A4d settlement with the FTC

As I’m sure most of you already know, we’ve been battling with the FTC for almost 2 years.
And we've FINALLY reached a settlement with them. Whew! And not a single day late on payments to even one publisher.

For those of you that don’t know, the FTC started investigating us back in November of 2010. They gave us no inclination if they were looking to sue us or just wanted to get information. After 1.5 years we found out they wanted to sue us for what our affiliates and merchants had done and we had profited from as well. 6 months later we’ve finally come to a settlement that should be public knowledge tomorrow. All this is most specifically about affiliates that ran news lander traffic to us for things like ****, colon and skincare back in 2008 and 2009.

“Oh no A4D is going out of business and I’m going to lose all my money”

Nope, exactly the opposite is true!

Our case is going to be filed and settled at the same time. Basically they’re filing a suit against us, then right after that the judge will sign the settlement that we negotiated with the FTC. Everything is all negotiated and you’ll find the actual settlement link at the bottom of this email so you’ll have it ever before it’s publicly available.

Another question I’m sure you all are thinking is why are we getting sued? Why didn’t we fight them?

We’ve spent 100’s of thousands of dollars in legal fees making sure that all affiliates and merchants were running compliantly and we were nothing more then an internet service provider. We made no uncompliant creative, we did not suggest that people run things uncompliantly, or do anything else that would have made us anything but a technology service provider..

Their whole legal strategy was based on 2 assumptions:

1. They said we were the affiliate which we were obviously not
2. They said we knew or should have known what was going on, but they had little to no proof to back this up.

So at that point we came to a crossroads.

They offered us two options: They would sue us or we could work on a settlement with them.

We thought we had a very solid case, but fighting that case would have cost us MORE then $1 million dollars in legal fees. And in the end there was no certainty of the outcome. The other major problem with fighting the case is it would have left all of you with a lot of uneasy feelings not knowing what was going to happen.

Therefore when they offered us the opportunity to settle for the same amount as the legal fees would have cost we carefully considered our options. After playing out all scenarios, settling with the FTC was the only thing that made logical sense for the security of our affiliates, and the future of our company.
If you'd like to read more about the complaint that was filed and the stipulated order that was agreed to you can find an intial versions at the links below.
Complaint filed
Stipulated order

So here we are. What now?

Not much is going to change.

Wires will go out today for our weekly publishers like clockwork, and monthlies will go out on the 15th as they always do.

We’ll bring in 2 or 3 new offers each week with good potential and things will continue to grow.

Due to the restrictions set in our FTC order, we’ll no longer be accepting Diet offers on the network.
Other than that, not much is going to change other than an even more diligent focus on creative compliance.

We’ll maintain our industry leading compliance policies, procedures, and education of our affiliate base. We will also help the industry continue to innovate to move it to the next level. Of course, as always, we can’t take any non-compliant creative through our network, but this is nothing new.

As most of you know we’ve always been an innovator in the industry. Long before we ever saw anything from the FTC we were already re-tooling our business to move away from things that had potential problems.

To support this new direction, we’ve recently added 5 new US based employees as well as a development office in Krakow, Poland. Also, our current growth period isn't over, so if you or anyone you know are looking for an opportunity to work with a strong, industry leading company please contact us today.

If you have any questions about the particulars of the settlement, our whole staff is fairly well versed on the situation and will be happy to talk with you.

We look forward to growing our businesses together moving forward into the future.

Success,
Jason Akatiff
President, Coleadium Inc. dba A4D