Justinian C. Lane, Esq.
Let Justice Be Done, Though the Heavens May Fall

Justinian Lane's Blog

Justinian's Blog

Gift Card Lawsuits on the Rise

I had no idea that merchants charge fees if you don’t use your gift card within 12 months, or refuse to let you use small sums of money on gift cards:

Gift cards may seem like a hassle-free present, but they are triggering legal headaches across the nation.

In New Jersey, a man is suing Foot Locker Inc. over its gift-card dormancy fee, claiming that the extra fees that are charged if the card isn't used within 12 months violate state consumer protection laws. Vona v. Foot Locker, No. 3:08cv5003 (D.N.J.).

In Delaware, a federal bankruptcy judge recently approved a class-certification request from a Sharper Image Corp. gift-card holder, who claims the now-defunct retailer hasn't honored an estimated $19 million worth of unused gift cards for potentially thousands of consumers.

Source: Gift cards redeem legal problems throughout U.S.

Big business complains that class action lawsuits like this lead to ridiculous settlements in which consumers get coupons that are worth next to nothing.  I see two alternatives: First, businesses could stop screwing consumers, which would preclude the need for these lawsuits.  Second, thousands of individual consumers could file lawsuits over 2 dollars in damages.  That’s not very likely though, now is it?  Of course, if that happened, the same businesses would complain that frivolous lawsuits are clogging the courts.