Oct 25 2004
Illinois Attorney General Lisa Madigan has announced a suit filed earlier this week in federal court against a dental supply firm for a scam in which the company allegedly made unsolicited telemarketing calls to unsuspecting dentists, sent dental needles that were never ordered and then harassed the dentists with threats of legal action for non-payment. At least two Illinois dentists were caught up in the scheme.
Tradeway, Inc., of Palcentia, California, d/b/a Nationwide Dental Supply (Nationwide), and its president, Ian Huang, are named in the four-count consumer fraud complaint filed Tuesday, October 19, in U.S. District Court in Chicago. According to Madigan's complaint, Nationwide representatives call an office and imply they are a dentist's regular supplier, have previously done business with the dentist and are verifying an order or informing the dentist they are shipping a free sample. In many cases, the shipment of needles arrived and later an invoice containing substantially higher prices than dentists would pay to their regular suppliers was received. In other cases, only an invoice – and no needles – was received.
“Our office has received numerous referrals and complaints from the American Dental Association and the Better Business Bureau about this outfit,” Madigan said. “We have learned a great deal about Nationwide's unfair and deceptive tactics.”
In one case, Nationwide representatives allegedly did not identify themselves during a telephone call and pretended to be a dentist's regular supplier to find out from his assistant the type of needles used in his office. Approximately one week later, he received a package of needles that were never ordered along with an invoice. His office manager refused the package and called the defendant about the invoice. The call was directed to customer service, but no representative was available and a message left by the office manager was never returned.
Another Illinois dentist complained that Nationwide called last April to announce a product line change. A dental assistant agreed to accept a free sample, but a few days later, the defendant sent a bill for dental needles never authorized or received. That dentist also tried contacting Nationwide but did not hear back. In June, the dentist refused when the defendant called demanding payment for the needles which were never received. A few days later, a box of needles was received, and returned, by the dentist.
Madigan's suit charges Nationwide with violation of the Federal Trade Commission (FTC) Telemarketing Sales Rule for failure to disclose its identity, the purpose of the call and nature of the goods, misrepresenting the goods and refund policy, and making false and misleading statements to induce payment. Additionally, Madigan's suit charges Nationwide with violating the Illinois Consumer Fraud and Deceptive Business Practices Act.
Madigan's suit seeks to prohibit Nationwide from further violations of the FTC Telemarketing Rule and Illinois consumer protection laws and asks the court to impose a civil penalty of $50,000 and costs.
Assistant Attorney General Monica Grubbs is handling the case for Madigan's Consumer Fraud Bureau.