AUSTIN - Texas Attorney General John Cornyn today announced a settlement with a telemarketing firm to prevent the sale of individuals' health information. Cornyn, along with Attorneys General from five other states, alleged that Action Direct Marketing and its owner, Robert D. Hodges, conducted deceitful surveys to compile lists of likely targets for health care products.
"This business was deceptively compiling confidential information from individuals," said Cornyn. "That is wrong. Individual health information should be protected as confidential, and we will not allow businesses to trick consumers into giving that information away."
Telemarketers from Action Direct Marketing told consumers that they were conducting a national health survey when, in truth, they were creating a list of people with hearing loss, heart conditions, blood pressure problems and other physical pains. Action Direct Marketing then sold these lists of consumers to health care providers. On behalf of the providers, Action Direct Marketing mailed these lists advertisements for the providers and scheduled the consumers for appointments. The providers, which included hearing aid dispensers, audiologists, and chiropractors, were unaware of how Action Direct Marketing compiled their list.
Under the terms of the settlement, the company is prohibited from misrepresenting the purpose of consumer health surveys. Action Direct Marketing is required to disclose that all information collected in the survey may be shared with health care providers for marketing purposes. Action Direct Marketing and Robert D. Hodges will also pay $25,000.00 in civil penalties as part of the settlement.
The Texas settlement was filed today in District Court in Dallas County. The other participating Attorneys General represent Vermont, Minnesota, Illinois, California and Wisconsin. This case was handled by Assistant Attorney General Joyce Wein Iliya of the Dallas Office of the Consumer Protection Division.