IN THE CIRCUIT COURT OF PULASKI COUNTY, ARKANSAS DIVISION. STATE OF ARKANSAS ex rel. DUSTIN MCDANIEL, ATTORNEY GENERAL

Transcription

1 IN THE CIRCUIT COURT OF PULASKI COUNTY, ARKANSAS DIVISION ELECTRONICALLY FILED 2014-Jun-23 08:33:02 60CV C06D06 : 18 Pages STATE OF ARKANSAS ex rel. DUSTIN MCDANIEL, ATTORNEY GENERAL PLAINTIFF v. CASE NO. ROGER D. PLEASANT, an Individual, INFORMATION AND DISCOVERY, INC., an Arkansas Corporation; PSG AND INVESTIGATION LLC, an Arkansas Limited Liability Company; ACCIDENT CLAIM SERVICE, LLC, an Arkansas Limited Liability Company; PHYSICIAN 1ST MARKETING GROUP, LLC, an Arkansas Limited Liability Company; NETWORK COLLISION GROUP, LLC, an Arkansas Limited Liability Company ROGERICK PLEASANT, an Individual, JAMES JIMMY HINTON, an Individual; and BRIAN HINTON, an Individual. DEFENDANTS COMPLAINT The State of Arkansas ex rel. Dustin McDaniel, Attorney General, and for its Complaint against Defendants states: I. INTRODUCTION 1. This is a consumer protection action brought to redress and restrain violations of the Arkansas Deceptive Trade Practices Act, Ark. Code Ann through Defendants solicit auto accident victims by phone and in-person on behalf of local chiropractors, often using false identities and falsely claiming to represent an insurance company, with the assurance of helping the accident victim get an insurance settlement and medical benefits in exchange for a share of the

2 insurance claim paid to the chiropractor who treats the accident victim. This activity harasses and deceives auto accident victims, sometimes leads to unnecessary chiropractic treatment that makes consumers subject to medical liens filed by chiropractors, and endangers the health of accident victims by steering accident victims to chiropractors rather than medical doctors regardless of the accident victim s clinical needs. 3. The State seeks an injunction, an order imposing civil penalties, and other relief against the Defendants for violations of the Arkansas Deceptive Trade Practices Act outlined herein. II. PARTIES 4. Plaintiff is the State of Arkansas ex rel. Dustin McDaniel, Attorney General (hereinafter the State ). Attorney General McDaniel is the chief legal officer of the State of Arkansas. Pursuant to Ark. Code Ann , the State, through the Attorney General, may seek civil enforcement of the Arkansas Deceptive Trade Practices Act ( DTPA ). 5. Defendant Roger Pleasant is an Arkansas resident who resides at 20 Leeward Court, Maumelle, AR Defendant Roger Pleasant participates and manages other employees in direct marketing of chiropractic clinics to automobile accident victims in exchange for a fee paid by chiropractic clinics. Defendant Roger Pleasant operates his business under a number of unincorporated names, including Information & Discovery Consultant Firm, Inc., Professional Service Group, Inc., 2

3 Progressive Marketing Group, Physicians Treatment Centers of America, The Doctors Group LLC, and Concerned Citizens of Arkansas. 6. Defendant Information and Discovery, Inc. is an Arkansas corporation, originally registered with the Arkansas Secretary of State on April 18, 1996 and is listed as revoked as of the present date. According to its filing with the Secretary of State, Roger Pleasant is listed as its registered agent, at an address of 400 West Capitol, Suite 1743, Little Rock, AR Defendant PSG and Investigation LLC (hereinafter PSG or Defendant PSG ) is an Arkansas limited liability company, originally registered with the Arkansas Secretary of State on April 19, 2005 and in good standing as of the present date. According to its filing with the Secretary of State, Roger D. Pleasant is listed as its registered agent, at an address of 2725 Cantrell, Suite 204, Little Rock, AR Defendant Accident Claim Service, LLC is an Arkansas limited liability company, originally registered with the Arkansas Secretary of State on September 22, 2011 and listed as revoked as of the present date. According to its filing with the Secretary of State, Roderick Pleasant is listed as its registered agent, at an address of 2725 Cantrell, Little Rock, AR Defendant Physician 1st Marketing Group, LLC is an Arkansas limited liability company, originally registered with the Arkansas Secretary of State on July 11, 2011 and listed as revoked as of the present date. According to its 1 It is believed that the name of the agent, Roderick Pleasant, is misspelled and should in fact be listed as Rogerick Pleasant. 3

