Spokeo class action alleges company uses false reference pricing to entice customers

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Spokeo class action:

• Who: Two Spokeo customers are suing the online retailer.
• Why: The plaintiffs say the company advertised false discounts on its website to entice customers. 
• Where: The Spokeo class action was filed in a California federal court.

Spokeo has a deceptive business practice of advertising fictitious sales that deceive customers into thinking they’re getting a deal when they’re not, a new class action lawsuit alleges.

Plaintiffs Jesus Osuna and Dana Flory filed the class action lawsuit against Spokeo Inc Oct. 6 in a California federal court, alleging violations of California consumer and business laws.

According to the lawsuit, Spoke is guilty of false reference pricing. False reference pricing occurs when a seller fabricates a false “original” price for a product and then offers that product at a substantially lower price under the guise of a sale, the plaintiffs state.

“The resulting artificial price disparity misleads consumers into believing the product they are buying has a higher market value, and it induces them into purchasing the product,” they say, adding that the practice also artificially inflates the true market price for these products.

“Consequently, false reference pricing schemes enable retailers, like Defendant, to sell products above their true market price and value—and consumers are left to pay the price.”

Spokeo continues to use illegal sales tactic, lawsuit alleges

Through its alleged false and misleading marketing and pricing scheme Spokeo violated, and continues to violate, California law, which prohibits the advertisement of goods for sale discounted from false former prices, the plaintiffs say.

Spokeo commits the alleged violations to take advantage of consumers’ lack of knowledge about the real market price of items, they say.

“Sellers, including Defendant, understand consumers are vulnerable to perceived bargains. Thus, Defendant has a substantial financial interest in exploiting consumers’ well-known behavioral tendencies by inducing consumers into believing they are receiving a bargain—even when they are not.”

The plaintiffs are looking to represent anyone who made a purchase from spokeo.com at discounts from an advertised reference price, and who have not received a refund or credit for their purchase.

They are suing for violations of California consumers laws including California Unfair Competition Laws and False Advertising Laws, and are seeking certification of the class action, damages, fees, costs and a jury trial.

Meanwhile, consumers have recently made false reference pricing claims against numerous companies including The Children’s Place, Pier 1, Dress Barn, and Zales, among others.

Did you buy a discounted item from Spokeo? Let us know your experience in the comments! 

The plaintiffs are represented by Todd D. Carpenter and Scott G. Braden of Lynch Carpenter, LLP.

The Spokeo class action lawsuit is Jesus Osuna et al., v. Spokeo Inc et al., Case No. 2:22-cv-07310 in the U.S. District Court for the Central District of California.

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