Deceptive Price Tags Lead to Lawsuit

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As the holidays approach, it is important that consumers shop smart and save. Thousands of bargain hunters flood the outlet malls, in search of major savings. A recent lawsuit against Kate Spade and Company alleges that the store has been advertising a fake original price. They are forging these “retail” prices so that consumers believe they are getting a deep discount on those products when, in reality, they are not. Kate Spade and Company operates 97 boutiques and 62 outlet stores in the United States, which sell high-end handbags, clothing, and accessories. According to this class action lawsuit, “Kate Spade misrepresented the existence, nature and amount of price discounts to consumers in its outlet stores.” The store marked “our price” as a fabricated value, encouraging eager shoppers to believe they were catching a great steal.

Plaintiff Gaylia Pickles purchased a handbag from the Kate Spade outlet store in Commerce, CA in July of 2015. The store was advertising a 50% discount on all merchandise, with an additional 20% off on handbags, including the bag Pickles purchased. Kate Spade’s “our price” was listed as $355. Given both discounts, Pickles paid $142 for the handbag. This lawsuit alleges that market price for this particular Kate Spade handbag was $142. The plaintiff stated that she would not have purchased the bag if she had known the true pricing. In a similar encounter in July, plaintiff Donna Vandiver went to the Kate Spade in New Braunfels, TX. She purchased a handbag originally marked at $275 and a wallet at $145, because they were both marked 50% off.  According to the lawsuit, if she was aware that she had paid the actual retail price for the items, she would not have bought them.

The lawsuit notes that, due to the misleading price tags, Kate Spade is in violation of California and Texas consumer protection laws. The two plaintiffs are seeking to represent a class of all persons who purchased handbags or wallets with a 20% discount or greater in the last four years in either Texas or California Kate Spade Outlet Stores. The lawsuit is designed to obtain damages for Class Members, and to end the “deceptive” nature of Kate Spade’s outlet prices.

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