Amazon Erases Orders To Cover Up Pricing Mistake

The Knife writes "Amazon secretly canceled orders for a large jazz CD set after realizing that it had mis-priced the item at $31 instead of its MSRP of $499. At first, inventory shortages caused the online merchant to string customers along for over a month after they placed their orders. But when Amazon realized that the box set was under-priced by $470, it simply erased all records of customers' order in their account history. No emails were sent to customers informing them of the price change or of the order cancellation. Probably because it violates Amazon's highly publicized price guarantee policy. A customer who called to complain and request the CD set at the $31 price was given a $20 discount off of his next Amazon order." A caveat: there is no external confirmation that Amazon did what is claimed here.

Comments

Bad Summary.

[adam]

Probably because it violates Amazon's highly publicized price guarantee policy

Gee, let's check amazon's price guarantee policy and see what it says at the bottom...

Despite our best efforts, a small number of the items in our catalog may be mispriced. If an item's correct price is higher than our stated price, we will, at our discretion, either contact you for instructions before shipping or cancel your order and notify you of such cancellation.

So, um, basically, their policy allows for them to cancel orders at their discretion. Which is approximately what it said in 2001, when I placed an order for 4 plasma TVs they had priced at $27/each. A few days later, they cancelled my order (along with the others of several others I know who were hoping for cheap TVs!). This has happened many times before with Amazon-- although by many I mean "several, that I am aware of," which is probably really good, considering the sheer volume of sales Amazon does. So, basically, nothing to see here.. move along. The product was priced incorrectly, they didn't charge anyone, they cancelled the orders. This is common practice for Amazon and other merchants.

Re:Bad Summary.

[Anonymous Coward]

Um, except depending on where you are they may, by law, be required to honor that price. As in California, it's illegal to sell something at a price higher than advertised...

Re:Bad Summary.

[Valdrax]

Your points are all really irrelevant to whether or not they performed the contract. Harm, for purposes of recovery, is the difference between the price listed and the next best price. Also, an industry standard practice of not living up to one's contracts is generally not held to be a legal excuse for not doing so if someone calls you on it.

Also, a contract of this sort is generally considered to be binding when the site gives you order confirmation, and you submit it. At that point, offer and acceptance has been had (even under the older UCC Article 2). The time at which they charge you or not is irrelevant in this situation.

The question essentially is, "Was there a breach of contract?" Since we've established that there was one, the question of whether deleting an order without sending you a message is a breach needs to be answered. Most likely (not knowing any further information about their ordering policies), it seems like there would be one under the notification rule the earlier poster made.

However, It's really a tempest in a teacup because no one is likely to sue them for it, and without a print-out of the order confirmation, there's no evidence the contract was ever made. Courts are unlikely to allow people to claim phantom orders on websites without any proof, and most states would make you go to small claims court for damages this small (which wouldn't allow you the discovery necessary to make Amazon.com cough up the proof that they did it). For a mere $350 bucks, most sane people wouldn't bother.

Re:Bad Summary.

[Anonymous Coward]

You must be a first year law student Valdrax. Mistake can be grounds to void a contract. Also, the UCC requires good faith, so buyers who knew or should have known the item was incorrectly priced never created a valid contract when they submitted their order.

Re:Bad Summary.

[1u3hr]

the question essentially is, "Was there a breach of contract?" Since we've established that there was one

Nothiing has been established. There is a pseudonymous post to Slashdot. No supporting documents. No screenshots. No names. Not a single detail that can be verified. This is not news, it's not even gossip.

Re:Bad Summary.

[zazzel]

I don't know US contract law, but in other parts of the world (Germany), courts have regularly ruled that an on-line order is not in itself a contract, but simply a demand for a contract that must be acknowledged by the other party (the dealer) in words or deeds to become a valid contract. So, delivery of the item, immediate billing, or an e-mail (not a simple "we received your order" e-mail) would make this a contract.

Re:Bad Summary.

[Ecuador]

No, YOU missed the point. The article is simple libel. I ordered the Jazz set at $30 (I saw it on the FatWallet forum), knowing that it would probably cancel, and sure enough I did get the cancellation email Saturday morning. Ok, it is unusual that the order does not appear in my order history, but it wasn't a "real" order anyway.
I hate it when idiots complain about such things when Amazon has the best retail policies - their price guarrantee and their free returns have saved me a lot of money and woe.
I remember a little over a year ago I had bought a home theater amplifier on sale. But since I was to move shortly I never opened it until I was settled at the new appartment, bought speakers etc... It turned out to be about 5 months later when I opened it and found out it had a small problem. Amazon takes care of returns during the first month, so I had to go through the manufacturer. The manufacturer asked me to ship the (heavy) item - on my own cost of course, it would then be evaluated and a replacement, if needed, would ship out in 2-3 weeks. I wrote to amazon and politely explained my predicament and whether they would be able to help me, and two days later I had a replacement amp on my doorstep (I have prime so shipping is always 2-days), and a prepaid UPS voucher to send back the original amp on my cost. I have many other examples of good customer service from Amazon, but I believe this was quite indicative.
The linked article was simply written by someone who is upset he didn't manage to get a freebie from a large retailer. This even happens to be the retailer with the best policies (which do state that price mistakes cannot be honored - duh!). Shame to the ./ editor for picking up this trash.

