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FTC Action Terminates Nationwide Employment Scam

An operation that allegedly deceived consumers with bogus promises of nonexistent sales jobs will be banned from marketing any employment products or services under a settlement with the Federal Trade Commission.

The proposed settlement order against National Sales Group and other defendants resolves FTC charges filed as part of a crackdown on scammers who falsely promise employment opportunities to financially distressed consumers. According to the FTC’s complaint, the defendants advertised on CareerBuilder.com and other online job boards, and their telemarketers falsely told consumers they recruited for Fortune 1000 employers and had a unique ability to get them interviewed and hired.

The FTC complaint alleged that the defendants charged fees, purportedly for background checks and other services, and often overcharged, taking $97 from consumers who had agreed to pay $29 or $38. The defendants also allegedly charged some consumers recurring fees of $13.71 or more per month without their consent. At the FTC’s request, in February 2011, the court halted the allegedly illegal practices and froze the defendants’ assets pending litigation.

Under the proposed settlement order, Anthony J. Newton, National Sales Group, and I Life Marketing LLC, also doing business as Executive Sales Network and Certified Sales Jobs, are banned from selling employment products or services. They and co-defendant Jeremy S. Cooley are permanently prohibited from misrepresenting material facts about any product or service, and from violating the FTC’s Telemarketing Sales Rule, including misrepresenting the benefits of a good or service or misrepresenting that any person is affiliated with or endorsed by another person or government entity. The defendants also are barred from violating the Rule by billing consumers without their consent and failing, during calls, to clearly and promptly disclose the seller’s identity, the call’s purpose, and the nature of the goods or services.

The order also bars the defendants from selling or using customers’ personal information, failing to properly dispose of customer information, and attempting to collect payments from past customers. In addition, the order imposes a $13 million judgment that will be suspended once Newton has paid $279,000, terminated a lease on a 2009 Mercedes-Benz, and surrendered his interest in a residence in Huntington Beach, California. The full judgment will be imposed immediately if the defendants are found to have misrepresented their financial condition.

The Commission vote approving the proposed consent order was 4-0. It is subject to court approval. The FTC filed the proposed consent order in the U.S. District Court for the Northern District of Illinois, Eastern Division.

For more information, read Job Hunting-Job Scams.

NOTE: This consent order is for settlement purposes only and does not constitute an admission by the defendant that the law has been violated. Consent orders have the force of law when approved and signed by the District Court judge.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics. Like the FTC on Facebook and follow us on Twitter.

(National Sales Group)
(FTC File No. X110015)

Under FTC Settlement, Debt Buyer Agrees to Pay $2.5 Million for Alleged Consumer Deception

One of the nation’s largest consumer debt buyers has agreed to pay a $2.5 million civil penalty to settle Federal Trade Commission charges that it made a range of misrepresentations when trying to collect old debts. In addition, the company, Asset Acceptance, LLC, has agreed to tell consumers whose debt may be too old to be legally enforceable that it will not sue to collect on that debt.

The proposed settlement order resolving the agency’s charges also requires that when consumers dispute the accuracy of a debt, Asset Acceptance must investigate the dispute, ensuring that it has a reasonable basis for its claims the consumer owes the debt, before continuing its collection efforts. The proposed order also bars the company from placing debt on consumers’ credit reports without notifying them about the negative report. The U.S. Department of Justice filed the proposed settlement order this week at the FTC’s request.

“Most consumers do not know their legal rights with respect to collection of old debts past the statute of limitations,” said David Vladeck, Director of the FTC’s Bureau of Consumer Protection. “When a collector tells a consumer that she owes money and demands payment, it may create the misleading impression that the collector can sue the consumer in court to collect that debt. This FTC settlement signals that, even with old debt, the prohibitions against deceptive and unfair collection methods apply.”

The FTC’s action – alleging that Asset Acceptance violated the FTC Act, the Fair Debt Collection Practices Act, and the Fair Credit Reporting Act – is part of the FTC’s continuing efforts to protect consumers adversely affected by the struggling economy. The agency today also issued a new publication for consumers, “Time-Barred Debts: Understanding Your Rights When It Comes to Old Debts“.

