Tag Archives: consumers

AG joins lawsuit against makers of addiction treatment drug

News release from Attorney General’s office
Attorney General Herbert H. Slatery III, along with the Division of Consumer Affairs, today announced the filing of an antitrust and consumer protection lawsuit against the makers of Suboxone, a prescription drug used to treat opioid addiction. Slatery and attorneys general from 35 other states filed the lawsuit over allegations that the companies engaged in an anti-competitive scheme to block generic competitors and cause consumers to pay artificially high prices.
Reckitt Benckiser Pharmaceuticals, now known as Indivior, is alleged to have conspired with MonoSol Rx to switch Suboxone, a brand-name prescription drug used to treat heroin addiction and other opioid addictions by easing addiction cravings, from a tablet version to a dissolvable film version in order to prevent or delay generic alternatives from entering the market while maintaining monopoly profits. Continue reading

State gets flood of gasoline price-gouging complaints

The Tennessee Department of Commerce and Insurance’s Consumer Affairs division is investigating about 600 complaints of gasoline price gouging received from consumers, reports WTVF-TV.

Typically, the state would get 5,000 total complaints every year.

“That’s off the charts for us, we are in the midst of of sorting through the overflow of complaints,” TDCI Communications Director Kevin Walters said. 

Prices increased as a result of a pipeline leak in Alabama nearly two weeks ago. Governor Haslam issued an executive order to increase the hours of truckers shipping fuel. Panic over a possible gas shortage prompted drivers to pack gas stations and tap them out throughout the mid-state.

“It was frustrating this weekend,” Tennessee Grocers & Convenience Store Association President Rob Ikard told NewsChannel 5. “There was a sudden and unnatural demand of gas over the weekend.”

Majority of the complaints were from the Nashville metro area with reports of gas prices ranging from $3 per gallon to as high as $9.99 per gallon. 

Under Tennessee law, it is unlawful to grossly charge essential goods or services in a time of emergency. 

There are so many complaints the Consumer Affairs staff is still logging the complaints. State officials say they will go through each complaint with a legal team to determine the validity.

Tennesseans to receive $8.5M in E-book price fixing case

News release from the attorney general’s office:
Tennessee Attorney General Herbert H. Slatery III today announced Tennessee residents who purchased electronic books (E-books) could begin receiving account credits or checks this week. Payments are the result of the successful prosecution of a price-fixing case against Apple, Inc. in 2013.

Tennessee joined a group of 33 states, led by Connecticut and Texas, in investigating and prosecuting Apple for its participation in the conspiracy to artificially inflate E-book prices. Apple is obligated to pay $400 million in nationwide consumer compensation after the United States Supreme Court denied Apple’s request to review a lower court’s finding that the company violated antitrust laws.

“Returning the hard-earned money of Tennessee consumers was the primary goal in this litigation,” Attorney General Slatery said. “I appreciate the hard work of our office, along with our colleagues in other states, to make certain all companies compete fairly and play by the same rules.” Continue reading

On Supermajority sunsetting state boards, commissions and such

Seventeen state government entities were abolished during the 108th General Assembly, and the chairman of a committee overseeing the “sunset” process says that is part of a Republican supermajority trend that will continue in the 109th General Assembly that begins Jan. 13.

The terminations were in addition to legislative approval of proposals submitted by Gov. Bill Haslam’s administration for merging or restructuring some entities.

As a prelude to the new session, joint subcommittees of the House and Senate government operations committees met last week to begin reviewing boards, commissions and other governmental agencies that are subject to termination, renewal or modification during 2015.

State Sen. Mike Bell, R-Riceville, who chairs the Senate committee, questioned the need for at least two of the entities, including the Consumer Advocate Division of the state attorney general’s office, which has been in existence since 1994 — created after what was described as a scandal — without ever being subject to a legislative review before.

Bell says he would like to bring still more entities under mandated scrutiny of the government operations committees — one example being the drug task forces operated by law enforcement organizations around the state, which he described as “a strange creature” that evolved as part of the District Attorneys General Conference without any legislative oversight.

