The Watchdog: Dealer sells a car but later changes its mind

Every so often The Watchdog hears from people who regret buying a car. Maybe they drove home and realized the price was too high. Or they bought the wrong car.

They go back to their dealer and try to return the car. Too bad, so sad. There’s a legal contract, pal. And don’t even think about leaving the car.

If an upset buyer ditches a purchased car, a tow truck comes from the financing company. A black mark for repossession goes on the buyer’s record. But what if it were to happen the other way?

What if a dealer sells someone a car but then a day later gets seller’s remorse? What if a dealer signs a sales contract with a customer and then backs out after their lender doesn’t like the terms?

That’s what’s happening to Sandra Baker, an Arlington resident who works two jobs to save enough money to buy a car. She thought she found her ideal ride at Patterson Kia of Arlington — a 2012 Nissan Sentra for $15,000 that includes an extended warranty.

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High interest at 18 percent, but the best part is no money down. She signed the deal and received the congratulations of the sales staff. When she went back the next day to get it, they wouldn’t give her the car. She was asked to sign a new deal.

The good news was her payments dropped. The bad news was that she was now asked to make a $2,500 down payment and find a co-signer. Baker turned the deal down. A contract is a contract, she said firmly.

The Watchdog discussed the matter with Joe Johnson, general manager at Patterson Kia, and another staffer in the finance department who handled the deal. I learned from them that the documents Baker signed were not final sales agreements but conditional on the availability and approval of outside financing, they said.

The deal was completed late at night after their lender closed. The finance officer guessed what terms would work. But the guess was wrong. They told me that after the lender’s rejection, they were allowed to put the original deal aside and seek a new one.

There was no intent to hurt the customer, Johnson said. “We do everything here by the book.” After we talked, Patterson Kia called Baker and offered her a third deal. This time the offer was a $1,100 down payment. She rejected that offer, too. She likes her original deal with no money down.

“They should honor this,” she says. “It’s not my mistake. If it’s a mistake by their financial officer, I hate it. I’m sorry. But I think they should honor the deal.”

Both sides are at a standoff now. In a phone interview, the dealership’s GM pointed out places in his contract that show Baker didn’t own the car. One document signed by Baker is called a conditional delivery agreement.

It states the deal hinges on whether “final approval of financing is granted by a financial institution.”

That seems clear enough. But North Texas consumer lawyer Jerry Jarzombek reviewed the document for me. He described the language used as “flaky” and pointed to inconsistencies that he said were enough to get the agreement tossed.

Elsewhere in the contract, it states in capital letters, “THIS CONTRACT IS NOT VALID UNTIL YOU AND WE SIGN IT.” Baker signed her name.

But the GM insisted that his dealership did not sign the contract. He’s right. There’s no signature with a pen. But someone stamped the dealer’s name on the line beside the words “Seller signs.” Under federal law, a stamped company name is as good as a signature, Jarzombek said, adding: “They rubber-stamped it. They’ve obligated themselves to deliver the car. They established mutual obligation.”

What can a consumer do? File a lawsuit for breach of contract and possible violations of deceptive trade practice laws.

If a consumer wins, a settlement may include additional money for damages and legal fees. GM Johnson says the language used in his documents is clear. “All I can tell you is, I’m in the car sales business. I’m not a bank. We offered her the terms that the bank made available to her.”

It could be worse. Under Patterson Kia’s conditional delivery agreement, if someone buys a car and drives it off a lot but a lender later doesn’t approve, the buyer has to return the car. If the buyer left a trade-in but that car is gone, Patterson Kia only has to pay the agreed trade-in value to make things right.

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The Watchdog: Stream Energy target of racketeering class-action lawsuit

One of Texas’ best-known electricity companies has been smacked with a major and quite unexpected setback. Stream Energy and its marketing arm Ignite face a class-action lawsuit in a Houston federal court charging that Stream and Ignite sell through a pyramid scheme in violation of federal racketeering laws.

The recipients of any potential settlement include hundreds of thousands of independent associates who worked for Ignite selling Stream electricity contracts between 2005 and 2011.

Houston lawyer Scott M. Clearman, who filed the case, says in a worst-case scenario, if Stream has to pay a major settlement, “It could close the company.”

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Business experts say the ramifications of this lawsuit are so deep that a Stream loss in the case could wreak havoc across the entire multilevel marketing industry.

Chairman and co-founder Rob Snyder tells The Watchdog the suit is “distressing.” The allegations are untrue, he says.

The company is appealing and several Stream officials tell me they expect an appeals court to dismiss the class-action certification. We’ll see.

Snyder says there is no pyramid scheme because the company sells a true product and uses established multilevel marketing systems to build its massive sales force: “We sell electricity, and we pay for word-of-mouth advertising through our associates,” he says.

