Following a $14 million Costco Wholesale Corporation class-action settlement, certain consumers who received promotional emails from the retailer are eligible to claim cash payouts.
Costco denied any wrongdoing and maintains that it complied with the law, all while agreeing to the Aaland v. Costco Wholesale Corporation legal settlement, according to court documents.
However, a payout will not be sent automatically. Washington state shoppers must submit a claim form attesting that they received the emails and were Washington residents at the time.
The agreement does not specify the amount of money each Washington state Costco shopper can expect to receive because it depends on the number who file valid claims.
The agreement also states that an estimated $4.6 million, or 33 percent of the $14 million settlement, is set aside for attorneys’ fees and costs.
The settlement stems from allegations that Costco sent marketing emails with subject headlines that created a misleading and false sense of urgency.
The lawsuit alleges that the email subject heading promoted limited-time deals when, in actuality, the discounts would be accessible beyond the advertised deadlines.
Phrases included "Today is the last day to access Member-Only Savings" and "Hot Buys available for 5 Days Only."
To receive a lump sum, eligible shoppers must submit a valid claim form during the official claims period attesting to their eligibility.
The deadline to submit a consumer claim is Aug. 24.
Costco Wholesale Corporation’s public financial filings, including its SEC Form 10-K and earnings releases, show that Costco reported more than $8 billion in net income, which is $22.18 million per day.
A caveat of the settlement is that Costco counsel has the right to terminate the agreement if more than 250 class members choose to opt out.
When submitting a claim, shoppers can choose their preferred payment method. Options will include direct digital payments via Venmo, PayPal, Zelle, or a virtual prepaid card, as well as a traditional physical check.
Unclaimed funds or uncashed settlement checks will eventually be donated to the Legal Foundation of Washington.
A final hearing for court approval is set for Oct. 2. The professional legal services firm, Verita, was appointed as the settlement administrator.
"Settlement Administration shall occur under the Court’s supervision," the document states. "The costs of Settlement Administration (including, but not limited to, the costs of Class Notice, claims processing, and making the calculations, payments and distributions required under this Settlement) shall be paid by Costco. The Settlement Administrator shall administer the settlement. The Settlement Administrator shall provide wiring instructions."