Attorney for House of Brides, Inc. James K. Borcia states, “We are alleging House of Brides was terminated as an authorized Alfred Angelo retailer because of its refusal to agree to sell the dresses at the
Chicago, Illinois (PRWEB) March 20, 2012
· Breach of Contract
· Breach of the Implied Warranty of Merchant Ability
· Violations of the Sherman Antitrust Act
· Violation of the Robinson Patman Act
· Violation of the Illinois Antitrust Act
· Tortuous Interference with Business Expectancy
The action follows a 5-year dispute between the parties. Court documents state the retailer is alleging the manufacturer participated in numerous illegal activities, including price-fixing. House of Brides claims that these actions resulted in serious and substantial harm to the retailer and subsequently, the consumer.
According to court documents, Alfred Angelo introduced a Marketing Policy with intent to force compliance at the same time it was opening its own retail stores. Attorney for House of Brides, Inc. James K. Borcia of Tressler, Soderstrom, Maloney and Priess, LLP, states, “We are alleging House of Brides was terminated as an authorized Alfred Angelo retailer because of its refusal to agree to sell the dresses at the prices dictated by Alfred Angelo.”
Attorneys for House of Brides also noted a disruption in service prior to Alfred Angelo ending its relationship with House of Brides. Documentation was provided to the court showing the manufacturer shipped defective or duplicate merchandise, incorrect customer orders and late shipments of customer orders. Court documents state the manufacturer also refused to accept returns on this merchandise despite their errors. As a result, House of Brides was forced to reimburse customers for orders. Thus, the retailer suffered severe financial damages and injury to their reputation.
House of Brides established its first brick-and-mortar salon in Cicero, Illinois in 1929. 83 years later, the retailer has 11 Illinois stores. House of Brides launched its global E-Commerce website, houseofbrides.com in July 2002.
The retailer shared a relationship with Alfred Angelo for over 40 years prior to the lawsuit. During this time, House of Brides was the manufacturer’s largest account in the world. The retailer offered the wedding, bridesmaid, flowergirl and special occasion collections for sale in-store and online. The collections were featured on the website since its launch date in 2002.
House of Brides’ website is among the first to post retail prices, which allows customers to easily comparison shop in-store and online.
The site sells designer collections up to 80% off retail prices. The retailer is the largest supplier of their manufacturers worldwide. Due to the high volume of business, the retailer receives manufacturer discounts. They then use these discounts to lower prices for the consumer.
During the early 2000s, Alfred Angelo began opening its own retail stores, which exclusively sold their merchandise. The frequency increased throughout the decade. Presently, the manufacturer has 67 stores nationwide.
According to Court Case Number 11 CV 07834, the manufacturer put a Marketing Policy in to effect January 2004. Court documents state the policy solicited authorized retailers to no longer discount their products with the intent to eliminate or suppress price competition among retailers. Documents show the policy implemented a mandatory minimum retail pricing policy, which dictated the retail price. The court documents cite the policy also threatened to terminate retailers who did not comply. House of Brides sold Alfred Angelo collections online and at a discount with Alfred Angelo’s knowledge without contest long after the Marketing Policy went into effect.
In court documents, House of Brides continued operations without notice or knowledge of the Marketing Policy until January 2007. Upon notification, the retailer declined to adhere to Alfred Angelo’s mandatory prices, stating it was unfair to restrict their ability to compete and offer the customer the best prices possible.
The manufacturer sent a letter in April 2007 stating it would terminate the account if the retailer did not agree to the Marketing Policy as stated in court documents. The retailer again declined to comply.
Alfred Angelo reissued the Marketing Policy November 2010. It established a Manufacturer Suggested Retail Price (“MSRP”) and Minimum Pricing Policy (“MPP”). The MSRP represented the expected retail price for online retailers. The MSRP reflected a mark-up of up to 250% above the wholesale cost.
The MPP represented the minimum price allowed in brick-and-mortar stores and excluded online retailers. The MPP is a mark-up of 200% above wholesale and vastly less than the MSRP.
Online retailers were thus not permitted to sell or compete with retail stores. Adherence to these fixed minimum prices would lead to higher retail prices for consumers.
Court documents show House of Brides again declined to fix their prices. The Internet site would no longer be able to compete against brick-and-mortar stores selling at the MSRP and less than the MPP. This included the inability to compete with Alfred Angelo’s own retail stores, which have been growing in number in recent years and are in direct competition with retailers such as House of Brides.
It is cited in the court documents, the manufacturer sent another letter in May 2011 stating it would cease supplying bridesmaid dresses for customer orders. Operations continued, however, attorneys for House of Brides contend there was a disruption in service supported by court documents, which included inferior merchandise and late shipments.
Court Case Number 11 CV 07834 states that in August 2011, Alfred Angelo terminated its relationship with House of Brides due to what House of Brides believes was its refusal to sell the dresses at Alfred Angelo’s fixed prices. Later all shipments were stopped by Alfred Angelo, including on orders on which House of Brides had taken orders. The retailer was forced to reimburse hundreds of undelivered orders causing irreputable damage to House of Brides’ brand and emotional and mental distress to its customers.
Attorneys for House of Brides, Inc. filed the $30 million plus dollar lawsuit in the United States District Court for the Northern District of Illinois Eastern Division in Chicago, Illinois. Court Case Number 11 CV 07834 was filed on February 15, 2012.
About House of Brides:
House of Brides established its first brick-and-mortar store in 1929 and has since grown to 11 Chicagoland stores and global E-Commerce website, http://www.houseofbrides.com. Millions of Brides and their wedding parties visit the salons and global website for over 30,000 wedding and special event products.