(Gatineau) The Competition Bureau obtained a court order as part of an investigation into whether Léon and its subsidiary Brick marketed their products in a misleading manner.
Posted yesterday at 1:13 p.m.
He said Wednesday that the ongoing investigation into Canadian furniture retailers focuses on three types of business practices.
The first is to announce special offers without specifying the amount of the discount or to use different font colors to make customers believe that they are taking advantage of a bargain.
The second is to inflate the usual prices when announcing a promotion.
The third is related to “urgency” cues, which often take the form of a countdown or “time-limited” marketing and can create false impressions about the nature of a promotion.
The Competition Bureau has not yet concluded that Léon or Brick committed wrongdoing, but the Federal Court order it obtained will allow it access to new records and written information relevant to its investigation, which began on August 6.
This type of order is “a normal procedure for all investigations of this nature,” the two retailers stressed in a press release.
They maintained that they were committed to complying with all regulatory requirements and were cooperating with the investigation.
“Both companies offer consumers quality products at attractive prices, which represents excellent value for money,” Audrey Hyams Romoff, a spokesperson for Léon and Brick, said in a statement.
“To strengthen their compliance efforts, Leon and Brick have established long-standing protocols to meet advertising standards,” she added.
Léon, founded in 1909 and operating 85 stores, and Brick, established in 1971 and now with 209 stores, are known for selling home furnishings, mattresses, electronics and appliances.
The two companies were rivals until November 2012, when Leon paid 700 million to buy Brick.
Less than a year later, the Bureau investigated the “Buy Now, Pay Later” promotion, alleging that customers often paid more than advertised.
In 2018, Leon and Brick reached a settlement with the Bureau agreeing to adhere to guidelines on the appropriate use of disclaimers in advertising and disclosing fees associated with their financing plans.
As part of the settlement, Leon and Brick also promised to donate $750,000 worth of home furnishings over two years to charities approved by the regulator.
The Competition Bureau has made passing off cases a cornerstone of its work in recent years.
In September, he won a 38.9 million lawsuit against the cinema giant Cineplex, which he accused of having deceived its customers by imposing online ticketing fees. Cineplex is now contesting this decision.
The Bureau also took action against several companies it said were engaged in pay-as-you-go pricing, including SiriusXM Canada, Discount Car & Truck Rentals and TicketNetwork. Dropper pricing occurs when customers are lured into making a purchase without being fully informed of the final cost.