Clearman’s 5-year-old lawsuit against Dallas-based Stream tells a different story. The lawyer charges that the company’s sales setup benefits those at the top. He cites federal racketeering laws because, he says, phone and mail were used to perpetrate the fraud in a conspiracy led by Stream and Ignite leaders.

Although promises of big income gains are made to bring sales people in, at least 25 percent of those who invest to get started in the sales program don’t make their money back, his lawsuit claims.

Stream chairman Snyder explains that it’s natural for sales team leaders at the top of a hierarchy to make more money than low-level associates.

“Our leaders build sales organizations, and they get a commission on the sale when our customers use electricity,” Snyder says.

The case has attracted little attention. Even a top-ranking Public Utility Commission of Texas official said the agency was not aware of the class-action certification until informed last week by The Watchdog. But the ramifications go much further than Stream alone.

The U.S. Chamber of Commerce and other sales organizations have weighed in with a legal brief. They argue that if the case is successful, businesses using multilevel marketing could face a series of challenges from participants who lose money.

“A wide range of businesses, from mortgage lenders to for-profit colleges would face the risk of being coerced into extortionate settlements without having a meaningful opportunity to present legitimate defenses,” the brief states.

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Stream’s Snyder says, “All you have to do is allege a pyramid scheme and you’ll be presumptively certified as a class-action. Defendant firms are looking down the barrel of a gun.”

Surprisingly, a staunch critic of pyramid schemes — and someone who once predicted Stream’s selling strategy would collapse under its own weight — now defends the company in this situation.

Southern Methodist University marketing professor Daniel Howard says, “The danger in this lawsuit is that if this goes through, it may ruin an entire industry, and it could bring down some pretty reputable companies as well.

“Once you have a class-action lawsuit like this saying there’s a racketeering and corrupt influence, it gives an ugly veneer to an entire industry, and that’s not necessarily true.”

The lawyer suing Stream and Ignite points to a $329 entry fee to join the sales program and a $29 monthly fee to host a sales website. He says many never make their money back. He cites dozens of sales recruitment meetings in the lawsuit where promises of great wealth were made to hopeful participants.

Until now, Stream has been riding high. The company started in 2005 and now has 350,000 Texas customers and 200,000 more electricity customers in New York, New Jersey, Maryland, Pennsylvania and Georgia.

Its marketing materials describe it as “one of the fastest-growing new enterprises in the history of American business” and “the largest network marketer of energy in the world.” The company claims about $6 billion in revenue since it began.

Most of the time, the company has stayed out of trouble. The Texas attorney general’s office has only two dozen complaints on file about the company. However, the PUC fined the company $94,000 in 2011 for numerous violations relating to contracts, marketing, connections and many other state rules.

Another top Stream executive, president Mark Schiro, tells The Watchdog: “We feel strongly that we will ultimately prevail in this case.” The judge’s decision was wrong, he adds. “And nothing has yet to be proven.”

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The Watchdog: JFK launched the U.S. consumer-rights movement

In the billion words written about President John F. Kennedy in these last days, almost everyone has missed one of the most important contributions of his presidency.

JFK is the founder of the American consumer rights movement.

I bet you didn’t know that. Here’s how it happened.

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The year before he died, Kennedy stood before cameras in the Roosevelt Room in the White House and announced his support for changes in law that we take for granted today: truth in lending, pesticide regulations, meat inspections, government approval of pharmaceuticals, product safety and, my favorite, more TV channels.

Kennedy said, “Consumers, by definition, include us all. If consumers are offered inferior products, if prices are exorbitant, if drugs are unsafe or worthless, if the consumer is unable to choose on an informed basis, then his dollar is wasted, his health and safety may be threatened, and the national interest suffers.”

No president had ever talked like that.

Kennedy went further, announcing his consumer bill of rights:

The right to safety. Products should not be hazardous to health or life.

The right to be informed. Consumers should be protected from fraudulent, deceitful or grossly misleading information in advertising and on labels.

The right to choose. Give people a variety of products at competitive prices.

The right to be heard. Consumer interests should be heeded by legislators and policymakers.

Kennedy’s wishes are now enshrined in law.

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The Watchdog: An offer of a free cruise or airline tickets always comes with a catch

The next time you receive an invitation offering a free cruise or airline tickets if you attend a sales seminar with your spouse and your credit card, please do The Watchdog a favor: Remember the Harbin family.

The Harbins, along with thousands of other North Texans, received invites with a return address showing the logo of Royal Caribbean International cruise line. The letters included fake boarding passes with the recipients’ names on them.

