Holiday Sales, Post-Holiday Lawsuits: How to Shield Your Business from Consumer Class Actions

Consumer-facing businesses often face a noticeable increase in litigation and class actions following Black Friday and the broader holiday shopping season due to the high-volume transaction, aggressive promotions and the handling of sensitive consumer data during peak e-commerce periods.

Seasonal Spike in Specific Risk Areas

The good news is that this is more of a seasonal spike in specific risk areas, rather than a blanket “explosion” across business litigation. Reports from law firms and regulators highlight patterns in consumer protection claims, particularly around deceptive pricing, return policies and data breaches.

Four major factors contributed to the post-holiday increase in litigation risk.

• The volume effect.S. online sales hit $9.12 billion on Black Friday 2022, and by 2025, Adobe projected online sales to reach $11.7 billion, marking an estimated 8.3% to 8.7% year-over-year increase.
• Growing consumer awareness. Many consumers are bombarded by advertisements from plaintiffs’ law firms, directly gaining knowledge and insights in consumer rights, data protection and fraudulent business practices.
• Copycat litigation. In 2019, Equifax reached a settlement of up to $425 million for consumer restitution. The big settlement inspired waves of similar class actions and individual lawsuits.
• Regulatory scrutiny. Consumer protection laws are becoming more robust and consistently enforced. States governments have started taking the lead and expanding their role. New York and California, for instance, have created state regulations exceeding the federal standards.

Identify Each Specific Risk Area

Holiday deals tend to amplify vulnerabilities in three main areas:

• Deceptive Advertising and Pricing Claims. Black Friday hype often leads to class actions alleging false discounts or “illusory” sales. In September 2024, a class action lawsuit was filed against Amazon for allegedly posting fake limited time sale prices for its Fire TVs.
• Return Policy Disputes. ReturnPro estimated that holiday e-commerce return rates can reach up to 30%, with online deals being aggressively advertised and consumers flocking to digital platforms. Some consumers exploit return policies by returning used items or making fraudulent “empty box” claims, often around major shopping events like Black Friday.
• Consumer Data Breaches. Holiday e-commerce, projected by Adobe at $11.7 billion on 2025 Black Friday alone, means more payment information and personal identifiable information to be exchanged. The retail industry is a prime target for cybercriminals due to the vast amounts of customer payment card information and personal data it processes.

Practical Steps for Businesses to Take

Post-Black Friday litigation increase can hit businesses tremendously. Settlement costs are massive. The global average cost of a data breach is around $4.44 million in 2025. Nonetheless, by implementing pre-season pricing audits, clearly disclosed and consistently enforced return policies, and robust incident-response protocols with meaningful remediation offers, companies can substantially mitigate both the likelihood and the severity of post-holiday claims.

• Track Prices Aggressively. Section 233.1 of the Federal Trade Commission’s (FTC) Guides Against Deceptive Pricing requires that the former price on a comparison pricing advertisement be the “actual, bona fide price” offered to the public both “on a regular basis” and for a “reasonably substantial period of time”. To withstand the scrutiny under the strictest jurisdictions, retail merchants are recommended to substantiate every “original” or “compare at” price by demonstrating that the advertised higher price was actually offered to the public for a reasonable period immediately preceding the promotion.
• Create an Effective Return Policy. From a contract law standpoint, a well-written return policy functions as an express term of the sale agreement and, when properly presented and acknowledged, constitutes enforceable consent that significantly reduces exposure to consumer protection claims. The policy must be conspicuous, unambiguous, and incorporated into the contract of sale before payment is completed. The best practice requires presenting the full return terms in bold or highlighted text immediately prior to checkout, ideally via a mandatory scrollable text box that requires affirmative acknowledgement.
• Consistently Flag Serial Returners. Some merchants, such as REI, have enacted policies that would ban a small percentage of customers with extremely high return rates from making future returns or exchanges. Businesses can leverage AI tools in flagging serial returners. However, such policies may carry its own risks, which could lead to legal issues if policies are inconsistently enforced or found to be discriminatory based on protected characteristics.
• Implement a Standing-Resistant Data Breach Response Protocol. Since the Supreme Court’s decision in TransUnion LLC v. Ramirez, 594 U.S. 413 (2021), plaintiffs must demonstrate concrete and particularized injury to establish Article III standing in federal data-breach litigation. A rigorous incident-response plan can materially undermine such claims by eliminating or substantially reducing any ongoing concrete harm. Merchants should maintain a pre-approved protocol that mandates immediate notification, accompanied by multi-bureau credit monitoring and reimbursement for documented out-of-pocket losses. Such remedial measures, if promptly offered, can decrease the odds of establishing concrete and particularized injury.

Conclusion

As the holiday shopping season reaches its peak, consumer-facing businesses face a noticeable but predictable increase in litigation risk across deceptive advertising, return policy disputes and data breach class actions. Proactive risk management executed before Black Friday remains the most cost-effective protection against the costly waves of consumer litigation that typically follows the holiday sales.