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Business litigation leads to substantial infomercial judgment

Federal authorities are claiming a substantial victory against several companies. The judgment handed down in the federal business litigation case, which was heard outside the state of Georgia, awarded the Federal Trade Commission $478 million against several companies that sold consumers get-rich-quick services. Authorities claimed in their suit that the companies used deception to sell their services.

The suit alleged that the companies sold consumers a system through TV infomercials for under $40 and then also offered consulting services that could cost as much as $14,995. Authorities also asserted that the company charged consumers a monthly fee without notifying them. This fee was alleged to be continuously charged unless consumers told them to cancel it, an act that authorities argued was deceptive.

The FTC notes the $478 million judgment received is the largest the agency has ever been awarded in litigation. Officials plan on using the monies obtained from the judgment to pay back nearly a million victims who suffered losses. The judgment also forbids some of the companies from ever entering into the infomercial and telemarketing industries ever again.

Charting a course through the many business laws of Georgia can be a difficult task. So can drafting enforceable contracts. In order to avoid costly business litigation, business owners may benefit from investigating what they can and cannot do when it comes to generating profits. This may set the stage for hardworking individuals to chart a course that allows them to develop a successful business while staying clear of the many issues that can arise if a business falls out of line with acceptable business practices set forth in state and federal law.

Source: The Telegraph, "WASHINGTON: FTC wins $478M judgment vs infomercial marketers," The Associated Press, Aug. 23, 2012

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