Florida Attorney General Bob Butterworth has expanded the deceptive practices lawsuit his office filed against American Family Publishers in February by adding defendants and three counts, including a scheme to defraud, civil theft and lottery.
Butterworth said the Jersey City, NJ-based sweepstakes company was targeting elderly customers with deceptive, official-looking solicitations and illegally offering to rent or sell its lists of almost 470,000 senior citizens and retirees to other subscription promoters.
“We decided to amend the complaint because of an increase of knowledge about [AFP's] practices,” said assistant attorney general Victoria Butler. “The more we looked, the more we found.”
The amended complaint, filed Nov. 6 at the Hillsborough County Circuit Court in Tampa where the initial suit was filed, said AFP was double-billing customers and using collection agencies to try to collect unenforceable debts. The company, the suit said, sold the names of the elderly to other contest operators. While it did not link AFP to any fraudulent operations, it said that last year the company advertised for sale or rent the names and addresses of 349,542 people aged 55 or over who had entered the sweepstakes and the names and addresses of the 118,081 retirees who had entered.
But Jeanne Meter, a spokeswoman for AFP, said the company “does work with a broker to make available certain lists for rental purposes. But AFP never condones rental by demographics.”
She added that AFP has a very stringent review process.
“AFP has to approve the rentee and the use of the creative that the rentee will be using and never makes available lists of magazine buyers. What [AFP] has done, on occasion, is make available lists of people who do not buy or who do not rent. This conforms to all ethical guidelines of the direct marketing industry.”
According to Butler, the company did not notify consumers that they were going to be using this information for the purpose of selling it. “The fact that they compile this information and then send it to other direct marketers continues the whole scheme of trying to hit up these same people over and over.”
AFP said it was surprised by the amended complaint since it had come to an agreement with 35 of the 38 states that filed deceptive practices lawsuits against it with only West Virginia, Connecticut and South Carolina remaining. In March, AFP agreed to pay $1.25 million to 32 states and to Washington, DC to resolve the deceptive advertising lawsuit, and in August it settled with New York and Maryland. The agreements set new standards for sweepstakes promotions including a consistent annual guide for language that can be used.
Meyer said this amended complaint was done only to generate headlines that will “advance his political career,” she said, referring to Attorney General Butterworth. “The allegations that are in the complaint are not only preposterous, but they are also malicious and false. It is just another one of the silly publicity stunts that [the attorney general's office] has waged.”
The suit also added new defendants, including Time-Warner, the entertainment company that is part owner of American Family Publishers; Time, Inc., the parent company of Time Customer Service, which handles AFP's billing; Susan Caughman, chairwoman of AFP's parent company American Family Enterprises; and Timothy Adams, president of Time Customer Service.
