More than two years after consumers across the country first started filing suit against Philips Respironics (Philips) over certain recalled sleep apnea devices, the company announced that it has reached an agreement to pay $479 million to compensate consumers. Philips voluntarily recalled several different models of continuous positive airway pressure (CPAP) and bilateral positive airway pressure (BiPAP) machines and ventilators back in June 2021. In the months that followed, Philips was inundated with lawsuits by consumers, which alleged that Philips knew about the serious risk of injury posed by its recalled devices long before any public announcement. Hundreds of consumer-facing lawsuits were ultimately consolidated in the U.S. District Court for the Western District of Pennsylvania in In re: Philips Recalled CPAP, Bi-Level PAP, and Mechanical Ventilator Products Liability Litigation.Continue Reading Recall Litigation Report: Philips Reaches Settlement in CPAP/BiPAP MDL
Subscription services for everything from food delivery to beauty products to exercise gear have grown exponentially in the past five years. Such services require consumers to enroll in a program to purchase goods on a consistent basis. They typically automatically renew, often on a monthly basis, and require customers wishing to cancel to take affirmative steps to avoid being charged. Marketers know that consumers often fail to take steps to cancel timely, which only benefits the marketers’ bottom lines.
With the explosion of subscription business models, consumer complaints have skyrocketed as well, with consumers complaining that the terms of the negative option offer – an offer that interprets a consumer’s failure to take an affirmative action as an agreement to be charged – were not clearly explained. For example, consumers have complained that were not told they would be charged each month, were not adequately reminded of how to “skip” being charged each month, that prepaid credits expire without notice, and that it can be difficult to cancel. Thus, subscription businesses have faced increasing regulatory scrutiny and all advertisers that offer products or services that automatically renew should pay close attention.
AdoreMe, a subscription lingerie service launched as a rival to Victoria’s Secret, recently agreed to pay $1.38 million to settle the Federal Trade Commission’s charges that the company did not clearly communicate to consumers the terms of its “VIP Membership” program which automatically billed consumers if they failed to “skip” a month within a 5-day window, falsely claimed that store credits could be used “any time,” and made it difficult for subscribers to cancel their memberships in violation of Section 5(a) of the FTC Act as well as the Restore Online Shoppers’ Confidence Act.
The Consumer Product Safety Commission continues on its path of settling higher civil penalties, announcing on May 27, 2015, that Office Depot agreed to a $3.4 million penalty for failing to report alleged defects in two office desk chair models. The products were sold exclusively at Office Depot’s retail and online stores and were …
As previously reported, Simon Property Group, Inc. recently acquired Prime Outlets Acquisition Company, LLC. This gained the attention of the FTC, which determined that the merger would result in reduction or elimination of competition among outlet centers in southwest Ohio; Chicago, and Orlando. Now, as part of a settlement with the FTC, Simon will divest some of its property and modify certain tenant leases.
Continue Reading Simon Reaches Agreement with FTC over Prime Outlets Acquisition; Comments Due December 10