4 filing with the Secretary of State, Roger Pleasant is listed as its registered agent, at an address of 3221 Barrow Road, Suite B, Little Rock, AR Defendant Network Collision Group, LLC is an Arkansas limited liability company, originally registered with the Arkansas Secretary of State on March 6, 2013 and listed in good standing as of the present date. According to its filing with the Secretary of State, Roger Pleasant is listed as its registered agent, at an address of 2725 Cantrell Road, Suite 105B, Little Rock, AR Defendant Rogerick Pleasant, is an Arkansas resident who resides at 20 Leeward Court, Maumelle, AR Defendant Rogerick Pleasant is Defendant Roger Pleasant s son and participates in direct marketing of chiropractic clinics to automobile accident victims in exchange for a fee paid by chiropractic clinics and is an employee of Defendants Roger Pleasant, Information and Discovery, Inc., PSG and Investigation, LLC, Accident Claim Service, LLC, Physician 1st Marketing Group, LLC and Network Collision Group, LLC. 12. Defendant James Jimmy Hinton is an Arkansas resident who resides at 1605 Welch Street, Little Rock, AR At all times relevant to the present matter, Defendant James Hinton has been an employee of Defendants Roger Pleasant, Rogerick Pleasant, Information and Discovery, Inc., PSG and Investigation, LLC, Accident Claim Service, LLC, Physician 1st Marketing Group, LLC, Network Collision Group, LLC. Defendant James Hinton participates in direct marketing of chiropractic clinics to automobile accident victims in exchange for a fee paid by chiropractic clinics. 4

5 13. Defendant Brian Hinton is an Arkansas resident who resides at 12 Connolly Court, Little Rock, AR At all times relevant to the present matter, Defendant Brian Hinton has been an employee of Defendants Roger Pleasant, Rogerick Pleasant, Information and Discovery, Inc., PSG and Investigation, LLC, Accident Claim Service, LLC, Physician 1st Marketing Group, LLC, Network Collision Group, LLC. Defendant Brian Hinton participates in direct marketing of chiropractic clinics to automobile accident victims in exchange for a fee paid by chiropractic clinics. 14. At all times relevant to this Complaint, acting alone or in concert with others, Defendant Roger Pleasant has formulated, directed, controlled and participated in the business of Information & Discovery, Inc., Information & Discovery Consultant Firm, Inc., Physician 1st Marketing Group, LLC, Accident Claim Service, LLC, Professional Service Group, Inc., Progressive Marketing Group, Physicians Treatment Centers of America, The Doctors Group LLC, Concerned Citizens of Arkansas, PSG and Investigation LLC, and Network Collision Group, LLC to such a degree that, pursuant to Arkansas Code Annotated (d), Defendant Roger Pleasant is personally liable for the deceptive, unconscionable and otherwise unlawful acts and practices of those entities, as described herein, in addition to being personally liable for his own acts, omissions and practices as incorporator, organizer or owner of said business entities and companies, which operate within the State of Arkansas. Accordingly, with respect to Rogerick Pleasant, James Jimmy Hinton, Brian Hinton, Information and Discovery, Inc., 5

6 PSG and Investigation, LLC, Accident Claim Service, LLC, Physician 1st Marketing Group, LLC, and Network Collision Group, LLC, Defendant Roger Pleasant is a controlling person within the meaning of Ark. Code Ann (d). III. JURISDICTION AND VENUE 15. This Court has subject matter jurisdiction over this matter pursuant to the Arkansas Deceptive Trade Practices Act, Ark. Code Ann The Court has personal jurisdiction over Defendants because the Defendants actively conduct business in the State of Arkansas and intentionally avail themselves of business within the State. Defendants activities include soliciting auto accident victims, referring them to chiropractic or physical therapy clinics in exchange for a monetary payment, and providing other services (including transportation, auto accident reports, etc.) to accident victims. 17. Venue is proper pursuant to Ark. Code Ann and (2009 Supp.) and the common law of the State of Arkansas. IV. FACTUAL ALLEGATIONS 18. Defendants enter into business relationships with local chiropractors in order to solicit and produce auto accident victims as patients to the chiropractors in exchange for a fee. Individuals who engage in this activity are sometimes called runners and sometimes called marketers or solicitors. Typically, the compensation agreement for these arrangements requires that the solicited patient be treated at the clinic between three and five times before the chiropractor will compensate the marketer. 6

