4 Big Retailers Sued Over Alleged Deceptive Ads
LOS ANGELES (KDKA) - It's that time of year when almost every store tries to lure you in with claims of slashed prices -- you know, 50 percent off the original price!
But did that product ever sell in a store at the original price?
"Never, never. It's a business. You got to make money," says Pat Valenti of Cranberry.
"Do you think some stores sometimes create a fake original price?" KDKA money editor Jon Delano asked one shopper.
"Definitely. Definitely," says Denise Seibel of Robinson.
Now Los Angeles prosecutors have accused four major retailers of doing just that -- Penney's, Sears, Macy's and Kohl's.
"We sued four of the nation's leading retailers on behalf of the people of the state of California, and we allege that each has engaged in a practice called false reference pricing," says Los Angeles city attorney Mike Feuer.
It's called false reference pricing, creating a fictitious original price in order to mark it down by, say, 50 percent or 75 percent, to mislead customers into thinking they're getting significant discounts on store items.
"We're talking thousands of products," says Feuer, who says it's not isolated to his state.
"I'm hopeful that our lawsuit here will similarly have an effect that goes well beyond California's borders."
Pennsylvania Deputy Attorney General Jess Harvey has no doubt it does.
Delano: "Does this happen in Pennsylvania?"
Harvey: "I am sure this happens in Pennsylvania."
Harvey says he has no specific information about these four retailers, but the practice is illegal in this state, too.
"Consumers need to be given honest information so they can make informed choices."
Harvey says the AG's Bureau of Consumer Protection would welcome any local complaints about this pricing scheme.
"It gets it on our radar. It will be looked at. we'll discuss it. Sometimes it will lead to investigations or legal actions, so we're dependent on folks letting us know what's out there," says Harvey.
Sears, Kohls, and Penney's say they don't comment on litigation.
No response yet from Macy's.
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