March 18, 2021 Articles

Lessons from COVID-Era Litigation at the Intersection of Price Gouging and Unfair Competition Relating to Medical Supplies

An overview of the law governing price gouging claims from a broad multi-jurisdictional perspective and lessons learned from the string of novel price gouging litigation in the medical context.

By Christopher W. Tackett

The global coronavirus pandemic has been a source of many challenges and many lessons for the legal profession. The virus has presented novel situations that have stretched and tested our legal frameworks around the country to deal with unprecedented situations. One traditionally rare claim area that has seen an explosion of litigation activity is the area of alleged price gouging. During the pandemic, there has been a rush of price gouging claims involving medical supplies and COVID-related personal protective equipment (PPE) in high demand. There have also been a lot of questions about whether manufacturers or retailers can raise prices of certain products to account for soaring demand. To address these topical issues, this article provides an overview of the law governing price gouging claims from a broad multi-jurisdictional perspective and discusses lessons learned from the string of novel price gouging litigation in the medical context.

Price gouging statutes vary greatly across the United States, yet there are common themes throughout most of the statutes. This article does not attempt a 50-state survey; instead, it intends to give a general overview of the statutes governing price gouging litigation and how medical supply price gouging litigation has broadened the scope of the types of claims we may see in the future.

Price gouging claims typically arise from claims that consumers are being taken advantage of with unconscionably excessive prices, an issue that is reviewed under a nebulous, subjective standard in many states. During the pandemic, however, there have also been unique price gouging claims raised by manufacturers to address unfair competition and protect the precious reputation of their brand. Specifically, as discussed below, manufacturers have asserted that unauthorized vendors have counterfeited their products, or sold their trademarked products without authority, to capture unmet demand, while also engaging in price gouging.

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