I like Theory as much as the next guy, but I never understand their pricing or marketing strategy. They advertise themselves as a "contemporary" brand that makes basic, staple parts of the wardrobe in stretch fabrics. But, "basics" means just that; their items usually aren't terribly distinctive and yet they charge a lot for them (made in China shirts for $235 or more, pants $250 and up, etc.) As well, I don't really know who buys their stuff or who their target consumer actually is. I've got several friends who work for boutiques that stock (or once stocked) Theory and they said that nobody paid retail for it and tons of it were always on the sales rack.
I think that they shoot for the market of people who like Prada, Jil Sander, Lang, etc. but maybe just don't want to pay as much. Nevertheless, they still charge enough for their items that for an extra $40, you could actually GET the Prada or Lang shirt (button-fronts are usually in the $275- $295 area). So, in short, why buy Theory when you can get the brand they copy? And, of those I know who have bought Theory shirts (always on sale), they did so BECAUSE the shirt was the closest thing in styling to Lang, Prada, or Sander.
Nevertheless the styling isn't bad and the quality is okay. So, all in all, $500 isn't bad for a leather jacket, especially if it looks really good on you. Nevertheless, it definitely isn't a stellar deal. If it were me, I'd wait and hope it went down to under $300.
Also, it is the sort of jacket that, if you pay $500, you will never be able to resell on ebay and get your money back. If you like it, go for it, but it may be something you are stuck with forever. (Contrast to Dolce&Gabbana, on the other hand. I got a leather jacket on sale a long time ago for about $400, wore it for a few years, then put it on ebay and it ended up selling for $450).