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State ex rel. Miller v. Vertrue, Inc.

Supreme Court of Iowa

July 5, 2013

STATE OF IOWA ex rel. THOMAS J. MILLER, Attorney General for Iowa, Appellee,
VERTRUE, INCORPORATED f/k/a MEMBERWORKS, INC., a Delaware Corporation; ADAPTIVE MARKETING, LLC, a Delaware Limited Liability Company; IDAPTIVE MARKETING, LLC, a Delaware Limited Liability Company, Appellants.

Appeal from the Iowa District Court for Polk County, Robert A. Hutchison, Judge.

Seller of buying club memberships appeals the district court's rulings that its solicitation and business practices violated the buying club membership law and the consumer fraud act. The State cross-appeals.

Mark McCormick and Margaret C. Callahan of Belin McCormick, P.C., Des Moines, and Jeffrey R. Babbin and Kim E. Rinehart of Wiggin and Dana LLP, New Haven, Connecticut, for appellants.

Thomas J. Miller, Attorney General, Jeffrey S. Thompson, Deputy Attorney General, and Steven M. St. Clair and Julia S. Kim, Assistant Attorneys General, for appellee.

CADY, Chief Justice.

In this appeal and cross-appeal, we must consider numerous issues in an action brought by the Attorney General of Iowa against Vertrue Incorporated alleging violations of the Buying Club Membership Law (BCL), pursuant to Iowa Code chapter 552A (2005), and the Iowa Consumer Fraud Act (CFA), pursuant to Iowa Code section 714.16. The State also sought civil penalties for consumer frauds committed against the elderly pursuant to Iowa Code section 714.16A. The district court found: (1) a number of Vertrue's marketing and sales practices violated the BCL and the CFA, (2) application of the BCL to Vertrue's solicitation practices did not violate the dormant Commerce Clause, and (3) Vertrue did not commit consumer frauds against the elderly in violation of section 714.16A. The court entered judgment awarding $25, 250, 736.19 in consumer reimbursement for fees paid in connection with memberships sold in violation of the BCL or CFA, civil penalties in the amount of $2, 820, 000, and $725, 240.05 in attorney fees and costs. On our review, we affirm the judgment of the district court in part, reverse in part, and modify the judgment.

I. Factual and Procedural Background.

Vertrue sells memberships in buying programs that give members the option to purchase various goods and services at discounted rates. Since 1989, Vertrue has enrolled 863, 970 Iowans in membership programs. To entice membership into the programs, Vertrue frequently offered gift cards and other "cash back" rewards. Further, Vertrue consistently offered consumers free trial memberships with a negative option—meaning consumers would be charged the full price of the membership if they failed to call and cancel within the designated trial period. Normally, once individuals were enrolled in one of Vertrue's membership programs, their credit cards or bank accounts were charged on a monthly basis until they contacted Vertrue and canceled the membership.

In 1999, the Consumer Protection Division (CPD) of the Iowa Attorney General's Office began receiving a high volume of complaints from Iowans regarding Vertrue's marketing and business practices. In response to these complaints, the CPD commenced an investigation in December 2004 to assess the legality of Vertrue's business practices. As part of the investigation, the CPD sent approximately 400 written surveys to Iowans who had been enrolled in one of four membership programs offered by Vertrue since April 1, 2003. Of the eighty-eight survey respondents, 67% indicated they were either unaware of their membership or did not authorize the membership charges, or both. None of the survey respondents indicated consumer satisfaction.

Based in part on the results of the CPD investigation, on May 12, 2006, the Attorney General initiated this action against Vertrue alleging violations of the BCL and the CFA. The State sought consumer restitution, injunctive relief, and civil penalties under both the BCL and the CFA, and additional civil penalties for consumer frauds committed against the elderly pursuant to Iowa Code section 714.16A.

The State subsequently filed an amended petition to add Vertrue affiliates, Adaptive Marketing, LLC and Idaptive Marketing, LLC, as well as West Telemarketing Corporation and West Corporation, as defendants. The West defendants later settled and were dismissed from the litigation. The remaining defendants, Vertrue, Adaptive, and Idaptive (collectively Vertrue)[1] filed an answer to the State's amended petition denying liability under the BCL and CFA. Vertrue asserted counterclaims requesting declaratory orders establishing the legality of its sales practices under the BCL and CFA. Additionally, Vertrue sought a declaratory judgment establishing that application of the BCL to its mail, telephone, and Internet solicitations would violate the dormant Commerce Clause of the United States Constitution.

