Corporate Accountability Project | Class Action Watch | Case No. 1:26-cv-01614
Drip Pricing · Class Action · Filed Feb 26, 2026
Ann Taylor and Loft Buried Mandatory Fees From Online Shoppers in California and Virginia
Premium Brands Opco LLC operated a deliberate bait-and-switch scheme across two major fashion retail websites, hiding a compulsory processing fee until the very last step of checkout.
● HIGH SEVERITY
TL;DR
Ann Taylor and Loft, both operated by Premium Brands Opco LLC, systematically showed consumers artificially low prices throughout the entire browsing and shopping experience, only revealing a mandatory “Processing” or “Handling” fee at the very end of checkout, after shoppers had already entered their personal information. This practice, known as drip pricing, is a documented bait-and-switch tactic that strips consumers of their ability to compare prices and shop elsewhere. California and Virginia both passed laws explicitly banning this conduct. The class includes thousands of online shoppers who overpaid for fashion items they believed were priced honestly.
These are not technical violations buried in fine print. This is a deliberate design choice to deceive. Demand full price transparency from every retailer you shop with.
$8.95
Hidden fee charged to CA plaintiff at Ann Taylor
$16.95
Hidden fee charged to VA plaintiff at Loft
$5M+
Amount in controversy threshold for federal jurisdiction
1,000+
Estimated class members across CA and VA
3 yrs
Look-back period for California class members
2
States with new laws violated: California and Virginia
⚠️ Core Allegations: What They Did
Core Allegations
What they did · 6 points
▾
| 01 | Premium Brands Opco LLC systematically hid a mandatory “Processing” or “Handling” fee across both the Ann Taylor and Loft websites, refusing to disclose it until shoppers had completed nearly the entire checkout flow, including entering their email and mailing address. | high |
| 02 | On December 13, 2025, plaintiff Nary Sun of Sunnyvale, California purchased items from Ann Taylor and was charged a bundled Shipping and Processing fee of $8.95 that was never disclosed at any point during browsing or early checkout. | high |
| 03 | On July 6, 2025, plaintiff Floribel England of Woodbridge, Virginia purchased items from Loft and was charged a bundled Shipping and Handling fee of $16.95 that was not disclosed until the final checkout stage. | high |
| 04 | The fee is mandatory, meaning there is no pathway to complete a purchase on either website without paying it. Consumers were given no choice and no warning before committing their personal information to the transaction. | high |
| 05 | The defendant bundled the unlawful Processing fee together with a legitimate shipping fee, obscuring the nature and amount of the undisclosed charge and making it harder for consumers to identify the violation. | medium |
| 06 | The defendant used both “Processing” and “Handling” terminology interchangeably to describe the same undisclosed charge, suggesting a calculated flexibility in how the fee was labeled rather than any legitimate operational distinction. | medium |
Regulatory Violations
Laws broken and how · 5 points
▾
| 01 | California’s Honest Pricing Law (Civil Code Section 1770(a)(29)(A)), effective July 1, 2024, explicitly prohibits advertising or offering a price that does not include all mandatory fees except government taxes and actual postage. The defendant’s Processing fee fits neither exemption. | high |
| 02 | Virginia’s Mandatory Fee and Surcharge Disclosure Law (Va. Code Section 59.1-608), effective July 1, 2025, requires suppliers to clearly and conspicuously display the total price including all mandatory fees when advertising goods. The defendant failed to do this on both websites. | high |
| 03 | The California Attorney General’s Office has explicitly stated that handling charges must be included in the advertised price and cannot be excluded the way shipping charges can. The defendant ignored this published guidance. | high |
| 04 | Virginia’s violation triggers the state Consumer Protection Act’s enforcement provisions (Va. Code Section 59.1-200), which prohibit advertising goods with the intent not to sell at the advertised price. This creates exposure to statutory damages for every affected Virginia class member. | medium |
| 05 | State legislatures in California, Virginia, and Massachusetts each separately enacted drip-pricing bans in recognition of how widespread and harmful this practice had become. The defendant’s conduct continued despite this public, coordinated regulatory response. | medium |
Profit Over People
Revenue prioritized over honesty · 4 points
▾
| 01 | By hiding the Processing fee until checkout’s final step, the defendant suppressed price competition: consumers could not compare the true cost of items against those at competing retailers like Gap or Abercrombie before committing to the purchase. | high |
| 02 | California’s Senator Bill Dodd, co-author of the law the defendant violated, described the practice as “an underhanded trick to boost corporate profits at the expense of those who can least afford it.” The class includes everyday consumers buying basic clothing items priced under $30. | high |
