The Illinois Appellate Court reversed a decision by the Illinois Circuit Court in a class action concerning the Consumer Fraud Act, where a retailer was alleged to have improperly collected taxes on exempt bottled water products. The court found that the voluntary payment doctrine did not apply to a payment that was allegedly obtained through deceptive business practices or acts. The court also found that an intent to deceive could be shown by evidence that the payment of the tax by the consumer was a predictable consequence of the retailer asking the consumer to pay the tax.
In 2008, the City of Chicago began imposing a five-cent tax on the sale of bottled water within city limits. Retailers are required to include the tax in the price of bottled water. The city excludes certain bottled beverages from the tax including certain brands of sparkling and mineral water, and other flavored and carbonated water products.
Destin McIntosh sued Walgreens Boots Alliance in Illinois state court. McIntosh filed a class action alleging that Walgreens violated the Consumer Fraud and Deceptive Business Practices Act by charging the bottled water tax on sparkling water sales that were supposed to be exempt. Walgreens attempted to dismiss the case, arguing that McIntosh’s claim was barred because the tax was disclosed to McIntosh at the time of purchase and that the tax was remitted to the city. The Illinois circuit court granted the motion, and McIntosh appealed. Continue reading