Shoppers Take Legal Action Against Hermès for Denied Birkin Bag Purchase

Introduction

Luxury brand Hermès is facing a class action lawsuit in California after two shoppers were unable to purchase the coveted Birkin bag. Tina Cavalleri and Mark Glinoga have sued the company, alleging that Hermès’ sales practices for the exclusive Birkin bags violate antitrust laws. The lawsuit claims that the brand requires customers to make additional luxury purchases before being given the opportunity to buy a Birkin bag, effectively increasing the price and boosting the company’s profits.

The Birkin Bag Dilemma

Tina Cavalleri, one of the plaintiffs, stated in the lawsuit that despite spending a significant amount at Hermès, she was told that the Birkin bag was only available to “clients who have been consistent in supporting our business.” This led her to believe that she would have to spend even more in order to make her desired purchase. Mark Glinoga, the second plaintiff, also encountered obstacles in his quest for a Birkin bag. He was repeatedly told that he needed to purchase other Hermès items and accessories, ultimately resulting in his inability to acquire the bag.

Violation of Antitrust Laws

Cavalleri and Glinoga have taken their case to court, alleging that Hermès’ sales practices for the Birkin bags violate antitrust laws. The lawsuit claims that the brand’s requirement for customers to build a “purchase profile” by buying additional luxury goods before being able to purchase a Birkin bag is a form of tying or bundling goods, which is considered an abuse of market power. By implementing this scheme, Hermès effectively increases the price of Birkin handbags and maximizes their profits, according to the lawsuit.

Hermès’ Sales Structure Under Scrutiny

The lawsuit also highlights Hermès’ sales structure as evidence of the alleged abuse. Sales associates are reportedly not paid commission on Birkin bag sales but do receive a 3% commission for ancillary products sold to establish purchase history. This, the lawsuit argues, enables Hermès to exploit their sales associates to implement the illegal tying arrangement and boost sales of other luxury items.

The Pricing and Exclusivity of Birkin Bags

Birkin bags, which cannot be purchased online, are renowned for their exclusivity and luxury. Pricing for these iconic bags starts at $10,000 and can reach six figures, making them highly sought-after by fashion enthusiasts and collectors alike.

Hermès’ Response

Hermès has not yet responded to requests for comment regarding the class action lawsuit. As the case unfolds, the outcome could have significant implications for the luxury fashion industry and may prompt a reassessment of sales practices for exclusive designer products.

To stay updated on the latest business news and insights, visit Business Today.