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Virginia’s Price Gouging Statute Activated As Storm Batters the East

Tropical Storm Ida and coastal Nor'easter bring high water, power failures

November 12, 2009
Virginia Attorney General Bill Mims has announced that the state's Anti-Price Gouging Statute, which prohibits the charging of “unconscionable” prices for “necessary goods and services,” has been activated as the remnants and Tropical Storm Idea and a coastal Nor'easter bringing flooding and tidal surges along the Eastern Seaboard.

Storm surges and localized flooding were being reported up and down the East Coast, as far north as New Jersey and throughout the Gulf Coast and Southeastern regions. Oil companies raced back to the Gulf as Ida moved ashore and, in Mobile, Alabama, a new cruise ship -- the Carnival Fantasy -- arrived a day late for its maiden voyage to the Mexican coast.

In Virginia's Chesapeake Bay communities, many homeowners awoke this morning to find boat docks underwater and electrical service interrupted. There were no immediate reports of injuries.

Gov. Tim Kaine declared a state of emergency in Virginia last night. By law, Virginia’s price-gouging statute goes into effect upon the issuance of a declared state of emergency by the Governor.

The Virginia Post-Disaster Anti-Price Gouging Act, which became law July 1, 2004, prohibits the charging of "unconscionable" prices for "necessary goods and services" in the affected areas within Virginia for the 30-day period following the disaster that resulted in the declared state of emergency.

The basic test under the statute is whether the price charged for the goods or services "grossly exceeds" the price charged within 10 days before the disaster. "Necessary goods and services" includes those goods or services for which demand does, or is likely to, increase as a result of the disaster.

The Attorney General’s Office has reached seven legal settlements with gas stations over price gouging after a state of emergency was declared Sept. 10, 2008 as Hurricane Ike approached the Gulf Coast.

“Virginia’s Post-Disaster Anti-Price Gouging Act leaves room for standard market forces to work in times of disaster and prohibits only the charging of unconscionable prices for necessary goods and services during these rare times,” Attorney General Mims said. “Hopefully Virginia retailers will be aware of this law’s current activation, and keep it in mind as they proceed with business during this flooding and storming. We intend to enforce our statute, as our record of law suits and settlements demonstrates. We will continue to do so in a reasonable and fair manner.”

Anyone who suspects price gouging should report it to the Office of Consumer Affairs -- 804-786-2042

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