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To: Glenn D. Rudolph who wrote (52633)	4/26/1999 12:01:00 AM
From: GST	Respond to of 164684

Sunday April 25, 11:31 pm Eastern Time U.S. regulators probe Internet pricing practices PALO ALTO, Calif. April 25 (Reuters) - The District Attorney's office in Santa Clara County here says it is planning to file a complaint against the Internet retailer Onsale Inc, charging it with misleading advertising in connection with its ''atCost'' sales promotion. Although prosecutors would not elaborate on the nature of the complaint, Onsale said it centers around whether it has been misleading customers by claiming to sell items at wholesale cost, plus a small fee and shipping charges. Onsale, which sells computers and consumer electronics products, says it charges its customers regular shipping rates. What it did not initially tell those customers, was that it received a corporate discount on shipping charges -- which prosecutors claim amounts to deceptive advertising. Onsale disclosed news of the dispute Friday, when it filed a request for delaratory relief against the Santa Clara County District Attorney and the California Attorney General. The company says it agreed to change the wording on its Web site after consulting with the District Attorney. But it maintains it should not have to pay a civil penalty to provide compensation to its customers. The company says it is a common retail practice to charge customers standard UPS rates while negotiating bulk shipping discounts. Onsale is one of many Internet retailers offering to sell items at cost or razor thin margins in the race to attract more customers. Prosecutors declined to say whether they were investigating any other companies' pricing practices. They also would not disclose the amount of compensation they wanted Onsale to return to its customers.