FTC Probe Prompts BurnLounge Fallout
The CEO of digital download community BurnLounge resigned this week in the wake of an FTC investigation into the company's business practices. Alex Arnold is out; Grant Johnson, a board member and entertainment industry veteran, is in.
"This change in management is a first step towards a reinforced focus on building the entertainment company we’ve always envisioned,” said BurnLounge co-founder Stephen Murray in a press release. Co-founder Ryan Dadd said Johnson is "absolutely the right addition to our team."
Earlier this month, the FTC filed a complaint in a federal court alleging that BurnLounge is operating an illegal pyramid scheme. The firm believes the filing "does not reflect the reality or substance of our business." The court denied the agency's request for a temporary restraining order and BurnLounge is working with the FTC to resolve the case.
Read more about the FTC's complaint here.
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