[Congressional Record Volume 151, Number 111 (Thursday, September 8, 2005)]
[Senate]
[Pages S9845-S9846]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. NELSON of Florida:
  S. 1640. A bill to prohibit price gouging relating to certain goods 
and services in areas affected by major disasters; to the Committee on 
Commerce, Science, and Transportation.
  Mr. NELSON of Florida. Mr. President, I rise today to introduce the 
``Protection from Price Gouging Against Disaster Victims Act of 2005'' 
and ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1640

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Protection From Price 
     Gouging Against Disaster Victims Act of 2005''.

     SEC. 2. FINDINGS AND GOALS.

       (a) Findings.--Congress finds that--
       (1) the United States experiences tremendous generosity and 
     goodwill in the wake of natural disasters;
       (2) unfortunately, some unscrupulous individuals take 
     advantage of those disasters in an attempt to gain 
     financially;
       (3) the Federal Trade Commission is charged with preventing 
     unfair methods of competition and unfair and deceptive acts 
     or practices under section 5 of the Federal Trade Commission 
     Act (15 U.S.C. 45);
       (4) the Federal Trade Commission has extensive experience 
     analyzing markets and competitive issues in order to 
     determine whether market participants are engaging in actions 
     that may have anticompetitive effects; and
       (5) the Committee on Commerce, Science, and Transportation 
     of the Senate and the Committee on Energy and Commerce of the 
     House of Representatives are charged by their respective 
     Houses with consumer protection.
       (b) Goals.--The goals of this Act are--
       (1) to decrease the occurrence of persons charging 
     unconscionably excessive prices for consumer goods and 
     services following natural disasters;
       (2) to require the Federal Trade Commission to conduct 
     ongoing investigations of actions intended to disadvantage 
     consumers following natural disasters; and
       (3) to ensure that sufficient enforcement authority is 
     available to the Commission to carry out the responsibilities 
     of the Commission under this Act and the amendments made by 
     this Act.

     SEC. 3. PRICE GOUGING PROHIBITION FOLLOWING MAJOR DISASTERS.

       The Federal Trade Commission Act (15 U.S.C. 41 et seq.) is 
     amended--
       (1) by redesignating sections 25 and 26 as sections 26 and 
     27, respectively; and
       (2) by inserting after section 24 the following:

     ``SEC. 25. PROTECTION FROM PRICE GOUGING FOLLOWING MAJOR 
                   DISASTERS.

       ``(a) Definitions.--In this section:
       ``(1) Affected area.--The term `affected area' means an 
     area affected by a major disaster declared by the President 
     under Federal law in existence on the date of enactment of 
     the Protection From Price Gouging Against Disaster Victims 
     Act of 2005.
       ``(2) Consumer good or service.--
       ``(A) In general.--The term `consumer good or service' 
     means a good, piece of equipment, or service provided 
     primarily for personal, family, or household purposes, 
     including food, water, ice, a chemical, a building supply, a 
     tool, a petroleum product, a residential construction, 
     reconstruction, or repair service, or a service for the 
     removal of debris (including a damaged tree) or garbage.
       ``(B) Inclusion.--The term `consumer good or service' 
     includes a property or a facility rented to a consumer for 
     use as a residence or storage facility.
       ``(3) Price gouging.--The term `price gouging' means the 
     charging of an unconscionably excessive price by a supplier 
     in an affected area.
       ``(4) Supplier.--The term `supplier' includes a seller, 
     reseller, wholesaler, distributor, retailer, lessor, 
     provider, or licensed or unlicensed contractor, 
     subcontractor, or laborer engaged in the provision or 
     distribution of a consumer good or service.
       ``(5) Unconscionably excessive price.--The term 
     `unconscionably excessive price' means a price charged in an 
     affected area for a consumer good or service that--
       ``(A) represents a gross disparity, as determined by the 
     Commission in accordance with subsection (e), between the 
     price charged for the good or service and the average price 
     of the good or service charged by suppliers in the affected 
     area during the 30-day period immediately before the 
     President declares the existence of a major disaster; and
       ``(B) is not attributable to increased wholesale or 
     operational costs incurred by the supplier in connection with 
     the provision of the consumer good or service.
       ``(b) Determination of the Commission.--Following the 
     declaration of a major disaster by the President, the 
     Commission shall--
       ``(1) consult with the Attorney General of the United 
     States, the United States Attorney for the district in which 
     the disaster occurred, and State and local law enforcement 
     officials to determine whether any supplier in the affected 
     area is charging or has charged an unconscionably excessive 
     price for any consumer good or service provided in the 
     affected area; and
       ``(2) establish within the Commission--
       ``(A) a toll-free hotline that a consumer may call to 
     report an incidence of price gouging in the affected area; 
     and
       ``(B) a program to develop and distribute to the public 
     informational materials in English and Spanish to assist 
     residents of the affected area in detecting and avoiding 
     price gouging.
       ``(c) Price Gouging Involving Disaster Victims.--
       ``(1) Offense.--During the 180-day period after the date on 
     which a major disaster is declared by the President, no 
     supplier shall provide, or offer to provide, any consumer 
     good or service in an affected area at an unconscionably 
     excessive price.
       ``(2) Action by commission.--
       ``(A) In general.--During the period described in paragraph 
     (1), the Commission shall conduct investigations to determine 
     whether any supplier in an affected area is in violation of 
     paragraph (1).
       ``(B) Positive determination.--If the Commission determines 
     under subparagraph (A) that a supplier is in violation of 
     paragraph

