Ohio AG files suit against computer sales company

Nick Rees Nov. 17, 2009, 3:43pm

COLUMBUS, Ohio (Legal Newsline) - Ohio Attorney General Richard Cordray has filed a lawsuit alleging two companies targeted Ohioans with poor credit to sell them computers through layaway and credit sales agreements.

Joint companies BlueHippo Funding, LLC, and BlueHippo Capital, LLC, are charged with violating the consumer rights of Ohioans with their sales scheme.

"BlueHippo targets and takes advantage of consumers who believe their credit isn't good enough to obtain a computer in any other way," Cordray said.

"BlueHippo lures consumers into contracts that are unfairly one-sided in BlueHippo's favor, while failing to disclose important terms and conditions."

BlueHippo, which advertises its computers through print, radio and television ads, offers consumers guaranteed approval for financing without obtaining a credit check. The companies' advertisements promise that additional free electronic products, including printers and televisions, will also be sent.

Most of BlueHippo's sales are made over the telephone. The companies obtain consumers' checking account information at this time to process payments before consumers receive anything in writing.

More than 80 complaints have been filed against BlueHippo in 2009, a sharp increase since 2008, Cordray said. The complaints range from consumers who never received their ordered computer through the layaway program to consumers who did not receive the promised free products or refunds that were due.

Cordray's lawsuit charges the companies with numerous violations of Ohio's Consumer Sales Practices Act and asks the court to prohibit the companies from engaging in acts and practices that violate Ohio law. The lawsuit also seeks to award consumer restitution and to impose a civil penalty of $25,000 per violation.

A motion for a temporary restraining order has also been filed in conjunction with the lawsuit. The order seeks to force the companies to immediately stop their unfair and deceptive practices. Cordray, in filing for the temporary restraining order, asked the court to restrain the companies from the sale of computers and other electronic products, from engaging in debt collection activity and from engaging in acts or practices that violate the Ohio Consumer Sales Practices Act.

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