AG Ellison lends support in court to states' authority to regulate price-gouging

September 24, 2020 (SAINT PAUL) — Minnesota Attorney General Keith Ellison today joined a bipartisan coalition of 30 states in filing an amicus brief in the U.S. Court of Appeals for the 6th Circuit in support of states’ authority to enforce price-gouging regulations to protect consumers during emergencies like the COVID-19 pandemic.

The bipartisan coalition is urging the appellate court to overturn the district court’s decision in Online Merchants Guild v. Cameron. The district court entered a preliminary injunction preventing Kentucky Attorney General Daniel Cameron from enforcing price-gouging regulations against retailers selling products on Amazon. In today’s brief, the coalition states that national and local emergencies like the pandemic create significant shortages for essential items. State laws and executive orders banning price-gouging are essential to ensuring that all people have fair access to goods they need to stay safe, and to preventing bad actors from profiting off people by charging excessively high prices for goods that are scarce.

Minnesota is one of only 14 states without a state law banning price-gouging. On March 20, 2020, Governor Tim Walz issued Executive Order 20-10, which bans price-gouging on essential goods for the duration of the COVID-19 peacetime emergency. The order gives enforcement authority to the Attorney General’s Office. Attorney General Ellison voted to ratify it as a member of the State Executive Committee. Since then, the Attorney General’s Office has received more than 2,200 complaints of pandemic profiteering through its COVID-19 price-gouging complaint form and has filed several enforcement actions to put a stop to it.

“Too many Minnesotans are struggling to afford their lives right now. It’s that much harder for them when bad actors try to profiteer off the pandemic, “Attorney General Ellison said. “I joined this amicus brief because it’s critical to defend Minnesota’s and all states’ ability to fight price-gouging wherever it happens so their residents can afford their lives and stay safe during the pandemic.

“I’m glad Governor Walz acted quickly to ban pandemic profiteering, but he shouldn’t have had to. He had to because Minnesota does not have a law on the books banning price-gouging, but we should. I hope now that the legislators of both parties have seen the effects that price-gouging has had on people in every corner of the state, they will act quickly to close the gap,” Attorney General Ellison added.

Background to amicus brief

During the COVID-19 pandemic, Minnesota and many states have implemented social-distancing measures in public places and recommended that residents stay home when possible. As a result, more consumers have turned to online sellers to purchase food, medicine, cleaning supplies, and other household essentials. On March 27, 2020, Attorney General Ellison joined another bipartisan coalition of 32 attorneys general in warning online retailers, including Amazon, that they were not exempt from their states’ legal restrictions on price-gouging.

The Online Merchants Guild, however, claiming that price-gouging laws should not be applied to retailers selling goods on Amazon, filed a lawsuit after the Kentucky Attorney General’s office began investigating several Kentucky-based retailers.

In today’s amicus brief, Attorney General Ellison and the bipartisan coalition emphasize that price-gouging laws level the playing field and ensure a more equitable distribution of goods to high- and low-income consumers. The attorneys general state that price-gouging protections have been particularly necessary during the pandemic, which has caused financial instability for millions of Americans and created and threatened shortages of essential goods. Furthermore, regulating price-gouging falls under states’ responsibility to aid vulnerable consumers during an emergency. Additionally, price-gouging laws and executive orders do not directly control the price of goods for out-of-state sales or create an actual conflict among state regulations.

The coalition is asking the appellate court to reverse the district court’s order granting injunctive relief.

Joining Attorney General Ellison in filing the amicus brief is Illinois Attorney General Kwame Raoul, who led the bipartisan coalition, and the attorneys general of Alaska, Arkansas, California, Colorado, Connecticut, Delaware, the District of Columbia, Hawaii, Idaho, Iowa, Kansas, Maine, Massachusetts, Michigan, Nevada, New Jersey, New York, North Carolina, Ohio, Oregon, Pennsylvania, Rhode Island, Tennessee, Texas, Vermont, Virginia, Washington, and Wisconsin. A copy of the brief is available on the website of Illinois Attorney General Raoul.