Price Gouging and Police Powers in Declared Emergencies

Litigation partner Jeff Jacobson will speak at a teleforum hosted by New Jersey Civil Justice Institute on Thursday, April 2 at 12:00 p.m. eastern. With the invocation of emergency powers by New Jersey Governor Murphy, businesses and individuals alike are facing a variety of new requirements and restrictions, but it is not always clear what is required for compliance.

Laws that protect against “price-gouging” during declared emergencies, for example, were designed with short, regional emergencies in mind. These laws protect against suppliers increasing prices for food and household staples already in their inventories, but they allow suppliers to increase prices to reflect increased costs brought about by the emergency. If the COVID-19 emergency persists for weeks or months, what increased costs will the law allow suppliers to pass on lawfully to their customers? Must suppliers continue to charge their March 9 prices even for products that normally would see increased prices in the warmer months? There are no easy answers to these questions because, until now, we have not faced a national, long-term emergency while anti-gouging laws have been in effect, and enforcement authorities have not yet given guidance, beyond stern warnings against “gouging,” as to how they will construe the laws in the weeks and months to come.

Please email Tara at the NJCJI for call-in details.