Video Computer Store Sued

Chain Files for Bankrupycy

March 26, 2001

Video Computer Store abruptly filed for bankruptcy after Pennsylvania Attorney General Mike Fisher sued the Bucks County, PA, company for allegedly selling thousands of computer systems nationwide while failing to deliver some or all of the products ordered.

The official company name is Computer Personalities Systems, Inc. It filed for bankruptcy under Chapter 11 on March 23, 2001 in Philadelphia, PA and has been assigned Bankruptcy No. 01-14231-DWS. Claims should be filed with the U.S. Bankruptcy Court at 900 Market Street, 4th Floor, Philadelphia, PA 19107.

The filing means that consumers who have ordered computers and not yet received them, or those wishing to return computers, must file claims with the court. It is not longer possible for consumers to return unwanted or defective merchandise without filing with the court.

In the Attorney General's action, the defendants are also accused of failing to honor their advertised warranty, guarantee, cancellation, refund and rebate claims. The suit seeks full restitution for consumers, civil penalties and a permanent ban from engaging in fraudulent and deceptive business practices. Approximately 140 Pennsylvania consumers filed complaints with Fisher's Bureau of Consumer Protection.

"This company's alleged pattern of outright fraud and deception is one of the worst that my office has handled," Fisher said. "Consumers paid for computer systems that they did not receive or received piecemeal months after their initial order. We contend that the promises this outfit made were not kept, and when consumers canceled their orders they were denied refunds."

Fisher said the suit was filed against Computer Personalities Systems Inc., 4970 Durham Road, Gardenville, Bucks County, doing business as Video Computer Store, 6310 Easton Road, Pipersville, Bucks County. Also named as a defendant was Computer Personalities Systems President George Capell. The defendants are accused of violating Pennsylvania's Consumer Protection Law, Fictitious Names Act, the Federal Trade Commission Mail Order Rule and Federal Warranty Act rules.

According to investigators, the defendants in 1999 and 2000 advertised their computer systems on the Internet and through nationally broadcast "infomercials." The ads offered the sale of computer packages, which included the computer unit, monitor, mouse, printer, scanner and web or video camera.

Many consumers did not receive products within the time period required under federal law, nor did they receive the required delay notice that informs buyers that they may cancel their orders and obtain a refund. Consumers who did receive delay notices said they were not provided a toll-free number to cancel their orders as required by federal law. In many cases, consumers who canceled their orders were denied refunds.

"We allege that the defendants continued to sell computer systems even after it became clear that the defendants were unable or unwilling to fulfill orders," Fisher said.

According to the lawsuit, the defendants are also accused of:

• Starting the 30-day return policy before the entire order was delivered.
• Failing to give consumers the proper information and documents to return items.
• Misrepresenting and failing to honor rebate, warranty and guarantee offers.
• Falsely advertising its "In-Home Warranty" services.
• Failing to clearly identify the exact items and upgraded products that are under warranty by the seller and/or manufacturer.
• Failing to register Video Computer Store as a fictitious name with the Pennsylvania Department of State.

• Permanently bar the defendants from engaging in deceptive and fraudulent conduct.
• Require the defendants to pay full restitution to consumers.
• Require the defendants to pay a $1,000 civil penalty per violation and $3,000 for each violation involving a person age 60 or older.

Consumers who wish to file a complaint in the case are urged to call Fisher's Bureau of Consumer Protection at 1-800-441-2555 or file electronically at the following web address: www.attorneygeneral.gov.

The suit was filed in Commonwealth Court by Deputy Attorney General Gregory T. Babbitt of Fisher's Bureau of Consumer Protection Office in Philadelphia.

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