Friday, January 23, 2009

Class Action Settlement Requires Giveaway of $175 Million in Free Cosmetics

An unusual agreement has department stores across the country overrun by customers eager to claim free products. The class action settlement in a lawsuit against several major department stores has required the stores to give away $175 million dollars worth of high end cosmetics. They began giving the products away on January 20, 2009 and will be giving them away through January 26 or until supplies run out.

The lawsuit, filled in 2003 against several cosmetics manufacturers and department stores, accused the defendants of conspiring to keep the price of certain cosmetics artificially high by agreeing not to offer sales and limiting their inventory. The settlement was approved in 2005, by U.S. District Judge Saundra B. Armstrong of the Northern District of California.

Defendant stores participating in the settlement include Saks Fifth Avenue, Macy's, Bloomingdales, Nordstrom, and 10 other department stores. The plaintiff class includes customers who purchased cosmetics from the defendant stores from May 29, 1994 through July 16, 2003.

Class members may claim one free product each, and their free product is to come from the same manufacturer that made the product they purchased during the class period, unless the store has run out of products made by that manufacturer. Class members have a list of products to choose from, and the stores will make substitutions or issue rainchecks.

It is estimated that 21.6% of the plaintiff class will be compensated. However, customers are not required to produce receipts or any proof that they are eligible for the free products. The story has been in the news and the stores are swamped with customers lining up for their free cosmetics. We may never know how many of the free products truly made their way into the hands of the customers they were meant to compensate.

Class actions like this are an example of how creative many lawyers can be in finding new ways to generate legal fees. Sometimes, it is not enough to just keep doing the same old things the same old way. You have to try something different. Here at Network Affiliates, we have been helping lawyers find new and better ways to generate legal fees for years. Whether it is mass torts, client relationship marketing, client networking meetings or internet marketing, we make sure that our clients are always on the cutting edge.

Harlan

posted by Harlan Schillinger at 5:57 AM

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