The Wall Street Journal has an interesting article about retailers who hire law firms to engage in something called “civil recovery,” in which alleged shoplifters are harassed into paying thousands of dollars… even if the case against them has been dropped, or the retailer never intended to sue at all.
From the WSJ:
After Miami handyman Glenn Rudge was accused of shoplifting an $8 set of drill bits at Home Depot, he thought he’d settled the matter when he showed his receipt to prosecutors and they dropped the charge.
But a few weeks later, a law firm hired by Home Depot began sending him letters demanding first $3,000, then a total of $6,000, implying he’d be sued if he didn’t pay it.
In an escalating battle against theft, retailers are going after anyone suspected of shoplifting, turning over their names to lawyers and collection firms, who pursue the suspects for stiff penalties and split the take with the retailer.”
The WSJ says this process is a result of laws passed in all 50 states that were intended to help retailers cover the cost of securing their stores, but the way the laws were written has resulted in some strange behavior by retailers.
Lord & Taylor, for instance, never follows up civil-demand letters by suing suspected shoplifters, its loss-prevention manager said in deposition about a year ago, citing the cost of going to court. Lord & Taylor collected about $1 million in civil recovery from suspected shoplifters in a recent year, up from $850,000 the year before, the official testified.
The chain’s letters to suspected shoplifters are sent out by a Florida law firm called Palmer Reifler & Associates, which also handles the task for four dozen other clients, from Wal-Mart Stores Inc. to Walgreen Co., keeping 13% to 30% of what it collects. A partner at the law firm has said that it sends out about 1.2 million civil-recovery demand letters a year but follows up by suing fewer than 10 times a year.
Creepy. In the Home Depot case, the handyman purchased the drill bits on a previous trip to the store, and had them peeking out of his shirt pocket. A security guard spotted them and pulled him aside.
After he kept insisting he was innocent, the guard handcuffed him, walked him to an interrogation room in back and took the drill bits. Mr. Rudge asked to call home to have his wife bring in the receipt but the store wouldn’t let him, he said in a 2003 suit in Miami-Dade County Circuit Court, since settled. Home Depot declined to discuss specifics of his account.Prosecutors charged the handyman with shoplifting, then dropped the charge in February 2003 when he showed them a receipt for the drill bits. But about a month later, according to his suit, he got a letter from the Palmer Reifler law firm demanding he pay a little over $3,000 within 20 days.
He ignored the demand. Then he got a letter demanding an additional $3,000, as “pre-litigation” attorney’s fees, for a total of just over $6,000. If he didn’t pay, one letter said, the sheriff’s office would be called to notify him if a lawsuit was filed.
Mr. Rudge was doing some handyman work for a lawyer and showed her the letters. “I took one look and said, ‘This is outrageous,’ ” says the lawyer, Alison Harke. “These letters are designed to make people settle because they believe they are going to jail.” She filed a suit against the retailer, the settlement of which is confidential.
We hope Barnes & Noble and Borders don’t do this. We’re always walking around with a book in our bag and when we find ourselves in book stores we start getting paranoid that the booksellers may have x-ray vision and a cynical outlook.
Big Retail Chains Dun Mere Suspects in Theft [Wall Street Journal](Thanks, Joseph !)
(Photo:Maulleigh)
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@Buran: NOT actually concealing it.
@Crazytree: As usual, I’m telling the truth and other people don’t like it so they badmouth me. Just because my experiences are different than yours, and I remember posts discussing these very issues, with rather-informed participants, recount them, and you don’t remember, that makes me an idiot and a liar?
I don’t think so.
Oh and I’m not a guy. I guess it’s STILL not sinking into brains that are only capable of spouting snark.
You guys should be careful, Loss Prevention is a different animal than it was years ago. Store security have far more power than the average citizen – remember that they are a representative of a private entity on private property. Like you in your own home. If they have reasonable justification (NOT probable cause – that’s for cops – people who are monitored by the state) to detain you, they, in fact, can get away with MORE than the Police. No Miranda Rights, no double-locking of handcuffs, no equitable treatment, nothing.
If LP can articulate intent on your part, threat from you during detainment, then you are pretty much boned. That internet tough guy second amendment crap is screwed too – if they had cause to detain you, and you fight them, guess what? Resisting a merchant with violence, felony.
Oh and you don’t have to conceal an item to shoplift it. You don’t even have to leave the store (if you break off a sensor tag, you have shoplifted. Defeating an anti-theft device with a tool is a felony in both Texas and Florida). Those 5-step rules (see them enter, see them select, see them conceal, maintain constant surveillance, see them exit) are for successful SL apprehensions – industry standards, as it were, intended to minimize civil liability. Most state theft laws simply expect a reasonable person to see that there was intent to not pay for an item.
Not to scare anyone – sympathy to you if you were mistakenly apprehended and treated cruelly without cause. Sue them. But to all you out there who think that a store has no power, I hope you are on the up and up.
@Buran: What you think is concealed or not might not be what the cops, the security gaurd/store employee, a judge and previous cases might consider concealed. Also, some states have statutes where insteada of conceal, they say “place upon their person” or in their clothing. Again, consult State statures for both legal definitions and possible annotations.
@rhombopteryx:
I’m perfectly clear on the fact that going after a shoplifter is legal. My question was really to the…I’ll call it “extortion” angle of this. Now, I’m not sure what the law school definition of extortion is, but that’s exactly what this smells like to me.
If you’re going to prosecute a shoplifter, it would seem that it would have to be done through the legal system, and by that, I don’t mean a crackpot law firm sending…well…extortion letters. File a criminal complaint.