“I’m always looking for another board or commission to get rid of,” Bell said.
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TN gets $233K in settlement with Sirius XM Radio

News release from state Attorney General’s Office:
Attorney General Herbert Slatery on behalf of Bill Giannini, the acting Director of the Tennessee Division of Consumer Affairs (DCA), along with the attorneys general of 44 states and the District of Columbia, announced today that Sirius XM Radio Inc. of New York has agreed to pay $3.8 million to the states and provide restitution to eligible consumers to resolve claims that the satellite radio company engaged in misleading advertising and billing practices. Tennessee will receive $233,000.

Consumers who have not previously filed a complaint with their attorney general or state complaint handling entity such as DCA for the practices covered by this settlement have until May 3, 2015 to file a complaint to be considered for restitution.

“I am pleased that part of the settlement includes restitution to eligible consumers and I encourage those who have had difficulties with Sirius XM to file a complaint with the Division of Consumer Affairs on or before May 3, 2015 so they can be considered for a refund,” said Attorney General Slatery.

The states’ investigation focused on consumer complaints involving allegations of difficulty canceling contracts; cancellation requests that were not honored; misrepresentations that the consumer’s Sirius XM service would be canceled and not renewed; contracts that were automatically renewed without consumers’ notice or consent; unauthorized fees; higher, unanticipated rates after a low introductory rate; and Sirius XM failing to provide timely refunds. Sirius XM has denied wrongdoing in the settlement.

The settlement requires Sirius XM to make significant changes to its business practices. Specifically, Sirius XM agrees to:

Clearly and conspicuously disclose all terms and conditions at the point of sale, such as billing frequency, term length, automatic renewal date, and cancellation policy;
Make no misrepresentations about the available plans in advertisements;
Provide advance notice via mail or email about upcoming automatic renewals for plans lasting longer than six months;
Revise the cancellation procedures to make it easier for consumers to cancel; and,
Prohibit incentive compensation for customer service representatives based solely on “saves,” or retaining current customers who attempt to cancel.
“We are satisfied with the terms of the settlement and believe Tennesseans will benefit from the changes that Sirius XM has agreed to make,” said Bill Giannini, Department of Commerce and Insurance Deputy Commissioner/Acting Director of Consumer Affairs. “Customers who believe they are entitled to be part of the settlement should contact the Tennessee Division of Consumer Affairs for more information.”

Consumers who have a complaint regarding Sirius XM’s business practices addressed by this settlement are urged to contact DCA at www.tn.gov/consumer or 615-741-4737 or 800-342-8385 (inside Tennessee) by May 3, 2015. Consumers who have complained to Sirius XM directly and believe that their complaint remains unresolved can file complaints at www.siriusxm.com/settlementprogram or by mail to PO Box 33059, Detroit, MI 48232-5059. In addition, consumers should retain a copy of the complaint they file to be considered for the restitution along with proof of the date of filing of the complaint.

Consumers may contact DCA at www.tn.gov/consumer or 615-741-4737 or 800-342-8385 (inside Tennessee) if they feel they have been the subject of an unfair or deceptive business practice.

TN AG settles with Apple Inc. on alleged E-book price fixing

News release from state Attorney General’s Office:
Tennessee Attorney General Bob Cooper today announced a proposed settlement of claims for monetary relief against Apple Inc. related to its participation in a price-fixing conspiracy in the market for E-books. The settlement agreement, which remains subject to approval by the U.S. District Court for the Southern District of New York, would resolve claims for consumer damages brought by Tennessee and 32 other states and territories.

