JCPenney has been a mainstay in American retail for more than a century now. Despite its long history, the clothing retailer has struggled for relevancy recently, like most mall staples. But even as JCPenney works to make proactive changes under new leadership, some shoppers are calling the company's practices into question. Now, JCPenney is under fire for allegedly "tricking customers" with "misleading" discounts. Read on to find out more about the new lawsuit that's been filed against the company.
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JCPenney has been working on a comeback.
ShuttestockAfter working with brands like Walmart and Levi's, Marc Rosen took over as JCPenney CEO in 2021. In a Nov. 2022 interview with CNN, Rosen said he "did not have any personal hesitancy at all" about trying to revitalize the 120-year-old retailer—making it clear he envisioned a comeback for JCPenney.
"I believe in taking on large scale transformation. There was an opportunity to really take this brand and make it relevant again," he told CNN, noting that his comeback plans are centered around appealing to "America’s diverse working families."
Under Rosen's leadership, JCPenney has remodeled stores, improved its technology and online experience, and added new major brands, private-label clothing, and home furnishings labels, according to the news outlet. But when it comes to cost, certain shoppers may feel like they're being misled—and now one customer has filed a lawsuit.
A customer is suing the retailer over "misleading" discounts.
ShutterstockOn Feb. 13, plaintiff Maria Carranza filed a class action suit against J.C. Penney Co. Inc in the U.S. District Court for the Southern District of California. Carranza claims that JCPenney is engaging in a "false reference pricing" scheme through its online marketplace.
"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 lawsuit explains.
In other words, JCPenney is allegedly advertising fake original prices for products on its website, so that its sale prices appear better than they actually are, according to Carranza.
Best Life reached out to JCPenney about the lawsuit, but has not yet heard back.
The lawsuit claims that JCPenney is "tricking consumers."
ShutterstockCarranza alleges that JCPenney is violating California’s False Advertising Law, Consumers Legal Remedies Act, and Unfair Competition Law by advertising "misleading" discounts on its website.
According to the lawsuit, the retailer is listing sale prices for apparel, footwear, accessories, jewelry, home furnishings, beauty products, and other related items online alongside higher prices marked with a "strikethrough." This suggests to customers that JCPenney "previously offered their products at the strikethrough price"—but Carranza says that the items were never actually sold at these prices.
"It is well-established that false reference pricing violates state and federal law," the lawsuit states. "Even so, sellers, including [JCPenney], continue to use the tactic because they know they will be able to increase sales and profits by tricking consumers into making purchasing decisions based on the advertised reference prices."
Carranza says she only bought one item because of its "discount."
ShutterstockCarranza wants to stop JCPenney from engaging in false reference pricing, and seeks to collect damages for those who have "purchased products tainted by this deceptive pricing scheme."
The plaintiff purchased a Cooks 2 Quart Air Fryer from JCPenney's online website on Sept. 14, 2022. She claims that air fryer's original price was listed as $60 with a strikethrough, and accompanied by a sale price of $39.99.
"[Carranza] believed she was receiving a significant discount on the product she had chosen," the lawsuit explains. "Because she was interested in the product and felt that the discounted price would likely not last, and that she was getting a significant bargain on the product, [Carranza] proceeded to finish checking out and purchased it."
But the air fryer was never actually sold for $60 on JCPenney's website, according to the lawsuit. And Carranza said she would not have bought it if the discount hadn't appeared so substantial.