7 19. In order to carry out their work, Defendant Roger Pleasant and his staff first obtain automobile accident reports from local police stations and Internet websites on a daily basis. 20. Defendant Roger Pleasant and his staff review the auto accident reports and note several pieces of information: the amount of vehicle property damage, whether the victim was injured in the crash, the race of the victim (e.g., African-American, Hispanic, Caucasian, etc.), existence of insurance coverage, name of insurance company, number of occupants of the crashed vehicle, and the address and telephone numbers of the accident victims. 21. Based upon this review, Defendant Roger Pleasant then assigns each auto accident victim to his employees, including himself, Defendants Rogerick Pleasant, Brian Hinton and James Hinton among others. This assignment contains the victims information and the accident information obtained from the report. 22. Upon receiving their assignments, individual marketers begin telephoning accident victims or visiting their residences in-person and soliciting each accident victim s business on behalf of a chiropractic clinic. 23. These telephone and in-person visits are conducted at all times of the day, including early morning hours and late at night, regardless of the annoyance and inconvenience to the accident victims. Defendants sometimes visit auto accident victims at their places of work in order to solicit their business. 7

8 24. Arkansas consumers have filed complaints with the Arkansas Attorney General s Office and the Arkansas State Board of Chiropractic Examiners complaining of Defendants business activities. 25. Consumers have complained that in the days following an auto accident, an accident victim who elects to include their telephone number on the accident report will likely receive several harassing phone solicitations from Defendants or other individuals trying to steer the accident victim to a specific chiropractic clinic. 26. When speaking with auto accident victims, Defendants employ various deceptive and misleading communication strategies, some of which are outlined below. 27. Defendant Roger Pleasant and his employees sometimes use false names when contacting auto accident victims, including Danny King, Reggie and Rod among others. Accordingly, this tactic disguises their true identities and causes consumers difficulty in trying to understand who contacted the consumer and in what capacity. 28. Defendants typically give consumers advertising literature purporting to provide a list of services to consumers. These offers are misleading in a number of ways. By offering a ten-point physical evaluation for injuries at no charge, Defendants imply both that they are qualified to provide medical services and advice and that the consumer will incur no cost. 8

9 29. Printed advertising materials distributed to auto accident victims by Defendants also claim that Defendants can activate insurance claims with insurance claims representatives. Such an implication of association with or agency for insurance companies is a deceptive tactic that occurs over and over again throughout Defendants business practices. 30. Defendants offer, via printed material, to set up rental car arrangements and provide free accident reports to victims. Again, Defendants claim to provide services that are traditionally provided by an at-fault insurance carrier, further misleading consumers. 31. During the solicitation contact, Defendants do not explain to accident victims that Defendants will be compensated handsomely by a chiropractor if the Defendant successfully gets the auto accident victim to be treated by that chiropractor. 32. In order to facilitate a visit to a specific chiropractic clinic, Defendants offer to provide transportation to doctor s appointments. 33. In order to drum up additional business, Defendants offer current clients something referred to as bonus points in exchange for referring friends. 34. Defendant Accident Claim Service, LLC advertised that it help[s] people recover what they deserve from car accidents. This claim is very similar, and in some instances nearly identical to, the offers of attorneys who seeks accident victims as clients. It implies that Defendants can work on behalf of consumers during negotiations and act as the consumer s proxy during all recovery activities. 9

10 35. Defendants use deceptive titles when communicating with consumers. On his business cards and advertising material, Defendant Roger Pleasant has utilized such job titles as Accident Specialist, Consultant/Paralegal, Authorized Independent Agent, and Accident Consultant. These titles suggest that he works for an insurance company or law firm, even though Defendant Roger Pleasant is neither an insurance agent nor an attorney. Defendant Roger Pleasant instructs his employees to use the same kind of misleading terminology. The use of these deceptive titles is confusing for consumers, who may legitimately think that they are doing business with someone who is qualified or licensed to provide services that only an insurance company representative or attorney could provide. 36. Defendants sometimes tell consumers that they work for the at-fault party s insurance carrier (e.g., Geico, Allstate, State Farm, etc.), a representation which is always false. 37. In addition to this blatant lie, Defendants also utilize language conveying that a relationship exists between them and the at-fault driver s insurance company even though no such relationship exists. 38. For example, auto accident victims report that Defendants told the accident victim that he or she needed to come to a specific chiropractic clinic because the clinic was a preferred provider with the at-fault driver s insurance. Such an assertion is false in that automobile insurance carriers do not utilize preferred medical provider networks like health insurance companies do. 10

