Ann Taylor and Loft Built Its Checkout to Deceive You at the Worst Moment
Premium Brands Opco LLC ran its Ann Taylor and Loft websites with a pricing scheme designed to show you a low number first and hit you with a mandatory hidden fee only after you had already typed in your home address. Two consumers sued. The receipts are in the court record.
The Non-Financial Ledger: What the Fee Actually Cost
Nary Sun was shopping online the way most people do. She was not an activist. She was not a legal scholar hunting for violations. She was a woman in Sunnyvale who needed two tops and found them on sale for $24.75 each on Ann Taylor’s website. She added them to her cart. She clicked through the product page. She clicked through the cart summary. She put in her email address. She put in her mailing address. She did everything the website told her to do before it showed her what the purchase would actually cost.
By the time the fee appeared, she was past the point where most people turn back. That is the design. The website does not show you the real number when you are still in browsing mode, still weighing your options, still free to close the tab and go to Gap or Abercrombie instead. It shows you the real number once your home address is already in the system. Once you have invested the time. Once walking away feels wasteful. That is not a coincidence; it is a strategy.
Floribel England experienced the same thing in Woodbridge, Virginia in July 2025. She purchased multiple items on Loft’s website, including a Zig Zag Linen Blend Easy Tank Top listed at $24.94. She went through the same click-by-click process. She entered her address. The bundled fee appeared: $16.95 for “Shipping & Handling.” There is a legitimate shipping cost in that number. There is also a processing surcharge buried inside it. The company knows exactly what percentage of that $16.95 is the hidden fee. That information has never been disclosed to any customer.
Multiply this across thousands of transactions. Every person who browsed those sites and saw a price they trusted made a decision based on that number. Some of them would have gone somewhere else. The lawsuit says so directly: by not knowing the real total upfront, shoppers had no way to compare prices at other retailers. That is lost market power. That is the company using an information asymmetry it deliberately created to keep you from choosing a competitor. And it worked. For at least as long as it has taken two people to hire lawyers, gather screenshots, and file a 27-page federal complaint.
The fee is described in the complaint as something that cannot be avoided. There is no option to opt out. There is no alternative checkout path that removes it. You either pay it or you do not buy the item. The company designed a system where the only way to see your real total is to hand over your personal address first. Your data as the price of admission to the truth about the price.
“Californians are fed up with dishonest fees being tacked on to seemingly everything. It’s an underhanded trick to boost corporate profits at the expense of those who can least afford it.”
— California State Senator Bill Dodd, co-author of SB 478
Legal Receipts: What the Court Documents Actually Say
Every quote below comes directly from the filed complaint, Case 1:26-cv-01614 (S.D.N.Y., Feb. 26, 2026), or from the government sources cited within it. No paraphrasing.
“Defendant has nickel and dimed online purchasers on its websites in violation of California’s Consumer Legal Remedies Act (‘CLRA’) and Virginia’s Mandatory Fee and Surcharge Disclosure Law, Va. Code § 59.1-607 et seq.”
Complaint ¶ 1 — Nature of the Action
- This is the opening accusation in the federal complaint. “Nickel and dimed” is not rhetorical embellishment; it is the lawyers’ literal characterization of a pattern where small mandatory fees are added after a consumer is committed to a purchase, multiplied across thousands of transactions.
- Two separate bodies of law are cited in the first sentence, meaning the company’s conduct was illegal in multiple states simultaneously, across an extended period of time.
“Whenever a consumer visits one of the Websites and selects an item for purchase, they are not shown the total cost upfront. Instead, consumers are quoted an artificially low price, only for Defendant to sneak in a mandatory ‘Processing’ fee at the end of the purchase process.”
Complaint ¶ 2 — Nature of the Action
- The complaint uses the word “artificially.” The advertised price is described as a deliberate distortion of the real price, not an honest preliminary figure that happens to be incomplete.
- The fee is characterized as something that is “sneaked in,” placing the intent to conceal at the center of the allegation, which will matter when damages are calculated and when punitive liability is argued.
“‘Drip pricing’ is a ‘common form of bait and switch.’ Mansfield v. StockX LLC, 802 F. Supp. 3d 1143, 1148 (N.D. Cal. 2025) (citation omitted). And various state consumer protection laws have long ‘banned bait and switch in consumer transactions.’ Id. (noting California’s prohibition began in 1970).”
Complaint ¶ 4 — citing established federal case law
- This is the legal framing that connects Ann Taylor and Loft’s checkout design to a category of fraud that California courts have prohibited for over fifty years. The company is not doing something novel; it is doing something old and well-understood to be illegal.