The district court bifurcated trial. The first phase addressed the issue of liability. The district court reaffirmed its previous summary judgment rulings and held the BCL was applicable to Vertrue's mail, telephone, and Internet solicitations and that these solicitations violated the BCL. The district court further held that application of the BCL to Vertrue's solicitations did not violate the dormant Commerce Clause. Additionally, the district court concluded several of Vertrue's marketing and business practices constituted unfair practices and deceptive acts under the CFA. However, the court found the BCL did not apply to Vertrue's financial, privacy, or health membership programs, and the State was not entitled to additional civil penalties for consumer frauds committed against the elderly.

During the remedies phase of the trial, the district court interpreted Iowa Code section 714.16(7) to require the State to prove reliance, damages, intent to deceive, and knowledge of falsity in order to obtain a consumer reimbursement award for both the BCL and CFA violations. The court found the State proved 90% of Iowa consumers would have canceled Vertrue's programs had they received BCL-compliant disclosures and accordingly ordered consumer reimbursement of 90% of Vertrue's net revenues from non-BCL-compliant solicitations. This figure amounted to $22, 715, 073.65. An additional $2, 535, 662.54 was awarded for CFA violations, making the total reimbursement award $25, 250, 736.19. The court also awarded a total of $2, 820, 000 in civil penalties for the BCL and CFA violations and $725, 240.05 for costs and attorney fees. Finally, the court entered various injunctive orders requiring Vertrue to comply with the provisions of the BCL and CFA.

Vertrue appealed. It claimed the district court erred in finding the BCL applied to its mail, telephone, and Internet sales; the application of the BCL to Vertrue's mail, telephone, and Internet sales did not violate the dormant Commerce Clause; there was sufficient evidentiary support for the BCL reimbursement award and such an award was equitable; there was sufficient evidence of the CFA violations regarding Vertrue's telemarketing solicitations and sufficient evidence for the respective reimbursement award; and there was sufficient evidence to support a CFA reimbursement award for the practice of requiring dual cancellation requests for memberships bundled into a single Internet transaction.

The State cross-appealed. It argued the district court erred in finding the record did not support an award of additional civil penalties for consumer frauds committed against the elderly; the BCL did not apply to Vertrue's financial, privacy, and health programs; a BCL reimbursement award requires proof of reliance, damages, intent to deceive, and knowledge of falsity; a reimbursement reward for a CFA claim of concealment, suppression, or omission of a material fact requires proof of reliance, damages, intent to deceive, and knowledge of falsity; and there was insufficient evidence of reliance, damages, intent to deceive, and knowledge of falsity to support a finding of a CFA violation for Vertrue's "breakage" practices.[2]

II. Application of the Buying Club Membership Law.

A. Scope of Review.

Our review of this equity ruling is de novo; however, we review the district court's interpretation of chapter 552A for correction of errors at law. See Iowa Film Prod. Servs. v. Iowa Dep't of Econ. Dev., 818 N.W.2d 207, 217 (Iowa 2012). We also review de novo the district court's ruling on questions of constitutional law. Homan v. Branstad, 812 N.W.2d 623, 628–29 (Iowa 2012). In reviewing a challenge under the dormant Commerce Clause of the United States Constitution, "[o]ur function is to determine, to the best of our ability, how the United States Supreme Court would decide this case under its case law and established dormant Commerce Clause doctrine." KFC Corp. v. Iowa Dep't of Revenue, 792 N.W.2d 308, 322 (Iowa 2010). Thus, we do not "engage in independent constitutional adjudication" or "seek to improve or clarify Supreme Court doctrine." Id.

B. Preservation of Error.

The State contends Vertrue's proposed interpretation of section 552A.3, as well as its dormant Commerce Clause claim, were not properly preserved for appeal. Our error preservation rules provide that error is preserved for appellate review when a party raises an issue and the district court rules on it. Meier v. Senecaut, 641 N.W.2d 532, 537 (Iowa 2002). Vertrue clearly presented to the district court the issue of whether section 552A.3 applied to solicitations that were not made in person. The record demonstrates the parties debated the "irrespective of the place or manner of sale" clause of section 552A.3 at length and the district court rejected Vertrue's interpretation. Moreover, the State acknowledges that "the court ruled the BCL did not violate the Commerce Clause [and] Vertrue filed a motion to reconsider." Accordingly, we conclude Vertrue has properly preserved error on both of these arguments.

