Bill Text: NY S04094 | 2009-2010 | General Assembly | Introduced


Bill Title: Relates to price gouging; imposes criminal penalties for price gouging; removes language relating to the declaration of a state of emergency; increases civil penalty; authorizes a district attorney to enforce provisions.

Spectrum: Partisan Bill (Democrat 17-0)

Status: (Introduced - Dead) 2010-01-06 - REFERRED TO CONSUMER PROTECTION [S04094 Detail]

Download: New_York-2009-S04094-Introduced.html
                           S T A T E   O F   N E W   Y O R K
       ________________________________________________________________________
                                         4094
                              2009-2010 Regular Sessions
                                   I N  S E N A T E
                                     April 9, 2009
                                      ___________
       Introduced  by Sens. SCHNEIDERMAN, ADAMS, BRESLIN, DIAZ, DUANE, HASSELL-
         THOMPSON, KLEIN, KRUEGER, KRUGER, MONTGOMERY, PARKER, SAMPSON,  SERRA-
         NO,  STACHOWSKI, STAVISKY, THOMPSON, VALESKY -- read twice and ordered
         printed, and when printed to be committed to the Committee on Consumer
         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    S 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 AND CRIMINAL 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,
        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
                                                                  LBD11107-01-9
       S. 4094                             2
    1  convulsion  of  nature,  failure  or shortage of electric power or other
    2  source of energy, strike, civil disorder, war, military action, national
    3  or local emergency, or other cause of  an  abnormal  disruption  of  the
    4  market  [which results in the declaration of a state of emergency by the
    5  governor]. For the purposes of this section, the term consumer goods and
    6  services shall  mean  those  used,  bought  or  rendered  primarily  for
    7  personal,  family or household purposes. This prohibition shall apply to
    8  all parties within the chain of distribution, including any  manufactur-
    9  er, supplier, wholesaler, distributor or retail seller of consumer goods
   10  or  services  or both sold by one party to another when the product sold
   11  was located in the state prior to the sale. Consumer goods and  services
   12  shall  also  include  any  repairs made by any party within the chain of
   13  distribution of consumer goods on an emergency basis as a result of such
   14  abnormal disruption of the market.
   15    3. Whether a price is unconscionably excessive is a  question  of  law
   16  for the court.
   17    (a)  The  court's  determination  that a violation of this section has
   18  occurred shall be based on any of the following factors:  (i)  that  the
   19  amount  of  the  excess in price is unconscionably extreme; or (ii) that
   20  there was an exercise of unfair leverage  or  unconscionable  means;  or
   21  (iii)  a  combination  of  both factors in subparagraphs (i) and (ii) of
   22  this paragraph.
   23    (b) In any proceeding commenced pursuant to subdivision [four] FIVE of
   24  this section, prima facie proof that a violation  of  this  section  has
   25  occurred shall include evidence that
   26    (i)  the amount charged represents a gross disparity between the price
   27  of the goods or services which were the subject of the  transaction  and
   28  their  value  measured  by  the  price  at  which such consumer goods or
   29  services were sold or offered for sale by the  defendant  in  the  usual
   30  course  of  business  immediately  prior  to  the  onset of the abnormal
   31  disruption of the market or
   32    (ii) the amount charged grossly exceeded the price at which  the  same
   33  or  similar goods or services were readily obtainable by other consumers
   34  in the trade area. A  defendant  may  rebut  a  prima  facie  case  with
   35  evidence  that  additional costs not within the control of the defendant
   36  were imposed on the defendant for the goods or services.
   37    4.  ANY PERSON WHO VIOLATES THE PROVISIONS OF THIS  SECTION  SHALL  BE
   38  GUILTY OF A VIOLATION.
   39    5.  Where  a  violation of this section is alleged to have occurred, A
   40  DISTRICT ATTORNEY MAY FILE AN  ACCUSATORY  INSTRUMENT  WITH  A  CRIMINAL
   41  COURT  WITHIN THE JUDICIAL DISTRICT IN WHICH SUCH VIOLATIONS ARE ALLEGED
   42  TO HAVE OCCURRED, AND the attorney general may apply in the name of  the
   43  People of the State of New York to the supreme court of the State of New
   44  York  within  the judicial district in which such violations are alleged
   45  to have occurred, on notice of five days,  for  an  order  enjoining  or
   46  restraining  commission  or continuance of the alleged unlawful acts. In
   47  any such proceeding, the court shall impose a civil penalty in an amount
   48  not to exceed twenty-five thousand dollars and, where appropriate, order
   49  restitution to aggrieved consumers.
   50    S 2. This act shall take effect immediately.
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