Attorney General Mark Barnett Announces Settlements in Two Consumer Cases
(Pierre) – Attorney General Mark Barnett announced today that his office has recently been involved in the settlement of two consumer related cases. The first case involves all 50 states and the District of Columbia in action taken against TAP Pharmaceutical Products Inc. Due to damages caused by TAP’s marketing practices for its drug Lupron, which is used to treat prostate cancer, South Dakota will receive $55,717 in restitution and penalties. To date 43 states and the District of Columbia have executed settlement agreements. The state settlement was reached in conjunction with a federal settlement.
TAP is now required to report accurate pricing information to state Medicaid programs as well as the commercial price reporting services that provide pricing information to the states. TAP will also cooperate with the states in the investigation of other health care providers who may have damaged the Medicaid programs by taking advantage of TAP’s marketing schemes.
The second case was generated by deceptive practices of a group of buying clubs. The buying clubs were a spin-off from consumers ordering items from telemarketers, or when they responded to a television ad, and made purchases over the phone. The buying clubs would take the order, then offer the consumer the chance to join the buying club and receive additional discounts. They were told they could receive a free 30-day membership in the club, but what they were not told is that after 30 days the consumer would be hit with a monthly fee that would automatically be charged to their credit card.
The state will receive $2,500 in restitution, and in addition 677 South Dakota citizens will receive restitution. The restitution comes from a Boca Raton based company called Triad Discount Buying Services Inc, related companies and their operator, Ira Smolev. This was a multi-state investigation and settlement. " I am disappointed at the number of crooks out there that are so willing to victimize others. My office can help by seeing that the deceptive business is stopped and restitution made to our citizens" Barnett said.
The Buying companies now face new prohibitions in their marketing practices to avoid future deception. The companies are also prohibited from signing up new members, renewing existing memberships, and from disseminating the consumer’s personal billing information without authorization from the consumer.