ADVERTISEMENTS

In re Vonage Holdings Corp., AVC, PIF 2817

Supplier agrees to make clear and conspicuous disclosures of all material terms and limitations regarding the advertising of free or discounted service or equipment, any money back guarantee offered to consumers, or any additional equipment a consumer needs to purchase to obtain the service.  Supplier shall clearly and conspicuously disclose all information regarding the cancellation process, including a valid and accessible telephone number for cancellations.  Supplier shall not continue to bill any customer, or deduct any additional amounts from any customer's bank account who has expressed a desire to cancel their service.  Supplier to pay $3,000,000 to the participating states.

ARBITRATION
Stachurski v. DirecTV, Inc., N.D. Ohio Case No. 08-CV-2850, PIF 2818

An arbitration clause in an "accept or return" contract is not unenforceable because a consumer failed to read or sign the agreement.  By continuing to accept Defendant's services, the Plaintiffs agreed to the terms and conditions of the Customer Agreement, including the arbitration clause.  The Court found that the arbitration clause was not procedurally unconscionable because Plaintiffs did not need to sign the agreement - they accepted the terms by continuing to accept the services.  The Court also found that satellite TV is not a necessity and Defendant was not the only provider of those services, so the inclusion of the arbitration clause in a standardized form was not unconscionable.  There was an imbalance in bargaining power between the parties, but there was no evidence that Plaintiffs were defrauded or coerced into the agreement.  Both the arbitration clause and the provision allowing Defendant to unilaterally modify the agreement were unambiguous and clearly disclosed.  The fact that the arbitration clause contained a class action waiver was not substantively unconscionable, as class actions are procedural mechanisms, not a substantive right.  Plaintiffs also failed to show that the cost of arbitrating their claims would be greater than the cost of litigating in court.  As the arbitration clause was not unconscionable, the Court dismissed the action.

Credit Acceptance Corp. v. Davisson, N.D. Ohio Case No. 08-CV-107, PIF 2819

The Court found that since the CSPA does not apply to all contracts, it cannot be used to invalidate the arbitration clause.  The Court also found that the arbitration clause did not prevent consumers from vindicating their statutory causes of action, and was therefore an enforceable provision of the contract.  The Court rejected Defendant's argument that the arbitration clause was unenforceable as it precluded a class action.  The Court found that an agreement does not violate a consumer's rights merely because it precludes a small number of remedies. 

CLASS ACTION
Konarzewski v. Ganley, Inc. (Cuyahoga Cty.), 2009-Ohio-5827, PIF 2816

The Court of Appeals reversed the trial court's denial of class certification.  Plaintiffs purchased a used car from Defendants, and signed a Retail Installment Sales Contract as well as a Conditional Delivery Agreement.  Approximately five days after the purchase, Defendant contacted Plaintiffs and informed them that they had been unable to obtain financing under the terms in the RISC and requested an additional $7,000 in order to complete the deal.  Defendant claimed that the CDA made the purchase conditional upon financing approval.  Plaintiffs filed a class action suit.  The Court of Appeals found that the trial court had erred by denying the class certification, as Plaintiffs had sufficiently identified and defined a proper class, that Plaintiffs' claims were typical of the class, the class action was maintainable under Rule 23(B)(2), and common questions of law or fact predominate over individual issues.  The Court also found that the class action could proceed under the CSPA, as the definition of the class could be easily modified so as to only include those persons who had suffered actual damages, pursuant to R.C. 1345.09(B).  Case remanded to the trial court for further action consistent with the Court of Appeals' decision.