| 03 | The defendant’s scheme inflated effective purchase prices for every online order placed across both the Ann Taylor and Loft platforms, generating undisclosed fee revenue at scale across thousands of transactions. | medium |
| 04 | The defendant willfully designed a checkout flow that showed the item price at every stage from browsing to cart to early checkout, then introduced the mandatory fee only after collecting personal information, a sequence the complaint describes as “willful, wanton, and with reckless disregard for the truth.” | high |
Economic Harm to Consumers
Financial damage across the class · 4 points
▾
| 01 | Plaintiff Sun paid $8.95 in bundled Shipping and Processing fees on a purchase that included items advertised at $24.75 each. The undisclosed processing component represented a meaningful percentage surcharge on low-priced clothing items. | medium |
| 02 | Plaintiff England paid $16.95 in bundled Shipping and Handling fees at Loft, on a purchase that included items advertised starting at $24.94. The true total cost was not knowable until the purchase was nearly complete. | medium |
| 03 | Because the class encompasses purchases over a three-year window in California and two years in Virginia, the aggregate financial harm to class members is projected to exceed $5 million, the threshold that triggers federal jurisdiction under the Class Action Fairness Act. | high |
| 04 | Consumers were stripped of meaningful price-comparison ability. Without knowing the true final cost upfront, shoppers had no opportunity to determine whether a competing retailer offered a better deal, a basic function of a fair marketplace. | high |
Corporate Accountability Failures
How they got away with it · 4 points
▾
| 01 | California’s drip-pricing ban went into effect July 1, 2024. Virginia’s took effect July 1, 2025. The defendant’s alleged conduct continued after both effective dates, meaning the company either failed to audit its own checkout practices or chose not to comply. | high |
| 02 | The defendant’s checkout was specifically designed to delay fee disclosure until the precise moment when abandoning the purchase feels costliest to the consumer: after entering personal information and nearly completing the transaction. | high |
| 03 | Individual consumers affected by fees of $8–$17 per transaction lack the practical resources to pursue litigation on their own. The class action mechanism exists precisely because corporations rely on this asymmetry to perpetuate small-scale, high-volume harm. | medium |
| 04 | The defendant’s headquarters at 7 Times Square, New York places it in one of the most resourced corporate environments in the world. The claim that a company of this scale was unaware of state consumer-protection laws explicitly targeting its core business practice is not credible. | medium |
🕐 Timeline of Events
July 2024
California’s Honest Pricing Law (SB 478) takes effect, explicitly banning the advertising of prices that exclude mandatory handling and processing fees.
July 6, 2025
Plaintiff Floribel England purchases items from Loft’s website in Virginia and is charged a bundled $16.95 Shipping and Handling fee without prior disclosure.
July 1, 2025
Virginia’s Mandatory Fee and Surcharge Disclosure Law takes effect, requiring all online retailers to display total prices including mandatory fees from the first moment of advertising.
Sept 2, 2025
Massachusetts’ price-transparency regulation takes effect under the state Consumer Protection Act, joining California and Virginia in banning drip pricing.
Dec 13, 2025
Plaintiff Nary Sun purchases items from Ann Taylor’s website in California and is charged a bundled $8.95 Shipping and Processing fee that was never disclosed during browsing or early checkout.
Feb 26, 2026
Class action lawsuit filed in the Southern District of New York (Case No. 1:26-cv-01614) against Premium Brands Opco LLC on behalf of California and Virginia consumers.
💬 Direct Quotes from the Legal Record
QUOTE 1
The definition of drip pricing and why it is illegal
Core Allegations
“Businesses engage in drip pricing by advertising products at artificially low headline prices and then disclosing additional charges later in the buying process.”
This is the legal definition the court applied. The complaint documents exactly this pattern across both Ann Taylor and Loft’s checkout flows.
QUOTE 2
Drip pricing is bait and switch
Core Allegations
“Drip pricing is a common form of bait and switch.”
Courts have already ruled that hiding fees until late checkout constitutes bait-and-switch conduct. This complaint applies that precedent directly to Ann Taylor and Loft.
QUOTE 3
California’s Senator on who this practice hurts most
Profit Over People
“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.”
Senator Bill Dodd, co-author of California’s drip-pricing ban, made clear who these fees hurt. Many Ann Taylor and Loft purchasers were buying sale-priced items under $30.
QUOTE 4
The California AG on stopping consumer exploitation
Regulatory Violations
“We can and should stop the fleecing of consumers. We can and should stop the imbalance in the marketplace.”
California Attorney General Rob Bonta framed hidden fees as a structural market imbalance, not just a technicality. This framing is directly applicable to the defendant’s conduct.
