Vons, Safeway, Albertsons stores had their finger on the scale, suit alleged
Grocery titan Albertsonshas been painting a rosy picture of how much money consumers will save if its proposed merger with Kroger is approved but a just-settled lawsuit isn't helping its argument.
The company agreed to pay $3.9 million to resolve a complaint that it ripped off customers at hundreds of its Vons, Safeway and Albertsons stores in California.
According to the complaint, groceries sold by Albertsons Cos. including produce, meats, baked goods and other items had less product in the package than indicated on the label. The company also is accused of charging customers prices higher than its lowest advertised price.
False advertising preys on consumers, who are already facing rising costs, and unfairly disadvantages companies that play by the rules, District Attorney George Gascn said. This kind of corporate conduct is especially egregious when it comes to essential groceries, as Californians rely on accurate advertised prices to budget food for their families.
Some items sold by weight such as produce, meats, baked goods and other items had less product in the package than was displayed on the package label. For those items, a grocer may only charge for the products actual weight; the packaging is not included in the overall weight.
LADAs Consumer Protection Division, in partnership with the consumer protection units of the district attorneys offices of Marin, Alameda, Sonoma, Riverside, San Diego, and Ventura counties, investigated and prosecuted this matter. The case was filed in Marin County Superior Court.
Price accuracy
The judgement requires the grocers to implement a Price Accuracy Program, including a Price Accuracy Guarantee that allows a consumer to be compensated up to $5 if they are overcharged. The program is an incentive to encourage consumers to report false advertising to the store as soon as it is discovered.
The company did not admit wrongdoing. It said ithas taken steps to correct the violations.
Albertsons Companies, Safeway Inc., and The Vons Companies operate 589 stores in California.
Merger challenged
The Federal Trade Commission (FTC) and eight states have sued to block the merger between Kroger and Albertsons. The case is being heard in federal court in Portland, Ore. .
The two supermarket companies say the merger will streamline operations and lower prices. In fact, Kroger has promised the merger would allow the combined companies to cut grocery prices by $1 billion.
Consumer advocates are highly skeptical. And while arguments are being made in the courtroom, plenty of arguments are being voiced outside the chamber. And not all concerns are about prices.
This merger will leave Californians with fewer choices over where to shop and for workers in this industry, where to work, said California Attorney General Rob Bonta. We are in court today to prevent this unlawful attempt by Kroger and Albertsons to merge their operations and reduce competition in the marketplace.
Photo Credit: Consumer Affairs News Department Images
Posted: 2024-10-04 15:39:34
