Suzy Shier and Competition Bureau reach $1 million settlement over pricing practices
''When is a bargain really a bargain?'' Ordinary price claims case ends with $1 million settlement.
The Competition Bureau has reached a $1 million settlement with Suzy Shier Inc., over marketing practices the Bureau considered to be misleading. In a June 13, 2003 press release, the Bureau stated that Suzy Shier had placed price tags on garments indicating a "regular" and "sale" price even though the garments were not sold at the "regular" price in any significant quantity or for any reasonable period of time.
Raymond Pierce, Deputy Commissioner of Competition, explained in the release: "The issue boils down to one question: When is a bargain really a bargain? The Bureau is committed to ensuring that consumers have accurate information regarding the regular price of clothing so that they may determine the true value of their savings when deciding to purchase items on sale."
In its own statement, La Senza Corp., the then owner of Suzy Shier, stated that Suzy Shier "does not admit any conduct contrary to the Competition Act" but noted that, in recognition of the Bureau's concerns and of the importance of providing accurate information to consumers, Suzy Shier and the Bureau had agreed to file a civil consent agreement with the Competition Tribunal to resolve the matter.
According to the consent agreement, only 12.5% of Suzy Shier sales of the products at issue were made at the "regular" price during the evaluation period and the products were offered for sale at the "regular" price" for only approximately 11% of the time.
The $1 million administrative monetary penalty is the first under the Competition Act's civil "ordinary selling price" provisions, which came into force in 1999. The consent agreement also required Suzy Shier to publish corrective notices in newspapers across Canada and to implement a corporate compliance program to ensure that it meets the requirements of the Competition Act.
The announcement of the settlement was released just a few hours before La Senza Corp. announced that it was selling Suzy Shier to a division of YM Inc. The sale was completed on July 28, 2003. Neither La Senza Corp., nor YM Inc., is bound by the terms of the consent agreement, which applies only to Suzy Shier.
