Bill Text: NY A00237 | 2019-2020 | General Assembly | Introduced
Bill Title: Relates to price gouging; defines unconscionably excessive price for the purposes of prohibiting price gouging during abnormal disruption of the market.
Spectrum: Partisan Bill (Democrat 6-0)
Status: (Introduced - Dead) 2020-01-08 - referred to consumer affairs and protection [A00237 Detail]
Download: New_York-2019-A00237-Introduced.html
STATE OF NEW YORK ________________________________________________________________________ 237 2019-2020 Regular Sessions IN ASSEMBLY (Prefiled) January 9, 2019 ___________ Introduced by M. of A. BRAUNSTEIN, THIELE, HEVESI, GUNTHER, M. G. MILL- ER, STIRPE -- read once and referred to the Committee on Consumer Affairs and Protection AN ACT to amend the general business law, in relation to price gouging The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Section 396-r of the general business law, as amended by 2 chapter 510 of the laws of 1998, subdivision 4 as amended by chapter 224 3 of the laws of 2008, is amended to read as follows: 4 § 396-r. Price gouging. 1. Legislative findings and declaration. The 5 legislature hereby finds that during periods of abnormal disruption of 6 the market caused by strikes, power failures, severe shortages or other 7 extraordinary adverse circumstances, some parties within the chain of 8 distribution of consumer goods have taken unfair advantage of consumers 9 by charging grossly excessive prices for essential consumer goods and 10 services. 11 In order to prevent any party within the chain of distribution of any 12 consumer goods from taking unfair advantage of consumers during abnormal 13 disruptions of the market, the legislature declares that the public 14 interest requires that such conduct be prohibited and made subject to 15 civil penalties. 16 2. During any abnormal disruption of the market for consumer goods and 17 services vital and necessary for the health, safety and welfare of 18 consumers, no party within the chain of distribution of such consumer 19 goods or services or both shall sell or offer to sell any such goods or 20 services or both for an amount which represents an unconscionably exces- 21 sive price. For purposes of this section, the phrase "abnormal 22 disruption of the market" shall mean any change in the market, whether 23 actual or imminently threatened, resulting from stress of weather, 24 convulsion of nature, failure or shortage of electric power or other EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD02659-01-9A. 237 2 1 source of energy, strike, civil disorder, war, military action, national 2 or local emergency, or other cause of an abnormal disruption of the 3 market [which], where such abnormal disruption results in the declara- 4 tion of a state of emergency by the governor. For the purposes of this 5 section, the term consumer goods and services shall mean those used, 6 bought or rendered primarily for personal, family or household purposes. 7 This prohibition shall apply to all parties within the chain of distrib- 8 ution, including any manufacturer, supplier, wholesaler, distributor or 9 retail seller of consumer goods or services or both sold by one party to 10 another when the product sold was located in the state prior to the 11 sale. Consumer goods and services shall also include any repairs made by 12 any party within the chain of distribution of consumer goods on an emer- 13 gency basis as a result of such abnormal disruption of the market. 14 3. [Whether a price is unconscionably excessive is a question of law15for the court.16(a) The court's determination that a violation of this section has17occurred shall be based on any of the following factors: (i) that the18amount of the excess in price is unconscionably extreme; or (ii) that19there was an exercise of unfair leverage or unconscionable means; or20(iii) a combination of both factors in subparagraphs (i) and (ii) of21this paragraph.22(b) In any proceeding commenced pursuant to subdivision four of this23section, prima facie proof that a violation of this section has occurred24shall include evidence that25(i) the amount charged represents a gross disparity between the price26of the goods or services which were the subject of the transaction and27their value measured by the price at which such consumer goods or28services were sold or offered for sale by the defendant in the usual29course of business immediately prior to the onset of the abnormal30disruption of the market or31(ii) the amount charged grossly exceeded the price at which the same32or similar goods or services were readily obtainable by other consumers33in the trade area.] 34 (a) A price is not an "unconscionably excessive price" if any one of 35 the following applies: 36 (i) it is ten percent or less above the seller's price for that prod- 37 uct immediately prior to the declaration of the state of emergency by 38 the governor; 39 (ii) it is ten percent or less above current prices for that product 40 in any area outside the geographic scope of the declaration of the state 41 of emergency or an adjoining state, tax-adjusted; 42 (iii) it is ten percent or less above the sum of the seller's: (A) 43 acquisition or replacement cost, whichever is higher; plus (B) the mark- 44 up customarily applied by the seller in the usual course of business 45 immediately prior to the declaration of the state of emergency by the 46 governor; 47 (iv) it is attributable to fluctuations in applicable regional or 48 national spot or commodity markets; or 49 (v) it is a contract price or price formula agreed to prior to the 50 declaration of the state of emergency by the governor. 51 (b) A defendant may rebut a prima facie case with evidence that addi- 52 tional costs not within the control of the defendant were imposed on the 53 defendant for the goods or services. 54 4. Where a violation of this section is alleged to have occurred, the 55 attorney general may apply in the name of the People of the State of New 56 York to the supreme court of the State of New York within the judicialA. 237 3 1 district in which such violations are alleged to have occurred, on 2 notice of five days, for an order enjoining or restraining commission or 3 continuance of the alleged unlawful acts. In any such proceeding, the 4 court shall impose a civil penalty in an amount not to exceed twenty- 5 five thousand dollars and, where appropriate, order restitution to 6 aggrieved consumers. 7 § 2. This act shall take effect immediately.