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Groupon Faces Litigation

Friday, 22 Jul 2011 02:40 PM

Daily deal website Groupon is being sued in Illinois for not considering their daily deals to essentially be gift cards that come with an expiration date, Syracuse.com reports.

Adam Dremak bought a $25 deal on Groupon for $50 worth of merchandise at Nordstrom rack, but the voucher expired before Dremak could use it.

The Groupon customer claims that the Illinois Consumer Fraud and Deceptive Business Practices Act prohibits the sale of gift cards that expire within five years. Groupon has navigated around this law by claiming that they do not sell gift cards.

Groupon has not commented on the litigation.

The website, which filed for an IPO last week, faces more than 15 similar class-action suits against them, all of which argue that Groupon discounts should be considered gift certificates, not coupons.

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