Michigan-based Asset Acceptance buys unpaid debts from credit originators such as credit card companies, health clubs, and telecommunications and utilities providers, as well as other debt buyers, and attempts to collect them. Asset Acceptance has purchased tens of millions of consumer accounts for pennies on the dollar. It targets accounts that other collectors have pursued and are more than a year past due, and in some cases attempts to collect debt that is more than 10 years old. Some of this debt is too old to be legally enforceable – state statutes of limitations cut off the right to sue to collect the debt after some period of time has passed, depending on the state and the type of debt. And many consumers do not know that making a partial payment of a debt may reset the state law’s clock on the collector’s ability to take legal action.

The FTC’s nine-count complaint charged Asset Acceptance with:

misrepresenting that consumers owed a debt when it could not substantiate its representations;
failing to disclose that debts are too old to be legally enforceable or that a partial payment would extend the time a debt could be legally enforceable;
providing information to credit reporting agencies, while knowing or having reasonable cause to believe that the information was inaccurate;
failing to notify consumers in writing that it provided negative information to a credit reporting agency;
failing to conduct a reasonable investigation when it received a notice of dispute from a credit reporting agency;
repeatedly calling third parties who do not owe a debt;
informing third parties about a debt;
using illegal debt-collection practices, including misrepresenting the character, amount, or legal status of a debt; providing inaccurate information to credit reporting agencies; and making false representations to collect a debt; and
failing to provide verification of the debt and continuing to attempt to collect a debt when it is disputed by the consumer.

The proposed settlement requires that when Asset Acceptance knows or should know debt may not be legally enforceable under state law – often referred to as “time-barred” debt – it must disclose to the consumer that it will not sue on the debt and, if true, that it may report nonpayment to the credit reporting agencies. Once it has made that disclosure, it may not sue the consumer, even if the consumer makes a partial payment that otherwise would make the debt no longer time-barred.

The order also prohibits the company from:

Making any material misrepresentation to consumers and making any representation that a consumer owes a particular debt, or as to the amount of the debt, unless it has a reasonable basis for the representation. To ensure it has such a basis, the order requires Asset Acceptance to investigate consumer disputes before continuing collection efforts;
“Parking” – or placing – debt on a consumer’s credit report when it has failed to notify the consumer in writing about the negative report, and;
Violating the Fair Credit Reporting Act and the Fair Debt Collection Practices Act, in the ways alleged in the complaint.

The FTC has issued a new publication to help consumers understand how debt collectors attempt to collect old debts, along with their rights in these cases. “Time-Barred Debts: Understanding Your Rights When It Comes to Old Debts” provides information on when a debt is too old for a collector to sue, what consumers should do if a debt collector calls about a time-barred debt, and whether a consumer should pay a debt that’s considered time-barred. It also provides advice on what consumers should do if they are sued for a time-barred debt, including defending themselves in court and asserting their rights under the Fair Debt Collection Practices Act. Finally, it has links to other FTC publications and videos about dealing with debt.

The Commission vote authorizing the staff to refer the complaint to the Department of Justice was 4-1, and the vote to approve the proposed consent decree, was 3-1, with Commissioner J. Thomas Rosch voting no for both. The DOJ filed the complaint and proposed consent decree on behalf of the Commission in U.S. District Court for the Middle District of Florida today. The proposed consent decree is subject to court approval.

NOTE: The Commission authorizes the filing of a complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. The complaint is not a finding or ruling that the defendant has actually violated the law. This consent decree is for settlement purposes only and does not constitute an admission by the defendant of a law violation. Consent decrees have the force of law when signed by the District Court judge.

(FTC File No. 052-3133)
(8:12-cv-182-T-27EAJ. Judge Whittemore)
(Asset Acceptance.final)

FTC Sues to Block Omnicare’s Bid to Buy Rival Pharmacy Provider PharMerica

The Federal Trade Commission issued a complaint to block Omnicare, Inc.’s hostile acquisition of rival long-term care pharmacy provider PharMerica Corporation, alleging that the combination of the two largest U.S. long-term care pharmacies would harm competition and enable Omnicare to raise the price of drugs for Medicare Part D consumers and others.

