90 Day Fiancé star Nicole Nafziger and Sister Wives star Meri Brown are both employees of the clothing company LuLaRoe, which has been accused of being an illegal pyramid scheme in the past. Now, RadarOnline.com can exclusively reveal the shady company has been hit with yet another lawsuit.
In court papers obtained from United States District Court for Alaska, Katie Van, on behalf of others, sued LuLaRoe in a class action lawsuit, claiming the company charged unlawful sales tax to customers.
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“From at least April 2016 through June 1, 2017, Defendants unlawfully charged a ‘sales tax’ to consumers in tax-free jurisdictions in Alaska on their purchases of clothing,” the amended complaint filed on September 13, 2018 read. “LuLaRoe knew its collection of taxes in these jurisdictions was unlawful, but concealed this fact from consumers, actively misleading them regarding the legality of its practice. This unlawful practice harmed Plaintiff and each class member in precisely the same manner.”
The plaintiffs call LuLaRoe’s sales tax “unlawful, unjust, deceptive and fraudulent.”
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“Beginning in 2014, LuLaRoe was being pressured by taxing authorities to remit tax on its retailers’ sales,” the complaint read. “As a result, it initiated a relationship with Utah-based POS vendor ControlPad to implement a POS system called ‘Audrey.’”
The court papers claim that before 2016, the Audrey system included a toggle-switch, which permitted LuLaRoe retailers to turn off tax charges when they made a sale in a tax-free jurisdiction.
Then in January 2016, LuLaRoe senior tax advisor undertook prior tax filings. Because of the way Audrey was programmed, LuLaRoe was paying sales tax on all sales regardless of whether or not the end consumer was charged or paid sales tax on a transaction.
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“LuLaRoe was overpaying sales tax because it was paying tax on the transactions shipped to class members,” the papers continued.
The 2016 Tax Policy was then designed to “wrongly shift the overpayments cause by the failures of LuLaRoe’s Audrey system from LuLaRoe to its end consumers.”
“LuLaRoe altered the Audrey POS to prevent retailers from turning off the sales tax feature when making sales delivered into other states with no sales tax,” the filing continued. …
Source:: Radar OnlineRadar Online