July 23, 2002

District Attorney Nola Tedesco Foulston announces today that her office has concluded an ongoing consumer investigation of the Kohl’s Department Stores, Inc. (Kohl’s) and that as a result of the District Attorney’s findings; a second consent judgment has been entered in the District Court for Sedgwick County. The Journal Entry of Consent Judgment, approved by Judge Richard Ballinger, was filed on July 18^th, 2002 with the Clerk of the District Court in Wichita. 

For the second time in just over a year, the District Attorney’s Office commenced investigative review of consumer practices of Kohl’s that has now resulted in a second consent judgment under the Kansas Consumer Protection Act. In December of 2000, the District Attorney and the Kansas Attorney General had alleged breach of consumer laws in the sales practices of Kohl’s. At that time, Kohl’s agreed to a consent judgment including civil penalties, fees and costs. As is the policy of District Attorney Nola Tedesco Foulston to assure full compliance with Kansas Consumer Law, continuing review of the sales practices of Kohl’s was undertaken after the first consent judgment. 

As an important function of its office, the District Attorney regularly reviews and critically analyzes the sales practices of merchants within this jurisdiction who are providing goods to the consumers of this community.  In applying the proscribed laws as set forth in the Kansas Consumer Protection Act, the District Attorney is charged with special responsibilities to assure that companies comply with fair business practices as set forth in Kansas law.  One of the areas of particular concern is the advertisement of goods as “REDUCED” or “SALES" prices that have the effect of inducing consumers to buy goods because they believe they are getting a better price than that which the products may be regularly offered in stores on a consistent basis. 

The Kansas Consumer Protection Act provides specifically in Kansas Statutes Annotated 50-626(a) and (b)(7) that merchants shall not make misleading representations when making price comparison to the merchant's own price or a competitor’s price.  This law, as interpreted by the District Attorney, requires that in order for a business to advertise certain products to the consuming public as “SALE” items, those items must have been maintained in  the inventory of the merchant at the regular price for a sufficient period of time to be in compliance with the law. 

A regular review of Kohl’s print advertisements was conducted and site visits to the two (2) Kohl’s retail stores located in Wichita were undertaken for the purpose of investigating, inspecting and reviewing whether Kohl’s maintained compliance with the Kansas Consumer Protection Act in their advertising, pricing and signage at the stores including the labeling of store products at “SALE” prices.   The District Attorney’s investigators found that many items designated by brightly colored signs as being on periodic “SALE” were in fact labeled as such for a for a majority of the time.

 In accord with the District Attorney’s ongoing investigation, Kohl's was required to provide specific pricing information on certain items that were offered to the public for the period of February 15, 2001 through and including June 15, 2001. The District Attorney’s review of the investigative information included displayed regular price, the displayed sale price (if any), the actual point-of-sale price and number of units sold at these prices for each day during the relevant period. 

Upon review of all the information concerning pricing and sales practices obtained from Kohl’s during the investigation, the District Attorney found that some of the sixty seven (67) items from their store that were reviewed were offered on "SALE" in comparison to a reference price, when in fact, such items were not being sold and/or offered for sale at the stated reference price for a sufficient period of time between February 15, 2001 and June 15, 2001 in violation of K.S.A. 50-626(a) and (b)(7) of the Kansas Consumer Protection Act. 

A consent judgment of the type entered with Kohl’s is a legal mechanism where a party agrees not to dispute the claims made by the District Attorney in her pleadings filed with the court and without admitting to these allegations, the matter is resolved in many instances to avoid the costs and uncertainties of litigation.