Technology

Kim Kardashian was used by Fort Lauderdale startup to mislead customers, suit says

A lawsuit alleges that neither JetSmarter nor Kim Kardashian initially disclosed the megaceleb was a paid endorser of the Fort Lauderdale-based startup.
A lawsuit alleges that neither JetSmarter nor Kim Kardashian initially disclosed the megaceleb was a paid endorser of the Fort Lauderdale-based startup. Truth In Advertising via Beffa Law

JetSmarter, the Fort Lauderdale-based private jet startup that Silicon Valley has valued at more than $1 billion, used celebrities including Kim Kardashian and Petra Nemcova to mislead customers, a new lawsuit alleges.

The complaint, filed in L.A. County Superior Court in California earlier this month, does not name the celebrities as defendants. But plaintiff Derek Milosavljevic, a JetSmarter customer, accuses JetSmarter of using the stars to plug the company without having them disclose that they were paid promoters.

“JetSmarter’s advertisements are unfair, unlawful, deceptive, and misleading, and have violated and continue to violate state and federal laws and regulations,” the suit alleges.

The suit shows a screen grab, captured by watchdog group TruthInAdvertising.com, of Kardashian posting on Instagram about the company. “I’m truly obsessed with the @letjetsmarter app! I’m a member and it has changed my traveling life! Download the app! #ReadyJetGo #JetSmarter,” she wrote. JetSmarter then re-posted it.

Screen Shot 2018-08-17 at 11.36.33 AM.png
A lawsuit alleges that neither JetSmarter nor Kim Kardashian initially disclosed the megaceleb was a paid endorser of the Fort Lauderdale-based startup. Truth In Advertising via Beffa Law

Here’s what the post looks like now, with “#ad” now placed at the beginning.

Kardashian also Tweeted about the company, and did not immediately indicate it was an ad.

On her Instagram feed, Nemcova posted, and JetSmarter re-posted, a photo captioned: “Captain we are ready for takeoff. To the new adventures with JetSmarter.” Nemcova has not updated the Instagram post to indicate it is an ad. A JetSmarter spokesperson Ronn Torossian did not immediately respond to a comment to confirm that Nemcova was a paid endorser.

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Milosavljevic is leveling other accusations against the company. He says they alter their user terms “unilaterally, at dizzyingly frequent intervals, and without any notice whatsoever,” and force subscribers to pay additional fees that he says were not laid out when he initially signed up.

He also says JetSmarter has added an illegal clause to its user agreement that makes customers promise not to make any negative comments about the company, and believes he was illicitly penalized by the company when he did so by having his membership unlawfully terminated.

This amounted to “stifling legitimate, truthful, and legally-protected speech that could have prevented JetSmarter from perpetrating and perpetuating its continued fraudulent, unlawful, and deceptive practices on consumers throughout [California],” the suit says. JetSmarter continues to monitor online travel and review websites and unlawfully terminates or fails to renew memberships of consumers who make negative statements or offer negative opinions about the company, the suit claims.

“This case was filed by a former member who we did not renew and he became disgruntled,” said Torossian. “We expect this law suit will be thrown out of court as it is frivolous and has no merit.”

Milosavljevic is seeking $2 million in relief, and for a judge to halt the practices he accuses JetSmarter of engaging in.

This is the second suit filed against JetSmarter this month, the blog Private Jet Card Comparisons reports. A New Jersey couple has also accused the company of using misleading sales tactics. That suit has since been referred to arbitration.

In February 2017, JetSmarter’s former president was arrested on grand theft charges and faced extradition to California. The allegations against Gennady Barsky stem from dealings unrelated to the startup. He has pleaded not guilty.

CEO Sergei Petrossov has told the Sun Sentinel the company employs about 150 people at its downtown Fort Lauderdale headquarters.

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