."

"Truly historic"

Government policymakers declared victory and withdrew.

"Yesterday was a truly historic day," said acting FCC chairman Michael Copps. "For TV broadcasting, it was a final farewell to the Dinosaur Age and the dawn of the Digital Age. We said goodbye to the analog transmission technology that has served us well for the past 60 years and replaced it with something that can serve us even better."

Copps might want to talk to Penny of New Jersey, who has given up on over-the-air TV. Her solution to the government-inflicted problem: "I watch old VCR tapes and DVDs. Or internet TV (which is the only bright spot in this wretched transition)."

By Mark Huffman
ConsumerAffairs.com

June 13, 2009
Congressional leaders have given a big push to the "cash for clunkers" program that would pay consumers up to $4,500 for trading in old gas guzzlers for new cars, attaching the legislation to a must-pass bill that will fund troops in Iraq and Afghanistan.

Voting could take place next week but passage is almost assured and President Obama, a strong supporter, is almost certain to sign the bill, which lawmakers hope will stop a steep slide in new-car sales. Now that taxpayers have paid billions to prop up Chrysler and GM, there's growing concern that suddenly thrifty consumers simply will choose to keep their old cars on the road instead of ponying up for new ones.

The measure would subsidize the purchase of up to one million vehicles. The current price tag on the bill is $1 billion. The program would end when the money ran out.

The bill would require that trade-ins get no better than 18 miles per gallon, be a 1984 or newer model, and have been registered and insured during the past year. The last provision is intended to keep quick-buck artists from flooding the program with junkers scavenged from used car lots.

If consumers purchased a new vehicle that gets an extra four miles per gallon or more, they would receive a voucher for $3,500. If they purchased a new vehicle that gets 10 miles per gallon or more than their trade-in, the value of the voucher goes up to $4500.

Critics object

Is it worth it? Not everyone thinks so.

Republicans say the program would cost too much and accomplish too little.

Perhaps surprisingly, some environmentalists are also critical. These critics, inclduing Sen. Dianne Feinstein (D-Calif.), say the measure is not strict enough in its mileage requirements and could, under some circumstances, subsidize the purchase of gas-guzzling SUVs.

"It is amazing how quickly a good idea can go bad in Washington," said Feinstein and Sen. Susan Collins (R-Maine) in an opinion article in the Wall Street Journal, headlined: "Handouts for Hummers."

Auto industry analysts say the plan, if implemented, could stimulate new vehicle sales beginning as early as August. Since many of the "clunkers" are in the truck category, they say the plan would likely have the most impact on U.S. truck sales.

June 12, 2009
It seems pretty simple; if you sell consumers a vacation package, you'd better be able to deliver what the vacationers have paid for.

In New Jersey the state attorney general has filed suit in state Superior Court against travel club companies operating under several different names and their principal, charging that they failed to provide any services to consumers and misrepresented their relationship with hotel, airline and car rental companies through the unauthorized use of their corporate logos.

Defendants Dreamworks Vacation Club, Five Points Travel Company and Bentley Travel are accused of depicting specific resorts, regions and packages in mailings and sales presentations that, in actuality, were not available to consumers. Defendant Daryl T. Turner is the owner and operator of these companies. The investigation that led to the States action began with the Burlington County Consumer Affairs Local Assistance office, and was referred to the Division of Consumer Affairs for joint investigation.

Burlington County CALA Director Renee L. Borstad joined with New Jersey Consumer Affairs Director David Szuchman to announce the lawsuit at a press conference at the Division's South Jersey office in Cherry Hill.

"We believe the defendants had no intention of providing the advertised travel services. They lured consumers in with promises of deep discounts, free gifts and misrepresentations about their affiliation with respected corporations, all for the purposes of defrauding consumers and enriching themselves," said New Jersey Consumer Affairs Director David Szuchman.

"Dreamworks and its other vacation clubs offered a 'dream' vacation that was too good to be true. Consumers must realize that high-pressure sales tactics, coupled with prepaid vacation packages, plus freebee airline ticket offers are always a dangerous combination," said Burlington County CALA Director Renee L. Borstad.

