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Volume X, Number 300

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Michigan Supreme Court Strikes Down Governor’s Emergency Powers

Are Michigan’s Enhanced Price Gouging Provisions Undone?

As much of the country remains under various and often overlapping states of emergency, one Governor’s powers have been limited by a state supreme court. On October 2, 2020, the Michigan Supreme Court held that Michigan Governor Gretchen Whitmer did not have authority to issue or renew COVID-related executive orders beyond April 30, 2020. The Court stated that “our decision today . . . leaves open many avenues for our Governor and Legislature to work together in a cooperative spirit and constitutional manner to respond to the COVID-19 pandemic.”

Governor Whitmer has faced immense backlash from those questioning her authority to extend Michigan’s coronavirus emergency declaration and issue COVID related executive orders. However the Governor has maintained that the Emergency Management Act of 1976 (EMA) and the Emergency Powers of the Governor Act of 1945 (EPGA) give her the authority to do so. In a sharp rebuke, the Michigan Supreme Court concluded that “the executive orders issued by the Governor in response to the COVID-19 pandemic now lack any basis under Michigan law.” In a written statement, Governor Whitmer stated she “vehemently disagree[s] with the court’s interpretation of the Michigan Constitution. Right now, every state and the federal government have some form of declared emergency. With this decision, Michigan will become the sole outlier . . . .”

Michigan’s Supreme Court ruling, the full effects of which are not yet known, may have an impact on the enhanced price gouging provisions the state had in place until June 12, 2020. On March 10, 2020, the same day that she declared a state of emergency, Governor Whitmer issued Executive Order 2020-08, putting enhanced restrictions on price gouging into effect. The enhanced price gouging provisions were extended by a series of executive orders through June 12, 2020. Under the enhanced provisions, “[a] person must not resell a product in this state at a price that is grossly in excess of the purchase price at which the person acquired the product.” The order further provided that “[a] person must not offer for sale or sell any product in this state at a price that is more than 20% higher than what the person offered or charged for that product as of March 9, 2020, unless the person demonstrates that the price increase is attributable to an increase in the cost of bringing the product to market or to an extraordinary discount in effect as of March 9, 2020.”

Given that the Court found that Governor Whitmer lacked authority to issue COVID related executive orders beyond April 30, 2020, the question arises whether the enhanced price gouging provisions also ceased on April 30, 2020. The Court’s ruling has no effect on the enhanced price gouging provisions that remained in place up until April 30, 2020. Nonetheless, Michigan consumers are not without protection. Under Michigan’s Consumer Protection Act, the state defines an unfair, unconscionable, or deceptive trade practice to include “[c]harging the consumer a price that is grossly in excess of the price at which similar property or services are sold.” Mich. Comp. Laws §445.903(z)

The limits of emergency powers have become a hot topic during the pandemic. As the pandemic continues, businesses need to stay current with respect to changes that may result from orders being challenged and rescinded.

© 2020 Proskauer Rose LLP. National Law Review, Volume X, Number 290
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About this Author

Christopher Ondeck, Antitrust Litigator, Proskauer Rose, law firm
Partner

Chris Ondeck is a partner in the Litigation Department and vice-chair of the Antitrust Group. He focuses his practice on representing clients in civil and criminal antitrust litigation, defending mergers and acquisitions before the U.S. antitrust agencies, defending companies involved in government investigations, and providing antitrust counseling.

Chris has handled antitrust matters for clients in a number of industries, including advertising, aerospace, alcoholic beverages, appliances, building materials, defense, medical devices, metals,...

202-416-5865
John Ingrassia, Antitrust Attorney, Telecommunications, Proskauer Law firm
Special Counsel

John Ingrassia is a special counsel and advises clients on a wide range of antitrust matters in various industries, including chemicals, pharmaceutical, medical devices, telecommunications, financial services, health care, and others. His practice includes a significant focus on the analysis of Hart-Scott-Rodino pre-merger notification requirements, the coordination and submission of Hart-Scott-Rodino filings, and the analysis and resolution of antitrust issues related to mergers, acquisitions, and joint ventures. John has extensive experience with the legal, practical, and technical requirements of the Hart-Scott-Rodino Act, and is regularly invited to participate in Federal Trade Commission and bar association discussions regarding Hart-Scott-Rodino practice issues. 

John also advises clients regarding international antitrust issues arising in proposed acquisitions and joint ventures, including reportability under the EC Merger Regulation and numerous other foreign competition filing regimes, and liaising with local counsel to coordinate foreign pre-merger notifications and ensure the efficacy and consistency of the competition law theories advanced.

202.416.6869
Kelly Landers Hawthorne, Proskauer Law Firm, New York, Litigation Attorney
Associate

Kelly Landers Hawthorne is an attorney in the Litigation Department.

Education

  • Columbia Law School, J.D., 2017

  • George Mason University, M.Ed., 2013

  • University of Richmond, B.A., 2011

212-969-3537
Law Clerk

Nathaniel Miller is a Law Clerk in the litigation department. He works for the firm's New York offices. 

Education

  • New York University School of Law, J.D., 2017
  • Harvard University, B.A., 2014
212-969-354
Nicollette R. Moser Litigation & Antitrust Proskauer Rose Washington, DC
Associate

Nicollette Moser is an associate in the Litigation Department and a member of the Antitrust Group.

Related Practices

  • Litigation
  • Antitrust

Admissions & Qualifications

  • District of Columbia
202.416.5862
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