Despite its recent agreement to pay more than $21 million in a class-action lawsuit, Publishers Clearing House is still in hot water in at least 30 states.
The states' Attorneys General are suing PCH alleging that its sweepstakes promotions use false and misleading tactics to peddle magazine subscriptions.
Virginia filed against the company yesterday, charging that it tricks consumers into buying more and more magazine subscriptions in the hope that this will increase their chances of winning the sweepstakes.
"For a small group of citizens, many of them elderly, the effect is devastating," the Virginia suit charged. It said that Virginians bought $1.5 million worth of subscriptions in 1997 and that 426 of them spent more than $2,500 each.
Attorney General Mark Earley said the state had tried to negotiate a settlement under which PCH would agree to moderate its mailings but filed the suit after feeling it was being "stonewalled."
The suit charged that the company's mailings sometimes suggest that a company employee is "looking out for" a particular consumer and that just a few more subscriptions will put that person into a winning position. Others appear to "guarantee" a win, the suit alleged.
The flurry of state suits follow complaints by many of the Attorneys General that the February 18 class action settlement is inadequate.
A similar class action suit was settled recently by PCH's biggest rival, American Family Publishers, which agreed to pay $33 million to consumers and $7 million to various states.
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