Suit: Costco Pulling Bait-and-Switch with Michael Kors Bags


Wouldn’t it be nice to pick up a Michael Kors (NYSE:KORS) bag as a Mother’s Day present, and pay only $99?

According to a lawsuit filed filed in Manhattan court on Friday, Costco (NASDAQ:COST) was offering customers this very deal in an email sent in advance of the day celebrating American motherhood. Unfortunately, Michael Kors staff could not find any of the designers bags in Costco stores and is suing the warehouse club retailer for pulling a bait-and-switch routine. It is the second such claim against Costco so far this year.

Reuters reports Michael Kors Holding Company filed the complaint against Costco, alleging the designer’s handbags — which run from $295 to $1,195 in Michael Kors stores — were being used as bait to get shoppers inside Costco stores. The suit aims to prohibit Costco from advertising Michael Kors products and recover profits, plus damages, for the retail wholesaler’s offenses.

“When a consumer ‘takes the bait’ and seeks to purchase Michael Kors handbags at a Costco store or on Costco’s website, no such handbags are available,” the complaint reads. For Costco, it marks the second such suit to come up this year.