Dollar General stock falls on price lawsuit

Dollar General shares declined approximately 4% on Monday following the Federal Trade Commission's announcement of a new lawsuit against the retailer.

The FTC, joined by 20 state attorneys general, alleges that Dollar General stores consistently charged customers higher amounts than the prices displayed on shelves, tags, and advertisements. The complaint describes the practice as extracting millions of dollars from vulnerable shoppers through insufficient safeguards.

Regulators claim the company received tens of thousands of consumer complaints regarding these price discrepancies but failed to implement policies to correct the errors. The 20 states participating in the suit include Alabama, Arizona, Arkansas, California, Connecticut, Florida, Illinois, Iowa, Kansas, Louisiana, Michigan, Mississippi, Nebraska, New Jersey, North Carolina, Ohio, Oklahoma, Tennessee, Utah, and Wisconsin.

Christopher Mufarrige, director of the FTC's Bureau of Consumer Protection, stated that the retailer betrayed the trust of millions of American consumers. He noted that the company imposed financial harm on communities already struggling to stretch their paychecks.

Dollar General did not immediately respond to requests for comment on the filing. The legal action arrives as shoppers seek discounts amid elevated food and gas prices. Officials across the political spectrum are also using the suit to demonstrate consumer protection efforts ahead of the midterm election next week.

The complaint marks a coordinated federal and state effort to address routine pricing errors at major discount retailers.