Attorney General James’ Price Gouging Authority Strengthened After Governor Cuomo Signs New Bill Into Law

New Law Will Expand AG James’ Ability to Go After Price Gouging
Targeting NYS, Hospitals, and Small Businesses

NEW YORK – New York Attorney General Letitia James today applauded Governor Andrew Cuomo signing into law legislation that will substantially strengthen New York State’s price gouging statute to prevent excessive price increases on essential goods and services, as the state continues to battle the coronavirus disease (COVID-19). The new price gouging law — S.8189, sponsored by Senator Brad Hoylman (SD-27), and A.10270, sponsored by Assemblywoman Nily Rozic (AD-25) — expands protections against price gouging beyond consumer goods to include any products or services that are vital or necessary to the health, safety, and welfare of consumers or the general public, extending protection against price gouging beyond only consumers to small businesses, hospitals and other health care providers, and even the State of New York, as they purchase products or services for the benefit of the public. The law will also protect a broader scope of products and services — including medical supplies and equipment, such as ventilators — which are critically needed during the current public health crisis.

“New Yorkers can rest assured that our office will fight every day to ensure they are not taken advantage of during the coronavirus pandemic or any other emergency our state may face in the future,” said Attorney General James. “Since this pandemic began, we have received over 7,000 price gouging complaints related to COVID-19 and gone after the bad actors behind these unlawful acts, but today’s law will vastly expand our efforts to protect New Yorkers’ wallets, as well as the bottom lines of small businesses and taxpayer dollars. We are focused on protecting all New Yorkers now and in the future. We applaud Governor Cuomo for signing this bill into law, and Senator Hoylman and Assemblywoman Rozic for their support and partnership in passing this important legislation so that our office can continue its work protecting New Yorkers.”

“From the beginning of this pandemic we’ve seen too many instances of retailers taking advantage of this dire situation and charging exorbitant prices for critical medical supplies,” Governor Cuomo said. “By banning price gouging on personal protective equipment, we are helping to ensure our health care workers — who have been working tirelessly to save lives at great personal danger to themselves — and the public have access to these supplies, while holding these unscrupulous retailers accountable for attempting to capitalize on the fear of others.”

“Pandemic profiteers need to get the hell out of New York,” said Senator Hoylman. “It's outrageous that these lowlifes have tried to make a quick buck off of our state’s valiant efforts to save the lives of COVID-19 patients and protect frontline medical workers from infection, so I’m glad our bill, signed into law today, will significantly expand New York's price gouging statute to allow Attorney General Tish James to crack down on price gougers. I’m grateful to have worked with Attorney General James, Senate Majority Leader Andrea Stewart-Cousins, and Assembly Sponsor Nily Rozic to craft this bill. I applaud Governor Cuomo for signing our legislation today, and thank Consumer Reports, AARP, and NYPIRG for their support.”

“This legislation strengthens and expands the New York State price gouging statute after the COVID-19 pandemic exposed glaring flaws in the law,” said Assemblywoman Rozic. “This new law will ensure that New Yorkers have access to the products and care required without paying excessive and unreasonable prices. As we face new challenges to contain the pandemic, we must protect consumers when they are particularly vulnerable. I thank Governor Cuomo for signing this essential legislation into law and providing the Attorney General the tools to make certain that no one can prey on consumers’ fears and cause widespread panic during this health crisis.”

Since the beginning of the COVID-19 outbreak, consumers, small businesses, health care providers, and the state have all faced steep price increases for critical medical goods and other essential items, such as hand sanitizer, face masks, and disinfectant spray. New York hospitals have paid up to 15-times more than the normal price for gloves and masks, while the state estimates total coronavirus-related expenses will exceed $15 billion due to bidding competitions with other state governments and high prices from suppliers. Under the existing price gouging statute, the Office of the Attorney General (OAG) has been limited in its ability to take action on certain types of items not typically deemed consumer goods, such as medical supplies. The legislation signed into law today will allow the OAG to take action against those seeking to profit off the health and safety of the general public.

Attorney General James has been focused on protecting consumers and vulnerable communities since the onset of the pandemic. In response to more than 7,000 complaints of excessive prices, the OAG has issued more than 1,565 cease-and-desist orders to businesses that stand accused of violating the current law.

Separately, last month, Attorney General James filed a lawsuit against wholesale grocery distributor Quality King Distributors, Inc. for illegally increasing the company’s wholesale prices for the sale of Lysol disinfectant products to neighborhood grocery and discount stores in New York. Since the beginning of the COVID-19 crisis, Quality King allegedly gouged prices of more than 46,000 cans of Lysol, even though the company did not incur increased costs for the products. The stores purchasing Lysol products from Quality King then passed on those increased prices to customers, forcing them to pay far higher prices for Lysol products than they did before the pandemic. Consumers were charged as much as $16.99 for one can of Lysol, which was previously sold at a retail price range of $5.00 to $8.00.