Showing posts with label class action. Show all posts
Showing posts with label class action. Show all posts

Wednesday, September 11, 2013

Home Depot Faces Class Action Suit Filed by Accused Shoplifters

The tongue-in-cheek 1987 Smiths' song "Shoplifters of the World Unite" urges petty thieves to get their act together and take over the world. Some accused shoplifters in California may be taking that message to heart.

According to a class action complaint filed by lead plaintiff Mr. Jimin Chen in California Superior Court last week, Home Depot's Florida-based lawyers extorted millions of dollars in settlements from accused shoplifters, by fraudulently representing that the home improvement giant would press criminal charges and bring civil claims, without any intention of ever doing so.

Specifically, the lead plaintiff alleges that he and a friend were shopping at a local California Home Depot in early June.  Before Chen's $1,445.90 purchase of a large quantity of lumber, he and his friend casually put on a pair of $3.99 work gloves.  Before the purchase was rung up by cashiers, they removed the gloves and placed them on the top of the lumber.  The checkout personnel failed to scan the gloves.

After he paid for the lumber, but before he left the store, Chen alleges he was suddenly taken into custody by a Home Depot security guard who accused him of trying to shoplift the gloves.

Chen claims he suffered an asthma attack and was handcuffed and kept in custody for as much as 30 minutes.  The police were never called and no charges were filed.  Chen was asked by Home Depot's personnel to sign an agreement that would keep Chen from shopping at any Home Depot for 90 days. Chen signed the agreement and presumably was happy to oblige. The agreement also contained a general "notice" that purported to warn the accused thief that he might face further charges, or civil demands.

Soon after the incident, Chen received a formal letter from a Florida law firm, demanding payment of $350 as a civil settlement of possible ramifications from the incident within 20 days.  When he failed to respond, a follow-up letter from the lawyers allegedly upped the demand to $625.

Instead of paying, Chen filed the class action lawsuit.  Chen alleges that in 4 years, Home Depot hasn't sued a single person under California's anti-shoplifting law, which provides that merchants are entitled to recover the cost of stolen items, up to a total value of $500.

Rather, he alleges that Home Depot illegally created a "profit center" out of a scheme to defraud frightened customers/alleged shoplifters.

It is worth noting that there were no clear damages in Chen's incident, as the two pair of gloves were recovered before Chen left the store, in any event.  There is no clear indication why Home Depot would be entitled to any civil recovery from Chen, much less $625.

The suit further alleges that Home Depot and its lawyers were capitalizing on the fact that thousands of accused shoplifters would be terrified by the demand letters and would pay up, instead of facing a lawsuit and/or criminal prosecution.

It is also worth noting that it is a crime for someone to overtly threaten to file criminal charges in exchange for compensation. Home Depot's rights and remedies for attempted petit larceny were to press criminal charges.

Needless to say, the suit has created a public relations embarrassment for Home Depot, which has reportedly responded by saying that it disagrees that the "general practice of civil demands is unlawful."