A communication was sent to me a few days ago, by an ex-associate publisher of Travelhost Magazine, in conjunction with other ex-associates who may be considering a class-action lawsuit against Travelhost Magazine, James Buerger, and general council John Price. I said I would help to relay the message, as we have hundreds of readers here at THE PUBLISHERS ADVOCATE. Many of our readers are ex-associate publishers, and current ones as well, who may be affected by this information.
I would like to remind my readers that I am not a lawyer, nor do I give legal advice. It is the duty of THE PUBLISHERS ADVOCATE, as a news source, to relay this information, unadulterated, in its original form…the way it was sent to me.
Take a look:
To: All current and former Travelhost Associate Publishers, and current and former national and regional advertisers.
We represent a group of current and former Travelhost Associate Publishers and are considering a law suit against Travelhost Magazine, Travelhost Inc, its Chairman of the board and CEO Jim Buerger, and it’s General Counsel John Price.
We believe that Travelhost has deliberately and knowingly mislead, misinformed and fraudulently induced a number of individuals during the sales and selection process of Associate Publishers and that Travelhost Inc, has knowingly and deliberately mislead, misrepresented and fraudulently induced hundreds of former and current national and regional advertisers to advertise in Travelhost Magazine. It is our opinion that John Price, Travelhost General Counsel, in concert with Jim Buerger has knowingly devised and prepared the necessary documents and marketing strategies and schemes that allowed and encouraged the continuing practice of fraudulently inducing new distributors and associate publishers into the Travelhost network and has thus implicated himself as a co-conspirator in what we believe to be the unlawful misrepresentation of the Travelhost distributorship and optional associate publisher business model as well as the misleading and misrepresented value of placing national or regional advertisements in Travelhost Magazine.
Our primary grievances include, but are not limited to, come from the “Optional Associate Publishers Agreement”:
Items 2 & 3:
AP shall be entitled to advertising space for use or sale:
We believe that most of you were clearly advised that by purchasing the optional Associate Publisher agreement you would have “$75,000 credit towards the National and/or Regional ad space and that this was the way to “recoup your entire investment” You were probably advised that Travelhost had been printing nationally for 40 +/- years and that many national advertisers were eager to advertise in such a well respected and widely read publication. Some of you were told that Travelhost had a list of national advertising clients waiting for national and regional ad space to become available to them and that Travelhost policy was to allow the AP’s to utilize their unsold ad space and the Associate Publisher would keep all the revenue
The reality that most of you faced was that Travelhost, Inc rarely if ever sells national ads and certainly not at Travelhost rate card pricing and that it was nearly impossible for an AP to do so because Travelhost could not and would not provide accurate, legitimate readership and distribution statistics that are advertising industry recognized, thus causing the promise of reward to be without merit
In addition, to this day Travelhost, after 43 years of operation, has failed to provide ANY type of sales or presentation materials or guidelines or even an honest and clear explanation of the process to the Associate Publisher to have and use to honestly and fairly present the value to a prospective national or regional advertiser. They have never to our knowledge provided even the most basic presentation materials that would allow an AP to even understand the national and regional print cycle nor even an example of what Travelhost, Inc includes as a sales presentation to national or regional advertisers. We believe that Travelhost has knowingly and deliberately induced, by misrepresentation and omission, each Associate Publisher to either commit or attempt to commit fraud on behalf of Travelhost, Inc and we believe that this omission constitutes a level of deceit and misrepresentation to the AP as well as the advertiser. Collectively, after many interviews with former and current associate publishers we have come to believe that Travelhost has misrepresented and exaggerated the value of this and by including it as an enticement to spend the additional $30,000 required for the “optional associate publisher agreement” Travelhost has committed an act of fraud. We believe that Travelhost has offered what the Federal Trade Commission defines as a “Phantom Opportunity”
We are aware of the many advertisers seen in the national and regional sections of your magazines. We estimate the greatest percentage are placed by the AP’s at a drastically reduced price from the published rates found in the Travelhost National Media Kit which is what Travelhost recommends and in fact insists they themselves do not discount.
