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Uploaded: Friday, October 12, 2012, 10:52 AM
Rite Aid to pay $800,000 for false advertising
Lawsuit alleged company violated state laws with +Up Rewards and Wellness card advertising campaigns
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by Sue Dremann
Palo Alto Weekly Staff
Rite Aid Corporation has agreed to pay $800,000 for false and deceptive advertising. The company has settled a civil law-enforcement suit with the Santa Clara County District Attorney's Office and DA offices in Riverside and Ventura counties, the Santa Clara County DA has announced.
Rite Aid has locations in Mountain View, with one at 1040 Grant Road and another at 685 San Antonio Road.
The suit filed in San Diego County alleged that Rite Aid violated state laws prohibiting false and deceptive advertising in its +Up Rewards and Wellness card advertising campaigns. The company also failed to redeem gift cards with a cash value of less than $10.
The complaint alleges Rite Aid advertisements conveyed to consumers that they would pay lower prices for items purchased using the Rite Aid Wellness+ Card.
Once at the register, the customer could not purchase the item at the advertised price. Instead, the customer received a printed coupon printed on the end of their receipt for savings on a future purchase. The coupon had an expiration date and other restrictions.
Rite Aid failed to adequately inform consumers that the product could not be purchased at the advertised price.
In the settlement, Rite Aid agreed to clearly display the program's limitations and all the conditions necessary for customers to purchase items for advertised prices.
Rite Aid will also program their credit card terminals to inform the customer when their gift card has a balance of less than $10. The terminal will be prompted to ask the customer if he or she wishes to redeem the gift card for the cash balance.
"This is a victory for all California consumers. The law provides that advertising must be clear such that the consumer knows what he or she will pay for an item before making a purchase and it must not be deceptive," Santa Clara County Prosecutor Tina Nunes-Ober said.
Santa Clara County, home to 21 Rite Aid stores, will receive $175,000 in civil penalties and be reimbursed $1,457 for the costs of the prosecution. Rite Aid will be bound by the terms of a permanent injunction prohibiting similar violations in the future.Are you receiving Express, our free daily e-mail edition? See a sample and sign-up for Express.
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Posted by voter, a resident of the Old Mountain View neighborhood, on Oct 12, 2012 at 12:35 pm Big corporations scamming middle class consumers. If Romney wins the election, expect this kind of law enforcement to end.
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Posted by Cost, a resident of the St. Francis Acres neighborhood, on Oct 12, 2012 at 12:58 pm It seems that the prosecution probably cost a lot more than $1457.
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Posted by USA, a resident of the Old Mountain View neighborhood, on Oct 12, 2012 at 1:05 pm If Obama wins the election, expect prices to continue to rise with increased regulation and corp taxes.
BTW, who do you think pays corp taxes? Corporations cannot just print money like Obama can. Every additional dollar of tax must be passed on to the consumer.
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Posted by OK People, a resident of the Sylvan Park neighborhood, on Oct 12, 2012 at 3:32 pm This story is about Rite Aid, not about Romney vs Obama. Keep your politics to yourselves. You get to vote in November...until then, we don't care.
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Posted by Sabrina, a resident of the The Crossings neighborhood, on Oct 12, 2012 at 9:12 pm Hahaha, $800,000 adds up to approximately 0.000032% of Rite Aide's total 2011 revenue of $25.2 billion. I think labeling this as a "slap on the wrist" would be overstating the situation.
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Posted by Mr. Nice, a resident of the Blossom Valley neighborhood, on Oct 13, 2012 at 6:41 am I buy all my 420 supplies there.
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Posted by huh?, a resident of the Cuernavaca neighborhood, on Oct 13, 2012 at 7:00 am Suckers are born every minute. That's all this was really about. Nice to see the DA wasting time and money on this.
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