United States Purchasing Exchange Reaches Global Settlement On Sweepstakes Issues

United States Purchasing Exchange Statement

Apr 05, 2000, 01:00 ET from United States Purchasing Exchange

    NORTHRIDGE, Calif., April 5 /PRNewswire/ -- The following was issued by
 United States purchasing exchange:
     During the past couple of years the sweepstakes industry has experienced
 problems that have been generally related to inappropriate purchasing by some
 customers.  During this time our company sent many educational letters
 directly to customers as well as including consumer sweepstakes information
 and special letters in our mailings emphasizing that no purchase is necessary
 and that customers should buy only what they can use.  Last summer, USPE
 supported S.335, the Congressional effort to establish national standards for
     Over the past year, USPE representatives met with various Attorneys
 General to discuss the sweepstakes issue.  We paid attention to what was said
 at those meetings and incorporated those discussions into the unprecedented
 changes that we were already making in our company.  Over the same period,
 USPE also met with attorneys who filed a lawsuit two years ago on behalf of a
 nationwide class of USPE customers.
     Settlement of the class action litigation and an Agreement with the
 Attorneys General were reached virtually simultaneously.  The class action
 settlement has received preliminary court approval, and a nationwide consumer
 class has been certified by the court.
     This global settlement with the State governments and private parties will
 provide approximately $50 million from which refunds to USPE customers will be
 paid.  This includes more than $30 million distributed by the states and the
 District of Columbia, and an additional $20 million to fund court-approved
 distribution to customers.
     The Agreement that was reached with the Attorneys General, and the
 settling of the Class Action lawsuit, has greatly reduced the company's
 resources and USPE has also recently gone through significant downsizing.
 However, these settlements allow USPE to continue to serve our satisfied
 customers with our mailings offering a variety of merchandise products.
     Background Information
     United States Purchasing Exchange has been in business for more than
 40 years and sells hundreds of merchandise items in its catalogs.  Since 1967,
 the company has also offered many different sweepstakes and premium programs.
 Over the years, USPE has awarded tens of thousands of sweepstakes prizes to
 customers throughout the United States.  Consistent with all sweepstakes
 programs, people do not have to order items from USPE catalogs in order to
 enter the sweepstakes, in fact, many of the entrants do not order merchandise.

SOURCE United States Purchasing Exchange