FOR IMMEDIATE RELEASE:

May 27, 2003

FOR FURTHER INFORMATION CONTACT:
Genene Morris (973)504-6327

NEWARK - Atlanta-based Home Depot has agreed to revise its business practices to ensure compliance with the State's consumer protection laws, including, in particular, the form of its home improvement contracts, Acting Attorney General Peter C. Harvey and New Jersey Division of Consumer Affairs Director Reni Erdos announced today.

As part of the agreement, called an Assurance of Voluntary Compliance ("AVC"), Home Depot will pay the State $510,000. The AVC follows an investigation by Consumer Affairs into whether the home repair retailer violated New Jersey's Consumer Fraud Act in connection with its home improvement practices, advertising policies, delivery of household furniture and furnishings, and implementation of its refund policy. The investigation was opened following Consumer Affairs' receipt of dozens of consumer complaints against Home Depot.

Complaints were made against various Home Depot locations in New Jersey, including allegations that certain stores were deceptive in their description and pricing of advertised items; incorrectly represented that products or materials were of sufficient size, capacity and quality to complete a home improvement; failed to complete home improvement work or make deliveries in the time frame represented; and failed to provide refunds to dissatisfied consumers.

Home Depot, which has 58 stores in New Jersey, cooperated with the State's investigation and has not admitted any wrongdoing.

"We are pleased that we were able to negotiate a resolution that benefits consumers," Acting Attorney General Harvey said. "Through this agreement, we have been given assurances that Home Depot will comply with New Jersey's consumer protection laws and treat consumers fairly and honestly."

"People have a right to expect that when they purchase products and services from businesses they will not be subjected to unlawful business practices," Director Erdos said. "We have negotiated an agreement that ensures compliance with New Jersey consumer protection laws and that will help aggrieved consumers."

Under the terms of the agreement, Home Depot will ensure that its home improvement contracts entered into in New Jersey comply with the Consumer Fraud Act, including the regulations governing home improvement. For example, Home Depot has agreed to refrain from requesting that the consumer sign a certificate of completion or make final payment on the contract before the home improvement work is completed in accordance with the terms of the contract.

The agreement also calls on Home Depot to, among other things:

• Ensure that its advertisements comply with the State's advertising regulations. For example, all advertisements for home appliances must contain the manufacturer's name, the model or series number, and other information necessary to clearly delineate the advertised item from other similar merchandise produced by the same manufacturer.
  
• Comply with regulations governing delivery of household furniture, ensuring that merchandise is delivered in accordance with the contract and recognizing that any non-conforming merchandise will not constitute a delivery.

Also, as part of the agreement, Home Depot will investigate and resolve consumer complaints received prior to the filing of the AVC either with each consumer individually or through Consumer Affairs' Alternative Dispute Resolution Unit.

This is the third agreement Home Depot has entered into with New Jersey. The first agreement dates back to 1993 when Home Depot paid $4,200 to settle allegations that it failed to disclose in its advertisements the grade and/or species of certain lumber, lumber products or building materials. The second agreement is dated January 29, 1996 and stemmed from alleged violations of the State's advertising laws. The company paid $10,000 in penalties and costs.

Deputy Attorney General Sharon A. McCloskey of the Division of Law handled this matter for the State.