Ending Price-Gouging During Emergencies Act

II 116TH CONGRESS 2D SESSION S. 3574 To protect consumers from price-gouging during emergencies. IN THE SENATE OF THE UNITED STATES MARCH 24, 2020 Mr. TILLIS introduced the following bill; which was read twice and referred to the Committee on Homeland Security and Governmental Affairs A BILL To protect consumers from price-gouging during emergencies. Be it enacted by the Senate and House of Representa- 1 tives of the United States of America in Congress assembled, 2 SECTION 1. SHORT TITLE. 3 This Act may be cited as the ‘‘Ending Price-Gouging 4 During Emergencies Act’’. 5 SEC. 2. PROHIBITION OF UNCONSCIONABLY EXCESSIVE 6 PRICING OF NECESSARY GOODS AND SERV- 7 ICES DURING EMERGENCIES. 8 (a) UNCONSCIONABLE PRICING.— 9 (1) IN GENERAL.—It shall be unlawful for any 10 person to sell, at wholesale or at retail in an emer- 11 gency area and during an emergency period, any 12 VerDate Sep 11 2014 03:57 Apr 04, 2020 Jkt 099200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6201 E:\BILLS\S3574.IS S3574 kjohnson on DSK79L0C42PROD with BILLS 2 •S 3574 IS good or service covered by a proclamation issued by 1 the Administrator of the Federal Emergency Man- 2 agement Agency (in this section referred to as the 3 ‘‘Administrator’’) under paragraph (2) at a price 4 that— 5 (A) is unconscionably excessive; and 6 (B) indicates the seller is taking unfair ad- 7 vantage of the circumstances related to the 8 emergency to increase prices unreasonably. 9 (2) NECESSARY GOODS AND SERVICES PROCLA- 10 MATION.— 11 (A) IN GENERAL.—The Administrator may 12 issue a proclamation with respect to an emer- 13 gency area during an emergency period to des- 14 ignate the goods and services to which the pro- 15 hibition described in paragraph (1) shall apply. 16 (B) CONTENT OF PROCLAMATION.—A 17 proclamation issued under this paragraph shall 18 include the following: 19 (i) The geographic area covered by 20 the proclamation. 21 (ii) The time period that such procla- 22 mation shall be in effect. 23 (iii) The specific goods and services or 24 categories of goods and services that are 25 VerDate Sep 11 2014 03:57 Apr 04, 2020 Jkt 099200 PO 00000 Frm 00002 Fmt 6652 Sfmt 6201 E:\BILLS\S3574.IS S3574 kjohnson on DSK79L0C42PROD with BILLS 3 •S 3574 IS subject to the prohibition described in 1 paragraph (1). 2 (C) DURATION.—The proclamation may 3 not apply for a period of more than 30 consecu- 4 tive days, but may be renewed for such consecu- 5 tive periods, each not to exceed 30 days, as the 6 Administrator determines appropriate. 7 (D) AUTHORITY TO ISSUE MULTIPLE 8 PROCLAMATIONS.—The Administrator may 9 issue multiple proclamations under this para- 10 graph with respect to an emergency area and 11 an emergency period, as necessary. 12 (3) FACTORS CONSIDERED.—In determining 13 whether a person has violated paragraph (1), there 14 shall be taken into account, among other factors— 15 (A) whether the amount charged by such 16 person for the applicable good or service at a 17 particular location in an area covered by a proc- 18 lamation issued under paragraph (2) during the 19 period such proclamation is in effect— 20 (i) grossly exceeds the average price 21 at which the applicable good or service was 22 offered for sale by that person during the 23 30 days prior to such proclamation; 24 VerDate Sep 11 2014 03:57 Apr 04, 2020 Jkt 099200 PO 00000 Frm 00003 Fmt 6652 Sfmt 6201 E:\BILLS\S3574.IS S3574 kjohnson on DSK79L0C42PROD with BILLS 4 •S 3574 IS (ii) grossly exceeds the price at which 1 the same or similar good or service was 2 readily obtainable in the same area from 3 other competing sellers during the same 4 period; 5 (iii) reasonably reflected additional 6 costs, not within the control of that person, 7 that were paid, incurred, or reasonably an- 8 ticipated by that person, or reflected addi- 9 tional risks taken by that person to 10 produce, distribute, obtain, or sell such 11 good or service under the circumstances; 12 and 13 (iv) was substantially attributable to 14 local, regional, national, or international 15 market conditions; and 16 (B) whether the quantity of the good or 17 service the person produced, distributed, or sold 18 in an area covered by a proclamation issued 19 under paragraph (2) during a 30-day period fol- 20 lowing the issuance of such proclamation in- 21 creased over the quantity that such person pro- 22 duced, distributed, or sold during the 30 days 23 prior to such proclamation, taking into account 24 usual seasonal demand variations. 