North Carolina has secured a significant settlement of $4.8 million from TFG Holding, Inc., the parent company of online clothing brands such as JustFab, ShoeDazzle, and FabKids. This resolution comes after allegations of deceptive marketing practices, as stated by North Carolina Attorney General Jeff Jackson on Tuesday.
A coalition of 33 attorneys general, including Jackson, initiated the lawsuit against TFG Holding for allegedly misleading consumers regarding its VIP membership program. The retailer reportedly encouraged customers to sign up for the program with promises of discounted pricing. However, members were required to log in monthly to avoid a recurring charge of $49.95. The lawsuit claims that TFG misrepresented pricing on its website and automatically enrolled customers without their consent, complicating the cancellation process.
According to the Office of the North Carolina Attorney General, the settlement will result in $197,552 in restitution for consumers in the state. Notably, 87 customers will receive automatic refunds, while others seeking refunds must file a complaint with the North Carolina Department of Justice by January 30, 2026.
Requirements for Future Compliance
The settlement includes provisions that require TFG to enhance its practices regarding customer consent and transparency. TFG must ensure that customers are fully aware of the terms associated with the VIP program, cease billing recurring charges without consent, and simplify the cancellation process for members.
Jackson emphasized the positive impact of the settlement, stating, “The money we won back will help refund customers who were misled by these companies. If you had a bad experience with any of these brands, please file a complaint with our office.” This resolution not only aims to reimburse affected consumers but also seeks to enforce better business practices within TFG and similar retailers.
As the landscape of online retail continues to evolve, this settlement serves as a reminder of the importance of transparency and consumer rights in e-commerce.
