Amazon is being sued over accusations it “exploited consumers” during the pandemic by hiking up the prices of essential goods like face masks and hand sanitiser.
A class-action lawsuit has been filed in California against Amazon and could potentially include every US citizen who made a purchase with the ecommerce giant during that period.
The lawsuit, which was filed by law firm Hagens Berman, says that Amazon made “unlawful increases” to prices of key items including medical suppliers, tinned goods and other vital supplies in consumers’ “most vulnerable hour”.
It focuses specifically on the early months of the pandemic, when shoppers were faced with fresh stay-at-home orders so flocked online to stock up on essential goods safely.
According to the lawsuit, prices of face masks jumped 500 per cent from $20 to $120 on Amazon’s platform, while tinned goods like black beans jumped 672 per cent and other as much as 1000 per cent.
“Some of the unlawful increases were on sales of products supplied by third parties, sales which Amazon controls and reaps huge profits from,” the lawsuit says.
“Amazon is the functional seller of these products and is responsible when price-gouged sales violate the law. But in addition, Amazon has inflated prices on its own inventory of products, which Amazon supplies and sells directly to consumers.”
While price gouging is not strictly illegal across the US, many individual states have outlawed the practice during emergencies.
Amazon, alongside other online marketplaces like Ebay, have faced calls to stamp out price gouging from both governments and consumer groups since the start of the pandemic.
In March last year Amazon said it had removed over 4000 sellers for hiking up their prices on its platform, however the practice continued long afterwards on its marketplace.
Earlier this year, research published by the US Public Interest Research Group (PIRG) found that 409 out of 750 “essential” items had seen prices rise by an average of 20 per cent, but many items had seen far greater price hikes since March, including 136 items which doubled in cost.
In November, three third-party Amazon sellers were forced to pay fines of $52,000 and refund customers nearly $23,000 after being found to have sold thousands of units of hand sanitiser at “grossly” inflated prices.