While we understand the legislative interest in expanding the state’s anti-price gouging legislation, we must oppose this specific proposal. We are concerned that the increased and uncapped civil penalty provisions are too excessive for a bill with such subjective parameters.
New York’s price gouging statue is inherently subjective, allowing for Attorney General enforcement in cases of an alleged sale of goods or services during an emergency for “an unconscionably excessive price.”
Under current state law, civil penalties are limited to $25,000 and restitution to aggrieved consumers. Under this bill, the civil penalty is increased to $25,000 “per violation,” or three times the “gross receipts for the relevant goods or services,” whichever is greater.
We appreciate that the bill expands available defenses, if it can be shown that the price increase merely preserves the sellers’ profit margin.
However, the potential for significantly increased, uncapped civil penalties will give the Attorney General undo leverage to obtain settlements in cases where the targeted business believed it was acting within the law. Given the inherently subjective standard for bringing price gouging cases, we believe this proposal for uncapped treble damages is inappropriate.
We urge the legislature to protect consumers and businesses who are acting in good faith by amending S.8189 (Hoylman) / A.10270 (Rozic) before its passage to eliminate these unnecessary and damaging civil penalty provisions.