C. Statutory Framework.

In 1993, our legislature enacted the BCL to protect consumers by regulating the sale of buying club memberships. See 1993 Iowa Acts ch. 60, §§ 1–5 (codified at Iowa Code §§ 552A.1–.5 (Supp. 1993)).[3] The Act essentially regulates membership sales in two ways. It imposes duties and restrictions on merchants of buying club memberships and establishes public and private remedies for violating its terms. See Iowa Code §§ 552A.3–.5 (2005). The section at issue incorporates the disclosure and notice requirements of the Iowa Door-to-Door Sales Act (DDSA). See id. § 552A.3. It provides:

The requirements of sections 555A.1 through 555A.5, relating to door-to-door sales, shall apply to sales of buying club memberships, irrespective of the place or manner of sale or the purpose for which they are purchased. In addition to the requirements of chapter 555A, a contract shall not be enforceable against a person acquiring a membership in a buying club unless the contract is in writing and signed by the purchaser.

Id.; see also id. §§ 555A.1–.6 (regulating door-to-door sales).

The DDSA imposes numerous requirements on door-to-door sales. Notably, the DDSA requires sellers to provide buyers with a copy of the completed written contract at the time of execution and further requires that the contract include a statement written in large boldface print advising the buyer of the right to cancel the transaction within three business days. Id. § 555A.2. A more detailed notice explaining the right to cancel must be attached to the contract. Id. § 555A.3. The DDSA also imposes an obligation to supplement the written right to cancel with an oral statement of the right at the time the contract is signed. Id. § 555A.4. The legislature enacted the DDSA in 1973 because home solicitation sales can often involve unfair, high pressure tactics. See 1973 Iowa Acts ch. 291, §§ 1–6 (codified at Iowa Code §§ 713B.1–.6 (1975) (current version at Iowa Code §§ 555A.1–.6)).

D. Statutory Interpretation.

Vertrue's argument rests on the premise that section 552A.3's notice and disclosure requirements can only be accomplished by in-person conduct. Vertrue asserts that many of the DDSA requirements as incorporated by the BCL would be impracticable or impossible to perform by merchants who sell buying club memberships by mail, telephone, or the Internet. For example, Vertrue points out that a merchant who uses the mail or Internet to make a sale cannot orally inform the buyer of the right to cancel. Likewise, Vertrue points out that a merchant who uses the telephone to negotiate a sale of a buying club membership cannot hand the seller a copy of the contract. Consequently, Vertrue asserts the legislature only intended section 552A.3 to apply to in-person sales of buying club memberships.

The State, by contrast, asserts that section 552A.3 operates to make the incorporated DDSA notice and disclosure requirements applicable to all buying club membership sales, regardless of the place or means employed in the transaction. The State adds that section 552A.3 can be satisfied by supplementing direct mail and Internet transactions with coordinated telephone contact and the transfer of documents by mail or facsimile. It further points out that Internet transactions can be supplemented with telephone messages and electronic signatures.

Our obligation is to interpret the statute based on the language used by our legislature. See Auen v. Alcoholic Beverages Div., 679 N.W.2d 586, 590 (Iowa 2004) ("We determine legislative intent from the words chosen by the legislature, not what it should or might have said."). Here, the statute provides specific directions. It provides that the requirements for door-to-door sales "apply to sales of buying club memberships, irrespective of the place or manner of sale." Iowa Code § 552A.3 (emphasis added). Section 552A.3 of the BCL is not the first occasion our legislature has had to use the phrase "irrespective of the place or manner of sale." It used this same phrase in the definitions section of the DDSA to enlarge the scope of the DDSA requirements in the sale of funeral services and merchandise, as well as the sale of social referral services. Id. § 555A.1(3)(b). Under this section, the requirements for door-to-door sales apply to the sale of funeral services and merchandise and social referral services "irrespective of the place or manner of sale." Id. Thus, sales in these two areas must follow the DDSA requirements even though the DDSA technique is not used. Yet, we have not had an occasion to interpret the phrase.

