The chain was accused overcharging customers for sale items, and for engaging in misleading advertising, according to the district attorney's office.
District attorneys from Los Angeles, Ventura and Riverside counties filed the civil complaint on August 11.
CVS agreed to pay $1.2 million in civil penalties and $42,000 in investigative costs, as well as $300,000 to the California Department of Measurement Standards and $100,000 to the Consumer Protection Trust, according to the L.A. District Attorney.
CVS agreed to the settlement without admitting liability and worked cooperatively in reaching a settlement with prosecutors, according to the D.A.'s office.
According to the D.A.'s office, CVS agreed to complete corrective action to advertising by Oct. 30, and agreed to initiate and administer pricing programs for a period of three years
CVS also will implement a scanning program guarantee that will give consumers up to $2 off if an item has scanned at a higher price than advertised, the D.A.'s office said.