Price gouging, the act of inflating prices excessively during emergencies, is more than just an unfair business practice—it’s illegal in California and many other states. This predatory behavior targets consumers at their most vulnerable moments, such as during natural disasters or public health crises. But why is price gouging illegal, and how does California law address it?
What Is Price Gouging?
Price gouging occurs when businesses exploit emergencies to charge exorbitant prices for essential goods and services. Items commonly affected include:
- Food and water
- Gasoline
- Medical supplies
- Temporary housing
This practice undermines trust and fairness in the marketplace, placing an undue burden on individuals who are already struggling.
Why Is Price Gouging Illegal?
The primary reason price gouging is illegal is to protect consumers from exploitation during times of crisis. In California, the law aims to:
- Ensure Access to Essentials: Preventing inflated prices helps ensure that necessities remain accessible to all.
- Promote Fairness: It maintains a level playing field, ensuring that no one profits excessively at the expense of others.
- Support Crisis Management: Price stability is crucial for effective emergency response efforts.
Under California’s Penal Code Section 396, price gouging is strictly prohibited during a declared state of emergency. Businesses cannot raise prices on essential goods and services by more than 10% unless justified by increased costs. Violators face steep penalties, including fines and potential imprisonment.
The Impact of Price Gouging
Price gouging disproportionately affects vulnerable populations, such as low-income families and the elderly. For example, during the COVID-19 pandemic, California saw numerous reports of exorbitantly priced hand sanitizers, masks, and other critical supplies. These practices sparked widespread public outrage and legal actions.
How to Report Price Gouging in California
If you suspect price gouging, California law empowers you to take action. You can report violations to the California Attorney General’s Office or local law enforcement. Gather evidence, such as receipts or photographs, to support your claim.
Why Legal Representation Matters
If you’ve been impacted by price gouging, consulting with an experienced attorney is essential. At the Joseph Saveri Law Firm, we specialize in antitrust and consumer protection cases, holding corporations accountable for illegal practices. We are committed to advocating for fairness and justice on behalf of Californians.
Fighting Against Exploitation
By understanding why price gouging is illegal and how to respond, you can help protect yourself and others during emergencies.
If you or someone you know has been affected by price gouging, please contact us. We’re dedicated to fighting for consumer rights and holding wrongdoers accountable.