Texas Attorney General Dan Morales is heading an investigation by more than 20 attorneys general.
Four years ago, an examination of Publishers Clearing House's direct mail pieces produced a consent agreement with a number of state attorneys general, led by New York, on what could and couldn't be done in sweepstakes.
N.Y. INVOLVED NOW
New York confirmed it is part of the new multistate investigation, though it would only confirm it was examining American Family's materials.
In New York, a law passed last year requires that the odds of winning "must be conspicuously disclosed in the same type face, size and boldness and adjacent to the most prominent listing of the prizes on the front of the first page of the offer."
The state law also bars statements that someone is "a winner" or his name "has been selected" when no prize has been won. The law carries a fine of $1,000 per incident, which could be $1,000 per letter received by New York residents.
American Family and, in several cases, spokesmen Dick Clark and Ed McMahon, were originally sued in Florida by several people and a class action suit was filed in Maryland; another suit since has been filed in Alabama. A second suit was filed last week in Alabama, along with one in New Jersey and another in Washington, D.C.
Early last week, Florida Attorney General Bob Butterworth filed his own lawsuit accusing American Family of misleading the public, citing the highly publicized case of an 88-year-man who flew from California to Tampa thinking he had won $11 million.
TWO MAILINGS PULLED
American Family has pulled two mailings, one a "letter of instruction" and another a "it's down to a two-person race" letter, but last week denied that its mailings are misleading.
American Family, partly owned by Time Warner, issued a statement saying its mailings "are not deceptive and are not written to be. The mailers are not designed to entice entrants to travel to Tampa to deliver entries. Nor are they designed to defraud. They are designed to bring fun, excitement and a legitimate chance to win millions to mailboxes across America."
Publishers Clearing House said its mailings are "in full compliance with disclosure requirements of state and federal law."