The New Jersey Division of Consumer Affairs and Apple have agreed that the tech giant will install continuously available pricing information for iPhones, iPads, MacBooks, Apple Watches and other devices on sale in Apple Stores in the state.
Attorney General Christopher Porrino announced the settlement on Tuesday.
The settlement calls for 4-and-a-half-inch by 3-and-a-half-inch “pricing wedges” to be placed on each table where these devices are displayed for sale, to contain the total selling price. The pricing wedges will supplement Apple’s existing in-store digital pricing system, which provides price information through apps and notifications that are launched from the devices themselves, Porrino said.
The division alleged that Apple’s in-store digital pricing system violated the state’s consumer protection laws because the pricing information was not continuously available for customers to view, making it necessary at times for customers to interact with a device or a sales representative to find how much the product costs.
“As phone prices rise, it’s more important than ever that consumers are able to easily compare prices between different models and make educated decisions on how to spend their money,” Porrino said in a statement. “This settlement ensures that all Apple Store shoppers, even those unfamiliar with how to use the electronic devices, can easily determine how much an item costs without having to seek assistance from a salesperson.”
Added the division’s acting director, Sharon M. Joyce: “We welcome innovative marketing concepts in the retail industry as long as stores comply with the laws in place to protect consumers, especially when they’re shopping for expensive items like smartphones and computers.”
The settlement resolves allegations stemming from the division’s inspection of all 12 Apple stores in New Jersey last year, the statement said.
Investigators from the division’s Office of Consumer Protection found that while accessories and other items in Apple stores were marked with traditional price tags, the iPhones, iPods, iPads, iMacs, MacBooks and Apple Watches on display for customers to view and use were only priced digitally.
The New Jersey merchandise pricing statute, a part of the Consumer Fraud Act, requires prices to be plainly marked with a stamp, label or sign on or near the merchandise. The purpose of the law is to ensure that consumers know the price of an item as they look at it—and are not required to interact with the device or a sales representative.
The division alleged that Apple was in violation of these laws because the pricing information on display devices was not continuously visible to customers.
The division also alleged that iPhones, iPods, and iPads had a “pricing screen” that stayed up for five seconds after the device was woken from sleep mode, but many devices did not display the “pricing screen” when approached because the device was already in an active state, rather than sleep mode.
Investigators also found that iMac desktop computers and Macbook laptops had a static “price wallpaper,” but many of the devices were running screensavers or applications that obscured the pricing, the statement said. Apple Watches had “pricing tablets” located on a separate table, not necessarily near the tables containing the display watches, the statement said.
During the inspections, the division also found that none of the Apple Stores in New Jersey were in compliance with the Refund Policy Disclosure Act, which requires that a retailer’s refund policy be posted in at least one of the following locations: attached to the merchandise itself; attached to each cash register or point of sale, in a place where it is clearly visible to the buyer from the cash register; or posted at each store entrance used by the public.
Apple, which eliminated in-store cash registers years ago in favor of hand-held devices that allow employees to transact sales from anywhere in its stores, has agreed to prominently display its refund policy on signs located at the public entrances to its stores, the statement said.
Deputy Attorney General Russell Smith Jr. of the Consumer Fraud Prosecution Section within the Division of Law represented the state.
Brittany Sokoloff of the New York office of Schiff Hardin represented Apple. She was not available for comment.