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?"

Sale has already been completed

[A beautiful mind]

...and they sold it for the price they specified. The problem is their fault and why should a customer care or be responsible for the problem on Amazon's end?

If a guy sells his car while drunk for a small amount of money, or gambles it away while drunk, it's his fault entirely not the buyers.

Fraud protection anyone?

[st_judas]

It is for this reason that fraud protection exists. Visa and other major credit card providers will generally charge back the vendor in cases like this, as it is essentially fraud.

What proof do we have that this was an honest mistake? They could have done this intentionally. Not that I think they really did, but is it even legal for them to pull this bait and switch? They can't charge your card without your authorization, right? RIGHT?!

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:Welcome to the ME society.

[ktappe]

theft is theft no matter how you coach it in terms of a 'sale'

This is way out of line. The buyers of this item did not walk out of a store with the intent of not paying for goods. If you want to draw an accurate analogy to a brick & mortar, they took the goods to the cashier who then chose not to charge them and wished them a nice day. Trying to throw that back in the customer's face is disingenuous at best and libel at worst.

Re:Welcome to the ME society.

[neverutterwhen]

Amazon aren't the police. They can't raid your house in order to get their stuff back: that is also a felony. Yes, it is wrong for people to refuse to pay Amazon what is due them, a clerical error of this sort should not be taken advantage of. If a customer were to accidentally add a zero to a payment, there would be uproar if Amazon refused to refund it. However, that doesn't mean they can just start making unauthorised withdrawals from other people's bank accounts.

Re:Welcome to the ME society.

[bugg]

Jeff Bezos can afford to lose the amount of money lost in those few days personally, and not have to feel it. The hypothetical local ma and pop store cannot.

Why doesn't that matter to you? Corporations like Amazon have gotten very, very rich - and lots of local business have had to fold because of it.

Re:Welcome to the ME society.

[twiddlingbits]

There is such a thing as an "implied contract" when a Sale is made. The contract terms such as "All Sales Final" must be clearly stated, the price, any warranty, return periods, etc. Anything someone on EITHER side does to dishonor the terms is breach and possible fraud. I run a small business (actually it is the spouse business) and one time I sold an expensive item (jewely) for about 80% of what it should have sold for, it was a credit card sale so we COULD have ran a seperate charge for the difference. The honest thing to do (and legal) was to EAT the difference. Amazon should do the same. If they don't they just lost me as a customer. And hopefully those they tried to re-bill are no longer customers. Barnes & Noble dot com here I come! Your analog to the money at the bank is flawed, it's not at all the same thing. The product belongs to you as you honored your side of the contract. The money bag you knew clearly was the property of someone else which you had no rights either stated or implied to possess. That makes it theft.

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:Can this possibly be legal?

[Anonymous Coward]

The vicious irony is that it's all so asymmetric. I've never had the pleasure, but I imagine it doesn't get resolved quite as smoothly if Amazon accidentally charges you twice.

Re:Welcome to the ME society.

[Scutter]

When my company provides a quote for a job, we're expected to do the job at that price. If the job ends up costing more, or we mis-quoted for some reason, we can attempt to re-negotiate the contract, but the customer is under no legal obligation to do so. We certainly can't do it after the quote has been fulfilled and the job is complete. We have to eat the cost of our mistake. It's called "the price of doing business" and it's the reason why you want to make sure you hire competent people and not monkeys. How is this any different? Amazon screwed up a quote for a job. They signed a binding contract of sale with the customers, and then they want to renege on that contract.

Companies like Amazon cannot continue to claim "website error" for their bait-and-switch tactics any more than casinos should be allowed to claim "mechanical error" to get out of paying a jackpot.

Re:Can this possibly be legal?

[Vulva R. Thompson, P]

Strict legality aside, let's sit back, take a deep breath, and test out your comment in the physical world.

You walk into Best Buy, select your merchandise then take it to a checkout counter. The clerk charges you $0.00 and the receipt reflects that. You exit the store and on the way to your car the manager approaches you with the error.

Realistically, what's going to happen next?

Re:Not new at all...

[Aladrin]

BestBuy could have canceled the order for little or no reason at all. They -can- suddenly decide not to sell those products at that price and cancel the order.

Instead, they were VERY nice and gave $50 to each customer that they inconvenienced with this.

The customer was not 'responsible' for the mistake. The customers still had ample opportunity to cancel the order completely as it was still a pre-order and nothing had been shipped and very little time had passed.

