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Hobby Lobby agrees to pay penalties to settle charges

Rochester Business Journal
June 12, 2014

Hobby Lobby Stores Inc. has agreed to pay $223,600 in penalties and offer free merchandise to more than 600 New York schools to settle deceptive advertising charges, state Attorney General Eric Schneiderman said Thursday.

With 108 schools eligible to claim free school supplies from the retail chain, Monroe County is the settlement’s second-largest beneficiary. Erie County has 177 schools that can claim free supplies. Five Wayne County schools are also eligible.   

In addition to handing 689 schools in 17 counties $138,600 worth of gift cards, Hobby Lobby agreed to pay $85,000 in civil penalties.

In sales promotions, the chain claimed to offer 30 percent to 50 percent off custom framing, furniture and home decor products. But the discounts were offered as part of sales that ran continuously for more than a year.

That put Hobby Lobby on the wrong side of a state law that puts time limits on sales. The measure is meant to keep retailers from disguising regular prices as special discounts.  

“Ultimately,” Schneiderman said, “a permanent sale is no sale at all.”

The settlement followed an investigation that began last year. The investigation and prosecution were handled by the attorney general’s Rochester office.
 
 (c) 2014 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or e-mail service@rbj.net.
 



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