NY Attorney General Secures Settlement Over Misleading Sales

Over the past year, there has been a​n​ increase in the number of lawsuits and regulatory investigations ​involving how retailers advertise discounts and sales. In these cases, challengers have generally alleged that the retailers misled consumers into believing they’re getting a good deal during a sale, when the sale price is actually the price at which an item is usually sold. Last week, the ​NY Attorney General​ announced the latest settlement in this area.

The AG’s office started tracking Hobby Lobby ​ads that promoted ​30% off and ​50% off​ ​sales, and discovered that the ​company advertised ​certain products as ​being on sale for more than 52 consecutive weeks. The AG determined that ​these ​“never-ending” sales​ ​violated New York​ l​aw​s​. As part of the settlement, the company agreed to change its advertising practices, contribute $138,600 in supplies to public schools in Upstate New York, and pay $85,000 in civil penalties and costs.

If you​‘re a retailer, ​you should pay ​close ​attention to ​these recent cases (including this one) and state pricing laws, particularly when you​’​re advertising discounts, sales, or other price reductions. If​ ​you aren’t careful with how you structure​ ​your sales, ​they could cost you a lot of money.​