CALABASAS, Calif. (Legal Newsline) – Fictitious pricing lawsuits, like the
one filed recently against Harbor Freight Tools USA by a class of customers
“appear to be trending,” according to TruthinAdvertising.org executive director Bonnie Patten.
“As of June 2016, TINA.org is tracking 61 federal class-action lawsuits involving fraudulent discount pricing claims involving 43
different retailers,” Patten told Legal Newsline. “Of these cases, 25 were filed in 2015; and in the first six months of
2016, nearly the same number of cases (24) have been filed.”
The class action suit filed against Harbor Freight on May 20
by Ted Shimono and other similarly situated plaintiffs in U.S.
District Court for the Central District of California alleges that the company
is deceiving its customers by advertising sale prices that are based on
fictitious regular prices for the items in question. The lawsuit alleges that
Harbor Freight is, as a result, selling low-quality products at artificially
According to the lawsuit, Harbor Freight advertised tools,
equipment, accessories and other products through a “deceptive and misleading
pricing campaign” at the point of purchase and through mailed and distributed
flyers, catalogs, circulars, in-store displays, web pages, emailed offers and
“In many of (Harbor Freight’s) retail outlets, the
fictitious discount price scheme is prominently displayed throughout the store,
advertising supposed deep discounts on essentially every single item of
inventory sold in the store,” the lawsuit said.
The plaintiffs also said there is no comparable price for
many of the products sold by Harbor Freight, which sells name-brand and
house-brand merchandise, other than prices the company itself set.
The lawsuit claims Harbor Freight’s advertising practices constitute
deceit by suppression of facts and violate the California Consumers Legal
Remedies Act, the state’s Unfair Competition Law and its False Advertising Law.
Harbor Freight did not respond to requests for comment on
While the majority of cases that TINA.org is presently
tracking are pending or on appeal, Patten said many of these pending class
actions are facing motions to dismiss.
“Based on current TINA.org statistics from similar
fictitious pricing cases, it appears likely that the biggest challenge for
plaintiffs in the Harbor Freight Tools USA case will be defeating a motion to
dismiss, which inevitably will be filed by the defendant,” Patten said.
Patten said fictitious pricing exploits consumers’ desire to
obtain a bargain, and means that consumers may pay more for a good or service than
they may have if they continued to seek a lower price on the same merchandise. Patten said the court does not always agree, however.
“Many deceptive pricing complaints are successfully
challenged by retailers as not providing the factual specificity necessary to
state a claim, including detailing the consumers’ economic harm,” Patten said.
As an example, Patten cited a recent case against Kohl’s
Department Stores, which is currently on appeal, in which a Massachusetts
federal court granted the company’s motion to dismiss because “(the) fact that
plaintiff may have been manipulated into purchasing items because she believed
she was getting a bargain does not necessarily mean she suffered economic