Groupon Inc. is dealing with an additional class-action lawsuit associated to regardless of whether its offers need to be subject to state laws regulating gift cards, this time around on behalf of the Riverside resident who bought a Nordstrom Rack voucher in 2010.
The complaint had been filed in Kane County Circuit Court by St. Charles law firms Foote, Meyers, Mielke & Flowers LLC and Chavez Law Firm. Based on the filing, Adam Dremak of Riverside spent $25 on a Groupon in November 2010 of which gave him $50 off at Nordstrom Rack. The actual promotion expired Dec. 31, 2010, and that he failed to redeem the voucher before then.
The lawsuit contends that Groupons really should be classified as gift certificates. Under the Illinois Consumer Fraud and Deceptive Business Practices Act, gift certificates should not be sold or perhaps issued if they have an expiration date within five years of issuance.
“Consumers buy the gift certificates and become subject to the onerous sales conditions imposed by Groupon, including illegal expiration terms, which are relatively short, often just a few months,” the complaint stated. “Groupon and its retail partners reap a substantial windfall from the sale of gift certificates that are not redeemed before expiration, which is precisely the type of harmful business conduct that the Illinois State Legislature intended to prohibit.”
Groupon, which is likely to hold a preliminary public offering, revealed a week ago in a regulatory filing that it and several merchant partners face much more than 15 class-action suits associated to the issue of whether or not its vouchers are gift cards. In some instances, laws prohibit gift cards from expiring. Connecticut Atty. Gen. George Jepsen said a week ago he was considering the issue as well.
Groupon spokeswoman Julie Mossler mentioned Thursday that the company does not discuss lawsuit. The company has noted during the past that though promotional pricing on Groupon vouchers really does expire, consumers who buy the Groupons can redeem them for face value after that date. For instance, someone who purchased the $25 Nordstrom Rack voucher this past year could have redeemed it for $25, rather than $50, after December 31.
Within last week’s regulatory filing, Groupon stated it “intends to defend these actions vigorously.”
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