The New York City Department of Consumer Affairs recently adopted a permanent rule declaring as unconscionable price gouging of goods and services that are essential essential to health, safety and welfare, or are marketed or advertised as being essential to health, safety and welfare during a declared State of Emergency in the City of New York. The rule includes an illustrative list of goods that are essential to health, safety or welfare, including but not limited to, staple consumer food items such as milk, eggs and bread, goods or services used for emergency cleanup, or emergency supplies such as water, flashlights, radios, batteries, candles, blankets, soaps, diapers, toiletries, medical supplies such as medications, bandages, gauze, isopropyl alcohol, medical masks, antibacterial products, and gasoline or other motor fuels. The rule also establishes a threshold for prohibited pricing of ten percent above the price at which consumers in New York City could obtain such goods or services 30 to 60 days prior to the declaration of a State of Emergency in the City of New York.
The permanent rule provides a defense if the merchant can show that the price increase was directly attributable to additional costs imposed on it by the supplier of the goods, or directly attributable to additional costs for labor or materials used to provide the services. The permanent rule further provides an exemption for merchants who did not exploit the State of Emergency and charged the same price both 30 days prior to the declaration of a State of Emergency and during that State of Emergency.
For an excellent analysis of U.S. and global price gouging laws, check out this alert written by my colleagues John Feldman and Toam Rubinstein and this alert written by my colleagues, Ross MacKenzie, Michelle Mantine, Dora Wang and Max Suester.