Topic:
CONSUMER PROTECTION; RETAIL TRADE; ADVERTISING; REBATES;
Location:
CONSUMER PROTECTION-UNFAIR TRADE PRACTICES; RETAIL TRADE;

OLR Research Report


October 3, 2005

 

2005-R-0736

HONORING STORE COUPONS

By: Daniel Duffy, Principal Analyst

You asked if retailers could refuse to honor their own store coupons advertising reduced prices if the coupons had not expired.

SUMMARY

The Connecticut Unfair Trade Practices Act prohibits deceptive acts in the conduct of trade or in commerce. Failing to honor an advertised price reduction apparently violates this prohibition.

The law authorizes the Department of Consumer Protection to enforce the prohibitions and establishes a wide range of penalties.

SELLING AT THE ADVERTISED PRICE

The Connecticut Unfair Trade Practices Act (CUTPA) prohibits, among other things, deceptive acts or practices in the conduct of a trade or in commerce (CGS 42-110b(a)). The terms “trade” and “commerce” are defined in a way that includes advertising, the offering for sale, and the sale of commodities (CGS 42-110a(4)).

The statute authorizes consumer protection commissioner to adopt regulations establishing acts or practices that are deemed unfair or deceptive in violation of CGS 42-110b. These are known as “per se CUTPA violations.” One such regulation prohibits failing to make the advertised item conspicuously and readily available for sale at or below the advertised price (Regs. Conn. State Agencies 42-110b-18(i)).

Failing to honor a valid advertised reduced price apparently violates both statute and regulation.

ENFORCEMENT

CUTPA authorizes The Department of Consumer Protection (DCP) to enter and investigate any establishment at reasonable times, (2) check invoices and records, (3) have access to and copy documents, (4) execute investigative demands, and (5) take certain other investigatory actions.

If the commissioner has reason to believe that someone has violated CUTPA, he may conduct a hearing after giving a notice that states the charges. Testimony must be taken under oath. The commissioner has the power to issue subpoenas to compel the appearance of witnesses or the production of documents (CGS 42-110d).

PENALTIES

If after the hearing, the commissioner concludes that a violation has occurred, he must state in writing his findings of fact and issue a cease and desist order. In cases involving less than $5,000, he may also order restitution. The commissioner may also enter into consent agreements and ask the attorney general to seek judicial enforcement of his orders (CGS 420110d, 42-110m, and 42-110n). The commissioner's order may be appealed to the Superior Court in accordance with the Uniform Administrative Procedure Act (CGS 42-110e).

Courts may issue restraining orders; award actual and punitive damages, costs, and reasonable attorneys fees; and impose civil penalties of up to $5,000 for willful violations and $25,000 for violation of a restraining order (CGS 42-110d, 42-110k, 42-110m, and 42-110o).

Someone who has suffered an ascertainable loss of money or property, real or personal, because of a CUTPA violation may sue to recover actual damages (CGS 42-110g).

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