California Investigates Retailers for Charging Different Prices Based on Your Personal Data

What Is Surveillance Pricing

Surveillance pricing is when companies use your personal data to charge you a different price than they charge someone else for the exact same product at the exact same time. You might pay $15.99 for groceries while your neighbor pays $12.99, based entirely on what the company knows about each of you.

The practice relies on data that companies collect about you:

• Your shopping history and purchase patterns
• Internet browsing behavior and what sites you visit
• Your physical location and where you live
• Demographic information like age and income bracket
• Inferences companies make about your willingness to pay

A 2025 Consumer Reports investigation of Instacart found price variations for identical groceries ranging from 7 cents to $2.56 per item. Some items differed by up to 23% between customers, with no obvious explanation for why one person paid more than another.

California's Investigation

On January 27, 2026, California Attorney General Rob Bonta announced an investigative sweep targeting surveillance pricing practices. The investigation focuses on businesses with significant online presence in retail, grocery, and hotel industries.

The California Department of Justice is sending inquiry letters to companies asking for details about:

• How they use consumer data to set prices
• Their policies and disclosures regarding personalized pricing
• Any pricing experiments they have conducted
• Measures taken to comply with pricing, competition, and civil rights laws

The investigation is grounded in the California Consumer Privacy Act's purpose limitation principle, which restricts how businesses can use personal information. If companies are using your data to manipulate prices without telling you, they may be violating state law.

Why This Matters for Consumers

Dynamic pricing itself is not new. Airlines have charged different prices for seats based on demand for decades. But surveillance pricing takes this further by making prices personal rather than market based.

The problem is that most consumers have no idea this is happening. You might assume that everyone sees the same price on a website, but your browsing history, location data, and past purchases could all be factors in what you pay.

Under the CCPA, consumers have the right to understand how their personal information is being used. If companies are using your data to set differentiated prices without clear disclosure, you are being kept in the dark about a practice that directly affects your wallet.

New York Takes It Further

California is not alone in scrutinizing this practice. New York recently passed the Algorithmic Pricing Disclosure Act, which took effect in November 2025. It is the first US law to directly attach civil penalties to surveillance pricing.

Under New York's law, companies face penalties of up to $1,000 per violation. This represents a shift from regulating data collection to regulating what companies do with the data they collect. The law creates financial consequences for using personal data to charge consumers more without transparency.

California's investigation may lead to similar enforcement or new legislation that creates clearer rules for personalized pricing.

How to Protect Yourself

While the legal landscape evolves, there are practical steps you can take to limit surveillance pricing:

• Use private browsing: Shopping in incognito mode can prevent some tracking of your browsing history
• Clear cookies before shopping: This removes some of the data companies use to identify return visitors
• Compare prices across devices: Check if prices differ on your phone versus computer or a friend's device
• Use a VPN: This masks your location, which may affect geo based pricing
• Opt out where possible: Exercise your CCPA rights to opt out of the sale or sharing of your personal data

None of these steps are foolproof, but they can reduce the amount of personal data that feeds into pricing algorithms.

What Happens Next

California's investigation is in its early stages. Companies that receive inquiry letters will need to respond and explain their pricing practices. Depending on what the investigation uncovers, this could lead to enforcement actions, settlements, or new regulatory guidance.

For consumers, the key takeaway is that the data companies collect about you extends beyond targeted advertising. Your personal information may directly affect what you pay for everyday goods and services, often without your knowledge.

The growing regulatory attention to surveillance pricing suggests that transparency requirements may be coming. Until then, understanding that prices are not always equal for everyone is the first step toward protecting yourself.