American Entertainment Distributors, Inc.
The FTC alleged that American Entertainment Distributors and related defendants sold DVD vending machine business opportunities using unsupported earnings claims. Court orders resolved the action, and the FTC returned more than $5.7 million.
Resolved. Refunded, settled, ceased operating, or the claim did not hold up. Kept for the record.
Identity
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- Registrations
- FTC v. American Entertainment Distributors, Inc. (FTC case 04-22431, 2005)
- Jurisdictions
- United States (federal)
Courts resolved the DVD vending business opportunity case
American Entertainment Distributors and related defendants promoted video rental vending machines as a business opportunity. The FTC alleged that investors paid $28,000 to $37,500 each after being told they could earn $60,000 to $80,000 a year or recover their investment in six to 14 months. According to the FTC, the defendants had no reasonable basis for those claims and all investors lost money.
The FTC filed its law enforcement action in 2005 against five companies and five individuals. By 2011, the U.S. District Court for the Southern District of Florida had entered final orders against nine defendants, including a permanent injunction, five settlements, and three default judgments. Litigation continued against the estate of the tenth defendant until the FTC prevailed in a collection action.
The FTC recovered assets and distributed refunds over several years. It mailed more than $2.9 million in 2012, more than $950,000 in an additional distribution in 2013, and more than $1.8 million in 2014. The three distributions increased the total returned in the matter to more than $5.7 million.
What is not established
The documents state that the consent decrees were for settlement purposes only and did not constitute admissions that the law had been violated. The case also included default judgments and a permanent injunction.
Sources
Every claim above rests on one of these. Open them and check.
- Enforcement action February 17, 2011
- Enforcement action June 27, 2012
- Enforcement action August 29, 2013
- Enforcement action February 12, 2014
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First recorded February 17, 2011 · Last updated February 12, 2014