Zara Gets Hit With a $5 Million USD Lawsuit for Allegedly Swindling Customers

The brand may need to keep better tabs on the euro to dollar exchange rate.

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Fashion
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From putative racial profiling to copying artist designs, Zara is no stranger to controversy. The Spanish retail giant seemingly has a knack for cause célèbre and this time it got smacked with a massive $5 million USD lawsuit for its alleged “deceptive pricing practices.” This past May, a man by the name of Devin Rose bought three shirts from a Zara store in Los Angeles, California. According to Us Weekly the lawsuit stated that “the actual euro-dollar exchange rate would have resulted in his €9.95 shirts costing approximately $11.26 each. Instead, however, Zara charged Mr. Rose $17.90 per garment, a markup of nearly 60%.”

Zara habitually prints euro prices rather than dollar amounts on its clothing tags and from Rose’s assertion, apparently the brand isn’t keeping tabs on the shifting exchange rates—causing confusion amongst customers who are presumably getting swindled due to the aforesaid statement. By the same token, Rose suspects that “behind its façade of attainable elegance, Zara is engaged in a widespread practice of deceiving American consumers through a classic bait and switch.”

Now, this is where the suit gets interesting: if approved, folks who ever bought falsely-priced garments from Zara can enter the case and split the settlement amount. According to The Fashion Law, Zara USA released a statement saying that it “denies any allegations that the company engages in deceptive pricing practices in the United States.” Having added:

While we have not yet been served the complaint containing these baseless claims, we pride ourselves in our fundamental commitment to transparency and honest, ethical conduct with our valued customers. We remain focused on providing excellent customer service and high-quality fashion products at great value for our customers. We look forward to presenting our full defense in due course through the legal process.

In response, Rose and his legal team said:

Zara’s response so far has been beyond bizarre and desperate. Their unlawful conduct is not up for debate, as anyone who goes into a Zara store in the United States can see with their own two eyes that Zara is pricing clothing in euros and charging consumers drastically above the lowest tag price in dollars which is illegal. U.S. laws require that a retailer charge the consumer the lowest tag price — not grossly inflated amounts using fake conversion rates. If Zara wants to double down on its duplicity, instead of acting like a responsible corporate citizen and fixing the mess of its own making, they should be prepared to face the wrath of the American consumer and the full force of the law.

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