Shoppers look to fry e-tailer over pricing mistake

Upset after Egghead.com cancels dozens of orders placed for a mistakenly priced memory module, angry customers say they have filed complaints and are considering legal action.

3 min read
Egghead.com may end up with egg on its face after receiving and canceling dozens of orders for a memory module that was mistakenly priced.

Egghead customers say they have complained to the Better Business Bureau and are considering legal action against the company after it canceled their orders late last month for the 256MB memory module. Normally priced around $335, Egghead listed the module at $34.85 for several hours.

Aaron Davidson is among those who said he filed a complaint online with the Better Business Bureau after Menlo Park, Calif.-based Egghead canceled his order for four memory modules. Davidson, a full-time student in Arlington Heights, Ill., said when he has had similar problems with other e-tailers, the companies have typically given him a gift certificate for his trouble--but not Egghead.

"They handled this kind of poorly," Davidson said.

On HardOCP.com's HardForum message boards, several customers on the hardware review site said they were exploring the possibility of suing Egghead in small claims court or filing a class-action lawsuit against the company.

"This is very irresponsible behavior for any large company," said one HardOCP member, who was considering legal action against Egghead. "You don't think Egghead noticed 5,000-plus orders for one part in a few hours? They should have taken action immediately."

But Egghead representatives said their site clearly informs customers that the company can cancel orders because of pricing mistakes.

"We're pretty clear on our policies," Egghead spokeswoman Joanne Hartzell said. "This was human error absolutely. Someone put in the wrong numbers."

The pricing problem at Egghead comes as Buy.com recently agreed to pay $575,000 to settle a class-action lawsuit over a mistakenly priced monitor. In recent months, Amazon.com and Staples.com have also had to contend with customer ire over pricing mistakes.

Many Egghead customers placed orders for the module after reading about the reduced price on HardOCP.com. HardOCP.com founder Kyle Bennett said he publicized the price after receiving a tip from a reader.

"We put this up in the vein that some people will get some cheap RAM," Bennett said. "But Egghead just didn't take it down. It stayed up for like 15 or 16 hours, and it turned into a big thing."

Dozens of customers placed orders, many aware that the price could be a mistake. But the company confirmed their orders and charged their credit cards. Several customers said they even talked to the company's customer service department, which confirmed the price for them.

But Egghead eventually canceled all of the orders and credited customers' credit cards. Unlike other e-commerce companies such as Amazon, which charges customers' credit cards when the order is shipped, Egghead typically charges customers' credit cards immediately after the order is placed.

Egghead did award $50 gift certificates to a few of the customers affected by the pricing mistake. "When mistakes do occur, Egghead makes case-by-case customer service decisions, and occasionally grants accommodations," Egghead attorney Rodger Cole said in an email to Bennett. "However, Egghead has not made a uniform decision granting a $50 gift certificate for any additional customers that complain about this accidental mispost."

Egghead's Hartzell said she did not know how many customers placed orders for the memory module.

Among those who did place an order was Jim Morris, a financial manager in Fairfax, Va. Morris said he has shopped online for years and has had similar problems at other online stores. He said he was bothered that the price an online store offers is not always a final offer.

"These e-commerce companies want you to use their online ordering; they tell you how secure it is," Morris said. "But they have the ability to cancel your order and say, 'No, we're not going to sell it to you at that price after all.'"

Though some customers said they were considering legal action against Egghead, others criticized their fellow buyers for exploring that route.

When you go to buy an item that has been wrongly priced, "don't get your hopes up," said one HardOCP member who said he ordered three of the memory modules. "If you happen to receive the item for that price, good going...but don't count on it."