Antitrust Law Daily Wrap Up, ADVERTISING NEWS: Sears charged with falsely advertising “phantom markdowns”, (Aug 28, 2015)

By Greg Hammond, J.D.

A consumer has filed false advertising and consumer protection claims against Sears Roebuck & Co., arising from allegedly false and misleading “original” prices, “sale” prices, and corresponding “phantom markdowns” on merchandise sold in stores and online. The complaint was filed in the federal district court in San Diego, California (Teperson v. Sears Roebuck & Co., August 26, 2015).

JoshuaTeperson is a San Diego resident who alleges that he purchased nearly $4,000 in merchandise through Sears’ website in November 2014. He claims that Sears continually misled consumers by advertising merchandise at discounted “sale” prices, comparing those prices to false “original” or “regular” retail prices. As a result, the advertised discounts were artificially inflated and did not actually represent a bona fide price at which Sears formerly sold the merchandise, representing nothing more than mere phantom markdowns, Teperson asserts. The deceptive pricing scheme was purportedly conveyed to consumers through Sears’ website and online promotional materials, as well as in-store displays and print advertisements.

The seven count complaint alleges violations of the fraudulent, unlawful, and unfair prongs of California’s Unfair Competition Law (UCL), as well as violations of California’s False Advertising Law (FAL), Consumers Legal Remedies Act (CLRA), the consumer protection laws of 40 states, and a claim for unjust enrichment.

Teperson seeks to represent a class consisting of all persons who purchased one or more items offered at a purported discount from an “original” or “regular” any time between August 26, 2011, and the date of certification. In addition, he seeks an award of damages; restitution and disgorgement of all profits and unjust enrichment; declaratory and injunctive relief prohibiting Sears from continuing its allegedly unlawful practices; a corrective advertising campaign; and attorney fees and costs.

The case number is 3:15-cv-01892-L-DHB.

Attorneys: John T. Jasnoch (Scott + Scott LLP), Todd D. Carpenter (Carpenter Law Group), Gary F. Lynch (Carlson Lynch Sweet & Kilpela, LLP), and E. Kirk Wood (Wood law Firm, LLC) for Joshua Teperson.

Companies: Sears Roebuck & Co.

News: Advertising ConsumerProtection CaliforniaNews