11 39. Defendants have told victims that they work in conjunction with [a specific insurance carrier], on behalf of [a specific insurance carrier], with [a specific carrier], and et cetera. The use of such words and phrases, without clarification, leaves auto accident victims with the impression that Defendants work under the auspices of an insurance company. These assertions are patently false and misleading and are used for the sole purpose of coercing a victim through the doors of a specific chiropractic clinic. Many auto accident victims were led to believe that they had no choice but to follow the directives of the Defendants in order to secure whatever insurance benefits to which the victim might be entitled. 40. Defendants have told consumers that an at-fault driver s insurance would pay for the claim even though the carrier had not yet given notice of acceptance of liability. 41. Defendants offered cash payments to auto accident victims in order to entice victims to be treated at specific chiropractic clinics. Sometimes, Defendants offered these payments in the form of $200 gift cards. 42. Accident victims report that Defendants instructed them that the only way to get an insurance settlement check for their auto property damage claim was to be seen at a particular chiropractic clinic. 43. Defendants sometimes told auto accident victims that they should not go to their medical doctors because of the supposed complications of health insurance claims but should instead go to the Defendants associated chiropractic clinic because there would be no bills. Similarly, an accident victim has reported 11

12 that Defendants told the victim that chiropractic care is sufficient in place of review by a medical doctor following possible injuries the victim sustained in the recent auto accident. This misinformation could potentially lead to serious health consequences for some victims who may forego needed medical attention based upon Defendants assertions. And, of course, despite Defendants assertions to the contrary, there are always bills for treatment. 44. Defendants sometimes told auto accident victims that they were required to be checked by a specific chiropractor or chiropractic clinic even though auto insurance companies do not require crash victims to obtain such treatment following an auto accident. 45. Auto accident victims have reported that Defendants promised to assess and estimate the auto accident victim s vehicle for the level of damage outside the chiropractic clinic while the victim was being treated inside the clinic. This practice gives the accident victim the false impression that the marketer is authorized by an insurance company to make such damage valuations and to provide estimates when Defendants are not authorized to give such estimates, whether written or oral. 46. In some cases, consumers are harmed when left with bills from a clinic that they cannot pay and did not think they were incurring. Following treatment, the chiropractic clinic typically files a medical lien against the auto accident victim s right to payment from the insurance settlement, if any, resulting from the auto accident insurance claim. Consumers have complained that these lien amounts 12

13 exceeded the treatment amounts approved by the insurance company and left the auto accident victim with the responsibility to pay the bill to the chiropractic clinic. The excessive claims for chiropractic services interferes with the ability of the victim to obtain settlement of his insurance claim, and can result in a lower recovery for the victim. V. VIOLATIONS OF LAW 47. Ark. Code Ann through 115, otherwise known as the Arkansas Deceptive Trade Practices Act ( DTPA ), sets forth the State s statutory provisions prohibiting deceptive and unconscionable trade practices. 48. Defendants business practices constitute the sale of goods or services within the meaning of Ark. Code Ann (6) and (7). These same business practices constitute business, commerce, or trade within the meaning of Ark. Code Ann Arkansas Code Annotated (a)(1) provides that it shall be unlawful to knowingly mak[e] a false representation as to the characteristics, uses, benefits, alterations, source, sponsorship, approval, or certification of goods or services, or as to whether goods are original or new, or of a particular standard, quality, grade, style, or model. Defendants have engaged in prohibited conduct by knowingly: a. disguising their names and identities from auto accident victims; b. telling the victims that Defendants were with an insurance company when such is not the case; 13

14 c. implying an agency role with an insurance company by telling accident victims that Defendants worked under the auspices of, on behalf of, or in conjunction with an insurance company when Defendants had no such relationship with an insurance company; d. assuming titles such as Accident Specialist, Consultant/Paralegal, Authorized Independent Agent, Accident Consultant, which imply an insurance company or law firm relationship when Defendants had no such role; also, when using the title paralegal, the Defendants falsely represented that they were authorized to provide legal advice and services; e. telling auto accident victims that chiropractic care would be free or no cost when such treatment actually generates a bill and an insurance claim is recorded for that individual as well as a medical lien filed against the insurance proceeds; f. telling auto accident victims that they were required to be seen by a chiropractor in order for a claim to be paid; and g. for other reasons that will or may be discovered. 50. Arkansas Code Annotated (a)(10) provides that it shall be unlawful to engage in unconscionable, false, or deceptive acts or practices in business, commerce, or trade. The Defendants have engaged in prohibited conduct by knowingly: 14