In its complaint, the FTC charges that a deal combining Omnicare and PharMerica would significantly increase Omnicare’s already substantial bargaining leverage by dramatically increasing the number of skilled nursing facilities, known as SNFs, that receive long-term care pharmacy services from the company. Due to its substantial market share, the FTC alleges that the combined firm likely would be a “must have” for Medicare Part D prescription drug plans, which are responsible for providing subsidized prescription drug benefit coverage for most SNF residents and other Medicare beneficiaries.

According to the Centers for Medicare & Medicaid Services (CMS) of the Department of Health and Human Services, the proposed acquisition “appears likely to result in higher reimbursement rates . . . and thereby to increase the cost to CMS (and therefore the U.S. government and U.S. taxpayers) as well as any individuals who pay out-of-pocket costs in connection with such services.”

“If Omnicare is allowed to purchase its biggest and only national competitor, it will diminish competition and raise health care costs – leaving taxpayers and patients to foot the bill,” said Richard Feinstein, Director of the FTC’s Bureau of Competition. “The Bureau will continue to be vigilant in our efforts to prevent these sorts of anticompetitive deals.”

The FTC’s administrative complaint is part of the agency’s ongoing efforts to maintain competition in the U.S. health care sector, which benefits consumers by keeping prices low and quality and choice of products and services high. This year, more than 1.6 million Part D Medicare beneficiaries are expected to require long-term care while living in an SNF, and about 1.1 billion prescriptions per year are processed under Part D on behalf of approximately 29 million beneficiaries.

Long-term Care Pharmacies. Unlike traditional retail pharmacies, long-term care pharmacies do not provide medications directly to “walk-in” consumers from nearby homes. Instead, long-term pharmacies work with SNFs and other institutional providers to arrange for the delivery and administration of prescription medications to the SNF’s residents. Most SNF residents need help with the ordering, delivery, and administration of their drugs, and a majority of them get prescription drug coverage from a Part D prescription drug plan.

To protect this fragile population and ensure they receive the Part D benefits they are entitled to, CMS requires Part D plans to provide SNF residents with “convenient access” to a network of long-term care pharmacies, such as Omnicare and PharMerica. This ensures that SNF residents can get their prescription drugs from a long-term care pharmacy that contracts with the residents’ chosen Part D health plan. Health plans that cannot provide their beneficiaries with “convenient access” to long-term care pharmacies risk being barred from offering Medicare Part D health plans.

Omnicare, headquartered in Covington, Kentucky, owns and operates approximately 204 long-term care pharmacies in 44 states. In 2010, Omnicare had revenues totaling about $6.1 billion. PharMerica, headquartered in Louisville, Kentucky, owns and operates approximately 97 long-term pharmacies in 43 states. In 2010, PharMerica had revenues of approximately $1.8 billion.

The FTC’s Complaint. According to the FTC’s complaint, Omnicare’s proposed acquisition of PharMerica, the second-largest long-term care pharmacy in the United States, would be illegal and in violation of Section 5 of the FTC Act and Section 7 of the Clayton Act. The acquisition would combine the largest and only two national long-term care pharmacies in the country. The FTC alleges that the combined firm would serve approximately 57 percent of all licensed SNF beds in the United States. Under the Merger Guidelines used by the FTC and Department of Justice, a transaction that leads to that much market concentration would be presumed illegal. After the acquisition, the merged firm’s only competition for inclusion in Part D plans’ long-term care pharmacy networks would come from small, regional and local long-term care pharmacies, none of which currently operates in more than a few states.

The FTC charges that, even before the transaction, Omnicare has been able to use its size to exert bargaining leverage over Part D health plans, by threatening to terminate contracts if its terms are not met. A firm that combines the largest and second-largest long-term care pharmacies in the country would have the unique ability to exert even greater bargaining power to raise the price of drugs to Part D health plans.

Due to its substantial market share, the combined firm likely would be a “must have” for Part D health plans, the FTC contends. Losing contracts with a combined Omnicare/PharMerica would put the Part D health plans at serious risk of failing to meet CMS’s “convenient access” standard. This increased risk would provide the combined firm with an anticompetitive advantage in negotiating prices it charges Part D health plans for long-term care pharmacy services.

The Commission vote to issue the administrative complaint against Omnicare was 3-1, with Commissioner J. Thomas Rosch voting no. The case will be heard before an administrative law judge at the FTC in June 2012.