Re:Bad Summary.

[Caffeine_Coder]

Actually, I was one of the people who tried to get it, and I got a cancellation notice. Perhaps submitted should check their spam folder?


We regret to inform you that an error caused the following item(s) to
be displayed at an incorrect price:

Jazz in Paris

In accordance with our posted policies on pricing, we are unable to
offer this item for the incorrectly posted price. Therefore, we have
cancelled your order for this item.

At any given time, despite our best efforts, a small number of the
millions of items on our site may be mispriced. We do, however, verify
prices as part of our shipping procedures. If we discover that an
item's correct price is higher than our stated price, we will, at our
discretion, either contact you for instructions before shipping or
cancel your order and notify you of such cancellation. This policy is
posted in the Help section and is accessible through numerous other
areas of our web site.

We apologize for any inconvenience this may cause.

We value your business and hope that you will give us a chance to
serve you again in the future.

Sincerely,

Customer Service Department
Amazon.com

Please note: this e-mail was sent from a notification-only address
that cannot accept incoming e-mail. Please do not reply to this
message.

See the Google cache

[Anonymous Coward]

The pricing error seems to be borne out by a cached Google page. http://209.85.173.104/search?q=cache:MFzDQFSwSUkJ:www.amazon.com/Jazz-Paris-Various-Artists/dp/B00005RSB2+Jazz+in+Paris+%5BBOX+SET%5D+%5BIMPORT%5D+%5BLIMITED+EDITION%5D&hl=en&ct=clnk&cd=1&gl=us How they handle this error by honoring what they advertise or by using a clause somewhere in their legal text to disavow pricing errors remains to be seen.

completely legal

[Anonymous Coward]

i dont feel like burning karma, and someone with a law degree will chime up about the origins of "offer to treat" in the near future and clarify better than I could anyway, but basically until they charge your credit card, they don't have to honor the pricing. until they take your money, there is no contract between the two of you. even if the contract did at some point exist (i.e. they took your money and then failed to deliver on the product) and you sued them, they could probably argue bad faith on your part to nullify the contract (if it's a $500 item, and you bought it for $30, it would be very difficult to explain how you did so in 'good faith belief')

Amazon sucks, what's new?

[carndearg]

So what's new, Amazon has cr@p customer service. In other news, the Pope is Catholic and bears cr@p in the woods.
I used to buy a lot of stuff from Amazon UK. Then they changed couriers and the new courier had problems delivering to me. No problem I thought, I'll get on to their customer service line and fix it. Trouble is, there was no customer service line for Amazon UK, no customer service email address, just an online form that took you through several steps and then gave an error message. No problem I thought, it must be my minority browser/OS choice. Except it gave the same response on everything I could try it on at every site I tried it, including the obvious win/IE combo.
Amazon: great when everything goes right, cr@p when it doesn't. I've made my last ever Amazon order.

Re:External Confirmation?

[phillips321]

Well here's the proof from google cache: http://forumpix.co.uk/i.php?I=1202631583
And here's the corrected mistake afterwards: http://forumpix.co.uk/i.php?I=1202631639

Amazon's just fine here...

[ChePibe]

I'm a law student... just a student... NOT a lawyer, and certainly not your lawyer, so nothing here is legal advice, period. I am not qualified to give legal advice, so I'm not giving it and cannot, in fact, even do so. Speak to a qualified professional about these matters, NOT ME.

(This is all assuming, of course, that there is an actual problem here.)

If I'm remembering first year contracts properly, then there's no problem here with Amazon refusing to sell at the price it listed.

A contract must have a few things to come into existence, generally: offer, acceptance, consideration.

Advertisements and catalog listings suffer from an "over-subscription problem" and are not considered firm offers themselves and, therefore, cannot simply be "accepted" by a consumer who makes an order. Ads are generally treated as invitations to deal unless they require something special on top of just showing up (i.e. being the first in line). The consumer's order, however, is considered an offer, which can be rejected by the seller by either refusing to provide goods and refunding money in a timely fashion or refusing to accept the money in the first place. This is done to protect merchants from themselves (people shouldn't be able to walk away with huge windfalls because a $5.00/hr clerk forgot a zero) and to protect their advertisers from them (newspapers shouldn't be held accountable for giving people windfalls for much the same reason). It's just good public policy, and prevents the games of "gotcha".

I see why some people are whining, but from a legal standpoint (again, I am not providing legal advice and I'm only a student - I could be 100% wrong on this and would welcome correction), Amazon has done nothing wrong in simply deleting the orders and refunding any money already sent.

Re:External Confirmation?

[Anonymous Coward]

Do a cached Google search:

http://www.google.com/search?hl=en&q=site%3Aamazon.com+%22Jazz+in+Paris+%5BBOX+SET%5D+%5BIMPORT%5D+%5BLIMITED+EDITION%5D%22&btnG=Google+Search

The very first link reveals the original $30 pricing:

http://72.14.253.104/search?q=cache:MFzDQFSwSUkJ:www.amazon.com/Jazz-Paris-Various-Artists/dp/B00005RSB2+site:amazon.com+%22Jazz+in+Paris+%5BBOX+SET%5D+%5BIMPORT%5D+%5BLIMITED+EDITION%5D%22&hl=en&ct=clnk&cd=1&gl=us

Re:External Confirmation?

