Stop us if you've heard this (or done this) before. You're browsing the Web and you see a link to an amazing idea—truly, one of the best ideas you've ever heard.
But you can't buy the product resulting from said idea just yet. It's just an idea, and the owners of the idea want you to help them support the project's development on one of the many crowdfunding sites out there.
So you do that. You throw in $25. $100. Maybe a little more than that, because you believe so strongly in this idea and hope to reap the benefits of some exclusive opportunities for early backers. Time passes. More time passes. The project's estimated launch date slips. Messages from its creators start getting more sparse. You wonder if you're ever going to see the product you were so very interested in. You're a bit annoyed to have lost your money without any way to get it back.
Well, maybe.
Washington attorney general Bob Ferguson announced this past July that his office has won the first victory in a lawsuit against a crowdfunding project creator who didn't live up to his promises. Ed Nash, originator of a Kickstarter campaign for Asylum Playing Cards back in 2012, will be required to pay a total of $54,851 for not actually delivering up on the $25,146-funded project.
"Washington state will not tolerate crowdfunding theft. If you accept money from consumers, and don't follow through on your obligations, my office will hold you accountable," Ferguson said, in a statement.
Of that fairly large sum, a mere $668 will actually go to the projects' backers as restitution for supporting the failed Kickstarter project. Nash will have to pay up a whopping $31,000 in penalties for 31 separate violations of the state's Consumer Protection Act, as well as $23,183 in fees associated with bringing the case to trial to begin with.
So, that's not a great amount of recovery for the 31 backers from Washington who supported the project—out of 810 total. And, yes, other backers are still as out of luck as they were before. However, it might give a few Kickstarter creators a bit of a pause if they're planning on launching a project that might not ever see the light of day. In the end, it might cost you more than you make.
Source: pcmag.com
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