Ralph Lauren Class Action Alleges Fake Discounts at Polo Outlets

A class action lawsuit accuses Ralph Lauren of using a deceptive pricing scheme at its Polo Factory Outlets, where items are advertised as discounted but were never actually sold at the higher reference price.

Consumers Affected: Consumers who shopped at Polo Factory Outlets and purchased items they believed to be on sale.

Reason for Lawsuit: Allegations of false advertising, deceptive marketing practices, and violations of California and federal laws, leading consumers to overpay for products.

Court: The class action lawsuit was filed in the U.S. District Court Southern District of New York.

Ralph Lauren’s Polo Factory Outlets are known as a place where you can get the fashion giant’s clothing at a discounted price, but according to a new lawsuit that price might not be so discounted after all. 

Consumers are accusing the fashion giant of using a fake discounting scheme “that harms consumers” at the outlet stores, whereby the company advertises items are on sale but they were never really sold at the higher reference price. 

Customers have been deceived by the years-long campaign, which has tricked them into paying more for Ralph Lauren’s Polo Factory Store outlet items, while also violating California and federal laws through false and misleading marketing and advertising, the lawsuit alleges. 

Lawsuit Claims Discounts at Polo Factory Outlets Are a Sham

Sarah Ratra filed the proposed class action lawsuit against Ralph Lauren, accusing it of misleading consumers including herself. She says that in April she purchased numerous items from a Polo Factory Outlet in California believing they were on sale and being sold at a lower than usual price. 

However, she discovered that wasn’t the case. According to her lawsuit, Ratra’s lawyer had been investigating Polo Factory outlet stores across the country since February 2022 and found the pricing scheme “was uniform and identical across all stores visited” with items perpetually claiming to be discounted by a certain percentage.

Ratra said if she knew about the scheme and the fact she wasn’t getting a bargain, and was in fact paying an inflated price, she wouldn't have made her purchases. “As a result, Plaintiff has suffered economic injury as a direct result of Defendants’ unlawful, unfair, and fraudulent conduct.”

Ralph Lauren Accused of Manipulating Consumer Perception to Inflate Prices

Fake discounting schemes are commonplace in the US retail market, but that doesn’t make them legal. As per the lawsuit, false advertising of prices manipulates consumers’ value perception of products and causes consumers to overpay for them. Retailers take advantage of that buying decision process and price, and advertise discounts that promise huge savings and high value. 

“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,” the lawsuit states.

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 discount, such as the case in this lawsuit. The price disparity misleads consumers into thinking the product has a higher market value, and pushes them into purchasing the product. 

“This practice artificially inflates the true market price for these products by raising consumers’ internal reference price and in turn the perceived value consumers ascribe to these products,” according to the lawsuit.

Fake Discounting Scheme a Common Tactic in Retail Industry

Ralph Lauren isn’t the only company accused of using the practice to trick consumers into purchases. Women's fashion retailer Torrid was accused in a class action lawsuit of tricking customers into believing they're getting deep discounts on clothing that was never actually sold at a higher price — much in the same way Ralph Lauren is being accused.

JC Penney was also slapped with a similar class action lawsuit, accused of misleading customers with deceptive sales. And, in March, the spotlight shifted to online mattress seller Purple, with a lawsuit alleging they tricked customers into thinking they were getting a steal, when in reality they were paying full price.

Foot Locker also got backlash from consumers in a class action in July 2023. The New York lawsuit accused them of creating false urgency by warning customers that items were about to sell out. This tactic allegedly pressured customers into impulse purchases.

In the Ralph Lauren fake discounts class action lawsuit, Ratra wants to represent California consumers who have shopped at Polo Factory Outlets and been a victim of the false sale scheme. She is seeking monetary damages, restitution, and declaratory and injunctive relief from Ralph Lauren.

Case Details

• Lawsuit: Sarah Ratral v. Ralph Lauren Corporation, et al.
• Case Number: 1:24-cv-04816 
• Court: U.S. District Court Southern District of New York 

Plaintiffs' Attorneys

• Gary F. Lynch, Todd D. Carpenter, and Scott G. Braden (Lynch Carpenter