Chipotle Mexican Grill has settled a consumer protection lawsuit alleging it failed to allow California consumers to cash out Chipotle gift cards with a remaining balance of less than $10, the Los Angeles County District Attorney announced Thursday.
“Gift cards are real money purchased with hard-earned cash,” Los Angeles County D.A. Nathan J. Hochman said in a statement. “California law is clear that consumers have the right to redeem gift cards with a balance under $10 for cash. I thank Deputy District Attorney Duke Chau of our Consumer Protection Division for handling this case along with our partner district attorney’s offices throughout California.”
The final judgment entered in Ventura County Superior Court totals $246,000, which includes:
- Civil penalties: $145,467 total; $36,367 to the Los Angeles County District Attorney’s Office
- Investigative costs: $88,533 total; $20,000 to the Los Angeles County District Attorney’s Office
- Restitution: $12,000 to the California Consumer Protection Prosecution Trust Fund to support the investigation, prosecution, and enforcement of consumer protection actions brought under California’s unfair competition statutes
The judgment, in which Chipotle denied any wrongdoing, also provides for injunctive relief over a four-year period. Under the order:
- Chipotle must create and maintain a website portal — initially accessible at chipotle.com/gift-card-cashback — where consumers can request refunds for gift cards with balances of less than $10. California consumers must enter their card’s identifying information to obtain a refund.
- Chipotle must ensure new gift cards, including those sold through third parties, display an updated notice on the front or back informing California consumers they may redeem the card for cash when the remaining value is under $10. The notice must also include the website address where consumers can request a refund.
- The company is prohibited from using information associated with gift card redemptions for unrelated purposes, such as advertising or marketing, without the consumer’s consent.
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