When a Sale May Not Be a Sale

A crossed-out price can make an ordinary purchase look like a bargain. The comparison should tell a truthful story.

Have you ever bought something because the discount seemed too good to miss?

An online store shows a crossed-out price of $120 beside a “sale” price of $59. You see a chance to save $61. The higher number makes the lower price seem more attractive—and may make you feel that you should buy before the deal disappears. But what if the product has been selling for $59 for months? What if the supposed sale price is simply its usual price?

Why the Higher Price Matters

California’s False Advertising Law directly regulates this type of message. Business and Professions Code section 17500 broadly prohibits untrue or misleading advertising—including advertising over the internet—when the advertiser knew, or through reasonable care should have known, that the representation was untrue or misleading.

“which is untrue or misleading, and which is known, or which by the exercise of reasonable care should be known”

Business and Professions Code section 17501 establishes a more specific rule for former-price advertising. When a retailer represents a higher price as a product’s former price, that price generally must have been the product’s prevailing market price within the three months immediately preceding publication of the advertisement.

“unless the alleged former price was the prevailing market price as above defined within three months next immediately preceding the publication of the advertisement”

Simply placing a higher number on a website does not establish that it was a genuine prevailing price. When the same “sale” continues month after month, the promised savings may deserve a closer look. The message can also come from phrases such as “40% off” or “save 20%.” Courts have recognized, when deciding whether claims could proceed, that these statements may suggest a discount from a former price even without the word “formerly.” What matters is the overall message a reasonable shopper receives.

Not every discount is misleading. A retailer may offer a genuine markdown or an accurately explained comparison to a manufacturer’s suggested retail price (MSRP)—the price the manufacturer recommends that stores charge. But an MSRP is not proof that shoppers actually paid that amount, and the advertisement must make the basis for its comparison clear.

For Consumers: If You Bought Because of the Advertised Savings

You may have a concern even if the product itself works as expected. The issue can be whether a misleading discount influenced your decision to spend money.

Keep your receipt, order confirmation, and any screenshots or promotional emails showing the offer you saw. Note the purchase date and how the advertised savings affected your decision. These records can help a lawyer evaluate what the advertisement communicated and whether you suffered a financial loss.

California’s Consumers Legal Remedies Act (CLRA), False Advertising Law, and Unfair Competition Law provide different ways to challenge misleading pricing. Depending on the facts and legal requirements, a claim may seek money back or an order stopping an unlawful practice. A full refund is not automatic.

Some disputes can be addressed through a written demand and settlement discussions. Certain claims require advance written notice before monetary relief can be pursued. If the issue remains unresolved, an individual lawsuit—or, where appropriate, a class action for similarly affected purchasers—may be an option.

The three-month former-price rule is not the deadline for consumers to bring a claim. Filing deadlines depend on the claims and circumstances, so consumers should seek advice promptly rather than assume that a past purchase is too old—or that there is unlimited time to act.

For Businesses: If Your Business Advertises Discounts

A discount is a factual claim about the savings a customer can expect. Businesses should understand what each reference price represents and keep records supporting the comparison. An ongoing promotion deserves ongoing review, particularly when the “sale” price becomes the price customers ordinarily pay. Website banners, product pages, emails, and checkout messages should tell a consistent story. A pricing practice can create risk even when the same format is common elsewhere in the industry.

If your business receives a demand letter, prompt legal advice can help you assess the allegations and applicable deadlines. Corrective action can affect available remedies, but changing a webpage or refunding one purchase does not necessarily resolve every issue. Where many customers saw the same advertising, the dispute may extend beyond a single transaction. Depending on the claims and evidence, exposure can include consumer repayment, damages under the CLRA, changes to advertising, and a prevailing CLRA plaintiff’s attorneys’ fees and court costs. Punitive damages may also be available under the CLRA when the additional legal requirements are met.

If an advertised discount influenced your purchase and you are concerned the savings were not genuine, contact Moudern P.C. to discuss your experience and whether legal options may be available.

Business owners may also contact Moudern P.C. about reviewing pricing practices or responding to a false-advertising demand. An early review can help clarify the issues and inform the next step.