MATTRESS COMPANY, STATE SETTLE PROBE

DANIELLE T. FURFARO Business writer
Section: BUSINESS,  Page: E4

Date: Tuesday, November 14, 2000

The state attorney general's office announced Monday that it has reached a settlement with Resnick's Mattress Outlet Inc., which had been under investigation for allegedly false advertising and deceptive business practices. Under the terms of the settlement, the Newburgh, Orange County-based Resnick's agreed to stop running certain advertisements and ensure that it does not engage in ``bait-and-switch'' tactics. Resnick's also agreed to pay the attorney general's office $10,000 for the cost of the investigation.


The Resnick's ads featured company owner Justin Resnick, who offered mattresses for $29.95 to $59.95. However, the attorney general's office found that when customers inquired about those mattresses at the Resnick stores, salespeople discouraged them from purchasing them and directed them toward more expensive mattresses in the store.


``(Bait-and-switch) is an age-old sales tactic that gives an unfair competitive advantage to a business over its competitors by using false promises,'' Attorney General Eliot Spitzer said.


The company had also claimed that it would double a customer's money back if they could find a mattress for less from a competitor within a 100-mile radius. But the guarantee was moot, since most of Resnick's product is manufactured specifically for the company and could not be found at competitors, according to Spitzer's office.


In addition, Resnick's has agreed to clarify the limitations and conditions on its offer for a free frame, delivery and removal, as well as provide a five-year warranty on any mattress it sells for $100 or less.


``What Resnick has done by filling the airwaves with this false advertising is to diminish the integrity of the industry,'' Spitzer said.


Justin Resnick attempted to downplay the significance of the settlement Monday, saying he paid the $10,000 to avoid paying more for a lengthy trial.


``For me to defend myself would have cost $40,000,'' he said. ``It looks like I just saved $30,000.''


There are four Resnick's Mattress Outlet stores in the Capital Region.