In California, CVS Caremark was the focus of California Attorney General Jerry Brown, who in June of 2009, negotiated a $975,000 settlement of a civil lawsuit with CVS Pharmacy along with an agreement to give $2 coupons to anyone who found expired products on their shelves, and designates a toll-free number to call to report such items.
Now, there's a charge from a reliable source that CVS (formerly Long’s Drug stores in California) as well as Krogers, Ralphs, and other major chain stores are selling ‘diverted’ or grey market products that may counterfeited.
In some cases, the claim is the California consumer is even getting products that can be dangerous.
“Diverters” are companies are selling these stores products that have been diverted from their intended sales point or they may even be selling counterfeit products.
If this turns out to be the case, CVS will again be in violation of the same California laws under the Business and Professions Code 17200 and the Civil Code 1798.81 by misleading customers.
On August 14th of 2009, the Modesto Bee wrote wrote that a number of county district attorneys, including Stanislaus San Joaquin, Sacramento, San Bernardino and Solano counties have joined in the statewide lawsuit against several national retailers who stock beauty supplies alleged to violate California environmental law.
That lawsuit, originally brought by the District Attorney of Stanislaus County, sought penalties of at least $17 million, with amounts to be levied based on each day a prohibited hair product is offered for sale, according to court papers. The case also named Longs Drug Stores, Target, Rite Aid, Walgreens and Ralphs, among other defendants.
That lawsuit named a New Jersey company, Pro Choice Beauty Care Inc, that provides the products to the retail stores — without approval from the brand manufacturers. It is unclear how clear where Pro's Choice Beauty Care Inc. gets its products. It is believed to be a “diverter” of products.
The hair products that were being sold were found to contain elevated levels of smog-forming volatile organic compounds, state environmental authorities said, according to the Modesto Bee.
Stay tuned for more information as this story unfolds both here in the Bay Area and around California. I've made several calls to sources; I expect follow-ups soon.
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