It is clear our legislature has defined a door-to-door sale in the context of "place" and "manner." The "manner" must involve a personal solicitation of a sale by the seller or the seller's representative, including sales in response to an invitation by a buyer. Id. § 555A.1(3)(a). The "place" is limited to "a place other than the place of business of the seller." Id. Thus, when the legislature declares DDSA requirements apply to buying club membership sales "irrespective of the place or manner, " it is declaring the requirements apply without regard to the "place" or "manner" that define door-to-door sales. In other words, the requirements of the DDSA apply to sales at the "place" of the business of the seller and to sales transacted in a "manner" that is not restricted to in-person solicitation.

Vertrue accurately described some of the difficulties it will encounter in attempting to transact its buying club membership sales by mail, telephone, and the Internet when it is required to follow consumer protection practices developed for person-to-person transactions. Yet, we must focus on the clear language of the statute to direct the outcome, not the difficulty of compliance under a particular business model. Thus, we conclude the trial court properly interpreted section 552A.3 to apply the requirements of the DDSA to the selling of all buying club memberships.

E. The Dormant Commerce Clause.

Vertrue contends that even if the BCL applies to its mail, telephone, and Internet transactions, it does so in violation of the Commerce Clause of the United States Constitution. Since compliance with the BCL is "unworkable" unless the buying club membership transaction occurs in person, Vertrue maintains the BCL discriminates against out-of-state sellers— unconstitutionally favoring sellers who establish a physical presence in Iowa, thereby investing in Iowa employees and facilities.

The United States Constitution grants Congress the power "[t]o regulate Commerce . . . among the several States." U.S. Const. art. I, § 8, cl. 3. The Commerce Clause "has long been seen as a limitation on state regulatory powers, as well as an affirmative grant of congressional authority." Fulton Corp. v. Faulkner, 516 U.S. 325, 330, 116 S.Ct. 848, 853, 133 L.Ed.2d 796, 804 (1996). The limitation on state regulatory powers—termed the "dormant Commerce Clause"—" 'prohibits economic protectionism—that is, "regulatory measures designed to benefit in-state economic interests by burdening out-of-state competitors." ' " Id. (quoting Associated Indus. of Mo. v. Lohman, 511 U.S. 641, 647, 114 S.Ct. 1815, 1820, 128 L.Ed.2d 639, 646 (1994)). Thus, "the [Commerce] Clause is both a 'prolific sourc[e] of national power and an equally prolific source of conflict with legislation of the state[s].' " Kassel v. Consol. Freightways Corp. of Del., 450 U.S. 662, 669, 101 S.Ct. 1309, 1315, 67 L.Ed.2d 580, 586 (1981) (quoting H. P. Hood & Sons, Inc. v. Du Mond, 336 U.S. 525, 534, 69 S.Ct. 657, 663, 93 L.Ed. 865, 872 (1949)).

Modern dormant Commerce Clause jurisprudence is principally concerned with effectuating

the Framers' purpose to "preven[t] a State from retreating into economic isolation or jeopardizing the welfare of the Nation as a whole, as it would do if it were free to place burdens on the flow of commerce across its borders that commerce wholly within those borders would not bear."

Fulton, 516 U.S. at 330–31, 116 S.Ct. at 853, 133 L.Ed.2d at 805 (quoting Okla. Tax Comm'n v. Jefferson Lines, Inc., 514 U.S. 175, 180, 115 S.Ct. 1331, 1335–36, 131 L.Ed.2d 261, 268 (1995)). The United States Supreme Court has adopted a two-tiered approach to analyzing state economic interest regulation pursuant to the dormant Commerce Clause:

When a state statute directly regulates or discriminates against interstate commerce, or when its effect is to favor instate economic interests over out-of-state interests, we have generally struck down the statute without further inquiry. When, however, a statute has only indirect effects on interstate commerce and regulates evenhandedly, we have examined whether the State's interest is legitimate and whether the burden on interstate commerce clearly exceeds the local benefits.

Brown-Forman Distillers Corp. v. N.Y. State Liquor Auth., 476 U.S. 573, 579, 106 S.Ct. 2080, 2084, 90 L.Ed.2d 552, 559–60 (1986) (citations omitted)). The party challenging the constitutionality of the statute bears the burden of demonstrating the statute discriminates either on its face or in practical effect. Hughes v. Oklahoma, 441 U.S. 322, 336, 99 S.Ct. 1727, 1736, 60 L.Ed.2d 250, 262 (1979).

