On Monday, the lingerie, loungewear and activewear brand agreed to pay $1.2 million to settle a consumer protection lawsuit for misleading consumers.
The lawsuit — originally filed in August in three California district attorney’s offices, in addition to the Santa Monica City Attorney’s Office — claimed that the brand cofounded by the megastar failed to inform VIP members about recurring charges in its subscription program. The brand also did not receive the proper consent for automatic renewal fees. In addition, the lawsuit alleges that the retailer incorrectly advertised prices and how to use store credit to purchase goods.
“Consumers have a right to know up front what they are paying for and how often,” Deputy District Attorney Jennifer Deng said in court documents issued by the City of Santa Clara’s Office of the District Attorney. “Businesses have a duty to be transparent about their automatic renewal charges.”
Under California law, consumer-facing internet businesses must disclose all automatic renewal charges “clearly and conspicuously,” according to documents from the Office of the District Attorney. The lawsuit claimed that VIP members were charged after their initial enrollment fees, even if they didn’t purchase additional products. Shoppers who later canceled their membership did not receive a full refund, according to the lawsuit.
Representatives from Savage x Fenty responded with a statement saying: “At Savage x Fenty, we believe in transparency, which is why we are sharing that we settled with the California District Attorneys in their investigation of our website and advertising practices. As part of the settlement, we agreed to make clarifying changes to our website and set aside $140,000 to provide refunds to eligible California consumers, among other things. For us, the focus has always been on serving our customer. We remain committed to our flexible membership program and delivering unparalleled quality and value through it to our million-plus members worldwide.”
Per the terms of the settlement, the company agreed to pay $1 million in civil penalties, $50,000 in investigative fees and $150,000 in restitution to previous or current California VIP members.
In addition, the firm made changes to its website, automatic renewal notices, store credit and advertising methods, and cooperated with the investigation, according to court documents.
Savage x Fenty has grown rapidly since 2018 — when Rihanna launched the brand online (with the help of TechStyles Fashion Group) as a women’s intimate apparel label — thanks to a mix of inclusive offerings, investor funds and Rihanna’s star power.
Last month, the firm expanded into sportswear under the creative direction of designer Adam Selman. There’s also loungewear and men’s innerwear. Earlier this year, the brand, which has since separated from TechStyles, expanded into physical retail.