Antitrust Law Daily Wrap Up, ADVERTISING NEWS: Wal-Mart settles Coca-Cola false advertising case in New York, (Sep 16, 2014)
Organizations Mentioned:Wal-Mart Stores, Inc.
By Greg Hammond, J.D.
New York Attorney General Eric T. Schneiderman has announced a settlement between retail giant Wal-Mart Stores, Inc. and the Attorney General’s office for allegedly advertising a Coca-Cola sale, and charging customers in New York more than the advertised sales price. According to the New York Attorney General’s office, Wal-Mart sold 66,000 12-packs of Coca-Cola at the inflated price.
As part of a Father’s Day sale, Wal-Mart publicized a nation-wide deal, advertising 12-packs of Coca-Cola products for $3.00. However, according to its investigation, the Attorney General’s office found that Wal-Marts in New York charged customers $3.50. Consumers that questioned the inflated price were allegedly told that the national advertisements did not apply to New York, or that the state has a “sugar tax.” Wal-Mart reportedly did not fix the price discrepancy until requested to do so by the Attorney General’s Office. The markup of over 16 percent of the advertised price violated New York State’s General Business Law, the Attorney General alleged.
“There has to be one set of rules for everyone, no matter how rich or how powerful, and that is why our office must ensure that even the largest corporations cannot advertise one price and then charge a higher one to New Yorkers,” Schneiderman said. “Whether it’s securing the largest financial settlements in U.S. history to address misconduct that crashed the economy, or settling cases with the nation’s largest retailers, this office will continue to stand on the side of ordinary new Yorkers.”
According to Schneiderman, Wal-Mart will be required to pay more than $66,000 in penalties and other costs, pursuant to the settlement agreement. In addition, the company will be required to improve its internal reporting to respond more quickly to information received by consumers on overcharges, and must change its business practices to comply with New York state law.
Attorneys: Benjamin Bruce, Assistant Attorney General.
Companies: Wal-Mart Stores, Inc.
News: Advertising StateUnfairTradePractices