II 

109TH CONGRESS 

1ST SESSION S. 1744 

To prohibit price gouging relating to gasoline and diesel fuels in areas affected 

by major disasters. 

IN THE SENATE OF THE UNITED STATES 

SEPTEMBER 21, 2005 

Mr. NELSON of Florida (for himself and Mr. BINGAMAN) introduced the following bill; which was read twice and referred to the Committee on Commerce, Science, and Transportation 

A BILL 

To prohibit price gouging relating to gasoline and diesel 

fuels in areas affected by major disasters. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Price Gouging Act of 

5 2005’’. 

6 SEC. 2. PRICE GOUGING PROHIBITION FOLLOWING MAJOR 

7 DISASTERS. 

8 The Federal Trade Commission Act (15 U.S.C. 41 

9 et seq.) is amended— 
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1 (1) by redesignating sections 25 and 26 (15 

2 U.S.C. 57c, 58) as sections 26 and 27, respectively; 

3 and 

4 (2) by inserting after section 24 (15 U.S.C. 

5 57b–5) the following: 

6 ‘‘SEC. 25. PROTECTION FROM PRICE GOUGING FOLLOWING 

7 MAJOR DISASTERS. 

8 ‘‘(a) DEFINITIONS.—In this section: 

9 ‘‘(1) AFFECTED AREA.—The term ‘affected 

10 area’ means an area affected by a major disaster de11 clared by the President under Federal law in exist12 ence on the date of enactment of this subsection. 

13 ‘‘(2) PRICE GOUGING.—The term ‘price 

14 gouging’ means the charging of an unconscionably 

15 excessive price by a supplier in an affected area. 

16 ‘‘(3) SUPPLIER.—The term ‘supplier’ means 

17 any person that sells gasoline or diesel fuel for resale 

18 or ultimate consumption. 

19 ‘‘(4) UNCONSCIONABLY EXCESSIVE PRICE.— 

20 The term ‘unconscionably excessive price’ means a 

21 price charged in an affected area for gasoline or die22 sel fuel that— 

23 ‘‘(A) represents a gross disparity, as deter24 mined by the Commission in accordance with 

25 subsection (e), between the price charged for 
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1 gasoline or diesel fuel and the average price of 

2 gasoline or diesel fuel charged by suppliers in 

3 the affected area during the 30-day period im4 mediately before the President declares the ex5 istence of a major disaster; and 

6 ‘‘(B) is not attributable to increased whole7 sale or operational costs incurred by the sup8 plier in connection with the sale of gasoline or 

9 diesel fuel. 

10 ‘‘(b) DETERMINATION OF THE COMMISSION.—Fol11 lowing the declaration of a major disaster by the Presi12 dent, the Commission shall— 

13 ‘‘(1) consult with the Attorney General, the 

14 United States Attorney for the district in which the 

15 disaster occurred, and State and local law enforce16 ment officials to determine whether any supplier in 

17 the affected area is charging or has charged an un18 conscionably excessive price for gasoline or diesel 

19 fuel provided in the affected area; and 

20 ‘‘(2) establish within the Commission— 

21 ‘‘(A) a toll-free hotline that a consumer 

22 may call to report an incidence of price gouging 

23 in the affected area; and 

24 ‘‘(B) a program to develop and distribute 

25 to the public informational materials in English 
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1 and Spanish to assist residents of the affected 

2 area in detecting and avoiding price gouging. 

3 ‘‘(c) PRICE GOUGING INVOLVING DISASTER VIC4 TIMS.— 

5 ‘‘(1) OFFENSE.—During the 180-day period 

6 after the date on which a major disaster is declared 

7 by the President, no supplier shall sell, or offer to 

8 sell, gasoline or diesel fuel in an affected area at an 

9 unconscionably excessive price. 

10 ‘‘(2) ACTION BY COMMISSION.— 

11 ‘‘(A) IN GENERAL.—During the period de12 scribed in paragraph (1), the Commission shall 

13 conduct investigations to determine whether any 

14 supplier in an affected area is in violation of 

15 paragraph (1). 

16 ‘‘(B) POSITIVE DETERMINATION.—If the 

17 Commission determines under subparagraph 

18 (A) that a supplier is in violation of paragraph 

19 (1), the Commission shall take any action the 

20 Commission determines to be appropriate to 

21 remedy the violation. 

22 ‘‘(3) CIVIL PENALTIES.—A supplier that com23 mits an offense described in paragraph (1) may, in 

24 a civil action brought in a court of competent juris25 diction, be subject to— 
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1 ‘‘(A) a civil penalty of not more than 

2 $500,000; 

3 ‘‘(B) an order to pay special and punitive 

4 damages; 

5 ‘‘(C) an order to pay reasonable attorney’s 

6 fees; 

7 ‘‘(D) an order to pay costs of litigation re8 lating to the offense; 

9 ‘‘(E) an order for disgorgement of profits 

10 earned as a result of a violation of paragraph 

11 (1); and 

12 ‘‘(F) any other relief determined by the 

13 court to be appropriate. 

14 ‘‘(4) CRIMINAL PENALTY.—A supplier that 

15 knowingly commits an offense described in para16 graph (1) shall be imprisoned not more than 1 year. 

17 ‘‘(5) ACTION BY VICTIMS.—A person, Federal 

18 agency, State, or local government that suffers loss 

19 or damage as a result of a violation of paragraph (1) 

20 may bring a civil action against a supplier in any 

21 court of competent jurisdiction for disgorgement, 

22 special or punitive damages, injunctive relief, reason23 able attorney’s fees, costs of the litigation, and any 

24 other appropriate legal or equitable relief. 
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1 ‘‘(6) ACTION BY STATE ATTORNEYS GEN2 ERAL.—An attorney general of a State, or other au3 thorized State official, may bring a civil action in the 

4 name of the State, on behalf of persons residing in 

5 the State, in any court of competent jurisdiction for 

6 disgorgement, special or punitive damages, reason7 able attorney’s fees, costs of litigation, and any other 

8 appropriate legal or equitable relief. 

9 ‘‘(7) NO PREEMPTION.—Nothing in this section 

10 preempts any State law. 

11 ‘‘(d) REPORT.—Not later than 1 year after the date 

12 of enactment of this subsection, and annually thereafter, 

13 the Commission shall submit to the Committee on Com14 merce, Science, and Transportation of the Senate and the 

15 Committee on Energy and Commerce of the House of 

16 Representatives a report describing— 

17 ‘‘(1) the number of price gouging complaints re18 ceived by the Commission for each major disaster 

19 declared by the President during the preceding year; 

20 ‘‘(2) the number of price gouging investigations 

21 of the Commission initiated, in progress, and com22 pleted as of the date on which the report is pre23 pared; 
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1 ‘‘(3) the number of enforcement actions of the 

2 Commission initiated, in progress, and completed as 

3 of the date on which the report is prepared; 

4 ‘‘(4) an evaluation of the effectiveness of the 

5 toll-free hotline and program established under sub6 section (b)(2); and 

7 ‘‘(5) recommendations for any additional action 

8 with respect to the implementation or effectiveness 

9 of this section. 

10 ‘‘(e) DEFINITION OF GROSS DISPARITY.—Not later 

11 than 180 days after the date of enactment of this sub12 section, the Commission shall promulgate regulations to 

13 define the term ‘gross disparity’ for purposes of this sec14 tion.’’. 

15 SEC. 3. EFFECT OF ACT. 

16 Nothing in this Act, or an amendment made by this 

17 Act, affects any authority of the Federal Trade Commis18 sion in existence on the date of enactment of this Act with 

19 respect to price gouging actions. 

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