NOTE: The Commission issues an administrative complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. The complaint is not a finding or ruling that the respondent has actually violated the law. The issuance of the administrative complaint marks the beginning of a proceeding in which the allegations will be tried in a formal hearing before an administrative law judge.

The FTC’s Bureau of Competition works with the Bureau of Economics to investigate alleged anticompetitive business practices and, when appropriate, recommends that the Commission take law enforcement action. To inform the Bureau about particular business practices, call 202-326-3300, send an e-mail to [email protected], or write to the Office of Policy and Coordination, Bureau of Competition, Federal Trade Commission, 601 New Jersey Ave., Room 7117, Washington, DC 20580. To learn more about the Bureau of Competition, read Competition Counts. Like the FTC on Facebook and follow us on Twitter.

(FTC File No. 111-0239)
(Omnicare.final)

FTC and DOJ To Host Phone Availability on Major Debt Collection Industry Enforcement Action

As part of its continuing effort to protect consumers from financial fraud and keep them informed, the Federal Trade Commission will be joined by the U.S. Department of Justice to discuss a major enforcement action involving the debt collection industry. The Director of the FTC’s Bureau of Consumer Protection and the Assistant Attorney General for DOJ’s Civil Division will co-host a call-in media availability on Monday, January 30, 2012, at 11 am E.T. to explain the significance of this case against a national debt-collection operation, as well as the impact the agencies’ action will have on consumers.

WHAT:	Media Call-in on FTC/DOJ Debt Collection Enforcement Action
WHO:	David Vladeck, Director, FTC Bureau of Consumer Protection Tony West, Assistant Attorney General, DOJ Civil Division
WHEN:	Monday, January 30, 2012, 11 am E.T. (Phone lines open at 10:45 am)
PRESS CONTACT:	Office of Public Affairs 202-326-2180
CALL-IN INFORMATION:	1-800-230-1093 Confirmation number: 235345 Host: Bruce Jennings Call-in Lines are for Media Only

(Debt Advisory.final)

FTC to Host Workshop on Mobile Payments and Their Impact on Consumers

The Federal Trade Commission will host a workshop on April 26, 2012, to examine the use of mobile payments in the marketplace and how this emerging technology impacts consumers. This event will bring together consumer advocates, industry representatives, government regulators, technologists, and academics to examine a wide range of issues, including the technology and business models used in mobile payments, the consumer protection issues raised, and the experiences of other nations where mobile payments are more common. The workshop will be free and open to the public.

Topics may include:

What different technologies are used to make mobile payments and how are the technologies funded (e.g., credit card, debit card, phone bill, prepaid card, gift card, etc.)?
Which technologies are being used currently in the United States, and which are likely to be used in the future?
What are the risks of financial losses related to mobile payments as compared to other forms of payment? What recourse do consumers have if they receive fraudulent, unauthorized, and inaccurate charges? Do consumers understand these risks? Do consumers receive disclosures about these risks and any legal protections they might have?
When a consumer uses a mobile payment service, what information is collected, by whom, and for what purpose? Are these data collection practices disclosed to consumers? Is the data protected?
How have mobile payment technologies been implemented in other countries, and with what success? What, if any, consumer protection issues have they faced, and how have they dealt with them?
What steps should government and industry members take to protect consumers who use mobile payment services?

To aid in preparation for the workshop, FTC staff welcomes comments from the public, including original research, surveys and academic papers. Electronic comments can be made at https://ftcpublic.commentworks.com/ftc/mobilepayments. Paper comments should be mailed or delivered to: 600 Pennsylvania Avenue N.W., Room H-113 (Annex B), Washington, DC 20580.

The workshop is free and open to the public; it will be held at the FTC’s Satellite Building Conference Center, 601 New Jersey Avenue, N.W., Washington, D.C.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s Web site provides free information on a variety of consumer topics.

FTC Permanently Stops Six Operators from Using Fake News Sites that Allegedly Deceived Consumers about Acai Berry Weight-Loss Products

Six online marketers agreed to settlements with the Federal Trade Commission that will permanently halt their allegedly deceptive practice of using fake news websites to market acai berry supplements and other weight-loss products.