Pursuant to the terms of the settlement, the amount to be received by consumers is contingent upon the resolution of Apple’s appeal of the District Court’s July 2013 finding that Apple violated the antitrust laws by orchestrating a conspiracy with five publishers to artificially raise prices for E-books between 2010 and 2012. That appeal is currently pending before the United States Court of Appeals for the Second Circuit. Consumers nationwide (including those represented by private counsel in a related class action) will receive $400 million if the court’s ruling is ultimately affirmed. If the appellate courts do not affirm the court’s ruling, the settlement provides for a smaller recovery, or no recovery if Apple is ultimately determined not to have violated the antitrust laws.

Attorney General Cooper said he is pleased with this settlement, which, combined with previous publisher settlements, will provide consumers with over twice their actual damages, assuming the liability finding is upheld on appeal. Tennessee consumers comprise approximately 1.7 % percent of E-book purchasers in the country.

E-book purchasers nationwide have already received compensation from $166 million in settlement funds paid by the five publishers involved in the conspiracy – Penguin Group (USA), Inc. (now part of Penguin Random House); Holtzbrinck Publishers LLC d/b/a Macmillan; Hachette Book Group Inc.; HarperCollins Publishers LLC; and Simon & Schuster Inc.

New law prompts ‘lawsuit lending’ business to leave TN

News release from Alliance for Responsible Consumer Legal Funding
Northbrook, Illinois -Oasis Legal Finance, a member of ARC, announced today it will became the first of what is expected to be a mass exodus of companies from the state of Tennessee following the enactment of legislation that places unprecedented price controls and other anti-business measures on a product relied upon primarily by citizens recovering from injuries in auto accidents and in need of temporary financial assistance.

Oasis Legal Finance, based in the Chicago area, is one of the nation’s largest and most respected providers of consumer legal funding services. They announced they will exit the Tennessee market effective July 1, 2014 as a result SB-1360, which Governor Bill Haslam signed on April 29.

(Note: The bill was hotly debated in the House. See previous post at the time HERE)

“We weren’t bluffing. We told lawmakers the industry would have no choice but to cease service to Tennessee consumers, which is exactly what we are doing,”said Oasis CEO Ralph Shayne. “It is lose-lose in Tennessee. Consumers will lose access to funding. Funding company employees will lose their jobs. The only winner is a billion-dollar insurance industry that now has even greater leverage over injured Tennessee citizens seeking fair settlements.”

Shayne explained that consumer legal funding is a product that helps consumers injured in an accident, who have both a pending legal claim and are represented by an attorney, by providing them debt-free, non-recourse financial assistance to help them make ends meet while they wait for a fair settlement to be reached in their case. These needs usually arise when a consumer has unexpectedly been in an automobile accident, usually through no fault of their own, that leaves them out of work, with limited financial resources to pay bills or put food on the table, all while awaiting their legal claim to be heard.
Harvey Hirschfeld, Chairman of the American Legal Finance Association and President of LawCash, added, “The enactment of this industry killing bill means the end to the consumer legal funding industry in Tennessee. As many of our members who operate businesses in Tennessee have indicated to us, they have begun the process of notifying consumers and employees that they will be winding down their Tennessee operations at the beginning of this summer.”

Dan Cleary, operator of a Nashville based legal funding company Provident Litigation Funding, Inc., stated, “I am an entrepreneur who has successfully served Tennesseans without incident for 13 years. I am shocked and appalled by the success out of state insurance companies achieved by using the Tennessee legislature to bully my locally built company.”

The bill, which instituted price controls on the amount a private business could charge for its services, was fought by a bipartisan group of legislators in the Tennessee House of Representatives before the legislation was narrowly approved on April 3. According to consumer legal funding industry sources, the Tennessee law’s price control provisions, would effectively force the industry to operate at a loss.

In addition to the price control provisions within SB-1360, the bill also included two other provisions designed to drive the industry from the State:

•An anti – assignment provision prohibiting a consumer legal funding company from putting receivables on their bank lines starting on the bill’s effective date of July 1, 2014.
•A provision on liens which states ANY lien must be satisfied before a consumer legal funding company is to receive funds -no matter who holds the lien or when the consumer grants the lien.

