NEWARK
— The State has reached a settlement
with Sleepy’s, Inc. and 1-800 Sleepy’s,
Inc. ("Sleepy’s") under
which Sleepy’s has agreed to comply
with New Jersey consumer protection laws,
make significant changes in its advertising
and business practices and follow specified
procedures to resolve existing and future
consumer complaints, the New
Jersey Division of Consumer Affairs
announced today.
As
part of the agreement, Sleepy’s
will provide $90,000 in restitution to
customers. The company also will pay the
State $660,000 to cover attorneys fees,
investigative costs and future initiatives
by the Division of Consumer Affairs. Sleepy’s
has worked cooperatively with the State
and has demonstrated a willingness to
institute the changes requested by Consumer
Affairs in order to resolve this matter.
Sleepy’s has made no admissions
of any wrongdoing or liability.
The
agreement resolves a lawsuit filed by
the Division of Consumer Affairs in February
alleging that Sleepy’s, among other
things, misled consumers regarding the
company’s exchange policy and the
right of consumers to receive a refund;
delivered defective or damaged merchandise
to consumers; failed to deliver merchandise
as promised; and made misleading representations
in advertisements. Sleepy’s promptly
responded to the State’s lawsuit
by implementing, among other things, changes
to its advertising.
"This
agreement will assist affected Sleepy’s
customers and ensure that meaningful changes
are made by the company to bring its business
practices into compliance with state law,"
said Deputy Attorney General Lorraine
K. Rak, Chief of the Consumer Fraud Prosecution
Section of the Division of Law. "It’s
a good resolution for New Jersey consumers."
To
resolve consumer complaints, Consumer
Affairs will notify existing complainants
within 40 days of the agreement that their
complaints have been forwarded to Sleepy’s,
that they should expect a response from
Sleepy’s within 30 days, and that
they have the right to refer their complaints
to Consumer Affairs’ Alternative
Dispute Resolution Unit ("ADR")
for binding arbitration, if Sleepy’s
disputes the consumer’s complaints
and/or requested relief.
In
addition, for a one-year period, Consumer
Affairs will forward to Sleepy’s
any complaint it receives against the
company. Sleepy’s must then provide
a response to the complainant within 45
days of its receipt of the complaint.
Consumers will have the right to refer
their complaints to ADR for binding arbitration
if Sleepy’s disputes their complaint
and/or requested relief.
Also,
under the terms of the agreement, in its
advertisements of merchandise, Sleepy’s
will, among other things:
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