TurboTax, Intuit, Inc.
Our Office was part of a multi-state settlement that required Intuit, Inc. (Intuit), the owner of TurboTax, to pay $141 million in restitution to millions of consumers across the nation who were deceived into paying for free tax services. Additionally, Intuit must suspend TurboTax’s “free, free, free” ad campaign that lured customers with promises of free tax preparation services, only to deceive them into paying for services.
An investigation into Intuit began after ProPublica reported that the company was using deceptive digital tactics to steer low-income consumers toward its commercial products and away from federally-supported free tax services.
Intuit had offered two free versions of TurboTax. One was through its participation in the IRS Free File Program, a public-private partnership with the Internal Revenue Service (IRS), which allows taxpayers earning roughly $34,000 and members of the military to file their taxes for free. In exchange for participating in the program, the IRS agreed not to compete with Intuit and other tax-prep companies by providing its own electronic tax preparation and filing services to American taxpayers.
In addition, Intuit offered a commercial product called “TurboTax Free Edition,” which was only free for taxpayers with “simple returns” as defined by Intuit. In recent years, TurboTax has marketed this “freemium” product aggressively, including through ad campaigns where “free” is the most prominent, or sometimes the only, selling point. In some ads, the company repeated the word “free” dozens of times in as few as 30 seconds. However, the TurboTax “freemium” product is only free for approximately one-third of US taxpayers. In contrast, the IRS Free File product was free for 70 percent of taxpayers.
The multistate investigation found that Intuit engaged in several deceptive and unfair trade practices that limited consumers’ participation in the IRS Free File Program. The company used confusingly similar names for both its IRS Free File product and its commercial “freemium” product. Intuit bid on paid search advertisements to direct consumers who were looking for the IRS Free File product to the TurboTax “freemium” product instead. Intuit also purposefully blocked its IRS Free File landing page from search engine results during the 2019 tax filing season, effectively shutting out eligible taxpayers from filing their taxes for free. Moreover, TurboTax’s website included a “Products and Pricing” page that stated it would “recommend the right tax solution,” but never displayed or recommended the IRS Free File program, even when consumers were ineligible for the “freemium” product.
Intuit will pay $141 million in restitution, of which roughly $2.5 million will be used for administrative fund costs. Under the agreement, Intuit will also provide restitution to millions of consumers who started using TurboTax’s Free Edition for tax years 2016 through 2018 and were told that they had to pay to file even though they were eligible to file for free using the version of TurboTax offered as part of the IRS Free File program.
Approximately 134,000 Georgia consumers who were deceived into paying for free tax services will receive over $4 million dollars in refunds from Intuit under this settlement.
Georgia was one of 40 states to join a $391.5 million multistate settlement with Google over its location tracking practices. This is the largest multistate privacy settlement reached by a coalition of Attorneys General in the history of the United States.
Location data is a key part of Google’s digital advertising business. Google uses the personal and behavioral data it collects to build detailed user profiles and target ads on behalf of its advertising customers. Location data is among the most sensitive and valuable personal information Google collects. Even a limited amount of location data can expose a person’s identity and routines and can be used to infer personal details.
The Attorneys General opened the Google investigation following a 2018 article from the Associated Press that revealed Google “records your movements even when you explicitly tell it not to.” The article focused on two Google account settings: Location History and Web & App Activity. Location History is “off” unless a user turns on the setting. Web & App Activity, a separate account setting, is automatically “on” when users set up a Google account, including all Android phone users.
As detailed in the settlement, the Attorneys General found that Google violated state consumer protection laws by misleading consumers about its location tracking practices since at least 2014. Specifically, Google caused users to be confused about the scope of the Location History setting, the fact that the Web & App Activity setting existed and also collected location information, and the extent to which consumers who use Google products and services could limit Google’s location tracking by adjusting their account and device settings.
The settlement required Google to be more transparent with consumers about its practices. Google must:
- Show additional information to users whenever they turn a location-related account setting “on” or “off”;
- Make key information about location tracking unavoidable for users (i.e., not hidden); and
- Give users detailed information about the types of location data Google collects and how it’s used at an enhanced “Location Technologies” webpage.
The settlement also limits Google’s use and storage of certain types of location information and required Google account controls to be more user-friendly.
The State of Georgia will receive more than $12.4 million from this settlement.
Google, LLC and iHeartMedia, Inc.
Our office, along with the Federal Trade Commission (FTC) and five other impacted states, settled with Google, LLC and iHeartMedia, Inc. to resolve an investigation into an alleged deceptive ad campaign involving allegedly false endorsements of the Google Pixel 4 smartphone.
The Complaint alleges that in 2019, Google contracted for iHeartMedia to record advertisements endorsing Google’s Pixel 4 smartphone for airing in particular media markets across the country, including Atlanta, Georgia. These ads, which ran on certain iHeartMedia radio stations and internet streaming services, are alleged to have included false claims regarding the supposed personal experiences of purported users. However, these purported users had never actually owned or operated a Pixel 4 smartphone prior to making their endorsements.
Google allegedly hired iHeartMedia to have the people in the ads use scripts that described their supposed personal experiences using the Pixel 4, despite the phone not yet being available for sale. Google also refused to provide the phones to those making their endorsements in advance of initially recording and airing the ads in 10 media markets–-Atlanta, Boston, Chicago, Dallas/Ft. Worth, Denver/Boulder, Houston, Los Angeles, New York, Phoenix, and San Francisco/Bay Area. These false ads aired 1,169 times in Georgia, including four ads aired on iHeartMedia radio stations in the Atlanta media market. The Complaint alleged that the ad campaign violated the Fair Business Practices Act, as it deceived consumers about the endorser’s actual experience using the product.
