Recently Resolved Matters
State of Wyoming Cases
The Attorney General's Office conducts investigations and takes enforcement actions against businesses that appear to be violating the Wyoming Consumer Protection Act. Here are some recent cases that the Wyoming Attorney General has resolved on behalf of consumers:
Cheyenne Labs, LLC (Case No. 2014-21): Consumers complained that Cheyenne Labs, LLC did not clearly disclose the terms of its $4.95 "trial offer" for skin care products. Consumers were hit with recurring monthly charges sometimes totally nearly $90 a month by signing up for the "trial offer." Consumers also reported problems cancelling and/or obtaining refunds from Cheyenne Labs. Cheyenne Labs agreed to refund all customers in Wyoming. The company agreed to clearly and conspicuously disclose the material terms of its products offered online and to make it easier for consumers to cancel with the company.
Cheyenne Labs, LLC (Case No. 2014-21) Refunds offered to all Wyoming consumers in the amount of $4,160.87.
Liberty Global, LLC (Case No. 2014-09): Liberty Global, LLC appeared to be marketing and selling prescription cancer drugs out of a home in Cheyenne. The Attorney General's Office began an investigation and learned that the company was actually based overseas and was simply using its registered agent's home street address as its headquarters for both online commerce and bank account purposes. During the investigation, Liberty Global, LLC ceased operations and voluntarily dissolved. The registered agent agreed that she would not represent that companies for which she acted as the registered agent were based at her home address and she agreed that she would not assist companies in opening up bank accounts.
Zoe Auto Sales, LLC (Case No. 2013-08): This “buy-here-pay-here” auto dealer was investigated after the Attorney General’s Office was notified that consumers may have been unaware of the use of locating devices that the company installed in vehicles it financed. Zoe Auto Sales contends it was not required to disclose the existence of these devices, and that its Contract did put consumers on notice of the possibility of the use of locating devices. However, Zoe Auto Sales agreed that, when selling to Wyoming consumers, it will provide verbal notice of the use of locating devices as well as a separate written notice signed by the consumer and the dealer.
Silver River Management, LLC (Case No. 2013-24): Consumers complained that Silver River Management, LLC required that they repay their pay day loans through Western Union or Money Gram transactions and charged excessive amounts of interest for the loans. Silver River Management, LLC and its owner agreed that they would not require repayment of loans in any manner other than required by the loan agreement. They also agreed that they would not charge interest on loans made to Wyoming residents in excess of that allowed by Wyoming law. Silver River Management, LLC and its owner also agreed to repay any excessive interest charged and collected from Wyoming residents.
Silver River Management, LLC (Case No. 2013-24) Refunds offered to Wyoming borrowers in the amount of $35,584.45.
Iowa Steak Company, L.C. (Case No. 2014-05, Docket 183-071): The complaint in this matter alleged that Iowa Steak Company, and three of its salesmen violated the Wyoming Consumer Protection Act by making false and deceptive claims regarding price discounts for door-to-door meat sales. The complaint also alleged that the defendants failed to comply with Wyoming's door-to-door solicitation requirements. The consent judgment requires that Iowa Steak Company comply with the terms of the Act and offer refunds to all the Wyoming residents who purchased product. It also requires that Iowa Steak Company pay a civil penalty of $5,000. The individual salesmen were also required to pay civil penalties.
Iowa Steak Company, L.C. (Docket 183-071) Refunds offered to all Wyoming purchasers. Civil Penalty: $5,000.00
Silver King International (Case No. 2013-27): This matter involved a company that called consumers to conduct a purported survey that was allegedly used to screen leads for the sale of its product. After the survey was conducted, Silver King International called consumers to offer a free prize and would also schedule in-home demonstrations of its product. Although Silver King International denied that its actions constituted any violation of law, it agreed to a number of restrictions on all future transactions with Wyoming consumers, including the following: Silver King International will not make unsolicited telephonic sales calls to consumers on the federal or state do-not-call lists, it will comply with the notice requirements of Wyoming's prize and home solicitation statutes, and it will not make false or misleading statements to consumers.
Silver King International (Case No. 2013-27) Civil Penalty: $15,000.00.
Mygreenbeanextract, LLC (Case No. 2014-07): Consumers complained that they were charged unauthorized fees for products purchased from the company pursuant to a free 14 day trial offer. Consumers thought that they only had to pay the nominal shipping fee to test out the product and were surprised when they learned that they were being charged for the full price of the product. Consumers also complained that they had a difficult time obtaining refunds. An investigation revealed that the company represented that it was based in Cheyenne, Wyoming when in fact it had no connection to Wyoming other than the fact that it was a Wyoming entity and had mail forwarding services from locations in Wyoming. The company and its owner agreed to resolve the matter by offering refunds to all Wyoming consumers who had paid anything beyond the nominal shipping charge. The company and its owner also agreed to strict disclosure requirements and agreed not to present the company as being based in Wyoming unless it had an actual presence or office in Wyoming.
