Cavalleri v. Hermés and Illegal Tying

Abstract

This paper offers a joint economic and legal analysis of the California class action lawsuit, Cavalleri v. Hermès International (2025). In this case, plaintiff Tina Cavalleri alleges that luxury retailer Hermès International uses tying practices, illegal under US law, to coerce consumers to purchase unwanted accessory products (tied product), to access its iconic Birkin handbag (tying product). This paper utilizes a mixed-methods analysis to prove that Hermès’ tying practices are legal and reflective of consumers’ exclusivity preferences. Qualitatively, this paper considers the allegations within the context of economist Thorstein Veblen’s Theory of Conspicuous Consumption, which suggests that consumers purchase luxury goods both as costly signals of wealth or social status and as a means of emulating the consumption patterns of “social elites.” Quantitatively, this paper uses a cost-based modeling of bundling and tying, based on a model developed by economists David Evans and Michael Salinger, the support the notion that Hermès’s tying practices are both profit-maximizing and driven by transactional efficiencies, rather than anticompetitive foreclosure. Finally, the paper applies both Veblen’s theory and the cost-based findings to prior legal precedent for assessing tying practices per se. It finds that Cavalleri v. Hermès International (2025) fails the three-part test for per se tying. Recent legal precedent, such as Broad. Music v. Columbia Broad (1979), Ohio v. American Express (2018), and Brantley v. NBC Universal (2012) also suggests that legal tying practices can promote competition, a small group of ties are illegal per se, and judicial disapproval of tying arrangements has diminished over time. Therefore, under theoretical, economic, and legal analyses, the paper concludes that Hermès’ tying practices are not illegal per se, but rather reflect consumers’ preferences for exclusivity.