8th Circuit tosses suit claiming false clothing sale prices

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ST. LOUIS — The 8th U.S. Circuit Court of Appeals on Nov. 14 agreed that a woman failed to show an “ascertainable loss” when she purchased clothing from Old Navy at an allegedly deceptive sale price.

Jill Hennessey was the named plaintiff in a putative class action lawsuit against Old Navy and its parent company, The Gap Inc. In her suit filed in the U.S. District Court for the Eastern District of Missouri, Hennessey alleged that the store’s sales prices were fictitious and that it never sold a substantial quantity of the products at the advertised “regular” prices.

For instance, the suit alleged that the store sold a crew-neck T-shirt with a regular price of $14.99 and a sale price of $7.49. Hennessey alleged that “the actual fair market value of each item at the time of her purchase was materially lower than the advertised former prices and may have even been less than the discounted prices that she paid.”

However, Judge Sarah E. Pitlyk ruled that the suit failed to meet an element of the Missouri Merchandising Practices Act that requires the plaintiff to have “suffered an ascertainable loss of money or property” to bring a claim. She dismissed the suit prior to class certification.

The 8th Circuit agreed. Reviewing Missouri cases as far back as 1909, the court said Hennessey had received the “benefit of the bargain” by getting the shirt she wanted at the price the store advertised.

Although Missouri state regulations prohibit sellers from using “illusory or fictitious” prices, the court said that didn’t help her case.

“The existence of a deceptive practice, a distinct element of her claim, is not at issue,” Judge James B. Loken wrote. “The Attorney General and local prosecutors may commence criminal actions against those who knowingly engage in deceptive practices…, but a private plaintiff suing for damages under [the MMPA] must also prove an ascertainable loss.” Judges Raymond W. Gruender and Duane Benton concurred.

Matthew J. Zevin of Kitner Woodward in Encinitas, California, argued for the plaintiff. Stephanie Schuster of Morgan, Lewis & Bockius in Washington, D.C. argued for the store. Neither returned emails seeking comment.

The case is Hennessey v. The Gap Inc., 22-3187.