25 VerDate Sep 11 2014 03:57 Apr 04, 2020 Jkt 099200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6201 E:\BILLS\S3574.IS S3574 kjohnson on DSK79L0C42PROD with BILLS 5 •S 3574 IS (b) DEFINITION OF EMERGENCY AREA AND PE- 1 RIOD.—In this section, an ‘‘emergency area’’ is a geo- 2 graphical area in which, and an ‘‘emergency period’’ is the 3 period during which, there exists an emergency or disaster 4 declared by the President pursuant to the National Emer- 5 gencies Act or the Robert T. Stafford Disaster Relief and 6 Emergency Assistance Act. 7 (c) EFFECTIVE DATE.—This section shall take effect 8 on the date of enactment of this Act and shall apply to 9 any emergency or disaster declaration described in sub- 10 section (b) that is in effect on such date or made on or 11 after such date. 12 SEC. 3. ENFORCEMENT BY THE FEDERAL TRADE COMMIS- 13 SION. 14 (a) ENFORCEMENT BY FTC.—A violation of section 15 2 shall be treated as a violation of a rule defining an un- 16 fair or deceptive act or practice prescribed under section 17 18(a)(1)(B) of the Federal Trade Commission Act (15 18 U.S.C. 57a(a)(1)(B)). The Federal Trade Commission 19 shall enforce this Act in the same manner, by the same 20 means, and with the same jurisdiction as though all appli- 21 cable terms and provisions of the Federal Trade Commis- 22 sion Act were incorporated into and made a part of this 23 Act. In enforcing section 2 of this Act, the Commission 24 shall give priority to enforcement actions involving in- 25 VerDate Sep 11 2014 03:57 Apr 04, 2020 Jkt 099200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S3574.IS S3574 kjohnson on DSK79L0C42PROD with BILLS 6 •S 3574 IS stances of a good or service being sold at an unconscion- 1 ably excessive price during an emergency period with the 2 highest percentage increase in price over the price for such 3 good or service as of the second week preceding such pe- 4 riod. 5 (b) CIVIL PENALTIES.— 6 (1) IN GENERAL.—Notwithstanding the pen- 7 alties set forth under the Federal Trade Commission 8 Act, any person who violates section 2 with actual 9 knowledge or knowledge fairly implied on the basis 10 of objective circumstances shall be subject to— 11 (A) a civil penalty of not more than 10 12 times the amount of profits gained by such per- 13 son through such violation; or 14 (B) a civil penalty of not more than 15 $100,000,000. 16 (2) METHOD.—The penalties provided by para- 17 graph (1) shall be obtained in the same manner as 18 civil penalties obtained under section 5 of the Fed- 19 eral Trade Commission Act (15 U.S.C. 45). 20 (3) MULTIPLE OFFENSES; MITIGATING FAC- 21 TORS.—In assessing the penalty provided by sub- 22 section (a)— 23 (A) each day of a continuing violation shall 24 be considered a separate violation; and 25 VerDate Sep 11 2014 03:57 Apr 04, 2020 Jkt 099200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\S3574.IS S3574 kjohnson on DSK79L0C42PROD with BILLS 7 •S 3574 IS (B) the court shall take into consideration, 1 among other factors, the seriousness of the vio- 2 lation and the efforts of the person committing 3 the violation to remedy the harm caused by the 4 violation in a timely manner. 5 SEC. 4. CRIMINAL PENALTIES. 6 (a) IN GENERAL.—In addition to any penalty appli- 7 cable under section 3, any person who violates section 2 8 shall be fined under title 18, United States Code, in an 9 amount not to exceed $500,000,000. 10 (b) ENFORCEMENT.—The criminal penalty provided 11 by subsection (a) may be imposed only pursuant to a 12 criminal action brought by the Attorney General or other 13 officer of the Department of Justice. The Attorney Gen- 14 eral shall give priority to enforcement actions involving in- 15 stances of a good or service being sold at an unconscion- 16 ably excessive price during an emergency period with the 17 highest percentage increase in price over the price for such 18 good or service as of the second week preceding such pe- 19 riod. 20 SEC. 5. ENFORCEMENT AT RETAIL LEVEL BY STATE ATTOR- 21 NEYS GENERAL. 