Hobby Lobby settles advertising claims with N.Y. AG

ROCHESTER, N.Y. (Legal Newsline) - New York Attorney General Eric Schneiderman announced a $220,000 settlement on Thursday with the retail chain Hobby Lobby Stores Inc. to resolve allegations of deceptive advertising practices.

Hobby Lobby allegedly misled consumers into thinking they were receiving significant discounts through deceptive advertising over a two-year period. In 2013, Schneiderman's office began tracking marketing materials that advertised 50 percent off and 30 percent off sales.

The retail chain allegedly advertised its customer framing, furniture and home decor products as sale items for more than 52 consecutive weeks. Never-ending sales are considered a violation of New York's General Business Law for False Advertising.

"When companies mislead customers by advertising never-ending sales, our office will hold them accountable," Schneiderman said. "Ultimately, a permanent sale is no sale at all."

Under the terms of the settlement, Hobby Lobby agreed to change its advertising practices over the next 60 days. The store, which is a major seller of school supplies, will also give approximately 700 schools a total of $138,600 in gift cards for supplies. Hobby Lobby will provide gift cards to more than 100 schools each in Onondaga, Monroe and Erie.

Hobby Lobby also agreed to pay $85,000 in civil penalties and other costs.