James Delahunty
19 Feb 2005 4:53
Movie rental giant Blockbuster has been hit by a fraud lawsuit in New Jersey. New Jersey Attorney General Peter Harvey sued Blockbuster Inc. Friday, claiming the video rental chain is deceiving customers with its new "No More Late Fees" rental policy. Blockbuster is accused of violating the states consumer fraud laws with its new policy. "Blockbuster boldly announced its 'No More Late Fees' policy, but has not told customers about the big fees they are charged if they keep videos or games for more than a week after they are due," the attorney general said.
"There is no question about it, there is a violation of New Jersey's consumer fraud act," he added. Under the new policy consumers can keep a movie for a week over its due return date but after that, a consumer would be charged a restocking fee of $1.25. If a consumer keeps a rented movie for more than 30 days after its due return date, then Blockbuster will charge the consumer the full retail price of the item.
"The fact is there are no longer late fees at Blockbuster," the company said. "We're disappointed he took this action, because we believe our end-of-late fees program is a terrific program and we've received tremendous feedback from both our customers and employees." The company was surprised that he did not even try to contact them to get an explanation of the new policy first. The Attorney General said that investigation began as soon as the policy was implemented. "Our principal goal is restitution to the consumer," he said.
Source:
CNN