N95 Manufacturer 3M Sues Companies Selling Masks For Alleged Price Gouging, Fraud

N95 mask manufacturer 3M filed multiple lawsuits alleging price gouging and fraud by companies selling the masks at inflated prices amid the coronavirus pandemic.

“3M launched this ambitious effort to prevent and stop fraud at the same time as we have been rapidly increasing production of N95 respirators and other needed supplies to combat COVID-19,” Senior Vice President of Corporate Affairs Denise Rutherford said in press release.

“The schemes we shut down were not only unlawful, they also endangered lives and wasted precious time and resources by diverting buyers from legitimate sources of much-needed respirators. We will continue to partner with law enforcement and online retailers to take action against profiteers.”

The company said it has received more than 4,000 reports of fraud and price gouging since it ramped up mask production in March to meet growing demand by hospitals and private citizens. One company, identified as Legacy Medical Supplies, allegedly sold 3M products marked up 75% to 267% above 3M’s list price.

Seventeen lawsuits were filed against other companies for similar behavior during the pandemic.

“Online, 3M successfully secured the removal of more than 7,000 e-commerce listings with fraudulent or counterfeit product offerings and more than 10,000 false or deceptive social media posts to date,” 3M said in its press release. “3M has not, and will not, increase the prices of its respirators as a result of the pandemic. Any damages we recover in lawsuits are donated to COVID-19 relief efforts at nonprofit organizations, including Direct Relief.”

3M, along with Honeywell and Prestige Ameritech Ltd., emerged as one of the largest manufacturers of masks during the coronavirus outbreak after it hit the U.S. in February. The company said 90% of the masks it produced before the pandemic went to “industrial uses,” but it has since flipped, supplying more than 100 million N95 masks to U.S. hospitals and more than 100 million to rebuild the federal government’s stockpile.

However, 3M has faced criticism for an apparent lack of accountability and “global” focus while the U.S. emerged as the pandemic’s epicenter.

“You can't ghost the American people,” Dallas Mavericks owner and entrepreneur Mark Cuban told Axios in April.

“It's great that they’re doubling their production to 2 billion masks a year, but when you look at what they're doing here in the U.S. — the country they’re based in, the country they were founded in — according to their own numbers, they produce 110 million masks a month globally, 35 million masks a month domestically.”