Business

Groupon lets customers in on $8.5-million lawsuit settlement

Groupon, Inc.Justice SystemBusinessCrime, Law and JusticeAndrew Mason

Groupon subscribers this week are getting an email from the daily deals site informing them that they might be eligible to get a chunk of a proposed $8.5 million settlement.

Last month, without admitting fault or wrongdoing, Groupon Inc. settled a class-action lawsuit that had taken issue with the company’s use of expiration dates.

Illegal and hidden restrictions on certain discounts and bargains included stipulations that the coupons be used up in one visit or within a too-small time frame, according to the lawsuit -- an amalgamation of 17 individual suits rolled into a unified filing and sent to California district court last year.

Anyone who bought a U.S. Groupon deal or was given one between Nov. 1, 2008 and Dec. 1, 2011 is eligible to make a claim. But the payout will likely be measured in pennies.

A sizable portion of the proposed $8.5-million disbursement -- which is set to go before a judge for approval in late June -- will go toward lawyers fees. Each of the original plaintiffs will get $500.

That leaves about $6.3 million to be split among tens of millions of potential claimants.

Those customers will also get a “settlement voucher” that can be redeemed with businesses for the purchase price of the unused deal. For example, a claimant who paid $20 to get $40 worth of a product or service will get a ticket for $20.

If merchants turn down the settlement vouchers, customers can get a refund check with 20% of the deal’s promotional value added on top.

The Chicago company has also agreed to make deals with expiration dates of less than 30 days 10% or less of its total deal volume over the next three years.

Groupon said this month that its first quarter revenue soared 89% from a year earlier. Chief Executive Andrew Mason has said that the company is “setting out to reinvent the multi-trillion-dollar local commerce ecosystem.”

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