in 2001, the district attorney for napa county, california filed a lawsuit alleging that kb toys misrepresented sale prices and that it sold returned items as new. the case was settled in august 2003 for $1.2 million. in 2003, a class action lawsuit was filed in chicago against kb toys, alleging that the company's stores engaged in using deceptive price tags to manipulate consumers into believing that they were buying products at a discounted price. the lawsuit was settled with kb toys providing a one-week 30 percent discount on purchases of $30 or more.