Amazon did something completely different. They shipped a product to a person and THEN claimed the person owed them more money. Last I checked, it was illegal to ship something to someone for free and then charge them for it. It used to be a mail scam. (The difference there being that the customer didn't ask for it at all, though.) Amazon is clearly in the wrong every time they charge someone's card that didn't agree to it. BestBuy didn't do that.

Re:The wise customer

[StarvingSE]

While Amazon.com did make a mistake, the advertised price was buy one get one free. Even though the checkout stated $0.00, it can be argued that the customer agreed to pay for one of those boxed sets.

While many people have a problem with Amazon, I have had nothing but the best experiences dealing with them. Their customer service has been top notch the one time I have needed them, they ship fast, and they ship for free.

While it sucks that a mistake was made, I think these customers are being a bit greedy expecting to get "something for nothing." While Amazon represents the "big corporation" and people love to screw with big companies (and some probably deserve it), I think its morally wrong for people to expect to not have to pay for the merchandise received.

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.

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.

Re:Can this possibly be legal?

[Don_dumb]

Also consider the opposite -

You go into a store and purchase two DVDs, you go through the till and you pay full price for both DVDs, the reciept states as such. You then leave the store, go home, watch the DVDs and then notice that the same shop had a "2 for 1" discount on those two DVDs.
I would guess that when you return for the one DVD discount, they would reply that you can only query the charges before leaving the store, not after (just like the sign in the store says).

All of that seems fair, so why should the shop be allowed to 'correct' the agreed deal after everything has taken place, but the consumer is not allowed to 'correct' the deal.

Re:Sale has already been completed

[Hodar]

Honor has nothing to do with this. You go to a store, they make you a deal. Based upon the price, and how badly you want the object of your desire; you decide whether to pay or not. You do not get the option to barter, you pay, you get a receipt and you leave. Does the Grocery store have the option of saying "Hmmmm, we could have gotten 50 cents more for that gallon of milk", then have a right to take 50 cents off of your debit card? No. Why, because the price you paid is the condition of the sale, rebates, shipping and handling included. If Amazon realizes a mistake, they have until the product ships to determine the nature of their mistake and correct it. At that time, the buyer (who has not yet been charged) has the option to agree to the higher price, or decline the offer. To tell a customer "Take time off of work, re-package what we sold you, drive it to a postal center and ship it back to us; or we will charge you an arbitrary amount to your card - is extortion." Why? Because, "would you have purchased the goods if the full price were disclosed?"

The stupid company

[TWX]

While Amazon.com did make a mistake, the advertised price was buy one get one free. Even though the checkout stated $0.00, it can be argued that the customer agreed to pay for one of those boxed sets.

While it sucks that a mistake was made, I think these customers are being a bit greedy expecting to get "something for nothing." While Amazon represents the "big corporation" and people love to screw with big companies (and some probably deserve it), I think its morally wrong for people to expect to not have to pay for the merchandise received.

If Amazon has a fairly-involved checkout process (where one has to put in the credit card, view the subtotal and total charges, agree to them, and submit them), the Amazon is totally at fault if they don't have a human being on the other end of the transaction verifying that the prices are correct. The entire purpose of a receipt is that the seller acknowledges selling the item(s) for the price on the receipt, and the buyer agrees to pay for them. If the buyer doesn't have credit with the seller (note: NOT the credit card) then the seller is responsible to ensure that their books are kept accurate and are processed properly. If Amazon doesn't do that and doesn't test their system, the fault and responsibility are on them and the employee or employees who made the mistake, not on the buyer. Once the transaction is completed (and Amazon generating a receipt and shipping the product is the final act of completing it) then the buyer is no longer responsible.

If Amazon did this to me, I'd let the charge appear, and then call fraud with my credit card processor. I'd submit copies of my receipts. I'd probably also forward to the appropriate Attorneys General of the states involved.

Re:The wise customer

[encoderer]

"it can be argued that the customer agreed to pay for one of those boxed sets."

Well, it could be argued that Jeff Bezos was the second gunman on the grassy knoll but that doesn't mean it's actually true.

In reality, though, every shopping cart that I've ever used or developed has a step, after shipping and tax is calculated, where the user is asked to confirm their purchase and authorize the sale. A similar step occurs in offline-processing, where the full amount is shown on the screen and you are asked to confirm, by either swiping your card and entering your pin, or by signing the receipt.

THIS is the step where you agree to the price and accept the terms. You couldn't possible agree and confirm a price before this step because it wouldn't include shipping/taxes.

And while IANAL, I believe that at this step, Amazon is responsible for their own mistake. They showed the user a price. The user was given a chance to say confirm his order and authorize charges. He did so.

This is a contract, it's been digitally signed.