If the challenger demonstrates that the restriction on interstate commerce is discriminatory, a "virtually per se rule of invalidity" applies—even if the restriction is related to a legitimate local purpose. Chem. Waste Mgmt., Inc. v. Hunt, 504 U.S. 334, 344 & n.6, 112 S.Ct. 2009, 2015 & n.6, 119 L.Ed.2d 121, 133 & n.6 (1992) (citation and internal quotation marks omitted). In order to validate such a statute, the government carries the heavy burden of proving the regulation "advances a legitimate local purpose that cannot be adequately served by reasonable nondiscriminatory alternatives." New Energy Co. of Ind. v. Limbach, 486 U.S. 269, 278, 108 S.Ct. 1803, 1810, 100 L.Ed.2d 302, 311 (1988).

On the other hand, if the law "regulates even-handedly to effectuate a legitimate local public interest, and its effects on interstate commerce are only incidental, it will be upheld unless the burden imposed on such commerce is clearly excessive in relation to the putative local benefits." Pike v. Bruce Church, Inc., 397 U.S. 137, 142, 90 S.Ct. 844, 847, 25 L.Ed.2d 174, 178 (1970). In this context, the challenger carries the burden of proving excessiveness. Pharm. Care Mgmt. Ass'n v. Rowe, 429 F.3d 294, 313 (1st Cir. 2005). In evaluating a regulation's putative local benefits, the court proceeds with deference to legislative judgments. See CTS Corp. v. Dynamics Corp. of Am., 481 U.S. 69, 92, 107 S.Ct. 1637, 1651 95 L.Ed.2d 67, 87 (1987). However, a law "designed for [a] salutary purpose nevertheless may further the purpose so marginally, and interfere with commerce so substantially, as to be invalid under the Commerce Clause." Kassel, 450 U.S. at 670, 101 S.Ct. at 1316, 67 L.Ed.2d at 587.

With these principles in mind, we turn to the task of evaluating the constitutionality of section 552A.3. Initially, we note section 552A.3 is not facially discriminatory—it does not reference interstate commerce or interstate interaction. Instead, it regulates in an evenhanded manner by applying the notice and disclosure requirements to any seller of "memberships" to a "buying club, " as those terms are defined in section 552A.1, "without regard to whether . . . the sellers are from outside the State." Minnesota v. Clover Leaf Creamery Co., 449 U.S. 456, 471–72, 101 S.Ct. 715, 728, 66 L.Ed.2d 659, 674 (1981); see also Iowa Code §§ 552A.1, .3. Moreover, section 552A.1 does not set forth a definition limited to interstate sellers of buying club memberships, nor does it exclude local sellers. See Iowa Code §§ 552A.1–.2.

We acknowledge compliance with the requirements of section 552A.3 for contemporaneous written and oral obligations at the time of the transaction may be difficult for out-of-state sellers with no in-state presence. Yet, the restrictions at issue place the same burden on all sellers using the telephone, mail, or Internet to transact a sale in Iowa.[4]See SPGGC, LLC v. Blumenthal, 505 F.3d 183, 194 n.3 (2d Cir. 2007). But see Dean Milk Co. v. City of Madison, 340 U.S. 349, 354–55, 71 S.Ct. 295, 298–99, 95 L.Ed. 329, 333–34 (1951) (holding a Madison, Wisconsin ordinance was unconstitutional because it had the practical effect of excluding "from distribution in Madison wholesome milk produced and pasteurized in Illinois"). "The fact that the burden of a state regulation falls on some interstate companies does not, by itself, establish a claim of discrimination against interstate commerce." Exxon Corp. v. Governor of Md., 437 U.S. 117, 126, 98 S.Ct. 2207, 2214, 57 L.Ed.2d 91, 100 (1978).

Section 552A.3 does not afford Iowa sellers a competitive advantage or cause out-of-state sellers to "surrender whatever competitive advantages they may possess." Brown-Forman, 476 U.S. at 580, 106 S.Ct. at 2085, 90 L.Ed.2d at 560. Therefore, we cannot conclude that section 552A.3 has the practical effect of discriminating against out-of-state economic interests.

