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Law360 (April 8, 2020, 5:17 PM EDT ) House lawmakers introduced a pair of bills Wednesday aimed at cracking down on excessive pricing, as senators asked the U.S. Department of Justice to better enforce a White House order targeting price gouging and hoarding of medical supplies during the coronavirus outbreak.
A group of four House Democrats led by Rep. Jan Schakowsky, D-Ill., introduced the COVID-19 Price Gouging Prevention Act, which would prohibit the excessive pricing of consumer goods and services during the emergency declared as a result of the pandemic.
A second bill, introduced on Wednesday by Rep. Emanuel Cleaver II, D-Mo., would extend similar protections to essential goods and services before, during and immediately following any "pandemic, natural disaster or state of emergency." Called the Disaster and Emergency Pricing Abuse Prevention Act, the bill was introduced in the Senate in March by Sen. Amy Klobuchar, D-Minn.
"We often try to hammer down on price gouging as it is ongoing during a catastrophe," Cleaver said in a statement Wednesday. "We need a law that protects consumers from predatory price gougers who pop up during times of turmoil, instead of playing whack-a-mole every time a crisis emerges."
Klobuchar, along with Sen. Chuck Grassley, R-Iowa, sent a letter to Attorney General William Barr on Tuesday asking for details about the Justice Department's efforts to enforce an executive order aimed at preventing price gouging and hoarding of needed medical supplies during the COVID-19 pandemic.
President Donald Trump issued the order on March 23, saying during a press briefing that day it would become a crime to stockpile such items or to sell them at excessive prices. The senators urged the DOJ in their letter Tuesday to vigorously enforce the order.
"As schools and businesses close and members of the public shelter in their homes to limit the spread of the virus, certain unscrupulous actors are taking advantage of the crisis to make money off of the suffering of others," the letter said. "Such practices not only impose unjustifiable costs on those who need these medical and health supplies, they also exacerbate existing supply shortages, threatening public health and safety."
The order invoked authority under the Defense Production Act to give the Secretary of Health and Human Services the ability to designate materials that need to be protected from hoarding or price gouging during the country's response to COVID-19. HHS Secretary Alex Azar issued a list of covered materials on March 25, including certain personal protective equipment, sanitation products, medications and ventilators.
On the day the executive order was issued, Barr said during the White House briefing that a national task force had been convened to address supply chain issues, including specifically hoarding and price gouging. He also said a prosecutor had been designated in each of the U.S. attorneys offices to take the lead and that investigations had already been commenced.
The letter from Grassley and Klobuchar says the DOJ has the ability to enforce the executive order through criminal prosecutions and said the department will have to cooperate with other agencies and enforcers for the order to be effective. The senators asked Barr to describe the DOJ's enforcement efforts so far as well as any planned investigations or prosecutions, and they asked for details about the resources allocated to the project.
The letter also asks about the DOJ's coordination with HHS, the Federal Emergency Management Agency, and state and local enforcers.
The DOJ said last week that the hoarding and price-gouging task force had conducted an enforcement operation that resulted in the confiscation of more than a half-million items, including N95 respirator masks, medical-grade gloves, surgical gowns, disinfectant towels and bottles of hand sanitizer.
The agency said HHS will pay the owner of the equipment "pre-COVID-19 fair market value" and that the supplies were already being distributed to health care workers in New York and New Jersey.
While many states and local governments have statutes addressing price gouging, there's no specific federal law in the U.S. targeting the practice on its own. The DOJ's current enforcement authority comes through Trump's executive order.
Nevertheless, lawmakers have been concerned about excessive prices during the pandemic. The House Democrats that introduced the COVID-19 Price Gouging bill — Schakowsky, along with Reps. Jerrold Nadler, D-N.Y., Frank Pallone Jr., D-N.J., and David N. Cicilline, D-R.I. — sent a letter on March 18 to the Federal Trade Commission calling for vigilance and urging action to combat price gouging.
They cited reports of Amazon pulling exorbitantly priced face masks and disinfectant from its virtual storefronts, and said they'd also work on legislation to help enforcers crackdown on unfair pricing during the crisis.
A letter from more than a dozen Democratic senators, including Klobuchar, followed days later.
Representatives for the DOJ did not immediately respond to a request for comment Wednesday.
--Additional reporting by Nadia Dreid, Dorothy Atkins and Andrew Kragie. Editing by Adam LoBelia.
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