Amazon is trying to make it so their mistake costs them nothing. That's certainly a nice fuzzy warm thing to think about, but in the real world, there is a price to pay for mistakes.

Re:The wise customer

[cybermage]

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

Well, if I only paid $0.00 for it in the first place, I might expect to be asked to return the car or pay a fair price later.

I think the problem with Amazon's deal isn't really any different than walking into a store, taking something to the cashier, having the cashier just put it in a bag and leaving without paying. Even if the cashier says "just go ahead and take it", that doesn't make it right.

Taking advantage of a broken automated system isn't any more moral than stealing if you know the price isn't appropriate.

If an ATM gave you money and didn't deduct it from your account, would you tell the bank?

Re:Sale has already been completed

[MikeJ9919]

Nope, nice try. You would be right if it weren't for the fact that, as the original poster noted, they have a contract in which Amazon takes the risk for error upon itself. They stated they check prices before shipping. When two parties negotiate the risk of error between themselves and it is fixed on one party, courts will not likely disturb that. I have no doubt Amazon has received a material benefit in the form of consumer trust from the "we check prices first" promise. It would be unjust enrichment to allow them to renege. (Not really...it would actually just be breach of the contract by Amazon, but it's fun to turn around someone's attempted use of legal jargon.)

Re:The wise customer

[Zeinfeld]

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.

IANAL but this is certainly what a customer is likely to argue in court. The seller has the responsibility to make sure that the invoice total is correct. No excuses. It is very clear that the final 'accept' button is an offer of a contract.

Its a losing proposition for Amazon here. They are going to get crucified by chargebacks for the unauthorized purchases.

The mailings telling people to return the merchandise would appear to risk falling into the category of demanding payment for unsolicited goods. The customer agreed to pay for the goods but for the stated price.

Just fire the middle manager who you have bungling the remediation on this, eat the ten million or so and move on.

Re:Sale has already been completed

[nolife]

That is not the same thing.
Imagine asking the waiter how much the Roast duck and bottle costs, he states $9 and you order that and pay the bill when you leave, two weeks later receive a bill for $90 because the bill should have been $99. Would you have ordered it if would not have clearly stated $9?

With ordering online, the final price minus all discounts, shipping and taxes is posted on the final page that states click here to finalize your order. That is the point where you make an agreement and agree with the terms. Not the main page that claims "all merchandise is 50%" off, not the page that says, "add to cart", not the page that offers an extended warranty and accessories. Not the page that asks for your address and phone number. You do not purchase the product and enter into an agreement until that final page that states what will be charged to your card. Every single person that has ever shopped online has backed out at that last minute and hit cancel because they did not want to go through with it or did not agree to the final price. Everything that lead to that page with the final click is not relevant because you did not agree to anything before that.

Re:The wise customer

[Helios1182]

It would be more like if the cashier rang up the item, set the price to zero, and then gave you a receipt giving proof of a legitimate transaction. The fact that it didn't cost the customer anything doesn't change the fact that the store (or its representative) authorized the transaction.

Re:Sale has already been completed

[UncleTogie]

Maybe.....JUST maybe....

They realize this isn't how the world is, true... but they also realize it's where the world needs to be if humans want to survive as a species....

Re:Can this possibly be legal?

[cduffy]

If it's $0.00, I give the merchandise back -- if they took it to small claims, they'd win, because any reasonable person would know they were making a mistake, and without me giving them some amount of compensation there's no valid purchase contract.

If it's $5.00 for something that usually costs $30.00, and that merchant is known for having discounts they don't always publicize, I'd refuse -- I could have reasonably believed that the discount was intentional at the time of purchase, and all the elements necessary for a binding contract were met. Also, I don't like Best Buy much; Costco (for instance) I'd probably give some deference to because they've gone out of their way for me on occasion, and it would hurt if they decided to terminate our relationship.

So -- rather key here is the distinction between being charged $0.00, being charged some amount that is nonzero but which is small enough that a reasonable consumer would believe there to be an error, and being charged some amount where the consumer can reasonably believe that the sale at that price was intentional. In the first case, the consumer is clearly in the wrong. In the last case, the merchant is clearly in the wrong. In the middle ground... who knows?

Re:Sale has already been completed

[RattFink]

First of all they are 100% in the wrong for not going though the courts to collect. That is what they are there for and they have no right to just take the money.

That said, I think your assessment would be spot on if they were sold by a competent sales person at that amount. The problem I have with you wrote is that a piece of computer software really cannot be considered a agent of the company in itself, which seems to be implied. A piece of software in itself cannot negotiate a price, it can only do what it was programmed. Basically what happened is that due to a technical error a contract was made that both parties didn't agree to, which in most cases would render the contract void.

