HP has agreed to pay $4 million to settle a class-action lawsuit accusing the company of “false advertising” and “misleading” customers on its website. The plaintiffs alleged that the PC and peripherals maker violated Federal Trade Commission rules prohibiting deceptive pricing, specifically displaying an “artificially inflated price” while offering a fictitious discount.
The initial class action complaint, filed on October 13, 2021, accused HP of misleading customers by artificially inflating the prices of PCs and peripherals. On July 15, 2022, the complaint was amended to allege that it violated Federal Trade Commission rules prohibiting deceptive pricing, specifically using an “artificial, inflated price” to make an advertised discount appear greater than it actually is.
«”To sell more products and maximize profits, HP displays misleading strikethrough prices on its website and advertises fictitious savings based on those prices. The strikethrough prices are misleading because they do not reflect the actual prices at which HP regularly sells its products. The savings are fictitious because they do not reflect the actual savings realized by customers,” the lawsuit says.
Image source: HP
The plaintiffs alleged that “HP harms consumers by inducing them to pay more for its products and to make purchases they would not otherwise make.” They argued that HP’s strikethrough prices also harm competition by giving HP an unfair advantage over other computer makers that do not use the practice: “A customer is more likely to purchase a $2,000 computer advertised at 50 percent off the regular price than to pay full price for a $1,000 computer.”
HP also faced criticism for weekly offers that used social engineering, such as low-stock alerts that would entice customers to buy. According to the lawsuit, HP continued to sell these items in the following weeks and months, meaning they were in sufficient stock. Another point of contention was HP’s false advertising of limited-time offers, sometimes with countdowns.
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It’s safe to say that HP got off lightly. The $4 million the court ordered the plaintiffs to pay is a drop in the bucket compared to the amounts HP earns — the company’s revenue for the first quarter of 2025 was $13.5 billion. In addition, HP did not have to publicly admit to violating the law and misleading customers, which could have served as bad publicity for the company.