S.K.S. Perry is a writer who put a novel, called Darkside, up on his website as a free online novel. He decided eventually to make a Kindle version because a number of his readers had expressed an interest in having one. When he did so, however, he found that someone was already selling a pirated Kindle version, without any permission. He contacted Amazon.com about it and...nothing has happened (by U.S. law they are supposed to take down the work immediately and verify the identity of the person who was selling it). You can read about his struggle to get Amazon.com even to acknowledge the problem on his LiveJournal. Amazon.com has a famously bad reputation (e.g., inconsistent on good days, outright useless on bad) when it comes to customer service in matters that can't be handled by automation; but this is an especially serious issue -- more than a mere mistake, they seem currently to be in violation of the law.
The free online version of Darkside, if you're interested in the book.
The Kindle version of Darkside -- the authorized version, that is, if you want to support the author. The handy thing here is that you can actually read the book first to see if you like it enough to download it to a Kindle.