J. C. Penney’s Discounts
In December 2016, a class-action lawsuit was filed against J. C. Penney for allegedly falsely advertising discounts by marking up the prices of products in order to make its “discounts”…
October 2016: A Notice of Appeal regarding the district court’s decision to approve the settlement was filed. (Case No. 16-56474, 9th Cir.)
November 2015: Plaintiffs moved for preliminary approval of a settlement of this class-action lawsuit. According to the proposed settlement terms, class members may receive a cash payment or a store credit. The amount of these awards, which will be based on a point system, will compensate class members proportionally based on the amount each one spent at the store. After other costs and expenses (e.g., notice and administration costs and attorneys’ fees) are paid, any money remaining in the $50 million settlement fund as a result of uncashed settlement checks will be distributed to a (French for “as near as possible”): a legal doctrine that requires a judge to consider the manner in which unclaimed settlement funds in class action lawsuits are distributed. Under this doctrine, the remaining funds must be distributed for the indirect benefit of the class instead of benefiting the defendant. recipient, the National Consumer Law Center. In addition, J.C. Penney agreed to, among other things, make changes to its price-comparison advertising and take steps to ensure that such advertising complies with the law.
March 2015: A federal judge gave a false advertising class-action lawsuit against J.C. Penney the green light to move forward. The complaint, which was originally filed in 2012, alleges that the store uses a “false price advertising scheme” in order to misrepresent the amount of discounts. According to the plaintiffs, the store misleadingly represents the “original” retail prices when, in reality, these prices never existed and do not represent the prevailing market retail prices for the products within the three months immediately before the advertisement, as required by California law. (Spann et al v. J.C. Penney Corporation, Inc., Case No. 12-cv-215, C. D. CA.)
For more information about the misleading advertising of discounts and TINA.org’s coverage of the issue, click here.
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Lawsuits claim original prices to which sale prices are compared have no basis in reality.