The letters were actually from Oasis Getaway, a travel club that opened temporary quarters in a business campus off Southlake Boulevard. Oasis Getaway used the logo until Royal Caribbean lawyers sent a cease-and-desist letter.

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The letters promised a cruise in return for a sales pitch. Kenneth and Jeanne Harbin of Justin like cruises, so they went to Southlake to hear the presentation.

The salesman, Kenneth Harbin recalls, “was slick but believable.”

One salesman was a fast talker from New Jersey who told his personal story. His father left his family. His mother had cancer. He never got to take a vacation. But when he joined the travel program he was now selling, he got to see the world. He’s happily married. Oh, and he’s found Jesus.

And guess what? He sells the same happiness to you for $8,995.

For that one-time payment on a credit card, Oasis Getaway promised to help book vacations around the world at lower prices than generally available.

Oasis Getaway claimed 31 years of travel experience on its website. Actually, the company was only a few months old.

The company sold its services to North Texans by explaining that its partner company purchased vacation packages in bulk and could offer low rates and excellent service for resorts, hotels, cruises, airline tickets and many other travel packages. For families that traveled a lot, the cost would pay for itself in savings, the sales staff promised.

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The Harbins have six children, so they bought seven weeks of condo time, plus the lifetime membership, for a negotiated price of $7,294.

The partner, Reservation Services International of Florida, did provide the Harbins prices that were several hundred dollars lower than what they found on their own and with an actual travel agent.

Oasis offered contracts for lifetime memberships with only a few hundred dollars a year more required for annual dues. Hundreds of Texans paid for memberships, some as low as $3,000, others as high as $10,000.

The Harbins were given five days to cancel. But they didn’t test the service to book vacation trips until a few months later. They said Reservations Services International was slow getting back with price quotes. Sometimes they waited more than a week.

The delays made the Harbins impatient. They booked trips without RSI’s help.

In a protest letter to Oasis Getaway’s owner, the Harbins wrote that they found the membership they bought to be “completely useless so far.”

The Harbins asked for a refund, but they were told the company did not like to give refunds.

So the Harbins researched the company’s owners through state records. Then they filed a small claims lawsuit in an Irving Justice of the Peace court. Oasis Getaway no longer runs sales seminars in Texas, but it lists a residential address in Irving as its current mailing address.

Last week, the Harbins and the Oasis Getaway owners stood in a busy hallway outside the Justice of the Peace court haggling over the amount of a refund.

The owners, Thanh “Tony” Q. Nguyen of Irving and Linh C. Dinh of Duluth, Ga., made the case in the hallway that customers such as the Harbins have the “wrong expectations” about their services.

The Harbins countered that they were only asking for what was promised in the sales seminar.

Dinh has been in the travel business for years. A club he owned in Georgia settled charges of trade and commerce violations for $160,000 in penalties and $35,000 in costs, Georgia records show.

The Georgia Office of Consumer Affairs accused Dinh’s company of misleading customers about the location of travel destinations, not allowing refunds and cancellations, asking customers to pay $249 for free tickets, lying to customers about how the business worked, and using others’ logos to indicate partnerships that did not exist.

The company denied the charges but paid the penalty. As part of that, 43 Georgia customers received refunds of $700 to $7,200.

This time it wasn’t a powerful state agency but Kenneth and Jeanne Harbin. In the hallway, the couple and the owners batted refund numbers back and forth like a tennis rally.

The clincher came when Jeanne Harbin said she didn’t care whether the case went to trial because that would leave a scar on the company’s permanent record that other customers would see.

Hearing that, the owners agreed to refund the Harbins $5,500 in exchange for them dropping the lawsuit. The couple agreed.

Dinh and Nguyen declined to talk to me. “Reporters are never fair,” Dinh said in the parking lot.

Kenneth Harbin’s advice for anyone receiving a come-on with free cruise or airline tickets: “Throw it away.”

Oh, and the Harbins never took the promised free cruise because of paperwork complications.

Read more stories on Watchdog Nation about Oasis Getaway here and here.

In the Know: Tips

Travel clubs are risky. Some who sign a contract after a high-pitched sales seminar later regret it.

Be skeptical of offers of free cruises or airplane tickets in exchange for attending a sales presentation.

Never sign a contract for a travel club immediately after a hard sell. Take the contract home; show it to a lawyer and family members.

If a salesman warns that a deal is no good if you don’t sign immediately, steer clear.

Always check out a club’s reviews on the Internet to find out whether promised services are delivered.

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The Watchdog: Richardson lawyer accuses DirecTV of fraud, conspiracy, racketeering

The man sitting at the counter at Zeke’s Kitchen restaurant in Garland is acting suspicious. He doesn’t want any food but takes a glass of water. He says he’s waiting on a friend, but no one shows up. He asks that the channel be changed on the restaurant TV.

