Press Release: 2024-10-14

Warren, Lawmakers Renew Push for National Price Gouging Ban As Companies Reportedly Take Advantage of Consumers During Hurricanes Helene and Milton

 



“A federal price gouging law, enforced by the FTC, would help consumers, particularly during disasters like Hurricane Helene.”



Text of Letter (PDF)



Washington, D.C.  – United States Senator Elizabeth Warren (D-Mass.), along with Senator Bernie Sanders (I-Vt.) and Representatives Jan Schakowsky (D-Ill.), Hank Johnson (D-Ga.), Matt Cartwright (D-Pa.), Sheila Cherfilus-McCormick (D-Fla.), Rosa DeLauro (D-Conn.), Maxwell Frost (D-Fla.), Pramila Jayapal (D-Wash.),Darren Soto (D-Fla.), Mark Takano (D-Calif.), Paul Tonko (D-N.Y.), and Frederica Wilson (D-Fla.) wrote to Chair of the Federal Trade Commission, Lina Khan, on reports of widespread price gouging in states impacted by Hurricanes Helene and Milton and on the need for a federal price gouging ban to complement state-level efforts. 



On September 26, 2024, Hurricane Helene made landfall in the Florida Gulf Coast as a Category 4 storm.  The hurricane caused significant damage across the Southeast United States, particularly in Florida, Georgia, North Carolina, South Carolina, Tennessee, and Virginia, and the death toll is now over 200.  Since Hurricane Helene made landfall, hundreds of people have filed complaints regarding price gouging as a result of the storm. This could include skyrocketing costs for airline tickets, gas, or hotel rooms for families fleeing their homes. 



Over the past two weeks, offices of attorneys general in each of these states have reiterated that their state-specific price gouging laws are in effect  to protect consumers during what has become “one of the deadliest storms in American history.” The Department of Transportation, FTC, DOJ, and CFPB have also warned companies against price gouging.



Nearly 40 states have price gouging laws. However, price gouging laws differ across states with regard to the scope of prohibited activities, the time period when the restriction goes into effect, and the time periods for which price gougers can be investigated and held accountable. As a result, some consumers may be less protected based on which state they live in.



“A federal price gouging law would strengthen and standardize state-level efforts to combat price gouging,”wrote the lawmakers. “Furthermore, a federal price gouging law would help tackle difficulties that might arise if price gouging occurs by a supplier higher up in the supply chain or by a business operating in multiple states.”



Despite the widespread existence of state price gouging laws, limits on the jurisdiction of state attorneys general may allow larger distributors or companies further up the supply chain to escape liability. 



“The current regulatory system forces state attorneys general to focus on smaller retailers operating within their state, who often are themselves victims of price gouging from larger suppliers,” wrote the lawmakers. “Consumers would benefit from a federal price gouging ban that would allow the Federal Trade Commission (FTC) to help state attorneys general target large, multi-state entities that may be engaged in price gouging. 



The lawmakers are asking the FTC to respond to questions on the potential benefits of a federal ban on price gouging by October 23rd.



As a champion for American consumers and a secure and healthy economy, Senator Warren has engaged in oversight of corporations that unfairly exploit consumers. She has also been calling for more competition and stronger enforcement of antitrust laws to bring down prices for families: 




  • In October 2024, Senator Elizabeth Warren (D-Mass.) and Representative Madeleine Dean (D-Pa.) wroteto the CEOs of Coca-Cola, PepsiCo, and General Mills, pressing their executives on the companies’ pattern of profiteering off consumers, both through “shrinkflation” and dodging taxes on the profits they made from that price gouging.

  • In September 2024, U.S. Senators Elizabeth Warren (D-Mass.) and Ed Markey (D-Mass.), and Representative Seth Moulton (D-Mass.) demanded answers from 13 corporate landlords operating in Massachusetts as to whether they are using RealPage’s algorithm to raise rents for families.

