Amazon Adjusts Prices After Sales Error

An anonymous reader writes "On December 23, Amazon advertised a 'buy one get one free' sale on DVD box-sets, but apparently did not test the promotion before going live. When anyone placed two box-sets in their cart, the website gave a double discount — so the 'grand total' shown (before order submission) was $0.00 or some very small amount. Despite terms stating that Amazon checks order prices before shipping, Amazon shipped a large number of these orders. Five days later (December 28), after orders had been received and presumably opened, Amazon emailed customers advising them to return the box-sets unopened or their credit cards would be charged an additional amount (more threads). Starting yesterday, Amazon has been (re)charging credit cards, often without authorization. On Amazon's side, they didn't advertise any double discount, and the free or nearly-free box-sets must have cost them a mint. But with Amazon continually giving unadvertised discounts that seem to be errors, is 'return the merchandise or be charged' the new way that price glitches will be handled?"

Comments

The wise customer

[ktappe]

(Morality aside,) Wise customers either cancelled their credit cards or placed blocks on Amazon being able to charge them.

Re:The wise customer

[hack slash]

Amazon are comitting fraud if they don't have permission to take the money. Morally the people should pay but legally they don't have to. Anyone remember the Dixons £100 Kodak cameras some years ago? At least one person bought a whole bunch of them in the hope Dixons would cough up, they did and the person(s) sold the cameras on eBay and used the money to buy a top-notch camera. It seems companies aren't being so nice anymore when it comes to cock-ups they themselves make.

Re:The wise customer

[geekoid]

MOrality?
A price was agreed upon by both parties. If anyone is not being moral it's the person at Amazon who has decided to change the terms of the deal after the transaction has been completed.

The fact that the business failed because it was automated is a fault in theer business practice. It is not the fault of the customers. The customer can NOT know what the business has done or what deals the business has made, or what special promotions the business is running, or a myriad of other things.

If you got a notice right now saying you were undercharged 10,000 dollars for your car, would you pay?

Re:The wise customer

[MindStalker]

Well when you click on a product on a website you are not agreeing to buy. The only point in which you agree to buy is AFTER you have entered your CC number and you see a final total and you hit the submit/I agree/whatever button.

Can this possibly be legal?

[Apocalypse111]

Ok, let me get this straight. Your online service, which you claim to test rigorously, fails to charge me. We (myself and your system) agree on a price for these goods ($0.00), you charge me for it, send me my merchandise, and now you're trying to make me give it back or pay more for it? IANAL but the legality of this seems rather dubious.

Re:Sale has already been completed

[RattFink]

First of all you cannot be a party to a contract when you are under the influence period. That is why car sales need a notary to verify the sale.

This in particular is a clear case of Unjust Enrichment.

Don't use your "real" credit card.

[$pearhead]

This is one of the reasons I like the e-card service my bank provides. It allows you to create a virtual one-time credit card with a specified amount of money for on-line shopping. This makes sure you don't get charged for more than you specify (among other things).

will refuse the charge

[Gr8Apes]

All the consumer has to do is refuse the charge. Once charged, billed and shipped, the transaction is done.

Amazon committing a charge after the transaction has completed should be considered fraud and treated as such.

Re:will refuse the charge

[Ecuador]

Amazon is the one big corporation I have found that cares about its customers. Many times they have swallowed return shipping for heavy items way after their 30 day limit (just by asking them politely), and they routinely adjust your charge if they lower their prices (send email) etc.

So, let's get back to the issue. People saw on various threads on the net "Amazon Price Mistake!" logged on to Amazon and started ordering away, hoping their orders will get through. Probably the ebayers were the fist to take advantage of this. Now it was obvious to them that it was an error in the final cost calculation, as the promo rules were clear. There were even threads about the ethics of this on the various fora such as DVD Talk.

Amazon does send many of these orders (my guess is many thousands) and when they realize it they apologise and they ask to pay return shipping to get them back or to charge the right amount. Then people start acusing Amazon.

Wow. Just wow. I think because the general rule is to hate big corporations, we applaud people who try to steal from them? Yes, I would consider it stealing if you try to take advantage of a price mistake (especially if you do it to make money off ebay) AND you complain when the merchant wants to correct it. Yes, if the big corporation does not loose a lot of money, they will not bother you about it (consider it something like advertisment costs) and you would be fine with your conscience. But the fact that Amazon (with the amazing IMHO CS record) asks this, it meens that way too many people took advantage of this (I would bet most not for personal use) that they have to cut back their losses.

