Southern Progress Corp., a publishing subsidiary of AOL Time Warner, and its Oxmoor House subsidiary agreed to pay $500,000 to settle charges related to its free-trial marketing efforts, the Federal Trade Commission said yesterday.
According to the FTC complaint, Oxmoor House failed to adequately inform consumers of their obligations under a 30-day free trial for book offers made through telemarketing and other advertising. Consumers who chose to keep a book beyond the free-trial period and agreed to pay were unknowingly enrolled in a book club, which sent them notices about other books, the FTC said.
Failure to return the notices would lead to further charges for the consumer, according to the FTC. Books included cookbooks and craft manuals such as “The Ultimate Southern Living Cookbook” and “Crafts and Keepsakes for the Holidays.”
In addition to the payment, Southern Progress, Birmingham, AL, and Oxmoor House agreed to cease attempts to collect unpaid bills on books shipped between Jan. 1, 1996, and Dec. 31, 2000. The publishers also agreed to add new disclosures to their marketing materials and pitches and to notify current customers of the full terms of their continuity plans by March 31, 2003.