Under the terms of the settlements, both Google and iHeartMedia will jointly pay a total of $9.4 million to the impacted states, comply with the FTC’s Guides Concerning the Use of Endorsements and Testimonials in Advertising, and refrain from misrepresentations about an endorser’s experience.
Over $1.17 million of the penalty will be paid to the State of Georgia.
The Georgia Attorney General’s Office co-led the investigation, along with Massachusetts Attorney General Maura Healey.
The Attorney General’s Office obtained a Judgment against Marvelay, LLC, operating under the names “Spot Reservation” and “Rushcube,” for allegedly defrauding consumers through misleading internet advertising and unfair and deceptive sales practices. The company operates through numerous websites, representing themselves as different companies that provide a variety of recreational activities at locations across the Unites States, such as sky diving, hot air balloon rides, helicopter tours and airplane flight lessons. Our office alleged that the companies named on the websites did not really exist and that the company’s representatives themselves were not activity providers; rather, they sold events to consumers and then proceeded to book those events through third-party vendors.
Attorney General Carr alleged that consumers believed they were dealing with the companies that actually provided the activities when they purchased an adventure product from the company. In addition, he alleged that the company:
- Accepted payments from consumers but did not secure reservations for the activity that was purchased;
- Confirmed reservations and accepted payment for activities that were to occur at a specific day and time, when the actual vendor did not have an opening for that day and time;
- Advertised that activities were available in specific cities or locations, when they were not—consumers would have to traveled for hours to participate in the activity they purchased; and
- Was unresponsive or unable to provide new reservations or provide the paid-for service, when third-party vendors cancelled reservations due to weather.
The Judgment permanently restrains and enjoins the company from future violations of Georgia’s Fair Business Practices Act and requires it to pay civil penalties and fees in the amount of $250,000. The company is also prohibited from publishing false or deceptive reviews and from using deceptive representations or designations of geographic origin. In addition, the company is permanently banned from advertising and/or selling any reservation, offer or purported offer to make a reservation with a third-party vendor who will provide or perform any sport or adventure activity undertaken for the purpose of recreation, enjoyment, pleasure or leisure.
CA Certificate Service, LLC d/b/a GA Certificate Service, and James Beard, individually (collectively “CCS”)
Our office alleged that CCS sent out deceptive direct mail solicitations offering to assist businesses in obtaining a Certificate of Existence. Specifically, this office alleged that CCS falsely represented that the fee it charged was a government fee, when, in fact, the company had (and has) no affiliation with the Georgia Secretary of State or any other government agency. It was further alleged that CCS misrepresented its location by listing a Georgia address when it actually operates from the State of Florida.
What’s more, while CCS charges $72.50 for completing the paperwork to obtain a Certificate of Existence, businesses can easily obtain a Certificate of Existence directly from the Georgia Secretary of State’s Office for a mere $10.
It should also be noted that new domestic Georgia business formations do not actually need Certificates of Existence to complete the business registration process, according to the Secretary of State’s website.
In resolution of these allegations, CCS entered into a settlement with our office requiring it to:
- Fully comply with the Fair Business Practices Act;
- Clearly and conspicuously disclose the purpose and amount of all fees, including distinguishing between fees paid to the Secretary of State’s Office and fees paid to CCS for its assistance in obtaining the record from the Secretary of State’s Office;
- Clearly and conspicuously disclose that that the company is not a government entity, is not affiliated with the government, and that the business may obtain a Certificate of Existence directly from the Secretary of State’s Office for $10;
- Keep in place a policy under which the company will refund its service fee to any customer who complains that it only paid the company due to the alleged conduct; and
- Immediately pay $25,000 in civil penalties, plus another substantial penalty if CCS fails to fully comply with the settlement terms in full during a two-year monitoring period.
Carnival Cruise Line
The Georgia Attorney General’s Office, along with 45 other Attorneys General obtained a $1.25 million multistate settlement with Florida-based Carnival Cruise Line stemming from a 2019 data breach that involved the personal information of approximately 180,000 Carnival employees and customers nationwide. The State of Georgia is positioned to receive $29,399.10 from the settlement.
In March 2020, Carnival publicly reported a data breach in which an unauthorized individual gained access to certain Carnival employee e-mail accounts. The breach included names, addresses, passport numbers, driver’s license numbers, payment card information, health information and a relatively small number of Social Security Numbers. In total, 3,887 Georgians were impacted.
Breach notifications sent to Attorneys General offices stated that Carnival first became aware of suspicious email activity in late May of 2019 – approximately 10 months before Carnival reported the breach. A multistate investigation ensued, focused specifically on Carnival’s email security practices and compliance with state breach notification statutes.
“Unstructured” data breaches like the Carnival breach involve personal information stored via email and other disorganized platforms. Businesses lack visibility into this data, making breach notification all the more challenging – and consumer risk rises with delays.
Under the settlement, Carnival agreed to a series of provisions designed to strengthen its email security and breach response practices moving forward. The provisions included:
- Implementation and maintenance of a breach response and notification plan;
- Email security training requirements for employees, including dedicated phishing exercises;
- Multi-factor authentication for remote email access;
- Password policies and procedures requiring the use of strong and complex passwords, password rotation, and secure password storage;
- Maintenance of enhanced behavior analytics tools to log and monitor potential security events on the company’s network; and
- Consistent with past data breach settlements, undergoing an independent information security assessment.
