California grocery chain to pay $175k for price gouging eggs during pandemic

California grocery chain to pay $175k for price gouging eggs during pandemic

April 7, 2022 0 By Madison Hirneisen

Grocery store chain Smart & Final will pay $175,000 to resolve allegations that the store price gouged certain kinds of eggs in the early months of the COVID-19 pandemic, Attorney General Rob Bonta announced Tuesday.

Bonta alleged that the grocery store chain, which has more than 250 stores throughout the western United States, increased the price of four different kinds of premium eggs “beyond what was allowable during a state of emergency” between March 4 and June 22, 2020.

Bonta’s office estimated that the chain sold over 100,000 cartons of illegally priced eggs while price gouging protections were in place during the state of emergency.

“It is unacceptable to take advantage of hardworking California families during times of crisis,” Bonta said in a statement. “When California first went into lockdown at the beginning of the pandemic, there was a run on essential supplies, and unfortunately, some businesses saw this as an opportunity to pad their bottom line.

“Let me be clear, price gouging during a declared state of emergency is illegal. Today’s settlement should serve as a warning to grocers and other sellers of essential supplies: Follow state price gouging laws, or you will be held accountable.”

As part of the settlement, Smart & Final will pay $175,000.

Existing state law makes it unlawful to sell goods and necessities for 10% higher prices during the first 30 days of a state of emergency, except when the price increases are due to increased supply or labor costs, according to Bonta.

While Smart & Final agrees to pay the fine associated with price gouging, the grocer isn’t admitting any wrongdoing. The money will be remitted to the state, according to the settlement.

Newsom declared a state of emergency on March 4, 2020, which enacted price gouging protections. The governor then issued an executive order in April 2020 that extended price gouging protections for five months.

Bonta said that his office received a number of price-gouging complaints pertaining to the price of eggs after Newsom’s emergency declaration was signed. The attorney general said that an investigation revealed Smart & Final had raised their prices of “certain products” by more than 10% over prices before the state of emergency.

In a statement, Smart & Final said Tuesday that the chain experienced numerous supplier price increases since the start of the pandemic.

“In response to the rapid pace of these price increases, we briefly and unintentionally raised the price of premium eggs to align with supplier price increases on standard eggs,” the company said. “We want our valued customers to know that price gouging has no place in our stores. We will continue to review our pricing to ensure it remains compliant.”

This article was originally posted on California grocery chain to pay $175k for price gouging eggs during pandemic