  • In August 2024, Senators Elizabeth Warren (D-Mass.) and Bob Casey (D-Pa.) sent a letter to Rodney McMullen, chairman and CEO of Kroger, raising concerns about Kroger’s use of Electronic Shelving Labels (ESLs) to potentially surge grocery prices and exploit consumers.

  • In May 2024, while chairing a Senate Banking Subcommittee on Economic Policy hearing, Senator Warren (D-Mass.) called out giant corporations for hiking up food prices while raking in record profits, and urged action to promote competition and bring down costs.

  • In May 2024, Senator Warren and Rep. Jim McGovern led a group of lawmakers in a letter to President Joe Biden, urging the Biden administration to use its executive authority to take action to lower food prices. 

  • In May 2024, during a hearing of the U.S. Senate Committee on Banking, Housing, & Urban Affairs, Senator Warren called out food industry price gouging and urged action to combat unfair pricing practices.

  • In April 2024, Senator Warren (D-Mass.), Bob Casey (D-Penn.), and Ben Ray Luján (D-N.M.) wrote to DoorDash and UberEats, the two largest delivery platforms, calling out their use of hidden junk fees.

  • In March 2024, Senator Elizabeth Warren (D-Mass.) and Representative Mary Gay Scanlon (D-Penn.) led a group of 14 lawmakers in a letter to FTC Chair Lina Khan urging the agency to revive enforcement of the Robinson-Patman Act (RPA), a critical tool to promote fair competition in the food industry. 

  • In February 2024, Senator Warren joined Senator Bob Casey (D-Pa.) in introducing the Shrinkflation Prevention Act to crack down on corporations that deceive consumers by selling smaller sizes of their products without lowering prices.

  • In February 2024, Senators Warren, Baldwin, Casey, and U.S. Representative Jan Schakowsky (D-Ill.)reintroduced the Price Gouging Prevention Act of 2024, which would protect consumers and prohibit corporate price gouging by authorizing the FTC and state attorneys general to enforce a federal ban against grossly excessive price increases.

  • In December 2023, Senator Warren urged the FTC to block the Kroger-Albertsons merger, which would give the five largest food retail companies control of 55 percent of all grocery sales, allowing them to further control and ultimately raise consumer prices, while also reducing job competition, decreasing wages, and decreasing the bargaining power of organized labor.

  • In November 2023, Senator Warren called out TransDigm for its refusal to provide cost and pricing information needed to prevent price gouging of taxpayers and the Department of Defense.

  • In the past few years, Senator Warren has urged the Biden administration to closely scrutinize other potentially anticompetitive mergers that could lead to higher prices for consumers and accelerate industry consolidation. She has led letters about the proposed mergers of Frontier and Spirit airlines, JetBlue and Spirit Airlines, Sanderson-Wayne, WarnerMedia-Discovery, and Amazon-MGM.

  • In March 2022, Senator Warren introduced the Prohibiting Anticompetitive Mergers Act to help stomp out rampant industry consolidation that allows companies to raise consumer prices and mistreat workers. The bill would ban the biggest, most anticompetitive mergers and give the Department of Justice and Federal Trade Commission the authority to reject deals in the first instance without court orders and to break up harmful mergers.

  • In February 2022, at a hearing, Senator Warren called out corporations for abusing their market power to raise consumer prices and boost profits.

  • That same month, Senator Warren requested the Department of Justice to take aggressive action against corporations violating antitrust laws to hike prices for consumers.

  • In January 2022, Senator Warren questioned Federal Reserve nominee Lael Brainard about market concentration and price gouging driving inflation.

  • At a January 2022 hearing, Senator Warren pressed Fed Chair Jerome Powell on the role of corporate concentration in driving up prices for consumers during his renomination hearing to be Chair of the Board of Governors of the Federal Reserve System.

  • In a New York Times op-ed published in April 2020, Senator Warren urged Congress to focus on cracking down on price gouging in its ongoing effort to address the impact of the coronavirus pandemic.

  • In March 2020, Senator Warren joined her colleagues in urging the FTC to use its full authority to prevent abusive price gouging on consumer health products during the COVID-19 pandemic.