[Editor's Note: In this Jan. 2, 1996 complaint, the company that operates Victoria's Secret Catalogue is charged with discriminatory sales practices. Denise Katzman from New York claims that the lingerie company pads its discounts offered to men. At issue is a mailing that offered $25 off any purchase of $75 or more to men and $10 off the same purchase to women. She said that such pricing is considered racketeering under a federal RICO statute.]
filed by:
HOWARD GOTBETTER
Attorney for Plaintiff
100 Central Park South
New York, NY 10019
(212) 316-0968
United States District Court
Southern District of New York
PLAINTIFF
DEMANDS TRIAL
BY JURY
Denise Katzman, for and on behalf of
herself, and on behalf of all others
in the class similarly situated,
Plaintiff,
v.
Victoria's Secret Catalogue, division
of The Limited Inc.
Leslie H. Wexner,
Edward G. Razek,
Cynthia Fedus,
Betsy Hendrickson,
Defendants.
PLAINTIFF COMPLAINING OF DEFENDANTS ALLEGES:
1. Plaintiff is an adult female resident of the City, County and State of New York in this District.
2. Upon information and belief:
A. Victoria's Secret Catalogue is a division of The Limited Inc. which is a corporation organized and existing under Delaware law with principal office in Ohio doing business in this district.
B. Leslie H. Wexner is the president and controlling executive in charge of Victoria's Secret Catalogue ("VSC") and The Limited Inc. ("Limited") doing business in this district.
C. Edward G. Razek is a vice president and director of marketing for VSC and Limited and makes decisions respecting how and where and to whom mailings by VSC occur and does business in this District,
D. Cynthia Fedus is president of VSC and makes decisions respecting how and where and to whom mailings by VSC occur and does business in this District,
E. Besty[sic] Hendrickson is director of merchandising of VSC and makes decisions respecting how and where and to whom mailings by VSC occur and does business in this District.
3. This Court has jurisdiction of this action pursuant to the Racketeer influenced and Corrupt Organizations Act ("RICO") 18 U.S. C. Sec. 1961 et. seq. and under 18 U.S.C. Secs. 1341 and 1343 ("Mail Fraud Statute") and jurisdiction and 28 U.S. C. Sec. 1338. Jurisdiction also exists in this Court in that this is an action between citizens of different states, 28 U.S.C. Sec. 1332(a), and the amount in controversy is in excess of $50,000.00 exclusive of interest and costs.
4. Venue lies in this district under 28 U.S. C. Sec. 1391(b) and 28 U.S.C. 1391 (c) in that the claims arose in this District and defendants do business in this District as heretofore alleged.
5. In December 1995 plaintiff received in the mail a catalogue (CAT-1) from VSC entitled "WINTER 1996" which stated on the front cover "Take $10 Off" "Any Purchase of $75 Or More. See Order Form For Details."
6. On the back cover plaintiff's name appeared and the designation "OR CURRENT RESIDENT" together with a box headed SOURCE CODE: with the following: WS165726.
7. Upon information and belief the aforesaid SOURCE CODE: designated plaintiff as a female in a certain income category with a defined disposable income potential and fitting a demographic pattern.
8. Said order form in CAT-1 stated: "OFFER: Deduct $10 on any purchase of $75 or more. This offer is valid for catalogue clients, this issue only."
9. Upon information and belief the aforesaid catalogue was sent by VSC by mail to numerous females fitting into the demographic pattern and income category in the same class as plaintiff.
10. Upon information and belief defendants and each of them and all of them targeted plaintiff and those in her class with a so-called "$10 Off" Offer for purchases made from said catalogue of $75 Or More.
11. Upon Information and belief defendants and each of them and all of them prepared another catalogue (CAT-2) in December 1995 which was similar to CAT-1 but stated that the recipient of CAT-2 could: "Take $25 Off" "Any Purchase of $75 Or More. See Order Form For Details."
12. Said order form in CAT-2 stated: "OFFER: Deduct $25 on any purchase of $75 or more. This offer is valid for catalogue clients, this issue only."
13. Upon information and belief CAT-2 was mailed to and received by male adults whom defendants presumed would be interested in purchasing merchandise from CAT-2 and enticed to make a purchase of at least $75 and receive a $25 deduction therefrom.
14. Upon information and belief the source code for CAT-2 mailed to an adult male recipient listed in the box under SOURCE CODE: the following "WS164405" meaning that the recipient of CAT-2 was an adult male with a higher income level than plaintiff fitting into a different demographic pattern than plaintiff and not in plaintiff's class.
15. Based upon a comparison of the offers contained in CAT- 1 and in CAT-2, plaintiff and her class have been and are being deprived of equal opportunity to receive a larger price discount and deduction than the class to whom CAT-2 was mailed resulting in discrimination against plaintiff and her class by each and all of defendants.
16. Upon information and belief defendants and each of them and all of them intentionally, knowingly and wantonly prepared and mailed CAT-1 to plaintiff and those in her class with total knowledge that the offer in CAT-1 discriminated against plaintiff and her class when compared with the offer in CAT-2 of a higher discount and deduction when the merchandise offered in both catalogues was the same.
17. Defendants and each of them and all of them participated in the creation and production and selection of merchandise and discount and deduction levels in CAT-1 and CAT-2 and in the selection of those recipients of each catalogue to each intended person in each targeted class totally cognizant of the discrimination involved.
18. This is not the first time defendants have mailed to various unsuspecting consumers and prospective customers catalogues which have different offers for the same merchandise preferring one class of consumers over another class over the same time period.
