Price gouging law goes into effect following emergency declarations

Source: Wiki Commons
Source: Wiki Commons

Information from Louisiana Attorney General:

Attorney General Buddy Caldwell reminds citizens and businesses that Louisiana price gouging laws are in effect upon the state of emergency declaration by Gov. Bobby Jindal in anticipation of Tropical Storm Karen.

It's important to remember that not all price increases are considered price gouging. Price gouging occurs when a seller prices goods or services much higher than is reasonable under market conditions. The price gouging statute prohibits the raising of prices above the pre-emergency levels when there is no accompanying national or regional market commodity shortage.

This means that sellers of gasoline and petroleum products, hotels, motels, and retailers are prohibited from raising prices during this state of emergency unless they incur a verifiable increase in the price they have to pay as part of doing business. Product shortages, rig and refinery shutdowns, and global markets can all cause the price of goods and services to increase. These verifiable, market influenced cost increases may lawfully be passed on to the consumer. The price gouging laws carry both civil and criminal penalties.

This state of emergency extends from Thursday, Oct. 3 through Friday, Nov. 1, unless terminated sooner.  Suspected price gouging should be reported to local law enforcement officials, the district attorney, or the Louisiana Attorney General's Consumer Protection Hotline at 800-351-4889.

Frequently Asked Questions Regarding Price Gouging

Q. What is price gouging?

A. During a state of emergency, the prices charged or value received for goods and services
sold within the designated emergency area may not exceed the prices ordinarily charged for
comparable goods and services in the same market area at or immediately before the time of
the state of emergency, unless the price by the seller is attributable to fluctuations in
commodity markets, regional or national market trends, or to reasonable expenses, charges,
and risks incurred in procuring or selling the goods or services, La. R.S. 29:732(A). This
means that the price of gasoline, petroleum products, hotels, and motels are prohibited from
being raised during this state of emergency unless the price increase is directly related to a
rise in the cost of doing business.

Q. When does the price gouging ban go into effect?

A. The declaration of a state of emergency by the governor or by the parish president has
the effect of instituting Louisiana's prohibition against price gouging, La. R.S. 29:732(A).

Q. Once a state of emergency is declared, how long will the price gouging ban

A. This prohibition is effective during the period specified in the declaration and for an
additional period not to exceed 30 days after the declared state of emergency ends, unless
expressly extended by the governor. La. R.S. 29:732(B).

Q. How can I report price gouging?

A. If you suspect price gouging, please contact your local law enforcement officials, district
attorney, or the Louisiana Attorney General's Office. In order to help law enforcement
investigate your price gouging report, please include the following:
· Receipt(s). Please include the receipt for the purchase you believe you may have been
gouged, as well as any recent receipts from the same merchant. For example, if you
believe you have been gouged at the price pump, please try to include any recent
receipts from the same gas station so law enforcement can compare the price
· Location of the merchant.
· Date of the purchase.
· Cost of the goods or services.

Q. Does a ban on price gouging mean a seller cannot raise prices during an

A. No. The price gouging statute is not to freeze prices. Wholesalers and retailers may
increase prices as long as the increase in price charged by the seller is attributable to regional
or national market trends and fluctuations, or to reasonable expenses and charges for a
business' risk incurred in obtaining or selling the goods or services during the state of
emergency. La. R.S. 29:732(A).

Q. Is price gouging only for gasoline, or does it include other commodities?

A. The price gouging prohibition covers goods and services necessary for use as a direct
result of the state of emergency such as gasoline or diesel fuel of any grade, hotels, motels
and generators.

Q. What can happen if a person or business commits price gouging?

A. Upon a violation, the district attorney, parish attorney, or attorney general may bring
appropriate judicial action for an order enjoining or restraining commission or continuance
of the alleged unlawful acts. The court may impose a civil penalty and where appropriate,
order restitution for consumers. La. R.S. 29:734. In addition to the civil penalties available, a
willful violation of the price gouging statute is a criminal offense punishable by a fine up to
$500.00 or 6 months imprisonment, or both; imprisonment at hard labor for not more than
5 years where there is any serious bodily injury or any property damage in excess of
$5,000.00; and imprisonment at hard labor for not more than 21 years where a willful
violation results in the death of any person. La. R.S. 14:329.6 and La. R.S. 14:329.7(B) and