Restocking Fees: Lawsuits

Seattle, WASome states are filing lawsuits against companies that illegally charge restocking fees. Texas Attorney General Greg Abbott filed a lawsuit against ASAP Motors claiming the company illegally charged restocking fees. According to court documents the defendant charged a restocking fee of 20 percent on items that were delivered either damaged or defective despite a company policy stating that the restocking fee applied only to non-defective returns.

The lawsuit also alleges ASAP Motors is guilty of "Failing to disclose all terms of the sales agreement, or of any refund policy orally and in writing to each consumer prior to purchase, including the specific terms and conditions of refunds, returns, and restocking fees."

Last year the state of Washington reached a settlement with CompuVest, a company that sells computers via the Internet, after the company was accused of misrepresenting its return policies. Under the settlement CompuVest will pay over $20,000 to resolve customer complaints and an additional $50,000 in civil penalties. According to Attorney General Rob McKenna, CompuVest did notify customers that there was a 15 percent restocking fee on merchandise that is returned but not defective. However, the company did not inform customers that it would test returned items and charge the restocking fee and shipping fees for any products it deemed operable. The suit claimed that because of this practice customers were charged restocking fees on defective items.

Also last year Washington State filed a lawsuit against PeoplePeople, an online-based company that sells cheese, candles, and posters. The lawsuit alleged PeoplePeople violated the state Consumer Protection Act in a number of ways including charging a 15 percent restocking fee for returned orders regardless of why the item was returned. "Consumers who returned broken goods, wrong merchandise, or items shipped long after the promised delivery date were still charged a restocking fee," according to the attorney general's press release.

Laws regarding restocking fees vary by state. If you are unsure about whether or not restocking fees are legal in your state, check out your attorney general's website for information.