Blockbuster To Pay $300,000 In Calif. Probe Into Overcharging

   DOW JONES NEWSWIRES 
 

Blockbuster Inc. (BBI) will pay $300,000 in civil fines and costs to resolve a four-year probe looking at the video-rental giant allegedly overcharging customers in California.

The decision comes as Blockbuster has been battling slumping sales as it's faced with the recession and increasing competition from online rivals such as Netflix Inc. (NFLX). The company also has struggled to conserve cash amid concerns about its liquidity.

Blockbuster was found to have charged customers more than the advertised or posted price on scanned items. The investigations covered 14 counties, and the agreement was announced by the district attorneys offices in San Diego and Los Angeles counties.

"The judgment is an important step toward pricing accuracy and fairness in the marketplace," said L.A. District Attorney Steve Cooley. "Consumers should be able to rely on the accuracy of the prices charged at the check stand."

Blockbuster, which did not admit wrongdoing, will pay $237,750 in penalties and $62,250 in costs.

Shares closed at 79 cents Monday and didn't trade premarket. The stock is down nearly 80% from last year, though it has rallied since hitting an all-time low of 13 cents in March.

-By Tess Stynes, Dow Jones Newswires; 201-938-2473; [e-mail]