Walmart is currently under scrutiny as it faces a class-action lawsuit over alleged deceptive and unfair pricing practices on groceries, according to a ruling by a federal appeals court on July 3, 2024.
The lawsuit, brought forth by plaintiff Yoram Kahn, accuses the retail giant of exploiting consumers through small price discrepancies that collectively amount to “hundreds of millions of dollars each year.”as reported FOX8. Kahn contends that Walmart is knowingly engaging in these unfair practices, which he describes as both pervasive and continuous.
Kahn recounts his experience at a Walmart store in Niles, Illinois, on August 2, 2022. He relied on the marked prices on the shelves to make his purchasing decisions. However, when he went to check out, he scanned 15 items and later discovered that the prices of six of those items were marked up by 10 to 15 percent above the shelf prices.
- Walmart allegedly engages in deceptive pricing practices that result in small price discrepancies.
- These discrepancies are claimed to add up to significant amounts annually.
- Kahn’s specific incident involved a noticeable difference between shelf prices and register prices.
- The lawsuit asserts that Walmart is aware of these discrepancies and continues to allow them.
This class-action lawsuit highlights the importance of consumer awareness and the need for corporate accountability in retail practices. As the legal proceedings unfold, it will be crucial to watch how this case impacts both Walmart and consumer protection laws.
Altogether, Kahn paid Walmart $1.89 in overcharges on these six items, nearly seven percent of the pretax total of his bill,” the lawsuit claimed. “Small change for Kahn as an individual, no doubt, but keep in mind the volume of Walmart’s business.”
Walmart’s Response
A Walmart spokesperson recently gave the following explanation to Nexstar’s KNWA:
“We’ll always work to provide our customers everyday low prices they can count on. We are confident in the evidence and look forward to arguing our case.”
Legal Battle Timeline
This case was previously dismissed in March 2023 after a judge ruled that Walmart providing a receipt after purchase negated unfairness caused by the inaccuracies in shelf prices. However, the 7th U.S. Circuit Court of Appeals in Chicago recently reversed the lower court judge’s ruling and said customers could try to prove the company has used a “bait-and-switch” method that violates Illinois’ consumer protection laws.
Walmart’s Legal Troubles: A Recurring Theme
This isn’t the first time the company has faced legal problems regarding its pricing practices. Just in June, Walmart agreed to pay $1.64 million to settle claims in New Jersey over inconsistent unit pricing. This settlement was brought to light through a news release from New Jersey Attorney General Matthew J. Platkin.
New Jersey’s Findings
The New Jersey Division of Consumer Affairs conducted an investigation that revealed significant violations. According to a consent decree, 64 Walmart stores in the state failed to use a standard unit of measurement—such as quart, pound, or per 100 sheets—on groceries and other items. This lack of standardization led to confusion and potentially unfair pricing for consumers.
Walmart’s Digital Solution
In response to these issues, the company earlier this year announced plans to install digital shelf labels in nearly 2,300 stores by 2026. This innovative solution will allow employees to update prices through a mobile app, effectively eliminating the need to manually change paper tags.
The company believes this will streamline the process and ensure pricing accuracy. So, while the company continues to face legal challenges, it’s also taking proactive steps to improve its pricing practices and enhance the shopping experience for customers.
Key Takeaways
- A Texas man’s $100 million lawsuit against Walmart was dismissed by a judge.
- The company settled for $1.64 million with New Jersey over inconsistent unit pricing.
- New Jersey’s investigation found that 64 of the company’s stores violated unit pricing regulations.
- The company plans to install digital shelf labels in 2,300 stores by 2026 to ensure pricing accuracy.