California authorities said Thursday Safeway, Pleasanton, Calif., has agreed to pay $2.25 million in costs and fines to settle a civil complaint alleging it had engaged in false advertising and unfair competition and had defied a 2008 injunction.

Safeway officials could not be reached for comment.


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The complaint — filed by the district attorneys of several California counties, including Alameda, Fresno, Marin, Napa, Sacramento, Santa Cruz, Solano, Sonoma and Ventura — alleged that, over the last four years, Safeway had unlawfully charged consumers prices higher than its lowest advertised price; misrepresented the weight of Safeway-branded products; and made statements on in-store signs that gave the impression certain produce was locally grown when it actually came from sources in other countries.

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The complaint also alleged Safeway had failed to abide by provisions of a 2008 injunction requiring it to initiate and maintain a program to minimize pricing discrepancies by instituting a price-accuracy policy, including provisions to give consumers an item worth less than $5 for free if they were overcharged or to charge the correct price and give the consumer a $5 gift card if the item cost more than $5.

The complaint said Safeway failed to honor the requirement consistently and failed to adequately notify customers of the policy with signs at every checkstand.

Authorities also said Safeway agreed to take “significant measures” to increase price accuracy and to be bound by a permanent injunction prohibiting it from making false or misleading statements; charging an amount greater than the lowest price posted; failing to honor any valid Safeway coupons, discounts or offers; and failing to clearly and conspicuously disclose any inclusions, exceptions or limitations to any offers, coupons or discounts.

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