Best Buy Coupon Fiasco: 3 Legal Lessons
You may have heard about the Best Buy coupon fiasco. And with the company now not honoring the coupons, you may be curious about the legal ramifications.
The electronics retailer recently offered an Internet coupon in a promotion: Get $50 off of your purchase of $100 or more if you pay with a Mastercard, reports The Huffington Post.
The coupon had some standard restrictions such as not applying to iPods and certain TV sets. But there were no restrictions on the number of coupons a customer could use, nor were there restrictions on using the coupons to purchase gift cards.
So bargain hunters were able to get Amazon gift cards and score other deals for a fraction of the actual retail price.
Someone at Best Buy obviously made a mistake, and a head or two will likely roll. But instead of honoring the Internet coupons, Best Buy has decided to reissue its coupon and change the promotion completely. Now the promotion is valid for only one day, for one purchase, and excludes all gift cards, writes HuffPo.
But can Best Buy do this? Can they simply renege on their coupon? Here are some legal issues to consider:
- FTC regulations. The Federal Trade Commission requires that businesses be honest and straightforward with their advertising. Deceptive and misleading penalties may violate the law and subject the company to penalties. However, there is question whether an honest mistake could be characterized as misleading or fraudulent.
- Potential Lanham Act violations. While the FTC enforces consumer protection laws on behalf of consumers, the Lanham Act allows business competitors to sue for false advertising. Again, it appears that Best Buy made an honest mistake and it's not clear if its competitors can sue for false advertising. In fact, Best Buy's competitors may be laughing at the losses the electronics company must have taken with its coupon.
- Read (and reread) your fine print. To avoid mistakes like the Best Buy coupon fiasco, business owners must carefully review every word on their coupon -- or better yet, get a lawyer to look it over. A simple typo or a forgotten word can mean the difference between an effective marketing tactic and financial doom for your company, especially if you're bound by the terms you mistakenly printed on your coupon.
If you have legal question about your marketing practices, you may want to contact a small business attorney to make sure your coupons or other promotions won't come back to haunt you.
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