3M continued to take decisive action to protect the public from price gouging and fraud for respiratory protection equipment by filing a legal action today in Superior Court in Ontario. The defendants, Zhiyu Pu and Harmen Mander, directors of Caonic Systems, Inc., falsely affiliated themselves with 3M to sell N95 respirators at exorbitant prices during the pandemic.
The defendants registered 3M-Health.com on the Canadian e-commerce platform Shopify, and starting in March, sold respirators they fraudulently claimed originated from 3M certified suppliers in Singapore and the UK. On March 31, at 3M’s request, Shopify closed the site. Caonic Systems immediately reopened another Shopify site as www.tormenhealth.com, and continued to claim an affiliation with 3M on social media. After Shopify shut the second site, Caonic persisted, relaunching briefly on another platform. Caonic was selling the N95 respirators for $17.00 each, more than five times the appropriate retail price.
The Application requests that the Court order Caonic to assist in identifying the location of any remaining respirators and sharing sales and customer information. 3M will assist in evaluating the respirators’ authenticity. If the N95s are authentic, 3M will support returning them for use in efforts to fight COVID-19. If they are not authentic, 3M will inform Caonic’s customers. Once the respirators are recovered, 3M will pursue damages. 3M will donate any damages recovered to COVID-19-related nonprofit organizations.
“At 3M we are working hard to continue to increase production of respirators for the healthcare workers who need them the most in the fight against COVID-19,” said Denise Rutherford, 3M Senior Vice President, Corporate Affairs. “We are dedicated to putting a stop to those who are trying to cash in on this crisis and have taken legal action when we’ve identified illegal behavior in New York, California, Florida, Texas, and now Canada.”
3M has filed a series of legal actions in four U.S. states over the past week. The company is working with national and international law enforcement, state Attorneys General, and the largest online retail and tech companies in the world to identify illegal activity and help punish criminals. Indeed, prior to filing this action, 3M reported the information regarding these defendants to the Ontario authorities. The goal is to prevent fraud before it starts and stop it where it is happening.
3M has deployed its internal litigation team, working closely with volunteers from its network of outside counsel and resources in every part of the country. In this case, 3M is represented by David L. Campbell and Sunny Rehsi from Bowman and Brooke LLP.
3M has not changed the prices it charges for respirators as a result of the COVID-19 outbreak. The company is working with online retailers and technology companies such as Google, Amazon and Facebook to identify and remove counterfeiters and price gougers from their sites and refer them to law enforcement authorities.
Resources to fight fraud
Call 3M’s hotline in the U.S. and Canada (800) 426-8688 for information on how to help identify authentic 3M products and to ensure products are from 3M authorized distributors.
If customers have concerns about potentially fraudulent activity, price gouging, or counterfeit 3M products, they can report their concerns at 3M’s website.
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