Authorities in five states filed a lawsuit Tuesday against a magazine and newspaper subscription service they accuse of charging highly inflated prices for publications they weren’t authorized to sell.
The nationwide scam targeted mostly elderly readers, allegedly charging them as much as double the actual price for new subscriptions and renewal offers to publications such as The Wall Street Journal, the New York Times, Old Cars Weekly and Turkey & Turkey Hunting, the attorneys general of New York, Oregon, Minnesota, Missouri and Texas charged in simultaneous lawsuits.
The suits claim that the operators of Oregon-based Orbital Publishing Group Inc. and eight other interrelated third-party subscription companies mailed out millions of solicitations to consumers without publishers’ permission. The notices date back to 2010.
For example, the suits said some readers of the Journal received renewal offers from the Associated Publishers Network for $599.95 a year when the actual retail cost is $413. The companies would fulfill the subscriptions through the publications’ websites and pocket the difference, according to the suits.
In Colorado, renewals renewal notices at $489.95, about 71 percent more than a new seven-day print subscription.
The lawsuits requested judges in each state order the companies to cease soliciting subscriptions, turn over the names of everyone they took money from and make full monetary restitution to those who were duped.
In all, 44 publications filed complaints in the five states saying their readers were targeted. The alleged scam was eventually detected after the publications, Better Business Bureaus and consumer protection agencies began receiving a large number of complaints.
The Denver Post is not included in the lawsuits filed Tuesday. Senior vice president of circulation Bill Reynolds said the newspaper is working with the Colorado Attorney General’s office, “but we don’t know if it will result in a lawsuit like it did in these other states.”
Late last year, the Times, the Journal and its sister publication Barron’s, ran full-page advertisements warning readers to beware of fake renewal notices. The Denver Post warned subscribers in e-mails, and
in print and online ads.
Reynolds estimated that fewer than 40 Post subscribers responded to the face solicitations. “Hopefully, we communicated well to our readers and we kept that number to the minimum,” he said.
The Denver Post is refunding subscribers the amount of money forwarded to the the newspaper by the bogus circulation company.
The Wall Street Journal has given out $2.6 million in free subscriptions to roughly 7,000 readers who were taken in, and has spent an additional $900,000 in legal fees, the filings said. American Business Journals, which owns the Denver Business Journal, estimated that its readers lost around $120,000 as a result of the alleged scam.
