Lawsuit: States get $34 million.
The Associated Press
Publishers Clearing House agreed to pay $34 million in a deal with 26 states
Tuesday to settle allegations the sweepstakes company employed deceptive
As part of the settlement, the company will no longer use phrases like
This will in fact revolutionize the sweepstakes industry, said Michigan
Attorney General Jennifer Granholm.
Publishers Clearing House will have to pay $34 million in customer refunds,
legal expenses and administrative costs to the states.
We listened to the states concerns and have agreed to responsive and
significant changes that will make our promotions the clearest, most reliable
and trustworthy in the industry, said Robin Smith, chairman & CEO of the Port
Washington, N.Y.-based company.
In the lawsuits, state attorneys general had accused Publishers Clearing House
of deceptive marketing for its sweepstakes promotions. The suit alleged that
the company was misleading consumers by making them believe they had won
prizes or would win if they bought magazines from Publishers Clearing House.
Publishers Clearing House reached an $18 million settlement last August with
24 other states and the District of Columbia.
In 1999, another sweepstakes company, American Family Enterprises, settled a
group of lawsuits for $33 million.
That company is known for the American Family Publishers sweepstakes plugged
by Dick Clark and Ed McMahon.