Radiate Athletics, a West Chester company the Wall Street Journal listed as a "Startup of the Year" contender in 2013 after it launched an online Kickstarter campaign to fund shirts "that change color depending on the wearer's exertion level," has agreed to settle a consumer complaint filed by the state Bureau of Consumer Protection in 2015, according to Attorney General Josh Shapiro's office.
The Kickstarter funding and sales campaign was successful, but Radiate's supplier was unable to handle the orders, and the company fell far behind its delivery promises, the Journal reported in 2014.
In a statement issued Monday, Shapiro noted that Radiate "failed to deliver the shirts as promised to many consumers."
In the settlement, the company promises "to deliver the shirts this month to approximately 1,600 consumers who paid for shirts and have not yet received them," and to pay restitution for "shirts which are defective, totaling $2,437."
Calls to a onetime phone number for Radiate were not answered.
According to Shapiro, Radiate founder Kenneth E. Crockett Jr. set up the campaign to raise $30,000 to finance the $35 shirts but "kept the Kickstarter campaign going until Radiate raised $579,000 from 8,556 consumers. ... Complaints began surfacing from consumers almost immediately" that the shirts were "defective" or never arrived.
"We just stopped hearing from them," one of the Kickstarter investors, Josef Oggier of Mechanicsburg, told the state, according to the statement from the Attorney General's Office.
As part of the settlement, Crockett also agreed to pay $10,000 in "civil penalties and costs," the statement says.
"Consumers who file complaints with the Bureau of Consumer Protection before June 2, 2017, will be considered for inclusion in the final restitution to be paid by Radiate," according to the statement. For more information, go to www.attorneygeneral.gov or email email@example.com.
Shapiro warned against investing in or buying from online companies whose products don't seem "realistic."