Thorn shares hit by US court ruling

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The Independent Online
Shares in Thorn, hit their lowest yet yesterday, plunging 9 per cent to close at 151.5p, after the company said a New Jersey court ruling could force it to pay $120m (pounds 75m) in damages for overcharging customers at its Rent-A-Center stores.

The company, which has given investors a rough ride since it split from EMI last August, admitted yesterday that it was considering making a provision to cover the costs. Thorn announced only four months ago that it had been forced to make a pounds 17m provision against possible damages relating to a similar case in Minnesota.

City analysts expressed concern yesterday that other suits could incur substantial costs. Claims in Wisconsin, Pennsylvania and Texas are still outstanding, and observers said there were worries that customers in other states would follow suit.

One analyst said: "It's very difficult to know when the next spot on the horizon will appear. Some other states may decide to join the bandwagon."

Thorn said it would appeal against the court's judgment, which ruled that the Rent-A-Center stores owed customers - many of whom are on a low income - fees and interest paid for home furnishings. The judgment said customers were entitled to recover 40 per cent of what they had paid, but under New Jersey law Thorn could be liable for three times that figure.

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