*NEWS*STAPLES RESOLVES CLASS-ACTION SUIT

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Staples suit resolved by classy action
Chain distributes more vouchers than settlement required
October 2006 Staples Inc. gave its Massachusetts customers a nearly $73,000 bonus last month, handing out more shopping vouchers than it was required to under a class-action settlement.The office supply chain was supposed to hand out a maximum of 76,800 vouchers worth $7.50 apiece, or one for each of the first 1,200 shoppers at its 64 stores on Monday, Sept. 25.But demand was so high that the company decided to hand out vouchers to everyone who came in to its stores. Staples says it handed out 86,529 vouchers, 13 percent more than it had to and an average of 1,352 per store. The vouchers were worth a total of $648,967.The voucher settlement was a novel way of compensating Staples customers for the chain’s alleged failure to comply with a state regulation requiring it to mark prices on individual items in its stores.Class actions have come under attack in recent years for their reputation for high legal fees and minimal benefit to the customers allegedly wronged. Settlement funds in many cases have often gone to charities or been parceled out in the form of coupons that could only be redeemed by making an additional purchase.In the Staples case, the parties agreed that $7.50 vouchers would be handed out to customers visiting the chain’s Massachusetts stores on what the retailer dubbed “Consumer Day.” The vouchers could be used to purchase virtually anything in the store. No minimum purchase was required.Under terms of the settlement, Staples was required to select a Monday for the voucher giveaway on which historically at least 525 customers on average had made purchases at each of the chain’s Massachusetts stores.The final numbers indicate passenger traffic on Sept. 25 was 2.5 times the historical average. Neither party was allowed to advertise the voucher giveaway, but Staples was required to post signs about it in its stores.Sam Perkins , the lead plaintiffs’ attorney, who received $210,000 in legal fees as part of the settlement, said press coverage of the voucher giveaway as well as pass-along e-mails he sent to school boards, school superintendents, unions, and lawmakers helped build customer traffic.”I’m impressed,” he said. “Anything that gives something back to consumers in a seamless way is a good model for class actions.”Owen Davis , a spokesman for Staples, said the company decided to hand out more vouchers than it was required to because it didn’t want any customer to leave empty handed.Davis said he didn’t know how many customers who came into the chain’s stores on Sept. 25 ended up spending more than $7.50. “We were pleased with the response on that day,” he said.Colman Herman of Dorchester, the lead plaintiff in this case and a participant in several previous item-pricing cases with other retailers, said the voucher giveaway was far superior to previous settlements where retailers donated money to various charities.”This case was all about victims who were allegedly harmed,” he said. “The money got back into their pockets.”

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October 31, 2006 at 1:50 PM