(Amended by Ord. No. 186,594, Eff. 4/28/20.)
(a) Findings. The City Council hereby finds that during a state of emergency, increasing prices for essential consumer goods and services and accumulating essential goods in excess of reasonable need for resale at inflated prices harms the public interest. To protect citizens from excessive and unjustified price increases and scarcity of essential goods, the City seeks to prevent price gouging and excessive accumulation of goods for resale that are vital and necessary for the health, safety, and welfare of Los Angeles residents.
(b) Legislative Intent. It is the intention of the City Council in enacting this ordinance to protect citizens from excessive and unjustified increases in the prices charged during any disruption of the marketplace for consumer goods and services vital and necessary for the health, safety, and welfare of residents resulting from emergency or major disaster, including, but not limited to, those resulting from public health crises, pandemics, earthquakes, fires or civil disturbances for which a state of emergency for the City of Los Angeles is proclaimed by the Mayor pursuant to Section 8.27 of the Los Angeles Administrative Code; or for which a proclamation of a state of emergency is declared by the President of the United States or the Governor of California, or upon the declaration of a local emergency by an official, board or other governing body vested with authority to make that declaration in Los Angeles County or in the City of Los Angeles.
(c) Definitions. The following definitions shall apply to this section:
1. “Consumer Food Item” is any item used or intended for use for food or drink by a person or animal.
2. “Emergency Supplies” are any items used in a typical emergency including but not limited to water, flashlights, radios, batteries, candles, blankets, soaps, cleaning supplies, disinfectants, sanitizers, toiletries, household paper goods, and diapers.
3. “Medical Supplies” are any items used in the diagnosis, cure, mitigation, treatment, or prevention of disease or other medical condition, including, but not limited to, prescription and non-prescription drugs, prescription and non-prescription medical devices, bandages, gauzes, isopropyl alcohol, and personal protective equipment, including, but not limited to, masks, gowns, face shields, and gloves.
4. “Repair or Reconstruction Services” are those contractor services for repairs to residential and commercial property of any type, which are damaged as a result of a disaster. Contractor services include services as defined in the California Business and Professions Code.
5. “Seller” means any person who sells or offers for sale in the chain of distribution any consumer food item, emergency supply, medical supply, repair or reconstruction service, gasoline or diesel fuel, including, but not limited to, any sales, resales, retail sales or wholesale sales.
6. “Similarly Situated Sellers” means persons, contractors, businesses or other entities where relevant circumstances show they are similar or alike. Relevant circumstances include, but are not limited to, the seller’s geographic location, the similarity of goods or services offered, including whether the goods or services are substitutes or complements to each other, and the relative size and scale of the seller’s business operation. For an online seller, all other online sellers shall be deemed to be similarly situated sellers.
(d) Excessive Price Increases Prohibited. Upon proclamation of a public emergency involving or threatening lives, property or welfare, pursuant to Section 8.27 of the Los Angeles Administrative Code, or for which a local disaster or emergency is declared by the President of the United States or Governor of California, or upon the declaration of a local emergency by an official, board or other governing body vested with authority to make that declaration in Los Angeles County or in the City of Los Angeles, and for a period of 30 days following the date such proclamation or declaration is terminated, it shall be unlawful for any person, contractor, business or other entity to sell or offer to sell any consumer food item, emergency supply, medical supply, repair or reconstruction service, gasoline or diesel fuel for:
1. a price more than 10 percent of the prevailing price for that item or service offered by similarly situated sellers in the City during the three months immediately prior to the proclamation or declaration of emergency, or
2. a price more than 10 percent of the price charged by that person for that item or service immediately prior to the proclamation or declaration of emergency, or
3. a price more than 10 percent of the price at which the same or similar items or services are available for purchase by consumers in the City during the time of the emergency.
(e) Defenses. A person, business, contractor or other entity may offer as a defense proof that an increase in price was directly attributable to the specific amount of the additional costs imposed on it by the supplier of the goods or for labor and materials used to provide the service.
(f) Excessive Accumulation for Resale at Inflated Prices Prohibited. Upon proclamation of public emergency involving or threatening lives, property or welfare, pursuant to Section 8.27 of the Los Angeles Administrative Code, or for which a local disaster or emergency is declared by the President of the United States or Governor of California, or upon the declaration of a local emergency by an official, board or other governing body vested with authority to make that declaration in Los Angeles County or in the City of Los Angeles and for a period of thirty days following the date such proclamation or declaration is terminated, it shall be unlawful for any person, contractor, business or other entity to accumulate emergency supplies or medical supplies in excess of the reasonable demands of business, personal or home consumption, for the purpose of resale at prices in excess of prevailing prices in the area in the City where the person, contractor, business or other entity is operating.
(g) Penalty.
1. Any person who shall be convicted of violating the provisions of this section shall be guilty of a misdemeanor and upon conviction thereof shall be punished by a fine of up to $1,000 or by imprisonment in the County Jail for not more than six months, or by both such fine and imprisonment.
2. The City Attorney may also prosecute a civil action under applicable state law to enforce this section and in any action a civil penalty may be imposed as provided by law and where appropriate, restitution ordered to aggrieved consumers.
(h) This section shall be liberally construed so that its beneficial purposes may be served in protecting the public from excessive increases in the prices charged for certain goods and services and in protecting against excessive accumulation of emergency supplies or medical supplies during the proclaimed or declared emergency.
(i) Conflicts. Nothing in this section shall be interpreted or applied to create any power or duty in conflict with any federal or state law.
(j) Severability. If any subsection, sentence, clause or phrase of this section is for any reason held to be invalid or unconstitutional by a court of competent jurisdiction, such decision shall not affect the validity of the remaining portions of this section. The City Council hereby declares that it would have adopted this section and each and every subsection, sentence, clause, and phrase thereof not declared invalid or unconstitutional, without regard to whether any portion of the section would be subsequently declared invalid or unconstitutional.