[Ecommerce] Amazon wins small-claims fight over price mistakes

[Manon Anne Ress]

QUOTE:
She [District Judge Eileen Kato] also said the terms of a contract are 
applicable, whether a customer reads it or not.
END of QUOTE


http://seattletimes.nwsource.com/html/businesstechnology/134623713_amazon29.html

Amazon wins small-claims fight over price mistakes

By Monica Soto
Seattle Times technology reporter

Does online retail giant Amazon.com have to honor a sale price listed on 
its Web site, even if that price is a mistake?

That's the question customer Barry Sweet posed to a District Court judge 
yesterday in small-claims court in the first case of its kind for the 
Seattle-based retailer.

At issue: Sweet purchased an RCA 36-inch television on Amazon last 
August. The TV, originally priced at $1,049, was marked down roughly 90 
percent to $99.99.

After completing the order, Sweet said he received a confirmation e-mail 
and a shipping date. Two days later, Amazon notified Sweet that the 
price was a mistake and canceled the order.

Amazon later offered Sweet the item for the correct sale price: $849.99.

Amazon attorney David Zapolsky told the judge that the TV was part of a 
group of RCA products that customers could pre-order on the site. 
Roughly 6,000 customers ordered the TV at the incorrect price; all the 
orders were canceled.

Zapolsky said a unique aspect of conducting business on the Internet is 
that when the company makes a pricing error, that news passes quickly 
through cyberspace to buyers "trying to purchase it in hopes of a 
windfall," he said.

Zapolsky said if Amazon was forced to honor every incorrect price on its 
Web site, it could not stay in business.

Amazon's pricing policy holds that if an item's correct price is higher 
than its stated price, the company, at its discretion, will either 
contact the customer for instructions before shipping the item or cancel 
the order and notify the customer of the cancellation.

Zapolsky said a customer's credit card is not charged until the item 
enters the shipping process. Sweet's credit card was not charged in this 
instance, he said.

District Judge Eileen Kato said the case reminded her of one she studied 
many years ago in law school: whether a Chicago store had to honor an 
advertisement that incorrectly listed fur coats for sale at $1 apiece.

The lesson she gleaned from the former case: "If it's too good to be 
true, it's too good to be true."

Kato said the contract was not complete because Sweet's credit card had 
not been charged. She also said the terms of a contract are applicable, 
whether a customer reads it or not.

Sweet said he figured he might lose in court but wanted to bring up the 
point anyway. He said he bought his Christmas presents on Amazon and 
plans to continue shopping there.

His take: Beware a good sale. "I guess it means just because you're 
buying something on the Internet, it doesn't mean you're going to get 
it," he said.

Monica Soto: 206-515-5632 or msoto@seattletimes.com.




-- 
Manon Anne Ress
Consumer Project on Technology
www.cptech.org
PO Box 19367, Washington, DC 20036
manon.ress@cptech.org, voice: 1.202.387.8030, fax: 1.202.234.5176