Then the man steps outside and begins taking pictures of the restaurant. When owner Brandon “Zeke” Roberson asks him what he’s doing, the man runs off.

Roberson’s wife, Julie, thinks it’s suspicious enough that she makes a note of it on the restaurant office’s calendar: “Very strange acting man. Ran off when Brandon asked why he was taking pictures outside.”

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Months later, they learn what it’s all about. The man is a fraud investigator for DirecTV, sent to find out if the Robersons are TV signal thieves. Did they sign up for a residential TV account but use it at their commercial establishment?

In June, DirecTV cuts off the restaurant’s service. Then DirecTV’s collection lawyers notify the Robersons that they owe $15,000 in back bills. It’s the darkest day in the restaurant’s history. So much so that the couple have to close the place to catch their breath.

“There are days where you just need to refocus,” a sign on the front door reads. “Hope to see you all Monday when we return with clear eyes and better attitudes.”

The Robersons are certain there’s a misunderstanding. They were never told the difference between a commercial and residential account by the installer. They assumed they had the correct account. They assumed wrong.

To this point, this is a run-of-the-mill business case. Then something unusual happens that changes everything.

The Robersons hire a lawyer, Susan Elizabeth Wright of Richardson, who at first envisions an easy solution. She’ll work to negotiate the final settlement number as low as possible for her clients. They’ll pay something, but her hope is it won’t be much.

Wright begins to research the case, and what she learns is startling. She detects a pattern across the United States of DirecTV installers who, she believes, intentionally mislead business customers into signing contracts for residential accounts without realizing it. Several years later, DirecTV comes after the customers, usually for $15,000 as an initial settlement offer.

Wright sues DirecTV in Dallas County district court on behalf of Zeke’s Kitchen. But this lawsuit doesn’t only challenge DirecTV’s billing practices in the Roberson case. It accuses the satellite television signal provider of fraud, conspiracy and racketeering for its role in a pattern of lawsuits accusing small business owners of stealing TV signals.

The business owners she discovers in her research all have similar stories to that of the Robersons. They believed they were buying the correct commercial signal package for their restaurants, only to get socked later with big back bills.

It’s easy to see the confusion. The contract signed by the Robersons doesn’t clearly show whether it’s a residential or commercial account.

DirecTV spokesman Robert G. Mercer tells The Watchdog: “Using residential programming for commercial purposes is a violation of federal law and our programming agreements. [It’s] unfair to competing bars and restaurants that are paying legitimate commercial rates for their programming.

“We always want to resolve these cases as amicably as possible and that was our intention with Mr. Roberson, until the law firm representing him decided to file a baseless lawsuit, which DirecTV will vigorously defend. DirecTV has filed counter-claims for the unauthorized use and display of its programming.”

DirecTV uses third-party installers, and the one that installed the Robersons’ system on behalf of DirecTV admits he goofed.

In an attempt to get the Robersons off the hook, the installer, Gary Young, owner of Young Ideas, sends an email to DirecTV: “I had just opened my dealership. Went to this guy’s small deli shop and sold him service, not knowing the difference between the commercial and residential as I do now. The customer has no clue also. … I had no intentions of doing wrong. Simply a mistake.”

DirecTV decides to go after the restaurant’s owners anyway.

So Wright, the lawyer, takes on the big company, insisting she can prove a charge as serious as racketeering.

Ohio cafe owners say nobody ever told them the difference between residential and commercial. Same deal for the tavern owner in North Carolina.

Same thing happened at a sushi restaurant in California, a pizzeria in Pennsylvania, another pizzeria in Maine and a Tex-Mex restaurant in Murphy.

“The pattern is clear,” the lawyer says. DirecTV cites a business for $15,000 and then offers to settle for $9,000. In each of these cases, she says, the business owners insisted they sought a proper commercial account, but they apparently were deceived, she says.

In many cases, DirecTV and its collections law firm, Lonstein Law Office of Ellenville, N.Y., have collected settlement money for back payments because settling is often the easiest exit strategy, Wright says. Not her, though. Not this time, she insists.

The lawyer has one more ace in the hole. In 2010, DirecTV signed an agreement with the Texas attorney general that the company would closely monitor its third-party installers to make sure they engage in truthful business practices. Anything short of that is a violation of the agreement.

Young, the installer, and members of the Lonstein law firm did not respond to The Watchdog’s request for an interview.

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The Watchdog: On DART paratransit rides, customers complain of drivers who demean them

“Client states that vehicle was very unclean. Seats were wet and client later realized that she sat in urine.”

