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HB 5895

Trade: business practices; excessively increased pricing for certain goods and services during a declared state of emergency; prohibit. Creates new act.

2023-2024 Regular Session Introduced by Jason Hoskins

Prohibits selling essential goods and services at unjustified price increases during and after a governor’s emergency, with violations punishable civilly.

REFERRED TO COMMITTEE ON GOVERNMENT OPERATIONS
#consumerprotection:unfairtradepractices #stateagencies(existing):attorneygeneral #trade:businesspractices #trade:consumergoodsandservices
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Bill Summary · HB 5895

HB 5895 — Commodities and Emergency Services and Supplies Pricing Protection Act

Status: Referred to Committee on Government Operations. Introduced July 30, 2024; Passed by House (H-3 substitute) December 13, 2024 (Roll Call 56‑0); transmitted to Senate; subsequent referrals to Government Operations (12/18/2024) and Joint Committee on Education (1/22/2025).

Purpose

To prohibit excessive price increases (commonly called "price gouging") for certain essential commodities, emergency supplies, medical supplies and related services during — and for a reasonable period after — a governor‑declared state of emergency in Michigan.

Key provisions

  • Creates the "Commodities and Emergency Services and Supplies Pricing Protection Act."
  • Prohibits any person conducting business in any chain of distribution for covered items from, during or reasonably after a declared state of emergency in an affected county/city/township:
    • Charging a price that is "grossly in excess" of comparable market prices;
    • Charging an "excessively increased price"; or
    • Offering covered items at an excessively increased price.
  • Defines "excessively increased price" as an unjustified disparity between the pre‑emergency price and the price during/reasonably after the emergency. As passed by the House (H‑3), an unjustified disparity is generally a change of more than 20% unless the seller proves the increase is due to:
    • higher costs to bring the item/services to market,
    • an extraordinary pre‑emergency discount, or
    • a markup at or below retailer cost (depending on version language).
  • Covered items include building materials, consumer food items, goods, services (including repair and improvement services), emergency supplies (e.g., water, batteries, plywood, blankets), and medical supplies (e.g., prescription and OTC medications, bandages).

Enforcement and remedies

  • The Attorney General (and local prosecuting attorneys) may investigate, issue written investigative demands for documents/testimony (confidential until an enforcement action is filed), and bring civil actions.
  • The AG may bring a class action on behalf of Michigan residents to recover actual damages (or $100, whichever is greater).
  • Courts may order reimbursements, equitable relief (including rescission/adjustment of contracts), appointment of a receiver, sequestration of assets, and require defendants to pay notice costs to the class.
  • The bill includes procedural protections for compliance and court modification of investigative demands.

Who is affected

  • Retailers, wholesalers, distributors, manufacturers, service providers, contractors, and any legal entity in the chain of distribution for the covered commodities and services located or doing business in areas subject to a declared state of emergency.

Timing and scope

  • Applies during a governor‑declared state of emergency and “reasonably after” the declaration in jurisdictions subject to the declaration.
  • House substitutes and committee reports varied the threshold (10%, 15%, 20% appeared in different drafts); the H‑3 substitute that passed the House defines the unjustified disparity threshold as more than 20% (subject to allowable cost‑based defenses).
  • The bill is tie‑barred to companion bills (HB 5896 — lodging; HB 5897 — energy pricing), which address similar prohibitions for hotels and certain energy products/services.

Notes

  • The measure as passed by the House provides civil enforcement remedies; no criminal penalties are specified in the provided text.
  • Final language and thresholds could change in the Senate; check subsequent versions for amendments before enactment.

Compiled from official sources — confirm details with the bill’s official record.

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