SEATTLE (AP) — The Washington state attorney general has filed a lawsuit against the California-based clothing company LuLaRoe contending the business is a pyramid scheme.
Attorney General Bob Ferguson announced the lawsuit in a prepared statement released Friday, saying thousands of Washington residents have lost money selling clothes for LuLaRoe.
In an email, a LuLaRoe spokesperson said the claims in lawsuit are completely without merit and the company will fight vigorously against them. The spokesperson said the company remains enthusiastic about the strength of the brand and strong consumer demand.
Ferguson says the company tricked consumers into signing up to sell the LuLaRoe products with deceptive claims of high profits and refunds for unsold merchandise. Ferguson says the company misrepresented refund policies in violation of the state Consumer Protection Act.
He says more than 3,500 Washington residents have become “Independent Fashion Consultants” for LuLaRoe since the start of 2014.