Rent-A-Center settles suit
By Furniture Today Staff -- Furniture Today, February 6, 2005
Plano, Texas — A California court has granted preliminary approval to a class-action settlement between Rent-A-Center and a group that challenged the rent-to-own operator's business practices in the state.
Rent-A-Center agreed to pay $37.5 million in cash to eligible customers who entered into rental-purchase agreements from Feb. 1, 1999, through Oct. 31, 2004.
The company also will issue vouchers to class members for two weeks free rental on new rental agreements. Rent-A-Center did not admit any wrongdoing.
The company took a pretax charge of $47 million in its third quarter to account for the settlement and attorneys' fees. The settlement stems from suits alleging various violations of California's Rental Purchase Act and Consumer Legal Remedies Act.
Rent-A-Center operates 2,878 company—owned stores nationwide and in Canada and Puerto Rico. Its ColorTyme subsidiary is a national franchisor of 308 RTO stores.
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