[pjotrb123]

Even though I think the submitter is totally whining for nothing, the Google cache claim by grandparent is accurate.

Google query: http://www.google.com/search?hl=en&q=site%3Awww.amazon.com+inurl%3AB00005RSB2+Jazz+import+box
Locate the URL that is in the summary and then click "Cached" right below it.

Please check your facts before posting.
And here's hoping that the Google cache doesn't update too soon or I'll get flamed ;-)

Re:Legality?

[philipgar]

Actually, from the link you gave us:

15. What if an item is marked the wrong price and the clerk catches it before I pay; am I entitled to buy the item at the price marked?

This is a fact-specific question best answered by a court. A store may not knowingly charge or attempt to charge a price higher than the price marked on the item. MCL 445.354. Therefore, the consumer may have a claim if the store will not sell the item at the price marked. However, the consumer may face obstacles convincing a court that the store knowingly charged the higher price when the pricing mistake is not intentional and will result in an obvious windfall to the consumer.

While this doesn't exactly say that the store can change the price, the law basically allows it, in particular when the pricing mistake was unintentional. In particular, this protects stores from swapping tags on items and try and call it the stores mistake. Consumers are not given a right to buy goods at a low price if the store makes a mistake and corrects it before the transaction has completed.

Phil

Re:Legality?

[jamesbulman]

This point from the website you mention would seem to apply to this case:

15. What if an item is marked the wrong price and the clerk catches it before I pay; am I entitled to buy the item at the price marked?

This is a fact-specific question best answered by a court. A store may not knowingly charge or attempt to charge a price higher than the price marked on the item. MCL 445.354. Therefore, the consumer may have a claim if the store will not sell the item at the price marked. However, the consumer may face obstacles convincing a court that the store knowingly charged the higher price when the pricing mistake is not intentional and will result in an obvious windfall to the consumer.

My personal take is that unless money has changed hands (in this case it hadn't) the store shouldn't be forced to honour an obvious mistake, especially as in this case the guy was acting in bad faith as he knew that the item was worth > 10x the listed price.

Re:Legality?

[rudy_wayne]

You're wrong. The store has to sell it for the price on the shelf. Most (all?) states have consumer protection laws in place where if the price differs at the register, you get the price on the shelf plus a bit extra (or if it is a small value item, it's free) For example... http://www.michigan.gov/ag/0,1607,7-164-34739_20942-134114--,00.html

Well, unfortunately, you didn't read the whole law. Here's the relevant portion from the Q&A section about the Michigan law (and I suspect that all states have a similar clause). Emphasis added is mine

What if an item is marked the wrong price and the clerk catches it before I pay; am I entitled to buy the item at the price marked?

This is a fact-specific question best answered by a court. A store may not knowingly charge or attempt to charge a price higher than the price marked on the item. MCL 445.354. Therefore, the consumer may have a claim if the store will not sell the item at the price marked. However, the consumer may face obstacles convincing a court that the store knowingly charged the higher price when the pricing mistake is not intentional and will result in an obvious windfall to the consumer.

Re:External Confirmation?

[freaker_TuC]

Check out Google Cache ?

The price has definitely been $31 according that cache; so the poster is not babbling out of his neck ...

Re:My own problems with Amazon

[cbart387]

Just a quick question. Did you buy it *from amazon* or *from a merchant*? If from a merchant, it's between the merchant and you at that point.

Please note: any situations that may arise after an order is submitted must be resolved directly with the seller. here

Cancellation email

[Ecuador]

Oh, and in case there is doubt about the cancellation email, this is what I got:

Greetings from Amazon.com.

We regret to inform you that an error caused the following item(s) to
be displayed at an incorrect price:

Jazz in Paris

In accordance with our posted policies on pricing, we are unable to
offer this item for the incorrectly posted price. Therefore, we have
cancelled your order for this item.

At any given time, despite our best efforts, a small number of the
millions of items on our site may be mispriced. We do, however, verify
prices as part of our shipping procedures. If we discover that an
item's correct price is higher than our stated price, we will, at our
discretion, either contact you for instructions before shipping or
cancel your order and notify you of such cancellation. This policy is
posted in the Help section and is accessible through numerous other
areas of our web site.

We apologize for any inconvenience this may cause.

We value your business and hope that you will give us a chance to
serve you again in the future.

Sincerely,

Customer Service Department
Amazon.com

Please note: this e-mail was sent from a notification-only address
that cannot accept incoming e-mail. Please do not reply to this
message.

It's still available

[jdc180]

If you want confirmation yourself, order it through target and wait. http://www.target.com/dp/B00005RSB2/sr=1-4/qid=1202528379/ref=sr_1_4/601-6766354-3567303?ie=UTF8&index=target&rh=k%3AJazz%20in%20Paris%20&page=1