As part of its ongoing crackdown on bogus health claims, the proposed settlements will require that the six operations make clear when their commercial messages are advertisements rather than objective journalism, and will bar the defendants from further deceptive claims about health-related products such as the acai berry weight-loss supplements and colon cleansers that they marketed.

The defendants also are required to disclose any material connections they have with merchants, and will be barred from making deceptive claims about other products, such as the work-at-home schemes or penny auctions that most of them promoted. The settlements also require that these defendants collectively pay roughly $500,000 to the Commission because their advertisements violated federal law. This money amounts to most of their assets.

At the request of the FTC, federal courts temporarily halted these operations and four others. In its sweep last year against marketers who allegedly used fake news sites to promote weight-loss products, the FTC alleged that their websites were designed to falsely appear as if they were part of legitimate news organizations, but were actually nothing more than advertisements deceptively enticing consumers to buy the featured acai berry weight-loss products from online merchants. With titles such as “News 6 News Alerts,” “Health News Health Alerts,” or “Health 5 Beat Health News,” the sites often falsely represented that the reports they carried had been seen on major media outlets such as ABC, Fox News, CBS, CNN, USA Today, and Consumer Reports. Investigative-sounding headlines presented stories that purported to document a reporter’s first-hand experience with acai berry supplements – typically claiming to have lost 25 pounds in four weeks, according to the FTC complaints.

The proposed settlements impose monetary judgments in the full amount of the commissions the defendants received for deceptive marketing through their fake news sites. Due to the defendants’ financial condition, the judgments will be suspended when the FTC receives the following assets from them. In all cases, if it is later determined that the financial information the defendants provided the FTC was false, the full amount of their judgments would become due:

Ricardo Jose Labra Labra’s $2.5 million judgment will be suspended when he pays $280,000 and records a $39,500 lien on his home.

Zachary S. Graham, Ambervine Marketing, LLC and Encastle, Inc. Graham’s $953,000 judgment will be suspended when he pays $110,000 plus most of the proceeds from the sale of a truck.

Tanner Garrett Vaughn Vaughn’s $203,000 judgment will be suspended when he pays close to $80,000 over a three-year period.

Thou Lee Lee’s $204,000 judgment will be suspended when he pays $13,000 plus the proceeds from the sale of a BMW.

Charles Dunlevy Dunlevy’s $143,000 judgment will be suspended when he pays an estimated $2,000 from frozen assets and the sale of a boat.

DLXM, LLC and Michael Volozin The $594,000 judgment will be suspended because of the defendants’ inability to pay.

According to the FTC complaints, in pitching the acai weight-loss products, the defendants posted attention-grabbing ads on search engines and high volume websites, such as “Acai Berry EXPOSED – Health Reporter Discovers the Shocking Truth,” driving traffic to the fake news sites and ultimately to the sites where merchants sell the products. The FTC received numerous complaints from consumers who paid between $70 and $100 for weight-loss products after having been deceived by fake news sites.

Derived from acai palm trees that are native to Central and South America, acai berry supplements often are marketed to consumers who hope to lose weight. In another recent settlement with online acai berry marketers, defendants in the Central Coast Nutraceuticals case were required to pay $1.5 million. In 2011, the Commission brought suit against two other online acai berry marketers: LeanSpa, LLC, which the Commission sued in conjunction with the State of Connecticut, and Jesse Willms. In both cases, the FTC obtained preliminary injunctions barring the defendants from engaging in the charged deceptive practices.

The FTC helps consumers recognize and avoid deceptive claims made by fake news sites that market acai berries for weight loss. To learn more, see the consumer alert THIS JUST IN: Fake News Sites Promote Bogus Weight Loss Benefits of Acai Berry Supplements, and the video Free Trial Offers, which explains how free trials are often used to market acai berry supplements and other products.

