Arkansas Attorney General Leslie Rutledge’s office said the state has won a $194,500 default judgment against a company that failed to respond to a federal lawsuit alleging violations of consumer protection laws.
Rutledge sought a default judgment against Electronic Media Marketing Group of New Jersey in June, noting that the company had not responded to the legal action. Electronic Media Marketing is the operator of General Yellow Pages of New York. The lawsuit alleged that General Yellow Pages illegally coerced Arkansas businesses into paying for services they did not authorize. The lawsuit was filed in February 2014 in U.S. District Court in Little Rock, Ark.
Last week, U.S. District Judge Leon Holmes granted Rutledge’s motion and issued an order requiring the firm to stop collection attempts and telemarketing calls, pay $190,000 in civil penalties and another $4,500 in legal fees. Multiple complaints from Arkansas businesses led to the suit, said Rutledge.
Vlad Adolth, president of General Yellow Pages, said the firm was never served with the lawsuit and will appeal the judgment.
He said the company received questions from several state attorneys general after Arkansas began talking to the media about General Yellow Pages. In response, the company provided the state attorneys general with documents showing that its customers participated willingly in 30-day free trials, he added.
Rutledge said the company allegedly contacted businesses and claimed they had agreed to a free trial of advertising in an online directory and that, because they did not cancel services when the free trial ended, they owed hundreds of dollars for an additional year of services, according to the lawsuit.
The type of scam is known as the "director listing scam."
The company allegedly would send urgent invoices to the targeted businesses that sometimes included the "walking fingers" logo and the Yellow Pages name. In many cases, employees of those businesses would respond by writing checks without realizing that payment had not been authorized, Rutledge said.
If money was not sent, the company would make calls and send collection notices, applying late fees and other penalties, she said.