Re:Sale has already been completed

[Alchemar]

Law and Honor are two seperate entities. The law states that when two parties agree on a price and completed a transaction, the transaction if final. If Amazon wants to request that these people pay for the intended amount, they are free to do so. Charging someones account without their authorization in not the honorable or legal thing to do. A lot of people feel that they have been screwed over by a legal system that is drastically in favor of corporations. When they have a situation where for once the law is on their side, they will take it. Honor will only take a corportation so far in a world where corporations tell people that EULA that they didn't sign overrides their rights to fair use, where phone companies can send you a notice in your bill telling you that you have agreed to waive your constitutional right to a jury trial. If corporations want to play games with legal loop holes, they should not expect people to let them skirt around the legal system in order to force those people to do the honorable thing.

Re:The wise customer

[frdmfghtr]

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

Another scenario: you order the DVD box sets from Amazon but a few weeks later (after the return window), you realize that you got charged too much for the purchase. Amazon refuses to refund the overcharge. Is Amazon right or wrong? After all, at the end of the transaction, you agreed to a price for the delivered goods.

It works both ways; if you expect Amazon (or any business or individual) to correct an error after the transaction that works in your favor, then you don't have any room to complain when the entity tries to correct an error after the fact in their favor.

Well

[paranode]

I agree with your point in general, however Amazon had the opportunity to review the sale before shipping it. The fact that it failed to rectify the situation before shipping the goods to the consumer basically shifts the liability over to them. They have no right to go looking for money after they deliver the goods and the payment is settled.

Nothing good . . .

[Anonymous Coward]

The funny part (funny-depressing, not funny-haha) is that Amazon will be sued by a class-action lawyer to recover all the amounts illegally charged to customers after the fact. The lawyers will be a multi-million dollar check and the consumers will get coupons.

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:The wise customer

[TheDawgLives]

Let's think about this for a second... If you go to Wal*Mart, and buy a jar of pickles marked 2/$5 and get to the checkout, and they only charge you $0.50 because they had the wrong price in their system (which happens quite often), then Wal*Mart can't come to your house later and mug you to make up for it. Amazon should have verified the prices BEFORE shipping. If they had done their due diligence, then they would have canceled the order and e-mailed the customer. This is totally Amazon's fault and as many others have suggested, these customers should refuse the charges on their next statement.

Re:Sale has already been completed

[microTodd]

If you are honest and frank, people may cheat you;
Be honest and frank anyway.

---Mother Teresa

Re:The wise customer

[alx5000]

{You got charged too much} or {You agreed to pay the stated quantity on checkout}?
If just before clicking "Proceed with payment", the deal is $X, then you'll have to pay $X. This story is not on "what users were charged with", but on "what users agreed to pay on checkout".

Re:Welcome to the ME society.

[Kohath]

t isn't my fault. it is the cashier's fault

Right and wrong aren't about assigning blame.

Re:The wise customer

[wealthychef]

Here's another analogy. You go to WalMart and buy a sleeping bag and the clerk at the counter mistakenly rings you up for $5.00 instead of $50.00. Or he or she hands you $50 in change when the register says $5.00. You absolutely can leave the store with "your" extra money, but if you admitted in court that you knew it was a mistake, I'm sure the law would say you stole the money, and so would anyone else. So anyone who accepts the second DVD set knowingly under false pretenses has stolen it. And you cannot convincingly say you didn't know that Amazon was not giving away free DVD sets, come on, that's not an honest argument. Amazon has a right to get their money back, but they should ask a court to allow it.

Re:The wise customer

[Magic5Ball]

A receipt with a price of zero is strong evidence that there was no exchange of valuable consideration, which puts into question the legitimacy and enforcability of any contract that generated the transaction documented by the receipt.

The right thing to do might be for beneficiaries of this mistake to pay a correct, reasonable price for the items received, so that they, and all other customers, don't end up paying more in the future. But that would require thinking and acting like a non-exploitative member of a broader community.

Did anyone really expect to pay

[gillbates]

Zero dollars?

In Amazon's defense, they advertised "buy one, get one free". So everyone who bought one expected initially to be charged for at least on of the box sets. Some were probably pleasantly surprised to see 0.00 on the invoice, but I don't think any reasonable person expected Amazon to give them two box sets for free.

It would be different if Amazon had advertised "buy one, get one free", and then charged customers for both boxed sets when they ordered two. But they didn't. Instead, Amazon is holding their customers and themselves to the terms of the original advertised offer - buy one, get one free. I fail to see how anyone could have seen the zero dollar charge as the honest price - or how they expected to get something for free from Amazon when their ad clearly indicated otherwise.

