Michael Kors Settles Class Action Over Imaginary Outlet Prices

This is a regular Michael Kors store, where outlet items would never have been sold. (Mike Mozart)

This is a regular Michael Kors store, where outlet items would never have been sold. (Mike Mozart)

Outlet shoppers know the drill: items are marked with a “Manufacturer’s Suggested Retail Price,” and then an outlet price. What does that mean when you’re shopping at the Michael Kors outlet, and the merchandise is all made for the outlet? That makes the suggested price meaningless, and is exactly what a recent class action suit against the fashion company alleged. The suit has been settled, and the fashion company has agreed to pay consumers a total of $4.88 million to make up for years of imaginary price tags.

If you shopped at a Michael Kors outlet between July 25, 2010 and July 25, 2014, you’ll be eligible for this class action settlement. What the suit alleges is what most outlet shoppers know on some level: the “original” prices on tags in Michael Kors outlets were just made-up numbers, and those items were never sold for the original price in department stores or elsewhere.

The company has agreed to replace the “MSRP” on their tags with “Value,” suggesting that the same item could sell for the higher price somewhere else, even if it never actually would be.

Michael Kors settles U.S. lawsuit alleging deceptive price tags [Reuters]