FOR IMMEDIATE RELEASE:
December 19, 2002

FOR FURTHER INFORMATION CONTACT:
Genene Morris (973)504-6327

NEWARK - Electric Mobility, a seller of motorized wheelchairs and electric scooters, has entered into an agreement with the State to implement certain marketing and business practices designed to ensure compliance with New Jersey's consumer protection laws and to follow a complaint resolution process in an attempt to resolve all existing and future consumer complaints, Attorney General David Samson and Consumer Affairs Director Reni Erdos announced today.

Without admitting any wrongdoing, Electric Mobility has agreed to establish an escrow account of $30,000 to be used toward consumer restitution. The company will also pay the State $195,000 to cover its attorneys fees, investigative costs and future consumer initiatives.

The resolution, called an Assurance of Voluntary Compliance, follows a State investigation to determine whether the company was operating in compliance with the State's Consumer Fraud Act.

"We are satisfied that the agreement we're announcing today puts into place significant guidelines and procedures that Electric Mobility will use to better serve its customers," Governor James E. McGreevey said.

"We are pleased we were able to amicably resolve our concerns and negotiate an agreement that we believe stands to benefit consumers who do business with Electric Mobility,"Attorney General Samson said.

"Under the terms of the agreement, Electric Mobility will work to ensure that New Jersey laws are being obeyed and that during sales presentations company representatives are making clear and conspicuous disclosures to consumers," Erdos said. "This ensures that consumers are able to make decisions based on complete and accurate information."

For example, the agreement requires Electric Mobility to train its sales representatives to clearly and conspicuously disclose the requirements for Medicare reimbursement as well as the amounts and/or percentages of reimbursement available under Medicare for qualified applicants on the Medicare fees.

The company and sales representatives will also clearly and conspicuously disclose that a potential purchaser is unlikely to meet Medicare requirements, if it is reasonably clear that such is, in fact, the case. The company must also refrain from indicating or stating to consumers that Medicare will cover the cost of the wheelchair, unless there is a substantial likelihood that it will. It must also train all of its sales and marketing agents in the requirements for Medicare reimbursement.

The agreement also requires Electric Mobility and its sales representatives to clearly and conspicuously disclose the requirements for transporting the motorized wheelchair in the consumer's motor vehicle, including the need to disassemble or fold the motorized wheelchair to fit in the trunk of the automobile or the need of a carrying rack, ramp, and/or lift and the limitations of such equipment, as applicable.

Electric Mobility will also disclose that a ramp or alternative accessory device may be required to utilize the motorized wheelchair outside of the consumer's home, if such is in fact the case. It will also disclose prior to the sale if it will not install the ramp or alternative accessory device purchased from Electric Mobility.

Electric Mobility will also:

• refrain from representing or implying that a particular motorized wheelchair is appropriate for a particular consumer and/or that consumer's residence unless the sales person has received appropriate training to evaluate consumer needs and reasonably believes that this representation is true for that specific consumer. The company must train all of its sales and marketing agents and employees in the proper evaluation of a consumer's needs with respect to the motorized wheelchair being recommended for the individual consumer.
  
  
• refrain from completing the processing and/or delivery of an order for a motorized wheelchair where the consumer is seeking Medicare reimbursement unless and until the consumer has either a bonafide prescription or a bonafide Certificate of Medical Necessity from a physician for the motorized wheelchair except where the consumer waives in writing his or her right to file a Medicare claim. The significance of the waiver must be clearly and conspicuously disclosed.
  
  
• not to continue with a sales presentation after a request to cease the presentation and/or to leave the premises.
  
  
• deliver its products in accordance with the time frame promised by its sales representatives unless Electric Mobility notifies the consumer on or before the promised delivery date and provides a new delivery date that is not more than three weeks after the original delivery date promised. To the extent the new delivery date is more than three weeks after the original delivery date promised, Electric Mobility will give the consumer the opportunity to cancel the order.
  
  
• clearly disclose that merchandise is used or refurbished;
  
  
• respond to consumers' telephone and/or electronic messages left for returns or refunds within two business days of such message.

In addition, within 15 days of the agreement, Consumer Affairs will forward to Electric Mobility a list identifying all currently outstanding consumer complaints and a copy of each complaint. Within 60 days of receiving the complaint list, Electric Mobility will provide written proof to the Division as to each consumer who has been satisfied.

If any complaint identified in the list has not been resolved within 60 days of Electric Mobility receiving the list, the company will send a written response to each complaining consumer with a copy to Consumer Affairs. If the written response disputes the consumer's complaint or the relief sought by the consumer, Electric Mobility will provide copies of all documents related to the company's dispute. If it does not dispute the consumer's complaint or the relief sought, the company's response will include the sufficient documents necessary or appropriate to satisfy the consumer's complaint, including a payment or credit.

If Consumer Affairs has not received notice from Electric Mobility that a forwarded complaint has been settled on or before the 60th day after the list was transmitted to the company, the complaint will be forwarded to Consumer Affairs' Alternative Dispute Resolution Unit ("ADR") for binding arbitration.

Also, for a one-year period, Consumer Affairs will forward to Electric Mobility any new consumer complaint within 30 days of receiving the complaint. Electric Mobility, in turn, will send a written response to each complaint consumer, with a copy to Consumer Affairs. If the company's written response disputes the consumer's complaint or the relief sought by the consumer, the response will include copies of all documents related to the Electric Mobility's dispute of the complaint. If Electric Mobility's written response does not dispute the consumer's complaint or relief sought by the consumer, the company's response to the consumer will include all documents necessary or appropriate to satisfy the consumer's required relief if, including payment or credit.

If Consumer Affairs has not received notice from Electric Mobility that a forwarded complaint has been settled within 60 days after it was transmitted to the company, the complaint will be forwarded to ADR for binding arbitration.

Deputy Attorney General Carol G. Jacobson of the Division of Law handled this matter for the State.