US court allows deceptive pricing claims against Hollister to proceed

A US district court has denied attempts by Abercrombie & Fitch, operating as Hollister, to compel arbitration in a consumer lawsuit alleging deceptive pricing practices, allowing the case to move forward as a potential class action.

The lawsuit, filed with the US District Court of the Southern District of California, centres on claims that Hollister misled consumers through “strike-through” pricing on its website, displaying higher reference prices that allegedly did not reflect genuine prior prices.

The plaintiff, Rebeka Rodriguez, purchased a T-shirt for 6.99 dollars that was advertised as discounted from 14.95 dollars, arguing that the higher price was artificially inflated to create the appearance of a deal.

The complaint was brought under California consumer protection laws, including false advertising and consumer remedies statutes, and seeks to represent a broader class of shoppers who purchased discounted items under similar conditions.

In its ruling, the court rejected the retailer’s effort to move the dispute into arbitration, finding that customers were not given sufficiently clear notice that completing a purchase would bind them to arbitration terms. As a result, the court also denied motions to dismiss the class claims and to stay the proceedings.

The decision keeps the focus on the underlying allegations of deceptive pricing, a practice that has faced increasing scrutiny across the retail sector. Cases typically determine whether reference prices reflect actual, recent selling prices or are used primarily as a marketing tactic to drive conversions.

With arbitration denied, the case against Hollister will proceed in court, potentially increasing legal exposure for the retailer and adding to ongoing regulatory and legal pressure around promotional pricing transparency in e-commerce.