19. Upon information and belief in 1994 and 1995 defendants and each of them and all of them prepared two versions of the same catalogue offering by mail the same merchandise to different classes of consumers and recipients at different prices for the same items. This insidious and discriminatory practice was the subject of a news story on the CBS television station covering the tristate New York- New Jersey-Connecticut area. Defendants admitted the aforesaid nefarious improper practices and claimed such was a mistake due to a "test marketing" promotion which went astray and promised never to do it again.
20. Based upon the current and assumed continued future mailings of CAT-1 and CAT-2 set forth herein previously, it is obvious that defendants and each of them and all of them have embarked upon and continue a campaign over the past years to deceive consumers and prospective customers and to arbitrarily divide them into stereotypical classes and discriminate against those class and members thereof.
21. The acts and activities of defendants and each of them and all of them have impacted upon plaintiff and the class in which plaintiff is a member and will continue to impact upon plaintiff and members of her class and discriminate against them and damage them.
22. Defendants and each of them and all of them have acted together and are continuing to act together and upon information and belief will continue to act together as part of a planned continuing pattern of activity and as part of a continuing enterprise done through a continuing pattern of illegal activity and in continuing violation of laws.
23. Upon information and belief defendants and each of them and all of them have violated and will continue to violate as part of a devious continuing plan and pattern the rights of plaintiff and members of her class unless prevented by this court.
24. Upon information and belief the acts and activities of all defendants have constituted a series of continuing illegal and predicate acts in violation of the RICO statute and such acts and activity shall be considered racketeering activity under the RICO statute, and that such activities and acts by and through defendants will continue into the future.
25. Plaintiff brings this action on behalf of herself and all other members of her class (heretofore described) who have been solicited by mail by defendants and sent CAT-1 and deprived of an opportunity to receive a $25 deduction instead of a $10 deduction on a $75 purchase.
26. The claims made by plaintiff herein are typical of the claims had by the members of the class to which plaintiff belongs and this action by plaintiff will fairly and adequately protect the rights and interests of such class and its members.
27. This is a class action brought by plaintiff as set forth above pursuant to Rule 23 of the Federal Rules of Civil Procedure.
28. The class concerned is so numerous (upon information and belief many thousands of members exist) that joinder of all members is impractical and they are unknown to plaintiff at this time.
29. Plaintiff will adequately protect and fairly protect the interest of all class members whom plaintiff represents.
30. There are questions of law and fact common to the class and the rights and remedies possessed by the class and the claims set forth by plaintiff herein are typical of the claims that each member of the class could assert against each and all of defendants herein.
31. Additionally as stated in Rule 23 (b) this class action is proper and feasible in that this action can dispose of the issues which affect plaintiff and members of her class and defendants rather than by the prosecution of separate actions by individual members of the class which might or would create a risk of inconsistent or varying adjudications with respect to some individual members of the class which would establish incompatible standards of conduct for any or all defendants opposing the class. Further this class action is superior to other available methods for the fair and efficient adjudication of the controversy since questions of law and fact common to the members of the class predominate over any questions affecting only individual members of the class.
32. Plaintiff and upon information and belief members of her class would have bought merchandise from CAT-1 had it not been for the discovery of the larger discount or deduction available to those who could buy the same merchandise from CAT-2.
33. Defendants and each of them and all of them represented to plaintiff and members of her class that the discounts and deductions and prices set forth in CAT-1 were the best available when defendants knew that such representations were false and misleading and that plaintiff and members of her class would be induced to rely and rely thereon and suffer damages by overpaying when compared with the discounts and deductions available as set forth in CAT-2.
34. Upon information and belief defendants and each of them and all of them mailed and caused the mailing of over one million CAT-1 catalogues to members of plaintiff's class and over one million CAT-2 catalogues to others.
35. Upon information and belief over one hundred thousand member of plaintiff's class have bought and will buy merchandise from CAT-1 and be deprived of $15 additional savings. As a result thereof defendants VSC and Limited have improperly and fraudulently taken and mulcted over $1,500,000 from class members which must be disgorged.
36. There is no conflict as between plaintiff and any other member of the class with respect to this action or with respect to the relief sought herein and plaintiff is willing and able to protect and vindicate the interests of the class herein and its members.
WHEREFORE PLAINTIFF DEMANDS RELIEF AS FOLLOWS AGAINST DEFENDANTS AND EACH OF THEM AND ALL OF THEM AND THEIR AGENTS, EXECUTIVES AND EMPLOYEES:
A. That they be enjoined permanently and forever from mailing and disseminating false and fraudulent and misleading catalogues;
B. That they send forthwith to all persons who received CAT-1 a copy of CAT-2 and make it available to such persons the higher discount and deductions available previously only to CAT-2 recipients;
C. That they refund forthwith the sum of $15 to each and every person who bought from CAT-1 and received only the $10 discount and deduction on a $75 order, or give each such person the option and choice of taking a $15 credit to be used against future purchases of merchandise from future catalogues without any time and other restrictions and limitations and without the imposition of any cost and expenses for shipping and handling for new orders using said credit;
D. That they be assessed and made to pay damages and punitive damages in sums to be determined by a jury at trial and that all sums so awarded by divided amongst and paid over in equal portions to all members of the class;
E. That they account for and pay over in equal portions to all members of the class a sum equal to $15 multiplied by all those persons to whom CAT-1 was mailed;
F. That they pay to plaintiff and plaintiff be awarded attorney's fees in accordance with prevailing law;
G. That they be made to publicly apologize world-wide via newspapers, television, radio and the internet for the deceptions practiced at times and in such manner as determined by a jury at trial herein;
AND that plaintiff and the class represented by plaintiff have such other and further and different relief at law and in equity and otherwise as may be just and proper in the premises plus (where appropriate) interest, costs and disbursements.
