Washington State

Office of the Attorney General

Attorney General

Bob Ferguson

Pink elephants may go mysteriously unnoticed, but not BlueHippo. The company, which pitches personal computers to those with less-than-perfect credit, was the target of a federal lawsuit resolved last year. BlueHippo made a splash again when the Washington Attorney General’s Office announced today that it, too, reached a settlement.

“BlueHippo’s misleading marketing tactics and cancellation policies left many consumers seeing red,” said Assistant Attorney General Shannon Smith, of the office’s Consumer Protection Division. “Our settlement includes a provision to prevent the company from representing that its prices are less than or equal to those offered by product manufacturers.”

The defendants will pay $25,000 in attorneys’ fees and legal costs and offer refunds to qualifying Washington consumers, including some who may not have qualified for restitution under last year’s Federal Trade Commission settlement. A $25,000 civil penalty was suspended provided the defendants comply with the settlement terms.

BlueHippo targets consumers who are unable to obtain credit from conventional sources. Consumers who order and finance products such as computers and televisions through BlueHippo are charged several hundred dollars more than the manufacturer’s suggested or retail price. They pay an activation fee of typically $99. Consumers must make several payments before the item is shipped and additional payments before they officially own the merchandise.

“The company’s true colors became apparent once consumers tried to cancel their shipments,” Attorney General Rob McKenna said. “Some were charged a $175 cancellation fee and others lost the payments they had already made.”

Read today's news release for more information.

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