Mygreenbeanextract, LLC (Case No. 2014-07) Refunds offered to all Wyoming purchasers. Some purchasers accepted refunds.
The Sharps Rifle Company, Inc. (Case No. 2012-11): This case involved a firearm manufacturer which took deposits and payments on handguns from consumers. Despite the passage of many months and even years, consumers never received the final product from the manufacturer. The company, and the CEO of a predecessor of the company agreed to resolve the matter by refunding in full the 140+ consumers who made deposits or other payments for the firearms. The company and the former CEO agreed to abide by the 30 day rule. They also agreed not to market, advertise, sell or take deposits or payments on any merchandise that was not in final production.
Sharps Rifle Company, Inc. (Case No. 2012-11) Total Refunds: $140,382.88.
Al Jones (Case No. 2012-11) Total Refunds: $5,000.00.
Worldwide Points Solutions, LLC, American Points Exchange, LLC and Jim Cintron a/k/a Demetrio Cintron (Case No. 2013-10): Consumers complained about misrepresentations made to them with respect to a timeshare point plan. The companies involved, and their owner, agreed to refund the complaining consumers. They also agreed not to make inaccurate claims about affiliated companies, or make any claims about the expected earnings or returns that might be made by engaging in the timeshare point plan.
Worldwide Points Solutions, LLC, American Points Exchange, LLC and Jim Cintron a/k/a Demetrio Cintron (Case No. 2013-10) Total Refunds: $17,815.00.
Doug Scholl d/b/a Scholl Landscaping and Tree Service (Case No. 2013-13): This case arose out of the activities of a landscaper. Consumer complained that the landscaper was taking deposits for work on their property, but failed to follow through with the projects. The landscaper agreed to refund the complaining consumers. The landscaper also agreed not to accept a deposit or payment from any consumer for landscaping, yard maintenance or tree removal services prior to fully completing all services as promised.
Doug Scholl (Case No. 2013-13) Total Refunds: $2,615.00.
Carlos Palomo, Victoria Adenusi, VC Merchant Systems, LLC, Vendors Merchant Network, Vendors Choice Merchant Systems, V.C. Direct Solutions, LLC, and Progressive Media Group, LLC (Case No. 2012-03): This case arose out of consumer complaints about a home business opportunity. Consumers were told they would make money processing credit cards. They were then sold thousands of dollars in “leads” that typically yielded no profit. The companies and their owners agreed to refund the consumers. They also agreed to certain disclosures about restrictions on the representations they could make to consumers.
Carlos Palomo, Victoria Adenusi, VC Merchant Systems, LLC, Vendors Merchant Network, Vendors Choice Merchant Systems, V.C. Direct Solutions, LLC, and Progressive Media Group, LLC (Case No. 2012-03) Total Refunds: $112,380.00.
SeoWorldwide.com, LLC and Robert Raskin (Case No. 2013-20): This case involved complaints about representations the company made about its search engine optimization services. The company and its owner agreed to make refunds and agreed to restrictions on the representations they could make about the services provided.
SeoWorldwide.com, LLC and Robert Raskin (Case No. 2013-20) Total Refunds: $16,985.00.
National and Multistate Cases
The Attorney General also participates in national level, multistate actions. Here are some recently resolved multistate cases that the Wyoming Attorney General has participated in on behalf of Wyoming residents.
T-Mobile USA, Inc. Mobile Cramming: This matter addresses “Mobile Cramming,” or the placement of unauthorized third-party charges on mobile phone bills. It is similar to the AT&T case described below. A mobile phone user can subject themselves to third party mobile charges in a variety of ways. They might simply reply to a text message, enter their phone number on a website, or click on a website accessed from their phone. Disclosure that this constitutes a purchase is often unclear, if disclosed at all. The questionable purchase is passed on to mobile carriers to collect and it shows up, often inadequately labeled, on the consumer’s phone bill.
This settlement with T-Mobile resolves many of the problems arising from mobile cramming by providing for greater disclosure and consent regarding the third party charges. The settlement requires that T-Mobile must obtain express informed consent from consumers before a consumer is billed for third party charges.
T-Mobile must implement a system for giving consumers a purchase confirmation for any third party charges. T-Mobile’s bills will also be revised to show the third party charges in a separate section so that consumers can distinguish between T-Mobile’s mobile charges and the third party charges. The settlement required that T-Mobile pay Wyoming the amount of $189,952.76. This amount was deposited into the General Fund.
Consumers can submit claims under the Program by visiting http://www.t-mobilerefund.com. On that website, consumers can submit a claim, find information about refund eligibility and how to obtain a refund, and can request a free account summary that details PSMS purchases on their accounts. Consumers who have questions about the Program can visit the Program website or call the Refund Administrator at (855) 382-6403.
