Over a year ago, states of emergency were declared across the country. Such emergency declarations are often the trigger for state pricing restrictions. Tracking the start and end of the emergency declarations is essential for interpreting the pricing restrictions they impose. For instance, in Oklahoma, the pricing restrictions remain in place throughout the duration of the emergency, and extend for 30 days after the state of emergency has terminated.
Governors around the country continue to extend states of emergency. Emergency declarations continue to push out the expiration dates by increments of typically 30 to 60 days. But in some states, emergency declarations have expired.
In Alaska, California, and Oregon the full COVID-19 states of emergencies have expired. Yesterday, the Oregon Governor renewed the state of emergency, but lifted the executive order regarding price gouging, “because the days of hand sanitizer and, yes, toilet paper scarcity are far behind us.” She also signaled eventually lifting the COVID-related state of emergency entirely, but maintained flexibility depending on how the situation develops.
Similarly, the California Governor also took a nuanced approach and lifted the pricing restrictions for all but a few specific items. As we discussed in previous posts, price gouging restrictions are now limited to a smaller subset, including water, blankets, soaps, diapers, and toiletries. These restrictions are in place until September 4, 2021.
In Alaska, the state of emergency expired on February 14, 2021. With its expiration, pricing restrictions have been relaxed. However, the two year statute of limitations for bringing a case remains. Accordingly, companies should continue to maintain records from the past year as cases alleging violations of the state price gouging prohibition potentially may be brought until February of 2023.
Most states continue to have price gouging restrictions in place. Governors are often extending states of emergency in 15, 21, 30, and 60 day increments. Currently, 13 states are set for emergency declarations to expire in May. For instance, on April 22, 2021, the South Carolina Governor extended the state of emergency for another 15 days. Florida also extended its state of emergency an additional 60 days to June 26, 2021.
Other states have longer running emergency periods. In Missouri the state of emergency declaration is set to expire on August 31, 2021. In Texas’ emergency will remain in effect until June 14, 2021, unless rescinded or renewed.
As the COVID situation continues to evolve, Governors may issue additional extensions, or they may quietly allow the emergency declarations to expire.
Additionally, states are looking to amend their price gouging statutes. As we previously noted, Idaho enacted new legislation. The legislation provides that only price increases are covered by the price gouging prohibition – not price decreases that are deemed insufficient. Additionally, the new legislation requires that when analyzing whether the price increase is “exorbitant or excessive,” courts “shall not consider any increase in the margin earned.” This legislation came following headlines detailing a settlement by the Idaho Attorney General with three gasoline retailers, in which the Attorney General alleged the retailers’ margin was too high, despite the fact that gas prices dropped.
As the COVID price restrictions enter a second year, states will continue to evaluate the necessity for states of emergency and price gouging restrictions.
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© 2021 Proskauer Rose LLP. National Law Review, Volume XI, Number 120
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