Burberry faces U.S. lawsuit accusing it of deceptive price tags

LONDON (Reuters) – British luxury fashion brand Burberry is to face a class action lawsuit in the United States, claiming it used misleading price tags at its outlet stores to fool shoppers into believing the goods were being sold at a hefty discount.

The company, which manufactures some of its products specifically for its outlet stores, is accused of intentionally presenting false price information on products that have never been sold in its retail stores.

Burberry, which is famous for its trench coats and cashmere scarves, said on Friday that it is committed to dealing with all its customers in a transparent and fair manner, including pricing across the business.

“All pricing policies and practices are designed to ensure compliance with applicable laws and local practices,” the company said in a statement.

“Burberry will be contesting this lawsuit but will not comment further while proceedings are under way.”

Outlet stores typically sell excess or old stock at a discount, though some retailers also manufacture goods specifically for outlet operations.

The lawsuit is the latest in a long line of cases accusing luxury retailers of marking up goods sold in outlet stores with made-up manufacturer prices.

Last year U.S. retailer Michael Kors agreed to pay $4.88 million and change its sales practices to settle a similar class action lawsuit after it was accused of creating an “illusion” of deep discounts.