Arkansas Attorney General Dustin McDaniel sued a New Jersey-based online advertiser in federal court Thursday, alleging that it has violated state and federal consumer protection laws by trying to force Arkansas businesses to pay $600 for services they never authorized.
McDaniel said his consumer protection division has received multiple complaints from business owners about calls received from Electronic Media Marketing Group Inc., doing business as General Yellow Pages.
The lawsuit alleges that representatives of the group called small businesses and tried to convince them that they had signed up for a 90-day free trial of an Internet advertising program for which they now owed money for an additional year of service because they had never canceled the service when the trial period ended.
In reality, McDaniel said, the businesses never accepted a free-trial period, never agreed to pay for services once a trial period expired and never received any services. The services, the lawsuit alleges, were “illusory.”
In a news release, McDaniel said, “In this audacious scheme, the defendant sought to deceive Arkansas business owners into paying for a service they had never heard of. When businesses did not fall for the scam, the defendant continued to send bills, make repeated phone calls and threaten collection actions.”
According to the 19-page lawsuit, randomly assigned to U.S. District Judge Leon Holmes, the attorney general’s office is seeking an injunction to stop the company from contacting Arkansas businesses, as well as court orders for it to pay full restitution to any affected consumers, the attorney general’s litigation costs, and civil penalties of up to $10,000 per violation of the Arkansas Deceptive Trade Practices Act.
The lawsuit states that the marketing group, incorporated in late 2009 in New Jersey but not actively registered with that state’s treasury department, has deceived Arkansas business owners since at least 2010, purporting to be an online advertising agency named General Yellow Pages, a name intended to deceive business owners because of its similarity to the “well-known Yellow Pages.”
Several victims of the scam, who have received invoices for $599 for a year’s worth of services, have, to no avail, demanded documentation from the marketing group of any agreements the businesses made to accept a trial service or pay for services. Even after the businesses complained to the attorney general’s office, the defendants continued to send invoices that tacked on late fees, with one bill topping $800, the suit states. It says the businesses have also continued to be harassed with phone calls and threats that debt collectors would be hired to pursue them.
A telephone number - that was listed on a letter that the marketing group sent to McDaniel’s office to protest a complaint against it and that was attached to the lawsuit - was answered briefly Thursday, but automatically disconnected after a short recorded announcement about mortgage rates.
The letterhead describes the marketing group as “an Internet marketing firm that owns different trade names and manages a myriad of advertising campaigns.”
Arkansas, Pages 16 on 02/21/2014