$50 Million Class Action Filed Against Nestle Waters in New Jersey Federal Court

Nation’s Largest Bottled Water Company is Allegedly Defrauding Its Customers

NEWARK, N.J., Aug. 31, 2011 /PRNewswire/ — Nestle Waters North America Inc. is not only the largest bottled water company in the U.S. with 41% of the nation’s market, the giant corporation is defrauding its customers, according to a class action complaint filed today by its customers in U.S. District Court for the District of New Jersey.

The plaintiff, a long standing customer from New Jersey, asserts in the complaint that Nestle Waters regularly breaches its contracts with water delivery customers nationwide by assessing late fees on their accounts during a grace period even when customers have made timely payments, and charging an excessive late fee of up to 75% or more.

Steven L. Wittels, a founder and partner of Sanford Wittels & Heisler LLP and lead attorney for the Plaintiffs and the Class, called the water giant’s practices the “slipperiest” he has ever seen. “What good is a grace period,” Mr. Wittels asks, “if you soak the customers with a late fee before the grace period even ends? To add insult, the water company’s punitive late fee aims to drain its customers of hard-earned monies.”

The suit asks the court to certify the lawsuit as a class action because Nestle Waters’ actions constitute a breach of contract and violation of the Consumer Fraud Act in New Jersey and all other states where the company conducts business. Plaintiff is seeking an award in excess of $50 million in damages and costs for the class.

“Under the law, a late fee must be reasonable,” said Jeremy Heisler, co-counsel for the plaintiffs. “Nestle Waters’ flat $15-$20 late fee fails that test because the company charges the same amount no matter how large the fee is in relation to the amount overdue, or how many days the payment is late. They charged our customer nearly 50% of the monthly payment due. The late fee is simply a penalty.”

Nestle Waters’ billing practices are unfair in two ways. First, it promises customers a grace period for paying invoices, but then ignores its own promise and imposes late fees even when customers timely pay their bills during the grace period. Second, when customers do pay late, Nestle Waters imposes an exorbitant late fee sometimes exceeding 75% annually, and this constitutes an illegal penalty.

Under its own written policy, Nestle Waters provides a 10-day grace period after the due date for customers to make payments on their accounts. Nestle’s policy further says it “may” assess a late fee only after the grace period has expired. But, rather than adhering to this policy, Nestle routinely adds a $15 late fee to customers’ accounts on the first day of the grace period.

Nestle Waters conducts its billing scheme through its bottled water divisions, including Poland Spring Brand 100% Natural Spring Water, Arrowhead Brand 100% Mountain Spring Water, Deer Park Brand 100% Natural Spring Water, and Perrier.

The Complaint asks the Court to grant class certification, award compensatory damages for the Plaintiffs, treble damages, and all costs and disbursements related to the suit, as well as to enjoin Nestle Waters from continuing to implement its unlawful trade practices and schemes.

About SWH

Sanford Wittels & Heisler LLP (SWH) is a law firm with offices in Washington, D.C., New York, and San Francisco that specializes in employment discrimination, wage and hour, consumer and complex corporate class action litigation and has represented thousands of individuals in some of the major class action cases in the United States. The firm also represents individual clients in employment, employment discrimination, sexual harassment, whistleblower, public accommodations, commercial, medical malpractice, and personal injury matters.