La-Z-Boy Hit with Class Action Lawsuit: Did Fake Discounts Dupe Furniture Shoppers?

Imagine walking into a furniture store, believing you're scoring a fantastic deal on a new couch, only to discover later you may have been tricked. That's the scenario a California man is alleging against furniture giant La-Z-Boy, accusing the company of using "fake discounts" to mislead customers on Joybird furniture purchases.

The lawsuit, filed by California resident Jeffrey Jacobs, targets La-Z-Boy Incorporated, the parent company of the popular furniture brand Joybird. Jacobs claims La-Z-Boy engaged in a deceptive pricing scheme on Joybird's website (joybird.com) and in their retail stores.

According to the lawsuit, La-Z-Boy advertised furniture at significantly marked-down prices, but these discounts were allegedly based on inflated "original" prices that customers never actually paid. This practice, known as "deceptive reference pricing," can mislead consumers into believing they're getting a much steeper discount than is truly the case.

Holding La-Z-Boy Accountable for Deceptive Pricing

Jacobs says he is looking to hold the multimillion dollar company accountable to its customers for what the lawsuit describes as "a yearslong campaign to trick customers into paying more" for Joybird products. He argues that La-Z-Boy's alleged deceptive pricing tactics manipulate consumers' perception of value, leading them to overpay for furniture.

The lawsuit details Jacobs' experience purchasing a sectional sofa and chairs at a Joybird retail store in Los Angeles. He believed he was receiving a substantial 40% discount based on the advertised price. However, the lawsuit contends that the discount was likely misleading, with the "original" price being artificially inflated to create a more significant-looking discount.

“His belief that the discounted prices on the items was limited and would not last was material and integral to his purchase decision,” the lawsuit says. 

He argues that false reference pricing schemes enable retailers to sell products above their true market price and value, leaving consumers to pay the inflated price regardless of what they thought of the purported discount. 

 “But the promised savings are false, and the product’s value reflected in its price is incorrect when the retailer advertises discounts off of some higher, made-up, and artificially inflated ‘original’ price that no one ever pays,” Jacobs states.  

Understanding Deceptive Pricing Tactics: How to Spot Fake Sales

Deceptive pricing tactics can take various forms, often designed to pressure consumers into making quicker purchase decisions. Here are some common examples:

• Temporary Price Increases: Retailers might temporarily raise prices before marking them down to create a sense of urgency and a "limited-time offer."
  
  
• Fake Scarcity: Some retailers might create a sense of limited stock or limited-time discounts to pressure customers into buying before items "run out."

The Federal Trade Commission (FTC) prohibits deceptive pricing, but enforcement often falls to individual states.

La-Z-Boy Joins Growing List of Retailers Facing Deceptive Pricing Lawsuits

La-Z-Boy is not the only company facing deceptive pricing claims. Last month, online marketplace Temu was hit with a class action lawsuit alleging it deceives shoppers with "fake sales" and misleading discounts. J.C. Penney is also facing a class action lawsuit in California alleging the company uses “false reference pricing schemes.” 

Purple was also slapped with a class action for allegedly creating fake sales over their mattress products. Old Navy reached a settlement in 2021 after it was accused of falsely inflating prices.

Jacobs is seeking class action certification in the lawsuit, which could allow him to represent other California residents who believe they were misled by La-Z-Boy's pricing practices on Joybird furniture. The La-Z-Boy deceptive pricing class action lawsuit seeks damages, fees, and a jury trial.

Case Details

• Lawsuit: Jacobs v. La-Z-Boy Incorporated
• Case Number: 2:24-cv-04446
• Court: U.S. District Court for the Central District of California

Plaintiffs' Attorneys

• Todd D. Carpenter, Scott G. Braden, and James B. Drimmer (Lynch Carpenter LLP)