Pre-Paid Legal: FTC papers part of ongoing process

posted: 81 DAYS 7 HOURS AGO

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ADA, Okla. -Pre-Paid Legal Services Inc., a network of independent law firms, clarified on Friday that a draft lawsuit it has received from the Federal Trade Commission is part of an ongoing process.

The Ada, Okla., company had said Thursday it received a draft of a proposed lawsuit and that the FTC may decide to formally sue Pre-Paid Legal Services over allegedly misleading representations made by its identity theft prevention program.

The news sent shares down 19 percent Thursday to close at $33.27.

But on Friday the company clarified that the proposed charges related only to marketing of its Affirmative Defense Response System, which offers businesses and individuals a way to reduce risk of identity theft. It also said it believes none of the membership fees collected through the program would be subject to refunds.

In afternoon trading Friday the stock rose $2.42, or 7.3 percent, to $35.69.

2009-11-20 12:57:05