Emily Sortor  |  May 20, 2020

Category: Consumer News

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1-800-Contacts Inc. has agreed to pay $15 million to resolve antitrust claims against them.

A 1-800 Contacts Inc. price-fixing class action lawsuit has ended in a $15.1 million settlement after four years of litigation.

Originally, consumers had filed their antitrust litigation against not only 1-800 Contacts Inc. but also against other retailers including Walgreens, Vision Direct, and Luxottica.

Walgreens and Vision Direct have already reached settlements with consumers, paying almost $35 million to shake off the antitrust claims.

Now, 1-800 Contacts proposed settlement will mark the end of the contact lens antitrust class action lawsuit, if the deal is approved.

1-800 Contacts Inc. does not admit any liability in the contact lens price-fixing class action lawsuit, but agreed to settle with customers to avoid the continued costs and risks of litigation.

Consumers agreed to settle for similar reasons, saying that the settlement “eliminates the continued expense and uncertainty of litigation against 1-800 in favor of immediate, substantial compensation for the settlement class.”

That “substantial compensation” from the 1-800 Contacts settlement will reportedly be combined with the previous contact lens antitrust settlements, forming a settlement fund of $40 million in total.

The proposed settlement asks the court to permit the funds to be distributed together and the consumers ask for a single notice program to be sent out to Class Members, as opposed to a separate notice program for each settlement. The customers assert that one notice program will be more efficient and easier to understand.

The terms of the 1-800 Contacts class action settlement stipulate that no funds shall be returned to 1-800 Contacts Inc. if they are not claimed. Additionally, any interest earned on the settlement fund will become part of the settlement.

This current settlement was reached after intense negotiations between the parties, explain the customers. They note that two rounds of negotiations failed, before the third round of negotiations yielded the current settlement.

The proposed Class of consumers are all those customers who made at least one online purchase of contact lenses from 1-800 Contacts between Jan. 1, 2004 and Sept. 12, 2019.

As the settlement will be combined with funds from other settlements reached with other companies accused of participating in the antitrust scheme, customers who purchased contact lenses from other companies are eligible for benefits from the settlement, if the settlement is approved.

 

As such, also included in the Class are those who purchased contact lenses from Vision Direct Inc., Walgreens Boots Alliance Inc., and Walgreen Co. between Jan. 1, 2004 and Sept. 12, 2019; those who purchased contact lessons from Arlington Contact Lens Service or National Vision Inc. between March 10, 2010 and Sept. 19, 2017; and those who made purchases from Luxottica of America Inc. from Dec. 23, 2013 to July 5, 2019. 

In their contact lens price-fixing class action lawsuit, customers argued that 1-800 Contacts Inc. and its competitors had reached an illegal agreement that they would not compete for internet search advertising.

1-800 Contacts Inc. allegedly conspired with other retailers to increase prices and force customers to see their ads.Allegedly, this agreement was reached after 1-800 Contacts had pursued litigation against its competitors for trying to use its trademarked phrases in search engine ads. The reported agreement that the competitors would not place ads using certain search terms was part of a trademark protection strategy.

According to customers, this agreement financially injured customers because it blocked them from seeing possibly lower-priced options for contact lenses, forcing them to buy higher-priced contacts from 1-800 Contacts.

Allegedly, this action effectively forced customers into making purchases at elevated 1-800 Contacts prices. The customers also claimed that, not only did this financially injure customers, but also violated antitrust law. They say that if the competition had been fair, they could have paid lower prices.

The Federal Trade Commission also reportedly challenged the alleged 1-800 Contacts prices antitrust issue and pursued litigation against the scheme.

In 2018, the regulator ruled that the company had indeed violated federal law. However, this did not mark the end of the FTC’s claims, as the company then appealed that decision. Now, the FTC claims against 1-800 contacts are still in the appeals process.

Do you buy contacts through 1-800 Contacts? Do you feel like it is a cost-effective option? Share your experiences in the comments below.

The customers are represented by Carl E. Goldfarb, Scott E. Grant, and Melissa Felder Zappala of Boies Schiller Flexner LLP; David W. MItchell, Brian O. O’Mara, and Steven M. Jodlowski of Robbins Geller Rudman & Dowd LLP; and Heather M. Sneddon and Jared Scott of Anderson & Karrenberg.

The 1-800 Contacts Prices Class Action Lawsuit is J. Thompson, et al. v. 1-800 Contacts Inc., et al., Case No. 2:16-cv-01183, in the U.S. District Court for the District of Utah.

UPDATE: July 2020, the 1-800 Contacts class action settlement is now open. Click here to file a claim.

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55 thoughts on1-800 Contacts Inc. Strikes $15M Deal With Customers

  1. Nikki Ann says:

    Got an email today reminding me to select which way I want to be paid. Never got the first one. But it said I was getting $175.15.

  2. DAVID MEYN says:

    ADD ME PLEASE

  3. annoyed says:

    This is for the people that continuously post “add me” in the comment section:

    1. This settlement is closed
    2. That isn’t how this works
    3. If you are capable of commenting “add me” then your capable of adding yourself.
    4. click file a claim if the settlement is still accepting claim.
    5. Have a great day :)

  4. Harry Potter says:

    one more thing, to the people commenting “add me” excessively in the comment section:

    1. This lawsuit is closed.
    2. If you are able to comment “add me” then you are fully capable of filing a claim yourself.
    3. Have a great day :)

  5. Harry Potter says:

    I got the email that asked how I wanted to receive payment and after setting it up with my bank account, still haven’t received any payment or even a confirmation email.

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