The Pennsylvania attorney general’s office has announced that Walmart is settling a class action lawsuit over its coupon policies. The lawsuit claims that Walmart incorrectly charged customers for sales tax on products that they didn’t pay for and should have deducted coupons before computing the sales tax. The Pennsylvania law requires retailers to deduct coupons before computing sales tax, and customers were not properly deducted for these discounts. In addition to a settlement, Walmart will provide records for customers to use to verify their coupon status.
Thomas used 4,572 counterfeit coupons in 451 separate transactions
Thomas spent nearly three months at Walmart using 4,572 counterfeit coupons, using over 1,000 coupons in total. He was able to purchase more than $22,000 worth of merchandise in just 13 visits. His complaint details how he used many coupons at once, often paying as little as one cent per transaction. In the end, he made more than one thousand dollars in profit. And the best part? He walked away with a lot of merchandise.
The police said Thomas used 4,572 counterfeit Walmart coupons in four51 separate transactions, ranging from household cleaning supplies to name-brand laundry detergent. The patterns of her behavior were similar to those of organized retail theft. They appeared in resale marketplaces. In a subsequent investigation, the police arrested Thomas and charged her with felony theft. The charges were dropped, but Thomas is now banned from shopping at the local Walmart. He is also required to pay full price for purchases, including Kool-Aid packets and pine tree air fresheners.
Walmart says it violated Pennsylvania’s tax code by failing to deduct the value of coupons from sales price before computing sales tax
A lawsuit claims that Walmart’s failure to deduct the value of coupons from the selling price before computing sales tax violated the tax code of Pennsylvania. As a result, Walmart owes a 1% discount on the sales price of items purchased with coupons. The case is still ongoing, but Walmart has agreed to pay anywhere from $21.5 million to $45 million. The amount each class member will receive depends on the number of valid claims filed.
According to the lawsuit, Walmart violated Pennsylvania’s tax code by failing, in the state of Pennsylvania, to deduct the value of coupons from the sale price before computing the sales taxes on those items. The state is considering whether to dismiss the case, based on its findings. In the meantime, Wal-Mart has urged Pennsylvania tax officials to review the case.
Allegations of overcharging customers
A lawsuit claiming that Walmart is overcharging customers with coupons is the latest example of a legal problem at a retail chain. A lawsuit filed by a Penn Hills college student alleges that the company is overcharging its customers for purchases made with coupons. Brian Farneth bought two cans of shaving gel at Walmart in O’Hara Township and presented a coupon for an additional 42 cents off the regular price.
While the FTC initially filed the lawsuit under Section 13(b) of the FTC Act, the court ruled in 2021 that the FTC had misused the authority that Congress had given them to pursue monetary remedies against a company. Congress did not give the FTC the authority to threaten companies with millions of dollars in monetary damages, which is what the lawsuit claims. Still, a Section 13(b) lawsuit can be successful if Walmart’s actions violate federal laws.
Settlement with Walmart
The company has agreed to pay out nearly $4 million to settle several employee class action lawsuits, including allegations that employees were not paid for overtime, meal breaks, or rest breaks. These claims were based on the fact that Walmart did not follow state labor laws. The company was also fined an incredible amount of money for violations of the law. This settlement is just the latest in a long line of payouts made by large corporations. But it may not be the end of Walmart’s legal troubles.
In one such case, a 51-year-old woman was injured while shopping at a Walmart. She slipped on water that leaked from a mini-refrigerator. She suffered leg and ankle fractures and was left permanently dependent on a feeding tube. Her attorneys found that Walmart violated internal rules about store safety. In addition, she had a long history of similar falls at different Walmart stores. After filing a lawsuit, Walmart agreed to pay her a confidential amount.
