Laddergate: Microcosm vs. Webstaurantstore; Fraud? Definitely not Legit.

Usually, when we tell strangers that we work in publishing, they picture us crafting the latest bit of editorial brilliance from an emerging, young mind over a candle-lit typewriter. Or they mourn the death of the publishing industry with some imaginary dreck like “nobody reads anymore.”

For better (and some days, for worse), paper books remain more popular than ever, especially with young people. This leads to an ever-increasing volume of warehouses, shelves, racking, paper, trucks, and…safety ladders. And this leads us to a snapshot of one of the key roles of a publisher in any era: negotiating with suppliers and figuring out material flow logistics.

a warehouse full of pallet racking and boxes

We organize our warehouses so that the most popular books are on the floor for easiest access. As books get older and less popular, they are placed higher and higher in the stacks, until they require a ladder to retrieve.

During the pandemic supply chain crisis, we were at the mercy of material shortages and manufacturer delays. It took three times as long as usual to print a book. But it wasn’t just books. On October 18, 2022, we attempted to order four more safety ladders from Webstaurantstore. The estimated delivery date was “March 2023.”

“Wow,” I thought. “That is a long time to wait for four ladders. But we need ’em.”

We placed an order for shelving parts at the same time. Another $2,324.99 of your hard-earned money was spent on more of our behind-the-scenes infrastructure.

We waited. On November 7, 2022 we were surprised to receive a delivery from a company called Ballymore. We received no tracking information or advance warning that a delivery was coming, including no information about what was in the order. We were not given a Bill of Lading (the legal document that shows what is contained in a delivery), we weren’t told that this was part of our Webstaurantstore order, and the delivery driver did not even request the standard signature confirming delivery or allow time for us to inspect the boxes before he left. Upon opening the four boxes on the pallet, they proved to each contain one out of four pieces of a single ladder, which needed to be assembled. And we’ll never forgot that because assembly seemed to take all day.

An attractive orange step ladder

Due to the lack of communication or notices, we were baffled. “Weird. I guess materials are in such short supply that they are going to send these one at a time?” I thought. Honestly, I didn’t think much of it—we frequently receive items from a single order in multiple shipments over a period of time. Our online Webstaurant store order was not marked as complete, so we assumed that the other three ladders were coming in March 2023, as quoted. 

We had still not received the remaining three ladders when we were scheduled to on March 21, 2023, so we followed up with the Webstaurantstore. Instead, we were told that it was too late to notify them of a shortage, since it was more than 5 days since the delivery of the single ladder. They updated our shipping status to “delivered.” We argued that it was less than five days since the items were expected to be delivered. They told us that their records showed that we had received four ladders, none of which should have required assembly and insisted that three ladders were lost in our warehouse. “Look around and you’ll find them” was their solution. It was as insulting as it was baffling, as if we would contact them before “looking around” and had somehow managed to misplace three seven-foot ladders. They said there was nothing that we could do.

When it became clear that Webstaurantstore’s claims were illegitimate and they were not going to send us the ladders that we had paid for, we filed charges with Mastercard on March 28, 2023 because the merchant was not interested in resolving the matter. On April 4, 2023 Mastercard attempted to close the case in our favor but Webstaurantstore persisted.

On May 15, 2023, Webstaurantstore responded to the complaint but did not send sufficient documentation to dispute the refund. Then a week later, on May 23, 2023, our claim with Mastercard was denied, as, in the words of the Mastercard rep, “Usually a merchant does not go this far or provide this much paperwork…unless their ability to accept Mastercards due to a volume of disputes is being threatened.”

a microcosm warehouse worker with green hair shows off a large pallet of outgoing mail

How did they do it? Webstaurantstore falsely asserted that we had signed for the shipment and they “found” the bill of lading that had disappeared. Suddenly, they had “proof” of shipment to provide and claimed that we had waited past Mastercard’s 90-day window after delivery. They sent shipping proof for the single ladder as “four pieces,” claiming it was four ladders. They adjusted facts and timelines as was convenient for their argument. They argued that the estimated delivery timeline and lack of communication were irrelevant, so the 90-day window would be calculated from the date of the original order in October. They tried to claim that the unsigned bill of lading was a legal document “proving” delivery. If it was, we had no way of knowing what was allegedly contained in this delivery because it had never been provided to us.

On June 1, 2023 we filed a second dispute with Mastercard, citing that 90 days had not passed since the delivery window, the shipment in question did not contain all of the items that we ordered, there was no communication provided to us that Webstaurantstore believed the transaction was complete, and the bill of lading was never signed or delivered, so we had no way of inspecting it for damage or shortage, as is customary and the purpose of these documents. 

On June 29, 2023 Webstaurantstore again asserted to Mastercard that we do not have charge dispute rights through, as the Mastercard representative put it “Barraging us with a sheer volume of information and paperwork.” but again falsely claiming that the 90-day dispute window after delivery had already passed when first the dispute was filed. This time, Webstaurantstore went so far as to claim that the date when we placed our preorder was actually the date that the items had shipped. 

the labyrinth of metro shelving in our Cleveland warehouse

We looked for other ways to resolve the situation. And this is where things became much more insidious. Since Webstaurantstore is based at 2205 Old Philadelphia Pike Lancaster, PA 17602, we filed a complaint both with the Better Business Bureau (BBB) and the Pennsylvania attorney general. Both organizations seem strangely powerless and act more like dispute mediators than having any authority over a private business (“participation in the Bureau’s mediation process is voluntary for both sides, and we cannot compel a business to agree to a solution.”) that apparently does billions of dollars in annual revenue for the state.