"In addition to not providing the contracted-for travel packages, the defendants also did not provide the free gifts that consumers were led to believe they would receive, including seven-day cruises, round-trip airline tickets for two, hotel stays, free dinners, car rentals and/or free gas coupons. When consumers contacted the "800" telephone number listed on the mailings to claim their gifts, they were informed that they had to attend a 90-minute sales presentation for vacation packages. Even if they attended the presentations, consumers were not provided with the gifts.

Consumers paid $1,200 to $8,000 upfront to purchase a vacation package, but were not provided with the airline, hotel or other travel arrangements at the price and quality represented by defendants prior to purchase.

Dreamworks and Five Points Travel Company have business and mailing addresses in Parsippany, Morris County; Sewell, Gloucester County; and Westampton, Burlington County. Bentley Travel is not incorporated to do business in New Jersey. Turner's address of record is in Cherry Hill, Camden County.

The state's eight-count Complaint, filed in New Jersey Superior Court in Morris County, alleges that the defendants violated the Consumer Fraud Act and Advertising Regulations by:

• Utilizing the terms "Bailout", "Division of Revenue" and "Department of Funding" on mailings sent to consumers to falsely imply that the mailing originated from a state or federal government agency or department;

• In mail solicitations and other advertising materials, utilizing without authorization, the trademarks of airlines, hotels, car rental companies and restaurants;

• Forwarding mailings to consumers which indicated that consumers were entitled to complimentary gifts, when receipt of such gifts were conditioned upon attendance at a sales presentation for vacation packages;

• During sales presentations, inducing consumers to purchase vacation packages by showing them brochures with resort areas and packages that were not available;

• Advising consumers prior to purchase that they have the right to cancel the contract if they were not satisfied with the vacation package, and then refusing to permit the consumers to cancel the contract;

• Charging consumers' credit cards for fees and services that were not authorized by the consumers;

• Submitting bills to collection agencies after consumers have cancelled the contract and formally disputed the charges;

• Representing to consumers that they were members of the Better Business Bureau ("BBB") in good standing, when such was not the case;

• Failing to disclose to consumers prior to their purchase of a vacation package that they would be required to pay additional fees prior to utilizing the service;

• Requiring consumers to sign incomplete or blank sales contracts for vacation packages and then failing to provide consumers with full and accurate copies of such contracts;

• Failing to include in the contract a statement advising consumers of their right to cancel prior to the midnight of the third business day after execution of the contract.

To date, the state said it has received complaints from 198 consumers against the defendants either directly or from the Burlington County CALA Office. The state's lawsuit seeks injunctive and other relief, maximum civil penalties, consumer restitution and reimbursement of the states legal fees and investigative costs.

More Scam Alerts ...

The U.S. Food and Drug Administration announced today it was suspending Evanger's Dog & Cat Food Co.'s emergency permit to ship pet food because the company's procedures could allow the bacterium that causes botulism to survive in some of its products.

The FDA is stopping Evanger's ability to ship pet food in interstate commerce, said Dr. Bernadette Dunham. Todays enforcement action sends a strong message to manufacturers of pet food that we will take whatever action necessary to keep unsafe products from reaching consumers.

Botulism is a powerful toxin that affects the nervous system and can be fatal. The disease has been documented in dogs and cats. Signs of botulism in animals are progressive muscle paralysis, disturbed vision, difficulty in chewing and swallowing, and progressive weakness to the body. Death is usually due to paralysis of the heart or the muscles used in breathing.

The symptoms fit those described by consumers who complained to ConsumerAffairs.com. In December 2008, Chris of Monrovia, Md., described what happened when she fed her two Pomeranians some Evanger's Beef Chunks in Gracy.

"Within 45 minutes they were both in critical condition with signs of complete neurological shutdown, blindness, inability to stand or walk, difficulty breathing and swallowing," she said. "Both dogs were treated for symptoms of botulism and the food was to be sent out for testing through Greenbriar Emergency Hospital."

And how did Evanger's react to the near-disaster?

"When I called the office number listed on Evanger's Web site on November 19th, I was hung up on. When Dr. Rossi called Evanger's on November 20th, she was told by the person who answered that they would not speak another word to her because she could not prove she even was a vet," Chris said.

