Home Depot Accused of Shaking Down Shoplifters

Sept. 11, 2013 -- Home Depot has intimidated thousands of customers accused of shoplifting into collectively paying millions of dollars to have such accusations dropped, even though the company has no intention of suing, a class-action suit alleges.

The suit claims that the big box retailer is using California's Civil Shopping Law as "a profit center" by arbitrarily seeking "damages" from accused customers.

According to the complaint, filed in Alameda, Calif., Superior Court, Jimin Chen and a friend went shopping at a Home Depot in San Leandro on June 6. Before loading lumber onto a cart, each man put on a pair of $3.99 work gloves, to protect their hands.

Before Chen's $1,445.90 purchase was rung up, says the complaint, he removed his gloves and left them on top of the merchandise in his cart, where they were plainly visible. The checkout personnel, however, failed to scan the gloves.

Immediately after Chen paid, and before he had left the store, he was accosted from behind, according to the complaint, by a Home Depot security guard, who told him he had failed to pay for the two pairs of gloves. Chen and his friend were taken into custody by Home Depot security for about 30 minutes, during which time Chen, because of stress and lack of air in the holding room, suffered an asthma attack.

"As panic set in due to plaintiff's asthma attack," says the complaint, "Home Depot's security guard placed plaintiff, who weighs about 115 pounds, in handcuffs."

Watch: How Much Does Shoplifting Cost You?

The suit alleges that the two accused shoplifters were told they would be allowed to leave only if they submitted personal identifying information and signed a document agreeing to stay out of the store for 90 days. They complied. Upon their release from Home Depot detention, said the complaint, they were given a one-page document titled "Notice of Intent to Exercise the Rights and Potential Remedies of Home Depot."

They were not arrested, and the police were never called, according to the complaint.

Nevertheless, according to the complaint, the notice warned them that "You may face both criminal charges and a civil claim related to this incident." It also stated, "You will soon receive further information from the Home Depot's attorneys, (law offices of Palmer, Reifler and Associates) regarding demand for the civil penalty." Failure to respond promptly, it warned, might subject them to further liability.

On or around June 10, according to the complaint, Chen received a letter from the law firm demanding that he pay $350 within the next 20 days or else risk being sued by Home Depot for theft of merchandise. This "first demand letter," stated the lawsuit, "is a standard form letter that has been and continues to be sent to hundreds, if not thousands, of individuals accused by Home Depot of shoplifting from its stores in California."

When Chen did not respond, the suit alleges that he received a "second demand letter" dated July 5 telling him he now had to pay $625. It repeated the threats contained in the first letter, which included that he might be sued by Home Depot, and, that if he lost, Home Depot would seek "damages, attorney's fees and court costs up to the maximum amounts allowed by law, which could possibly exceed the amount demanded above." If Chen opted to pay by credit card, a "convenience fee" of $14.50 would apply.