By Dave Simpson

Law360 (June 5, 2020, 9:13 PM EDT ) Reese Witherspoon promised free dresses to teachers who signed up with her clothing company, but after nearly a million handed over their personal information, the movie star offered only a 250-dress lottery, teachers said in a putative breach of contract class action removed to California federal court Thursday.

Witherspoon and her company, Draper James LLC, used the teachers' sensitive personal information for commercial purposes and also reaped loads of unearned publicity from the "scam," the teachers said in the suit filed in California state court in April.

"Defendants failed to disclose the material fact they only intended to provide goods for 250 people — which with the average retail cost of their least expensive goods, was an estimated paltry $12,500 in actual cost to defendants, at a time when other individuals of Ms. Witherspoon's renown were offering millions of dollars to COVID-19 victims," the teachers said.

The teachers were asked to provide their work email addresses, teacher IDs, and copies of their work badges, among other things, without any indication that the data would be exploited by the company, the suit alleges.

Nothing about the free dress offer indicated that it was a part of a lottery and the offer's one parenthetical notation — "offer valid while supplies last — winners will be notified on Tuesday, April 7th" — was insufficient to place a reasonable customer on notice that it was a lottery, the teachers said.

Despite intending to give out only 250 dresses, the company went on national television shows promoting the offer, the suit says.

"It is highly unlikely that national shows such as `The Today Show' and `Good Morning America' would have stated 'Reese Witherspoon's clothing brand is giving away free dresses to teachers' or 'Reese Witherspoon's label Draper James is giving free dresses to teachers' or 'the Oscar-winning actress wants to show her gratitude during the coronavirus pandemic' if they were aware Defendants were in fact only offering educators nationwide a pittance," teachers said.

After getting almost a million sign-ups, the company "suddenly renounced" the offer, instead running its dress lottery, the suit said. The company saved hundreds of thousands of dollars, if not millions, on marketing by not having to pay for the teachers' personal information. Since signing up, the teachers have been "bombarded" with promotional emails from Witherspoon's company, the suit says.

"Based on the response to defendants' offer and the significant reaction of tens of thousands of class members when the true facts were disclosed, a reasonable consumer would attach importance to defendants' claims," the suit says. "Based on the importance of such claims, these misrepresented and omitted facts would be and are presumptively material to a reasonable consumer."

In an attempt to remedy the negative response, the company said it was making a "'donation' of an unstated amount to charity instead of actually following through with their represented promises," the suit says.

In a statement to Law360 on Saturday, Draper James' attorney Theane Evangelis of Gibson Dunn and Crutcher LLP called the suit "an unjust attempt to exploit Draper James' good intentions to honor the teacher community by gifting hundreds of free dresses."

"The fact that supplies were limited, such that a free dress could not be provided to every teacher who responded, was disclosed and is no basis for a lawsuit," Evangelis continued. "Draper James looks forward to defending this case, to continuing its efforts to acknowledge the extraordinary contributions made by teachers during this time of need, and to being vindicated in court."

Counsel information for the plaintiffs could not be clarified Friday.

Draper James is represented by Theane Evangelis of Gibson Dunn and Crutcher LLP.

The case is Galvez et al v. Draper James, LLC et al, case number 2:20-cv-04976, in the U.S. District Court for the Central District of California.

--Editing by Peter Rozovsky.

Update: The story has been updated with comment from Draper James' counsel.

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