Hermès Faces Class Action Suit Over Birkin Sales Practices

[bagsamplified]

This has just been a really fun thread to read after a long day at work

 

[CTLover]

I can’t comment on the merit of this lawsuit because law is not my area of expertise, but I will have to say that I was quite tickled by the news. I typically stand on the side of the consumer as opposed to the side of corporations and this time is no different.

Plus, we all know that it’s true and it would be disingenuous to pretend otherwise that “pre-spend” is not a requirement. The pages and pages here say otherwise. Again, will it hold up in a court of law? Is it a violation of antitrust laws? I have no idea. And more than likely the answer to both questions is no, but we all know that Hermes requires the majority of its clients to buy other things most of them don’t want in order to get quota bags and that that is the truth.

Again, given that Hermès is an international corporation that likely has some top notch US lawyers on staff and retainer, I've always doubted that there was a top down corporate policy enforcing pre-spend. If there was here in the US, then the readers on these pages would know that number because everyone's experiences would be exactly the same or similar. As it is, the matter of pre-spend seems to be a matter of rumor and conjecture. That said, individual boutique managers in the US (and again this lawsuit only applies to sales in the US), may set guidelines for their SAs to follow. Not hard and fast rules, but guidelines, and I can't imagine the US corporate attorneys wouldn't also be schooling managers on how to not run afoul of laws using the guidelines. My own experience is that there is no hard and fast pre-spend, but more that you have to develop a relationship, and show genuine appreciation of all products they sell and not be Birkin focused. I told a story a while back about how I wandered into my local store, and heard 3 people before me come in about buying bags (not Birkins but Evelyns etc). Each time a different SA told them they had absolutely no bags in the store of any kind. When my SA finished with her previous customer and came to me, I told her I was looking for a GP, but gathered they had none. My SA told me to wait, and disappeared, she then returned and offered me the choice between two different GPs. I am buy no means a huge spender, and only get a B or K every 5 years or so, so it had absolutely nothing to do with my pre-spend.

 

[2cello]

I don't know if there are written in stone pre-spend, but, SAs work on commission, and don't get commissions for selling B/Ks. So let's face it, if someone comes in wanting a Birkin, and makes it known they're willing to spend a lot of money on other stuff to get one, I think most SAs will take advantage of that. Leading that person on to get them to buy tens of thousands of dollars on other stuff they get 3% commission on. Then, just as they sense the buyer getting disinterested, surprise! They get a Birkin, and the process starts all over again. I also think that many SAs are apt to string along entitled, rude types along further then those who seem genuinely interested in the brand. Let's face it, the Birkin focused customer is only there for one thing, and likely to disappear after they get what they want. If I was an SA I'd be focusing on customers who buy the store and like the brand overall than someone who just wants a Birkin because its the bag du jour.

I would assume Hermes corporate is lawyered up enough to not get caught but there is no way they don’t know about these practices. And if they *wanted* to discourage it, they could pay sales people commission on the quota bags and then there would be no more “quota bags”. But they don’t, so that tells us a lot.

 

[allanrvj]

It’s kind of astounding to see the number of posts discussing pre-spend and then have Hermes buyers deny its existence.

Hermes runs a big con but one that sophisticated and rich people love to play so I think there are more pressing causes to chase than this one.

not really denying as there is an entire thread dedicated to it where people have shared their experiences, or asked for advice on how to navigate it.

it's more of stating the difficulty of proving it in court considering how it's only done verbally, or implied in some cases. also because it varies from store to store, or even customer to customer within the same store.

 

[yrtxcyrtxc]

Not to comment on the lawsuit as I am no expert but would like to share my view on “prespent “

So what should H do if they don’t “offer” their limited supply of precious bags to loyal clients with a decent purchase history? Random allocation to walk-ins? First come first serve?

Either way, opposed to some may think it will be easier for all of us to obtain the bag we desire, my guess is it will be even harder to get any bag than before. I don’t think we stand a chance against resellers who purchase bags for living, they will likely occupy H stores all the time to snap up every last bag they can get their hands on.

At least this is why I think the non-QBs (Evelyn, GP, picotin, etc that were easily available few years back then) are harder to come by nowadays.

Look at the H official online shop in some countries, bags are sold minutes or even seconds as soon as the stock pop up on the website. Resellers use programs to buy the bags (hence H implemented purchase quota and the identity verification step many of us here complained). People subscribe to paid service to get notifications whenever new stock shows up on H online shop.

Imagine the situation if H is obliged to sell a Birkin to everyone coming in demanding for one but they only have limited quantities. Just my thoughts.

 

[CTLover]

I would assume Hermes corporate is lawyered up enough to not get caught but there is no way they don’t know about these practices. And if they *wanted* to discourage it, they could pay sales people commission on the quota bags and then there would be no more “quota bags”. But they don’t, so that tells us a lot.

But that kind of practice is not illegal, and promotes sales, so of course they won't discourage it. And, in sales, the concept of offering more commission on some products and little or none at all on the "hot" products is pretty standard. So, that really doesn't prove anything. Car dealers do it all the time. Generally you offer salespeople commission perks on the harder to move stuff. Stuff that sells itself needs little inducement to sell.

 

[LaurenHermesLover]

Let’s say the written proof does exist in form of a screenshot from the SA that says ‘I think you need to spend more money before a Birkin happens for you.’

I do wonder if they would have to prove this is not one SA going rogue. Hermes has an explicit policy banning SAs from upselling customers on non-quota-bag items to get a Birkin. SAs have been fired for it.

I am not too worried about Hermes’ ability to fight the lawsuit. I am intrigued by the health of the business where such a large portion of the sales comes from people establishing their history, whether it is explicitly or implicitly to get a quota bag.

