I.C. Marketing Settles

Circulation Management, August 1, 2004

Byline: RAY SCHULTZ

Subscription agent I.C. Marketing Inc. has settled a 2 1/2-year-old lawsuit with Oregon Attorney General Hardy Myers over its purported marketing practices. But it was unclear at deadline whether the deal will help publishers trying to stop I.C. from marketing their subs.

Although it did not admit any law violations, the Nevada-based firm agreed to pay $71,950 to the state's Consumer Protection and Education Fund, and to create a mechanism for quickly resolving consumer complaints.

In addition, the consent judgment prohibits I.C. from selling subscriptions to magazines without authorization from a publisher, an agent or a clearinghouse, and from offering subs to defunct publications. And it must place the following statement on the front of its mailing pieces: "INDEPENDENT AGENT NOT A BILL, KEEP THIS PORTION FOR RECEIPT OF OFFER."

Finally, I.C. will drop a defamation suit filed in 2001 against several members of the AG's staff based on statements they made in press releases.

Both sides claimed victory in the case, Circulation Management learned.

"They realized they were wrong," said Alan Herson, attorney for I.C., of the AG's office. "They were trying to put us out of business. They didn't put us out of business." Herson, who said that he won a summary judgment for a related firm in the same case last year, added that the agreement will result in greater choice for consumers.

But Myers said in a statement that the judgment will "help ensure that consumers will receive clear and conspicuous information so they can make informed choices when purchasing or renewing a subscription." He added that the company will "only solicit orders for publications it has authority to provide from a clearinghouse or publisher."

Asked about the modest financial settlement, Myers' spokesperson, Kevin Neely, stated that "the dollars are less important than the agreement compelling the company to adhere to state law."

The two-way legal battle began in 2001 when the AG began probing consumer gripes against the firm. Myers' office had received hundreds of complaints, but some were facilitated by publishers in disputes with the I.C., according to Neely.