- The citation to a 2025 federal case means there is already an active body of law in Northern California specifically addressing this practice in e-commerce, which directly applies to the California class claims here.
“Californians are fed up with dishonest fees being tacked on to seemingly everything … It’s an underhanded trick to boost corporate profits at the expense of those who can least afford it. Our bill will end these unfair practices and put the consumer first, leveling the playing field for reputable businesses that advertise the real price up front.”
Complaint ¶ 24 — quoting California State Senator Bill Dodd, co-author of SB 478
- This quote is included in the complaint to establish legislative intent. When a court evaluates whether the law covers Ann Taylor’s conduct, it can look at what the lawmakers said they were trying to stop. Senator Dodd described precisely what Ann Taylor and Loft did: tacking fees onto purchases in a way that disproportionately harms people with less money.
- The phrase “those who can least afford it” signals that this is a class and income-equity issue. Shoppers at Ann Taylor and Loft are not uniformly wealthy; many are bargain-hunting during sales. Hidden fees on sale items undo the discount.
“A business can exclude shipping charges, but not handling charges. … Like any other mandatory fee or charge, a handling charge must be included in the advertised price.”
Complaint ¶ 23 — quoting California Attorney General’s Office, SB 478 FAQ
- This is the clearest possible official statement of the law. The California AG’s office left no ambiguity: handling and processing fees must be in the advertised price. Premium Brands Opco knew this rule existed, because it came from the AG’s own published FAQ on a law that took effect in 2024.
- Ann Taylor and Loft bundled the processing fee together with the shipping fee into a single line item, making it structurally impossible for the consumer to see the processing portion. The complaint notes that “discovery will reveal what percentage of the bundled ‘Shipping & Processing’ fee is allocated for ‘Processing.'” The company knows the split. They have not told anyone.
“Defendant willfully employed a scheme designed to advertise a price that is not the true cost of its products, and did so willfully, wantonly, and with reckless disregard for the truth.”
Complaint ¶ 86 — Count II, California Civil Code § 1770(a)(9)
- The triple escalation (“willfully, wantonly, and with reckless disregard”) is deliberate legal language designed to support punitive and enhanced damages, not just compensatory ones. The plaintiffs are explicitly arguing this was a conscious choice, not a mistake.
- This language, if proven, places the conduct in the category of intentional consumer fraud rather than negligent disclosure failure. That matters for the severity of the penalty the court can impose.
“By hiding its Fee, Defendant was able to reduce price competition and cause consumers like Plaintiff Sun and California Subclass members to overpay.”
— Complaint ¶ 73, Sun v. Premium Brands Opco LLC
Societal Impact Mapping
Public Health: The Financial Stress Layer
Hidden fees at checkout are a documented source of financial anxiety, and they land hardest on people who are already watching every dollar. The structure of this particular scheme amplifies that harm.
- Shopping on sale items, as both plaintiffs were doing, is a budgeting behavior. Sun paid $24.75 per item. England paid $24.94 for a tank top. These are not luxury purchases; they are discounted basics. A mandatory hidden fee on a sale item cancels out a portion of the discount, most acutely for people who relied on that sale price to stay within budget.
- The checkout flow requires a consumer to enter their home address before they can see the real total. People who do not have a stable address, who are sharing a housing situation they prefer not to disclose, or who are otherwise privacy-sensitive must expose personal information before they can learn the full cost of the item. There is no path to price transparency that does not require surrendering location data first.
- The fee is non-negotiable and non-optional. Unlike a service fee at a restaurant where you can order less, or a delivery fee you can avoid by picking up in person, there is no alternative purchasing path on these websites that allows you to avoid the processing charge. Pay it or leave with nothing.
- The psychological cost of “sunk cost” pressure is embedded in the design. By the time the fee appears, the consumer has spent time browsing, selecting, creating or logging into an account, and typing in personal details. Abandoning the cart at that point feels like losing what you already invested. That feeling is manufactured by the placement of the fee disclosure at the end of the process rather than the beginning.
Economic Inequality: How Price Deception Concentrates Money Upward
Drip pricing is functionally a regressive tax. It extracts more from people who lack the time, tools, or knowledge to detect and resist it.
- The complaint explicitly names the anti-competitive effect: “By hiding its Fee, Defendant was able to reduce price competition and cause consumers like Plaintiff Sun and California Subclass members to overpay.” When shoppers cannot compare true prices across retailers, the retailer that hides fees wins sales it would not win in a transparent market. That is a market distortion that transfers money from consumers to the company on the basis of deception.
- Gap and Abercrombie are cited by name in the complaint as competitors. Both plaintiffs are described as having lost the ability to comparison-shop because the true price of the Ann Taylor and Loft items was concealed until after the decision to purchase was effectively locked in. Market competition requires informed consumers; this checkout design deliberately eliminates that condition.