“Patron states the driver was very unclean. Patron’s words were ‘That driver needs to take a bath.’”

“Driver smelled of beer. Was going in and out of traffic. No working seatbelts. Driver was extremely rude.”

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I don’t know the names of the people whose complaints are summarized in today’s Watchdog report. Their words follow a subhead labeled “Customer Comments” on complaint forms about Dallas Area Rapid Transit’s paratransit system for the disabled.

These nameless riders have had their identities blacked out on the forms for privacy reasons. This was ordered by the Texas attorney general, who ruled that DART had to give me the forms I requested from May until August — more than a thousand.

The Watchdog asked for the forms to examine the customer service culture of MV Transportation, which holds the year-old contract with DART to run the paratransit system. How severe are the paratransit troubles, as reported by my colleagues, reporters Tom Benning and Brandon Formby?

DART fought the release of the complaint forms, telling the state attorney general in a letter, “The release of the complaints to the general public is of no legitimate concern to the public.”

I beg to differ, and when you read my sampling, you’ll see why.

As Benning previously reported, MV Transportation, which relocated its corporate headquarters to Dallas, paid $238,000 in penalties to DART for program flaws.

MV Transportation released a statement in the name of chief executive R. Carter Pate saying that DART and his company review complaints every week.

“We continue to make progress every month in the passenger complaint area,” the statement said. Company officials declined to sit with me for an interview.

DART said the complaints are raw information taken by dispatchers and have not been verified.

 

Under paratransit rules, disabled riders, some who use wheelchairs or require vehicle lifts, are certified to travel in scheduled trips in vans and taxis for a $3 fee. The service gives 2,500 rides a day and serves 11,000 riders.

Comments in the forms I received are summaries taken by DART customer service representatives about the callers’ laments. Here, in their own words, are samples of what they say:

“Client’s mother states the van was covered in ants. Caller states her daughter has lots of bites.”

“The driver was distracted. Client states the driver kept asking her for her telephone number and asking for a date. Client states she doesn’t want this driver to pick her up anymore.”

“Mother states that her son is in vehicle for over three hours.”

“The operator ran two stop signs in Garland.”

“Driver had their pants unzipped and the client feels that the driver looked dirty, sloppy and crazy.”

“The bus did not show.”

“Driver on his cell phone.”

“Vehicle ran out of gas.”

“Customer rode the paratransit vehicle for about three hours and never made it to his destination.”

“Customer was scheduled to be picked up at 12:37 and didn’t get picked up until three hours later.”

“Client states that operator asked her if she went to bed with all her boyfriends and continued to make comments on her body and made her feel very uncomfortable.”

“Operator was driving unsafe and client fell out of her seat. … Operator offered no assistance.”

“The destination was two miles away and instead was driven around for two hours due to overbooking.”

“The taxi was very overcrowded. About six people. Client states she called dispatch and was placed on hold for 30 minutes.”

“Driver stated, ‘I do not get enough money to help you get into the cab.’ Husband’s blood pressure went up to 200.”

“Driver was speeding over bumps and would not respond to her when she asked him to slow down because she has a bad back. Customer states driver was very rude and was driving very reckless while talking on the phone the whole time.”

“Operator arrived at location with pants sagging and appeared to be drunk. … Operator drove over cones in main entrance driveway and drove over speed bumps speeding.”

Doug Douglas, a DART vice president, says paratransit drivers have taken two mandatory “refresher” courses since MV Transportation won the contract with a bid of $186 million for seven years.

“Things are getting better every day,” he says. “We have not had any regression. The complaints you have are raw. They have not been validated. We have commendations regarding service as well.”

To be fair, I found this in the stack of a thousand pages: “Driver very kind. Helps customer with lift. He pulled the strap behind customer and secured her. Very timely. Customer got to church in good time. He is real nice.”

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The Watchdog: Owner of the Shutter Factory of Plano wanted in theft

William Clifton Wallace Jr., where are you?

You are magical when it comes to disappearing.

You ran the Shutter Factory for years in Plano, selling shutters, draperies and curtains. You did fine work. “A lifetime of beauty,” your business cards promised. But your business went south a couple of years ago, and it officially closed in early 2012.

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Yet there you were, continuing to behave as if the business existed. You went to people’s houses, measured windows, showed samples, wrote invoices and collected 50 percent deposits.

You collected thousands of dollars in deposits, but then you disappeared. Nobody could find you. Nothing was delivered.

When negative online reviews about your behavior showed up on consumer websites warning others to stay away, a spate of positive comments from fake customers touting your honesty and your expertise appeared.

In February, Collin County authorities issued a warrant for your arrest on theft charges, and you disappeared for good. You lost your Allen home in a foreclosure. Your phone numbers don’t work. You’re 56 years old and in hiding.

