Rue La La Gift Certificate Class Action Lawsuit

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A new class action lawsuit has been filed against the members-only shopping site Rue La La, alleging that the company sells gift certificates with deceptive and illegal expiration dates.

The plaintiff, Liah Mirabella, accuses Boston-based Rue La La of violating a federal law that requires gift cards and gift certificates to last for a minimum of five years, or a Massachusetts law which requires they remain active for seven years. She is seeking to represent as many as 7.5 million Rue La La members.

Mirabella filed the class action lawsuit after a gift certificate to a personal fitness training center expired before she had the chance to use it. On July 5, 2012, she purchased a $59 voucher for private training services at Personal Fitness in Boston. The voucher expired on October 31, 2012, before she was able to use it. She is seeking unspecified financial damages.

On Rue La La’s private sale website, the company offers its members reduced prices for certain services and products. These deals are only offered for a very brief period of time in order to pressure customers to purchase the gift certificates. Once a member purchases a gift certificate, it is emailed to the purchaser. According to the Rue La La class action lawsuit, members “feel pressured and are rushed into buying the gift certificates and unwittingly become subject to the onerous sales conditions imposed by Defendant Rue La La, including illegal expiration terms that are unconscionably short — often just a few months.”

The expiration dates on the gift certificates often expire within a few months of the purchase date. In the class action lawsuit, Mirabella complains that this early expiration date means that many purchasers fail to take advantage of their purchase before the gift certificate expires. As a result, Rue La La experiences a significant windfall.

The plaintiff in the class action lawsuit admits that Rue La La changed it expiration date policy sometime after July 2012 to differentiate between the paid and promotional values of the gift certificates. Under the new policy, the full price value of the gift certificate would last five years while the promotional value would expire on the earlier date indicated on the gift certificate. This change was likely made in order to comply with state and federal law.

Mirabella filed the class action lawsuit in the U.S. District Court for the District of Massachusetts. She is seeking certification of a class of Rue La La members who purchased or acquired a gift certificate with an illegal expiration date.

Rue La La’s business model is similar to that of Groupon and Living Social, companies which have also recently been targeted by class action lawsuits. The $8.5 million Groupon class action settlement, which had been dismissed, was reinstated in December 2012. Earlier this year, a federal judge approved a $7.5 million Living Social class action settlement.

The Rue La Law Class Action Lawsuit case is Leah Mirabella v. Rue La La Inc., et al., Case No. 13-cv-11392, in the U.S. District Court, District of Massachusetts.

UPDATE: A federal court preliminarily approved a class action lawsuit settlement in this case in November 2014. Here’s how to file a claim for the Rue La La class action settlement to receive a refund of your qualifying voucher purchase(s).