Evergreen Publishing Group LLC, Readers Services, Inc. and Chris Sidhilall, individually (“Evergreen”)
Evergreen entered into a settlement with our office to resolve allegations that the companies, which are no longer in business, engaged in illegal and deceptive telemarketing activities in the course of selling magazine subscriptions to older and disabled adults.
Mr. Sidhilall previously owned and operated America’s Choice Publishers, which entered into a settlement with the Governor’s Office of Consumer Protection (as we were formerly known) to resolve similar allegations.
Evergreen Publishing Group, Readers Services and Mr. Sidhilall allegedly committed multiple violations of Georgia’s Fair Business Practices Act, including:
- Collecting, or attempting to collect, payment for goods or services without customers’ express verifiable authorization;
- Representing or implying that they were associated with magazines to which consumers are currently subscribed and/or that they are calling to renew consumers’ current magazine subscriptions, when, in fact, there was no such association and the purpose of the call was to solicit new magazine subscription sales; and
- Representing that they were conducting a promotion in which consumers were entering a sweepstakes, and inducing consumers to purchase magazines based on these representations, when, in fact, no sweepstakes were held, and no prizes were awarded.
In resolution of these allegations, the companies and Mr. Sidhilall entered into a settlement in which they agreed to:
- Cease and refrain from engaging in telemarketing;
- Cease and refrain from attempting to collect any payments from consumers and notify consumers currently engaged in contracts with the companies that the contracts are cancelled without penalty to the consumers;
- Cease and refrain from attempting to collect past due amounts from consumers; and
- Cease collection on, reduce to a zero balance, and turn over to this office all Georgia consumer accounts the companies own, amounting to a contract value of at least $94,533.90.
The settlement also required that the companies and Mr. Sidhilall pay $15,000 for a restitution account to be administered by the Consumer Protection Division and $135,000 to be used for purposes that may include, but are not limited to, civil penalties, attorneys’ fees, investigation and litigation costs, future consumer protection or privacy enforcement, and consumer education. Should the companies fail to fully comply with the settlement during a five-year monitoring period, they will be required to pay an additional civil penalty to the state.
LoadUS Foundation, Inc.
This company, which has received 501(c)(3) status from the IRS, primarily markets itself as a crowdfunding tool with a stated goal of assisting individuals during the course of the pandemic. The company’s organizer is also the principal officer of LoadUS, LLC and LoadUS Enterprises, LLC, which are related entities.
Through Loadus’ website (and soon, according to marketing, its own mobile app), users can purchase a monthly or yearly subscription, which grants them a membership and access to funding campaigns. “Funding” is undefined in Loadus’ marketing, but apparently encompasses everything from help with medical bills to requesting seed money for a new company. These funding campaigns were advertised as 501(c)(3) tax deductible donations under the Loadus Foundation banner.
Our office alleged that Loadus’ administration of its 501(c)(3) was unfair and deceptive because it did not clearly disclose to consumers the nature and route of their “donations.” In addition, the company allegedly violated the Fair Business Practices Act by claiming that income from the crowdfunding campaigns is not taxable; claiming that Loadus can charge fees as a 501(c)(3) and use those fees “at any time for any purpose”; and offering a “benefits package” that includes healthcare.
In resolution of these allegations, the company entered into a settlement with our office which required it to pay $10,000 in civil penalties. It also must modify its disclosures, including, among other things, clearly and conspicuously disclosing whether consumers are making a tax-free gift to a 501(c)(3) entity or paying for non-tax-free services offered by Loadus’ affiliates. Should Loadus violate the terms of the settlement during a monitoring period, an additional penalty will be assessed.
Reed Hein and Associates, LLC, d/b/a Timeshare Exit Team
Reed Hein advertised and offered “timeshare exit” or timeshare cancellation services to consumers. Our investigation revealed that despite claiming to have the necessary knowledge and skill to negotiate consumers’ exits from timeshare contracts, it often used outside vendors, including lawyers and law firms, to handle the timeshare “exits”. Consumers complained that Reed Hein was hired to negotiate consumers’ “exits” from their timeshare contracts but failed to deliver results after receiving payment of thousands of dollars from the consumers.
For many years Reed Hein advertised a “100% success rate,” a claim that appeared to be false when reviewing the large numbers of consumer complaints, several of which were from consumers who had foreclosure actions taken against them after they had hired Reed Hein. While the “100% success rate” was no longer advertised by the time our office initiated its investigation, Reed Hein still claimed a “money-back guarantee” to consumers who were not 100% satisfied. Consumers report that they had not been able to receive that refund based on technicalities or repeated delays.
The company entered into a settlement requiring it to pay restitution to Georgia consumers in the amount of $56,390.94. The company also agreed to shut down its business in the State of Georgia. The company is also prohibited from advertising or conducting any business in the State of Georgia or with any residents of the State of Georgia except for contracts or agreements with Georgia consumers entered before the execution of the settlement.
Listed below are some of the recent achievements for the Georgia Attorney General's Consumer Protection Division (CPD).
