Price Chopper to change advertising, pay fine for misleading customers with coupons

Price Chopper will change the way it advertises and promotes its coupons in New York and pay a $100,000 penalty following a settlement with the state.

State Attorney General Eric Schneiderman reached an agreement with the grocery store chain following complaints about misleading coupons issued by Price Chopper that failed to disclose restrictions.

The changes to the grocer's advertising practices will help shoppers make informed decisions about purchases. "In the current economy, it is more important than ever that consumers be presented with clear information about the terms and conditions of coupons and other sale offers," said Attorney General Schneiderman. "Price Chopper used deceptive business practices to mislead price-conscious consumers and extract hard-earned money from them by hindering their ability to shop competitively and save on groceries. Today's agreement ensures that consumers will be protected from misleading advertising at these stores in the future."

The investigation revealed that Price Chopper advertised that it accepted double coupons at its stores without disclosing important restrictions that applied to that policy.

After implementing a corporate-wide policy that limited the doubling of coupons "up to 99 cents," Price Chopper failed to disclose this restriction in its advertisements leading consumers to believe that $1.00 coupons would be doubled. Prior to this policy, Price Chopper's double coupon policies had previously varied from store to store. A number of stores doubled coupons up to $1.00 whereas others restricted the face value of coupons that could be doubled.

Schneiderman says restrictions on double coupons, which can make a significant difference in savings, must be clear to consumers who shop on a budget. In just April and May of 2012, Price Chopper shoppers redeemed 34,616,602 coupons valued at $.99 or greater; approximately 8 million of these were valued at $1.00 or more.

Under the terms of the agreement announced today, Price Chopper is required to clearly and conspicuously disclose any face value limits on coupon redemption. In addition to changing advertising practices, Price Chopper agreed to pay $100,000 in civil penalties and costs to the State.

For its part, Price Chopper says the information the Attorney General released is false, misleading and inaccurate. The company issued the following statement to CNYCentral:

â??We were appalled and disappointed by the inflammatory press release distributed earlier today by the NY OAG, as its portrayal of Price Chopperâ??s conduct is false, misleading and inaccurate in significant respects, and is not supported by the Assurance of Discontinuance (AOD) to which Price Chopper agreed. In fact, contrary to the Press Release, the AOD makes no assertion that Price Chopper acted intentionally to harm consumers or that its practices caused any losses, let alone millions of lost savings to its customers. Weâ??ve been in direct contact with the OAG to express our concerns and are awaiting their response.

What the NY OAG actually asserts in the AOD is that Price Chopper inconsistently denoted in its advertising the dollar value limit of its double coupon policy during select weeks in June 2011, January 2012 and April 2012 in Syracuse and Cortland, NY. Our decision to sign this agreement was reached after considering the likely cost of alternative actions, and because settling the matter will allow us to focus on serving our customers, including offering double coupons up to $.99 in all 130 of our stores.â??

Price Chopper has 79 stores statewide, including locations in Syracuse, Utica and the North Country.