Business Blog
Company claimed “Ships Tomorrow,” but where were the masks and respirators?
An online company advertising consumer goods, including personal protective equipment like masks and respirators, does business under the name SuperGoodDeals.com. But based on the illegal conduct alleged in a lawsuit just filed by the FTC, maybe it’s because the URL SuperDeceptivePractices.com was already taken.
New York-based SuperGoodDeals.com, Inc., and Kevin J. Lipsitz sell charger cables, clothing, health and beauty products, and other consumer goods through their website. In March 2020, they began to market masks, respirators, and other products that help protect against COVID-19. The company advertised “Pay Today, Ships Tomorrow” on multiple places on its site, including in a prominent banner. Many pages on its site advertising protective equipment included the claim “In Stock – Pay Today, Ships Tomorrow! Going Fast!” The company underscored that representation on its “Shipping & Deliveries” page, stating “We pride ourselves on fast order processing. Pay Today, Ships Tomorrow!”
At a time when consumers needed essential protective products to combat COVID-19 but found most other retailers out of stock, the FTC alleges the defendants’ claims about product availability and fast shipping were highly material. Indeed the FTC says that demonstrates why, at least in part, consumers relied on those next-day shipping representations. But according to the complaint, the defendants’ promises were false. In numerous instances, the defendants generated a United States Postal Services shipping label within one day, but waited weeks to get the ordered products to the post office for shipping.
The complaint cites examples of how the defendants’ claims affected consumers. On March 23, 2020, one consumer spent $135 on four 50-packs of disposable masks for child welfare workers making in-home visits. Despite paying extra for overnight shipping, a week passed and the person hadn’t received the items. Another customer ordered masks on March 21st for a family member who is a nurse and paid for two-day shipping, but hadn’t received the masks as of April 4th. A third customer ordered masks on March 31st for her immunocompromised mother and grandmother. Two weeks passed and no masks.
Compounding consumers’ frustration was the defendants’ claim on their website that they responded to consumer inquires “within 1 business day or less.” According to the lawsuit, dozens of consumers complained to the FTC and to the Better Business Bureau when the defendants didn’t respond to emails, phone calls, or chat messages.
COVID-19 issues aside, SuperGoodDeals advertised many of the items on its site as “authentic” or “certified.” For example, the defendants claimed to sell Yeti branded vacuum insulated tumblers and featured the word “AUTHENTIC” next to a picture of the product. But the FTC says in many instances, consumers received counterfeit merchandise.
Count 1 of the complaint alleges the defendants violated the FTC Act by deceptively claiming to ship items within one business day and by falsely representing the items they sold were authentic, certified, or specifically branded. Count 2 specifies the multiple ways in which the FTC says the defendants’ business practices violated the Mail, Internet, or Telephone Order Merchandise Rule.
While the case is pending in federal court in New York, here are two points for other businesses to consider.
Your shipping promises are highly material to consumers. The COVID-19 crisis has underscored just how important shipment representations are to people for whom home delivery has become a literal lifeline. Have you given your website a recent once-over to make sure you can back up what you claim?
If the unexpected happens, follow the Mail, Internet, or Telephone Order Merchandise Rule’s if-then requirements. The Rule requires prompt shipment, but also lays out specific steps to follow if you experience a hiccup in your supply chain. The FTC’s Business Guide to the Rule explains the alternatives, but let’s be clear: Making shipment claims without sound support to back them up and then simply ignoring your promises to customers isn’t among the options and violates federal law.
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