Really, how could you not know that a charge of $0.00 wasn't a mistake?

Re:will refuse the charge

[HuckleCom]

Agreed, I think perhaps the return shipment fees should be on Amazon's dime - that way the are immunized from blame of some sort of scam. When it's online I think certain rules apply, and "send it back or be charged" is definately justified.

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:will refuse the charge

[julesh]

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)

As would I. I have little sympathy for the people who jumped on this mistake and tried to milk it. But there are people involved here who did not do this, as well. People who just tried to buy stuff, perhaps didn't notice that they had been charged less than they should have been, and then went on to spend the money they would have spent on the DVDs on other stuff. DVDs are luxury items, many of us have quite limited budgets to spend on such things.

AND you complain when the merchant wants to correct it.

The merchant is perfectly entitle to correct it, IMO. Here's how they should go about doing this:

1. Write to the customer, apologising for the problem, and asking them to either (a) pay for the item or (b) fill in a simple form so that Amazon can arrange a convenient time for them to send somebody around to collect the unwanted item, at Amazon's own expense, and with a minimum of inconvenience to the customer.
2. When, inevitably, large numbers of people do neither of these things, send them an invoice.
3. When, inevitably, large numbers of people do not pay the invoice, send a notice of recovery of debt in a court of law.
4. When, inevitably, large numbers of people ignore this letter, take one of them to court, and ask a court whether it believes the money can legally be recovered. If it can, then take the rest to court.
5. 
   
   
   How this is different from what Amazon are doing:
   
   
   1. People who have honestly made a mistake, and cannot afford the items they have purchased, should be allowed to return them. The mistake is Amazon's, so it should not inconvenience these people. Amazon are not allowing returns of opened packages, and are not making it as easy as possible for people to return the packages. They should be doing both of these things.
   2. Unexpectedly putting a charge on somebody's credit card could cause them all kinds of hassle, additional charges for going over credit limits, etc. They may not have received the correspondence from Amazon for a variety of reasons, or may just have discarded it as junk mail. These people shouldn't be penalised for Amazon's mistake.
   3. The legal situation is far from clear. As I see it, it may well be that Amazon cannot legally recover this money. For them to use some dubious method to do so anyway would be extremely bad.
   
   
   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.
   
   You're probably talking about Sherwood v Walker [pitt.edu]. Note this text:

   Soon after, the plaintiff tendered to Hiram Walker, one of the defendants, $80, and demanded the cow. Walker refused to take the money or deliver the cow.

   
   
   The vendor decided to cancel the contract before taking payment, not afterwards. This makes a substantial difference.

Re:will refuse the charge

[jedidiah]

I dunno. Amazon are big boys. They have lots of professionals working
for them and they only have to worry about policing a single storefront.
They really should be expected to be able to manage their own business.
If they are unable or unwilling to catch their own "mistakes" before
their customers do then they should have to eat the loss.

Also, it is not a given that those that benefit from the error are acting
in bad faith. Not everyone lingers on Slashdot or Digg all day waiting for
this stuff to come up.

Re:Make it a lesson learned

[gstoddart]

Eat the cost, (seriously, how many folks really did order more and get the lower price) and chalk it up as the price you pay for not hiring programmers that can do simple math and going with the cheap ones instead.

Maybe they did, and maybe it was just an honest thing that didn't get properly QA'd -- bugs *do* happen in software, as most people here can attest since we write and maintain it. But, testing is their responsibility before they have customers using it. If Amazon made the mistake, then Amazon can eat the cost of it. I agree with with you on that point.

Just modify the test "Vishnu has four arms. Ganesha rips off two of them. How many fingers does Vishnu have left?"

Unless you have any evidence to suggest that outsourced Indian programmers who can't add are responsible for this, that just seems way over the top. Sad to see that racial intolerance will get you a +5 insightful mod on Slashdot nowadays.

For all you know the guy who fscked this up is a white American protestant living in Buttfuck Idaho -- possibly a whole team of them. Basically saying it's the fault of a bunch of illiterate Indians is pointless.

Cheers

Re:will refuse the charge

[AnotherHiggins]

Isn't this basically like the following scenario?

I walk into a store and pick up a item. I take it to the register. It scans at the wrong price. The cashier doesn't notice. He hands me a receipt, bags my item and wished me a good day. I leave the store. The transaction is complete.

Personally, If I got outside and realized I hadn't paid for something, I would return to the store and hand over the money due. But could the store, upon realizing their fuckup, unilaterally decide to place a second charge on my credit card? I hope not.

