New Class Action Claims Hobby Lobby Advertises Fictitious 'Discount' Prices

Hobby Lobby Stores, Inc. is the defendant in a proposed class action lawsuit alleging the company advertises fake prices and “corresponding phantom discounts” for its branded and/or trademarked merchandise. The suit claims that, as a result, consumers are misled into paying sham prices for items they wrongly believe are on sale at a deep discount.

What does the lawsuit allege?

At 58-pages deep, the lawsuit out of California federal court is quick to note that state law prohibits Hobby Lobby’s allegedly deceptive business practice, and labels the arts, crafts, and hobby supply store’s supposed conduct as an outright lie to bargain-hunting consumers.

“The Hobby Lobby branded and/or trademarked merchandise is never offered for sale, nor actually sold, at the represented ‘marked’ price. Thus, the ‘marked’ price is false and is used exclusively to induce consumers into believing that the merchandise was once sold at the ‘marked’ price and from which the false discount and corresponding ‘___% OFF’ price is derived,” the lawsuit details. “Hobby Lobby’s deceptive pricing scheme has the effect of tricking consumers into believing they are receiving a significant deal by purchasing merchandise at a steep discount, when in reality, consumers are paying for merchandise at its regular or original retail price.”

The plaintiff aims to not only stop Hobby Lobby, the largest privately owned arts-and-crafts retailer in the world, from engaging in its allegedly unethical and deceptive conduct, but to “correct the false and misleading perception” the lawsuit argues the company has planted in consumers’ minds about its merchandise.

What does the plaintiff say happened?

The San Diego woman behind the complaint says she bought a five-inch by seven-inch picture frame for roughly $8.99 and an oil, acrylic and watercolor chisel blender for around $2.34 at a La Mesa Hobby Lobby store. According to the complaint, the frame was purportedly marked down as previously sold for $17.99, which led the plaintiff to believe she “was purchasing a picture frame that had a value significant higher than the $8.99 purchase price.” For the paint chisel, the lawsuit continues, the plaintiff noted its white price tag marked as $4.69.

While it looked on the surface that the plaintiff was getting a decent bargain for the products, the lawsuit alleges that, in truth, neither product was never offered for sale or sold at their white-sticker, in-store price within the 90-day period immediately preceding the plaintiff’s purchase.

“However, at no time is the Hobby Lobby merchandise ever offered for sale anywhere at the ‘marked’ price,” the lawsuit reads. “The ‘marked’ price is merely a false reference price, which Hobby Lobby utilizes to deceptively manufacture a deeply discounted sale price referred to as the ‘___% OFF’ price on the merchandise sold at the Hobby Lobby retail stores during the class period.”

Noting that consumers can unfortunately be susceptible to a good bargain, the case claims Hobby Lobby takes advantage of this truism with its fraudulent scheme purporting heavy product discounts.

Who does the lawsuit hope to cover?

The proposed class outlined by the lawsuit includes anyone in California who bought one or more Hobby Lobby-branded and/or -trademarked products at purported discounts from the advertised “marked” price and who have not received a refund or credit for the purchase.