Earlier FDA action

In April 2008, Evangers was issued an Order of Need for Emergency Permit after the FDA determined that the company had failed to meet the regulatory requirements to process a product that does not present a health risk.

In June, 2008, FDA issued Evangers a temporary Emergency Permit. During inspections conducted between March 2009 and April 2009, the FDA said it determined that Evangers was not operating in compliance with the mandatory requirements and conditions of the Temporary Emergency Permit.

In order for Evanger's to resume shipping in interstate commerce, the company must document that corrective actions and processing procedures have been implemented to ensure that the finished product will not present a health hazard.

The FDA said that Evanger's, operating in Wheeling, Illinois, "deviated from the prescribed process, equipment, product shipment, and recordkeeping requirements in the production of the company's thermally processed low acid canned food (LACF) products" and that under-processed pet food could be the result.

While FDAs Center for Food Safety and Applied Nutrition is responsible for regulating all human and animal LACF processing, FDA's Center for Veterinary Medicine has authority over animal feed and foods. The two centers are collaborating on the Evanger's enforcement action, the agency said.

A New York man has filed a class action lawsuit against popular dating site Match.com, claiming that the site deceives subscribers by showing them photos and profiles of non-paying members who can't respond to romantic advances.

Match.com allows anyone to create a profile for free, but in order to read or respond to messages, or contact potential partners, customers must sign up for a subscription with the website.

Sean McGinn, of Brooklyn, NY, alleges that this practice caused him "humiliation and disappointment" when he tried to contact non-subscribing members and never heard back from them. McGinn apparently took this to mean that his efforts had failed, when in fact his romantic interests were unable to read, let alone reply to, his messages without subscribing or re-activating an expired account. (Match.com doesn't delete profiles of members who have canceled their accounts or let them expire, further defrauding bachelors like McGinn.)

According to McGinn, the user agreement he signed when he created his account never warned him that not every profile is that of a bona fide member. McGinn asserts that Match.com "defrauds the consumer of his/her time and personal investment every time a person pays Match's subscription fee and writes to a member who wont have the ability to read what they wrote or see their profile."

McGinn, already uncomfortable with dating, has been further traumatized by his online experience. His suit says that "despite the emotional vulnerability inherent in the dating process, fraught as it is with fear of rejection and anxiety, Match defrauds the consumer of his/her time, labor, and emotional investment" by failing to inform them that non-subscribing members cannot reciprocate their sweet nothings.

McGinn's attorney, Norah Hart of Treuhaft & Zakarin, said that affected consumers "are left feeling they've been completely ignored and rejected," and said that the website's practice "could affect their romantic future."

The suit alleges counts under deceptive trade practices; fraud; negligent misrepresentation; and breach of the implied covenant of good faith and fair dealing, which describes a vendor's promise not to break its word or deny terms that were obviously implied or read into the contract. Although McGinn has not specified the exact amount of money he is seeking, his attorneys expect the damages to be at least $5 million.

This isn't the first time that Match.com has been accused of using fraudulent practices to lure lonely souls to its homepage. In November 2005, Matthew Evans of Los Angeles accused the site of creating fake profiles and sending him "winks" from non-existent members to lure him into renewing his subscription. That suit was dismissed in 2007.

Earlier this year, Match.com competitor eHarmony was the target of a class action based on its strident anti-gay discrimination. The suit stemmed from an earlier action citing eHarmony's refusal to add "man seeking man" or "woman seeking woman" to its menu of choices. The latest claim accuses eHarmony of employing a "separate but equal" approach by creating an entirely new site — CompatiblePartners.com — rather than modifying the existing eHarmony site.

Online dating has become enormously popular over the past few years. It is estimated that over 20 million people visit an online dating service every month, and in 2006, fully 31 percent of Americans said they knew someone who had used an online dating service. A 2004 report found that internet dating sites had collected a total of $473 million in advertising revenues.

Match.com, based in Dallas, has vowed that they will "defend [the suit] vigorously."

More about online dating ...

June 10, 2009
Smaller Internet publishers converged on Washington, D.C., this week, aiming to demonstrate to Congress the importance of the advertising-supported Internet as a free information source for consumers and as a creator of jobs and economic growth for the U.S. economy.

