Nintendo of America Inc., maker of the popular home video game, has agreed to give up to $25 million in coupons to customers and pay $5 million to settle charges that it fixed its prices, officials said Wednesday.
The maker of America's hottest-selling toy did not admit to the charges but agreed to partially refund people who bought its 8-bit Nintendo Entertainment System video game consoles for $99.95 from June 1988 to December 1990.The Federal Trade Commission filed the antitrust complaint against Nintendo, charging the company fixed the prices of its games through agreements with its dealers.
Howard Lincoln, Nintendo senior vice president, said the company did not admit it violated antitrust laws but said it settled the case to maintain consumer good will rather than get involved in a lengthy court fight.
"We were concerned with how Nintendo game players might view these allegations," Howard said. "We opted to get this behind the company immediately and in a manner that provides real value to Nintendo game players."
Nintendo has agreed to issue redemption certificates worth $25 million and guaranteed the redemption of at least $5 million in certificates.
Every purchaser of an NES console during the 30-month period is entitled to a $5 coupon, good on the purchase of a Nintendo game cartridge, the officials said.
In addition, Nintendo agreed to pay New York and Maryland, whose officials investigated the charges, a total of $1.75 million to cover administrative costs, and $3 million more to other states that agree to settle.
Federal Trade Commission officials also agreed to the settlement terms.
Under the proposed consent agreement, Nintendo has agreed to refrain from:
- Fixing the price at which any dealer advertises or sells Nintendo products to consumers.
- Reducing the supply of Nintendo products to dealers because of failure to adhere to minimum suggested prices.
- Asking dealers to report other dealers who offer Nintendo products below resale prices suggested by Nintendo.
Nintendo said consumers will be notified about the process of getting a coupon following preliminary court approval of the settlement, and will automatically get a coupon when court approval is completed.
Nintendo of America Inc. of Redmond, Wash., is a subsidiary of Nintendo Co. Ltd., the Japanese maker of computer games.
Customers may find out if they are eligible for the $5 coupons by calling 1-800-255-3700.