Costco Class Action: Are Online Prices Secretly Higher Than In-Store?

A class action lawsuit alleges that Costco misleads customers by not disclosing when online products are priced higher than in stores.

Plaintiff Annie Song filed the lawsuit against Costco Wholesale Corp. on June 12 in a Washington federal court, citing state consumer law violations.

Song, a Costco member, contends that the company deceptively increases prices on items sold online at Costco.com without informing consumers. She claims that Costco promises on its website to disclose when an online product costs more than the same item in-store.

“Despite this explicit assurance, Costco regularly fails to inform consumers when they pay more online for a product available for less at a local Costco warehouse,” Song alleges. 

Costco Shopper Claims She Paid More for Toilet Paper Online Than In-Store

Song says she placed an order for personal items totaling $145.52 on Costco.com for two-day delivery in January.

She alleges none of the products she purchased online included a notice of potentially lower in-store prices. Song now believes some items she bought were more expensive online than in-store.

For example, Song purchased a 30-roll pack of Charmin Ultra Soft Bath Tissue for $33.49. She says Costco did not disclose during her transaction that the same product might be cheaper in-store.

“However, the exact same 30-Roll Count of Charmin Ultra Soft Bath Tissue that Plaintiff purchased online cost only $29.99 at the Costco warehouse,” she says. 

Costco Accused of Failing to Disclose In-Store Savings on Website

Song argues she wouldn’t have made the online purchase if she knew she could buy the same toilet paper in-store for about $4 less. She claims Costco breaches its promise by “fraudulently omitting” online price mark-ups.

Song seeks to represent anyone who purchased items for delivery through the Costco website or app and paid more than the in-store price without a disclosure about potential in-store savings.

She is suing for state consumer law violations and seeks class action certification, damages, fees, costs, and a jury trial.

Is Costco Shortchanging Its Customers?

Costco has frequently been sued for class action claims in the past. In 2020, Costco agreed to a $5 million settlement to resolve claims that the company failed to pay its employees for all hours worked, including overtime, and did not provide required meal and rest breaks. The settlement included compensation for unpaid wages and adjustments to their employment practices.

In 2019, Costco agreed to a $4 million settlement, including refunds for consumers and changes to its labeling practices after it was accused of mislabeling certain food products as "organic" when they allegedly did not meet organic certification standards. 

Case Details

• Lawsuit: Song v. Costco Wholesale Corporation
• Case Number: 2:24-cv-00845 
• Court: U.S. District Court for the Western District of Washington

Plaintiffs' Attorneys

• Kim D. Stephens and Cecily C. Jordan (Tousley Brain Stephens PLLC) 
• Sophia G. Gold and Jeffrey D. Kaliel (KalielGold PLL)