NORWALK - Sears and Kmart have agreed to pay $1.1 million to settle a civil lawsuit alleging the retailers engaged in dishonest business practices that caused customers to overpay for items advertised for less.Kmart was additionally accused of charging more for California Redemption Value (CRV) beverage containers than allowed by law. In some cases, Kmart charged the CRV fee for containers not covered under state law, investigators said. "These retailers are established, trusted household names. When consumers set foot in their stores, they have a reasonable expectation to receive fair and lawful prices," District Attorney Steve Cooley said in a statement. "A company that engages in deceptive advertising to bait consumers or deliberately overcharges customers will be sued to assure compliance with the law." Stuart Lytton, a deputy district attorney with the Consumer Protection Division, said both companies agreed to the settlement without admitting liability. Sears and Kmart, whose principal companies are based in Hoffman Estates, Ill., agreed to pay civil penalties and legal costs incurred by prosecutors and investigators. Under the terms of the stipulated judgment, the companies also agreed to not make false or misleading statements to the public with respect to the price of items advertised for sale. The companies must maintain compliance programs for three years to enhance pricing accuracy and correct pricing errors. Sears and Kmart will be required to conduct in-store audits no less than once a week and will be subject to independent, third-party audits at least once a year, prosecutors said. The civil action stems from an investigation into pricing and scanning practices that revealed that Sears and Kmart charged more than their advertised prices. Kmart was also found to be violating state laws in regards to the CRV program.

********** Published: July 22, 2010 - Volume 9 - Issue 14