SALT Report 3841 – A federal judge in Cleveland has allowed a class-action suit to move forward in a case that calls Walmart’s return policies into question.
The federal lawsuit filed in May names Ohio residents Shaun Brandewie and John Newbrough as plaintiffs. It accuses the mega-retailer of not issuing full refunds for products purchased in one county and returned in another.
Brandewie bought products at Walmarts and Sam’s Club stores in Cuyahoga County but returned them in Summit County. Newbrough purchased items at the Walmart on Steelyard Drive in Cleveland and returned them in Portage County.
Both plaintiffs did not receive the full refunds because the sales tax was higher in Cuyahoga County, and the stores in Summit and Portage counties used the local sales tax rates to calculate the refund, according to the lawsuit. Brandewie lost $0.84 after returning three products, while Newbrough lost $0.99.
Through this practice, Brandewie and Newbrough allege that Walmart owes more than $5 million in claims to people who have similar experiences — a hurdle for a class-action lawsuit to be filed.
Walmart denied the claims and asked U.S. District Judge James Gwin to dismiss the suit, saying the matter should be decided by the Ohio Tax Commissioner.
On Friday, Gwin ruled that the commissioner should not hear the case, since the commissioner would only resolve claims where the taxes were sent to the state. In this case, the plaintiffs allege that Walmart kept the taxes and did not pay them to the state.
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