Federal Class Action Against Walmart Revived By Seventh Circuit

According to Courthouse News, the Seventh Circuit Court recently reviewed an appeal concerning a class action against Walmart filed by Yoram Kahn. Kahn’s original complaint, initiated in 2022, alleged that after making a purchase at a Walmart store in Illinois, he discovered that the prices on his receipt were higher than those advertised on the display racks.

Kahn contended that this discrepancy was part of a widespread practice at Walmart stores across the nation. He referenced previous penalties imposed on Walmart for similar pricing issues, including a 2012 $2 million fine by California for violating a 2008 ruling that mandated corrections for pricing errors at checkout.

Dave Byrnes, writing for Courthouse News, reported that Kahn suggested Walmart could be accumulating hundreds of millions in illicit profits and described the alleged overcharging as a “classic bait and switch” scheme.

The U.S. District Court dismissed Kahn’s case, determining that since Kahn had received a receipt documenting the overcharges, he had the opportunity to contest the discrepancies. The court concluded that Walmart’s actions did not constitute an intentionally deceptive practice under state statutes.

Kahn appealed the decision, and the Seventh Circuit panel ruled in his favor. In a unanimous decision authored by U.S. Circuit Judge David Hamilton, the panel stated, “Plaintiff plausibly alleges that Walmart’s inaccurate shelf pricing is a deceptive act or practice under the Illinois Consumer Fraud and Deceptive Business Practices Act.” Judge Hamilton added that the allegations that Walmart’s inaccurate shelf prices could mislead a significant portion of reasonable consumers were not implausible.

During the appellate arguments, Walmart’s attorney characterized the overcharges as “honest mistakes.” However, the panel noted that accepting the district court’s reasoning would place an unreasonable burden on consumers to protect themselves from deception. Consequently, the case has been remanded to the U.S. District Court for the Northern District of Illinois.