The sellers of Girls Gone Wild videos and DVDs have agreed to settle unauthorized shipping and billing charges with the Federal Trade Commission, to the tune of $1.1 million.
That money will act as combined consumer redress and a civil penalty, the FTC said announcing the settlement, for Mantra Films failing to tell consumers clearly how their continuity programs ended up in monthly shipments of materials to customers who never agreed to receive them.
The FTC filed their complaint in late 2003, and a court order now bars the sellers from future activities involving failure to disclose how continuity programs work clearly, enrolling customers in the programs without their consent, and charging their credit or debit cards automatically without the customers' consent.
The FTC charged that Mantra and its sole stockholder Joseph Francis started enrolling consumers who answered Internet and television ads pushing single videos or DVDs into continuity programs beginning in December 2000.
"Once consumers were enrolled in these programs," the FTC said, "each month the defendants shipped additional, unordered videos and DVDs on a 'negative-option' basis, charging consumers’ credit and debit cards for each shipment until consumers took action to stop the shipments."
Mantra and Francis were charged with violating the FTC Act, the federal Electronic Fund Transfer Act, and the Unordered Merchandise Statute, not to mention previous FTC rulings against shipping unordered goods and trying to get payment for or return of those goods without the recipients' consent.
Under the settlement order, $548,392 of the total settlement will go to consumers put into the continuity programs without their consent from February 2002 through June 2003 but canceled enrollment when they returned the first monthly shipments for refunds and got no refunds, the FTC said. The rest of the settlement amount will pay a civil penalty, and Mantra will have 60 days from its July 30 signing to comply with the redress order.
