Emergency Service Firm Accused of Coercive Sales : Consumers: State, eight counties claim Chatsworth company pressured elderly and disabled to pay thousands of dollars for Life Alert system.
A Chatsworth firm’s national television advertising campaign depicted a gray-haired woman lying helpless at the bottom of a staircase, crying, “I’ve fallen and I can’t get up!” It urged the elderly and disabled to buy an emergency alarm system that could supposedly summon help faster than dialing 911.
After an undercover sting operation by district attorney’s investigators, the firm, Life Alert Emergency Response Inc., this week became the target of a $2-million lawsuit accusing it of high-pressure and misleading sales tactics aimed at coercing mainly elderly and disabled people into paying up to $5,000 for the system.
Investigators said the system consists of a portable “help button” that can be worn around the neck or mounted on a wall if a person is bedridden. Pushing the button activates an answering-machine-like device that dials the Life Alert office in Chatsworth. Operators there, in turn, call emergency services such as paramedics.
The lawsuit does not question the system’s effectiveness. Instead, it claims that sales representatives wore customers down with hours-long pitches and falsely implied that the company had better access to emergency services through a “hot line” that bypassed dispatchers. Deluxe systems also included fire and burglar alarms.
Eight counties, including Los Angeles, joined the state attorney general’s office in filing the suit after discovering during a meeting of consumer attorneys last year that they had independently received similar complaints about the 4-year-old company.
A Life Alert training manual, obtained by an investigator who posed as an aspiring salesman, encourages sales representatives to “go for the emotional sale, not a logical sale.” The manual includes such advice as, “Create the need and desire by using love and concern” and, “Put your client in a position where he is forced to face a potential emergency of his loved one.”
The suit includes statements from about 40 dissatisfied Life Alert customers, said Jeffrey Holtzman, a deputy district attorney in Sonoma County, where the lawsuit was filed.
Eric Bordo, the advertising director for Life Alert, said the company would not respond to the specific charges. However, Bordo accused the district attorneys involved of political motives in filing the suit and said his office had received a steady stream of calls from satisfied customers since media reports of the lawsuit emerged.
“Out of hundreds of thousands of in-home demonstrations of Life Alert, a small percentage of people have complained, less than 1%. Always it’s the squeaky wheel that draws attention,” he said.
One dissatisfied customer included in the suit, Antonia Lopez of San Jose, said a salesman tired her out with a three-hour pitch in 1989, then persuaded her to pay $800 down with her new Visa card.
“I got tired, I was hungry, I just said, ‘OK, I’ll take it.’ ” said Lopez, 68, who is bedridden with rheumatoid arthritis.
Lopez said she tried to cancel the system’s installation the following day, within the three-day cooling-off period required for home solicitations by state consumer laws, but installers arrived anyway. Three months later, after contacting a consumer rights group, she finally got the system removed, but only $300 of her down payment was returned.
Holtzman and other investigators said they had collectively received more than 100 additional complaints on Friday as news of the lawsuit spread. They said many of those callers will be included in the suit and will share in any financial award.
“We believe this is just the tip of the consumer iceberg,” he said.
Jean Huebner was among the 30 people who called Los Angeles County investigators Friday. Huebner, 70, said she purchased a Life Alert device two years ago when she lived by herself in a mobile home in Canyon Country. The device, which included a smoke alarm, cost $2,500, plus a $29 monthly rental fee.
Huebner said she tried to cancel the rental fee after she moved last year to a senior citizens apartment complex in Burbank. She did not need the system any more because her new building had built-in medical alarms, she said.
“I tried to get them to stop billing me but they wouldn’t. I tried to sell it but I couldn’t. . . . It’s sitting under the bed. I don’t know what to do with it. It’s just money down the drain.”
Isaac Shepher, owner of Life Alert, has been the target of one previous consumer protection lawsuit. The Los Angeles County district attorney accused Shepher in 1985 of misleading advertising for a purportedly therapeutic lounge chair. Advertisements claimed that the chair, which cost $2,000 to $3,000, was effective in treating high blood pressure, heart disease and bad backs. The suit was settled out of court for $113,000.
Shepher, who lives in Woodland Hills, is also owner or partner in several other companies, including a development firm, L.A. Hebrew Media Inc. and L.A. Hadshot, a 20,000-circulation Hebrew language weekly newspaper.
Of 30 or so emergency response systems in the country, Life Alert is one of two that advertises regularly on television, according to Lee Norrgard, an investigator with the American Assn. of Retired Persons. Norrgard said the systems are useful for the elderly, but can cost as little as $300, instead of the $4,000 investigators estimated Life Alert charges.
Norrgard estimated that 450,000 households currently have some kind of response system, up from about 200,000 in 1987.
“The principal users tend to be older people, toward the 80 range, and that is of course the fastest growing segment of our population, so it will continue to rise,” he said. “Our concern is that you’re getting into products where there’s not a lot of consumer information available and where there’s not a lot of consumer awareness.”