"Advertising-supported Internet sites empower consumers in ways no one would have dreamed possible just a few decades ago," said James R. Hood, president and editor in chief of ConsumerAffairs.com. "Hundreds of thousands of sites provide every imaginable information, opinion and entertainment option, while supporting their local economies by providing jobs, paying taxes and helping consumers make better, more informed decisions."

Hood was one of 30 smaller online publishers from across the country who visited Capitol Hill in a first-of-its-kind event organized by the Interactive Advertising Bureau (IAB).

All of the publishers operate Web sites that provide free content to consumers, supported primarily by advertising.

"Well-meaning consumer and privacy advocates are rightly concerned with protecting consumers' privacy, but Congress must be wary of imposing unrealistic and unnecessary restrictions on the advertising that gives taxpayers unrival access to information," Hood said.

At a press conference at the National Press Club today, the IAB announced news across a number of initiatives from the two-day event:

• The Economic Value of the Advertising-Supported Internet Ecosystem. Commissioned by the IAB and produced by Harvard Business School professors John Deighton and John Quelch, it is the first-ever comprehensive analysis of the economic impact of this ever-more important medium. Among its findings: 2.1%, or $300 billion, of the total U.S. GDP is contributed by the ad-supported Internet, which has created 3.1 million jobs, including 20,000 small businesses.

• Long Tail publishers met with Congress and members of the press to tell their own stories of how they have turned their passions into a medium revolution and into businesses that are helping them and their readers achieve the American dream.

• The formal launch of the IABs Long Tail Alliance, an initiative to give voice through the IAB to smaller ad-supported, publishing and technology sites in the digital ecosystem.

• The debut of I Am the Long Tail, a seven-minute video, created by the IAB, that ties together vignettes from Long Tail publishers across the nation that puts the human face on the Long Tail and is part of a larger effort to collect and share the Long Tail story in video and online at iamthelongtail.com.

We wanted the Long Tail Publishers to use their voices to speak to their Congresspeople about what interactive means to them, their employees and their families. Small businesses have been created and transformed in massive numbers across the U.S. with the advent of the ad-supported Internet. said Randall Rothenberg, President and CEO of IAB.

It is vital that our legislators and regulators, when considering potential regulations, understand that ad-supported publishers are responsible for profound economic value throughout the U.S. Federal and state representatives should not diminish the diversity of voices and ideas in this most diverse of communications media.

"One lawmaker's aide told us that 'saving the newspapers' would be Congress' next job," Hood said. "In fact, journalism is saving itself every day as tens of thousands of small publishers create new content in their various niches. Newspapers are run by adults and can save themselves; they should not become the next ward of the state."

Fremont Investment & Loan and its California-based parent, Fremont General Corporation, have settled predatory lending allegations in Massachusetts. To resolve the Commonwealth's lawsuit against it, Fremont has agreed to pay the state $10 million in consumer relief, civil penalties and costs.

Fremont has also agreed not to foreclose upon unfair loans without certain protections for borrowers or originate unfair loans in Massachusetts. Those protections against foreclosure, which have been in place since the Superior Court issued a Preliminary Injunction in March 2008 are now permanent and also apply to the loan holders and servicers who acquired the Fremont loans since the injunction issued.

"The American dream of homeownership has turned into a nightmare for many borrowers because of predatory lending practices. We have vigorously sought to hold companies accountable for these practices, and today we have taken another important step toward achieving that goal." said Massachusetts Attorney General Coakley. "With the $10 million we have obtained through this settlement, we have an opportunity to provide consumers and the Commonwealth with additional relief from the predatory lending practices that have besieged our state and nation. We will continue to hold companies responsible for their role in the foreclosure crisis."

Under the terms of the settlement, Fremont has agreed to pay the Commonwealth $10 million, including $8 million in consumer relief, $1 million in civil penalties, and $1 million in costs, including attorneys' fees. The consumer relief funds will be used to redress the negative impact of mortgage foreclosures, predatory lending practices, and to provide relief to Massachusetts borrowers.

