California fines Smart & Final $175,000 for price gouging

April 6, 2022

By JOSH FRIEDMAN

The state of California has reached a $175,000 settlement with grocer Smart & Final for price gouging customers who purchased eggs early on in the COVID-19 pandemic.

On March 4, 2020, California Gov. Gavin Newsom declared a state of emergency, triggering state price gouging protections. Between March 4 and June 22, 2020, Smart & Final increased the prices of four premium egg products beyond what was allowable during the state of emergency, according to the California Attorney General’s Office.

Smart & Final raised the prices of certain eggs more than 10 percent above what they were prior to Newsom’s emergency declaration, doing so without an accompanying increase in supply costs. An attorney general’s investigation found Smart & Final sold more than 100,000 cartons of eggs for dollar amounts that violated the price gouging protections.

“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,” Attorney General Rob Bonta said in a statement on Tuesday. “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.”

Smart & Final’s settlement requires the grocer to pay $175,000 in penalties and to, in the future, abide by California’s Unfair Competition Law and all executive orders related to price gouging.