- Class members “likely number in the thousands” per the complaint, and the aggregate amount in controversy exceeds $5,000,000. Even if each individual fee is only a few dollars, the aggregate extraction from working consumers is in the millions of dollars, flowing to a company headquartered at 7 Times Square in Manhattan.
- California’s legislature and attorney general both noted that these fees fall hardest on people “who can least afford it.” Online clothing shopping often skews toward consumers in the $30,000–$70,000 household income range who are using sales and discounts to stretch their budgets. Hidden fees on discounted goods are a direct attack on that budgeting strategy.
- Smaller and more ethical retailers who show full prices upfront are penalized in this environment. When a competitor shows $30 (total) and Ann Taylor shows $24.75 (plus hidden fees), Ann Taylor appears cheaper at the browsing stage even when the total cost is the same or higher. Honest pricing looks expensive; dishonest pricing looks like a deal. The complaint’s reference to “leveling the playing field for reputable businesses that advertise the real price up front” identifies this as an industry-wide fairness problem, not just a consumer protection one.
“By not knowing the total cost before selecting a product for purchase from Defendant, Plaintiff Sun and California Subclass Members could not shop around for clothing at other retailers, such as Gap and Abercrombie, to name a few.”
— Complaint ¶ 73
The “Cost of a Life” Metric
What Now: How to Push Back
The case is active in federal court. Here is who is accountable, who can help, and what you can do right now.
The Defendant
- Premium Brands Opco LLC: The named defendant. Operates Ann Taylor (www.anntaylor.com) and Loft (www.loft.com). Corporate headquarters at 7 Times Square, New York, NY 10036.
- The company’s specific officers and board members are not named in the complaint. The legal entity responsible for the checkout design and pricing policy is Premium Brands Opco LLC.
The Attorneys Bringing This Case
- Neal J. Deckant, Bursor & Fisher, P.A.: Lead counsel. 1990 North California Blvd., 9th Floor, Walnut Creek, CA 94596. Phone: (925) 300-4455. Email: ndeckant@bursor.com
- Stefan Bogdanovich, Bursor & Fisher, P.A.: Co-counsel. Email: sbogdanovich@bursor.com
- Ines Diaz Villafana and Celina Reynes: Co-counsel (pro hac vice forthcoming). Emails: idiaz@bursor.com and creynes@bursor.com
Regulatory Watchlist
- California Attorney General’s Office (AG Rob Bonta): Enforces California Civil Code § 1770 / SB 478. Direct complaints about drip pricing and hidden fees to the CA AG consumer protection division. oag.ca.gov
- Virginia Attorney General’s Office: Enforces the new Mandatory Fee and Surcharge Disclosure Law, Va. Code § 59.1-607 et seq., effective July 1, 2025. ag.virginia.gov
- Massachusetts Attorney General’s Office: Enforces 940 CMR 38.04, effective September 2, 2025, on total-price disclosure. mass.gov/ago
- Federal Trade Commission (FTC): Has federal authority over deceptive pricing practices in e-commerce under Section 5 of the FTC Act. Consumer complaint portal: reportfraud.ftc.gov
- Consumer Financial Protection Bureau (CFPB): Tracks and publishes data on junk fees and hidden charges in consumer commerce. consumerfinance.gov/complaint
What You Can Do Right Now
- If you purchased from anntaylor.com or loft.com and paid a “Shipping & Processing” or “Shipping & Handling” fee: You may be a member of one of the named classes. Contact Bursor & Fisher at the addresses above. Keep your order confirmation emails and any credit card statements showing the charge.
- Screenshot your checkouts: On any e-commerce site, before you enter your address, screenshot what price you are shown. Then screenshot the final total after your address is entered. If the number changed by anything other than sales tax or shipping, you may have evidence of a drip pricing violation in your state.
- File a complaint with your state AG: It takes five minutes. Every complaint filed builds the administrative record that consumer protection offices use to prioritize enforcement. California, Virginia, and Massachusetts have active regulatory frameworks. Other states are watching.
- Talk to people in your community about what honest pricing looks like: The law is on your side in three states and growing. Normalized outrage at hidden fees is what drove California to pass SB 478 in the first place. Senator Dodd credited constituent frustration explicitly.
- Support mutual aid networks focused on consumer financial literacy: Organizations that help lower-income households navigate digital commerce and understand their rights are doing work that state governments cannot do at scale. Find your local credit union, legal aid office, or consumer justice nonprofit and put money or time toward them.
The source document for this investigation is attached below.
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