15 a. engaging in coercive sales tactics by intrusively visiting auto accident victims at their places of residence at all hours of the day and night without invitation; b. contacting auto accident victims by telephone during early morning hours and other times with deceptive sales pitches; c. misrepresenting information to Arkansas consumers concerning Defendants identities and relationship to insurance carriers; d. representing to auto accident victims that their insurance claim was approved or covered, or stating that it would be covered, before liability had been accepted; e. falsely informing auto accident victims that chiropractic treatment was required before an insurance settlement could be paid for auto property damage; f. telling potentially injured auto accident victims that treatment by a medical doctor was unnecessary; and g. deceiving consumers by advising accident victims regarding rights and monetary recovery following an accident, advising accident victims about the value of their loss and estimating insurance settlement amounts, and soliciting consumers in person and by phone regarding these legal matters, 51. Ark. Code Ann prohibits the use of concealment, suppression, or omission of any material fact in connection with the sale or 15

16 advertisement of any goods and services. The Defendants have engaged in prohibited conduct by knowingly: a. failing to disclose their true identities to auto accident victims that they contacted; b. failing to explain to accident victims that a medical lien might be filed against them for obtaining treatment at a chiropractic clinic; c. failing to disclose to the accident victim that Defendants will be compensated by the treating chiropractor if the victim is treated by the chiropractor following the Defendants solicitation effort; and d. failing to disclose to accident victims that chiropractic care is not free of charge and that the auto accident victim may end up with a medical bill; and e. omitting to disclose to consumers that Defendants are not licensed attorneys or supervised by licensed attorneys when offering legal counsel and advice. VI. PRAYER FOR RELIEF 52. Pursuant to Arkansas Code Annotated (a)(1), the Attorney General may bring a civil action to seek to prevent persons from engaging in the use or employment of prohibited practices. 53. Under the provisions of Arkansas Code Annotated and (a)(1), the Attorney General may seek an injunction prohibiting any person from engaging in any deceptive or unlawful practice. 16

17 54. Pursuant to Arkansas Code Annotated (a)(3), any person who violates the provisions of the Arkansas Deceptive Trade Practices Act may be assessed a civil penalty of up to $10,000 per violation. 55. Arkansas Code Annotated (d)(1) provides that every person who directly or indirectly controls another person who is in violation or liable under this chapter... shall be jointly and severally liable for any penalties assessed and any monetary judgment awarded in any proceeding for civil enforcement. 56. In addition, under the provisions of Arkansas Code Annotated (e), any person who violates the provisions of the Arkansas Deceptive Trade Practices Act shall be liable to the Office of the Attorney General for all costs and fees, including but not limited to, expert witness fees and attorney s fees, incurred by the Office of the Attorney General in the prosecution of such actions. 57. A person is an individual, organization, group, association, partnership, corporation, or any combination thereof. Ark. Code Ann (5). Defendants are persons who have engaged in an unconscionable, false, or deceptive act or practice in business, commerce, or trade. 58. Plaintiff demands a trial by jury. WHEREFORE, the above premises considered, the State of Arkansas ex rel. Dustin McDaniel, Attorney General, respectfully requests that this Court: (A) Issue such orders, pursuant Ark. Code Ann and (a)(1), as the Court may deem necessary to prevent the use or 17

18 employment by the Defendants of the practices described herein which are violations of the Arkansas Deceptive Trade Practices Act; (B) Impose civil penalties pursuant to Arkansas Code Annotated (b), to be paid to the State by the Defendants in the amount of $10, per each violation of the Arkansas Deceptive Trade Practices Act proved at a trial of this matter, the full amount of which will exceed the amount necessary to establish federal diversity jurisdiction. (C) Issue an order, pursuant to Ark. Code Ann (e), requiring the Defendants to pay the State s costs in this investigation and litigation, including, but not limited to, attorney fees and costs; and (D) For all other just and proper relief to which the Plaintiff may be entitled. Respectfully Submitted, DUSTIN MCDANIEL Attorney General By: Shawn J. Johnson, Ark. Bar No Assistant Attorney General Arkansas Attorney General s Office 323 Center Street, Suite 500 Little Rock, AR Phone (501) Fax: (501) shawn.johnson@arkansasag.gov 18