H-E-B, Costco, Walmart, Albertsons among grocery stores accused of price-gouging eggs in federal suit
H-E-B is one of three Texas-based grocery stores, along with over a dozen businesses nationwide, facing a federal lawsuit after a group of shoppers accused the stores, farms and wholesalers of price-gouging eggs during the coronavirus pandemic.
The lawsuit filed in Austin last Thursday says the San Antonio-based H-E-B Grocery Co., along with 18 other businesses, nearly tripled the price of eggs after Gov. Greg Abbott declared a state of disaster because of the virus on March 13.
The suit offers no evidence of price gouging, however. A similar lawsuit has been filed against California-based grocery stores, citing the same allegations.
The two other Texas-based businesses being sued are Brookshire Grocery Co. founded in Tyler and Lowe’s Markets Inc. founded in Littlefield. Other companies named in the suit include Costco Wholesale Corp., Walmart Stores, Inc., Kroger Co. and Albertsons Companies Inc.
Lawyers representing the shoppers said that because it is unclear which of the businesses participated in price gouging, the five individuals decided to sue all of them.
“As in any time of economic turmoil, there are those who seek to profit from the misery of millions,” the lawsuit says. “Defendants, who are producers, wholesalers, and retailers of eggs, comprise one such set of actors seeking to unfairly profit from the increased consumer demand for eggs in the midst of the ongoing crisis.”
When asked for the specific store locations that are being accused of price-gouging, Alexander McSwain, the attorney representing the shoppers, did not return requests for comment.
The lawsuit says a substantial portion of the events happened in Texas but does not specify if all of the grocery store locations are in the state.
In a statement Friday, H-E-B officials called the allegations in the lawsuit meritless. Officials said while producers’ egg prices did dramatically increase, H-E-B often absorbs such increases so customers do not have to pay more.
“H-E-B lost money on eggs rather than passing the cost increases along to its customers,” the statement said. “It is shameful that we have to deal with this baseless lawsuit, filed without even the barest of investigation into our prices.”
Brookshire officials on Wednesday said they were unaware of the lawsuit. However, like H-E-B officials, said they are doing their best to not increase prices for customers during the pandemic.
“We take any claims about price gouging very serious and investigate the situation immediately,” a statement from the company said. “We are seeing a cost increase in the grocery industry supply chain because of the unprecedented demand across the country, which has effected prices on products. We are doing our best to not pass on the total cost to our customers but we are adjusting some prices. We are adhering to all state and local regulations with regard to price increases.”
Lowe’s did not return calls for comment.
According to the lawsuit, the five shoppers, who are representing a larger number of individuals, are suing for a permanent injunction to stop the defendants from selling eggs at rates higher than 10% of the price before the disaster declaration.
In addition, the shoppers hope to be awarded for damages at an amount determined by the court.
CORONAVIRUS IN TEXAS: What we know, latest updates
The American-Statesman is making this coverage available to non-subscribers at no cost as a public service during the coronavirus outbreak.
Please support local journalism by subscribing to the Statesman at statesman.com/subscribe.
Want to stay updated on the latest news about coronavirus in Austin? Subscribe to our Coronavirus Update newsletter at statesman.com/newsletters.