Thank you to Mary and Bobby Stark of Dallas for telling The Watchdog about you. They had hired you before in 2008, and you did good work. In June 2012, four months after your state business license was forfeited, you answered their call for another estimate. The Starks paid you $4,400 in a half-deposit. You cashed the check at a Plano convenience store. Then you pulled your disappearing act.

“If there’s anything you can do to help us, it would be so wonderful and so much appreciated,” Mary Stark told The Watchdog. “We worked so very long to save up the money for these shutters, and it just seems that something should be done about this.”

I asked my Watchdog desk associate, Marina Trahan Martinez, to research your legal status. Turns out to be quite a mystery.

Wallace, you’re a wanted man, but authorities are not allowed to say that on the record. The only notice of pending criminal theft charges against you is a brief mention in a Collin County active warrant list. A warrant was issued for your arrest on Feb. 11. The rest of the case against you is sealed. Texas law says that in certain cases, charges cannot be discussed until a suspect is in custody.

I know for sure the case against you is not the Starks’ case. They say they went to the police to complain, but no one ever followed up. So the case involves another customer or customers.

The Starks’ case is for the largest amount of lost funds I could find online. Other customers complain of losing $1,000 or less.

One complainant on the Better Business Bureau website says he lost $427. “He told us the shutters would be installed in six weeks. I have left a number of phone calls and none have been returned. Now you just get a busy signal when you call.”

On another website, a customer writes, “They took my money when they took 50 percent down. … I have been trying for over three months to get my promised shutters for my home.”

At the same time, consumer websites that had negative reviews were flooded with positive comments. In some cases, a batch would be posted on the same day, a possible sign of fakery.

“The job took a little longer than expected but they were over the top with their customer service and did it with a smile,” one writes.

“Bill was very punctual, very knowledgeable and extremely professional,” another writes.

“Bill, it has been a pleasure doing this project with you, and I wish you and your company every success in the future,” goes another.

What future?

The only Shutter Factory business in Texas that has a future, apparently, is the other Shutter Factory owned by Chuck and Sammie Downey in Kerrville. That business has nothing in common except the name.

Even Chuck says he started getting calls for you last year. “People were wanting their money,” Chuck says. “We told them, ‘We’re not him.’”

“A lot of people have been burned by him,” Bobby Stark says.

That’s why I’m taking the rare action of issuing a Watchdog Nation all points bulletin to anyone within eyeshot of this column.

William Clifton Wallace Jr., where are you?

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The Watchdog: Get ready! Corporate super PACs now allowed in all Texas elections

So Watchdog Man, what do you have for us this Friday the 13th?

Sit down.

Why?

Because when I tell you the subject, you might want to run away. It’s unlucky, a major development in what’s perhaps the root of all evil.

Go ahead.

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The Watchdog wants you to know how Texas government and politics are about to change in a fundamental way.

OK, you have my attention.

A little-noticed lawsuit has cleared the way for a historic switch. For the first time, corporations can make direct contributions to super PACs to influence state, county, local and school board elections in Texas.

You mean like that U.S. Supreme Court Citizens United decision that did the same for federal races?

Exactly. In lawyer talk, this aligns Texas with the federal ruling.

Cut the lawyer talk. What does this mean for the average voter?

In the darkest scenario, a millionaire donor from out-of-state could chuck gobs of money into a school board race and overthrow a board. Woe to a town mayor who upsets a big company. Small-town races could suddenly see a massive influx of corporate money handled through what state officials call “direct campaign expenditure only committees.”

I don’t get it.

Corporations were not allowed to donate to Texas elections through committees or any other way. Now they can pool their money with individual donors in these new political action committees. And these super PACs, although not allowed to make direct contributions to candidates, can spend unlimited amounts to campaign for one side or another. They will supposedly operate independent of the candidates.

How did this happen?

A group called Texans for Free Enterprise filed a federal lawsuit against the Texas Ethics Commission. The state lost. Dallas lawyer Chris Gober is the winning lawyer.

What does he say?

He says, “It’s very controversial. Some people certainly take the position that the more money in politics, the worse. What this particular decision represents is us requiring the state of Texas to recognize the bounds of the First Amendment that have been established by the U.S. Supreme Court.”

Corporations still cannot donate directly to candidates, Gober says. “What the law still does is prevent corporations from actively engaging with candidates and giving direct money to candidates in ways that create the danger of quid pro quo corruption.”

Do you think that’s true, Watchdog Man?

We’ll see. What we do know is that corporations will have more power to influence Texas elections than ever, and they were no shrinking violet before this. Gober says, “A lot of people believe that corporations are affected by government policies more so than individuals, that they have the right to engage in the debate to determine how the people are going to be governed.”

