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FTC Enforcement

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March 3, 2017

The FTC has approved a final order settling charges that OFTACOOP, a Puerto Rican ophthalmologist cooperative, unlawfully orchestrated an agreement among competing ophthalmologists to refuse to deal with a health plan, MCS Advantage, Inc., and its network administrator, Eye Management of Puerto Rico, LLC. First announced in January 2017, the complaint alleged that OFTACOOP’s concerted refusal to deal forced MCS to abandon its plan to engage Eye Management to create a lower-cost network of ophthalmologists. MCS was also forced to maintain its then-current reimbursement rates paid to ophthalmologists. According to the complaint, OFTACOOP – also known as Cooperativa de Médico Oftalmólogos de Puerto Rico – restrained competition without any justification, in violation of federal antitrust law.

February 23, 2017

The final defendant in an alleged mortgage relief scam that preyed upon distressed homeowners will be banned from selling mortgage or debt relief services under a settlement with the FTC. The settlement resolves FTC charges against Gabriel D. Stewart in a scheme that operated under the fictitious names “2Apply” and “UW Solutions.” The defendants falsely claimed they could lower consumers’ mortgage payments and interest rates or prevent foreclosure, pretended to be affiliated with a government agency or consumers’ lenders or servicers, and illegally charged advance fees. The case was brought in July 2014 as part of a federal-state law enforcement effort, Operation Mis-Modification.

February 22, 2017

Three U.S. companies have agreed to settle Federal Trade Commission charges that they deceived consumers about their participation in the Asia-Pacific Economic Cooperation (APEC) Cross-Border Privacy Rules (CBPR) system. In separate but similar complaints, the FTC charged that Sentinel Labs, Inc., which provides endpoint protection software to enterprise customers; SpyChatter, Inc., marketer of the SpyChatter private message app; and Vir2us, Inc., which distributes cyber security software; falsely represented in their online privacy policies that they participated in the APEC CBPR system.

February 10, 2017

The operators of two online “high schools” have agreed to settle FTC charges that they falsely claimed to be accredited schools but actually were little more than diploma mills that sold worthless pieces of paper. The settlements resolve charges the FTC brought in February 2016 against Capitol Network Distance Learning Programs and Stepping Stonez Development, LLC, two separate diploma mills that used names like Capitol High School, Aberdeen Academy, West Madison Falls High School, Columbia Northern High School, and Heritage Western High School. Under the terms of the settlements, the defendants are banned from marketing or selling any academic degree or certification programs. The orders also prohibit them from making misrepresentations about any product or service, including claims about the performance of any product or service, the use of testimonials, and accreditations or endorsements.

February 6, 2017

VIZIO, Inc., one of the world’s largest manufacturers and sellers of internet-connected “smart” televisions, has agreed to pay $2.2 million to settle charges by the FTC and the Office of the New Jersey Attorney General that it installed software on its TVs to collect viewing data on 11 million consumer TVs without consumers’ knowledge or consent. The stipulated federal court order requires VIZIO to prominently disclose and obtain affirmative express consent for its data collection and sharing practices, and prohibits misrepresentations about the privacy, security, or confidentiality of consumer information they collect. It also requires the company to delete data collected before March 1, 2016, and to implement a comprehensive data privacy program and biennial assessments of that program.

February 1, 2017

The FTC announced a settlement today that requires Volkswagen Group of America to fully compensate consumers who purchased 3.0-liter TDI diesel vehicles through a combination of repairs, additional monetary compensation, and buybacks for certain models. Under the federal court order, owners of older vehicles will be able to sell their car back to Volkswagen at favorable prices and obtain full compensation for their losses. Consumers are eligible to receive approximately $26,000 to $58,000 for a buyback, depending on the model, mileage, and trim of the car.

January 17, 2017

The FTC filed a complaint in federal district court charging Qualcomm Inc. with using anticompetitive tactics to maintain its monopoly in the supply of a key semiconductor device used in cell phones and other consumer products. Qualcomm is the world’s dominant supplier of baseband processors – devices that manage cellular communications in mobile products. The FTC alleges that Qualcomm has used its dominant position as a supplier of certain baseband processors to impose onerous and anticompetitive supply and licensing terms on cell phone manufacturers and to weaken competition.

January 13, 2017

The FTC today announced a crackdown on two massive robocall telemarketing operations, both of which have been blasting robocalls to consumers on the National Do Not Call Registry since at least 2012. Many of the defendants in the two cases, FTC v. Justin Ramsey, et al. and FTC v. Aaron Michael Jones, et al., have agreed to court orders that permanently ban them from making robocalls, making any calls to numbers listed on the Do Not Call Registry, violating the TSR, and/or assisting others in doing so. The settling defendants also will pay the Commission a total of more than $500,000.

January 10, 2017

The FTC is mailing checks to nearly 350,000 people who lost money running Herbalife businesses. The checks are the result of a July 2016 settlement with the FTC that required Herbalife to pay $200 million and fundamentally restructure its business. This represents one of the largest redress distributions the agency has made in any consumer protection action to date.

December 22, 2016

The defendants who operated a Florida-based tech support scheme that the FTC and State of Florida charged deceived thousands of consumers, will pay $10 million for consumer redress to settle the action. According to the complaint, defendant Inbound Call Experts, doing business as Advanced Tech Support along with other defendants, used high-pressure sales pitches to telemarket tech support products and services falsely claiming to find viruses and malware on consumers’ computers.
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