The New York State Attorney General’s office sent a formal letter to Instacart on January 8, 2026 demanding detailed information about the company’s algorithmic pricing experiments. The letter cites the state’s Algorithmic Pricing Disclosure Act, which requires businesses that use personal data to set prices to provide a clear and conspicuous disclosure.
Instacart’s spokesperson said the company had ended all item‑price testing in December and that the tests were not personalized or surveillance‑based. The company maintains that it never used personal, demographic, or behavioral data to set online item prices on its platform.
The letter follows a Groundwork Collaborative and Consumer Reports study that found significant price discrepancies for identical grocery items on Instacart, with price differences averaging 13% and reaching 23% in some cases. The study suggested that such variations could cost a typical family of four an additional $1,200 annually. The investigation also comes after the Federal Trade Commission launched a probe into Instacart’s AI‑powered pricing tool, Eversight, and the company’s prior $60 million settlement with the FTC over deceptive advertising and subscription practices.
If the Attorney General’s office determines that Instacart violated the Algorithmic Pricing Disclosure Act, the company could face civil penalties of up to $1,000 per violation and be required to modify its pricing methodology. The probe could also prompt broader scrutiny of Instacart’s pricing strategy and potentially impact its ability to implement dynamic pricing models, affecting both revenue and margin dynamics.
Instacart’s spokesperson emphasized that the company’s decision to end item‑price testing was a proactive step to address customer concerns and regulatory scrutiny. The company said it remains committed to transparency and compliance, and it has not indicated any immediate operational disruptions as a result of the letter.
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