Most of us have seen the ads – claiming deep discounts on a product for a limited time.  One such wine reseller – Wines Til Sold Out – is facing claims in the U.S. District Court of New Jersey that it defrauded customers by offering wines for discounted prices that were not based on the wines’ true value.

WTSO was launched in 2006 and is owned by brothers Elliott and Joe Arking, according to their website.  Its deals are offered one at a time, beginning at midnight eastern time each day, and going until the particular offering is sold out. According to the Company, they vet their prices using online search tools, excluding auctions and pre-arrivals, to find the lowest price available online, and lump the cost of the wine and shipping into the final price offered to customers.

According to the Complaint, a WTSO offer, delivered to a customer’s email account or mobile device, will typically list the wine as well as an original price, the best price found through a recent web search noted above, and WTSO’s offer. The focus of the complaint, however, are certain offers that list an original price and an offer price, but for which the web price is just listed as “N/A.”  The complaint argues that further research of nearly 30 offers structured in this manner showed that the wines were only available from WTSO, and that many of the brands were produced solely for WTSO through private-label companies.  The plaintiffs claim that because the wines were not actually available anywhere else online, the reference to only an “original price” and WTSO’s offer are a deceptive inducement to entice consumers to buy the wine. The plaintiffs also allege that WTSO inflated prices for well-known brands  to make their discounted prices appear more appealing.

WTSO initially sought to have the complaint dismissed on a procedural argument, but a judge recently gave the plaintiffs time to amend the complaint by January 27 to address the alleged defects, and continue their case against WTSO.  Depending on how it is resolved, the case could have broader implications for online marketing strategies.


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