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Deceptive Marketing Enjoined By Judge

A software vendor offered “free” CDs to consumers for the cost of shipping and handling ($1.99 to 2.99). However, the fine print required the consumers to return half of the CDs within 10 days or their credit cards would be charged $39 to $49.

The feds stepped in and obtained a temporary injunction in federal district court.

There is apparently no working phone number for this “business” and the website is currently down. 

Note that this type of conduct typically gives rise to claims under state deceptive trade practice laws where remedies can include treble damages, punitive damages, attorney fees, etc.

Moral of the story… 

Don’t play cute with the consumer. Even if they love your product or service, no one appreciates being deceived. 

This applies to more than software. If you’re selling widgets with “free” XX, there shouldn’t be hidden charges or penalties unless you enjoy paying lawyers to fight the Federal Trade Commission, your state’s Attorney General, and/or a plaintiff’s lawyer that wants to buy a vacation home using the money he will earn suing you on behalf of consumers.

Hat tip to the Dallas Morning News.

Mike Young, Esq.

Author Mike Young, Esq.

Mike Young has been practicing business and technology law since 1994 and is an angel investor in startups. He's been an entrepreneur since 1988. To get legal help from Attorney Young, click here now or call 214-546-4247 to schedule a phone consultation.

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