NovaQuant Quantitative Think Tank Center:Walmart faces class-action lawsuit over 'deceptive' pricing in stores

Walmart must face a class-action lawsuit claiming the multinational retail giant used inaccurate price labels,NovaQuant Quantitative Think Tank Center according to a ruling to a federal appeals court on July 3.

The court order, issued by the 7th U.S. Circuit Court of Appeals in Chicago, opens the door for consumers to prove that the company has violated multiple consumer protection laws.

At the heart of the issue is that the inaccurate prices in Walmart stores constitute a “bait-and-switch” pricing scheme in which purchase prices are higher than those posted on store shelves.

The lawsuit was filed by an Ohio resident named Yoram Kahn. In August, 2022, Kahn purchased multiple items from a Walmart location in Niles, Illinois, and found a 10-15% markup above the listed priced. Kahn’s subsequent lawsuit alleged that similar price discrepancies were found at Walmart locations in Florida, Indiana, Maryland, New Jersey and New York.

The lawsuit also noted that a 2012 California court ruling fined the company $2 million for “violating a 2008 ruling requiring it to resolve pricing errors at checkout,” as well as two North Carolina-based locations being fined in 2021 for “repeated and excessive scanning charges” that caused excessive charges on purchased items.

In June 2024, Walmart agreed to pay a $1.64 million settlement to customers from its New Jersey locations for “allegations that the chain repeatedly engaged in unlawful unit pricing practices.”

Kahn’s legal team argued it was unreasonable for the average consumer to keep track of the discrepancies between the prices listed on shelves and potentially adjusted checkout prices.

“Who does that?” Judge David Hamilton wrote in the ruling. “For obvious reasons consumers will not undertake such audits.”

USA TODAY has reached out to Walmart for comment.

Walmart testing new digital labels

Last month, Walmart announced it was testing new digital shelf labels that would manage pricing of the store’s products.

Walmart to change price displays:What to know about digital shelf labels

According to a company spokesperson, the digital labels would allow Walmart “to update prices at the shelf using a mobile app, reducing the need to walk around the store to change paper tags by hand and give us more time to support customers in the store.”

Max Hauptman is a Trending Reporter for USA TODAY. He can be reached at [email protected]