What does Minnesota’s beloved Target Corporation do with “unsaleable TV’s”? Why, it sells them, naturally!
Not to retail customers, of course, but to a salvage company that agrees to pay Target 36% “of the original retail price” for product returns, regardless of the condition of the returns.
At least, that mutually beneficial arrangement was the hope and expectation of Target and a Canadian company by the name of ERS.
But apparently this was not a mutually beneficial arrangement because ERS exercised its right to terminate the contract with Target and, according to Target’s recent complaint, ERS walked off with $4,269,585 of Target’s money (some in the form of TV’s that ERS did not pay for and some in the form of an agreed upon “termination fee” that ERS promised if it walked away from the deal).
There are some curious aspects of Target’s complaint filed against ERS in U.S. District Court (D. Minn) (assigned to U.S. District Court Judge Joan N. Ericksen) last week. First, six pages seems quite terse for a $4.3 million claim. Second, it seems out of the ordinary not to attach the contract. Maybe it had some confidential terms?
I look forward to hearing ERS’ side of the story. I am guessing that there might be a dispute as to what “the original retail price” is? Could Target put a $200 TV on the shelf for a few days at $450, then slash the price to a “sale price” of $200, then get ERS to pay 36% of the grossly inflated “original retail price”?