OAKLAND – California Attorney General Rob Bonta today issued a consumer alert following the Governor’s declaration of a state of emergency for Humboldt County following a 6.4 magnitude earthquake near the Cities of Ferndale and Rio Dell. The earthquake resulted in two fatalities, injured multiple people, caused power outages, and damaged roads, bridges, buildings, and critical infrastructure, including water lines and gas lines. In today’s alert, Attorney General Bonta reminds all Californians that price gouging during a state of emergency is illegal under Penal Code Section 396. Californians who believe they have been the victim of price gouging should report it to their local authorities or to the Attorney General at oag.ca.gov/report.
“My heart goes out to residents and local business owners in Ferndale, Rio Dell, and the surrounding community as they grapple with the damage caused by yesterday’s earthquake and the nearly one hundred aftershocks that followed,” said Attorney General Bonta. “It will be a while before we know the full extent of the damage, but as Humboldt County begins to recover, I want to remind residents and businesses that price gouging during a state of emergency is illegal. If you see businesses raising the price of food, gas, or other emergency supplies, report it to your local authorities or to my office at oag.ca.gov/report.”
California law generally prohibits charging a price that exceeds, by more than 10%, the price of an item before a state or local declaration of emergency. For any item a seller only began selling after an emergency declaration, the law generally prohibits charging a price that exceeds the seller's cost of the item by more than 50%.
This law applies to those who sell food, emergency supplies, medical supplies, building materials, and gasoline. The law also applies to repair or reconstruction services, emergency cleanup services, certain transportation services, freight and storage services, hotel accommodations, and rental housing. Exceptions to this prohibition exist if, for example, the price of labor, goods, or materials has increased for the business.
Violators of the price gouging statute are subject to criminal prosecution that can result in a one-year imprisonment in county jail and/or a fine of up to $10,000. Violators are also subject to civil enforcement actions including civil penalties of up to $2,500 per violation, injunctive relief, and mandatory restitution. The Attorney General and local district attorneys can enforce the statute.
For additional information on price gouging, please see oag.ca.gov/consumers/pricegougingduringdisasters.