The Commission votes authorizing the staff to file the proposed settlement orders against Ricardo Labra and Tanner Vaughn were 4-0. The votes authorizing the staff to file the proposed settlement orders against Zachary Graham, Ambervine Marketing, LLC and Encastle, Inc.; Thou Lee, DLXM, LLC and Michael Volozin; and Charles Dunlevy were 3-1, with Commissioner J. Thomas Rosch voting no. The following courts have approved the settlement orders:

the U.S. District Court for the Northern District of Illinois, Eastern Division, on January 11 and 12, 2012. (Zachary S. Graham, Ambervine Marketing LLC, and Encastle, Inc.; Ricardo Jose Labra; and Thou Lee, also doing business as TL Advertising.)
the U.S. District Court for the Northern District of Georgia on January 12, 2012. (Charles Dunlevy.)
the U.S. District Court for the Western District of Washington on January 12, 2012. (Tanner Garrett Vaughn, also doing business as Lead Expose, Inc., and Uptown Media, Inc.) And,
the U.S. District Court for the Eastern District of New York on January 19, 2012. (DLXM, LLC, also doing business as DLX Marketing, and Michael Volozin, also known as Mikhail Volozin.)

NOTE: A settlement order is for settlement purposes only and does not constitute an admission by the defendant that the law has been violated. Settlement orders have the force of law when approved and signed by the District Court judge.

(FTC File Nos. Zachary S. Graham, X110026; Ricardo Jose Labra, X110022; Thou Lee, X110025; Charles Dunlevy, X110030; Tanner Garrett Vaughn, X110027; DLXM, LLC, X110039)(Six Fake News Sites NR)

FTC Seeks Public Input in Review of Wool Products Labeling Rules

As part of the Federal Trade Commission’s systematic review of all current FTC rules and guides, the FTC is seeking public comment on the continuing need for, as well as the benefits, costs, and impact of, the Wool Products Labeling Rules.

The Wool Products Labeling Rules require labels on wool products disclosing the manufacturer’s or marketer’s name, the country where the product was processed or manufactured, and information about the fiber content. The FTC first issued the Rules under the Wool Products Labeling Act of 1939, known as the Wool Act. The agency completed its last review of the Rules in 1998 and modified the Rules in 1998 and 2000. In 2006, the Wool Act was amended by the Wool Suit Fabric Labeling Fairness and International Standards Conforming Act, which sets the maximum average fiber diameter for certain wool products.

FTC is also seeking comment on how it should modify the Wool Rules to implement the Conforming Act. In addition, the FTC seeks comment on the costs and benefits of the Rules, and on whether it should clarify or modify certain Rule provisions and/or its business and consumer education materials.

The Commission vote approving the Advance Notice of Proposed Rulemaking was 4-0. It is available on the FTC’s website and as a link to this press release and will be published in the Federal Register soon. Instructions for filing comments appear in the Federal Register Notice. Comments must be received by March 26, 2012. All comments received will be posted at www.ftc.gov/os/publiccomments.shtm. (FTC File No. P124201; the staff contact is Robert M. Frisby, Bureau of Consumer Protection, 202-326-2098)

For more information, read Threading Your Way Through the Labeling Requirements Under the Textile and Wool Acts and Cachet of Cashmere: Complying with the Wool Products Labeling Act.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call
1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s website provides free information on a variety of consumer topics. Like the FTC on Facebook and follow us on Twitter.

(Wool Products Labeling Rules)

FTC Seeks Public Comment on Healthcare Technology’s Application to Sell SDI Health’s Audit Businesses

The Federal Trade Commission seeks public comment on an application by Healthcare Technology Holdings, Inc., which is requesting approval to sell two audit businesses of SDI Health LLC to inVentiv Health, Inc. A divestiture is required by the final FTC settlement order allowing Healthcare Technology’s subsidiary IMS Health Inc. to acquire SDI Health.

According to the application, the sale of SDI Health’s audit businesses would satisfy the terms of the FTC’s final order, which settled FTC charges that the deal would have been anticompetitive and in violation of the FTC and Clayton Acts. The audit businesses include SDI’s promotional audit business and medical audit business.

The Commission will decide whether to approve the sale after the expiration of the public comment period. Public comments on the application may be submitted until February 27, 2012. Written comments should be sent to: FTC Office of the Secretary, 600 Pennsylvania Ave., N.W., Washington, DC 20580. Comments also can be filed electronically. Copies of the application also can be found on the FTC’s website and as a link to this press release. (FTC File No. 111-0097, Docket No. C-4340; the staff contact is Roberta S. Baruch, Bureau of Competition, 202-326-2861; see press release dated October 28, 2011.)

