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S. 3576 (116th): Disaster and Emergency Pricing Abuse Prevention Act


The text of the bill below is as of Mar 24, 2020 (Introduced). The bill was not enacted into law.


II

116th CONGRESS

2d Session

S. 3576

IN THE SENATE OF THE UNITED STATES

March 24, 2020

(for herself, Mr. Blumenthal, Ms. Hirono, and Ms. Cortez Masto) introduced the following bill; which was read twice and referred to the Committee on Commerce, Science, and Transportation

A BILL

To clarify that the Federal Trade Commission Act prohibits excessive and unjustified price increases in the sale of certain products and services when an emergency or disaster results in abnormal disruptions of the market, and for other purposes.

1.

Short title

This Act may be cited as the Disaster and Emergency Pricing Abuse Prevention Act.

2.

Definitions

In this section:

(a)

Commission

The term Commission means the Federal Trade Commission.

(b)

Essential goods or services

The term essential goods or services means goods or services that may be used to preserve, protect, or sustain the health, safety, or welfare of members of the public from potential harms resulting from a natural disaster, a pandemic, or the circumstances giving rise to a state of emergency.

(c)

Natural disaster

The term natural disaster means a disaster, catastrophe, or emergency, including flood, fire, earthquake, storm, or other serious act of nature, which threatens the health, safety, or welfare of the public.

(d)

Person

The term person means an individual or entity, its directors, officers, employees, agents, representatives, successors, and assigns, including any entity the person controls, and the respective directors, officers, employees, agents, representatives, successors, and assigns of each.

(e)

State of emergency

The term state of emergency means any state of emergency or disaster declared by the President or by the government of any State or territory of the United States.

(f)

Unconscionably excessive price

The term unconscionably excessive price means a price that represents a gross disparity between the price of the essential good or service that is the subject of an offer or transaction during, or in anticipation of, a natural disaster, pandemic, or state of emergency and the average price at which such essential good or service was offered in the ordinary course of business prior to any public anticipation of a natural disaster, pandemic, or state of emergency.

3.

Federal Trade Commission enforcement against price gouging

(a)

Violation

Selling, or offering for sale, essential goods and services, in or affecting commerce, at an unconscionably excessive price during, or in anticipation of, a natural disaster, pandemic, or state of emergency, shall constitute an unfair or deceptive act or practice under section 5(a) of the Federal Trade Commission Act (15 U.S.C. 45(a)).

(b)

Civil action

(1)

In general

If the Commission has reason to believe that there has been a violation of section 5(a) of the Federal Trade Commission Act (15 U.S.C. 45(a)) under subsection (a) of this section, the Commission may commence a civil action to recover a civil penalty and seek other appropriate relief in a district court of the United States.

(2)

Presumption

In a civil action under paragraph (1), the price of an essential good or service shall be presumed to be an unconscionably excessive price if the price charged or offered by the defendant during, or in anticipation of, a natural disaster, pandemic, or state of emergency, exceeded by 20 percent the greater of—

(A)

the average price charged by the defendant for the essential good or service during the preceding 60 days before the public could reasonably have anticipated the natural disaster, pandemic, or state of emergency; or

(B)

the average price at which buyers could obtain such good or service or similar goods or services in the geographic area during the 60-day period before the date on which the public could reasonably have anticipated the natural disaster, pandemic, or state of emergency,

unless the price charged by the defendant is attributable to price increases in related input markets or to additional expenses not within the control of the defendant that increased the defendant’s costs to furnish the essential goods or services.
(3)

Civil penalty

In an action under paragraph (1), any person that has been found liable for a violation of section 5(a) of the Federal Trade Commission Act (15 U.S.C. 45(a)) under subsection (a) of this section shall be subject to a civil penalty of an amount no greater than $10,000 per violation.

(4)

Rule of construction

The civil penalty provided in this subsection is in addition to, and not in lieu of, any other remedies provided by Federal law, including injunctive relief under section 13(b) of the Federal Trade Commission Act (15 U.S.C. 53(b)). Nothing in this paragraph shall be construed to affect any authority of the Commission under any other provision of law.

4.

Price gouging hotline

The Commission shall establish a telephone hotline and an online portal dedicated solely to receiving price gouging complaints from the public, which shall be activated in anticipation of or during major disasters or states of emergency and shall remain operational until 120 days after the conclusion of such major disasters or states of emergency.

5.

No preemption of State law

Nothing in this Act preempts any State law.