Publishers Clearing House agreed to pay $34 million in a deal with 26 states Tuesday to settle allegations the sweepstakes company employed deceptive marketing practices.
As part of the settlement, the company will no longer use phrases like ``guaranteed winner.''
``This will in fact revolutionize the sweepstakes industry,'' Michigan Attorney General Jennifer Granholm said.
Publishers Clearing House will have to pay $34 million in customer refunds, legal expenses and administrative costs to the states. Each state's share has yet to be determined.
State attorneys general had sued Publishers Clearing House, accusing it of deceptive marketing for its sweepstakes promotions. The suit alleged that the company was misleading consumers by making them believe they had won prizes or would win if they bought magazines from Publishers Clearing House.
Publishers Clearing House reached an $18 million settlement last August with 24 other states and the District of Columbia, though the other states opted not to join.
The states involved in the latest settlement are: Arizona, Arkansas, Colorado, Connecticut, Delaware, Florida, Indiana, Iowa, Kansas, Kentucky, Maine, Maryland, Massachusetts, Michigan, Minnesota, Missouri, New Jersey, North Carolina, Oregon, Pennsylvania, Rhode Island, Tennessee, Texas, Vermont, West Virginia and Wisconsin.
In 1999, another sweepstakes company, American Family Enterprises, settled a group of lawsuits for $33 million. That company is known for the American Family Publishers sweepstakes plugged by Dick Clark and Ed McMahon.