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Will Concerns Over Coronavirus Lead to a State Price-Gouging Law?

There’s been a run on surgical safety masks since concerns over COVID-19 began spreading almost as fast as the virus itself. The face masks generally sold for roughly $1 apiece before the outbreak, but are in short supply these days.

Anyone with the foresight to stockpile the masks in advance now has a valuable commodity on his hands, as a Duluth News Tribune reporter found over the weekend.

A man selling N95 respirator safety masks outside a grocery store lot along state Highway 33 in Cloquet wouldn’t give his name on Sunday, but said he looked up whether he could price-gouge or not.

Selling 10- and 20-count boxes of masks for $50 and $99 out of the back of his minivan, he told the News Tribune, “I checked on it.”

He declined to give any identifying details when interviewed around 1 p.m.

“Yes, I marked them up; you can’t get them at Home Depot, or Menards, not anymore,” he said. “I’m just selling what I have.”

Minnesota Attorney General Keith Ellison has used the specter of profiteering off the pandemic to push for price-gouging legislation in Minnesota.

“Not many people realize that Minnesota doesn’t have a law against price gouging, as 30 other states do. I think we should,” Ellison said. “I’m glad a bill to ban price-gouging has been introduced in the Minnesota House. I strongly encourage the Legislature to pass it as quickly as possible so that we can protect Minnesota consumers from these despicable practices. Although we can’t legally fight price-gouging right now, the more people tell us about it, the more we’ll be able advocate for a bill that will allow us to fight it.”

Price-gouging laws in other states kick in with declaration of a state or national emergency. South Carolina, for example, just invoked its prohibition on excessive profiteering, according to a South Carolina TV station.

This law makes it unlawful to “rent or sell or offer to rent or sell a commodity at an unconscionable price.” The law remains in effect until the declaration expires or is terminated…

“We can expect normal price increases, but we may see businesses and individuals looking to unfairly take advantage of the situation through price gouging of things like hand sanitizer, cleaning supplies, toilet paper, and other commodities as defined by the statute. By our law, that’s a criminal violation and an unfair trade practice,” Attorney General Alan Wilson said.

It’s not clear the pandemic has led to a surge in problem pricing here. But the price-gouging bill introduced last Friday in the House, HF4454, appears to mirror the South Carolina statute. In the case of the northern Minnesota roadside entrepreneur peddling the safety masks, however, it seems that having a reporter ask a few questions was enough to shut him down.

After many reports, the Cloquet Police Department checked on the unidentified man, but he was already gone.

“Cloquet City Code 6.6 requires transient merchants and peddlers to apply for a license from the city,” Cloquet Interim Police Chief Derek Randall said on social media. “If the person is located, we will check his merchant license status.”

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