SEATTLE (Legal Newsline) - Washington Attorney General Rob McKenna announced on Tuesday that a judge has ruled that the owners of an e-commerce company that allegedly failed to deliver on its promises to help businesses must pay restitution.
In 2009, McKenna filed a lawsuit against Jeremy Avey, Alexander Martin, Brent Stanphill and the businesses they operated, alleging that the defendants misrepresented the help they could provide. Their businesses changed names frequently, allegedly in an effort to circumvent the law.
Named in the suit were Cybercom Technologies, which did business in Bothell, Wash., as Wizy-Wiz eCommerce; TNT Cart, which also operated under the name Strada Technologies in Kirkland, Wash. and Seattle; and White Crane Technologies, which operated in Redmond, Wash. The defendants' most recent business name was ABC eCommerce.
The defendants allegedly never delivered services as promised, provided poor customer service, made unauthorized charges to consumers' debit and credit cards, and did not honor money-back guarantees.
The defendants also allegedly failed to register as a commercial phone solicitor, which is illegal under state law.
"The defendants made their living by taking thousands of dollars from small businesses, promising services they couldn't deliver, then closing shop as soon as customer complaints rolled in," McKenna said.
"Thanks to the excellent work of Senior Counsel Paula Selis and our Consumer Protection High-Tech Unit, these operators must cease their deceptive practices and pay back everyone they cheated."
Requests by the state and court for information about their customers went ignored, so King County Superior Court Judge Julie Spector ruled that the defendants were prohibited from opposing the state's claims, McKenna says.
Oral arguments were held on Dec. 3, and the judge ruled that the defendants violated Washington's Consumer Protection Act and Commercial Telephone Solicitation Act.
Under terms of the judgment, the defendants are required to pay a $226,000 civil penalty and another $137,500 for costs associated with the litigation. They are also required to pay $108,000 in restitution to 35 customers who filed complaints with McKenna's office.
Additionally, the defendants are required to compose a list of other customers nationwide who have complained to them about the issues identified in the complaint and offer refunds to all. This must be done in the next two weeks.
The court order also includes a list of injunctive provisions that prevent the defendants from making misrepresentations in connection with any Internet business. If they fail to comply with any terms of this order, an additional civil penalty of up to $25,000 per violation will be incurred.