Oregon Cracks Down on HelloFresh for Charging Hidden Costs Behind Its So-Called Free Offers
Oregon Attorney General Dan Rayfield confirmed that the Oregon Department of Justice (ODOJ) settled with Grocery Delivery E-Service USA, Inc., doing business as HelloFresh, after finding that the company misled consumers with deceptive “free meal,” “free shipping,” and “free gift” offers.
No More HelloFresh “Free” Meals, Shipping & Gifts Adverts Allowed In Oregon
HelloFresh routinely advertised promotions such as “10 free meals,” “$180 off,” or a “Free 8” Caraway Fry Pan.” But the meals were not free- the company failed to disclose the actual cost and conditions of its discounts clearly.
AG Rayfield said,
There’s no such thing as ‘free’ if families must spend hundreds of dollars to unlock the deal.
Discounts were spread across multiple weekly orders, and customers would need to spend hundreds of dollars to get the freebies.
HelloFresh also didn’t disclose that consumers had to buy a certain number of boxes to receive advertised gifts, such as an 8” Caraway fry pan, so customers who canceled early never received the promised item.
The “free shipping” offers also only applied to the first box, but shipping was charged on subsequent boxes without clear disclosure.
In terms of the settlement under an Assurances of Voluntary Compliance (AVC), HelloFresh must:
- Pay $106,000 to the State of Oregon, and must change its advertising practices.
- Disclose prices accurately, clearly stating when discounts apply only to new customers or only to the first box, and how many boxes a customer must purchase to receive the full value of any discount.
- Include all material terms and limitations clearly and conspicuously on “Free” offers.
- Be transparent about shipping costs and can’t advertise “free shipping” unless shipping is actually free for all boxes in the offer.