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07/06/2021

Lawsuit accuses Amazon of price gouging during COVID pandemic

U.S. law firm says the e-giant engaged "in ‘unconscionable’ and unlawful price increases" on essential items

Amazon is facing a new class action lawsuit in the United States, accused of price gouging during the COVID pandemic.

The law firm of Hagens Berman initiated a class action last April on behalf of California consumers and has now expanded it to possibly include all Amazon shoppers across the U.S. who bought a number of affected items. The expanded lawsuit accuses Amazon of “engaging in ‘unconscionable’ and unlawful price increases during the COVID-19 pandemic, inflating prices for essential goods by upwards of 1,800 percent.”

Hagens Berman alleges, for example that after the U.S. federal government declared a public health emergency, prices for some products on Amazon skyrocketed including (in U.S. currency):

•Face Masks: from $4.21 to $79.99;

•Cold Remedies: from $4.65 to $79;

•Toilet Paper: from $17.48 to $200;

•Black Beans: from $3.54 to $21.99;

•Flour: from $22 to $110; and

•Disinfectant Wipes: from $20.71 to $174.96.

“Attempting to profit from a deadly pandemic is far from a victimless act,” said Steve Berman, managing partner of Seattle-based Hagens Berman, in a release. “When Amazon chose to hike up prices of emergency supplies and other goods while the world was reeling from COVID-19, it unlawfully price-gouged vulnerable consumers who were relying on Amazon to obtain goods safely.”

Amazon has faced other complaints over price gouging in the last year. Early in the pandemic, it came under fire after high-profile stories emerged of third-party sellers charging massively inflated prices for in-demand products like disinfectant wipes.

In an article posted to its AboutAmazon.com site under the headline “Price gouging has no place in our stores,” the company pointed out that more than half of the products sold on Amazon are offered by third-party sellers.

“The overwhelming majority are honest sellers who offer Amazon customers a wide array of great products at competitive prices,” it said. “Amazon strictly prohibits sellers from exploiting an emergency by charging excessively high prices on products and shipping.”

On other occasions, Amazon has strongly denied accusations it was overcharging for some of its own products.

"There is no place for price gouging on Amazon and that includes products offered directly by Amazon," the company told the CBC late last summer. "Our systems are designed to offer customers the best available online price and if we see an error, we work quickly to fix it."

But Hagens Berman said it planned to “hold Amazon accountable” for the examples of price gouging it found on Amazon.com.

“Amazon’s sales have never been higher, and since the COVID-19 pandemic began, its sales in some categories (e.g., home items) are up more than 1,000 percent,” says the lawsuit. “Meanwhile, Jeff Bezos’s personal wealth increased by $75 billion (or approximately $205 million per day) in 2020, during which hundreds of thousands of Americans lost their source of income and their lives to COVID-19.”