SANTA MONICA—The Los Angeles County District Attorney’s Office and four other prosecutorial agencies announced on Monday, February 24 that Direct Wines, Inc., and Wine Awesomeness, LLC, settled a consumer protection lawsuit alleging that the companies automatically renewed membership subscriptions in violation of state law.
Prosecutors said the violations involved wines sold by Delaware-based Direct Wines, a wine club marketing company, and Wine Awesomeness, a South Carolina wine retailer, which allowed people to subscribe to wine bottle home deliveries.
In California, businesses must clearly and conspicuously disclose all automatic renewal charges and terms and get affirmative consent of those recurring charges from consumers. Under the terms of the settlement, Direct Wines and Wine Awesomeness have agreed to pay $365,000 and change their sales practices. The companies must also:
- Clearly and conspicuously disclose its automatic-renewal terms
- Charge a consumer’s credit or debit card only when a consumer’s consent has been obtained through a check-box, signature, express consent button or other substantially similar mechanism that must be selected to give consent
- Provide confirmation of transactions after a contract has been made
- Provide a toll-free telephone number, email address, postal address or another cost-effective mechanism for cancellation
- Allow consumers who accept an automatic renew or continuous service to terminate the contract online
- All cancellations must be effective upon request
Direct Wines offers creative design wine servicing, personal wine advising, and wine marketing services through CRM solutions including direct mail, newspaper, online, email and telemarketing. The violations involving Direct Wines occurred between September 1, 2013 and September 27, 2017.
Violations involving Wine Awesomeness occurred between August 7, 2017 and June 20, 2018. The defendants did not admit wrongdoing in the stipulated judgments, but worked cooperatively with prosecutors to amend their business practices to ensure compliance with the state’s automatic renewal laws.
The Los Angeles, San Diego, Santa Clara, Santa Cruz, and Santa Monica City Attorney Offices filed lawsuits against Direct Wines and Wine Awesomeness in Los Angeles County Superior Court.
On February 14, Judge Maureen Duffy-Lewis approved the settlement with Wine Awesomeness. On February 18, Judge Steven J. Kleifield approved the settlement with Direct Wines. Deputy District Attorneys Hoon Chun, Jessie McGrath and Duke Chau of the Consumer Protection Division prosecuted the case.