November 26, 1999

Michigan Attorney General Jennifer Granholm has sued J.C. Penney Co. for consistently high error rates in its point-of-sale scanning systems.

"Clearly, 'buyer beware' will be the rule this holiday season.  Receipts are one set of lists consumers should be sure to check twice," Granholm said.

The suit charges that J.C. Penney's error rates were more than 33 percent at four stores -- compared with rates of 3 percent at Mervyn's and Kohl's.  A spokesman said the overwhelming majority of the errors were in the store's favor, not the consumer's.  

Granholm said the failure to post correct pricing information amounted to an unfair or deceptive commercial practice, thus violating the Michigan Consumer Protection Act. 

The suit asks the court to order J.C. Penney to adopt procedures to eliminate overcharges.  It also seeks fines of up to $25,000 per day and restitution for consumers. 

At one store the error rate was 61 percent, with 88 percent of the errors favoring the store, the spokesman said.  

The suit grew out of Granholm's 6th annual scanner accuracy survey, which included 19 retail stores throughout Michigan.  The survey found an overall scanner error rate of nearly 17 percent, with 85 percent of the errors being overcharges. 

"Overcharging customers certainly won't win you any customer service awards," Granholm said.  "Well-known, well-respected national retailers should care about their customers enough to ensure that they're getting the price advertised."

"Kohl's and Mervyn's should be applauded for not having overcharged a single customer in this year's survey," she said. 

Industry analysts said Wal-Mart, Jewel and Safeway also have good reputations for scanner accuracy, with Wal-Mart's error rate often below 0.5 percent. 

At Jewel, a shopper's purchase is free if it rings up erroneously.  

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