Helzberg Diamonds was founded in 1915 and has expanded from a family-owned jewellery store to a national retailer operated by Berkshire Hathaway, the conglomerate owned by Warren Buffett.
According to a complaint filed in a California federal court, a class action alleges that the company's online advertising features “made-up regular prices and made-up discounts” to encourage customers to purchase.
The sales are said to have no time limit, and when one promotion ends, the next one begins, offering the same price. The filing argues that this means that the discounted ‘sale’ price is the product's actual price.
“Reasonable consumers do not realise the fake nature of the sale. It is not apparent from merely purchasing the high-priced products, because the sale appears to be a bona fide sale,” the filing explains.
“Consumers do not have any reason to go back to the website day after day to discover there is still a sale. And even a consumer who occasionally checks the website would reasonably believe that there happened to be another sale, that the sale is not limited in time, that the discounts are fake, and that the advertised regular prices are fake.”
The complaint requests an injunction against the jewellery retailer, preventing it from promoting “fake” sales. Helzberg Diamonds operates more than 200 stores in the US.
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