Additionally, the settlement makes permanent the terms of the preliminary injunction granted in February 2008. In that preliminary injunction, the Superior Court held that certain Fremont loans were "presumptively unfair" because by their very termsshort term interest rates followed by payment shock, plus high loan-to-value and high debt-to-income ratioswere likely to lead to default and foreclosure.

For those loans, the court established a notice and objection process before Fremont or its assignees or servicers could initiate foreclosures. Under this process the Attorney General's Office receives:

30 days advance notice for loans that are either (1) "not presumptively unfair"; (2) vacant; or (3) not the borrowers' primary residence.

45 days advance notice for loans that are "presumptively unfair."

If the Attorney General's Office objects after initial notice then the parties have 15 days to resolve their dispute. If the dispute remains then Fremont must seek court approval to foreclose. After the notice and objection process, Fremont may only proceed with a foreclosure to which the Attorney General objects if Fremont requests and receives approval from the Superior Court. In considering whether to allow the foreclosure, the court will consider, among other factors, whether the loan is unfair and whether Fremont has taken reasonable steps to work out the loan and avoid foreclosure. Fremont also agreed not to originate unfair loans.

The Attorney General's Office filed suit on October 5, 2007, in Suffolk Superior Court against Fremont and its parent company, Fremont General Corporation based on the defendants' unfair and deceptive loan origination and sales conduct. The complaint specifically alleges that the company was selling risky loan products that it knew was designed to fail, such as 100% financing loans and "no documentation" loans. The complaint further alleged that the company sold these loans through third party brokers and provided financial incentives to these brokers to sell high cost products.

As a result of the lawsuit, up to 2,200 Fremont-originated loans have been protected from unrestricted foreclosures, because the preliminary injunction allowed foreclosures to proceed only after the underlying loan was analyzed for unfair, ultra-risky loan criteria. Although Fremont originated about 15,000 loans in Massachusetts from 2004 through 2007, only 2,200 of those loans remained "live" when the lawsuit commenced. Even though most of the 2,200 loans had been transferred to new holders and servicers, the Superior Courts preliminary injunction required that those holders also were restricted by the court's order.

The House of Representatives has voted to a pass legislation that would pay consumers up to $4500 for trading in old gas-guzzlers for new, more fuel-efficient vehicles.

The measure, designed to both spur auto sales and reduce U.S. fuel consumption, now goes to the Senate. If passed, President Obama is expected to sign it.

Under the so-called "cash for clunkers" bill, a consumer is rewarded for trading in cars that average 18 miles per gallon or less on the combined city/highway cycle. If they purchase a new vehicle that gets an extra four miles per gallon or more, they would receive a voucher for $3,500. If they purchase a new vehicle that gets 10 miles per gallon or more than their "clunker," the value of the voucher goes up to $4500.

Supporters of the plan say there is no way to game the system. It won't apply to prior sales and consumers can't trade in vehicles that haven't been insured in the last year. Also, if the vehicle is more than 25 years old, it doesn't qualify.

The measure passed the house by a 298-119 vote and carries a total price tag of $4 billion. The program would end after one year, or when the money runs out, whichever happens sooner.

Auto industry analysts say the plan, if implemented, could stimulate new vehicle sales beginning as early as August. Since many of the "clunkers" are in the truck category, they say the plan would likely have the most impact on U.S. truck sales.

Can you tell which of these farms produces organic milk?

A U.S. District Court judge in St. Louis has rejected 19 class-action lawsuits filed by consumers who are claiming fraud in the sale of "organic" milk. The suits claimed the milk labeled as organic actually came from large dairy operations that do not meet the federal government's strict rules for organic products.

Consumers in 40 states had brought the lawsuits, alleging fraud in the manufacture of organic milk sold as storebrands in Wal-Mart, Target, Safeway, Costco and other national chains served by Aurora Dairy. Lawyers for the plaintiffs said that a 2007 federal investigation found the Aurora Dairy had "willfully" violated 14 different federal organic regulations.

The Cornucopia Institute, a Wisconsin-based group promoting small-scale farming, says a handful of large dairy operations like Aurora are making a difficult time in the organic industry much worse. By skirting strict federal regulations and creating a surplus of what the group calls "phony" organic milk, they are flooding the market and driving prices so low than small organic producers who follow the rules are being driven out of business.

