N.J. Electronics Manufacturer to Modify Rebate Practices

October 20, 2004

New York Attorney General Eliot Spitzer announced a settlement with New Jersey-based Samsung Electronics America Inc. that requires the company to fulfill more than 4,100 manufacturer rebate claims that were wrongfully denied. Pursuant to the settlement, eligible consumers will receive a total of more than $200,000.

Samsung offers rebates to consumers who purchase electronic merchandise manufactured by the company. For each product, the rebate is limited to one per household. After a rebate is issued to a consumer, any subsequent rebate form submitted by a member of the same household is denied on the basis of “Maximum Number of Requests Exceeded.”

However, Samsung’s rebate program reportedly failed to recognize that many consumers live in apartment buildings and other multiple unit dwellings where they share the same address with other residents. Once Samsung issued a rebate to a consumer who lived at a particular address, any rebate form submitted by another consumer with the same address was denied – even if the consumer resided in a different apartment and was a member of a different household. As a result, more than 4,100 consumers across the nation who were eligible for a rebate reportedly received a denial notification.

Pursuant the settlement, the wrongfully-denied rebates range from $10 to $150 in value, will now be fulfilled. In addition, Samsung has agreed to implement procedures to ensure that rebate claims submitted by consumers who live in multiple dwellings are no longer denied unless the consumers actually reside in the same apartment or are members of the same household.

“Manufacturer rebates can provide significant discounts on consumer products. However, Samsung’s rebate program, which restricted payment to the first consumer at a particular address to file a claim, was unfair to the millions of consumers who reside in multiple dwellings. This settlement will ensure that eligible consumers who reside in multiple dwellings can receive their rebates from the company,” Spitzer said.

Out of the total to be refunded nationwide, $200,740, there will be $26,590 going to 530 New York consumers who were denied rebates. The Company will also pay the State $50,000 to cover the cost of the investigation.

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