Oregon opens official investigation into Kickstarter sweetheart Coolest Cooler

The Oregon-based Kickstarter-backed company Coolest Cooler is feeling a little heat this week as the Oregon Department of Justice opened an official investigation into the company after receiving hundreds of complaints from Kickstarter backers who had yet to receive their coolers, despite the coolers being available online.

Coolest Cooler, in case you don’t remember, conducted a 2014 Kickstarter campaign that pulled in a whopping $13 million in funding for the rolling party-cooler that came complete with a blender and other party conveniences. But things have not been great for the cooler company. All the way back in April the firm went back to its backers and asked for more money, asserting that the original price was too low to cover the units. Now, 5 months later, the company is receiving scrutiny from the Oregon DOJ as Kickstarter backers are filing official complaints because they have not received their coolers, despite the company offering the coolers on its website for $400 (and shipment within 48 hours no less).

There is always a risk in backing a crowdfunded campaign. Sometimes you just won’t get what you hoped you would, but usually, the reason is that the product or idea failed in production. In this case, the product is out and available to those are willing to pay the full retail price now, while those who paid lower prices through the Kickstarter, enabling the firm to move to production, are only very slowly getting units sent out.

In its latest updates to the Kickstarter campaign the company says it is unable to send out the coolers to Kickstarter backers en masse because of cost considerations. Simply put, the company can’t afford to send them out. The Oregonian is reporting that the Oregon DOJ received some 300+ complaints regarding the Kickstarter-backed company, though Coolest Cooler says the number is closer to 200.

Part of the issue, the company notes, involves Amazon’s Launchpad program. Ryan Grepper, the founder and operator of Coolest Cooler, says the issue lies in Amazon’s decision to sell the coolers for a mere $205, despite promising not to sell them for less than the advertised retail of $400. This means that the company is making no profit on the coolers it is obligated to ship out, and the result is that the retail sales they are making now are being used to increase inventory and keep the company going so that the Kickstarter units can be sent out.

It is a sticky situation all around, and the Oregon DOJ investigation is only complicating things for the small company. For all the details and the latest updated news you can check out the Coolest Cooler Kickstarter page, here.