Civil Investigations Accomplishments - 2022
Unfair and Deceptive Practices
The Georgia Attorney General’s Office joined a multistate settlement agreement recovering $34.2 million for more than 46,000 U.S. service members and veterans who were deceived and defrauded by national jewelry retailer Harris Jewelry. The multistate settlement agreement required that Harris Jewelry:
- Vacate judgments against 112 consumers totaling $115,335.64 and delete any negative credit entries reported to consumer reporting agencies;
- Stop collecting $21,307,229 in outstanding debt that is held by 13,426 service members. This forbearance includes $1,935,231.56 in outstanding debt for 1,206 Georgia service members; and
- Provide up to $12,872,493 in refunds to 46,204 service members who paid for protection plans, including $978,097.81 for 3,711 Georgia service members.
Harris Jewelry, headquartered in Hauppauge, New York, operated retail stores near and on military bases around the country. Its business model was designed to primarily target and service people in the military. The multistate investigation found that local service members were enticed into retail stores through a marketing scheme in which Harris Jewelry advertised teddy bears in military uniforms with promises of charitable donations. The investigation found that no legal contract was actually signed between Harris Jewelry and the charity it claimed to support. Moreover, consumers were often given varying and conflicting information about the amount donated to the charity. Sometimes they were told all the proceeds would be donated, and other times they were told only a portion would be donated.
In addition, Harris Jewelry offered service members predatory lending contracts that were marketed to them as a way to build or improve their credit scores. The credit advanced to service members through the Harris Program was not based on a consumer’s credit score, potential income or other legitimate factors that banks consider. Rather, it was based on a service member’s branch of service, the amount of time they had remaining on their term of enlistment, and the category of merchandise they purchased. Service members were led to believe that they were investing in the Harris Program and that the jewelry they purchased was a gift from Harris Jewelry.
The jewelry itself was significantly overpriced and of poor quality. The investigation found that the company dramatically inflated the retail price of its products, generally by multiplying its wholesale cost by six or seven times, and in some cases ten times the wholesale cost. For example, Harris Jewelry purchased its popular Mother’s Medal of Honor for $77.70 but sold it at $799. The jewelry was not worth the price and consumers often reported stones falling out, chains breaking and the finish fading.
Harris offered service members protection plans on the jewelry, which they claimed were optional but were added to nearly all eligible transactions without the service member’s knowledge. The costs of the protection plans ranged from $39.99 to $349.99, depending on the retail price of the item. In some instances, the cost of the protection plan exceeded the wholesale cost Harris paid for the item. Protection plans were added to a consumer’s retail installment contract as a routine practice without disclosure to the consumer.
According to the consent order, Harris Jewelry violated the Federal Trade Commission Act, the Truth-in-Lending Act, the Electronic Fund Transfer Act, the Military Lending Act, the Holder Rule, and state laws in connection with jewelry sales and financing to members of the military.
Joining our office in resolving this matter were the Federal Trade Commission and the Attorneys General of California, Connecticut, Delaware, Florida, Hawaii, Idaho, Illinois, Iowa, Kansas, Louisiana, Maryland, Nevada, New York, North Carolina, Pennsylvania, Virginia and Washington.
Inhouse Brand Group, LLC d/b/a Historically Black Apparel, and Anthony R. Smith II, individually (“HBA”)
This company sells pro-black merchandise and apparel. Our office alleged that HBA violated the Fair Business Practices Act (FBPA) and the FTC’s Mail Order Rule by offering various products for sale in exchange for money, then either failing to provide the products ordered, failing to provide a refund to the consumer, or failing to provide the products within the timeframe represented. HBA also allegedly misled consumers by inflating consumer interest in its apparel on its website. Finally, HBA allegedly misled consumers by creating a false sense of urgency about discounts through a daily countdown feature on its website that represented a sale that continued past the represented time.
The parties entered into a settlement, which required them to come into compliance with the FBPA and the Mail Order Rule, and to warrant that consumers who have complained to our office or the Better Business Bureau are either refunded or that their orders were fulfilled. The parties also paid a civil penalty to the State of Georgia.
The Pup Collection, LLC d/b/a PupSocks and Zach Zelner, individually (collectively “PupSocks”)
PupSocks offers customizable items, such as socks and blankets with images of pets on them. Our office had previously entered into a settlement with PupSocks in 2019 regarding order fulfillment, delay notification, and refund issues. Consumer complaints again increased during the 2021 holiday season and a second investigation into the business practices of PupSocks occurred.
It was alleged that PupSocks violated the Fair Business Practices Act by representing that ordered goods would be shipped within a certain timeframe, failing to ship them within the timeframe represented, and failing to notify and offer full refunds to consumers whose goods were not ready to be shipped in the timeframe represented. PupSocks’ policy was to retain a $9/item customization fee for orders that were cancelled more than three hours after purchase. This policy applied even for orders consumers sought to cancel due to PupSocks’ failure to ship within the timeframe they represented. PupSocks has since agreed to stop collecting such a customization fee.
The company entered into a settlement that requires strict compliance with the FTC’s Mail, Internet, or Telephone Order Merchandise Rule, which Georgia has adopted. Respondents are also required to provide quarterly reports to the Department of Law, Consumer Protection Division over the next year, and pay $25,000 in civil penalties. If violations of the settlement terms occur between the date of execution and November 2023, additional substantial penalties will be assessed.
