Here's a nice summary of the opinion, courtesy of Justice Willhite:
"Plaintiffs . . . filed a
putative class action against Banana Republic, LLC, a clothing and
accessories retailer with stores throughout California, alleging that signs in
Banana Republic store windows advertising a 40 percent off sale were false
or misleading because they did not disclose that the discount applied only to
certain items. . . . In
opposition to Banana Republic’s summary judgment motion, plaintiffs
produced evidence that in reliance on the allegedly false advertising, they
were lured to shop at certain Banana Republic stores and selected various
items for purchase at the advertised discount. However, as the items were
being rung up at the cash register, plaintiffs were told for the first time that
the advertised discount did not apply to their chosen merchandise. Having
waited in line to purchase the selected items, and out of frustration and
embarrassment, they ultimately bought some (but not all) of the items they
chose even though the discount did not apply. The trial court granted
summary judgment in favor of Banana Republic, concluding that plaintiffs
lacked standing because they failed to raise a triable issue whether they
suffered injury in fact and lost money or property. In this appeal by
plaintiffs, we conclude that neither the ground cited by the trial court, nor
the other grounds raised in Banana Republic’s motion, support summary
judgment. Instead, we conclude that on the evidence presented, plaintiffs
raised a triable issue whether they lost “money or property sufficient to qualify as injury in fact, i.e., economic injury,” and whether “that economic
injury was the result of, i.e., caused by, the unfair business practice or false
advertising that is the gravamen of the claim.” (Kwikset Corp. v. Superior
Court (2011) 51 Cal.4th 310, 322 (Kwikset).) Therefore, we reverse the
judgment."
I'll also say that the underlying facts of the case seem to me to accurately describe how economic injury -- as well as unfair competition -- might well result from allegedly misleading "sale" signs.
Here's one of the plaintiff's story:
"Cherilyn DeAguero testified in her deposition that on November 7,
2010, she and her 14-year-old daughter were driving past a Banana Republic
store on Ventura Boulevard in Studio City. DeAguero saw a large red sign in
the store window stating in black letters “40 percent off.” She pointed it out
to her daughter, and they decided to stop and go shopping. Based on the 40
percent off discount, DeAguero thought she would be able to buy six to eight
outfits for her daughter, who required a variety of outfits for auditions in her
acting career. . . .
After shopping and trying on outfits for approximately 40 minutes,
DeAguero’s daughter chose eight pieces and wore one new outfit out of the
dressing room. They went to the register, and the sales clerk began ringing
up the items. DeAguero was talking excitedly with the customer behind her,
stating “This is great, 40 percent off.” The clerk told her the items she was
purchasing were not 40 percent off. DeAguero replied that the sign indicated
everything was 40 percent off, but the clerk said the discount did not apply to
the items she chose.
DeAguero became embarrassed, noticing that the line behind her was
getting long. She found the experience “humiliating,” because she was trying
to remain in a budget but did not want to make her daughter return to the
dressing room to remove the outfit she was wearing.
She became angry and asked the clerk why the store had “waste[d]
[her] time luring [her] in” and which items were 40 percent off. The clerk
explained that there were “selected items” throughout the store, even though
DeAguero did not see any signs in the store indicating those items.
DeAguero did not ask to speak with a manager because her daughter
was embarrassed and was whispering to stop. She ultimately purchased the
new items her daughter was wearing because she did not want to embarrass
her. She did not buy the other items because they were not 40 percent off."
That's a story that rings familiar -- or at least true -- to me. Even if you found out at the time that the items weren't 40 percent off, you might still buy them. If only out of shame.
Now, mind you, the price you paid for the items was still the price that was listed for them. That's in part why Justice Bigelow dissents.
I'll just mention in passing that people aren't always entirely rational. Or, to put it more accurately, we often make decisions based upon a series of assessments not all of which can be rationally set forth.
Many, many people will be more inclined to buy a $100 dress if that dress is labelled 40 percent off than they would were that same dress merely listed as $100. And the industry knows that full well. That's why "sales" are so popular. And productive.
Maybe the buyer is making an internal assessment that an $100 dress that originally sold for $167 is a made better -- with higher quality materials -- than a "mere" $100 dress. Maybe there's some internal joy from getting a "deal". Maybe there are other things at stake as well.
But having been around people who shop my entire life, I'm confident that "sales" work. They affect the buyers internal dynamic. They are persuasive. And I'd rather be in a world in which "sales" are in fact sales than in a world in which they're not.
Maybe that's irrational. But it's definitely a desire.