To reiterate: I agree that ethically folks should be willing to pay the advertised price. But legally can Amazon demand that they do?

Re:The wise customer

[Anonymous Coward]

In point of fact, I daily see specials at Fry's and other computer/electronics stores which advertise 'free' merchandise. Usually with a mail in rebate, but occasionally with a register discount. These are legitimate deals that are being offered as loss-leaders to get me into the store (and in the full knowledge that most people won't bother to fill out the mail-in-rebate). So I would hardly be surprised to receive two DVD boxed sets for free from an online retailer (especially if I was ordering other things as well). So here's the summary as I see it.

1. Anyone who took advantage of the mistake intentionally with the full knowledge that it was a mistake is morally in the wrong (I'm not going to speak to legalities since IANAL).
2. Anyone who took advantage of the mistake without that knowledge has done nothing wrong and is entitled to be treated with the respect due to a legitimate customer.
3. There is no way for Amazon to differentiate between 1 and 2 above.
4. Therefore the ONLY acceptable course of action if for Amazon to REQUEST (not require) that customers who received the 'extra' free set either (a) pay for that set or (b) return it.
5. Amazon has NO right to expect that either set will be unopened at this point and therefore should not make that a condition of return (though they may indicate that they would PREFER to receive payment if the set has been opened).
6. Legitimate customers should (morally) do either 4(a) or 4(b) above.
7. Amazon should eat the costs for those who do not whether it is because they intentionally took advantage of the mistake or simply because they are unwilling to go to any trouble on Amazon's behalf after the fact.
8. It is not right for Amazon to charge a credit card unless that charge has been specifically authorized (even if it is for an amount that is legitimately owed to them for a transaction that was originally authorized on that card; credit card companies have made that abundantly clear).
9. Therefore if Amazon continues their present course of action, regardless of any other factor, they deserve to be (a) charged-back for every illegitimate charge that they make to a credit card and to (b) receive censure and/or fines from their bank/merchant account for the excessive number of charge-backs (depending on the terms of their contract/account).
10. Because Amazon is such a humongous company doing so much business, it is unlikely that 9(b) will occur. That does not make 9(a) any less appropriate.

Re:will refuse the charge

[Fred_A]

It seems to me that you're confusing the law and morality. I don't know where you got into your head that one had anything to do with the other...

Re:will refuse the charge

[Khuffie]

This isn't the same. Looking at the flyer with a printer error doesn't make you cough up the cash. When you go to the store, the clerk there can telll you there was a printing error, the price is actually $8001, and to apologize for the inconvenience. In fact, these things happen often, and you tend to see correction notices posted around the store if such a thing happens. In this case, you haven't paid for the product, received it and opened it. Which is what's happening with Amazon. They are charging you because of a mistake on their end AFTER the transaction has been completed and you have received the item.

Re:Not so simple

[Sancho]

This is probably true for most cases, but what about people who bought other items during the transaction? The transaction was complete, consideration was given to both sides, and if the price came out a little lower, maybe the customer didn't even notice?

Also, how does your example work out for a site which offers something for free? Are you suggesting that after the fact, they should be able to charge you for the promotion? Although we have testimony from people that the box sets probably weren't advertised as free, the only proof we have for the transaction itself is the receipt, which clearly shows a 0.00 charge (and this is often what shows up during a promotion when something is given away for free).

It's a bad situation all around, but in my opinion, it boils down to this: Amazon screwed up, and a non-zero number of customers who were legitimately shopping got screwed in the process. Amazon should suck it up and not break the law by charging those customers.

This is not as black and white as some would think

[Dagmar d'Surreal]

So far, this thread has mainly been composed of two groups of opinions. The first opinion, which is definitely the minority so far, is claiming that these customers are morally obligated to pay Amazon the money that Amazon was supposed to have charged them in the first place.

The second group seems to simply be saying "Screw 'em. The law says it's a done deal and no takesies-backsies."

Both of these responses are actually equally valid, taken away from their context, and both seem to be rooted in a sense of what is "fair". Which of the two is the usefully "correct" answer given the context has yet to be addressed, so I'll address it.

People should be treated as you'd like them to treat you. It's as simple as that. Good people make moral decisions. They do what's "right". Anyone arguing this? Of course not. The problem is that this is not the context in which this transaction took place. Amazon is not a person. Amazon is a corporation. This does not automatically mean one should be looking to screw them over, so follow along carefully.

Corporations, unlike people, do not make moral decisions. They make decisions based on profit margins and a curious thing called "stockholder interest", which, while it does involve people, has little to nothing to do with morality. It's simply a fact that even if someone in the corporation dared to make a decision where the moral response differs from the profitable solution by any significant degree, the organization would consider the un-profitable moral response to be incorrect (and probably fire that person if it was a large enough difference). Corporations are amoral, which is different from "immoral" so if you're having trouble understanding this, use the intertubes to look up the meanings of the words.

