S T A T E O F N E W Y O R K
________________________________________________________________________
680
2023-2024 Regular Sessions
I N A S S E M B L Y
January 11, 2023
___________
Introduced by M. of A. DINOWITZ, COOK, SIMON, SEAWRIGHT -- Multi-Spon-
sored by -- M. of A. BRAUNSTEIN, GLICK, THIELE -- 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:
Section 1. Section 396-r of the general business law, as amended by
chapter 90 of the laws of 2020, is amended to read as follows:
§ 396-r. Price gouging. 1. Legislative findings and declaration. The
legislature hereby finds that during periods of abnormal disruption of
the market caused by strikes, power failures, severe shortages or other
extraordinary adverse circumstances, some parties within the chain of
distribution of goods have taken unfair advantage of the public by
charging grossly excessive prices for essential goods and services.
In order to prevent any party within the chain of distribution of any
goods from taking unfair advantage of the public during abnormal
disruptions of the market, the legislature declares that the public
interest requires that such conduct be prohibited and made subject to
civil AND CRIMINAL penalties.
2. During any abnormal disruption of the market for goods and services
vital and necessary for the health, safety and welfare of consumers or
the general public, no party within the chain of distribution of such
goods or services or both shall sell or offer to sell any such goods or
services or both for an amount which represents an unconscionably exces-
sive price. For purposes of this section, the phrase "abnormal
disruption of the market" shall mean any change in the market, whether
actual or imminently threatened, resulting from stress of weather,
convulsion of nature, failure or shortage of electric power or other
source of energy, strike, civil disorder, war, military action, national
or local emergency, or other cause of an abnormal disruption of the
market [which results in the declaration of a state of emergency by the
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD00614-01-3
A. 680 2
governor]. For the purposes of this section, the term goods and services
shall include (a) consumer goods and services used, bought or rendered
primarily for personal, family or household purposes, (b) essential
medical supplies and services used for the care, cure, mitigation,
treatment or prevention of any illness or disease, and (c) any other
essential goods and services used to promote the health or welfare of
the public. This prohibition shall apply to all parties within the chain
of distribution, including any manufacturer, supplier, wholesaler,
distributor or retail seller of goods or services or both sold by one
party to another when the product sold was located in the state prior to
the sale. Goods and services shall also include any repairs made by any
party within the chain of distribution of goods on an emergency basis as
a result of such abnormal disruption of the market.
3. Whether a price is unconscionably excessive is a question of law
for the court.
(a) The court's determination that a violation of this section has
occurred shall be based on any of the following factors: (i) that the
amount of the excess in price is unconscionably extreme; or (ii) that
there was an exercise of unfair leverage or unconscionable means; or
(iii) a combination of both factors in subparagraphs (i) and (ii) of
this paragraph.
(b) In any proceeding commenced pursuant to subdivision four of this
section, prima facie proof that a violation of this section has occurred
shall include evidence that:
(i) the amount charged represents a gross disparity between the price
of the goods or services which were the subject of the transaction and
their value measured by the price at which such goods or services were
sold or offered for sale by the defendant in the usual course of busi-
ness immediately prior to the onset of the abnormal disruption of the
market; or
(ii) the amount charged grossly exceeded the price at which the same
or similar goods or services were readily obtainable in the trade area.
(c) A defendant may rebut a prima facie case with evidence that (1)
the increase in the amount charged preserves the margin of profit that
the defendant received for the same goods or services prior to the
abnormal disruption of the market or (2) additional costs not within the
control of the defendant were imposed on the defendant for the goods or
services.
4. ANY PERSON WHO VIOLATES THE PROVISIONS OF THIS SECTION SHALL BE
GUILTY OF A VIOLATION.
5. Where a violation of this section is alleged to have occurred, A
DISTRICT ATTORNEY MAY FILE AN ACCUSATORY INSTRUMENT WITH A CRIMINAL
COURT WITHIN THE JUDICIAL DISTRICT IN WHICH SUCH VIOLATIONS ARE ALLEGED
TO HAVE OCCURRED, AND the attorney general may apply in the name of the
People of the State of New York to the supreme court of the State of New
York within the judicial district in which such violations are alleged
to have occurred, on notice of five days, for an order enjoining or
restraining commission or continuance of the alleged unlawful acts. In
any such proceeding, the court shall impose a civil penalty in an amount
not to exceed twenty-five thousand dollars per violation or three times
the gross receipts for the relevant goods or services, whichever is
greater and, where appropriate, order restitution to aggrieved parties.
[5.] 6. The attorney general may promulgate such rules and regulations
as are necessary to effectuate and enforce the provisions of this
section.
§ 2. This act shall take effect immediately.