Michael Kors Settles U.S. Lawsuit Alleging Deceptive Price Tags

Michael Kors Holdings Ltd agreed to pay $4.88 million and change its sales practices to settle a class-action lawsuit claiming it used deceptive price tags at its outlet stores to fool shoppers into believing they were getting big bargains. The preliminary settlement was filed on Friday in Manhattan federal court, and requires court approval. Michael Kors was accused of creating an "illusion" of deep discounts by using tags containing made-up "manufacturer's suggested retail prices," and offers to sell the products at lower prices, termed "our price." Shoppers said the suggested retail prices were artificial because the tagged products had been made exclusively for Michael Kors outlets, and the London-based fashion house never intended to sell them at those prices.