AT&T Mobile Cramming: This matter addresses “Mobile Cramming,” or the placement of unauthorized third-party charges on mobile phone bills. A mobile phone user can subject themselves to these third party charges in a variety of ways. They might simply reply to a text message, enter their phone number on a website, or click on a website accessed from their phone. Disclosure that this constitutes a purchase is often unclear, if disclosed at all. The questionable purchase is passed on to mobile carriers to collect and it shows up, often inadequately labeled, on the consumer’s phone bill.
This settlement with AT&T resolves many of the problems arising from mobile cramming by providing for greater disclosure and consent regarding the third party charges. The settlement requires that AT&T must obtain express informed consent from consumers before a consumer is billed for third party charges. AT&T must implement a system for giving consumers a purchase confirmation for any third party charges. AT&T’s bills will also be revised to show the third party charges in a separate section so that consumers can distinguish between AT&T’s mobile charges and the third party charges. The settlement also required that AT&T pay Wyoming the amount of $211,058.62. This amount was deposited into the General Fund.
GlaxoSmithKline, LLC: As part of a national multistate action, Wyoming reached a settlement with GlaxoSmithKline, LLC to resolve allegations that GlaxoSmithKline unlawfully promoted its asthma drug, Advair®, and antidepressant drugs, Paxil® and Wellbutrin®. The Complaint and Consent Judgment filed today alleges that GlaxoSmithKline violated state consumer protection laws by misrepresenting the uses and qualities of these drugs.
The Consent Judgment requires GlaxoSmithKline (GSK) to reform its marketing and promotional practices. Specifically, GSK shall not:
• Make, or cause to be made, any written or oral claim that is false, misleading, or deceptive about any GSK product;
• Make promotional claims, not approved or permitted by the FDA that a GSK product is better, more effective, safer, or has less serious side effects or contraindications than has been demonstrated by substantial evidence or substantial clinical experience;
• Present favorable information or conclusions from a study that is inadequate in design, scope, or conduct to furnish significant support for such information or conclusions, when presenting information about a clinical study regarding GSK products in any promotional materials;
• Provide samples of GSK products to those health care professionals who are not expected to prescribe the sampled GSK products for an approved use, but who would be expected to prescribe the sampled product for an off-label use; or
• Disseminate information describing any off-label use of a GSK product, unless such information and materials are consistent with applicable FDA regulations and FDA Guidances for Industry.
The Consent Judgment also requires GSK to pay Wyoming the amount of $1,141,487.54. This amount has been paid into the General Fund.
Affinion Group, Inc., Trilegiant Corporation and Webloyalty.com, Inc., Docket 181-698: This case addressed several of Affinion’s marketing practices that misled consumers, including a lack of clear and conspicuous disclosure about Affinion’s identity, and the cost and ongoing nature of the charges. Most troubling were two marketing practices of Affinion – live checks and online data pass. In a live check solicitation, consumers were sent via direct mail an offer that appeared to be a check – but when consumers endorsed and deposited the checks, the consumers unknowingly authorized Affinion to enroll them in membership programs, and to bill them each month indefinitely. In an online data pass offer, consumers were presented an Affinion offer immediately after an online purchase from a retailer. Affinion was then able to enroll and bill consumers without acquiring any of their account information because the marketing partner would pass that information to Affinion. Both practices are prohibited under the judgment. Additionally, the judgement resulted in a total of roughly to Wyoming residents. A deposit was made to the Consumer Protection Trust Fund in the amount of $25,000.00. Another deposit was made to the General Fund in the amount of $28,223.19.
Affinion Group, Inc., Trilegiant Corporation and Webloyalty.com, Inc., Docket 181-698 Total Refunds: $91,256.30
Lenders Processing Services, Inc., LPS Default Solutions, Inc., and DOCX, LLC, Docket 180-691: This case addressed surrogate signing of title documents, as well as related practices. The judgment requires proper execution of documents and prohibits signatures by unauthorized persons or those without first-hand knowledge of facts attested to in the documents. It also includes enhanced oversight of the default services provided, and a review of all third-party fees to ensure that the fees have been earned and are reasonable and accurate. Lenders Processing Services, Inc., also agreed to review documents executed during the period of January 1, 2008 to December 31, 2010 to determine what documents, if any, need to be re-executed or corrected. If LPS is authorized to make the corrections, it will do so. The judgment required that LPS pay the state of Wyoming the amount of $232,491. This amount was deposited into the Consumer Protection Trust Fund.
Tulips Investments, LLC v. Colorado. The Wyoming Attorney General filed an amicus brief in the Colorado Supreme Court on an issue of national importance regarding the power of an agency, such as the Attorney General to issue administrative investigative subpoenas on nonresidents. 35 states joined Wyoming on that brief. The Colorado Supreme Court held that such investigative subpoenas could be served and enforced on nonresidents.
Amicus Brief (Filed March 11, 2014)
Colorado Supreme Court Decision Filed January 12, 2015)