3M has sued a medical supply company for allegedly trying to sell its coronavirus-blocking N95 respirator mask for 500 to 600% more than the list price.
3M suit: Distributor tried to sell N95 masks to New York City for 600% above list price
New Jersey supplier allegedly claimed it was affiliated with company.
April 10, 2020 at 11:29PM
The masks are among the most coveted kind of personal protective equipment for health workers treating victims of COVID-19.
3M charged that Performance Supply LLC, a company based in New Jersey, falsely claimed a business affiliation with the Minnesota-based corporation that is a global leader in respirator production.
The suit in federal district court in New York City alleges that Performance Supply tried to sell New York City $45 million worth of respirators. 3M has asked the court to order Performance Supply to stop its illegal activity.
"3M heard about Performance when New York City government officials reached out to us and let us know they'd received an offer for a large amount of respirators," 3M spokeswoman Jennifer Ehrlich said. "They reached out to us to check it out and we confirmed it was not from us, and the prices offered were exorbitant, 500-600% above list prices."
The suit comes as the U.S. and the world scramble to overcome shortages of respirators. 3M recently tangled with President Donald Trump over his objection to 3M selling respirators to customers in foreign countries. At one point Trump appeared to accuse 3M of unfair pricing. 3M CEO Mike Roman pushed back hard, saying the company risked retaliation if it failed to honor international sales agreements. Roman called it "absurd" to suggest that the company was not doing as much as it could to help Americans. 3M stresses that it has not changed prices of respirators because of the COVID-19 crisis.
3M's disagreements with the president have been settled with some international distribution continuing while 3M ships more respirators to the U.S. from foreign production facilities.
What remains critical is finding ways to protect doctors, nurses and other health care personnel dealing with patients who have a virus for which no vaccine exists.
The lawsuit says Performance Supply offered to sell New York City N95 respirators for more than $6 each. The masks typically sell for less than $1.50 each.
In a news release, Denise Rutherford, 3M's senior vice president of corporate affairs, said "3M does not — and will not — tolerate price gouging, fraud, deception, or other activities that unlawfully exploit the demand for critical 3M products during a pandemic."
Rutherford said 3M now works with law enforcement and technology companies to address fraudulent efforts to sell its masks.
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Friday's lawsuit "is the first price-gouging lawsuit connected with our work to fight fraud during the COVID-19 outbreak," Ehrlich said. "We do expect to file more."
Performance Supply officials could not be reached for comment.
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