Taking the context of the situation into account, the customers, from a purely moral standpoint shouldn't have made the deal they did. However, you can pretty much bank on the fact that the corporation would not be making this same distinction. Corporations, while enjoying the benefits of being declared a "business entity" can be counted on to go with the letter of the law and no further in a situation involving assets of almost any kind, including money, and for this reason these customers should treat Amazon the same way Amazon would treat them. By the letter of the law, these customers owe Amazon no more money than what they were charged, Amazon would be breaking the law by charging their credit cards after the fact, and the customers should fight them every step of the way because that's what Amazon would do if the roles were reversed, simply because it would be profitable for Amazon to do so, and seldom does the issue of the morality of a business decision ever become challenged. When a non-entity which has no moral incentive is granted rights by law to be an "entity" with the same rights as a person--by acting in an amoral fashion they have to accept that their customers will behave with the exact same level of self-interest if the corporation being given these rights is to be anything approaching fair. Otherwise, ethically speaking, a corporation is no more than a paper facade for large groups of people to make decisions and interact with other people without being hindered by moral judgements. Fail to understand this, and the corporations will eventually gobble up everything.

Re:will refuse the charge

[DM9290]

"while with the Amazon situation the buyers were aware of the mistake on the seller part, something which makes the case simpler to me."

Amazon will eat the cost if anyone refuses to pay or return. I've dealt with amazon before and twice they've sent me the wrong item and I just refused to return it at my expense and Amazon told me to just keep it with their compliments. That is to say: they refunded the purchase price AND let me keep the item.

They can't correct a mistake by billing your credit card without consent. Their only remedy is to take you to court if they really think you owe them. However they wont bother because they would lose. They can't prove that the buyer contributed to them making a mistake. The buyer is only on the hook if the buyer CAUSED the mistake in the first place by commiting fraud. Just because I notice you making a mistake that doesn't make me responsible in any way unless I commit fraud or try to conceal your error from you.

A mere anulling of the contract would not allow Amazon to charge you. If there is no contract then IT IS A GIFT.

You've got it in your hands and you didn't steal it. The lawful owner SENT IT TO YOU. Its yours.

What proof is there Amazon actually did this by accident? By your legal theory Amazon could send out DVD's to random people and then since there is no contract charge their credit cards afterwards.

In fact: without a contract, its yours to keep or dispose of as you wish. Amazon could never establish in court that this wasn't a scam on their part and it sure as hell looks like a scam if they are violating credit card vendor agreements and billing credit cards without authorization.

So as to not be unfair to Amazon. I am repeating that based on my experience with Amazon, I am quite confident they will EAT the loss and be gracious about it.

Re:will refuse the charge

[Skreems]

Ah, but that's BEFORE the transaction. If you then follow through and GIVE me $100, you can't come back a week later and say, "Remember that $100 I gave you? Well, I didn't mean to, and I want it back now." Well, you can say it, but you have no legal recourse to demand it back. Once ownership is transferred, it's a done deal. In this case, Amazon went through the standard order process, and just happened to come up with a $0.00 charge on some orders. That's their mistake. They can ask nicely for the people involved to return the merchandise, but they have no legal grounds to do so. Your example explains perfectly why they can and do adjust pricing if they discover a mistake BEFORE an order is charged and shipped. But in this case they're trying to do it after the fact, and that's a completely different story.

Re:Say this were brick-and mortar

[nasch]

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.

One time I went to a restaurant to get some take-out. It was their first day in business, and the cashier handed me my food and said "no charge". I said, "really?" (thus giving them an opportunity to correct a mistake or say just kidding), got confirmation that the food was free, and left. I would have been quite upset if they had then charged my credit card for the food without asking me (on principle, not because I can't afford it). This is exactly the same situation - Amazon told the customer "no charge" and shipped the product, and now they're charging without authorization. The only difference is there's no cashier, just software, so nobody to ask "did you get that price right?" I agree with everyone siding with the customers here. It makes no difference why the customers did what they did; Amazon is committing fraud by charging credit cards without authorization. The most they should be doing is asking the customers to please return the merchandise or accept a charge for X amount. If the customer refuses, leave them alone. Amazon's mistake should be Amazon's loss. Reminds me of what someone said in a movie: "I am altering the deal. Pray I don't alter it any further."

