NASHVILLE, Tenn. (Legal Newsline) - Ten state attorneys general announced a settlement on Thursday with a Georgia marketer that allegedly misled consumers with fraudulent auto advertisements.
The Norcross-based Action Integrated Marketing and Jay D. Murphree, its CEO, allegedly lured customers through promises of special deals that weren't anything out of the ordinary.
The lawsuit alleged that the defendants used phrases like "Government Vehicle Disposal," and "The Repo Joe Sale," as ways to attract buyers to used car sales events, but the vehicles up for sale were actually from the normal inventory.
"Advertisements that indicate a product is available in limited supply for a short time may give consumers a false sense of urgency to buy something they have not thoroughly researched," Tennessee Attorney General Bob Cooper said.
"In Tennessee, our laws prohibit companies from misleading the public through such tactics."
The suit alleged that the ads also failed to disclose accurate prices, with advertised sale prices contingent on finance agreements.
"The defendants' advertisements clearly misrepresented the terms of their sales events to consumers," Illinois Attorney General Lisa Madigan said. "An automobile purchase is a major financial commitment and entering into this transaction, consumers deserve facts not fabrications."
Additionally, Action Integrated Marketing allegedly advertised credit terms for buyers but did not disclose that the availability of the credit terms was dependent on the creditworthiness of the purchaser, the down payment, the term of the contract and the rate of financing.
Under terms of the agreement, the company is required to halt all misleading ads and must disclose all prices and sale terms in all future advertisements. The company is also barred from selling auto advertising promotions that include credit terms that do not disclose term limits.
If the defendants are compliant, a civil penalty of $130,000 will be suspended.
The ads appeared in numerous states, with Georgia, Idaho, Kentucky, North Carolina, Ohio, Oregon, Pennsylvania and Washington also taking part in the settlement.