A federal judge on Monday tentatively approved a $40 million settlement between Skechers USA Inc. and consumers who bought the toning shoes after ads made unfounded claims that the footwear would help people lose weight and strengthen muscles, according to the Associated Press.
An undetermined number of people will be able to get a maximum repayment for their purchases – up to $80 per pair of Shape-Ups; $84 per pair of Resistance Runner shoes; up to $54 per pair of Podded Sole Shoes; and $40 per pair for Tone-Ups.
The agreement comes three months after Skechers reached a deal with the Federal Trade Commission over the advertisements for the shoes. That settlement was related to a broader agreement that resolves a multi-state investigation led by the attorneys general from Tennessee and Ohio and involving more than 40 states. Skechers will provide an additional $5 million to the states.
The settlement covers more than 70 lawsuits from across the country. The suits were consolidated in federal court in Louisville, Ky.
Tim Blood, a San Diego-based attorney who represented the class, said the two settlements were reached in conjunction with each other.
“This is the other piece of the settlement process,” Blood told The Associated Press. “By combining the cases, we’re able to get much more value for class members.”
U.S. District Judge Thomas B. Russell set a fairness hearing to finalize the settlement for March 19. That hearing will be held after the settlement is advertised and consumers who qualify for compensation have an opportunity to object to the terms and opt out of participating, if they choose.
In May, Skechers USA, Inc. announced that it has settled all domestic legal proceedings relating to advertising claims made in connection with marketing its toning shoe products, including its Shape-ups line of shoes. The company has been involved in legal proceedings brought by the United States Federal Trade Commission, multiple states' Attorneys General and consumer class action lawyers, all investigating whether or alleging that the company made unsupported advertising claims in connection with marketing its toning shoes. The company will pay a one-time settlement of $45 million dollars plus $5 million in class action attorneys' fees to settle the domestic advertising matters and related claims on a global basis.
Skechers denied the allegations and believes its advertising was appropriate, but decided to settle these claims in order to avoid protracted legal proceedings. The one-time settlement is expected to result in substantial net savings for the company compared to the significant long-term cost of defending against multiple regulatory and civil legal proceedings in numerous jurisdictions. The company will not be paying any fines or penalties.
