Amazon Class Action Alleges Massive Price Increases

Two Amazon customers have launched a price gouging class action lawsuit against the online retailer alleging that the company is taking advantage of consumers during the pandemic.

The COVID-19 Amazon class action lawsuit was filed by two California residents — Victoria Ballinger and Mary McQueen. Both women say that they purchased items from Amazon after a state of emergency was declared in California due to the coronavirus outbreak.

They state that, because of the crisis, their best option was to obtain the items from Amazon as opposed to going to a brick and mortar store in-person and risking exposure to the virus.

However, they say that they were met with prices well above the normal level for essential household goods. Ballinger says that she purchased a Mary Kay Time Wise 3-in-1 Facial Cleanser from Amazon which was normally sold for around $9.60. Ballinger says that, due to Amazon’s price gouging, she paid $14.47 – 51 percent higher than its usual price.

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In McQueen’s case, she also says she paid an exorbitant price for a personal care product. Allegedly, she paid $6.74 for a Sally Hanson Hair Remover Kit normally priced at $4.75. 

The customers explain that during the current pandemic, there has been a scarcity of essential goods, as the public attempts to stock up for business closures, travel restrictions, and quarantine. Additionally, other safety items are increasing in demand because of the nature of the pandemic, including hand sanitizer and personal protective equipment. 

Amazon’s power in the current marketplace has allegedly only increased as stay-at-home orders around the country force people to remain in their homes, according to the plaintiffs.

For some people particularly at risk for the virus, or for those who already have COVID-19, they are not able to leave home at all and must rely solely on online retailers.

Allegedly, as an online seller, Amazon has taken advantage of the scarcity of products in brick and mortar stores, as well as some consumers’ inability to leave their homes.

As customers turn to online retailers to make up the difference of what is available, Amazon has made a profit, says the price gouging class action lawsuit.

The two plaintiffs say that Amazon took advantage of their lack of options in the coronavirus pandemic, as well as the lack of options of many other consumers, to charge unlawfully high prices. 

According to McQueen and Ballinger, instead of making the products available at fair prices to customers during a time of need, Amazon has decided to use the pandemic to its advantage by hiking prices beyond a reasonable range. The Amazon prices class action lawsuit says that in the case of some items, Amazon has raise prices more than 1,000 percent. 

Some of the items that have seen a raise in prices include face masks, pain reliever, cold remedies, black beans, flour and disinfectant, say the customers. These items have allegedly seen a wide range of price increases. The customers provide a particularly striking example in the price hike for cold remedies, up 674 percent from $4.65 to $35.99.

All of the items listed above and many more are experiencing price hikes well above what is allowed by California law. McQueen and Ballinger explain that California law prohibits price hikes of more than 10 percent in a national emergency.

The Amazon price increase class action lawsuit explains that California’s Unfair Competition Law prohibits overcharging consumers for essential goods during emergency conditions. According to the customers, this practice is unlawful and “contrary to basic human decency.”

Elaborating on how these price hikes are implemented, McQueen and Ballinger say that Amazon is, in many cases, a third-party seller of items, though the retailer also sells items directly. According to the customers, both kinds of items have seen extraordinary price hikes.

In the case of items offer by third-parties, Amazon allegedly controls the sale of the item and profits wildly from doing so. To add insult to injury, Amazon reportedly advertises that it helps stop price gouging by third-party suppliers, while in the eyes of the customers, is a major offender itself. 

The current Amazon price gouging class action lawsuit was preceded by one filed just last month, making similar claims against the online retailer.

McQueen and Ballinger are represented by Ben Harrington, Benjamin Siegel, and Steve W. Berman of Hagens Berman Sobol Shapiro LLP.

The Amazon Price Gouging Class Action Lawsuit is Mary McQueen, et al. v. Amazon Inc., Case No. 4:20-cv-02782, in the U.S. District Court for the Northern District of California.

UPDATE: On June 22, 2020, Amazon told a California federal judge that consumers must be required to arbitrate their price gouging class action lawsuit claims individually.

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