Are there limits to the donations?

No limits.

What does the losing party, the Texas Ethics Commission, say?

Officials are changing state election law. TEC general counsel Natalia Ashley says, “It’s hard to know how it’s going to impact races since this is the first time it will be allowed.”

Watchdog, did you talk to a political expert?

I did. Cal Jillson, the SMU political science professor, says that since individuals could already donate unlimited amounts to Texas races, this won’t have a dramatic effect. He suggests that some corporations will be hesitant to get involved in races: “Their customers are on both sides of divisive issues.”

What about Allan Saxe, over at the University of Texas at Arlington?

Saxe tells The Watchdog: “I’m for free speech. It may be unfair, but the First Amendment doesn’t talk about fairness. It talks about freedom, and that’s what the case is based on. In our society, everybody is trying to be fair and make everybody equal. … Money is not fair. But as long as people earn their money honestly and legally, I have no quarrel with it.”

What can the rest of us do, Watchdog?

My suggestion: Voters must pay attention to where political money comes from, why donors are giving and what they hope to get out of it. Contributor information and PAC registration will be available for free viewing on the Texas Ethics Commission website.

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The Watchdog: Company blames office janitor for Do Not Call lawsuit

Do you know what a Perry Mason moment is? In court proceedings, it’s when one side in a legal drama produces a piece of evidence or a confession that changes everything.

In modern talk, it’s a slam-dunk straight to the hoop, in your face, that leaves an audience gasping.

The Watchdog doesn’t witness many Perry Mason moments. Companies rarely litigate their customer lawsuits in a newspaper column. When a lawsuit is involved, a company spokesman usually says, “Because this is a pending legal matter, we cannot comment.”

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Yet Universal AdCom, an Arlington printing company, is so eager to fight back in public against what it considers phony customer complaints that it violated the do-not-comment practice.

Universal AdCom is accused in a new federal lawsuit filed by an Arkansas business owner of violating the Do Not Call list.

Company officials deny any violation. They say the complainant was a former customer and they had a right to call him.

“If he doesn’t want us to call him again, we’re certainly not going to,” James Gildenblatt, Universal AdCom president, told me. “We thought he was a happy camper.”

I’m no prosecutor, jury member or judge, but I do know how to ask questions. Both sides agreed to talk to The Watchdog and argue their case. That’s what led to the Perry Mason moment.

Do Not Call violators are hard to catch. They hide behind false phone numbers shown on Caller ID machines and often route their calls through foreign countries where U.S. rules don’t apply. When nabbed, which is rare, violators get fined thousands of dollars.

Universal AdCom isn’t known as a Do Not Call violator. The company’s problems in years past stemmed from aggressive sales practices and allegations of false billing — which the company denied. Hundreds of complaints forced an F grade from the Better Business Bureau. Three states took legal action against the company.

Universal AdCom sells ad space to businesses and prints the ads on maps, magnets, tote bags, T-shirts, cups and other items. The company was the subject of complaints and government actions because its sales staffers were accused of claiming direct affiliation with governments, chambers of commerce and schools when they had no connection.

Former staffers told me two years ago that they claimed a closeness to the activities they were selling to. They dropped names of insiders and alluded to nonexistent partnerships.

Scores of chambers, governments and schools warned their community members about Universal AdCom and the other names it did business under (Premier Map, Premier Impressions, Totes 2 Go, Hometown Productions, Fanfare Sports, Scoreboard Marketing).

One sales staffer told me the company philosophy was “you have to do what you have to do” to make a sale. Another former employee told me, “We’re instructed to tell them we have an agreement with someone in the athletic department.”

The company’s reputation on the Internet was terrible. Comments from disgruntled customers and others who received aggressive sales pitches stacked up in message boards.

Two years ago, president Jim Gildenblatt ordered a turn-around. He fired a top saleswoman, which showed he was serious about cleansing the company’s reputation.

He purchased a recording system that captured customers’ verbal consents to make purchases. If a customer complained later that they were billed for something they hadn’t ordered, the company could play back a tape proving they had made the order.

The company defended itself. “It really has changed the culture,” Gildenblatt says. The BBB rating improved. “We got it up to a C,” he says.

The lawsuit from Arkansas is a new hurdle for the company’s march back to respectability. Tim Bunting, owner of Bug Pro, an Arkansas pest control business, bought map ads from Universal AdCom two years ago. Then he decided to stop doing business with them.

Sales staffers pursued Bunting, sending him bills and calling him at least a hundred times, according to his lawsuit, filed by attorney Matthew Vandiver of Little Rock.

In my interview, Gildenblatt said that Bug Pro’s owner never told his company to stop calling him.