You are correct. Then this would trickle into respondeat superior and if H is responsible for the employee in this situation. I think H could claim that they aren’t liable for employee negligence because of the employee was “going rogue” and saying things not considered in the scope of their employment (if they could back up that it’s against their policies, training, etc) because the actions “substantially deviate” from regular employment duties. Also, the plaintiffs would have to prove “harm” and I think that’d be tricky.

The point of the lawsuit is the tying aspect. I am not saying that prespend is or is not real, but in my experience, prespend is just one data point of competitiveness between myself and other consumers vying for the same limited item. And not even the most important datapoint, which, again it’s only my opinion, but it’s length of time as a loyal customer. If the end goal of H is to try to get limited bags in the hands of end-users (not resellers), then their system just aggregates data points to see who a coveted bag should go to at a given time. I don’t think a prespend qualifies as a tying agreement. Again, only one opinion here!

 

[CTLover]

You are correct. Then this would trickle into respondeat superior and if H is responsible for the employee in this situation. I think H could claim that they aren’t liable for employee negligence because of the employee was “going rogue” and saying things not considered in the scope of their employment (if they could back up that it’s against their policies, training, etc) because the actions “substantially deviate” from regular employment duties. Also, the plaintiffs would have to prove “harm” and I think that’d be tricky.

The point of the lawsuit is the tying aspect. I am not saying that prespend is or is not real, but in my experience, prespend is just one data point of competitiveness between myself and other consumers vying for the same limited item. And not even the most important datapoint, which, again it’s only my opinion, but it’s length of time as a loyal customer. If the end goal of H is to try to get limited bags in the hands of end-users (not resellers), then their system just aggregates data points to see who a coveted bag should go to at a given time. I don’t think a prespend qualifies as a tying agreement. Again, only one opinion here!

Again, I think "pre-spend" has more to do with the client that comes in and makes it known they're only there for a Birkin, and will likely disappear once they obtain their holy Grail. Also, why should someone just be able to walk into an Hermès boutique, with no history or ever buying anything from the brand and get a Birkin? That would be every resellers dream and make bags even more scarce for those of us who don't buy other products just to get a Birkin, but because we actually love the scarves, shoes, etc.

 

[horselove]

I am excited to see how this will unfold. Fight, fight, fight! (It’ll be disappointing if Hermes settles)

 

[Veritybelle]

View attachment 5970027

What plaques are you referring to?

I meant the signs on the checkout desks like the example above posted by @880

 

[loh]

I hope the lawsuit gets kicked out and H is awarded costs and fees. What a frivolous first-world case.

And if, somehow, the matter proceeds and actually gets to the jury, I can't imagine how sympathetic the plaintiffs are going to come across to a jury. Albeit the jury pool in the Northern District of CA may be a bit more educated and affluent, and heck maybe even some of the potential jurors have unsuccessfully tried themselves to get a B/K (in which case they should be struck), but I still can't imagine that a jury is going to be swayed by grown adults crying over not being able to purchase a 5-figure bag and deem this a matter where they are entitled to damages, versus as one said, a giant adult temper tantrum.

And, no I don't think they should settle either.

 

[umamanikam]

They act very entitled ,rich and used to getting their own way ." Why should we act like mere mortals and buy all the stuff in the boutique when we have the money to throw ".

 

[S0nia]

not really denying as there is an entire thread dedicated to it where people have shared their experiences, or asked for advice on how to navigate it.

it's more of stating the difficulty of proving it in court considering how it's only done verbally, or implied in some cases. also because it varies from store to store, or even customer to customer within the same store.

*YES*, emphatically *YES*, there are people denying pre-spend, telling you there is no pre-spend, fighting against the very notion of pre-spend, saying it is not true.
And the reason is, it is illegal yet it is happening. So... cover-up and gaslighting.

 

[S0nia]

The fact is, a judge might be interested to take up the case for the precedent; this kind of shady practice occurs on the down low in luxury cars, in luxury watches etc.

Pretty sure linked sales are illegal. In France it is for sure. Hence those stupid signs "We do not practice what you and I full damn well know we practice. Please act accordingly."

Once something is illegal, I don't think you need to prove harm, you should just have to establish that it happened, i.e. the law was broken. Also, the law does not care about rich or poor. It applies to all. Breaking the law is for all, rich or poor. You do not get to kill, rape, steal, violate rights etc. just because you are rich or you are poor.

Saying a matter is frivolous just because the items in questions are expensive trinkets show poor understanding of legal matters which should concentrate on principles and standing. Why would a court rule on metabirkins then? How frivolous is that? Well, the issue here is IP, not the frivolity of the object in question.

Is Hermès breaking the law with pre-spend, yes or no. That is the issue.

Actually I pray the court takes up the case and Hermès comes in saying they do NOT practice pre-spend. What a firecracker that would be! All the dirty laundry would come right out for all to see!!

 

[WingNut]

I hope the lawsuit gets kicked out and H is awarded costs and fees. What a frivolous first-world case.

And if, somehow, the matter proceeds and actually gets to the jury, I can't imagine how sympathetic the plaintiffs are going to come across to a jury. Albeit the jury pool in the Northern District of CA may be a bit more educated and affluent, and heck maybe even some of the potential jurors have unsuccessfully tried themselves to get a B/K (in which case they should be struck), but I still can't imagine that a jury is going to be swayed by grown adults crying over not being able to purchase a 5-figure bag and deem this a matter where they are entitled to damages, versus as one said, a giant adult temper tantrum.

And, no I don't think they should settle either.

I'm mean. If I were a juror I'd show up carrying the Birkin I didn't need prespend to buy.....