How much do you charge your customers? Be careful. Don’t make Whole Foods’ mistake and overcharge or you might run into legal trouble.

Whole Foods is currently in damage control mode after it was investigated by several cities for pricing irregularities and overcharging customers. Now the company must pay $800,000 in fines and implement new pricing measures.

In California, an investigation of Whole Foods found that the retailer “routinely” overcharged its customers.

Investigators found several common violations, such as:

  • Food weighed less than the label advertised.
  • The weight of a container was not deducted from the price.
  • Prepared food items were sold by the piece instead of by weight, as required by law.
  • Items were charged the same price despite some weighing more and some weighing less.

Because of these violations, the city attorneys of Santa Monica, Los Angeles, and San Diego all sued the company for false advertising and unfair competition in violation of consumer protection laws.

In New York, the New York City Department of Consumer Affairs also declared that is was conducting a similar investigation of Whole Foods.

Steps You Should Take

For Whole Foods, $800,000 may be chump change. However, your small business probably cannot afford to be fined that much money. To avoid an investigation for overcharging your customers, you should:

  • Calibrate and maintain your scales regularly.
  • Remember to deduct the weight of packaging and containers from the price of products.
  • Train your employees on properly measuring and labeling products.
  • Conduct random checks to ensure quality.

If you ever find yourself in Whole Foods’ position, consult with an experienced business attorney for help.

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Related Resources:

  • Browse Business and Commercial Lawyers by Location (FindLaw’s Lawyer Directory)
  • Whole Foods Is Sorry It Systematically Lied About Some of Its Prices (Slate)
  • Clean Up on Aisle 10: Is Ralphs Cheating Customers? (FindLaw’s Law and Daily Life)
  • 3 Things to Know Before You Sell Homemade Goods (FindLaw’s Free Enterprise)

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