QUOTE 5
The fee was never shown before the final step
Core Allegations
“The total price is never disclosed before a user reaches the final step in the checkout process prior to placing an order.”
The complaint documents the full checkout flow with screenshots showing the fee absent from browsing, item pages, the cart, and early checkout, appearing only at the very end.
QUOTE 6
The fee was unavoidable
Core Allegations
“The Fee is mandatory because there is no way to purchase a product on the website without paying the Fee.”
There was no opt-out, no alternative path, and no warning. Every single online purchase on both platforms was subject to this undisclosed charge.
QUOTE 7
Processing fees must be in the advertised price
Regulatory Violations
“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.”
The California Attorney General’s own published FAQ addressed this exact scenario. The defendant had no legal basis to claim the processing fee was a permissible exclusion.
QUOTE 8
Defendant’s intent to deceive was willful
Corporate Accountability Failures
“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.”
This language, drawn from the complaint, carries legal weight. Willful conduct can affect the scope of available damages and penalty exposure.
💬 Commentary
Is this really that serious? It’s only $8 or $16.
▾
Yes, it is that serious. The per-transaction amount is deliberately small, which is exactly what makes this kind of fraud scalable and profitable. When a company charges an undisclosed $8–$17 fee to every online customer across two major retail websites over multiple years, the aggregate harm easily crosses millions of dollars. Individual victims rarely have the resources to sue over $16. The company knows this. That asymmetry is the business model. The class action mechanism exists to make this kind of calculated small-scale exploitation economically unviable.
Why didn’t shoppers just leave the checkout when they saw the fee?
▾
The timing of the disclosure is the entire mechanism of the harm. The fee only appeared after consumers had already invested significant time browsing, selected items, logged in or created an account, and entered personal information including their mailing address. At that point, the psychological and practical cost of abandoning the purchase is high. This is not an accident. The checkout flow was specifically engineered to make disclosure happen at the moment consumers are least likely to walk away. The complaint calls this what it is: willful, wanton disregard for consumer rights.
Wasn’t Ann Taylor just bundling shipping with processing, which is normal?
▾
No. Bundling is part of the problem. California law explicitly permits businesses to exclude actual postage or shipping costs from the advertised price, but not processing or handling charges. By bundling the lawful shipping fee with the unlawful processing fee into a single line item labeled “Shipping and Processing,” the defendant obscured the nature of the charge. Consumers could not identify what portion was legitimate shipping and what portion was the unlawful add-on. The California AG’s published guidance addressed this exact scenario, leaving no ambiguity for the defendant.
Is Ann Taylor the only major retailer doing this?
▾
No. The complaint notes that drip pricing has proliferated across online e-commerce platforms broadly, which is precisely why California, Virginia, and Massachusetts all passed new laws specifically targeting it between 2024 and 2025. Courts in California have already ruled against similar practices at other retailers. The Ann Taylor and Loft case is part of a broader accountability wave targeting the fashion retail sector’s embrace of hidden checkout fees. If you shop online at clothing brands, assume this practice may affect other retailers you use as well.
What is the company actually accused of, in plain terms?
▾
Premium Brands Opco LLC is accused of advertising clothing at one price and then charging a higher price at checkout through a mandatory fee it concealed throughout the entire shopping experience. That is the definition of false advertising. The law has a word for advertising goods at one price with the intent to charge more: bait and switch. Four separate legal claims are brought in this complaint: two under California law and two under Virginia law. The company faced a clear legal requirement to display the true total price from the moment it displayed any price. It refused to do so.
What can I do to prevent this from happening again?
▾
If you live in California or Virginia and purchased from Ann Taylor or Loft online within the relevant class periods, you may be a class member. Monitor updates from Bursor and Fisher, P.A., the law firm representing plaintiffs, for information about how to participate. More broadly: document hidden fees you encounter at checkout with screenshots, report them to your state attorney general’s consumer protection office, and share them publicly. State AGs in California, Virginia, and Massachusetts now have explicit statutory authority to pursue drip-pricing violators. Public pressure and regulatory complaints accelerate enforcement. Demand to see the final total price before you enter your payment information on any website.
How strong is this lawsuit?
▾
The case is grounded in statutes that directly and explicitly address the conduct alleged. The plaintiffs have screenshot documentation of the entire checkout flow for both websites showing the fee absent until the final step. Federal courts in California have already found similar conduct actionable under the exact same statute. The defendant’s practices post-date the effective dates of both state laws, meaning there is no “we didn’t know” defense based on legal uncertainty. The case also cites a California federal court ruling from 2024 (Watson v. Crumbl LLC) that accepted nearly identical allegations as sufficient to proceed. This is not a novel theory: it is a well-documented pattern meeting clearly established law.
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