[[Page S9846]]

     (1), the Commission shall take any action the Commission 
     determines to be appropriate to remedy the violation.
       ``(3) Civil penalties.--A supplier that commits an offense 
     described in paragraph (1) may, in a civil action brought in 
     a court of competent jurisdiction, be subject to--
       ``(A) a civil penalty not more than $500,000;
       ``(B) an order to pay special and punitive damages;
       ``(C) an order to pay reasonable attorney's fees;
       ``(D) an order to pay costs of litigation relating to the 
     offense;
       ``(E) an order for disgorgement of profits earned as a 
     result of a violation of paragraph (1); and
       ``(F) any other relief determined by the court to be 
     appropriate.
       ``(4) Criminal penalty.--A supplier that knowingly commits 
     an offense described in paragraph (1) shall be imprisoned not 
     more than 1 year.
       ``(5) Action by victims.--A person, Federal agency, State, 
     or local government that suffers loss or damage as a result 
     of a violation of paragraph (1) may bring a civil action 
     against a supplier in any court of competent jurisdiction for 
     disgorgement, special or punitive damages, injunctive relief, 
     reasonable attorney's fees, costs of the litigation, and any 
     other appropriate legal or equitable relief.
       ``(6) Action by state attorneys general.--An attorney 
     general of a State, or other authorized State official, may 
     bring a civil action in the name of the State, on behalf of 
     persons residing in the State, in any court of competent 
     jurisdiction for disgorgement, special or punitive damages, 
     reasonable attorney's fees, costs of litigation, and any 
     other appropriate legal or equitable relief.
       ``(7) No preemption.--Nothing in this section preempts any 
     State law.
       ``(d) Report.--Not later than 1 year after the date of 
     enactment of the Protection From Price Gouging Against 
     Disaster Victims Act of 2005, and annually thereafter, the 
     Commission shall submit to the Committee on Commerce, 
     Science, and Transportation of the Senate and the Committee 
     on Energy and Commerce of the House of Representatives a 
     report describing--
       ``(1) the number of price gouging complaints received by 
     the Commission for each major disaster declared by the 
     President during the preceding year;
       ``(2) the number of price gouging investigations of the 
     Commission initiated, in progress, and completed as of the 
     date on which the report is prepared;
       ``(3) the number of enforcement actions of the Commission 
     initiated, in progress, and completed as of the date on which 
     the report is prepared;
       ``(4) an evaluation of the effectiveness of the toll-free 
     hotline and program established under subsection (b)(2); and
       ``(5) recommendations for any additional action with 
     respect to the implementation or effectiveness of this 
     section.
       ``(e) Definition of Gross Disparity.--Not later than 180 
     days after the date of enactment of the Protection From Price 
     Gouging Against Disaster Victims Act of 2005, the Commission 
     shall promulgate regulations to define the term `gross 
     disparity' for purposes of this section.''.

     SEC. 4. EFFECT OF ACT.

       Nothing in this Act, or an amendment made by this Act, 
     affects any authority of the Federal Trade Commission in 
     existence on the date of enactment of this Act with respect 
     to price gouging actions.
                                 ______