January 11, 2008
Kansas City, Mo. — A Utah company that offered “free trials” of a weight loss pill to consumers but buried a clause in its fine print about $99.95 in hidden charges is being taken to task by Attorney General Jay Nixon. Nixon filed a lawsuit Thursday (Jan. 10) against Steel Bridge Medical LLC of Salt Lake City, alleging the company misrepresented to consumers that the “free trial” of Lipoplex would only cost $6.95 in shipping and handling and failing to adequately notify that signing up for the offer meant automatically signing up for nearly $100 in additional charges.
Nixon says that from at least Dec. 2006 through July 2007, Steel Bridge Medical advertised the “free trials” of Lipoplex, an herbal dietary supplement that the company claims will induce weight loss, on the Internet at www.lipoplex.com and www.mylipoplex.com. The sites’ order pages referred to a “Free Trial Offer” for an order of the pills, with a line reading “Your credit card will be billed $6.95” for shipping and handling. If they chose to do so, consumers could visit the defendant’s “Terms and Conditions” by clicking on a hyperlink.
Nixon says that the only mentions of further charges were buried within Steel Bridge Medical’s three page “Terms and Conditions” and in fine print on the bottom of the company’s two Web sites. A well-hidden clause in the lengthy “Terms and Conditions” also constitutes the only consumer warning of the company’s unequivocal no returns policy. Consumers who placed “Free Trial” orders were automatically billed for a subsequent shipment of a three-month supply of Lipoplex if they did not cancel their enrollment within 14 days, a cost of $99.95 charged to their credit or debit accounts without permission. Steel Bridge Medical would then refuse to accept returns of the extra supply of Lipoplex or issue refunds to consumers.
“Unsuspecting consumers may have hoped to lose a few pounds by trying out this product on what they thought was a free trial offer, but the only thing that got lighter was their wallets,” Nixon said. “It’s outrageous that the company prominently markets a risk-free trial offer, but fails to warn and ultimately misleads consumers as to the true terms and conditions of the deal.”
At least nineteen Missouri consumers placed orders for the Lipoplex “Free Trial” through the defendant’s Web sites or by calling.
Nixon’s lawsuit is requesting that the court issue an injunction to stop the company from continuing to violate Missouri’s consumer protection laws. The lawsuit is also asking the court to order the defendant to make changes to the company’s Web site that accurately and prominently reflect the terms and conditions of the offer, including language warning consumers that they will automatically be shipped a nonreturnable 90-day supply of Lipoplex and be billed $99.95 if they fail to cancel their order within 14 days. Nixon is also requesting that the court order the defendant to pay restitution and appropriate penalties.