Spitzer Sues Simon Property Group Over Gift Card Fees
New York State Attorney General Elliot Spitzer has announced that his office has filed a lawsuit against shopping mall operator Simon Property Group alleging that fees on its Simon Giftcard violate a recently enacted state law.
At its shopping malls and on its website, Simon promotes and sells pre-paid gift cards. It charges a fee of $1.50 for each card if purchased at its malls or $5.95 for "shipping and handling" if purchased on the Internet. In addition, Simon charges a $2.50 monthly "administrative" fee commencing in the seventh month after purchase; a 50 cent fee for each telephone balance inquiry; a $5 fee to reissue a lost or stolen gift card; and a $7.50 fee to reissue an expired card.The Attorney General's lawsuit charges that Simon's assessment of a monthly administrative fee on gift cards purchased after October 18th, 2004 violates the state law that bans monthly service fees on gift cards until the card has been unused for twelve full months.
Spitzer's office also alleged that Simon is violating another provision of the law by assessing a $5 fee to replace a lost or stolen gift card without conspicuously disclosing that fee on the gift card itself.
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