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Attorney General Brown Announces Settlement with Wal-Mart to Give Customers $3 Back for Price Discrepancies at Cash Register

Monday, November 24, 2008
Contact: (415) 703-5837

SAN DIEGO—California Attorney General Edmund G. Brown Jr. and San Diego District Attorney Bonnie Dumanis today announced a settlement with Wal-Mart Stores, Inc. that will “help consumers as the holiday season approaches” by giving customers $3 back at the cash register for price-scanning errors.

“We found price-scanning errors in Wal-Mart stores across California,” Attorney General Brown said. “Consumers saw one price in the aisles, but were charged a higher price at the cash register. With this agreement, Wal-Mart will give customers $3 back when pricing mistakes are found at the cash register. In these tough times, this will help consumers as the holiday season approaches.”

In December 2005, the California Attorney General’s Office began an investigation into allegations that Wal-Mart stores in California were scanning items at a higher price than the prices advertised on store shelves and signs. Through random price-checking, county Departments of Weights and Measures across the state found that 164 Wal-Mart Stores in 30 counties had made scanning errors. On average, customers who were overcharged paid an extra $8.40 at the checkout.

Examples of price-scanning errors include:

• From late August to November 2006, customers were overcharged $1.00 on sports bras in Ventura, San Diego, Los Angeles, San Bernardino, Stanislaus, Siskiyou and Tuolumne Counties.
• In January and February 2007, customers were overcharged $2.00 for woven shirts in San Diego, Sacramento, Ventura, Los Angeles and San Bernardino Counties.
• In December 2007, customers were overcharged $2.00 on S/S Polo in San Diego County.
• In November 2003, customers were overcharged $5.16 on a Journey CD in Ventura and Los Angeles Counties.
• From December 2004 to February 2005, customers were overcharged $5.02 on Hanes underwear in Los Angeles County.
• In October and November 2006, customers were overcharged $2.00 on a pair of men’s pants in San Diego and Tuolumne Counties.
• In March and April 2006, customers were overcharged $1.00 on Kellogg’s Special K cereal in Los Angeles and Santa Clara Counties.
• Also in March and April 2006, customers were overcharged $.46 on Kellogg’s Rice Krispies cereal in Madera, King and Ventura Counties.

In the settlement agreement, Wal-Mart agreed to implement a pricing accuracy program in California for at least four years. The program will include:

• A designated person (or group of people) who will receive and address customer complaints from Wal-Mart stores in California.

• An employee (or group of employees) in every Wal-Mart Store who will scan items on a weekly basis and confirm price accuracy.

• An automatic refund program. Whenever an employee becomes aware that a customer has been or is being charged a price higher than the lowest price currently listed, Wal-Mart will give the customer a $3.00 reduction on the item. If the item is less than $3.00, the customer will receive that item for free.

• A sign, in English and Spanish, will be posted at every check-out stand in every Wal-Mart Store clearly outlining the new store refund policy.

In settlement of the case, Wal-Mart has agreed to pay $1.4 million in restitution, civil penalties and reimbursement for investigative costs, and $50,000 to the State Consumer Protection Prosecution Trust Fund.

The case is People vs. Wal-Mart, Inc, San Diego Superior Court case number 37200800096757-CU-BT-CTL. A copy of the Complaint and Settlement Agreement are attached.

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