Obviously, IANAL, so I could be way off base. The letters demanding cash just don’t seem legal.
@MPHinPgh: So, what you’d prefer is that the courts get tied up with minor shoplifting disputes while the taxpayers foot the bill?
If two people have an issue and they can settle it between themselves without involving the government, more power to them.
@DeeJayQueue: I thought I was the only one who felt like this. I’m also of the type of person who goes to stores for specific things and when they don’t carry it/are out of stock I often walk out empty handed. Even when they do have things in stock, I’m usually only buying a couple of items when everyone else around me is buying cartloads.
The more I hear/read about this, the more shopping entirely online sounds better. Oh, if only FreshDirect would ship to my place in FL as well as Manhattan — I’d be set.
@TinyBug: You’re entirely correct about good customer service. Unfortunately good customer service is on the endangered species list. I do wonder how much good customer service costs vs. all of the money spent on security cameras, loss prevention technologies, and rent-a-cops. People have always been dishonest. The decline of customer service and rise in the police state mentality is a recent development.
@Primate:
I think that part varies by state. Some were mentioning that some states they have to see you walk in the store w/o “X” and walk out with “X”, without having paid for it.
It all depends…
@TheUncleBob: What am I missing? That’s what the courts are for!
I think my point is being missed…if someone shoplifts, they need to be prosecuted VIA THE LEGAL SYSTEM. The store is no more in the right extorting money than the shoplifter was to begin with.
If you want to free up the couts, make it so that a store employee can at least confront a person who is suspected of shoplifting without fear of being sued.
@MPHinPgh: Going to the courts to settle a dispute should always be a last resort between two parties when all other reasonable options have failed. Think about it, do you want your kids running to you every time they disagree?
>”make it so that a store employee can at least confront a person who is suspected of shoplifting without fear of being sued.”
I can agree with that.
The civil demand letters are not a new practice at all- you are just hearing about them now. in use for at least 15 years now.
In California, one would want to be familar with Penal code section 490.5 with regard to shoplifting misdemeanor theft(<$400)(PC484/488). these rules change if they accuse you of a felony such as burglary YMMV.
In California, it is illegal to resist *any* arrest even if the suspect knows or believes it to be an illegal arrest. Keep this in mind.
In California, if you make it outside the store/beyond the checkstands, you will be contact by two or more lp agents who *ask* you to return to the store.
If you decline, they will ask to see a receipt and/or search your outermost clothing for thier merchandise (this is legal).
If you decline the search it is likely they will either arrest you on the spot or let you continue on your way- depending on how good they feel their evidence is.
A legal arrest in CA- you must be informed you are under arrest before being restrained. Can be in quick succession but must be in that order.
In California, if placed under citizens arrest(not just stopped and searched/talked to) by store personnel and you know it to be wrong and can prove it, make no statements- invoke your right to remain silent and consent to nothing.
That does not mean you do not have to ID yourself to police- just not answer incriminating questions. You do not have to make any statements.
In lieu of calling the Police many stores will present you with a civil agreement that releases them from all liability, you admit guilt and that you are banned from the store forever. If you are in the right and can prove it– keep your mouth shut and do not sign that agreement- it will turn the whole arrest into something akin to a civil conversation over tea among kleptomaniac friends who never want to see one another again.
If you do sign you will be released and then get a civil demand letter.If this happens, game over and they will a least send the demand letter
This will force them to turn you over to the police. This is good if you are right because it forces the store to commit to a story in writing.
Remember, the police are not the ones arresting you- the agent of the store is.
In California, a peace officer can do one of three things upon ‘receiving’ a citizens arrest:
1. release per PC849b- essentially ‘un-arrest’ you or release without charge (Cop he/she does not believe it).
2. identify you and release you on a notice to appear/ ‘a ticket’ with a court date.
3. Book you (likely if your identity is at all in question)
If you are in the wrong the rules change again but i will not help you there. This is the common workflow in California and how one might protect ones interests when accused wrongly by overzealous loss prevention agents.
It all boils down to if you are not charged by the district attorney, then the store violated your Civil rights for no legal cause which as we all know translates into dollars.
There is tremendous liability involved for the stores
do not kid yourselves. That is why many have internal rules like must have constant observation, video, or two witnesses,no pursuit off of store property etc.It all comes down to moolah.
My opinion, if you are wrongly accused, keep your mouth shut and leave the pen on the table.
I am now making month payments for the total of $425
to palmer and associates law firm in Florida because of my son accused of stealing a computer game at wal mart. To my surprise they sent me a letter demanding $150
and I called but they didn’t answer and left a message
but they never call me back. The second letter demanding of $425 because I missed the deadline for the paument. This
is just outraged and I am sick to my stomach. I never
received a phone call from wal mart nor police on the
day my son was caught in the store. I called and
explained but the clerks at the firm was very rude.
I just wish some lawyer would present us the parents
to fight back this palmer law firm for the unbelievable
fine. Just VERY unfair to the parents.
Some establishments unofficially ‘backroom’ people caught by Loss Prevention Associates. Especially if they’re employees; before calling the police they often threaten the alleged offenders with physical harm if they don’t comply and confess to whatever it is that the company suspects they’ve done.
What the point of it is, I have no idea, since it’s probably not binding. This is something, however, I’ve heard from actual loss prevention associates at certain establishments.
It’s not something I believe fully, but we’ve all told our friends of those ‘little company policies’ no one ever hears about.