MINNEAPOLIS--(BUSINESS WIRE)--Customers of online retailer Fingerhut.com filed a class action lawsuit today in the District of Minnesota alleging that the company’s huge markups on electronics, household goods and other products are actually finance charges in disguise.
The complaint alleges that Fingerhut.com (owned by Bluestem Brands of Eden Prairie, Minn.), targets low-income consumers with damaged credit to sell them extremely high-cost electronics and household goods. Items sold on Fingerhut to low-income consumers come with substantial markups. For example, Fingerhut currently sells an iPad Mini 3 for $539.99, although its retail price is $399. According to the complaint, this massive sales price markup is actually a finance charge in disguise—violating the Truth in Lending Act, state consumer protection statutes and state usury laws.
According to the complaint, virtually all purchases on Fingerhut.com are made on credit that Bluestem arranges, and virtually all purchases come from consumers targeted by Bluestem as having a low income and a low FICO credit score. On the other hand, Bluestem owns and operates another website, branded as Gettington.com, which sells identical consumer goods – at far lower prices -- to higher income consumers with higher FICO credit scores.
Plaintiff Jessica Parm seeks to represent all individuals who had similar experiences on Fingerhut.com.
Melissa Wolchansky, an attorney at Halunen Law, says, “Consumers deserve to know what finance charges Fingerhut is applying to their purchases. When companies are honest and up front about interest charges, consumers can make informed decisions.”
Jeffrey Kaliel, a partner with Tycko & Zavareei, says, “Bluestem charges higher prices to consumers with low incomes or damaged credit, but offers the same products to those with better credit and higher incomes for much less. If Fingerhut is going to charge huge amounts of interest on low-income consumers, it should not disguise that fact behind big price markups.”
Tycko & Zavareei and Halunen Law represent Parm, and urge consumers who made purchases on Fingerhut.com to learn more about their legal rights. For additional inquiries, contact Wolchansky at 612-605-4098 or Kaliel at 202-973-0900.
Case: 0:15-cv-03437, United States District Court, District of Minnesota
About Halunen Law
Halunen Law has expertise in litigating consumer class actions and a track record of success in challenging dishonest marketing, corporate fraud and illegal business practices. Halunen also offers experienced representation to employees and whistleblowers under the False Claims Act and other statutes. Visit the firm’s website at www.halunenlaw.com.
About Tycko & Zavareei
Tycko & Zavareei LLP, based in Washington, D.C., has a long, successful record of litigating complex cases. The firm routinely handles large and complex matters throughout the country, advocating on behalf of individuals fighting for their civil rights, consumers seeking redress for unfair business practices, whistleblowers exposing fraud and corruption, and non-profit entities and businesses facing difficult litigation.