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Ulta Beauty facing lawsuits alleging used products were resold

Ulta Beauty Inc. has been hit with two class-action lawsuits accusing the U.S.-based retailer of reselling used cosmetics products, and is facing additional probes by law firms.

On Feb. 27, law firms including Bragar Eagel & Squire PC, Pomerantz LLP and Johnson Fistel LLP said they were conducting investigations on behalf of Ulta investors concerning possible violations of federal securities laws, following media reports of a class-action lawsuit being filed against the Illinois-based company.

That lawsuit, which was filed in January in U.S. District Court in Illinois, accuses Ulta of "misrepresenting used cosmetics returned to its retail locations as new, and reselling these used products to unsuspecting consumers." It also called the alleged practices "deceptive, unfair and unsanitary."

Kimberley Laura Smith-Brown of California filed the federal suit following allegations posted on Twitter in early January by a person claiming to be a former Ulta store employee. The suit said that after the series of tweets describing the alleged practice of repackaging and reshelving returned products, "dozens of other current and former Ulta employees from retail locations all over the country confirmed that substantially similar practices also occurred at the Ulta stores where they worked."

A second class-action lawsuit was filed in early February in an Illinois circuit court by Meghan DeVries, also of Illinois. According to this latest complaint, Ulta employees are required to ask customers making returns if they used the product, with used products getting placed into a "damage bin."

However, the suit alleges that Ulta store managers have a quota for how many returned items can be deemed "damaged," a policy that results in employees routinely restocking used beauty products and selling them as new, potentially exposing customers to harmful bacteria.

Ulta has responded to the allegations through a video posted on its website, in which chief store officer Kecia Steelman says: "Ulta Beauty's policy does not permit the resale of used, damaged, or expired products. ... We take protecting the integrity of the products we sell very seriously."