Personal Finance

Missouri attorney general sues Walgreen Co., alleging deceptive pricing

An undercover investigation of eight Walgreens stores in Missouri found a pattern of deceptive pricing that overcharged customers, the state’s attorney general said in a lawsuit filed Tuesday.

According to Attorney General Chris Koster, the national drugstore chain routinely charged higher prices at checkout than were on shelf or display price tags for the merchandise.

In the investigation, the practice occurred in 43 of 205 purchases, nearly 21 percent of purchases at the stores investigated in five Missouri cities, including Kansas City.

“This level of consumer deception is … appalling,” Koster said at a news conference in Kansas City.

His office on Tuesday filed a lawsuit against Walgreen Co. in Jackson County Circuit Court seeking financial penalties and an injunction to stop the practice. He said the alleged deceptive practices were statewide.

“Walgreens is going to fix the problem,” Koster said.

Walgreen Co. in a statement said it had a 112-year history of acting in its customers’ best interests and that would continue to be its focus. It added it was disappointed and disagreed with the attorney general’s comments.

“However, we are prepared to have a constructive dialogue about the issues he raised and address any appropriate concerns,” said James Graham, a spokesman for the company.

Koster said the investigation was triggered by complaints made to his office about Walgreens’ pricing that were so numerous they were “way off the chart” compared with other retailers.

The investigation found merchandise with posted sales prices that had expired or claims that purchasing more than one of a product would also be at the discounted price when it wasn’t at the checkout. Bins of merchandise that were supposed to be part of a clearance sale were instead sold at full price.

Many purchases simply allegedly failed to honor the stated price. Oreo cookies were on sale for $3.29 a package when the price charged at the checkout was $4.19. The amount of overcharges ranged from a few cents to $15 on the purchases, which were made in June and July.

Some sale prices had fine print that a coupon was required or the shopper had to be a member of the store’s reward club. In one purchase, even being a member of the reward program didn’t help get the discounted $6.69 price for Muscle Milk. The charge was $8.99, according to the investigation.

The undercover shoppers visited eight stores and found problems in seven of them.

Koster said he was seeking documents from Walgreen Co. to determine whether the problem was at the store, regional or national level. Walgreen has faced similar allegations in Wisconsin and in California, where a court monitor was assigned to ensure that Walgreen Co. resolved it.