Home furnishings retailer Arhaus Inc. has agreed to pay $6 million to resolve a class action lawsuit that accused the company of false advertising and misleading sales claims.
The settlement benefits California consumers who purchased items from Arhaus’ home furnishings website between April 2, 2020, and September 18, 2024, where a product listed both a sale price and an inflated original price or reference price.
The lawsuit alleged that Arhaus misrepresented its prices, violating consumer protection laws by creating the illusion of large discounts.
Background of the Class Action Lawsuit
Plaintiffs filed the class action in the United States District Court for the Central District of California (Moses et al. v. Arhaus Inc., Case No. 8:24-cv-00728-FMO-ADS).
The complaint argued that Arhaus’ pricing practices violated state statutes protecting consumers from false advertising and transparency in pricing violations.
Consumers said they were enticed by home furnishings items like sofas, rugs, and dining sets labeled “on sale,” when in fact, those discounts were based on inflated original prices that had never been charged.
This case reflects a broader pattern of Class action lawsuits targeting retailers for misleading sales claims and deceptive “compare-at” pricing tactics.
Arhaus Settlement Amount and Terms
Under the terms of the settlement, Arhaus will pay a settlement amount of $6 million into a fund for distribution to qualified Class Members.
Those eligible can choose either a cash payment or a store credit gift card, depending on purchase history and documentation.
The agreement also includes commitments by Arhaus to improve its pricing transparency, ensuring that future promotions comply with California’s consumer protection and false advertising laws.
Who Qualifies for Payment
Class Members include California residents who purchased products from Arhaus.com between April 2, 2020, and September 18, 2024, where both a current sale price and a higher reference price appeared on the product listing.
To qualify:
- Buyers must not have received a prior refund or credit.
- Proof of purchase such as receipts, order confirmations, or payment statements must be submitted.
- Claims must be filed before December 19, 2025.
Those unsure of eligibility can review FAQs on the Settlement Administrator’s website, which details class action rebates and documentation requirements.
Key Dates to Remember
- Claim Submission Deadline: December 19, 2025
- Exclusion or Objection Deadline: December 19, 2025
- Final Approval Hearing: February 19, 2026
- Court: U.S. District Court, Central District of California
After court approval, the Administrator will process valid claims and issue cash payments or store credit gift cards.
Claims Process and Proof Required
The class action allows members to receive compensation without appearing in court. Claimants must submit a form with their Arhaus order number, proof of purchase, or relevant receipts.
All forms are submitted under penalty of perjury to ensure authenticity.
Those who file fraudulent or duplicate claims may lose eligibility and delay payments to other consumers.
California’s Consumer Protection and False Advertising Laws
California’s consumer protection framework including the False Advertising Law (FAL) and the Unfair Competition Law (UCL) requires retailers to display prices truthfully.
Displaying original prices that were never actually charged is considered false advertising.
Courts have repeatedly held that such conduct deceives buyers and distorts fair market competition. The Arhaus class action joins other Class action lawsuits involving retail pricing practices across multiple industries.
Transparency in Pricing and Ethical Retailing
The Arhaus case reinforces the need for transparency in pricing. Companies must disclose accurate pricing histories, not inflated or hypothetical “list” values.
Retailers found in violation risk significant penalties and reputational harm. The Federal Trade Commission and California regulators continue to monitor misleading sales claims and false advertising that mislead consumers into purchasing home furnishings and other goods.
This settlement reminds businesses that modern consumer protection laws prioritize honesty, fairness, and full disclosure in marketing.
Arhaus’ Response
Arhaus has denied wrongdoing, asserting that the class action was settled to avoid litigation costs and uncertainty. The company emphasized that it remains committed to ethical business practices and fair treatment of customers.
While Arhaus did not admit liability, the company agreed to improve its pricing systems and adopt compliance reviews to prevent future false advertising allegations.
Legal and Financial Impact
For consumers, this class action settlement provides a meaningful remedy. Many online shoppers rely on reference prices to judge value. When those figures are inflated, customers pay more than they should, an unfair trade practice that falls squarely under consumer protection statutes.
Attorneys involved in the case said the outcome serves as a deterrent for future false advertising schemes across the home furnishings and retail sectors.
Why This Settlement Matters
The Arhaus class action not only compensates affected buyers but also signals that courts will not tolerate deceptive promotions.
It adds to a growing list of Newly Settled retail cases and reinforces the importance of corporate responsibility in advertising.
For consumers, this case shows that Class action lawsuits remain one of the most effective ways to hold companies accountable for false advertising and violations of transparency in pricing.
Class Actions and Consumer Awareness
Many consumers are unaware of how class action rebates work. These settlements allow large groups of people with similar losses to recover funds efficiently without filing individual suits.
Such legal actions also bring attention to privacy violations, Data Breaches, and other issues related to consumer protection and data misuse without consent.
Though this case focuses on false advertising, it aligns with broader trends of holding corporations accountable for transparency and fair marketing.
Connection to Broader Consumer Trends
Recent Newly Filed and Newly Settled lawsuits show how industries ranging from automobile brands to Procter & Gamble have faced scrutiny for misleading promotions and defective consumer healthcare products.
Even companies like State Farm and Quest Diagnostics have settled major class actions related to Cyber Attack incidents or insurance payments. These diverse cases share one principle: protecting consumer rights through the class action mechanism.
Digital Advertising and Privacy Context
As online shopping expands, compliance extends beyond pricing to include privacy. Many retailers collect data for interest-based advertising, requiring clear options to opt out through website settings or a Privacy Policy page.
California’s strong privacy laws including the California Consumer Privacy Act (CCPA) and similar measures support transparency and user choice in targeted advertising.
While the Arhaus case centers on false advertising, it reinforces the same public expectations for transparency, fair dealing, and consumer protection online.
Lessons for Consumers
Consumers can learn from this settlement by:
- Reading price disclosures carefully.
- Reporting false advertising or misleading sales claims.
- Tracking class action opportunities for compensation.
- Understanding their rights under consumer protection statutes.
Participating in class actions like the Arhaus settlement helps promote fairness and transparency in retail markets.
About Ted Law
At Ted Law Firm, represents consumers nationwide in false advertising, consumer protection, and class action litigation.We serve families across Aiken, Anderson, Charleston, Columbia, Greenville, Myrtle Beach, North Augusta and Orangeburg.The firm holds corporations accountable for deceptive pricing, transparency in pricing failures, and other unfair trade practices.Contact us today for a free consultation.