Rent-A-Center East, Inc. (“Rent-A-Center”)
Our office entered into a settlement with Rent-A-Center, resolving allegations that the company engaged in deceptive sales and marketing tactics and violated the Fair Business Practices Act (FBPA) in the course of its rent-to-own sales of furniture, electronics and appliances. The settlement required Rent-A-Center to:
- Bring its advertising, sales and marketing practices into full compliance with the FBPA and the Georgia Lease-purchase Agreement Act;
- Refrain from harassment and other unlawful debt collection practices;
- Verify that any debt owed is accurate before sending it to a third-party for debt collection; and
- Pay $145,590 in civil penalties with an additional penalty to be assessed if the business violates any terms of the settlement.
FactoryOutletStore, LLC and GoGoTech II LLC, collectively d/b/a FactoryOutletStore.com
FactoryOutletStore.com, entered into an agreement with our office in response to allegations that the companies violated the Fair Business Practices Act (“FBPA”) and the Mail Order Rule by offering various products for sale and then failing to deliver the products within the promised timeframe; failing to clearly and conspicuously disclose their complete return policies; and creating a false sense of urgency and/or misrepresenting discounts. The companies have agreed to comply with the FBPA and Mail Order Rule going forward; to pay refund consumers for restocking fees in the amount of $41,425.38; and to pay $7,500.00 in fees and penalties to the Attorney General’s Office.
Window World of North Atlanta, Inc. (“Window World”)
Window World offers window and door installation products and services. The Attorney General’s investigation revealed that the company represented to consumers that installations would be performed during certain timeframes but then failed to install the products in that promised timeframe. What’s more, when it did not install the products when promised, the company allegedly failed to offer refunds to consumers.
To resolve these allegations, the company entered into a settlement which prohibits future violations of the Fair Business Practices Act and related laws. The agreement also required Window World to cease specific unlawful conduct regarding the misrepresentation of installation timelines and to clearly and conspicuously disclose cancellation and refund policies when installation timeframes cannot be met. In addition, the company was assessed a $16,000 civil penalty.
Medical – Marketing, Advertising and Sales Practices
Cardinal, McKesson, AmerisourceBergen and Johnson & Johnson
Attorney General Carr signed on to the $26 billion multi-state agreement with Cardinal, McKesson and AmerisourceBergen – the nation’s three major pharmaceutical distributors – and opioid manufacturer and marketer Johnson & Johnson. The settlement agreement resolved investigations and litigation over the companies’ roles in creating and fueling the opioid epidemic, particularly as to whether the three distributors fulfilled their legal duty to refuse to ship opioids to pharmacies that submitted suspicious drug orders and whether Johnson & Johnson misled patients and doctors about the addictive nature of opioid drugs.
The settlement required the companies to provide substantial funding for opioid treatment and prevention and to implement significant industry changes that will help to prevent this type of crisis from ever happening again.
Georgia and its local county and municipal governments stand to receive approximately $636 million under the settlement agreement. Georgia’s share of the settlement will be distributed among the state and local governments pursuant to a Memorandum of Agreement, to which the state and local governments have already agreed.
The Georgia Attorney General’s Office was one of 35 states and territories to join a $438.5 million agreement in principle with JUUL Labs (“JUUL”), resolving a two-year bipartisan investigation into the e-cigarette manufacturer’s marketing and sales practices.
JUUL was, until recently, the dominant player in the vaping market. The multistate investigation revealed that JUUL rose to this position by willfully engaging in an advertising campaign that appealed to youth, even though its e-cigarettes are both illegal for them to purchase and are unhealthy for youth to use. The investigation found that JUUL relentlessly marketed to underage users with launch parties, advertisements using young and trendy-looking models, social media posts and free samples. It marketed a technology-focused, sleek design that could be easily concealed and sold its product in flavors known to be attractive to underage users. JUUL also manipulated the chemical composition of its product to make the vapor less harsh on the throats of young and inexperienced users. To preserve its young customer base, JUUL relied on age verification techniques that it knew were ineffective.
The investigation further revealed that JUUL’s original packaging was misleading in that it did not clearly disclose that it contained nicotine and implied that it contained a lower concentration of nicotine than it actually did. Consumers were also misled to believe that consuming one JUUL pod was the equivalent of smoking one pack of combustible cigarettes. The company also misrepresented that its product was a smoking cessation device without FDA approval to make such claims.
The settlement forces JUUL to comply with a series of strict injunctive terms severely limiting the company's marketing and sales practices. JUUL has agreed to refrain from youth marketing; depicting persons under age 35 in any marketing; use of cartoons; paid product placement; sale of brand name merchandise; sale of flavors not approved by FDA; allowing access to websites without age verification on landing page; representations about nicotine not approved by FDA; misleading representations about nicotine content; sponsorships/naming rights; advertising in outlets unless 85 percent audience is adult; advertising on billboards; public transportation advertising; social media advertising (other than testimonials by individuals over the age of 35, with no health claims); funding education programs; use of paid influencers; direct-to-consumer ads unless age-verified; and free samples. The agreement also includes sales and distribution restrictions, including where the product may be displayed/accessed in stores, online sales limits, retail sales limits, age verification on all sales, and a retail compliance check protocol.
The $438.5 million penalty will be paid out over a period of six to 10 years, with the amounts paid increasing the longer the company takes to make the payments. If JUUL chooses to extend the payment period up to 10 years, the final settlement would reach $476.6 million. Both the financial and injunctive terms exceed any prior agreement JUUL has reached with states to date.
Under the settlement, more than $19 million is expected to be received by the State of Georgia.
