Iowa has joined the Federal Trade Commission (FTC) and 19 other states in suing Dollar General Corp. The suit says the discount chain charged shoppers more at the register than the prices it showed on shelves, price tags and ads. Iowa Attorney General Brenna Bird announced the move on Monday, Oct. 26, in a release from her office. Radio Iowa reported Iowa's part in the case the same day.

The complaint was filed in the U.S. District Court for the Middle District of Tennessee, according to the FTC's release. The commission voted 2-0 to let its staff file it.

What the lawsuit says

According to the FTC's release, Dollar General has for years "repeatedly mislabeled prices, overcharged consumers and failed to correct the issue." The agency says the overcharges at the register added up to "millions of dollars" and involved thousands of stores. The company runs more than 21,000 stores, the FTC said. It also said Dollar General received "tens of thousands of complaints" from shoppers who were not charged the advertised price, and that the company knew about the problem but did not adequately fix it.

The FTC says the practices violate the FTC Act, the Gramm-Leach-Bliley Act and state laws. Bird's office said Iowa's claims are brought under the Iowa Consumer Fraud Act.

CBS News reported that the suit asks for a permanent injunction plus money and other relief. CBS News did not report a dollar amount.

The FTC release lists the states that joined: Alabama, Arizona, Arkansas, California, Connecticut, Florida, Illinois, Iowa, Kansas, Louisiana, Michigan, Mississippi, Nebraska, New Jersey, North Carolina, Ohio, Oklahoma, Tennessee, Utah and Wisconsin.

The FTC release says the commission files a complaint when it has "reason to believe" the law is being broken and that a case is in the public interest. It adds: "The case will be decided by the court." The claims have not been proven in court.

What it means in Iowa

Dollar General has nearly 350 stores in Iowa, Radio Iowa reported. The FTC release says the chain's low-priced household items are "critical to its low- and fixed-income customers who rely on the accuracy of Dollar General's pricing."

"When an Iowan goes into Dollar General, they should be able to trust they are paying the advertised price," Bird said in her office's release. The release says she joined the suit to hold the company accountable under Iowa law and to get relief for Iowans. It does not say how much money Iowans might get back or how they could file a claim.

Bird said it is "completely unacceptable that Dollar General has made millions" by overcharging customers, Radio Iowa reported.

Christopher Mufarrige, director of the FTC's Bureau of Consumer Protection, said in the agency's release that "Dollar General has betrayed the trust of millions of American consumers" and that the company has "imposed significant financial harm on communities and consumers who are already struggling to make their paychecks last."

Dollar General's response

Dollar General said it aims for shelf prices and register prices to match, CBS News reported. In the company's account, mismatches sometimes happen, store teams are told to make them right for customers, and it has improved how it checks prices. It said FTC staff demanded far more money than a realistic estimate of pricing errors would support and that it tried to resolve the matter without going to court. The company said it will "defend this litigation vigorously," CBS News reported.

In a statement to The Guardian, the company said "occasional price discrepancies" can happen and that it has improved its "price-accuracy processes," Radio Iowa reported.

About this story

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