Oregon Governor Declares Abnormal Disruption Of The Marketplace

AG Monitors Supply And Sales Of Goods And Services In North Coast Areas

December 11, 2007 -- Oregon Governor Ted Kulongoski today announced his decision to declare an abnormal disruption of the marketplace in geographical areas affected by last week's storm, as allowed by Senate Bill 118, the state's new anti-price gouging law.

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"The storms and their aftermath have wreaked havoc on many Oregonians in the last week," stated Governor Kulongoski. "By issuing this declaration, these victims will be protected from unscrupulous retailers and those attempting to take advantage of the needy and vulnerable," he added.

The new law provides that, upon a declaration by the Governor, merchants and wholesalers offering basic goods and services deemed essential to consumers in resuming their livelihoods immediately following the storm, including food, water, petroleum or repair materials or services, are prohibited from charging unconscionably excessive prices. The law gives the Attorney General the responsibility for regulating the prohibited conduct as an unlawful trade practice.

Senate Bill 118 is triggered at a point in which conditions result in the threat that an essential consumer good and service is not readily available in certain geographical areas. The Governor determined that, as of 3:52 p.m. on Monday, December 3, 2007, Clatsop, Columbia and Tillamook Counties were declared official states of emergency and in part due to that declaration were also determined to be areas in which the marketplace was disrupted in an abnormal fashion. Reports of increased demand for repair materials, generators and basic services, such as gasoline, have been submitted to the Department of Justice.

"We have received only a handful of complaints regarding unnecessary high prices for basic goods and services," stated Attorney General Hardy Myers. "However," he added, "the law requires that if a direct result of last week's storm is an increased demand or lack of supply of an essential good or service, in order to protect Oregonians, it is imperative for the Governor to make this declaration."

Myers noted that a price increase of 15 percent or more during the Governor's declaration is the typical definition that makes a cost of a good or service "unconscionably excessive" under the law. He also added that exemptions to the price gouging law exist to accommodate legitimate reasons a business may need to raise its prices. Those exemptions include:

* Increases attributable to additional costs imposed by suppliers (e.g., exterior market costs, etc.);
* Increases attributable to additional costs necessarily incurred in procuring the essential consumer goods or services immediately prior to or during the declaration (e.g., flying-in supplies, etc.,);
* Increases attributable to increased internal costs or expenses related to the declaration (e.g., overtime, additional staff, security, distribution, etc.,); and
* Increases attributable to increased costs unrelated to the declaration (e.g., scheduled price or costs increases, etc.).

Allegations of price gouging or instances in which prices are excessively high relative to their cost prior to the storm should be reported to the Attorney General's consumer protection hotline at (503) 378-4320 (Salem area only), (503) 229-5576 (Portland area only), or toll-free at 1-877-877-9392. Complaints can be filed online at www.doj.state.or.us. Hotline hours are 8:30 a.m. to 4:30 p.m.

Source: Oregon Governor