The Cornucopia Institute estimates that as much as 30-40 percent of milk labeled as organic is now coming from giant industrial operations, milking as many as 7000 cows each.

Lawyers representing consumers involved with the class-action lawsuits vow that they will appeal the judges initial ruling, especially in light of a recent Supreme Court decision that clearly gives citizens the right to sue corporations that allegedly act illegally even though federal regulatory agencies provide statutory authority over certain industries.

According to Mark Kastel, the Senior Farm Policy Analyst for The Cornucopia Institute, the dismissal was a huge setback "because Bush Administration officials had substantially softened USDA penalties recommended by enforcement staff for Auroras organic transgressions." Cornucopia said it first alerted the USDA to Aurora's violations by filing formal legal complaints with the agency.

"The very essence of the checks and balances system in our three branches of government provides for citizens to seek remedy, when regulatory agencies fail to enforce laws passed by Congress," said Gary Cox, a Columbus, Ohio-based attorney with experience in the organic industry. "It is our contention that a judicial review of the alleged misconduct by these giant corporations, and the lack of enforcement by the USDA, is not only appropriate but imperative."

The outcome of the pending suits will not only impact consumers but many organic dairy farmers whose livelihoods are now threatened by the giant corporate dairy marketers.

Meanwhile, there's a glut of organic milk on the market, meaning dairy processors who package and distribute organic products are reducing supplies and cutting the prices they pay to farmers. Dean Foods, the nation's largest milk processor, and owner of the Horizon Organic brand, and H. P. Hood, a giant Boston-based milk bottler, that controls the Stonyfield milk label, have both terminated contracts with farmers Cornucopia alleges.

"I have invested my life in building this dairy farm, and Hood encouraged many dairy producers to make major investments and ramp-up for organic production, now my entire livelihood and the financial future of my family is at risk," said Kevin Poetker who milks 200 cows near Waterloo, IL, near St. Louis.

Cornucopia is organizing an effort to pressure the Obama Administration to take a different tack on the issue than its predecessor. The groups says thousands of letters, mostly from organic farmers, have been sent to President Obama and USDA secretary Tom Vilsack asking them to immediately intervene and undertake aggressive enforcement of organic regulations.

June 9, 2009
Consumers fell behind on their credit card payments as the recession deepened in the first quarter of the year. For the first three months of 2009, 1.32 percent of consumers were three or more months behind on their credit card payments, up 11 percent over the same period in 2008, according to Trans Union, a credit reporting agency.

Information for the analysis is culled quarterly from approximately 27 million anonymous, individual credit files, providing a perspective on how U.S. consumers are managing their credit health.

Average bankcard borrower debt, defined as the aggregate balance on all bank-issued credit cards for an individual bankcard borrower, inched upward nationally 0.82 percent to $5,776 from the previous quarter's $5,729, and 4.09 percent compared to the first quarter of 2008. The highest state average bankcard debt remains in Alaska at $7,476, followed by Tennessee at $6,869 and Nevada at $6,677.

The lowest average bankcard debt was found in Iowa, at $4,300, followed by North Dakota with $4,414 and West Virginia with $4,640.

The steepest increases in average bankcard debt over the previous quarter occurred in Alabama , Mississippi and Tennessee. The District of Columbia experienced the largest drop in average bankcard debt, followed by the Wyoming and New Jersey.

"As expected, bankcard delinquencies increased in the first quarter both as a national average and in most areas of the country," said Ezra Becker, director of consulting and strategy in TransUnion's financial services group.

"As the recession entered its sixth quarter, we saw continued increases in average bankcard balances, as consumers struggled to meet repayment obligations in a job market that continues to deteriorate. This increase could be an indication that tax refund checks, typically used to pay down balances in during the first quarter in years past, are now being used to cover daily living expenses."

At end of the 2001 recession, the national bankcard delinquency rate had increased to a high of 1.69 percent, and as that recession came to a close in November of 2001, three of the five riskiest areas of the country in terms of bankcard delinquency were to be found in the South: North Carolina, Georgia, and South Carolina. In the current recession, Las Vegas, NV is leading in terms of bankcard delinquency, followed closely by Florida and California metros. Not surprisingly, all three states have led the nation in home foreclosures as well.

