Rite Aid Must Pay Fine for False Advertising

UPDATED at 8 p.m. Oct. 10 with a statement from Rite Aid:

Rite Aid Corporation responded with the following statement today provided by company spokesman Eric Harkreader:

"Since being made aware of the investigation in the spring of 2011, Rite Aid has cooperated with San Diego City attorney and district attorneys. The complaint is not a finding or ruling that Rite Aid has actually violated the law. The stipulated final judgment is for settlement purposes only and does not constitute an admission by Rite Aid of any violation of the law. Rite Aid has agreed to comply with the terms of the stipulated final judgment."

ORIGINAL POST:

Rite Aid Corp. and its California subsidiary Thrifty PayLess Inc. will fork over $800,000 to settle a lawsuit filed by Riverside and surrounding counties alleging false advertising and other unlawful business practices by the chain, it was announced today.

Riverside County will receive $175,000 in penalties from Rite Aid, while the balance of the funds will be shared among the city and county of San Diego, as well as Santa Clara and Ventura counties.

Prosecutors in each of the locations handled the civil action, though the suit was filed in San Diego.

San Diego County Superior Court Judge Ronald Prager today certified the settlement.

According to the lawsuit, Rite Aid advertisements during an 18-month stretch conveyed to consumers that they would pay lower prices for items purchased using the Rite Aid Wellness-plus Card. The ads touted "It's like getting it for..." and "It's like paying ..."

However, once at the register, customers could not purchase the item at the advertised price. Instead, they got a coupon printed on the end of a receipt for discounts on a future purchase that would expire and was subject to other restrictions.

In the settlement, Rite Aid agreed to clearly display the limitations and all the conditions necessary for customers to purchase items for advertised prices.

Also, as part of the settlement, Rite Aid stores will institute a new system at customer credit card terminals in which the computer will prompt consumers when gift cards are below $10, and ask if the would like to redeem the card for cash.

Over a four-year span, Rite Aid refused to redeem low-balance cards for cash, according to the suit.

Prager ordered Rite Aid and Thrifty PayLess not to commit future violations.

There are 39 Rite Aid stores in Riverside County, at least two of which are located in Temecula.