Court Halts Bogus Free Software CD Marketer: FTC

A U.S. magistrate judge has temporarily halted a company that the Federal Trade Commission alleges deceptively advertised free software CDs and billed consumers’ credit cards without their permission, the FTC announced yesterday.

According to the FTC, Texas-based Think All Publishing on an unspecified Web site offered consumers a free software CD if they would agree to pay a shipping and handling fee of $1.99 to $2.99. Consumers who signed up for the deal would be offered three more software CDs for no additional shipping or handling fees, the FTC alleges.

As part of the transaction, consumers would provide their names, addresses and credit card numbers, and check a box agreeing to terms of use, the FTC said.

Many consumers checked the box without reading the entire form, the FTC said. And in the seventh paragraph of the 14-paragraph document, it said that consumers must send back two of the four CDs within 10 days or they would be charged $39 or $49.

The document also said that consumers who didn’t send two of the four CDs back would automatically be enrolled in a continuity program, according to the FTC.

Typically, consumers wouldn’t learn that the CDs weren’t really free and that they were in a continuity program until the discovered the charges on their credit cards, the FTC alleges.

Moreover, consumers who called Think All for a refund were often denied and told that they should have read the terms of use more carefully.

The FTC charged Think All and its principal, Yuri Mintskovsky, with unfair and deceptive practices and violating the Unordered Merchandise Statute, which prohibits billing recipients for merchandise they didn’t order.

Prior to August 2005, Think All was known as Manay Software, LLC, according to the FTC.

The magistrate judge’s recommendation for a preliminary injunction against Mintskovsky and to freeze his assets is pending before a district court judge, according to the FTC.