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New Jersey sues Advance Auto, Pep Boys for overcharges
January 8, 2016 / 4:35 PM / in 2 years

New Jersey sues Advance Auto, Pep Boys for overcharges

(Reuters) - New Jersey sued Advance Auto Parts Inc and Pep Boys - Manny, Moe & Jack, accusing the auto parts and services retailers of fraudulently overcharging customers in their stores, the state’s acting attorney general said on Friday.

A Pep Boys auto parts store is shown in Encinitas, California December 8, 2015. REUTERS/Mike Blake

The state said inspections by its Division of Consumer Affairs showed that barcode scanners often scanned items such as oil filters and transmission fluid at prices higher than those posted, while prices for other goods were not posted at all.

New Jersey said that since April 2007, Advance Auto had violated a state “weights and measures” law intended to prevent overcharges at least 1,211 times, while Pep Boys had violated the law at least 86 times.

“For many consumers, a trip to the automotive parts store can be a confusing foray into unfamiliar territory,” Acting Attorney General John Hoffman said. “When retailers are not transparent and accurate in their pricing, consumers suffer.”

Pep Boys said it was “surprised” the complaint was filed, after it rebuffed what it called the state’s demand that it make “onerous” business changes and pay excessive fines. It also said it has been cooperating with New Jersey officials, and received no consumer complaints about its pricing.

Advance said it is committed to accurate pricing, and took “prompt action to correct any issues” following the inspections. It said it is trying to resolve the matter with the state.

The lawsuits filed last month seek civil penalties, a halt to further violations and legal fees and costs.

As of January 2015, Advance had 69 stores in New Jersey while Pep Boys had 43, the complaints said.

Roanoke, Virginia-based Advance has more than 5,200 stores nationwide and Philadelphia-based Pep Boys has more than 800, according to the companies’ respective websites.

Last month, Carl Icahn’s Icahn Enterprises LP won a bidding war for Pep Boys, agreeing to buy the company for about $1 billion.

The cases are Hoffman et al v. Pep Boys-Manny, Moe & Jack of Delaware Inc et al, Superior Court of New Jersey, Chancery Division, Essex County, No. C-277-15; and Hoffman et al v. Advance Stores Co et al in the same court, No. C-278-15.

Reporting by Jonathan Stempel in New York; Editing by Dan Grebler and David Gregorio

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