Price Gouging Prohibited During the COVID-19 Peacetime Emergency

03/20/2020

On March 20, 2020, Minnesota Governor Tim Walz signed Executive Order 20-10 prohibiting the sale of essential consumer goods and services within the state for an unconscionably excessive price.

E.O. 20-10 defines “essential consumer goods and services” as goods or services vital and necessary for the health, safety, and welfare of the public, including without limitation: food, water, fuel, gasoline, housing, shelter, transportation, health care goods and services, pharmaceuticals, medical supplies, and personal hygiene, sanitation, and cleaning goods.

An essential good or service can be deemed to be “unconscionably excessive” in the following ways:

  • There is a gross disparity between the price of a good or service during the peacetime emergency and the price during the 30 days immediately prior to March 13, 2020;

  • The amount charged for the good or service is more than 20% higher than it was offered in the normal course of business during the 30 days immediately prior to March 13, 2020; or

  • The amount charged grossly exceeds the price at which the same or similar good or service is readily obtainable by other purchasers in the area.

It is not considered price gouging of the price increase is substantially attributable to significant additional costs outside the control of the person.

Enforcement for willful violation may include:

  • Fine not to exceed $10,000 per sale or transaction;

  • Injunctive Relief; and

  • Private civil actions by individuals injured by price gouging.

Duration:

  • Termination of peacetime emergency (Executive Order 20-01); or

  • Rescission of the order itself. 

Key Issues to Consider 

In the face of a global pandemic, Minnesota citizens have reported numerous instances of price gouging throughout the state, including concerns of excessive pricing on hygiene supplies, cleaning products, personal protective equipment, food, and other essential consumer goods and services. Following the issuing of E.O. 20-10, Minnesota businesses should make every effort to maintain pricing on their goods and services in a manner that is relatively consistent with the 30 days prior to March 13, 2020, the date of the Governor’s declaration of a peacetime emergency.

We Can Help

Every individual and company is managing issues arising from COVID-19. The Larkin Hoffman Government Relations team is engaged daily with key state government decision makers to gain assistance and remove barriers critical to our clients ongoing operations, and perhaps even their survival. We are available to assist you on issues ranging from influencing the governor’s Executive Orders to requesting waivers from state government requirements to revising legislative proposals that will become law.