Baseline Reference Price

Most price gouging laws have been in effect throughout the country since early March due to the pandemic. As hurricane season gets underway, businesses should be aware that new states of emergency may be declared, overlapping with current pandemic states of emergency. New states of emergency may trigger price gouging laws that cover a variety of goods not currently covered under those related to COVID-19.

Price gouging statutes typically operate by setting a baseline over which any price increase is presumptively illegal, subject to various exemptions. But different states use different formulas for their baselines. Businesses who provide covered goods or services therefore need to determine the relevant baselines in order to calculate whether, and how much of, a price increase is permissible.