BBB suggested filing notices with the Attorney General’s Office Bureau of Consumer Protection in both Ohio (where they were delivered) and Oregon (where we are based), but these organizations disagreed that this was appropriate. So we explained Webstaurantstore’s deceit to Mastercard once more, who agreed that they were obfuscating the facts and attempted to try again.

a worker pensively waits with two pink pallet jacks for a truck to unload pallets

We repeatedly called the Webstaurantstore customer service number, (717) 392-7472, thinking that if this company is as legit as they claim, they would understand that a perfect storm of events had gone wrong and resolve it. Instead, we were issued a concerningly lengthy claim number, 20231100079631, which would indicate that we are close to their 80 thousandth case of not delivering what someone paid for (or if you ignore what is likely a date, more amusingly, their 20 trillionth). Indeed, each customer service person variously implied that we were confused or lying. Perhaps this “perfect storm” was a feature, not a bug?

Webstaurantstore does not appear to have the ability to be reviewed on Google, but does have a fraudulent page of glowing “google reviews” that they maintain themselves. Clever, misleading, and somewhat baffling.

While the Pennsylvania Attorney General said “you are free to pursue a lawsuit privately,” it turns out that this isn’t entirely true. You see, Webstaurantstore has a particularly shocking “Terms of Service” document:

“You agree that any disputes and claims related to or arising from these Conditions of Use and/or your use of this website, including disputes arising from or concerning their interpretation, violation, invalidity, non-performance, or termination, will be resolved through final and binding arbitration under the Rules of Arbitration of the American Arbitration Association applying the laws of the Commonwealth of Pennsylvania, instead of in court. An exception is that you may assert claims in small claims court, if your claims qualify. To begin an arbitration proceeding, you must file a Demand for Arbitration with the AAA, according to the AAA’s rules. Payment of all filing, administration, and arbitrator fees will be governed by the AAA’s rules. We will reimburse those fees for claims totaling less than $10,000 unless the arbitrator determines the claims are frivolous. Likewise, WebstaurantStore will not seek attorneys’ fees and costs in arbitration unless the arbitrator determines the claims are frivolous. You may choose to have the arbitration conducted by telephone, based on written submissions, or in person in the county where you live or at another mutually agreed location.”

This sounds reasonable until you learn that the AAA arbitration fees would cost us a total of $1,725, for a dispute of items costing $1,142.59. It appears that these policies are intentional. Particularly after we learned about the multitude of lawsuits that Webstaurantstore receives from its own employees about alleged illegal labor practices, or as one former employee filed in a lawsuit, they “have not been provided real access to arbitration.” This was very concerning, as is the principle of the matter and our commitment to preventing this from happening to others.

Despite the fact that we did not sign a contract, this is significantly more expensive than a lawsuit costs to file. Fortunately, their terms of service are probably not legally enforceable.

Since we were not made aware that Webstaurantstore erroneously claimed that the order was delivered in full and they did not communicate this fact to us, we remain incapable of fulfilling and agreeing to the terms of sale. Hence, we were not able to notify Webstaurantstore about the delivery shortage within their timeframe because they changed the delivery time frame of the delivery without notifying us of this change. 

As I began to research the company, I learned that numerous labor disputes have risen to the level of lawsuits, for everything from retaliation for attempting to collect overtime pay to multiple cases of civil rights discrimination. They also like to argue about intellectual property and have been sued for this as well. And it appears that we were not the only ones who suffered because of their misleading business practices.

Who was this Webstaurantstore? It appears that their game is controlling the SEO around all restaurant equipment, and they are great at this aspect of their job:

One aspect of their strategy is posting innumerable “articles” that would turn up when you search for “Webstaurantstore fraud,” and instead of the hundreds of entertaining stories of customers not receiving what they paid for and third parties blaming each other, you’ll receive “Webstaurantstore’s guide to preventing fraud at your restaurant.” A Forbes article touts that Webstaurantstore earns more in a day than we do in a year.

A friend pointed out the obvious: Microcosm has great SEO so the area where we could best protect potential future customers is through adding this story to their search results. We simply wanted the items that we paid for or a refund. Instead, nearly two years later, we’ve sunk hours into efforts at basic customer service interactions.

We’re still weighing our next steps. We have either until October 2025 or March 2026 (depending on Webstaurantstore’s obfuscations) to escalate the dispute legally. You might be thinking at this point, “Wow, Microcosm is really obsessed with this ladder thing, maybe they should move on.” Are the time and expense worth it to us? Maybe. Definitely not in terms of money—any legal settlement would need to be much larger than the bilking of the ladders in order to cover the time and costs we’ve already sunk into this issue. We could just let this go—we’re large enough at this point that the loss of three expensive ladders won’t sink us. But even just five years ago, it would have seriously compromised our ability to make payroll and we wouldn’t have been able to do a thing about it. We know we’re not the only people who’ve incurred losses by dealing in good faith with this company. We don’t have limitless resources, but it still seems worthwhile to use some of them to try to hold accountable a giant company that does twice our annual revenue every day but won’t make it right when they mess up.

As book publishers, we all know what it’s like to struggle in the shadow of a giant online retailer that plays dirty and seems to relish endless growth at the expense of everyone else in its ecosystem, including its customers. When people ask us what our day to day job is like, they don’t imagine a years-long dispute over ladders, but what else is there? A ladder helps us safely and quickly get you the obscure book you took a chance on, it helps us protect our workers and our colleagues, it helps us always reach higher.

Post Script: Within 24 hours we heard from numerous businesses who experienced the same phenomenon when attempting to order from Webstaurantstore; one of which went out of business afterwards.