A number of Amazon Prime members are apparently very happy with the free subscription service Whole Foods delivery offer, and are taking legal action.
The e-commerce giant bought the supermarket chain in 2017, and a year later began offering free shipping on orders of $ 35 or more to Prime members.
Amazon set a $ 9.95 charge for all Whole Foods delivery orders in October 2021. Requests for pick-up orders worth more than $ 35 remained free for Prime members, an Amazon spokesman told FOX Business at the time.
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The service fee is intended to cover the running costs associated with food delivery without having to raise product prices, but not all Prime customers agree that the business practice is fair.
Joy Pecznick and Gil Kaufman, two members of Amazon Prime in the state of California, filed a complaint on May 31 in the U.S. District Court in Western Washington, and are listed as plaintiffs in a 15-page legal document read by FOX. Business.
The complaint argues that Amazon should reduce its subscription service rate by eliminating free shipping.
“Individuals signed up to offer free Whole Foods for the benefit of Amazon Prime, many signed up at a time when they avoided going to stores, and they still do,” said Thiago M. Coelho, one of the class action lawyers he manages. The case of Wilshire Law Firm in Los Angeles in an email to FOX Business.
“Removing the benefit of these people after gaining more membership and market share is worrying for members who were encouraged to sign up for that reason,” Coelho continued.
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The complaint alleges that Amazon tested the costs of the Whole Foods delivery service in the summer of 2021 before expanding nationwide to Portland, Providence, Manchester, Detroit, Boston and Chicago.
He goes on to say that free shipping on Whole Foods orders was a “win-win decision for Amazon,” which helped the company triple its food delivery from 2019 to 2020, which also coincided with the COVID-19 pandemic.
The complaint alleges that “hundreds of thousands, if not millions, of Amazon Prime members paid a membership fee because they wanted to take advantage of Prime’s free Whole Foods free delivery service,” but the offer was “unfairly” removed.
“As a result of Amazon’s unfair business practices, consumers were paid $ 119 for a service that ended unfairly,” the complaint says. “The first members did not benefit from their membership agreement.”
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The Wilshire Law Firm, based in Los Angeles, and Triad Law Group, headquartered in Woodway, Washington, are representing clients in the West End Washington District Group.
The indictment states that “there are more than 100 members in the proposed Class” and demands that the jury be tried.
FOX Business contacted representatives from Amazon and Whole Foods to request feedback.
Amazon Prime memberships include a long list of shipping, streaming, shopping, reading and entertainment benefits, including free shipping on certain non-food products, exclusive offers, access to Prime Video and Amazon Music, Prime Try Before You Buy, early entry. books and more.
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Current Amazon Prime membership fees are $ 139 per year or $ 14.99 per month. Students have a discounted fee of $ 69 per year or $ 7.49 per month.
In previous earnings calls, the e-commerce platform reportedly has more than 200 million Prime members.
The company earned $ 116.4 billion in the first quarter of 2022, according to a quarterly report released by Amazon in April.