Antitrust Law Daily Wrap Up, CONSUMER PROTECTION NEWS: FTC Charges Company with Coercing Elderly Consumers into Paying for Medical Alert Services, (Mar 11, 2013)

By Tobias J. Gillett, J.D., LLM.

The FTC announced today that it filed a complaint in the federal district court in Brooklyn, New York, against Instant Response Systems, LLC alleging that the company employed deception, threats, and intimidation to coerce elderly consumers into paying for medical alert systems (FTC v. Instant Response Systems, LLC, FTC File No. 122 3041, Case No. 1:13-cv-00976).

The FTC’s complaint alleges that the New York-based company would place unsolicited telephone calls to elderly consumers advertising medical alert systems. The company would claim to be responding to a request for information from the consumers or their loved ones, although consumers often reported that they did not know how the company obtained their telephone numbers. The company’s representatives would ask health questions, and would explain that the service consisted of a pendant the consumers could push for emergency help.

The FTC alleges that on many occasions the company would send notices to the consumers demanding payment for the service, even if the consumers had not ordered it. The company would also send medical alert pendants to consumers who had not ordered them. Some of the company’s letters would threaten legal consequences if the consumers refused to pay for the service, including sending a copy of a fictitious police report and a threat to file it if a consumer did not pay for the service. If consumers called the company to dispute the charges, company representatives would allegedly verbally abuse them and threaten them, or refuse to speak to them altogether.

The FTC’s complaint charges Instant Response Systems, B.B. Mercantile, Ltd., Medical Alert Industrial, Medical Alert Services, and Instant Response Systems’ officer Jason Abraham, also known as Yaakov Abraham, with violations of the FTC Act; the Commission’s Telemarketing Sales Rule, including calling consumers on the Do Not Call Registry; and the Unordered Merchandise Statute. The complaint requests temporary, preliminary, and permanent injunctions, an order freezing assets, a financial accounting, and relief necessary to redress the injury to consumers.

Abraham was previously sued by the FTC in 2003 for selling international drivers’ licenses and false university diplomas.

News: ConsumerProtection FederalTradeCommissionNews