STAPLES RESOLVES CLASS-ACTION LAWSUIT

[Anonymous]

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.”

[Author]

October 31, 2006 at 1:51 PM