Pre-Paid Legal Services Clarifies Previous FTC Announcement


<p>ADA, Okla., <chron>Nov. 20</chron> /CNW/ -- Pre-Paid Legal Services, Inc. (NYSE:   PPD) wishes to clarify information provided in our press release issued yesterday, <chron>November 19, 2009</chron>. We believe the proposed draft complaint from the Federal Trade Commission ("FTC") referred to in yesterday's release is the next step in an ongoing process between us and the FTC that began in <chron>March 2007</chron>. This process has been the subject of prior press releases and disclosures in previous public filings. The proposed draft complaint narrowly focuses on our Affirmative Defense Response System ("ADRS") marketing program and specific representations regarding identity theft and data privacy issues. We believe the permanent injunctive relief proposed by the FTC pertains only to our ADRS marketing program.</p>
<p>We began ADRS in 2006 as a complimentary program for businesses to learn more about identity theft and data security. The ADRS marketing program is a small part of our core business model, and is associated with a relatively small percentage of our revenues. Regarding the proposed disgorgement of proceeds, we received no fees for the ADRS presentation so we believe there are no fees or proceeds at issue that would be subject to disgorgement. Even if the FTC were to pursue disgorgement of membership fees pertaining to the underlying memberships written in group accounts solicited through the ADRS program, such fees represent less than 2% of all our total membership fees collected since <chron>January 1, 2006</chron> and represent approximately 4.5% of our current membership fees in-force. We have responded to each request from the FTC and will continue to cooperate with the FTC to reach a mutually agreeable resolution.</p>
<p>About Us - We believe our products are one of a kind, life events legal service plans. Our plans provide for legal service benefits provided through a network of independent law firms across the U.S. and <location>Canada</location>, and include unlimited attorney consultation, will preparation, traffic violation defense, automobile-related criminal charges defense, letter writing, document preparation and review and a general trial defense benefit. We have an identity theft restoration product we think is also one of a kind due to the combination of our identity theft restoration partner and our provider law firms. More information about our products and us can be found at our homepage at <a href=""></a>.</p>

    Forward-Looking Statements
<p>Statements in this press release, other than purely historical information, regarding our future plans and objectives and expected operating results, dividends and share repurchases and statements of the assumptions underlying such statements, constitute forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934. The forward-looking statements contained herein are based on certain assumptions that may not be correct. They are subject to risks and uncertainties incident to our business that could cause actual results to differ materially from those described in the forward-looking statements. These risks and uncertainties are described in the reports and statements filed by us with the Securities and Exchange Commission, including (among others) those listed in our Form 10-K, Form 10-Q and Form 8-K, and include the risks that our membership persistency or renewal rates may decline, that we may not be able to continue to grow our memberships and earnings, that we are dependent on the continued active participation of our principal executive officer, that pending or future litigation may have a material adverse effect on us if resolved unfavorably to us, that we may have compromises of our information security, that during an economic downturn in the economy consumer purchases of discretionary items may be affected which could materially harm our sales, retention rates, profitability and financial condition, that we could be adversely affected by regulatory developments, that competition could adversely affect us, that we are substantially dependent on our marketing force, that our stock price may be affected by short sellers, that we have been unable to increase our employee group membership sales and that our active premium in force is not indicative of future revenue as a result of changes in active memberships from cancellations and additional membership sales. Please refer to pages 15 - 17 of our 2008 Form 10-K and pages 7 and 8 of our <chron>September 30, 2009</chron> Form 10-Q for a more complete description of these risks. We undertake no duty to update any of the forward-looking statements in this release.</p>


For further information: For further information: Keri Prince, +1-580-436-1234, for Pre-Paid Legal Services, Inc. Web Site:

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