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Late Delivery: Online Fashion Store Can’t Keep Customers’ Money when It Fails to Promptly Ship Goods

  • The FTC reached a settlement with online fashion retailer Fashion Nova, Inc. to resolve allegations that it did not provide consumers with a chance to cancel their orders and obtain a refund when it failed to ship merchandise in a timely manner in violation of the FTC Act and the Trade Regulation Rule Concerning the Sale of Mail, Internet, or Telephone Order Merchandise (“Mail Order Rule”).
  • The FTC’s complaint alleged that Fashion Nova regularly failed to meet its shipping promises to consumers and failed to notify consumers of shipping delays. Fashion Nova also did not give consumers an opportunity to cancel their late orders and sent a gift card instead of a refund.
  • Under the terms of the proposed stipulated order, Fashion Nova will pay $9.3 million in refunds to harmed consumers, is enjoined from violating the Mail Order Rule, and required to ship ordered merchandise within one day from the date of purchase if the company does not specify a shipping date.