“I don’t have a record of anything coming in,” the AdCom president said. “It’s news to me. … I do not have a record of him asking us to take him off the call list.”

Cue the Perry Mason moment.

The lawyer for the exterminator produced a letter written last year asking Universal AdCom to leave his client alone. No more sales. No more calls. No more bills.

Lawyer Vandiver also produced a green postal return-receipt card that shows someone at Universal AdCom accepted delivery of that letter. Slam-dunk. Gasp.

When Exhibit A is presented to the company president, he looks at the green slip and explains it was signed by Larry, the company “maintenance guy.”

“He got the mail for us,” the president says. “It’s not the first one I didn’t get from him. Obviously, it never got to me. It never got into our system. … If I had gotten it, I would have handled it immediately.”

But he didn’t, and the company making a comeback to respectability blames a janitor for not delivering a crucial piece of mail.

There’s an expression: Don’t make a federal lawsuit out of it. But someone did.

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The Watchdog frets about his son’s new driver’s license and car

The Watchdog is supposed to be infallible, impervious to supervillains, shoddy corporations and disappearing refrigerator repairmen. But I have one vulnerability that leaves me with an overwhelming sense of helplessness and resignation.

It’s not battling an electric company or arguing with a cellphone company. Much worse than that. My vulnerability involves someone I cherish, now permitted under law to insert himself inside a 3,246-pound machine and hurl himself along a superhighway at speeds approaching 70 mph.

Last week, my youngest son, the 16-year-old, got his driver’s license.

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With that, my lack of control and helplessness truly begins. As The Watchdog, I’m not used to this. I know how to take care of business. Make sure things go right. Fix them when they go wrong.

Take on a powerful corporation? No problem. Stand up to formidable politicians? Child’s play. But give my youngest kid a driver’s license and a car and suddenly, that’s me — a howling watchdog with no more bite. He’s free, and I can’t be around all the time to protect, to scold, to nurture, to watchdog him anymore.

Before you think my fears are overblown, know that Austin, my beautiful son, has already set a world record of sorts involving his new car and an auto body repair shop. But I’ll get to that in a moment.

My two older children received their licenses and first cars in the pre-9/11 era. It’s different now. Getting a license has become an ordeal, apparently part of Homeland Security’s desire to keep licenses out of the hands of terrorists and scammers.

Instructions are overly complicated. There are too many forms (the DE-964, DL-92 and the ever-popular DL-90b). Supplemental documentation resembles what’s needed for a home loan.

The PTDE packet was nearly my undoing. That’s the Parent Taught Driver Education packet. Otherwise known as the PWJOCW for Parents Wanting to Jump Out of the Car Window. The inventor of Parent Taught Driver Ed also probably invented waterboarding.

Our nighttime lessons took place after I came home from work. They’d begin the same way every time. He’d pull out of the driveway and I’d say, “You forgot to turn on the headlights.”

He’d say, “It’s not the end of the world.”

“You left the garage door open.”

“Dad, it’s not the end of the world!”

Watching a teen learn to drive is probably funny if it’s someone else’s kid. But when it’s your own, it IS the end of the world.

Hanging on fearfully to the passenger side door during sharp turns, I began to understand that a new driver’s license serves as the main doorway into adulthood. This is where a watchdogging parent must learn to give it up.

His mother and I have done what we can. We purchased a safe, dependable used car for him and signed him up for proper insurance. We bought him an associate membership in AAA, taught him how to use his new debit card at a gas pump, lectured him about tow-away zones, red-light cameras, suburban speed traps and the most important challenge: how to remember where you put your car keys.

At the end of our lessons, once we were back safely in the garage, I always tried to end on a positive note.

“Good job, son. You forgot to turn off the lights.”

“It’s not the end of the world.”

My son named his car after a favorite character in the movie The Hangover. Previously, I mentioned that Austin and Mr. Chow together set a world record of sorts — the fastest time for a new driver to send his car to the body shop for repairs. In my son’s case, before he even drove his car, he put a hurt on Mr. Chow.

Poor Mr. Chow had barely entered his new home before my beautiful son closed the garage door on his back bumper. A $500 repair — before the car left the house.

Yes, as a parent watchdog for my children, I have this vulnerability that leaves me helpless. But I’m looking for a sign that he and Mr. Chow will make a good team.

I found one. On New Year’s Day, my son hosted five friends for a sleepover. At 3 a.m., when the boys were still up talking. Austin left to go to his job. Every day before sunrise, he cleans a neighborhood restaurant before it opens for business.

That’s real responsibility for any 16-year-old. I’m proud of him for that. I know in my heart that it’s time to let the bird fly.
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