As a result, the dormant Commerce Clause claim asserted by Vertrue devolves into a question of whether the indirect, incidental burdens imposed on interstate commerce by section 552A.3 are "clearly excessive in relation to the putative local benefits." Pike, 397 U.S. at 142, 90 S.Ct. at 847, 25 L.Ed.2d at 178. The protection of consumers and the curtailment of unfair business practices have long been recognized as significant interests in determining whether statutory regulations violate the Commerce Clause. See CTS, 481 U.S. at 93, 107 S.Ct. at 1652–53, 95 L.Ed.2d at 88 (finding no violation of the dormant Commerce Clause and noting Indiana's statute regulating corporate takeovers served the "substantial interest in preventing the corporate form from becoming a shield for unfair business dealing"); Int'l Dairy Foods Ass'n v. Boggs, 622 F.3d 628, 649 (6th Cir. 2010) (holding that burdens placed on interstate commerce by Ohio milk labeling regulation did not outweigh the consumer protection benefits); Allstate Ins. Co. v. Abbott, 495 F.3d 151, 161–62 (5th Cir. 2007) (holding that Texas statute restricting ability of auto insurers to operate body shops did not violate dormant Commerce Clause because, despite "stray protectionist remarks, " the legislative record demonstrated legislation was enacted to protect consumers from predatory insurance practices); Alliance of Auto. Mfrs. v. Gwadosky, 430 F.3d 30, 38–40 (1st Cir. 2005) (holding that burden on interstate commerce from Maine statute prohibiting automobile manufacturers from recovering warranty repair costs for which manufacturers were required to reimburse automobile dealers did not outweigh the state's interest in protecting residents from "frauds, impositions and other abuses" (citation and internal quotation marks omitted)). Furthermore, "because consumer protection is a field traditionally subject to state regulation, '[w]e should be particularly hesitant to interfere with the [State's] efforts under the guise of the Commerce Clause.' " SPGGC, 505 F.3d at 194 (quoting United Haulers Ass'n v. Oneida-Herkimer Solid Waste Mgmt. Auth., 550 U.S. 330, 344, 127 S.Ct. 1786, 1796, 167 L.Ed.2d 655, 668 (2007)).

Notwithstanding, Vertrue argues the burdens are clearly excessive because the record does not contain any actual evidence of consumer protection benefits. However, "under Pike, it is the putative local benefits that matter. It matters not whether these benefits actually come into being at the end of the day." Pharm. Care, 429 F.3d at 313. Furthermore, Vertrue has not identified any substantial impediments on interstate commerce that outweigh the consumer protection benefits. We acknowledge the minimal burden section 552A.3 imposes on the interstate sale of buying club memberships in the form of compliance costs. Nevertheless, even a burdensome regulation does not necessarily violate the dormant Commerce Clause because it affects the profits of individual sellers. "[T]he Clause protects the interstate market, not particular interstate firms, from prohibitive or burdensome regulations." Exxon, 437 U.S. at 127–28, 98 S.Ct. at 2215, 57 L.Ed.2d at 101. Under a contrary interpretation "almost every state consumer protection law would be considered 'protectionist' in a sense prohibited by the Constitution." SPGGC, 505 F.3d at 194–95 (holding that Connecticut Gift Card Law prohibiting in-state sales of gift cards with inactivity fees and expiration dates did not regulate out-of-state commerce in violation of dormant Commerce Clause, even though out-of-state sellers necessarily incurred compliance costs).

Based on the preceding, we affirm the district court's conclusion that section 552A.3 does not violate the dormant Commerce Clause.

F. Applicability of the BCL to Vertrue's Financial, Privacy, and Health Membership Programs.

The State cross-appealed the district court's ruling regarding the applicability of the BCL to Vertrue's sales of financial, privacy, and health membership programs. In its posttrial brief, the State argued any membership that offers consumers the option to purchase one or more goods or services at a discount (discount features) should be subject to the BCL. The district court rejected this argument in regard to Vertrue's financial and privacy programs, reasoning that such an interpretation would reach too broadly encompassing entities that "cannot reasonably be considered buying clubs." While most of Vertrue's financial and privacy programs offered discounts, the court considered these to be ancillary benefits and concluded the BCL applies only to membership programs in which the primary benefit is the option to purchase discounted goods or services.[5]The district court also concluded the BCL did not apply to Vertrue's health programs, reasoning ...

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