A class action has been filed targeting Kate Spade alleging the unlawful, unfair, and fraudulent business practice of advertising fictitious prices and discounts on merchandise sold in its retail outlet stores.
This practice of deceptive pricing may occur when a retailer fabricates a fake regular, original, and/or former reference price, and then offers an item for sale at a “discounted” price. This can mislead consumers into believing they are receiving a good deal and induces them into making a purchase.
Kate Spade allegedly produces separate merchandise for its retail and outlet stores. The Kate Spade outlet stores allegedly advertise its merchandise for sale by attaching a price tag to the item with reference and discount prices. The reference price appears as a strikethrough, for example, “$575.00,” followed by the discounted price at which the item is being offered for sale, i.e. “$289.00.”
This sets forth a fictitious reference price for which the merchandise is sold in its retail stores, since the item is allegedly never sold in the retail stores, as is made exclusively for the outlet stores.
Retailers may benefit from advertising deceptive prices because the net effect of this practice is that the market value of the falsely advertised product is artificially inflated.
If you or anyone you know may have shopped at Kate Spade outlet stores, please contact Finkelstein Thompson LLP. You can reach us at contact@finkelsteinthompson.com or call us toll-free at 1-844-280-5009.
