Class Action Lawsuit Says BJ’s Overcharges Tax on Discounted Items

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Class Action Lawsuit Says BJ’s Overcharges Tax on Discounted Items

By Anne Bucher

BJ’s Wholesale Club Inc. has been hit with a class action lawsuit accusing the retailer of charging sales tax on the full price of items even when customers used discount coupons, in violation of Pennsylvania law.

In their class action lawsuit, filed August 8, 2013, John Myers and Cecelia Reihl claim that they were repeatedly charged sales tax on the pre-discount price of items purchased with coupons, even though Pennsylvania law states that sales tax can only be applied to the discount price of an item.

“The extra money that BJ’s collects under color of law – 6 percent of the difference between the item’s full and discounted price – is not actually sales tax and does not have to be remitted to the state,” the BJ’s Wholesale Club class action lawsuit says.

The plaintiffs claim that they did not initially notice the higher tax on their first two purchases, but became aware of the issue when they purchased a television with a discount coupon. When they noticed that BJ’s had charged them sales tax based on the full price of the product rather than the discounted price, they cancelled their purchase. According to the class action lawsuit, the plaintiffs complained to the manager of the BJ’s store, who informed them that Pennsylvania law required the retailer to charge sales tax based on the full price of items purchased with coupons.

In their class action lawsuit, the plaintiffs allege that BJ’s follows this illegal practice at all 15 of its Pennsylvania retail locations. They believe that tens of thousands of BJ’s customers may be affected. 

“Because the potential class encompasses many thousands of claims, a single, state-wide class action is plainly more efficient than thousands of small claims law suits, each requiring the same discovery,” the plaintiffs say.  They believe that a class action lawsuit will “provide optimum compensation to Class Members for their injuries as well as deter the Defendant and other similar businesses from engaging in such wrongful conduct in the future.”

Because BJ’s is a membership club, the plaintiffs believe that the potential members of the class action lawsuit will be easy to track down using their BJ’s membership identification numbers. They claim that BJ’s violated both the Pennsylvania Unfair Trade Practices Law and the state’s Consumer Protection Law. They also claim that BJ’s engaged in unjust enrichment. They are seeking reimbursement in the amount of their sales tax overpayments. They are also seeking treble damages and attorneys’ fees. They have demanded a trial by jury.

The plaintiffs in the putative class action lawsuit are represented by George Bochetto of Bochetto & Lentz PC and William Wolk of Litigation Partners PL. 

The BJ’s Sales Tax Class Action Lawsuit is John G. Myers, et al. v. BJ’s Wholesale Club Inc., Case No. 130800546, in the Court of Common Pleas of Philadelphia County.

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