Hair Restoration Specialists, Inc. d/b/a Hair Restoration Specialists of Atlanta (“HRS”)
HRS offered and widely advertised a treatment it called “Adi-Stem Infusion” to cure, treat or mitigate hair loss conditions. The Attorney General’s office alleged that HRS made false or unsubstantiated claims about this treatment, including that it contained hundreds of thousands of adult stem cells; will grow hair and/or stimulate hair growth; and that it is “the most advanced treatment available to reverse thinning hair.”
HRS entered into a settlement with our office, which prohibits it from making representations about any stem cell product that is not substantiated by competent and reliable scientific evidence. In addition, the company paid $341,000 in customer restitution and a $50,000 civil penalty.
Atlanta Medical Care, P.C., Atlanta Gross Medical Care, P.C., MG Capital Group, Inc., and My Goals Solutions, Inc. (collectively “Goals”)
Goals advertises and performs various cosmetic procedures. Attorney General Carr alleged that after consumers incurred a financial obligation with the business, Goals changed material terms of the contract, including the date of the procedure, price, type of procedure, and medical provider without the consumer’s consent and without allowing the consumer an opportunity to obtain a refund. Besides allegedly failing to adequately disclose its refund, cancellation and rescheduling policies to consumers, Goals allegedly overbooked medical procedures and routinely required consumers to reschedule those procedures without their consent and without allowing for a refund. Carr alleged that these actions often caused consumers, many of whom lived out of state, to incur out-of-pocket losses and rendered them unable to schedule necessary post-operative appointments and treatments.
Our investigation also revealed that Goals’ contracts include several provisions that unlawfully prohibited or restricted a consumer’s ability to communicate a review, assessment, or similar analysis of the business’s services and conduct.
In resolution of these allegations, Goals entered into a settlement in which it agreed to
- Fully comply with the Fair Business Practices Act;
- Pay restitution in the amount $58,455.11, and
- Pay $59,740 in penalties and fees to the State. If the company violates any terms of the settlement, an additional penalty will immediately become due.
Ford Motor Company
Attorney General Carr, along with Attorneys General from 40 other offices and jurisdictions, joined a $19.2 million multistate settlement with Ford Motor Company, resolving allegations that Ford falsely advertised the real-world fuel economy of model year 2013-2014 C-Max hybrids and the payload capacity of model year 2011-2014 Super Duty pickup trucks. The multistate investigation revealed that Ford made several misleading representations about 2013-2014 C-Max hybrids, including:
- Misrepresenting the distance consumers could drive on one tank of gas;
- Marketing that driving style would not impact real-world fuel economy; and
- Claiming superior real-world fuel economy compared to other hybrids.
The C-Max hybrid was initially promoted as 47 mpg in the city and highway. Ford had to lower the vehicle’s fuel economy rating once in 2013 and again in 2014, to eventually 42 mpg/city, 37 mpg/highway and 40 mpg/city-highway mixed, impacting the 2013 (twice) and 2014 C-Max hybrid.
The Attorneys General also investigated Ford’s misleading “Best-in-Class” payload claims on its 2011-2014 Super Duty pick-up trucks, which include the F-250, F-350 and F-450 models – a line that caters to consumers hauling and towing heavy loads. The Attorneys General alleged that Ford’s methodology to calculate maximum payload capacity for advertising purposes was based on a hypothetical truck configuration that omitted standard items such as the spare wheel, the tire and jack, the center flow console (replacing it with a mini console) and the radio. Although advertised as available to all customers, only fleet customers could order the special configuration.
As part of the settlement agreement, Georgia received $370,706.64.
Mavis Tire Supply, LLC (“Mavis”)
Mavis entered into a settlement with our office, resolving allegations that the company, which has over 50 locations in Georgia alone, engaged in unlawful and deceptive sales practices in the course of its vehicle repairs and sales of automotive parts.
It was alleged that Mavis representatives informed consumers that their vehicles needed expensive repairs and/or parts, when such was not the case. Additionally, the company allegedly represented that vehicle parts were new, when they were actually used and/or not of the standard or model promised or required for the vehicle. Consumers also complained that the business did poor or incomplete work, which sometimes worsened or caused new problems to consumers’ vehicles. Mavis then allegedly failed to resolve those problems, despite having promised to either perform additional work or provide refunds. Some consumers even complained that employees of the company often suggested additional expensive procedures to fix the very problems allegedly created by Mavis.
In resolution of these allegations, Mavis entered into a settlement requiring it to:
- Pay restitution in the amount of $15,804.63 to identified consumers;
- Pay an additional $80,000 into a consumer claim fund for non-identified consumers who suffered damage as a result of the company’s alleged deceptive acts; and
- Implement remedial measures to ensure that the company is in compliance with the Fair Business Practices Act.
The company must also pay $150,000 to the State in civil penalties. An additional $50,000 penalty will be assessed if the company violates any terms of the settlement between now and December 31, 2024.
Avis Car Sales, LLC d/b/a Avis Car Sales Morrow (“Avis”)
In Georgia, dealers must apply for title within 30 days of sale. Our office alleged that Avis failed to timely apply for title for all consumers over an extended period of time, resulting in certain consumers being unable to legally operate their vehicles once the temporary tags had expired. Our office further alleged that the dealership expressly represented in certain circumstances that it would apply for title within a certain time period and failed to do so. What’s more, consumers complained that they had difficulty contacting the dealer to determine the status of vehicle titles during this specified time period.