“Using the legislative process to favor one business at the expense of another should send a chill up the spine of any American who believes in free markets and free enterprise. It is especially deplorable when the outcome of this process hurts consumers,”concluded Shayne.

Alliance for Responsible Consumer Legal Funding
ARC members support the strong but sensible regulation of the consumer legal funding industry. Members serve as a lifeline to consumers as they wait for the fair resolution of their cases by providing them with funds to enable them to pay daily living expenses such as rent and mortgage payments, put gas in their cars and food on the table, and buy essential school supplies for their children.

AG sues ‘timeshare and membership vacation club’

News release from attorney general’s office:
Tennessee has filed a lawsuit against various entities operating a ‘timeshare’ and membership vacation club that allegedly employs deceptive techniques to market their products, Attorney General Bob Cooper and the Tennessee Division of Consumer Affairs of the Tennessee Department of Commerce and Insurance (TDCI) announced today. Tennessee’s lawsuit comes after a multi-state investigation of Festiva’s sales and marketing practices. Maine and Louisiana each filed suit against Festiva during December.

Tennessee’s Complaint alleges that Festiva operates a telemarketing and direct mail enterprise that uses fraudulent and deceptive tactics to lure Tennesseans into attending high-pressure sales presentations to buy vacation memberships. According to complaints reviewed by the Tennessee Attorney General’s Office, consumers are misled into believing that they have won or been selected for a valuable prize, but to claim the prize, they must comply with many undisclosed requirements including a lengthy, high-pressure sales presentation.
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Cooper testifies on predatory lenders targeting military personnel and families

Tennessee’s attorney general was among those testifying Wednesday before the U.S. Senate Committee on Commerce, Science & Transportation about predatory lenders taking advantage of those serving in the military.

Excerpt from an Army Times story on the proceedings:

Consumer protection laws are not protecting U.S. troops and their families from a combination of predatory lending practices and aggressive debt collection, key lawmakers said Wednesday.

Federal and state officials responsible for regulating lenders warned that a combination of outright lawbreaking and skirting around the edges of consumer protections requires both better financial education for service members and better laws.

…There is no line predator businesses won’t cross, said Tennessee Attorney General Robert E. Cooper Jr., who related an “egregious example of abusive conduct”: a company that for seven months attempted to collect money from the bank account of a soldier who had been killed in Iraq after being tortured and beheaded.

Tennessee ultimately won a default judgment against the company, which sold electronics to service members at high prices and at high interest rates. All collections were stopped, all debts canceled and the service members were allowed to keep the computers and other equipment they had purchased, he said.

Cooper warned that stopping such businesses is not easy. “Defendants in this and other cases who prey on our men and women in uniform will go to great lengths to stay in business because it is very lucrative,” he said.

TN part of $30M settlement on alleged discount club deception

News release from state Attorney General’s Office:
Tennesseans may be entitled to refunds as a result of an agreement resolving allegations a company deceptively enticed consumers to enroll in a variety of discount club programs, Attorney General Bob Cooper announced today.

Tennessee and 46 others states and the District of Columbia named in its lawsuit and settlement Connecticut-based Affinion, and its subsidiaries Trilegiant and Webloyalty. The parties have agreed to pay the states more than $30 million.

Affinion and its subsidiaries run multiple discount clubs and membership programs offering a variety of services such as credit monitoring, roadside assistance, and discounted travel. Affinion markets these programs through a series of agreements with “marketing partners,” including well-known banks and retailers. The partners often immediately offer programs to consumers after they make a transaction. Affinion’s programs are marketed via direct mail, online, telemarketing, and through point-of -sale transactions. Affinion charges a monthly fee to consumers for these services, which continues until the consumers affirmatively cancel.

Consumers complained that Affinion charged them for services without consumers’ authorization or knowledge. Some consumers reported that once they realized they were being charged for the services, they had trouble canceling or getting a refund. Other consumers were confused about who Affinion was because the offers looked like they came from its marketing partners, which usually were banks or retailers with which the consumers did business.
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