iMergent Provides Update on Australia
May 06 2010 - 8:00AM
iMergent, Inc. (AMEX:IIG), a leading provider of eCommerce
software, site development, web hosting and search engine
optimization for businesses and entrepreneurs, today announced that
the Federal Court of Australia, New South Wales, entered an Order
on the remaining issue outstanding from a 2007 law suit filed by
the Australian Competition and Consumer Commission (ACCC) against
iMergent ( the "Company").
The ACCC in a 2007 action alleged violations of an earlier
settlement. The suit alleged that the Company had (i) failed to
notify the ACCC of seminars held in Australia; (ii) failed to
provide copies of tapes of seminars to the ACCC when requested;
(iii) failed to notify purchasers of the three-day cooling-off
period (right to rescind); and (iv) failed to provide certain
disclosures relating to the software, which were enumerated in the
previous agreement. The ACCC also alleged that the prior sales
offer, which had been discontinued prior to the suit, whereby the
Company compared the price of the software package sold at the
Workshop to a list price available to attendees for 90 days (the
"90 day offer") was deceptive.
The prior settlement resolved issues related to the manner in
which sales disclosures are made in Australia, compensation of
Australian purchasers and all fees and costs incurred by the ACCC
relating to the legal proceeding which occurred prior to December
1, 2009.
The Court has found that the "90 day offer" was misleading, it
found the Company did not intend to sell software at its list price
and that therefore comparing the price of the software sold at the
Workshop to a list price was misleading or deceptive.
The Company disputed the position of the ACCC and argued that a
list price or comparison to an MSRP is not in any manner
misleading. The Company does not expect this ruling to have an
economic impact on the Company as the prior settlement resolved
issues of restitution as well as costs and fees up to the final
submission of written evidence on this issue. The Company is not
limited in holding workshops in Australia.
Jeffrey G. Korn, iMergent's Chief Legal Officer
commented, "We vehemently disagree with the reasoning of the
Court. The "90 day offer" was not intended to mislead customers; it
was presented as essentially an MSRP/list price which to us was not
unlike a car manufacturer who rarely if ever sells at list price.
We always made clear to customers that it was our intention to sell
the software package at the Workshop, and not sell at the "list
price." Selling with a time sensitive discount is a very
standard sales practice and we believe it was inappropriate to
conclude that such a sale was misleading or in any manner
deceptive. The ruling has no current effect on the Company or
its customers, as the Company did away with the "90 day
offer" more than three years ago - which was before the
allegations by the ACCC or the filing of the law suit. The
discontinuance of the offer had nothing to do with the claims by
the ACCC, we found the offer was confusing to customers and
actually impeded the sales process as opposed to supporting
it."
Korn added, "We made clear to the ACCC and the Court that the
sales practice was something we had discontinued. We further
agreed that the sales tactic would not be reintroduced. We
unfortunately believe the fact that the "90 day offer" had in fact
been discontinued may ironically have made it easier to enter a
ruling that it was misleading. The prior settlement with the
ACCC resolved restitution and this ruling will have minimal
financial impact on the Company as the only costs and fees which
can be entered relate to the time period after the settlement,
and those costs and fees are minimal. StoresOnline has made
great strides over the last several years in improving its sales
process and attempting to be transparent to its customers, those
processes were in place well before the law suit by the ACCC, and
continues on an ongoing basis."
About iMergent
iMergent provides eCommerce solutions to entrepreneurs and
businesses enabling them to market and sell their business products
or ideas via the Internet. The company sells its proprietary
software and training services which help users build Internet
strategies to allow entrepreneurs and businesses to market and sell
their products, accept online orders, analyze marketing performance
and manage pricing and customers over the Internet. In addition to
software and training, iMergent offers site development, web
hosting and search engine optimization (SEO). iMergent,
StoresOnline and Crexendo Business Solutions, Inc. are trademarks
of iMergent, Inc.
Safe Harbor Statement
This press release contains forward-looking statements. The
Private Securities Litigation Reform Act of 1995 provides a "safe
harbor" for such forward-looking statements. The words "believe,"
"expect," "anticipate," "estimate," "will" and other similar
statements of expectation identify forward-looking statements.
Specific forward-looking statements in this press release include
information about iMergent, (i) belief that "90 day offer" was
not intended to mislead customers and it being presented as
essentially an MSRP/list price which to us was not unlike a car
manufacturer who rarely if ever sells at list price, (ii) selling
with a time sensitive discount being a very standard sales practice
and that it was inappropriate to conclude that such a sale was
misleading or in any manner deceptive, (iii) the discontinuance of
the "90 day offer" having had nothing to do with the claims by
the ACCC and the Company finding the offer was confusing to
customers and actually impeded the sales process as opposed to
supporting it, (iv) the ruling having minimal financial impact on
the Company, (v) StoresOnline having made great strides over
the last several years in improving its sales process and
attempting to be transparent to its customers and (vi) those
processes being in place well before the law suit by the ACCC,
and continuing on an ongoing basis.
For a more detailed discussion of risk factors that may affect
iMergent's operations and results, please refer to the Company's
Form 10- KT for the six months ended December 31, 2009 and the
Company's form 10Q for the period ended March 31, 2010. These
forward-looking statements speak only as of the date on which such
statements are made, and the company undertakes no obligation to
update such forward-looking statements, except as required by
law.
CONTACT: iMergent, Inc.
Steven G. Mihaylo, CEO
775-530-3955
Stevemihaylo@imergentinc.com
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