Photo by Beyond My Ken (Own work) [GFDL (http://www.gnu.org/copyleft/fdl.html) or CC BY-SA 4.0-3.0-2.5-2.0-1.0 (http://creativecommons.org/licenses/by-sa/4.0-3.0-2.5-2.0-1.0)], via Wikimedia Commons
Photo by Beyond My Ken (Own work) [GFDL (http://www.gnu.org/copyleft/fdl.html) or CC BY-SA 4.0-3.0-2.5-2.0-1.0 (http://creativecommons.org/licenses/by-sa/4.0-3.0-2.5-2.0-1.0)], via Wikimedia Commons
Just as the Christmas shopping season rolls into high gear, Los Angeles City Attorney Mike Feuer has filed a suit Thursday against four big retailers for deceptive advertising that allegedly misled shoppers into believing thousands of products were on sale at hefty discounts.

The retailers — Macy’s, Sears, JC Penney and Kohl’s — allegedly advertised high “list” or “regular” prices on merchandise that was never actually available at that price, according to the lawsuit, in a practice known as “false reference pricing.” The pricing allegedly caused customers to believe they were getting a better bargain with the “sale” price than they actually were.

“When is a discount not really a discount? When is a sale not really a sale?” Feuer asked Thursday in announcing the suits.

California law bans retailers from advertising a higher original price unless a product was actually available at that price within three months of the ad running. Feuer said the evidence his office collected focused on thousands of online transactions, but that he had reason to believe the practices also were underway at stores.

“How hard is it for any individual consumer to enforce this? It’s almost impossible, so this is why it falls to us on behalf of the people of the state to take an action like this,” Feuer said.

The suits will seek civil penalties and injunctions to prohibit such pricing.

This is not the first time that retailers have gotten in trouble for false reference pricing schemes, the Los Angeles Times reported. In 2015, class action lawsuits were filed against JC Penney and Kohl’s accusing the retailers of tricking customers by inflating original prices. JC Penney eventually settled the suit for $50 million in cash and store credit to customers, and Kohl’s agreed to pay $6.15 million.

Feuer said that JC Penny’s and Kohl’s represented to courts in the class action suits that they would not engage in false reference pricing, “But we allege that they continue to do it anyway.”

Representatives of Macy’s, J.C. Penny and Kohl’s did not respond to requests for comment and a representative of Sears declined to comment.

Feuer cited several specific examples of evidence his office collected for the suits. They include:

In February, 2016, J.C. Penney’s website allegedly first advertised a maternity swim top with an “original” price of $46 and a “sale” price of $31.99.  However, the purported “original” price of $46 allegedly was a false reference price.

In January, 2016, Kohl’s allegedly first offered for online sale belted cargo shorts for a reduced price of $35.99 from an “original” price of $60. However, the purported “original” price of $60 allegedly was a false reference price.

In May, 2016, Macy’s allegedly first offered for sale online a “Giani Bernini Large Cross Pendant Necklace in Sterling Silver,” with an “original price of $120 and a sale” price of $30.  However, the purported “original” price of $120 allegedly was a false reference price.

In April, 2016, Sears allegedly first advertised online a Kenmore washing machine with a “regular” price of $1,179.99 and a “sale” price of $999.99.  However, the purported “regular” price was a false reference price.

 

—City News Service

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