As coronavirus rages, a Fort Worth-based gun shop is accused of price gouging
Gerald Cathey wanted to stock up on ammunition when the novel coronavirus began to spread across Texas.
So the 49-year-old River Oaks man began looking online at gun and ammo shops.
When he looked at the website for Fort Worth-based Cheaper Than Dirt, he said prices for ammunition were three times the normal market price.
So he filed a price-gouging complaint with the Texas Attorney General’s office.
He wasn’t alone.
Throughout Texas, 123 complaints have been filed against Cheaper Than Dirt since Gov. Greg Abbott declared a statewide emergency on March 13, said Kayleigh Date, a spokeswoman with the AG’s office.
There were 158 cases of price gouging filed against businesses in Tarrant County between March 17-24, according to documents obtained by the Star-Telegram through open records request. Thirty of those complaints were against the online retailer Cheaper Than Dirt, which received more complaints in Tarrant County than any other company. Many of those complaints were filed from people who don’t live in Texas.
“It is important to note that these complaints do not necessarily reflect a legal determination by our office,” Date said, adding that investigations are confidential.
Cheaper Than Dirt did not immediately respond to a Star-Telegram request for comment about the complaints.
The company has posted a note on its website that it is “experiencing unprecedented high volume” and that warehouse staffers are “working around the clock” to process orders. The note states that “due to the volume of emails, please allow 3-5 days for a response.”
Complaints also were filed against a variety of businesses in Tarrant County — grocery stores, gas stations, pharmacies, specialty food markets and an animal hospital.
Many of the complaints cited inflated prices of bottled water, toilet tissue, meat, milk, hand sanitizer, masks and Lysol. Those complainants said they believed price gouging was occurring in the wake of coronavirus in Tarrant County.
Hiking prices
Cathey, who describes himself as a free-market capitalist, said he understands if prices go up some on items that aren’t, for instance, food or milk.
But he said he’s seen Cheaper Than Dirt hike prices when there’s a rush on buying guns or ammunition, such as when Barack Obama was elected president.
“They lifted their prices considerably above what I would consider reasonable ... (during) any crisis that might affect (gun) ownership,” he said.
Cathey said he ultimately was able to find affordable ammunition at a different online retailer.
One of the complaints against Cheaper Than Dirt noted that a 1,000-round box of 5.56 ammunition sold for about $300 before March 15. On March 17, the price was more than $800.
Another complaint stated that ammunition “that sells normally for $100-$150 is now priced as high as $900 on the website. This is for all ammunition in all calibers.”
A third complaint stated a 1,000-round box was listed for $257.24. “But when you go to make the purchase and check out, the price suddenly jumps to $499.89.”
Bruce Hill, a 26-year-old from Marshall, also filed a complaint against Cheaper Than Dirt.
He, too, saw prices he believes are way out of line at the online gun shop.
“Every time there’s a crisis, they are the first ones ... to try to make a dollar off people panic buying,” Hill said. “Any time there’s a national disaster, a shooting, they’re the first ones to start hiking prices.”
He said he has a “decent stockpile” of ammunition, but was looking to see what prices were online.
“Most other retailers were trying to keep prices as fair as they can,” he said. “As manufacturers are pumping up production ... that’s driving prices up a little bit.
“Fifty cents a shot, 40 cents a shot is what you’d expect,” Hill said, adding that Cheaper Than Dirt went from around 20 to 25 cents a shot to “$1 a shot overnight.”
Price gouging penalties
Date said the AG’s office “uses complaints to monitor trends and take action when appropriate and in the public interest.” And she noted that a large number of complaints against one specific company can “contribute to initiating investigations.”
The AG’s Consumer Protection division evaluates complaints to determine if prices have been inflated during a disaster declaration.
If the department determines there has been price gouging, the offending company or person may have to reimburse shoppers and can face civil penalties of up to $10,000 per violation, with another penalty of as much as $250,000 if the consumer is elderly, Date said.
The AG’s office received 4,049 complaints across the state about price gouging between March 13 and March 31.
Complaints be filed by calling the Texas Attorney General at 800-621-0508. Complaints also may be filed at texasattorneygeneral.gov/consumer-protection.
“My office will work aggressively to prevent disaster scams and stands ready to prosecute any price-gouger who takes advantage of those taking precautions and looking for safety and supplies,” Texas Attorney General Ken Paxton has said.
This story was originally published April 16, 2020 at 6:00 AM.
