New York AG James Combats Price Gouging

  • New York AG Letitia James issued an Advance Notice of Proposed Rulemaking to solicit comments, information, and data that will assist the AG in creating regulations preventing price gouging under New York General Business Law § 396-r.  The press release announcing the ANPRM noted that “[t]he rulemaking process will explore growing evidence that big corporations appear to have used the [COVID] pandemic as an excuse to charge more for necessary goods, such as gas and oil, food, and cars.”
  • New York General Business Law § 396-r prohibits any entity in the supply chain from taking advantage of an “abnormal disruption of the market” to sell vital goods and services for an “unconscionably excessive price.”  The ANPRM identifies industries whose sharp price increases during the pandemic could be considered price gouging, including the beef industry and the shipping industry, as well at-home COVID-19 tests, and explains that, in each of these instances, the price increases could not be explained by supply chain disruption and inflation alone.
  • The AMPRM invites the public to provide comments by April 15, 2022, on 28 questions on topics ranging from the general nature of price gouging, to recommended thresholds for “unconscionably extreme” pricing, and the definitions of the statutory terms “unfair leverage” and “unconscionable means,” as well as industry-specific questions relating to pandemic price increases in industries such as energy production and distribution.