On September 29, 2016, the FTC obtained a preliminary injunction against three companies and their principals for allegedly impersonating government transportation authorities (such as the U.S. Department of Transportation) to obtain payments for federal and state motor carrier registrations and required reports from commercial truckers and trucking companies. The complaint in FTC v. DOTAuthority.com, Inc. et al. asserts claims under the FTC Act and the Restore Online Shoppers’ Confidence Act (“ROSCA”). The case serves as a useful reminder that the FTC will not shrink from bringing actions where the alleged victims are businesses, rather than consumers.
The FTC alleges that the defendants in DOTAuthority.com used official-looking websites, misrepresented that they were the “compliance unit” for “DOT Authority” or their other official-sounding companies, and falsely threatened the trucking companies with potential civil penalties or fines for non-compliance with registration requirements. The FTC further alleges that the defendants imposed undisclosed service fees, ranging from $25 to over $550, and enrolled customers in a “SafeRenew” auto-renewal program without their knowledge or consent. The ROSCA claim focuses on the allegations concerning this negative option automatic renewal program.
The defendants opposed a preliminary injunction, arguing that their businesses are legitimate permit and registration companies, and that they adequately disclosed that they are not affiliated with any government agencies and that customers would be enrolled in an auto-renewal program. The Southern District of Florida nonetheless granted the preliminary injunction.