Avis entered into a settlement with the Attorney General’s office requiring it to submit properly completed certificate of title applications and supporting documentation to the Commissioner or authorized county tag agent within the requisite 30 days and to pay $50,000 to the State of Georgia as a penalty.
CarMax Auto Superstores, Inc.
The Georgia Attorney General, along with 35 other state Attorneys General, were part of a $1 million multistate settlement with CarMax Auto Superstores, Inc. The settlement will require CarMax to disclose to potential purchasers open (unrepaired) recalls related to the safety of its used vehicles. This industry-changing settlement establishes that used car dealers should generally disclose open safety recalls to consumers before they buy a vehicle. CarMax now includes hyperlinks for vehicles advertised online and QR codes for vehicles on the lot that link directly to any open recalls on the vehicle so consumers can access this data as they shop. CarMax will also present the consumer with copies of any open recalls and obtain the consumer’s signature on a standalone disclosure document before presenting any other sales paperwork. Additionally, CarMax agrees to not represent vehicles as “safe.” Georgia will receive approximately $30,000 from the settlement.
Enrique Delgado d/b/a MakeMyTrailer.com and Plain Ol’ Trailers (collectively “MakeMy Trailer”)
Delgado operates these businesses as online retailers of cargo trailers. Our office alleged that Delgado, as sole owner and Chief Executive Officer of these business, failed to provide the trailers at the advertised and/or quoted prices, and misrepresented that the companies were the trailer manufacturer when, in fact, the trailers were actually manufactured by others. Delgado entered into a settlement requiring him, his employees, agents and representatives to:
- Comply with the Fair Business Practices Act;
- Refrain from advertising or quoting prices unless he intends to honor the advertised and/or quoted price;
- Clearly and conspicuously disclose whether a price is subject to change and the circumstances pursuant to which the price may change; and
- Refrain from stating or implying that he is the manufacturer of any product actually manufactured by others.
In addition, the company paid $2,000 in penalties. In the event that Delgado and his companies fail to comply with the settlement at any time during a two-year monitoring period, an additional penalty will become due.
MPRC Automotive, LLC d/b/a Grand Motorcars Marietta
The Attorney General’s Consumer Protection Division’s investigation of this dealership related to Grand Motor’s advertising practices – both the failure to sell vehicles at the advertised price and misrepresentations regarding the history of its advertised vehicles. For instance, the dealer allegedly failed on occasion to sell its vehicles at the advertised price by adding “required” add-ons such as vehicle service plans or exterior paint protection packages to the total price of the vehicle. Our office further alleged that Grand Motorcars was regularly misrepresenting the condition of its cars by making certain representations regarding the condition of its vehicles when, in fact, the dealership had no way of knowing if the representations were accurate. The dealer’s website automatically populated such representations as “no known mechanical issues” or “no known accidents” when all the dealer had done was engage in visual inspections of the vehicle. In addition, our office alleged that the dealer occasionally misrepresented its electronic titling fees by charging over $100 for electronic filing and representing that the fees were an “official government charge” when, in fact, only about $25 was remitted to a licensed Department of Revenue vendor, with the rest of the fee being pocketed by the dealer as a service charge.
The used motor vehicle dealer entered into a settlement with this office to pay a $20,000 civil penalty, correct its pricing advertising and to refrain from making unsubstantiated claims regarding vehicle history and condition.
Nissan of Newnan
Our office initiated an investigation of this franchise motor vehicle dealer after learning that it had likely violated a January 2020 settlement related to advertising misrepresentations. The settlement prohibited, among other things, representing that consumers could receive “up to” a certain amount of money in exchange for trade-in vehicles. Our 2022 investigation showed that in March 2021, Nissan of Newnan had disseminated a direct mail piece in violation of the 2020 settlement. Documents produced by the dealership demonstrated that of the few consumers that actually purchased vehicles during the sale and offered a trade-in, none received the highest “up to” amount.
Additionally, our investigation revealed a failure to honor advertised vehicle prices. A random sampling of deals over a multi-month period demonstrated that few consumers received the price at which the dealer was advertising the vehicle and that some paid thousands more than advertised in the form of inspection charges, added-on accessories, dealer fees and other charges. These practices, as well as those described related to the trade-in misrepresentations, violate the Fair Business Practices Act.
The dealership has subsequently agreed to modify its sales and advertising practices, and to pay a $30,000 penalty to the State.
North Georgia Auto Brokers, Inc. (“NGA”)
NGA is an independent car dealership operating in Snellville, Georgia. The investigation of this company revealed that the dealer had offered consumers limited service contracts, usually for about the first 3 months of car ownership, as part of their vehicle purchase. NGA offered these contracts, generally without additional payment from the consumer, and then, in order to activate them, was required to forward funds to the third-party contract provider. While it appears that the dealer generally forwarded funds on a timely basis, there was a certain group of consumers for whom the dealer failed to do so, effectively misrepresenting that these consumers have vehicle service coverage when they did not. A review of the dealer’s sales documents also revealed that certain consumers were assessed tag and title charges far beyond the amount collected by the Department of Revenue (DOR). For instance, certain fees were characterized as “state filing fees” for over $100 when the amount retained by the DOR is less than $10. In other instances, NGA assessed two separate fees related to tag/title for essentially the same service.
The dealership agreed to bring its practices into compliance with the law. NGA agreed to accurately designate fees in the future and ensure that it timely pays for any service contracts it provides to its customers.
