Groupon has agreed to pay $8.5 million to settle a class-action lawsuit alleging that expiration dates and other restrictions on the company’s vouchers violated federal and state law, and unfairly prevented consumers from receiving products and services purchased through the daily deals service.

Notifications of the settlement were emailed to affected Groupon customers this week. More information is available on this settlement website.

The settlement involves Groupon deals from retailers including Nordstrom. A lawsuit filed last year against Groupon and Nordstrom was rolled up with similar suits from around the country, ultimately resulting in the settlement.

Groupon admitted no wrongdoing as part of the settlement. Groupon has agreed to change its sales and marketing practices to keep most Groupon vouchers from expiring for three years after the settlement is finalized.

The original suit against Groupon and Nordstrom alleged that the expiration dates were part of a strategy to maximize profits to the companies by making it harder for Groupon customers to redeem the deals they bought.

“Groupon and its retail partners, including Nordstrom, bank on the fact that consumers often will not manage to redeem ‘groupon’ gift certificates before the limited expiration period — therefore, many consumers are left with nothing, despite already having paid for the particular service or product,” the suit alleged.

[Thanks to Dan for the tip.]

Comments

  • Not

    Unless the expriation date changed then this should’ve been thrown out of court. I use groupon all the time and am happy with the service. Every item says when it expires right on the details page. Its part of their business plan. Maybe there is something I dont know but this sounds like bs.

    Boy, groupon should be paying me. But hey, I bought a item around that timeframe so maybe they will. ;)

  • Jeffrey Goates

    From the article describing the original lawsuit: “California Civil Code prohibits the sale and issuance of gift certificates with expiration dates”
    If California prohibits the sale of gift certificates with expiration dates and Groupon is selling gift certificates to Nordstrom stores in CA with expiration dates, that’s where the lawsuit is coming from.   It’s illegal and the customers should be compensated for it.  

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