AOL Accused of Charging for Unwanted Merchandise

AOL Time Warner Inc.'s America Online unit faces a lawsuit that alleges the Internet service provider delivered and charged customers for merchandise they did not buy.

The lawsuit, filed Feb. 22 in U.S. District Court in San Francisco, claims that AOL “unlawfully charged and collected money for … unordered merchandise and shipping and handling charges from subscribers' credit cards, debit cards and checking accounts.” The suit alleges that AOL charged customers for merchandise advertised on its service, even though they clicked on the “no thanks” button in the ad for the merchandise.

Barry Himmelstein, a lawyer with the San Francisco firm of Lieff Cabraser Heimann & Bernstein LLP, which represents some of the plaintiffs, said his firm received dozens of complaints about AOL's alleged practice.

“We are currently investigating complaints that America Online and CompuServe have shipped merchandise to subscribers that the subscribers never ordered and charged the subscribers' credit card that AOL or CompuServe has on file for the unordered merchandise,” a note on the Lieff Cabraser Web site said.

The suit seeks class-action status. No court date has been set.

AOL spokesman Nicholas Graham dismissed the lawsuit as being without merit. The company plans to “vigorously contest” the lawsuit in court, he said.

The lawsuit claims that an Oakland, CA, woman was charged $10 for a desk planner and $171 for a stereo she never bought. Another California woman alleges she was charged $74 for bedsheets she did not want.

The suit seeks unspecified damages and the return of unauthorized payments to the plaintiffs. It also seeks to let the plaintiffs keep the merchandise they claim they did not order — at AOL's expense.

Subscribers spent $33 billion last year on merchandise offered through AOL's shopping channels, the company said. They spent $11 billion in fourth-quarter 2001 alone.

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