The dealership paid $20,000 to the State.
TT of McDonough, Inc. d/b/a McDonough Nissan
Following the Consumer Protection Division’s investigation of this dealership, we alleged that for a significant portion of representative advertised vehicles, McDonough Nissan failed to honor its advertised prices. For instance, some consumers were required to pay reconditioning charges or paint protection packages that exceeded the advertised prices, sometimes by thousands of dollars. These types of charges, referred to as dealer add-ons or ADMs (additional dealer markups), are generally high-profit points for dealers and of limited value to consumers. These charges must be included in the advertised price, since Georgia law states that only government charges, (i.e. tax, tag, title and Lemon Law fees) may be excluded from the advertised vehicle price.
This office also alleged that the dealer sometimes misrepresented the fees it assessed for electronic titling services, charging some consumers over $100 for electronic filing and representing that the fees were an “official government charge” when, in fact, only about $25 was remitted to a licensed Department of Revenue vendor, with the rest of the fee being pocketed by the dealer as a service charge.
The dealer entered into a settlement in which it agreed to:
- Bring its advertising practices into compliance with the Fair Business Practices Act;
- Include its additional, required charges in its advertised prices;
- Accurately represent its titling and government charges; and
- Pay a $35,000 penalty to the State.
Credit, Debt and Loan Issues
Georgia joined 38 states in reaching a $1.85 billion nationwide settlement with Navient, one of the nation’s largest student loan servicers. The settlement resolves claims that since 2009, Navient steered struggling student loan borrowers into costly long-term forbearances instead of counseling them about the benefits of more affordable income-driven repayment plans. This, despite Navient representing that it would help borrowers find the best repayment options for them.
The settlement alleged that:
- The interest that accrued because of Navient’s forbearance steering practices was added to the borrowers’ loan balances, pushing borrowers further into debt. Had the company instead provided borrowers with the help it promised, borrowers could have benefited from income-driven repayment plans, interest subsidies, and/or help attaining forgiveness of any remaining balance after a proscribed number of years of qualifying payments; and
- Navient originated predatory subprime private loans to students attending for-profit schools and colleges with low graduation rates, even though it knew that a very high percentage of such borrowers would be unable to repay the loans; and
- Navient made these risky subprime loans as “an inducement to get schools to use Navient as a preferred lender” for highly-profitable federal and “prime” private loans.
The settlement required Navient to:
- Cancel the remaining balance on more than $1.7 billion in subprime private student loan balances owed by more than 66,000 borrowers nationwide;
- Pay $142.5 million to the Attorneys General involved in the action;
- Pay a total of $95 million in restitution payments to approximately 350,000 federal loan borrowers who were placed in certain types of long-term forbearances;
- Pay restitution, including over $5.9 million for 22,468 Georgia federal loan borrowers; and
- Cancel over $113 million in private loan debt owed by 4,268 Georgia borrowers.
Dream Center Education Holdings (Argosy University
Attorney General Carr, along with the Attorneys General of nine other states, joined a multistate settlement agreement with the entities controlling Argosy University student debt. Specifically, the entities have agreed to cancel the outstanding principal and interest for students who attended Argosy University in the years preceding its abrupt closure in 2019. This multistate deal also requires the cancellation of more than $150,000 in debt for students who attended Argosy’s Atlanta campus. In total, the agreement cancels nearly $2.1 million in “institutional debt” taken out by students at 12 campuses directly from the school. The agreement also prevents further collection and negative credit reporting against harmed students.
When Argosy was purchased by Dream Center Education Holdings in 2017, it allegedly falsely marketed to prospective students that it was a “nonprofit” institution. The owners also allegedly misled students about their ability to obtain degrees and provided misleading and incomplete information leading up to the school’s ultimate closure. The schools issued so-called “institutional loan debt” to students who were enrolled based on these marketing and recruitment practices.
Mismanagement by Dream Center ultimately led to insolvency and the closure of Argosy schools in 2019, which upended the lives of Argosy students in Georgia and across the country. The schools later entered federal receivership, a process similar to bankruptcy that can limit the financial relief available to students and other aggrieved creditors. Once in receivership, ownership of the institutional student debt changed hands. This agreement was secured with the entities that now control the debt.
Supremacy Financial Solutions, LLC (“SFS”)
SFS provides credit repair and tax preparation/filing services. Our office alleged that the company and its owner, Dwayne King, violated the Fair Business Practices Act by offering illegal credit repair services, including accepting payment in advance for services. Consumers also claimed the company educated people on how to start their own credit repair organization. The company and Mr. King entered into a settlement with the Attorney General’s office, in which they have agreed to:
- Cease all credit repair operations in Georgia and with Georgia consumers,
- Pay $44,889 in consumer restitution, and
- Pay a $15,000 civil penalty, with an additional civil penalty becoming due if any terms of the settlement are violated.
Excellent Credit Builders, LLC d/b/a Celebrity Credit Guru and d/b/a Credit Guru of Atlanta (collectively “Credit Guru”)
Our office obtained a Judgment in the amount of $2,683,700 against Credit Guru after it failed to comply with the terms of a Cease & Desist-Consumer Restitution-Civil Penalty Order, which was issued to resolve allegations that it offered unlawful credit repair services, made false and misleading statements to elicit business from consumers, and advised consumers to make false and misleading statements to credit reporting agencies to improve their credit rating.