Groupon Customers Might Not Get Any Cash From That $8.5 Million Settlement

Andrew MasonAndrew Mason, Groupon founder and CEO

Photo: Flickr

Groupon is shelling out $8.5 million as part of a settlement of a class action over its expiration dates.Customers received notices of the deal early Thursday. But that doesn’t mean they’re actually getting any cash, according to CNNMoney’s Julianne Pepitone.

Anyone in the U.S. who bought or received a Groupon from Nov. 1, 2008 through Dec. 1, 2011, is eligible to be part of the settlement in which Groupon didn’t admit wrongdoing.

But the settlement stipulates that people who submit claims will receive “settlement vouchers,” that can be redeemed through merchants for products, “up to the price that you paid,” Pepitone reported.

That means if you spent $20 for a $50 spa voucher, you can redeem that voucher for $20 worth of spa products.

But, if a merchant doesn’t honour the settlement voucher, a customer can submit a second claim to the settlement fund and receive a refund check on what they paid plus 20 per cent of the deal’s promotional value, according to the settlement.

In a notice sent to active users, Groupon advised users they may exclude themselves from the settlement by July 6. 

A good portion of the settlement money will be going to the legal team that spearheaded the case, which reportedly asked for more than $2.1 million in attorneys’ fees, Pepitone reported.

The original 17 filers are set to receive $500 each, meaning the remaining money could be divided up among 34 million active subscribers. If that’s the case, Pepitone pointed out, claimants will receive pennies, not dollars.

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