Merchants are not happy...Are the buyers?


A Groupon happens between a Merchant and Buyers. - No Merchant! No Groupon!

1. Merchants Loose?
75% off existing Selling Price didn`t make sense, but inflating the price does. Caveat Emptor!

2. Buyers Loose?
Multi State Class Action Lawsuits accuse Groupon of selling gift certificates with short expiration dates.

3. Investors Loose?
If Groupon comes apart before the IPO, is it worth doing an IPO?

Friday, March 11, 2011

Is Groupon upsetting the Buyers?

Class action filed against Groupon alleging unlawful expiration dates

The following post is a copy from the Blog of the Legal Times, an affiliate of the Daily Business Review.

A class action was filed yesterday in U.S. District Court for the District of Columbia accusing Groupon Inc. of placing unlawful expiration dates on its gift certificates.
The Web site, which has headquarters in Chicago and an office in Palo Alto, Calif., works with businesses in cities across the United States and around the world to offer consumers discounted rates on goods and services, from restaurant meals and flowers to hot air balloon rides. The company sells these “Daily Deals” online.

The class – represented by Charles LaDuca of Washington’s Cuneo Gilbert & LaDuca – alleges Groupon violates federal laws governing electronic sales by placing expiration dates of less than five years on these “Daily Deals,” which the suit classifies as gift certificates. In a phone interview, LaDuca noted that similar class actions are pending in Illinois, Minnesota, California and Florida federal courts.

“There are a lot of angry consumers across America on this issue,” he said.

The suit also alleges that Groupon “preys on unsuspecting consumers” by requiring users to agree to “boilerplate” terms and conditions that include a class action wavier. LaDuca said that in addition to claims for damages, the class is seeking a court order requiring Groupon to change its practices.
Groupon, through a spokeswoman, declined to comment, citing the pending litigation. The company did not have an attorney listed for the Washington suit as of this morning, nor did it have representation listed yet for most of the class actions filed this year in other states.

The suit was filed on behalf of a Washington man who claims he bought a $20 Groupon for a one-month gym membership worth $305, only to have it expire before he could redeem it two months later. The complaint quotes anonymous Web-based comments from other Groupon users expressing frustration with the expiration dates.

This story was first published in the Blog of the Legal Times, an affiliate of the Daily Business Review.

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