Ad revenue sharing:
We believe that Travelhost, by including the language detailing the commissions to be paid to AP for advertising sold into their market, have suggested that this actually occurs. Collectively, after many interviews with former and current associate publishers we have concluded that this sort of cross-selling does not and has not occurred to the level that it should have been touted as having any value whatsoever. Another “Phantom Opportunity”
Publication discount, Associate Publisher shall be entitled at all times to wholesale pricing:
We are aware that Travelhost has claimed, and testified that their definition of “wholesale pricing” is that the Travelhost pricing schedule identified as “wholesale pricing” is less than what Travelhost’s pricing schedule for “retail pricing” is and is therefore “wholesale pricing”. Using the Travelhost formula for definitions, we assume that Travelhost could and may have decided that round is really square, or that blue is now red, or that fraud is now honorable. It has already been established that Travelhost ‘wholesale” is half of what retail commercial printers will bill for at least equal quality product. We believe that Travelhost testified that they are the ONLY printer in America that will print a magazine and provide the “extras’ such as providing proofs, making sure that the images and text all fit on the page, and providing links to generic information on the web and arranging webinars that help publishers with their publication, and that these services somehow makes them a publisher, not a printer, because no other commercial printer will do these things. We already have a number of commercial printers eager and willing to testify and have provided documentation showing that they do all of these things, and more. They charge retail, which is generally half of what Travelhost charges for their printing services which include the “extras”. Collectively, after many interviews with former and current associate publishers we have concluded that the onerous printing prices represented by Travelhost as “wholesale” have been the leading cause of failure to successfully build a profitable business and in most cases has driven you in to bankruptcy. Furthermore we believe that there is a best marginal value to the promise of regional/national ad sales and that there is absolutely no value to the commission sharing scheme represented by Travelhost and that the additional $30,000 for the “optional” Associate Publishers agreement promises “wholesale publishing pricing” which does not occur. We believe and intend to prove in a court of law that Travelhost has knowingly, willfully and deliberately set forth to collect the additional $30,000 with the historical facts proving that Travelhost knew and knows that it would take on average 4.5 years for an AP to recoup the additional $30,000 through the discounted pricing, and that historical data will prove that Travelhost clearly recognizes and knows that rarely does a Travelhost associate publisher even stay in business that long!
We know that each market shown to be represented by Travelhost on the Travelhost website, www.travelhost.com is either a market that is still in production and printing a magazine or that the market has gone out of business and is in actuality not a market being represented by Travelhost with the majority of the markets shown being “dark” markets. Each market, whether “dark” or live; contain the last or current issue of the Travelhost Magazine that was printed in that market. Travelhost has testified that they, Travelhost Inc, own ALL materials submitted to Travelhost to be printed in each market. The maps you bought and paid for, all images and photographs, the ads you or your client paid to be designed, the feature articles you wrote or paid for are according to Travelhost their property. There is no compensation to either the former or current associate publishers for use of any of this intellectual property. We believe the Travelhost scheme is to secure enough intellectual property, via the “publication builder” to render the associate publishers and distributors “without value” in the plan to devise and promote www.travelhost.com as a web based travel publication featuring booking, packaging and advertising opportunities for the sole use and profit of Travelhost, Inc. According to sworn testimony by Travelhost, Inc, the matter of intellectual rights is spelled out to you in their “Production Manual” and by virtue of you receiving the “Production Manual” you have agreed to these terms. We have thoroughly reviewed several Travelhost Production Manuals as well as each version of “Distributorship Agreements” and “Optional Associate Publisher Agreement” and find no language pertaining to the relinquishment of your intellectual property and believe that you are due considerable monetary compensation for its use by Travelhost, Inc and www.travelhost.com.
Further, we believe that most of the states represented by former or current distributors and associate publishers will find that Travelhost is in violation of state franchise laws and we are positive that they have violated the spirit of the federal franchise laws. We intend to pursue this vigorously. We are aware that Travelhost tries very hard to hide the fact that they have crossed the threshold of being a franchise, but the courts have already upheld, in some states, that Travelhost has and is in violation of franchise laws. Probably another fact they failed to mention to you.