Now, IANAL, but I have read many times on slashdot about cases such as the one with the animal (I forgot, was it cow or horse or sth?) that was cheap for meat but was not sterile after all so the court annuled the low price contract. In the animal case the buyer did not even know more than the seller - it was just luck - while with the Amazon situation the buyers were aware of the mistake on the seller part, something which makes the case simpler to me.

Re:will refuse the charge

[rhakka]

I'm sorry, that's total BS.

If I charge my client a price for an item or service, and they stand up to their end of our bargin, I must stand up for my end... period.

If I accidentally give them a quote with no shipping costs on it, for example... well, I eat shipping on that order.

If I quote them a price on a special order item, then go to order it and realize the price I had was old, well, that's my fault too, not my customers. We made a deal, and they lived up to their end of it.

Going back after the fact to revise the terms of your deal is not only fraudulent, but opens the door to huge amount of intentional fraud. A contract would have no legitamacy at all... "whups, sorry, I messed up, let's rewrite the deal".

I'm sorry, if you cannot be bothered to keep your own systems in order, you pay the price of failure. Amazon has no right and should have no expectation whatsoever that a single one of those customers would or should return what they purchased, fairly, for a price Amazon told them was good. Period.

Re:Fraud protection anyone?

[julesh]

Not that I think they really did, but is it even legal for them to pull this bait and switch?

No. You can't ask somebody to pay one price for something and then charge them something else, even if you've previously told them the terms will be what you later change them back to be. This is called the "last shot" rule: the last exchange between vendor and purchaser determines what's in a contract: if it contradicts anything agreed previously, then the previous agreement is cancelled.

They can't charge your card without your authorization, right? RIGHT?!

Right. So you talk to your bank and ask them to charge it back. The bank will ask a few question and do so, the money appearing back in your account after ~7 days in my experience. At the other end, Amazon will receive a number of charges from their bank for the privelege of dealing with the mess. Serves 'em right.

Re:Sale has already been completed

[cryfreedomlove]

Have you ever looked at your check in a restaurant and noticed that the waiter forgot to charge you for something your ordered and ate? What do you do? I tell the waiter so they can add it to the check. Then I pay for what I ate. All of it. It's the right thing to do and that's the kind of society I want my kids to inherit.

In your world, there is no honor system. You'd sneer and leave the resaurant without paying what you owe. You'd pat yourself on the back while the restaurant owner struggles to pay his workers and keep the doors open.

In my example, there is a moral choice on the table. I made it one wa and you made it the other way. Who is the better man?

Re:Many similar cases exist

[$pearhead]

In Soviet Russia, you have to pay even if nothing has been sent to you.

Re:Sale has already been completed

[jlarocco]

This in particular is a clear case of Unjust Enrichment.

I don't think it is. Unjust Enrichment would be if the customer agreed to pay $50, but Amazon only charged them $5. Then the customer would be obligated to pay the remaining $45 because both parties agreed on the price of $50.

In this case however, Amazon meant to charge $50, but only charged the customers $0.01. The customers didn't agree to $50, they agreed to $0.01. Since, at the time, both parties agreed to the price of $0.01, it doesn't matter if Amazon changes their mind after the fact, the deal's done.

Amazon's pissed they lost a lot of money, but they're not allowed to retroactively charge people extra. I think their only option is to treat it as a sunk cost and make sure it doesn't happen again.

Say this were brick-and mortar

[spun]

You go in to a big-box store. You see a special two-for one advertised and buy the products. When you get to the register the clerk mis-rings it, punching in the wrong amount. Do you A.) Politely notify the clerk of their mistake and pay the difference, or B.) Walk out knowing you just got away with not paying what you expected to.

I know what I'd do. Even though I hate big, faceless corporations, I'd pay. I wouldn't even think about it. That's just the way I was raised, I guess. Would I do the same thing on Amazon? I'd like to say yes, because I think the morality is pretty clear, but I'm actually unsure of what I would have done in this situation. The real difference is looking somone in the face and knowing, "hey, this person will probably get shit if I do this and their boss finds out." Without that immediate, person to person contact, the urge to put one over on a big corporation when no one will get hurt is pretty tempting.

It's UCC, not FTC

[unassimilatible]

The UCC is controlling, and it places a duty of good faith and fair dealing on every sales of goods contract (both consumer and merchant). I think it is is a losing argument for a customer claim he thought that Amazon meant to give him two DVDs for free. You know it's a mistake, so you aren't being fair and honest. BTW, a breach of the duty of good faith can carry punitive damages. Plus, I'd guess that Amazon has a policy on this in the contract you agree to when you sign up with them.

I am a lawyer but not your lawyer. Do not rely on this, as it is not legal advice, but merely another /. poster pretending to be an expert on something.