22 (a) IN GENERAL.—A State, as parens patriae, may 23 bring a civil action on behalf of its residents in an appro- 24 priate district court of the United States to enforce the 25 VerDate Sep 11 2014 03:57 Apr 04, 2020 Jkt 099200 PO 00000 Frm 00007 Fmt 6652 Sfmt 6201 E:\BILLS\S3574.IS S3574 kjohnson on DSK79L0C42PROD with BILLS 8 •S 3574 IS provisions of section 2 of this Act, or to impose the civil 1 penalties authorized by section 3(b)(1)(B), whenever the 2 attorney general of the State has reason to believe that 3 the interests of the residents of the State have been or 4 are being threatened or adversely affected by a violation 5 of this Act or a regulation under this Act, involving a re- 6 tail sale. 7 (b) NOTICE.—The State shall serve written notice to 8 the Federal Trade Commission of any civil action under 9 subsection (a) prior to initiating such civil action. The no- 10 tice shall include a copy of the complaint to be filed to 11 initiate such civil action, except that if it is not feasible 12 for the State to provide such prior notice, the State shall 13 provide such notice immediately upon instituting such civil 14 action. 15 (c) AUTHORITY TO INTERVENE.—Upon receiving the 16 notice required by subsection (b), the Federal Trade Com- 17 mission may intervene in such civil action and upon inter- 18 vening— 19 (1) be heard on all matters arising in such civil 20 action; and 21 (2) file petitions for appeal of a decision in such 22 civil action. 23 (d) CONSTRUCTION.—For purposes of bringing any 24 civil action under subsection (a), nothing in this section 25 VerDate Sep 11 2014 03:57 Apr 04, 2020 Jkt 099200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\S3574.IS S3574 kjohnson on DSK79L0C42PROD with BILLS 9 •S 3574 IS shall prevent the attorney general of a State from exer- 1 cising the powers conferred on the attorney general by the 2 laws of such State to conduct investigations or to admin- 3 ister oaths or affirmations or to compel the attendance 4 of witnesses or the production of documentary and other 5 evidence. 6 (e) VENUE; SERVICE OF PROCESS.—In a civil action 7 brought under subsection (a)— 8 (1) the venue shall be a judicial district in 9 which— 10 (A) the defendant operates; 11 (B) the defendant was authorized to do 12 business; or 13 (C) the defendant in the civil action is 14 found; 15 (2) process may be served without regard to the 16 territorial limits of the district or of the State in 17 which the civil action is instituted; and 18 (3) a person who participated with the defend- 19 ant in an alleged violation that is being litigated in 20 the civil action may be joined in the civil action with- 21 out regard to the residence of the person. 22 (f) LIMITATION ON STATE ACTION WHILE FEDERAL 23 ACTION IS PENDING.—If the Federal Trade Commission 24 has instituted a civil action or an administrative action 25 VerDate Sep 11 2014 03:57 Apr 04, 2020 Jkt 099200 PO 00000 Frm 00009 Fmt 6652 Sfmt 6201 E:\BILLS\S3574.IS S3574 kjohnson on DSK79L0C42PROD with BILLS 10 •S 3574 IS for violation of this Act, no State attorney general, or offi- 1 cial or agency of a State, may bring an action under this 2 subsection during the pendency of that action against any 3 defendant named in the complaint of the Federal Trade 4 Commission or the other agency for any violation of this 5 Act alleged in the complaint. 6 (g) ENFORCEMENT OF STATE LAW.—Nothing con- 7 tained in this section shall prohibit an authorized State 8 official from proceeding in State court to enforce a civil 9 or criminal statute of such State. 10 SEC. 6. EFFECT ON OTHER LAWS. 11 (a) OTHER AUTHORITY OF FEDERAL TRADE COM- 12 MISSION.—Nothing in this Act shall be construed to limit 13 or affect in any way the Federal Trade Commission’s au- 14 thority to bring enforcement actions or take any other 15 measure under the Federal Trade Commission Act (15 16 U.S.C. 41 et seq.) or any other provision of law. 17 (b) STATE LAW.—Nothing in this Act preempts any 18 State law. 19 Æ VerDate Sep 11 2014 03:57 Apr 04, 2020 Jkt 099200 PO 00000 Frm 00010 Fmt 6652 Sfmt 6301 E:\BILLS\S3574.IS S3574 kjohnson on DSK79L0C42PROD with BILLS