A complaint was filed on Aug., 12, 2010 in the Superior Court of New Jersey on behalf of a putative class of New Jersey residents alleging that Staples' "buy one get one free" offer violated the New Jersey Consumer Fraud Act and constituted common law fraud. The complaint alleged that Staples advertisements promised consumers that if they purchased one case of paper for $43.98, the second case would be free. However, the complaint alleges that under the terms of the offer, the consumer would actually pay for both cases of paper at $43.98 each, and within 4-6 weeks, the consumer would receive a prepaid credit card in the amount of $43.98, which the consumer could use at locations accepting VISA cards. The plaintiff claimed that Staples artificially elevated the price of the first case of paper and also recouped its cost on the purportedly "free" second case of paper by retaining for weeks, if not months, the interest on what was essentially a loan from the consumer in the amount of $43.98, and from non-use and expiration of the cards without redemption.

Tip: Companies should not increase the price of an "item" being sold as part of a free offer in order to recoup the price of the free item. Companies should also endeavor to promptly ship any promised refund to consumers.