“No late fees,” apparently doesn’t necessarily mean “no fees.” Blockbuster Video advertised their new “no late fees” program at length, only for customers to find out they automatically “purchased” videos or games they did not return within a set timeframe. Forty-eight states, including Florida, sued on the consumer’s behalf and won the lawsuit Tuesday.
According to a press release from Florida Attorney General Charlie Crist’s office Blockbuster will pay $630,000 for attorney fees and costs of litigation and agreed that it will not suggest or state in any way that there are no late fees or only limited late fees unless the “buy” option is clearly stated and customers are advised by store personnel upon signing the contract.
One might dismiss the case as a frivolous lawsuit and say, “Well, didn’t you read the fine print?” as agreements customers signed specified that if customers did not return the video or games they rented within seven days of the specified due date, they would be billed full price for it and the item was theirs to keep.
But the slogan was so blatantly misleading while the real agreement was hidden in fine print that customers had every right to complain, even if the terms where technically there. After all, if the slogan is “no late fees,” it would imply just that. If the slogan had claimed, “If you like it, just keep it and we’ll bill you” it would have been fair, but that was not the case.
The $630,000 will likely not hurt a corporation like Blockbuster, but the blemished image the company now has may add up to hurt them more as customers go elsewhere for their entertainment needs. In that regard, the lawsuit was effective.
Nevertheless, it should be hoped that such lawsuits can be avoided in the future. Not because customers, or states on the behalf of them, do not file such suits, but because corporations should be aware that no matter how big they are they can’t get away with such blatantly misleading practices.