A federal appeals court today tossed a lawsuit by a woman who claimed Nordstrom Rack owed her lots of money because of what she said was a bogus "compare at" price on the $49.97 sweater she bought at its Boylston Street store in 2014.
In a lawsuit originally filed in state court, Judith Shaulis said she never would have bought the sweater had she known it didn't originally sell for $218, as alleged on its price tag and so the chain fraudulently induced her to buy it by promising her savings of 77%. In fact, she charged, she never would have even traveled to the store had she known that and so part of her damages should include her travel costs to and from the store.
The US Court of Appeals for the First Circuit agreed it would be wrong for Nordstrom Rack to say the sweater originally went for $218 if it didn't. But that was the only thread in Shaulis's action the court agreed with.
Taking its cue from the Massachusetts consumer-protection law and recent decisions by Massachusetts courts, the justices upheld a 2015 decision by a federal judge to dismiss the case - in which Shaulis had also asked to be named lead plaintiff in a class action - because Shaulis did not prove she suffered actual harm from the sweater purchase.
The court said the sweater was not poorly made and Nordstrom Rack didn't try to disguise it as an offering from a fancy-shmancy designer. The court added that the store did not break a contract with her, because it said it would sell her that sweater for $49.97, and it did.
Shaulis's alleged "injury" is only that Nordstrom tricked her into believing that she was getting a bargain, and not ... that the product itself was deficient in some objectively identifiable way. That perceived adverse impact -- as the district court put it, "the subjective belief as to the nature of the value [Shaulis] received" -- does not state a legally cognizable economic injury under Chapter 93A [the state consumer-protection law] because it fails to identify anything objective that Shaulis bargained for that she did not, in fact, receive.
The court did agree that stores should not make up bogus "compare at" prices, but said that Shaulis's remedy for that should have been a complaint to the state Attorney General's office, which does have the power to heavily fine stores found making false claims like that.