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Whole Foods to Pay $800,000 for Pricing Violations After Santa Monica Files Suit

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By Daniel Larios
Staff Writer

June 25, 2014 -- If you were shocked by your Whole Foods bill recently, it may be due to more than the store's notoriously high prices. You may have been one of the customers overcharged at a store that has earned the nickname "Whole Paycheck."

On Tuesday, Whole Foods Markets settled a lawsuit that would have the company pay nearly $800,000 in penalties after a statewide investigation uncovered widespread pricing inaccuracies in stores all across California, including the three in Santa Monica.

The Santa Monica City Attorney, along with City Attorneys from Los Angeles and San Diego, brought the civil consumer protection case on behalf of the People of California in a Santa Monica courthouse of the LA County Superior Court.

The case grew out of a more than one-year investigation by state and county Weights and Measures inspectors throughout California, according to Santa Monica Deputy City Attorney Adam Radinsky.

Inspectors found that Whole Foods, which specializes in organic and all natural food, was charging more than the advertised price for a wide variety of food items.

The problems included failing to deduct the weight of containers when ringing up charges for self-serve foods at the salad bar and hot bar; giving less weight than the amount stated on the label for packaged items sold by the pound; and selling items by the piece instead of by the pound as required by law.

"Consumers have a right to accurate pricing, and the right to pay for only what they bought," said Radinsky, who is in charge of the office's Consumer Protection Unit.

"By adding the weight of containers and packaging, especially on higher-priced, per-pound items like seafood and meats and even prepared food, the extra charges can add up fast, and yet be hidden from consumers."

Whole Foods released a statement after the judgment stating that it cooperated with the city attorneys to ensure "accuracy and transparency in everything we do" and that the company "takes our obligations to our customers very seriously."

"We cooperated with the city attorneys throughout the process, and based on a review of our own records and a sampling of inspection reports from various city and county inspectors throughout California, our pricing on weighed and measured items was accurate 98 percent of the time," said Marci Frumkin, spokesperson for Whole Foods.

Frumkin added, "While we realize that human error is always possible, we will continue to refine and implement additional processes to minimize such errors going forward."

Whole Foods Market California, Inc. and Mrs. Gooch's Natural Foods Markets, Inc., which controls Northern and Southern California markets respectively, are bound by the terms of the judgment, which also includes a five-year injunction on all 74 stores in California.
Under the agreed court order, Whole Foods is required to "appoint two 'state coordinators' to oversee pricing accuracy at Whole Foods stores throughout California and designate an employee at every store in the state who will be responsible to assure pricing accuracy throughout the store."

The injunction also orders that Whole Foods "conduct random audits at each of its stores, four times per year, to assure that all prices are accurate and that proper weight is being deducted for all containers, and charge accurate prices and provide the advertised weight on all items."

As part of the court judgment, the companies will also pay $798,394 in penalties and costs.

This includes $630,000 in civil penalties, $100,000 paid to a statewide weights and measures enforcement trust fund and $68,394 in investigative costs.
"We hope this case will serve as a wake-up call to supermarkets and other food retailers to make sure their per-pound charges are accurate," Radinsky said. "Consumers should always pay close attention to their purchases and make sure that the store deducts the weight of all packaging and containers."

There are three Whole Foods in Santa Monica: one on 5th Street and Wilshire Boulevard, one on Montana Avenue, and one on 23rd Street and Wilshire.

The Austin-based supermarket chain operates more than 380 stores in the U.S., Canada and United Kingdom and had nearly $13 billion in sales in 2013, according to the company’s website.

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