Wednesday, October 1, 2014

$1.6M Lowe's 2×4 labeling settlement

A California Superior Court judge ordered Lowe's to pay $1.6 million over a lawsuit alleging the “unlawfully advertised structural dimensional building products for sale.”

Lowe's



The Lowe’s 2×4 labeling lawsuit was filed for California consumers by District Attorneys from 5 counties, and last month, Marin Superior Court judge Paul Haakenson gave final approval to a settlement by ordering big-box retailer Lowe's to pay $1.6 million over a lawsuit alleging the incorrect description of structural dimensional building products for sale, such as lumber. Under the terms of the settlement, Lowe's will have to correct the false, misleading, deceptive or inaccurate product descriptions from its 2x4s and other dimensional materials or take away the noncompliant materials from its shelves.

The class action lawsuit was brought by 5 district attorney’s offices located in Los Angeles, Marin, Monterey, San Joaquin and Stanislaus counties, alleging that Lowe’s sold structural dimension building products by incorrectly advertising the length, width, depth or thickness of building materials. The order, brought on as part of a civil consumer protection action, consists of 3 major rules for the retailer to follow going ahead.
  • “Popular or common product description,” such as the word 2×4 should be stated clearly as ‘commonly called,’ ‘popular name,’ or ‘popular description.’
  • “Common descriptions” should be followed by specific dimensions and marked as such. For example, a 2×4 should be followed with a disclaimer that the wood is really 1.5-inches by 3.5-inches and have a phrase the same or close to “actual dimensions.”
  • Dimension descriptions must have the “inch-pound unit,” which means they should contain abbreviations like “in., ft., or yd.,” and can’t use signs like ‘or’ to signify measurements.
Lowe’s spokeswoman Karen Cobb stated that the settlement would affect almost 100 Lowe’s stores in California. She further stated that better product signage and labeling is now on Lowes.com and in Lowe's advertising, and work is in progress to revise signage in California stores.

According to the judgment, the retailer has to pay $1.47 million in civil penalties and costs of the investigation, as well as another $150,000 for future consumer protection related activities, such as quality control and price verification programs carried out by the California Department of Food and Agriculture. According to the district attorney's office, the retailer was cooperative during the investigation and has already implemented enhanced policies and procedures to keep misleading or inaccurate product descriptions out of its advertisements.

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