Walgreens Settles Pricing Lawsuit for $1.4 Million

The retailer agreed to terms after being sued by district attorneys in four Northern California counties.

Walgreens will pay $1.4 million for overcharging consumers by failing, on multiple occasions, to make sure prices on its store shelves matched the prices charged at the cash register.  The settlement was announced today in a release sent by the Santa Clara District Attorney’s office.

The lawsuit was brought by the Santa Clara County District Attorney’s Office along with top prosecutors in San Mateo, Contra Costa and Santa Cruz counties,

According to Martha Donohoe, a Deputy District Attorney in the Consumer Protection Unit of the Santa Clara County District Attorney’s office, the money will be split between the four counties that originally brought the suit and Weights and Measures departments in 27 locales that helped in the investigation.  The counties will use their shares to fund consumer protection activities and the weights and measures departments will use theirs to recoup the costs of the investigation.

The company, which has 625 stores in California, also had been advertising discounted prices for using “Register Reward” coupons without clearly disclosing that the coupons required another purchase in order to benefit from the savings.   

Santa Clara District Attorney Jeff Rosen said: “Consumers have a right to expect that products will be accurately priced.  They should be protected from careless or intentional pricing errors. Our office brings actions such as this to assure that merchants have policies and procedures in place to fulfill their obligations to sell merchandise at the advertised prices.”  

As a result of the lawsuit, Walgreens within 60 days will offer a Scanner Price Guarantee to compensate consumers who find price discrepancies at the time of check out. If a consumer notifies the cashier that the price rung up is more than the lowest advertised price for an item, the consumer will receive either a $5 deduction or a $5 merchandise card. If the item is under $5, the customer can have the item for free. The terms of the Scanner Price Guarantee will be posted in every Walgreens store in California.   

“We are fully committed to fair pricing, accurate scanning, fully informing our shoppers and giving our customers the products they want at competitive prices,” said Walgreens spokesman Jim Graham in an email.  “This agreement underscores our commitment to our customers and to providing the best shopping experience. As the district attorneys stated, we cooperated with their inquiry and did not admit any wrongdoing. Previously, California district attorneys had worked with other retailers to arrive at agreements similar to the one we have reached with them.”

Walgreens did not admit wrongdoing in this case. The company cooperated with prosecutors during the investigation. The case was investigated by state and local Department of Weights and Measures offices, which conduct regular inspections of scanners in retail establishments statewide. 

The Santa Clara District Attorney’s Office reminds consumers to always check receipts to verify that they are charged the correct price for an item. Consumers in Santa Clara County who are the victim of a price overcharge should call the Scanner Hotline toll free at 1-866-SCANNER (722-6637).  Consumers outside Santa Clara who want to report a problem can call (408)  918-4601.

Tell us in the comments: Is $1.4 million an appropriate settlement? 

Dianne L Nowak January 10, 2013 at 04:06 PM
This doesn't surprise me as I've all ways said Walgreens prices were high compare to CVS.
Doofus January 10, 2013 at 05:57 PM
Now let's look at Safeway for the same infractions


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