Within hours that a Hartford Superior Court trial was to start, Best Buy and Connecticut Attorney General Richard Blumenthal have agreed to settle out of court. The settlement must still be approved by Superior Court Judge Marshall K. Berger, Jr.
Blumenthal in 2007 sued Best Buy based on allegation I disclosed in my Watchdog column at The Courant that the largest electronics retailer in the country was deceiving customers by using a secret in-store computer network that was identical to the public one but had different prices.
Blumenthal will disclose the settlement publicly this afternoon or tomorrow, if and when the judge approves it. The same judge is hearing my wrongful discharge case against The Courant which I brought after The Courant fired me in August 2009 for refusing to be nice to major advertisers.
It is believed that the settlement involves the payment of a fine and restitution to customers who were cheated.
Best Buy officials did not respond to a request for a comment today.
When Blumenthal launched his suit in March 2007 he and state Consumer Protection Commissioner Jerry Farrell Jr. said they expected it would result in millions of dollars in penalties and refunds. It is doubtful, however, that the settlement against the Minnesota based chain is that high. It is believed that the settlement only involves Connecticut while the Internet scam was used throughout the country.
At the time Farrell said he and Blumenthal offered to settle the case for several million dollars, but Best Buy, insisting it did not do anything to warrant such punishment, refused the offer.
The suit was filed after a Feb. 9, 2007 Watchdog column disclosed that Best Buy stores had a secret intranet site in its stores — one that mirrored the public BestBuy.com Internet site, but with different pricing. The intranet prices usually reflected the individual store’s prices, not the public Internet prices, which Best Buy since 2005 has promised to honor.
An East Hartford teacher, Eric Hammer of Torrington, tipped me off about the possibility of the dual Internet sites after his experiences at Best Buy stores.
Hundreds of Best Buy customers later complained to me about being charged higher-than-advertised prices on the public Internet site.
They said they looked up sales on bestbuy.com, but when they went into stores, clerks would show them a bestbuy.com site that had a price other than the sales price. Customers were told that the sale apparently was over, or that they had misread the advertisement.
In reality, the salesman was accessing an intranet website that was almost identical to the public site. According to current and former employees and managers, some workers knew they were misleading customers, while other employees were unaware of the duplicate site.
Best Buy officials have denied that the in-store intranet site was devised to confuse employees or customers. At the time they said the intranet site was set up only to let people know what was available in the stores, not to deceive customers. Only a small percentage of customers were adversely affected, they said.
“Once this issue was brought to our attention, we provided immediate training for our employees to help ensure that all customers received the best price. We are in the process of making changes to eliminate future confusion” company spokeswoman Susan Busch said in a prepared release then.
“Further details about this matter must be saved for courtroom; however, I can tell you that we intend to vigorously defend ourselves. The future of our company depends on our ability to build trusted relationships with our customers. Our goal is to provide our customers with the products and services that best meet their individual needs.”
Blumenthal said at the time that he did not buy the company’s explanation and that he expects other states to file their own lawsuits against Best Buy or join his suit.
“Best Buy gave consumers the worst deal: a bait-and-switch-plus scheme luring consumers into stores with promised online discounts, only to charge higher in-store prices,” he said. “Best Buy treated its customers like suckers, not patrons to be prized.”
Farrell added, “It is extremely unfortunate that this company misled consumers as to what the `best buy’ actually was.”
I was in the Newington, CT Best Buy two days before Thanksgiving reseaching TVs. I wanted additional technical information on some products and was speaking with an associate. She suggested that I download an app to my iphone which would help me get the information that I was looking for. I started to download the app and noticed it was taking a while. I then realized I was not connected to the store’s wifi network. I asked the associate “how do I log on to the wifi?” She said that “we don’t have public wifi because it would mess up the geek squad.” I asked her if she listened to what just came out of her mouth. I repeated her response “You are telling me that the ‘Geek Squad’ cannot figure out how to set up a separate public wifi network that has a firewall between their secure network, is that what you are telling me? Why should ANYONE trust that the Geek Squad could fix their technical problems if they can’t solve this simple issue?” I then recalled this situation and left the store.
I like Best Buy’s spin on the situation.
Not very contrite are they?
It’s time for people to realize they are crooks and move to another store.
Pretty rotten scam. How could they not know the prices were diferent?