We have complete confidence that Travelhost has no justifiable defense or precedent to exonerate them from what we believe to be egregious acts of fraud and misrepresentation. There is precedent and it is a fact that Travelhost has already been found guilty of such fraud and misrepresentation and have settled cases with former associate publishers requiring plaintiffs to agree to a non disclosure statement effectively keeping these facts hidden.
We are certain that many of you have joined the Travelhost network and lost your entire investment, after Travelhost had already been found guilty of fraud and that you were not informed that you were spending $60,000 to be part of a brand that was operating and indeed recruiting you under circumstances very similar if not identical to what they were found guilty of.
National and Regional Advertisers ripped off
We are sending this to all current and past national and regional advertisers because we believe you were and are victims of fraud and misrepresentation in that you’ve purchased a national advertisement in Travelhost Magazine naturally assuming that by paying $36,000 for a full page national ad or whatever price the associate publisher or Travelhost Inc, could sell it for, were actually going to have their ad in ALL Travelhost markets, nationally, when in reality the ad would run in a maximum of one-third of the publishing markets. The only way to actually have an ad in all Travelhost magazines the advertiser would be required to purchase a minimum of three months of ads, and in some cases four months, a verified fact that many advertisers were unaware of. We are convinced that there no advertisers who would knowingly pay for a “national ad” that was not actually in a national publication, nationally!
We are currently gathering contact information for all past and current national/regional advertisers in Travelhost Magazine
As a note of caution; Travelhost has recently testified that if a National or Regional advertiser were to challenge the scheme and sue for reimbursement for their ad dollars that the AP who sold the ad would be liable for those damages and re-imbursements, NOT Travelhost, Inc. We intend to seek damages sufficient for ALL associate publishers who may have sold any regional or national ad space to reimburse any advertiser whose challenge to the representation of readership and distribution cannot be satisfied and for advertisers who are part of this suit to be paid directly from forthcoming settlements, if any.
We believe and it is our opinion that as a former or current Travelhost associate publisher you are owed damages at minimum
1. One-half of what you spent on printing with Travelhost. We encourage you to add those numbers up.
2. Your entire $30,000 spent for the Optional Associate Publishers agreement.
3. Considerable punitive damages: the amount of punitive damages, if any is determined by a jury of your peers.
4. an undetermined but substantial amount based on the unauthorized use of intellectual property, likely to be part of punitive damages determined by a jury
We fully expect that Travelhost will challenge each and every claim we are making but send this with extreme confidence that Travelhost has no desire or ability to mount a credible defense when there are at least 100 former and current associate publishers willing to testify to the facts as presented in this letter of notice. We further believe that Travelhost has no desire to attempt to justify to the vast number of national and regional advertisers they have mislead and misrepresented themselves to.
We believe that we have many things in our favor.
We have the truth, we have the facts, we have documentation, we have investigative journalists and reporters in the media and press that are eager to learn more and anxious to publicize their findings, and we have Travelhost with a clear track record of what we believe to be fraudulent operations over many years, and we have many of you who will be part of this fight for justice.
If you are in agreement with any of these assertions and feel as though you too were fraudulently induced into the Optional Associate Publishers agreement or that your market was not profitable because of the onerous printing costs which were represented as “Wholesale”, and that if your printing costs were half what you paid Travelhost until you went broke that you would have been profitable and probably still in business, or that you are now struggling to meet the print costs charged by Travelhost, or that you would like to add considerable profit to your business by paying “fair market” pricing for your printed materials than please contact THE PUBLISHERS ADVOCATE or Randy Duplecion. We will gather all contacts and comments to be delivered to the legal team selected to handle the “multi-plaintiff complaint.
If you have purchased either “National” or “Regional” ads to be placed in Travelhost Magazines it is very likely that you have reimbursements and damages due to you as well, you too may contact us firstname.lastname@example.org
If you feel as though the allegations detailed in this memo are truthful and if you desire to stop Travelhost from continuing these predatory practices I urge you to contact the FTC and the Attorney General of your state and to also write a letter to your congressional representative to file an official report and complaint. We also suggest you consider joining us in this lawsuit.
THE PUBLISHERS ADVOCATE
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