In Boundas et al. v. Abercrombie & Fitch Stores Inc, No. 10-04866 (N.D. Ill. March 7, 2012), the Northern District of Illinois certified a class action lawsuit against Abercrombie & Fitch brought by unhappy shoppers who claim that Abercrombie voided holiday gift cards that said they had no expiration date.
In December 2009 Abercrombie issued nearly 200,000 gift cards valued at $25 each as part of a promotion to shoppers who spent at least $100 on a single purchase. Abercrombie voided the cards around Jan. 30, 2010 claiming that the cards were enclosed in sleeves containing that expiration date.
Abercrombie argued that the class should not be certified and that the cardholders should be forced to sue separately because the potential class members were too different from one another to sue as a group. Abercrombie argued that some people got their cards in stores and others online, and some with the sleeve and some without. Abercrombie also argued it would be impossible to find some plaintiffs.
The Court disagreed and found that it was fair to certify a class of plaintiffs who still hold the cards and plaintiffs who discarded the cards after being told they had expired or were void.
The Court held that the claim to be tried is whether Abercrombie committed breach of contract when it voided the gift cards. The subsidiary issues and defenses are (1) whether Abercrombie was contractually obligated to honor the promotional gift cards; (2) if so, whether the terms are set forth on the gift card alone, the sleeve alone, or the card plus the sleeve; and (3) if the terms are set forth on the card plus the sleeve, whether the card trumps the sleeve or vice versa.
Take away: While gift cards that are provided as an inducement (such as for a rebate) can have short expiration dates (as opposed to purchased gift cards), companies must still be sure to clearly disclose the terms of the expiration date. Companies that want to have gift card promotions should ensure that the expiration date of the gift card is clearly set forth on the gift card itself and not rely on a sleeve or some other document with an expiration date which could mislead consumers.