DISTRESS SALES
In re Aria's Oriental Rugs, Inc., AVC No. 367928, PIF 2821

Supplier agrees that: 1) it will not indicate or imply that a sale, bargain, or other reduction in price will terminate within a given or anticipated period of time unless it does terminate within the period indicated in violation of OAC 109:4-3-12(D)(1); 2) it will not advertise, conduct, or continue any distress sale for a period greater than forty-five days in violation of OAC 109:4-3-17(B)(2) and ; 3) it will not fail to include the opening and terminating dates of a distress sale in any advertisement concerning a distress sale in violation of OAC 109:4-3-17(B)(5).  Supplier to pay $1,500 in investigative and administrative costs, and $10,000 (suspended) to the Consumer Protection Enforcement Fund.

Huntington National Bank v. International Diamond and Gold Co., Delaware Cty. Case No. 09 CVH 04 482, PIF 2822

The Court found that the going out of business sale conducted by International Diamond and Gold ("IDG") and Michael Barren ("the Receiver") was subject to the CSPA, and ordered IDG and the Receiver to stop the sale at the close of business on December 24, 2009, to clearly and conspicuously display the closing date of the sale in all advertising, to cease augmenting the inventory of IDG after December 14, 2009, and to return any and all merchandise received after December 14, 2009 to the suppliers.

HOME IMPROVEMENT
Krieger v. United Roofing, Summit Cty. Case No. CV 2008 02 1320, PIF 2814

Defendants violated HSSA and the CSPA by failing to provide the Notice of Cancellation required by R.C. 1345.23(B)(2) and (3), by using inferior materials in the repair of Plaintiff's roof instead of the materials promised, and by performing the work in an unworkmanlike manner.  Plaintiff awarded $15,000.00 in damages and $2,500.00 in attorney fees.

MOTOR VEHICLES
Morgan v. Paolone, Mahoning Cty. Case No. 08 CV 2892, PIF 2813

Defendant committed unfair and deceptive acts and practices in violation of the CSPA by: 1) failing to credit the value of the Plaintiff's trade-in on the Used Car Order, 2) failing to list the Plaintiff's down payment on the Used Car Order, 3) failing to deliver a certificate of title for the motor vehicle within 40 days, 4) failing to disclose on the Used Car Order the mileage appearing on the odometer of the vehicle at the time of sale and whether that mileage was correct, 5) failing to display a buyer's guide in the window of the vehicle at the time of the sale, and 6) failing to register the fictitious name "Big Al's Motor Cars" with the Secretary of State.  Defendant ordered to pay damages of $7,900.00 and attorney fees, to be determined later.

Haynes v. Courtesy Auto Mall of Galion, Inc., Richland Cty. Case No. 2008 CV 181, PIF 2815

The Court found that Defendant had committed unfair and deceptive acts and practices in violation of the CSPA by: 1) representing that the motor vehicle had one prior owner when in fact it had six previous owners in violation of OAC 109:4-3-16(B)(3), 2) misrepresenting that the financing obtained for the Plaintiffs was the lowest interest rate they could get, 3) failing to give Plaintiffs a copy of the loan papers, 4) misrepresenting the benefits of an extended warranty, including the deductible and the availability of a rental car, 5) failing to honor a warranty in violation of OAC 109:4-3-09(A), and 6) engaging in a pattern of inefficiency and incompetence in repairing a motor vehicle.  The Court found that the Defendant had acted knowingly.  Plaintiffs awarded $2,205 in treble damages, $5,000 for each Plaintiff in non-economic damages, and attorney fees of $14,700.

RESIDENTIAL MORTGAGE
State ex rel Cordray v. First Ohio Banc & Lending, Inc., Belmont Cty. Case No. 07 CV 259, PIF 2820

