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Price Gouging Compliance Practice Tips: Conduct a Price Gouging Audit

Understanding and Reacting to New and Increased Risks

Businesses are facing new and increased risks as they work to continue operations and meet changing demand. The unprecedented duration and nationwide scope of the emergency has created additional complexities for companies that operate on a nationwide basis. They often must comply with price gouging laws in many more states and over a substantially longer period of time than has ever occurred in any prior emergency in which price gouging laws were activated.

The definition of price gouging varies significantly from state to state, and consequently, so do the compliance standards. Non-compliance could be met with hefty penalties, as most states charge per individual violation. State attorneys generalprivate plaintiffs, and the federal government have all been active in price gouging investigations and enforcement actions up and down the supply chain.

Because these price gouging compliance risks are both new and unique to this pandemic, companies cannot necessarily rely on their existing monitoring and risk mitigation systems (for price gouging or otherwise). Even those few companies that had price gouging compliance procedures in place before this pandemic may find that those procedures are out of date or incomplete due to recent changes in the law and changes in enforcement priorities. Given the increased risks to national and multi-state companies across the supply chain, companies should consider conducting what effectively amounts to a “Price Gouging Audit.”

Creating a Compliance Tracking Process

Companies should consider a review of their current policies and procedures to track and comply with the particular price gouging laws that affect their business. A Price Gouging Audit may include a range of steps, depending on a particular company’s facts and circumstances, and could include:

  • Identifying which goods and/or services may be subject to various price gouging laws and regulations;

  • Tracking sales and identifying the states in which a company may be deemed to do business for the purpose of the price gouging laws;

  • Determining which state or local regulations may apply;

  • Determining how to set a compliance baseline;

  • Evaluating current employee training processes to see if additional training on price gouging is necessary; and/or

  • Evaluating current price setting and documentation processes to see if changes should be made in light of price gouging laws.

Depending on the results of their review, a company may also want to take affirmative steps to create additional protocols for price gouging compliance. These steps could include:

  • Developing additional employee training processes to account for price gouging training;

  • Developing additional price setting and documentation processes to account for price gouging laws; and/or

  • Creating an overarching price gouging compliance monitoring team to help oversee the above processes.

Benefits of Conducting a Price Gouging Audit

Engaging in a Price Gouging Audit may help companies understand the unique risks and requirements of this moment, and enable them to create a single strategy to do business in multiple states while staying within the bounds of the multiple and varying state price gouging legal regimes to which they may be subject.

© 2020 Proskauer Rose LLP. National Law Review, Volume X, Number 183

TRENDING LEGAL ANALYSIS


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