New York State Attorney General Letitia James has filed a petition to compel Tyson Foods to comply with a subpoena in connection with ongoing price gouging investigations by the state.  New York’s price gouging statute imposes civil penalties on sellers of essential goods charging unconscionably excessive prices during an abnormal disruption of the market.  The subpoena requests information relating to prices, dates of sale, purchasers, costs, and profit margin for Tyson’s meat products sold in New York from December 1, 2019 through April 2022.

In the petition, the NY AG alleges that Tyson partially complied with the subpoena, but later refused to provide additional information on the grounds that the company’s sales in New York were interstate sales during the relevant period, and thus not covered by New York’s price gouging law.  Tyson appears to be relying on a Dormant Commerce Clause argument against the application of New York’s price gouging law, a topic covered in a previous post.

Despite any defenses Tyson may raise, or ultimately succeed on, the petition and ongoing investigation serves as a warning to businesses that price gouging compliance continues to remain an area of focus for government regulators and enforcement agencies even two-and-a-half years after the start of the COVID-19 pandemic.  New York previously lifted its COVID-19 State of Emergency over a year ago, on June 24, 2021, however, on December 26, 2021, the Governor declared a second State of Emergency in reaction to the emergence of new COVID-19 variants.  The second State of Emergency remains in place, triggering New York’s price gouging law.

As we have previously discussed, price gouging laws historically are designed to temporarily prevent local price increases in reaction to emergencies such as severe storms, wildfires, flooding, etc.  Many states, and the federal government, continue to have active states of emergency related to the pandemic, triggering many states’ price gouging laws.  As market factors such as inflation, fuel costs, and supply chain issues, force reputable businesses to raise prices on goods and services, law-abiding business face the challenging scenario of navigating price gouging laws while costs continue to rise – requiring a redoubling of compliance efforts

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Visit Proskauer on Price Gouging for antitrust insights on COVID-19.

Photo of John R. Ingrassia John R. Ingrassia

When competition or antitrust questions arise, John Ingrassia is sought out for his knowledge, reputation and credentials.

John is a recognized authority on Hart-Scott-Rodino antitrust merger review, and for more than 20 years has counselled businesses facing the most challenging antitrust issues and…

When competition or antitrust questions arise, John Ingrassia is sought out for his knowledge, reputation and credentials.

John is a recognized authority on Hart-Scott-Rodino antitrust merger review, and for more than 20 years has counselled businesses facing the most challenging antitrust issues and helped them stay out of the crosshairs — whether its distribution, pricing, channel management, mergers, acquisitions or joint ventures.

John is a senior counsel at the Firm, advising on the full range of antitrust matters in diverse industries, including chemicals, pharmaceutical, medical devices, telecommunications, financial services and health care, among others.  His practice focuses on the analysis and resolution of antitrust issues related to mergers, acquisitions, and joint ventures, and the analysis and assessment of pre-merger notification requirements. John has extensive experience with the legal, practical, and technical requirements of merger clearance and is regularly invited to participate in Federal Trade Commission and bar association meetings regarding Hart-Scott-Rodino practice issues.

Photo of Timothy E. Burroughs Timothy E. Burroughs

Tim Burroughs is an associate in the Litigation Department.

Tim earned his J.D. from Vanderbilt Law School, where he was the Executive Student Writing Editor for the Vanderbilt Journal of Transnational Law and Teaching Assistant for the legal writing program. While at Vanderbilt…

Tim Burroughs is an associate in the Litigation Department.

Tim earned his J.D. from Vanderbilt Law School, where he was the Executive Student Writing Editor for the Vanderbilt Journal of Transnational Law and Teaching Assistant for the legal writing program. While at Vanderbilt, Tim interned at the U.S. Attorney’s Office for the Southern District of New York and published his student note on international anti-money laundering regulation in the fine-art market.

Prior to law school, Tim taught elementary school in the Brownsville neighborhood of Brooklyn for three years as part of Teach for America.