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Crowdfunding campaign hit with first consumer-protection suit in nation

Kickstarter has put up some impressive numbers since the popular crowdfunding site opened for business five years ago this week: more than $1 billion pledged by more than 5 million people to fund 60,000 creative projects.

But here’s one milestone it could have done without: as the unwitting host to the first consumer-protection complaint to be filed in the nation against a company suspected of crowdfunding fraud.

ASYLUM 05-02-14As reported by The Seattle Times, Washington state Attorney General Bob Ferguson filed a lawsuit Thursday alleging that the owner of a Nashville, Tenn., firm never lived up to his promises after running an “Asylum Playing Cards” crowdfunding campaign through Kickstarter to create a deck of “retro-horror” playing cards.

The suit, filed in King County Superior Court, claims that Edward Polchlopek III — also known as Ed Nash —  and his company Altius Management raised $25,106 from 810 people in 2012 for the project.

In return, the financial backers – including at least 31 from Washington state – were supposed to receive playing cards, poker chips, dice and other items as part of the deal, according to the suit.

Since no one did – and no money has been returned – Ferguson went to court to seek restitution and fines up to $2,000 per person under the Consumer Protection Act. Given the number of investors involved, those fines could reach as high as $1.6 million.


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“Consumers need to be aware that crowdfunding is not without risk,” Ferguson said in a statement. “This lawsuit sends a clear message to people seeking the public’s money: Washington state will not tolerate crowdfunding theft.”

For its part, a spokesman for Kickstarter told the Times it wants “every backer to have an amazing experience, and we’re frustrated when they don’t.”

“We hope this process brings resolution and clarity to the backers of this project,” he said.

Here’s a link to  the complaint.