Plaintiffs allege Amazon’s arbitration clause unconscionable

By: The VNN Team  //  Arbitration, Consumer News

by Carol Thompson

What started as a blender purchase has become a mishmash of allegations against Internet giant Amazon.

In court papers filed April 15, Andrea Fagerstrom and Allen Wiseley allege that Amazon should not be allowed to hold customers to its arbitration agreement that they claim can be altered at any time.

Amazon also fails to provide its customers with the opportunity to negotiate better terms of the arbitration agreement present at the point of sale, the class action lawsuit states.

The legal wrangle began when Fagerstrom brought a lawsuit against Amazon after she purchased a blender for $299 that claimed to have a list price of $329, however, the alleged 9 percent savings was “illusory and/or grandly overstated” because the genuine market price for the blender was $299, including at Target, the original lawsuit alleged.

Amazon customarily displays it products with a list price, followed by Amazon’s discounted price, and then the purported savings in both a dollar amount and percentage, Fagerstrom claimed.

Wiseley purchased an analog audio converter from the website for $21 in 2013. The lawsuit alleges the listed price was $59 and that this price was from 2010.

The suit was originally filed in San Diego Superior Court but was removed to U.S. District Court for the Southern District of California on Jan. 16.

In February, Amazon countered claiming that the plaintiffs agreed to an arbitration pact when they made their purchases on the website, therefore the class action lawsuit over list price discrepancies should be dismissed.

“In making these purchases, plaintiffs expressly accepted Amazon’s COUs (Conditions of Use) and the arbitration agreement within the COUs. The final “checkout” page in the ordering process on Amazon.com allows customers to review and confirm their orders by clicking a ‘Place your order’ button,” the online retailer states in its motion to dismiss. “

“If Plaintiffs did not want to accept the COUs or the arbitration agreement, they could have cancelled their purchases before accepting arbitration,” Amazon noted. “But both completed their purchases by clicking the ‘Place your order’ button. Indeed, neither could have done so without accepting the COUs and arbitration.”

Amazon has successfully cited its arbitration agreement in other class actions.

Arbitration agreements have come under close scrutiny since the U.S. Consumer Financial Protection Bureau issued a scathing report last month blasting the use of arbitration clauses in consumer contracts.

Image: Flickr/Soumit