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Azadian Law Group
August 31, 2016

Azadian Law Group Reaches Settlement with Starbucks in Class Action over Price Switching

In another major win for California consumers, George S. Azadian and Ani Azadian have recently settled a price-switching class action case against Starbucks Corp. This case (Sarah Martin, et al. v. Starbucks Corp., et al., Case No. BC582335) alleged that Starbucks was overcharging customers for some breakfast sandwiches.

Preliminary approval for the settlement was granted by Los Angeles County Superior Court Judge Lisa Hart Cole on August 24, 2016.

Details of the Case

Filed in May 2015, this case alleged that Starbucks had been advertising two breakfast sandwiches at lower prices than it was charging in stores. Specifically, the allegations claimed that:

  • While Starbucks had advertised its reduced-fat turkey bacon breakfast sandwich for $3.45 and the sausage and cheddar breakfast sandwich for $3.25, stores were charging $3.75 and $3.45 (respectively) for these sandwiches.
  • These price switching tactics were being committed by at least seven Starbucks stores in Los Angeles County. Further investigation by the Azadian Law Group, however, revealed that this price switching was also occurring at various other Starbucks stores throughout California.
  • Starbucks’ deceptive pricing practices violated a number of laws, including (but not necessarily limited to) the:
    • Consumer Legal Remedies Act
    • False Advertising Law
    • Unfair Competition Law
  • The price differences, when totaled across the state, added up to hundreds of thousands of dollars.
  • Starbucks’ policy of asking whether customers want their receipts helped mask the alleged pricing differences.

The Settlement

According to the terms of the preliminary settlement, Starbucks will reportedly be refunding about $325,000 to customers who were overcharged for breakfast sandwiches in California locations (from April to August 2015). Each purchase of these sandwiches (in California over the specified timeframe) will result in a 25-cent refund to customers, with:

  • Customers who used a Starbucks rewards card to buy these sandwiches receiving their refunds automatically
  • Other customers being able to secure their refunds by providing proof of purchase.1

Additionally, the preliminary settlement provides:

  • $40,000 to pay for the administrative costs associated with paying out the settlement
  • $5,000 to the plaintiff who initiated the case
  • Attorneys’ fees.

Have Your Consumer Rights Been Violated? Contact a Los Angeles Consumer & Class Action Attorney at the Azadian Law Group, PC

If you have been the target of a business’ price switching tactics – or any corporate practice that violates your consumer rights, contact a Los Angeles consumer & class action attorney at the Azadian Law Group, PC for a free case to review to find out more about your options for recovery and justice.

You can call us at 626-449-4944 or send us an email via this contact form to find out more about your rights, your potential case, and how we can help you. If you choose to move forward with us, you will not have to pay us any legal fees until or unless compensation is secured for your case.

From offices based in Pasadena, our attorneys provide exceptional legal service and representation to people throughout Los Angeles County, Riverside County, San Bernardino County, San Diego County and the state of California.

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1: Instructions on how to file a claim for refund from Starbucks will be available soon.

Additional coverage of the Azadian Law Group’s win in this class action case is available here.

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