November 10, 09

NEWS / New Jersey Settles Suit Against Target Corporation

Newark – Attorney General Anne Milgram today announced that Target Corporation has agreed to a $375,000 settlement to resolve a lawsuit alleging that Target Stores sold infant formula and non-prescription drugs beyond expiration dates, sold merchandise that did not match posted prices, and failed to post prices on its merchandise. The settlement also resolves allegations that Target failed to maintain sufficient quantities of advertised merchandise, failed to post its raincheck policy, failed to post bicycle safety notices, and violated a previous Consent Order with the New Jersey Division of Consumer Affairs.

As part of the settlement, Target has voluntarily created a new senior management position, entitled Group Pricing Compliance Specialist, whose duties include monitoring compliance with Target’s policies as well as the settlement terms as to price accuracy. Target has also agreed to provide all Target employees in the state with initial training as to price accuracy. The compliance position and the initial training shall be in effect for two years.

“We will continue to monitor all major retail chains to ensure that consumer rights are protected and out-of-date non-prescription drugs and infant formula are not available for sale on store shelves,” Attorney General Milgram said.

The Office of the Attorney General, the Division of Consumer Affairs, and the Office of Weights and Measures filed suit against Target in September 2008, after inspections of 21 of the company’s 40 New Jersey stores by investigators from the Division’s Office of Consumer Protection and the Office of Weights and Measures.

Under the settlement, Target has agreed not to sell or offer for sale any non-prescription drugs or infant formula beyond their expiration dates, to check the expiration dates before displaying such merchandise for sale, to conduct weekly checks of the expiration dates of the merchandise offered for sale and to arrange for the destruction or return to the manufacturer or supplier of any expired merchandise removed from the store shelves.

Further, Target agreed not to sell or offer for sale merchandise at a price that exceeds the price posted at the point of display. Target also agreed not to sell or offer for sale any merchandise unless the total selling price is plainly marked by a stamp, tag, label or sign. In addition, Target agreed to have a sufficient quantity of advertised merchandise to meet anticipated demand or shall advertise merchandise as available in limited quantities. Finally, Target agreed to conspicuously post its raincheck policy as well as the notices required by the state’s Bicycle Safety Act and Regulations.

“We expect retailers to treat their customers fairly, and that means proper pricing and having merchandise available as advertised,” said Consumer Affairs Division Director David Szuchman. “It is significant that Target has agreed to create a new senior management position specifically to ensure compliance with the company’s polices and the terms of the settlement as to price accuracy.”

The $375,000 settlement amount represents $350,000 in civil penalties, $10,000 to reimburse the state’s attorney fees, and $15,000 to reimburse the state’s investigative costs.

Deputy Attorney General Jah-Juin Ho of the Consumer Fraud Prosecution Section represented the state in this action.

The state previously reached settlements with Rite Aid Corporation ($475,000) and Duane Reade ($200,000) to settle actions which concern similar allegations of sale of expired merchandise and sale of merchandise at a price that exceeds the price posted at the point of display. Suits are still pending against Wal-Mart and Drug Fair.

http://www.nj.gov/oag/newsreleases09/pr20091110b.html

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