Officials in Wisconsin Attorney General James Doyle’s office said yesterday that they expect to appear in court tomorrow to argue their case against stamp sheet marketer Publishers Clearing House, Port Washington, NY.
“We are the first state attorney general to take the sweepstakes company to trial,” said Mike Henck, a spokesman for Doyle. Twenty-four other states and the District of Columbia settled similar lawsuits earlier this year.
According to Henck, Wisconsin law says sweepstakes marketers cannot make “false, deceptive or misleading statements in relation to selling a product, and [PCH] makes false, deceptive, and misleading statements [all the time].”
The Wisconsin lawsuit alleges that the sweepstakes promoter “has made numerous fraudulent claims to Wisconsin consumers and has preyed on the elderly and disabled through frequent mailings that are false and deceptive,” Henck said.
The lawsuit was filed earlier this year in Columbia County Circuit Court.
In August, Publishers Clearing House said it would pay $18.4 million in fines and restitution to settle lawsuits by 24 states and the District of Columbia. The lawsuits accused the company of using deceptive marketing practices in its mail promotions, which the states alleged fooled people into believing that they had won prizes or that purchasing products or magazine subscriptions would increase their chances of winning.
The company agreed to pay $16.1 million in restitution to consumers who spent $2,500 or more on subscriptions and merchandise that they purchased through PCH mailings in any one year from 1997 to 1999. PCH also will pay $2.3 million in fines that will be used to reimburse states for the cost of the investigation.
The states participating in the settlement were Alaska, Alabama, California, Georgia, Hawaii, Idaho, Illinois, Louisiana, Mississippi, Montana, Nebraska, Nevada, New Hampshire, New Mexico, New York, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Utah, Virginia, Washington and Wyoming. The agreement also includes the District of Columbia.
Wisconsin initially was part of the settlement but backed out of the deal. It is taking its case to trial to seek greater relief and restitution, because it did not believe the settlement was enough to prevent PCH from committing further violations.
Henck also said PCH sent a letter to one of the 14 witnesses on the attorney general’s witness list before that witness was to appear in court. “It isn’t fair for Publishers Clearing House to tell a witness he could receive a $10,0000 prize one week before the trial begins,” he said.
Christopher Irving, a PCH spokesman, said, “It continues to be our primary goal to reach an agreement with Attorney General Doyle of Wisconsin as we were able to do with the attorneys general of 25 other states in August, and it will continue to be our goal to do so before and during the trial. But, if we are not able to, we will and are prepared to vigorously defend ourselves at the trial.”
Irving said PCH is confident it will clearly present at the trial that:
• Consumers clearly understand Publishers Clearing House mailings.
• Consumers fully understand that no purchase is necessary and that they have not won any prize unless they have been selected as the winner.
• Publishers Clearing House does not target specific age groups.
“We look forward to the trial and are very confident that Publishers Clearing House mailings will be upheld, found to be clear, found to be legal, and that the allegations that have been raised by the Attorney General will be found to have no merit,” Irving said.
