Men’s Wearhouse Class Action Challenges Late Return Fees

The Men’s Wearhouse Inc. and its successor company Tailored Brands Inc. were hit Monday with a class action lawsuit alleging they impose late return fees that are void and unenforceable under California law.

The Men’s Wearhouse rents formalwear such as suits, vests, tuxedos, shoes, shirts, pants, ties and other clothing and accessories to customers.

Customers who wish to rent formalwear must enter into a rental agreement, which imposes a late return fee of $20 per day when a customer returns a garment after the scheduled due date.

Plaintiff Anthony Smith claims these Men’s Wearhouse late fees are void and unenforceable under California law. The Men’s Wearhouse class action lawsuit also alleges the late fees are unlawful under California’s Unfair Competition Law and unconscionable under the state’s Consumers Legal Remedies Act.

Smith claims he rented formalwear from California Men’s Wearhouse stores in August 2016 and entered into the company’s rental agreement.

According to the Men’s Wearhouse class action lawsuit, the late return provision in the rental agreement states: “Late fee will be accrued daily and charged in a lump sum, upon the receipt of the late garments, up to the full replacement cost of the applicable garment. If a garment is returned more than 21 days late, customer will be charged the full replacement cost.”

Smith says he paid multiple late fees pursuant to this agreement.

The late fees constitute impermissible liquidated damages provisions under California law, the Men’s Wearhouse alleges. Smith argues that the $20 fee is unrelated to any potential harm Men’s Wearhouse might suffer from the late return, and that the late fee constitutes an impermissible contractual penalty.

Further, Men’s Wearhouse “intentionally, knowingly, and unlawfully perpetrated harm” upon Smith and putative Class Members by including the unenforceable late fee provisions in the rental agreements, Smith alleges.

“The gravity of the harm to all consumers from Defendants’ policies and practices far outweighs any purported utility those policies and practices have,” the Men’s Wearhouse class action lawsuit says.

Smith also says the Men’s Wearhouse late fees are “unconscionable” because customers do not have a meaningful choice about the inclusion of the late fees or the amount of the fee.

“The Late Fees are unreasonably favorable to Defendants and unduly harsh with respect to Defendants’ customers, and therefore, are substantively unconscionable,” Smith says in the Men’s Wearhouse class action lawsuit. “For example, the Late Fees have no relationship whatsoever to any damages incurred by Defendants, if any, as a result of late returns by customers.”

The Men’s Wearhouse class action lawsuit was filed on behalf of Smith and a proposed Class of consumers who paid one or more late fees imposed by Men’s Wearhouse pursuant to the rental agreement entered into at a Men’s Wearhouse location in California.

Smith is represented by Scott A. Bursor, L. Timothy Fisher, Joel D. Smith and Yeremey O. Krivoshey of Bursor & Fisher PA, and by Frank S. Hedin and David W. Hall of Hedin Hall LLP.

The Men’s Wearhouse Late Fees Class Action Lawsuit is Anthony Smith v. The Men’s Wearhouse Inc., et al., Case No. 4:18-cv-02840-DMR, in the U.S. District Court for the Northern District of California.