This highlights one of the fundamental differences between the two recessions -- the housing market, Becker said. Today, the least risky metropolitan area is Bismarck, N.D., with a credit card delinquency rate of 0.6 percent -- a position fairly consistent with what it held during the previous recession."

Angry consumers have filed a class action against Wal-Mart, alleging that refunds from the leading retailer don't include the full amount paid in sales tax.

Lead plaintiff John Whitwell of Maryville, IL, bought a Blu-ray disc machine at a Wal-Mart store in Collinsville, IL, for a total of $214.04; he later returned it to a store in Glen Carbon, IL and only received $211.56 back.

The $2.48 difference is explained by the fact that Glen Carbon has a lower sales tax than does Collinsville. According to the complaint, "Upon information and belief Wal-Mart returned the lesser amount because the applicable tax rate at the Glen Carbon, Illinois store is 6.85 percent," lower than the 8.1 percent rate in Collinsville.

The complaint alleges that Wal-Mart's failure to provide a full refund including sales tax is a breach of contract, since Wal-Mart promises a "refund of all amounts paid by the purchaser if merchandise is returned to it within the prescribed time period." Wal-Mart cannot duck this obligation by making an exception when items are bought at one store and then returned to a different location.

Wal-Mart also refuses to follow the practice when the situation is reversed; if an item is returned to a store with a higher sales tax than the one at which it was purchased, Wal-Mart won't provide the additional tax money with the refund.

This isn't the first time that Wal-Mart's sales tax practices have raised eyebrows. Last October, Connecticut Attorney General Richard Blumenthal probed complaints that the chain charged a second sales tax when merchandise paid for in cash was exchanged. After the investigation became public, Wal-Mart spokesman Dan Fogelman was infamously paraphrased as saying that "although [Fogelman] has no idea what Connecticut state tax law is, his company is following it." His replacement, Ashley Hardie, was subsequently forced to issue a more convincing statement, promising that Wal-Mart had "taken steps to ensure that our associates are fully complying with Connecticut law when processing even exchanges."

The suit is being brought on behalf of "[a]ll persons in the United States who returned merchandise to Wal Mart after May 14, 1999, and received a refund of sales tax in an amount less than the sales tax originally paid for the returned merchandise." More than 50 consumers nationwide have joined the suit. The action, filed in state court in Madison County, IL, is being prosecuted by the law firm of LakinChapman in Wood River, IL.

Wal-Mart, the world's largest corporation by revenue, has been the biggest American retail beneficiary of the lagging economy, due to its low prices and countless locations. The chain is also currently facing a gender-discrimination suit, which claims that Wal-Mart unfairly discriminated against females when considering pay and promotions. That class, if ultimately certified, would constitute the largest gender-discrimination suit in history, covering 1.5 million women.

Government involvement in Chrysler and General Motors operations may coincide with a new emphasis on small, fuel-efficient cars. The American taxpayers, who start off owning a big chunk of the bankrupt automakers, better hope consumers warm up to the idea of green cars. But so far, they havent.

Toyota reports U.S. sales of its Prius hybrid are down a whopping 45 percent so far in 2009. Its a far cry from this time last year, when Toyota dealers were tacking on a premium to the sticker price and had waiting lists for the cars.

Toyota says it has sold just 42,743 Prius models through the first five months of 2009, compared to 79,675 during the same period last year.

Why have American consumers fallen out of love with the Prius? Gasoline prices may have something to do with it.

At this time last year gasoline prices were about a $1.50 a gallon more than they are now, costing consumers an extra $30 per fill-up if they were driving a vehicle holding 20 or more gallons. It suggests consumers flocked to the Prius, not because its cute or they want to save the planet, but because they wanted to save money on fuel.

Gas prices may not be the only factor.

In a recession, consumers are buying fewer new cars altogether, and when they do make a purchase, are looking for the best deal possible. The Prius -- especially with the surcharge tacked on by dealers last year -- is more expensive than other small cars.

The Prius remains a top-selling model in Japan. In fact, it was the best-selling car in Japan during May, according to the Japan Automobile Dealers Association. Of course, gasoline prices are much higher in Japan than they are in the U.S.