Restitution checks issued in $40M buying club settlements

By Emily Moore | Sep 22, 2014

DES MOINES, Iowa (Legal Newsline) - Iowa Attorney General Tom Miller’s Consumer Protection Division is issuing restitution checks to Iowans from a $40 million settlement from three separate buying club cases.

A settlement administrator began sending checks last week to approximately 400,000 consumers affected by the case against Vertrue Inc. and Affinion Group Inc., both of Connecticut, and Stonebridge Benefit Services Inc. of Texas.

Consumers were notified of the partial refunds of their buying club membership fees in early July. The refunds range from $6 to $40, although some may be higher. The refund process will take up to two months.

According to Miller, all three companies violated Iowa Consumer Fraud Laws because of monthly membership fees that members were unaware of.

Miller was successful in a lawsuit against Vertrue Inc. and the State collected $32.6 million of a $40 million judgment. Vertrue Inc. later filed bankruptcy.

“In the Vertrue case, the District Court and the Iowa Supreme Court both ruled that the company essentially based its business model on tricking Iowans into paying fees for memberships that most didn’t know they had, they didn’t use and didn’t want,” Miller said. “Now it’s time for Iowans to receive the restitution that they’re rightly entitled to.”

Settlements were reached with Affinion and Stonebridge. Both companies denied wrongdoing but agreed to pay the refunds.

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