It is a violation of the CSPA to knowingly attempt to compensate, instruct, induce, coerce, or intimidate an appraiser for the purpose of improperly influencing the appraiser’s independent judgment with regard to the value of a dwelling offered as security for a mortgage loan.  It is an unfair and deceptive act or practice to fail to clearly and conspicuously disclose, in close proximity to an offer, any material exclusions reservations, limitations, modifications, or conditions on said offer, including but not limited to, any restrictions or conditions related to obtaining lower monthly mortgage payments or a certain rate.  Placement of exclusions, reservations, limitations, modifications or conditions in a footnote to an advertisement is not in close proximity to the words stating the offer, and is therefore a violation of R.C. 1345.02 and OAC 109:4-3-02(C).  Defendant failed to maintain a file of all advertising, and failed to maintain procedures reasonably adopted to avoid that omission in violation of R.C. 1322.06(B), R.C. 1345.02, and OAC 1301:8-7-07(H).  It is a violation of R.C. 1322.06(D), R.C. 1345.02, and OAC 109:4-3-24(G) to fail to maintain all appraisal related documents, including all appraisal request forms.  Including language on an envelope warning of fines and imprisonment for interfering with the delivery of a letter or that could lead a reasonable consumer to believe that the letter was sent on behalf of, or was endorsed or approved by a governmental entity, or that Defendant was affiliated with a governmental entity is a violation of R.C. 1322.06(D), R.C. 1345.02(B)(9), OAC 1301:8-7-07(F)(7), and OAC 1301:8-7-07(F)(6).  Failing to state all material limitations and exclusions, including those on advertised interest rates and term offers is a violation of OAC 1301:8-7-07(F)(2) and OAC 109:4-3-02(A)(1).  Offering a "net effective interest rate" in advertising without clearly and conspicuously indicating that such rate was only available if a consumer enrolled in a biweekly payment program was an offer of a an interest rate that could not reasonably be fulfilled or substantiated, in violation of OAC 1301:8-7-07(F)(3), OAC 109:4-3-10, and R.C. 1345.02.  A supplier who represents an employee as a third-party professional without disclosing the employee's affiliation with the supplier violates R.C. 1322.07(B)(C), R.C. 1345.02, and OAC 109:4-3-02(A).  A supplier who fails to include its mortgage broker license number on its advertisements violates R.C. 1322.09, R.C. 1345.02, and OAC 1301:8-7-07(B)(2).  Defendant ordered to pay civil penalty of $65,000 ($25,000 suspended), attorney fees and investigative costs of $15,000 ($5,000 suspended), and consumer restitution of $2,400.

UNFAIR AND DECEPTIVE ACTS AND PRACTICES
State ex rel Cordray v. Trump Travel, Franklin Cty. Case No. 06-CVH-08-11085. PIF 2811

Defendants committed unfair and deceptive acts and practices in violation of the CSPA by utilizing advertisements, postcards, and a website that notified consumers that they had won or were eligible to win a prize, free trip, or were eligible to receive something of value when receipt was conditioned on the payment of a deposit, service charge, or other charge or without clearly and conspicuously disclosing that, to receive the thing of value, the consumers would be required to listen to a sales presentation in violation of OAC 109:4-3-06, without clearly and conspicuously stating all material exclusions, reservations, limitations, modifications, or conditions to the offer in violation of OAC 109:4-3-02, or that contained a written description of the prize or thing of value which conveyed a misleading impression regarding the true nature, size, quality, or value of the item.  Defendants committed unconscionable acts and practices in violation of the CSPA by entering into consumer transactions knowing of the inability of consumers to receive a substantial benefit from the subject of the transaction.  Defendants committed unfair and deceptive acts and practices in violation of the CSPA by: 1) representing that the subject of the consumer transaction had sponsorship, approval, performance characteristics, accessories, uses, or benefits that it did not have, 2) representing that the subject of the transaction was of a particular standard, quality, grade, style, prescription, or model, when it was not, 3) failing to deliver goods or services in the promised time frame and failing to make full refunds.  Defendants ordered to pay $18,253.00 in consumer restitution and $100,000.00 in civil penalties.

In re Potbelly Sandwich Works, LLC, AVC, PIF 2812

Supplier agrees to comply with the CSPA, including but not limited to, OAC 109:4-3-02, 109:4-3-03, 109:4-3-04, and 109:4-3-06.