Re:The wise customer

[frinkster]

It comes down to contract law I suspect

Yes, lovely lovely contract law, which, when push comes to shove, really just says that a contract means what the two parties thought it means when they agreed to the contract.

If an American company and a British guy were to enter into a contract in which the American company were to provide boots to the British guy and the American company knew full well that the British guy thinks boots are those storage spaces at the back of automobiles, the American company would get in trouble if they shipped the guy a box of calf-high footwear.

Oh, but the contract says boots! Tough luck! Not quite. Amazingly, common sense would prevail.

If Amazon is offering a buy one, get one free sale and the customer knows that Amazon is offering a buy one, get one free sale then if the customer acts upon that sale, it doesn't matter so much what the contract (bill of sale) says, it MEANS that the customer is going to buy one and then get one free. There was simply an honest mistake in the contract. What becomes of such a thing?

1) If the customer knows the contract is a mistake and goes ahead with the intention of profiting, it borders on fraud.
2) If the customer doesn't realize that it is a mistake ("ooh I must be the lucky 100th buyer, I get both for free!"), then the contract is simply invalid. As you know, a contract is only valid once both sides receive appropriate consideration! Paying nothing or nearly nothing for $50+ worth of DVDs is not appropriate consideration.

Amazon is acting like a good corporation, assuming you are an honest person and asking you to either return the unopened DVDs to make it like the contract never happened or to pay the price they intended to charge you to make the contract a valid contract.

Consumer protection laws are not likely to come into play. First, they protect consumers acting in good faith. If you were to challenge credit card charges or cancel a card to avoid paying, who is going to believe you are acting in good faith? Certainly not a judge. Second, if you were to act like a proper citizen and take the high road while still maintaining that you should be entitled to the whole thing for free, Amazon is not going to pursue it very long. They have better things to do; they'll just refund your money and offer an apology.

Re:will refuse the charge

[RobertM1968]

Partially wrong. In many states, counties or towns, Amazon could get sued for their actions under numerous charges. The price advertised at check-out is final - regardless of how Amazon came to that error. Period. It IS the law in many jurisdictions, and in those places, Amazon (assuming they are doing so there) would be guilty of credit card fraud and various other charges if they attempted to charge a person's credit card who wanted to keep the merchandise. As one (of many) examples: Westchester County, NY.

Re:The wise customer

[vux984]

Here's another analogy. But in reverse.

You go to WalMart and buy a sleeping bag that was mispriced at $500. (perhaps some toddler moved the sticker from some other product.) Perhaps you didn't even see the sticker, but you know from having looked previously that the price is around $50 bucks. However the clerk at the counter mindlessly rings you up for $500.00 instead of $50. And without paying attention you sign your cc slip and happily and walk out of the store. A few days later you realize you've paid $500, a clear mistake, and you take the bag and receipt back to Walmart and ask for your money back.

If walmart were to say, "its a completed sale, its got a $500 sticker on it, its wasn't advertised as less anywhere else in the store the day you bought it, so no refunds; you were clearly appraised of the price at checkout, and you even signed your credit card slip" you'd probably throw a SCREAMING FIT.

Why is it ok to screw amazon, but a dirty sin if you get screwed?

Fwiw, I think amazon probably doesn't have a much of a legal leg to stand on in reclaiming the funds. However, they are indisputably in the right morally, and anyone that deliberately took advantage of this is morally bankrupt, doubly so if they aren't willing to make amends.

Reminds of a law & order episode, where some girl agreed to be a surrogate mother for a childless couple in exchage for cash, and then acts depressed and threatens to have abortion in order to extract additional money and gifts from the couple... turned out there's nothing actually illegal about that either...

I guess its ok then.

Sociopaths.

(PS The "you" in the analagies above refers to the people who took advantage of amazon, not the parent poster.)

Re:Sale has already been completed

[DreamingReal]

Interesting quote from a woman who was an icon for an organization that promotes tithing part of one's earnings to them as "good works" that will help gain entry to a mythical afterlife and preaches morality and resistance to sin, all the while knowingly and covertly protecting pedophiles and rapists in their midst who have ruined countless lives. People may cheat you indeed.

Re:will refuse the charge

[Shakrai]

When it's online I think certain rules apply, and "send it back or be charged" is definately justified.

It doesn't matter if it's justified or not. It's most likely a violation of their agreement with the credit card processing company and it's certainly a violation of the customer. If I agree to a $100 invoice and approve the charge on my card they can't later change that to $200 because they screwed up.

All that said, I have a lot of respect for Amazon and have done a lot of business with them. It's pretty low to take advantage of their mistake like this. But it was their mistake and that doesn't mean that they get to change the rules and start charging peoples cards after the fact.