JCPenney Hit with Class Action Over Alleged Use of False Reference Prices Online

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A proposed class action lawsuit alleges JCPenney has misled consumers by advertising products on its website with false “original” prices and corresponding illusory discounts, giving an impression of “deep discount” savings.

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The 26-page lawsuit claims that Old COPPER Company, Inc. and Penney OpCo—who do business as JCPenney—use false reference pricing to fool shoppers into thinking they are buying a product with a higher market value than it really has. In truth, however, the “deep discount[s]” seen on JCPenney.com are misrepresentations, as the items listed on the website are “never sold at the [original] price consumers are led to presume,” the suit charges.

“All while fully aware of their deception,” the case reads, “Defendants have achieved, and might continue to achieve, their ultimate, continuing purpose of driving sales with sham markdowns.”

Per the complaint, the defendants list products on their website with false “original” prices crossed out, implying that the products were sold previously at these “strikethrough” prices. The discount percentage appears in italics next to the sale price, which is displayed in red italics to draw the eye, the filing says.

According to California law, a retailer can only offer a discount on an item for 90 days, after which either the product’s price must revert back to its original cost, or the seller may maintain the discount provided that it discloses the date on which the original price was previously offered, the lawsuit explains. In addition, federal law requires a product’s advertised original price to have been in regular use by the retailer and for a reasonable amount of time, the case says.

The plaintiff, a California resident, purchased a Cooks-brand two-quart air fryer from JCPenney.com in September 2022, the suit relays. When she saw the original price of $60 crossed out next to the $39.99 sale price, the plaintiff believed she was getting a substantial discount, the complaint states.

Subsequent investigation by her legal counsel revealed that the air fryer had been listed under the same original and discounted prices for more than the 90-day period allowed by state law, the filing alleges.

What’s more, the investigation showed that the “false reference pricing scheme was uniform” across JCPenney.com and that, as of July 2022, more than 1,990 products listed on the website were discounted for periods beyond the 90 days permitted, the case claims.

The lawsuit looks to represent anyone who purchased from JCPenney.com one or more products at discounts from an advertised reference price and has not received a refund or credit for their purchase(s) during the applicable statute of limitations period.

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