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On June 2, 2016, the first-ever federal jury telemarketing case found Forrest S. Baker III guilty of “deceptive and unlawful” telemarketing practices within his three companies. Defendant Baker is the owner of Feature Films for Families Inc., Corporations for Character LC, and Family Films of Utah, which are responsible for making 117 million illegal telemarketing calls.

This is a groundbreaking FTC case for multiple reasons.

  1. Federal Jury. This case was brought to a federal jury, which is a first for a telemarketing case. Usually, cases of this nature are not tried with a jury at the federal level, but the case of Utah resident Forrest S. Baker III had special circumstances.
  2. Extreme Deception. This case not only dealt with illegally calling those on the DNC, but it also tackled extreme deception within Baker’s companies. Feature Films for Families lied about how much money they gave to nonprofits from film proceeds, and repeatedly called those who asked them to stop, changing their caller ID name to appear as “CUSTOMER SVC”, “FAMILY VALUES CB”, and “VELVETEEN,” in order to deceive consumers into answering their calls over and over again.
  3. Moral Aversion. The three companies owned by Forrest S. Baker III operate under the pretense of encouraging “family movies with family values.” However, the companies are responsible for deceptive and unlawful practices. This lapse in moral judgement is made much worse when considering the moral purpose of the companies.

Baker’s company informed consumers that all of the proceeds of Feature Films for Families DVDs went to the nonprofit Coalition for Quality Children’s Media. In reality, Feature Films for Families received 93 percent of the profits from sales of these DVDs. This deceptive practice, combined with the repeated telemarketing calls to those on the Do Not Call List contributed to the lawsuit against Baker.

the velveteen rabbit

A still from The Velveteen Rabbit (2009).

This was not the first questionable action by Feature Films for Families. In 2009, the company embarked on a telemarketing campaign to promote their film, The Velveteen Rabbit, and encouraged people to buy tickets. Throughout this promotion process, the company called over 2.5 million numbers that were on the Do Not Call List.

Not only did the company commit these violations, the FTC found that the defendant had either actual or implied knowledge of these violations, which means that the penalties could be up to $16,000 per violation.