(FYI 5.2012.wpd)

FTC Announces Revised Thresholds for Clayton Act Antitrust Reviews

The Federal Trade Commission announced it has revised the thresholds that determine whether companies are required to notify federal antitrust authorities about a transaction under the Hart-Scott-Rodino Antitrust Improvements Act. These filing thresholds are required to be adjusted annually to keep pace with inflation, unlike the pre-merger filing fees, which have not changed in more than a decade.

The HSR Act requires companies to notify authorities if – among other things – the value of a transaction exceeds the filing thresholds. The FTC is required to revise those thresholds annually, based on the change in gross national product. For 2012, the threshold for reporting proposed mergers and acquisitions subject to enforcement under Section 7 of the Clayton Act increased from $66.0 million to $68.2 million.

The FTC also announced revisions to the thresholds that trigger a prohibition preventing companies from having interlocking memberships on their corporate boards of directors under Section 8 of the Clayton Act. The Act requires that the Commission revise those thresholds annually, based on the change in the level of gross national product. The new thresholds for the Act’s prohibition on interlocking directorates are $27,784,000 for Section 8(a)(1) and $2,778,400 for Section 8(a)(2)(A).

In the case of each type of threshold, the vote to approve Federal Register notices announcing the revisions was 4-0. The revised thresholds under Section 7A will apply to all transactions that close on or after the effective date of the notice, which is 30 days after its publication in the Federal Register. The thresholds for Section 8 will become effective upon publication in the Federal Register. (FTC File No. P859910; the staff contact for Section 7 is Michael Verne, Bureau of Competition, 202-326-3100; the staff contact for Section 8 is James F. Mongoven, Bureau of Competition, 202-326-2879.)

(FYI 4.5 2012.wpd)

FTC Action Bans Defendants from Providing Immigration Services

The immigration services business will be permanently off limits to an operation that allegedly posed as the federal government and tricked people into paying up to $2,500 for immigration forms, under settlements with the Federal Trade Commission.

The two settlements resolve charges the FTC filed in January 2011 against Immigration Center and its principals alleging that they claimed they were authorized to provide immigration and naturalization services, that they were affiliated with the U.S. government, and that fees paid by consumers would cover all the costs associated with submitting immigration documents to the United States Citizenship and Immigration Services. The court subsequently shut down the operation, froze the defendants’ assets, and appointed a receiver to control the business until the case was resolved.

In addition to banning Immigration Center, Charles Doucette, Deborah Stilson, and Alfred Boyce from providing immigration services, the settlement orders prohibit them from making misrepresentations about any goods or services, including federal government affiliation, the terms of any refund or cancellation policy, and their qualification to provide legal advice or services. They also are prohibited from selling or otherwise benefitting from customers’ personal information, and from failing to properly dispose of customers’ personal information within 30 days. The order against Immigration Center, Doucette, and Stilson also imposes a judgment of more than $3.1 million against Immigration Center, and a judgment exceeding $3.7 million against Doucette and Stilson. The judgments will be suspended upon the surrender of certain assets, including a car and a mobile home. The order against Boyce also imposes a judgment of more than $2.7 million, which will be suspended if the terms of the settlement order are met. The full judgments will become due immediately if the defendants are found to have misrepresented their financial condition.

Immigration Center, Charles Doucette, Deborah Stilson, and Alfred Boyce participated in the settlement announced today. The remaining defendants are in default.

The Commission vote approving the proposed consent order was 4-0. The consent order was entered by the U.S. District Court for the District of Nevada on December 27, 2011.

NOTE: The consent orders are for settlement purposes only and do not constitute an admission by the defendants that the law has been violated. Consent orders have the force of law when approved and signed by the District Court judge.

The Federal Trade Commission works for consumers to prevent fraudulent, deceptive, and unfair business practices and to provide information to help spot, stop, and avoid them. To file a complaint in English or Spanish, visit the FTC’s online Complaint Assistant or call 1-877-FTC-HELP (1-877-382-4357). The FTC enters complaints into Consumer Sentinel, a secure, online database available to more than 2,000 civil and criminal law enforcement agencies in the U.S. and abroad. The FTC’s Web site provides free information on a variety of consumer topics. Like the FTC on Facebook and follow us on Twitter.

(Immigration Center)
(FTC File No. X110013)

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