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$86 toilet paper triggers Iowa’s first price-gouging lawsuit
A northwest Iowa man is the first person to face a price-gouging lawsuit after the Iowa Attorney General's Office received complaints he was selling a 12-count package of toilet paper for $86 on eBay.
The lawsuit, which carries a penalty of up to $40,000 under the Iowa Consumer Fraud Act, alleges that Michael Evan Noteboom of Orange City also was selling a 12-ounce can of Lysol on eBay for $65.99 and a six-count pack of Bounty paper towels for $49.99.
The highest priced item was a 12-count package of Bounty paper towels for $119.99.
Target.com is selling six-count packages of Bounty paper towels for $5.49 - although the online retailer warns items may not be available due to high demand.
'Our office has warned the defendant repeatedly to stop his activity,” Iowa Attorney General Tom Miller said.
A warning went out March 24. Then on April 2, Miller's office sent Noteboom a letter directing him to cease and desist from violating the price-gouging rule. He has refused or otherwise failed to respond, Miller said.
The investigation by the Attorney General's Office showed that Noteboom, from March 2 through March 27, sold 253 items on eBay to consumers in several states, including California, Illinois, New York, Michigan and Texas.
Noteboom could not be reached for comment.
The complaint against Noteboom is typical of those the attorney general has received during the coronavirus pandemic, according to spokesman Lynn Hicks.
'Most of the reports we're getting are these kinds of things - toilet paper, paper towels, any kind of cleaning products,” he said.
However, not all of the complaints have been about cleaning supplies.
'We've gotten some complaints from people about the price of wine going up,” Hicks said.
While some Iowans may be relying on wine to cope with the challenges presented by the coronavirus pandemic, 'that doesn't mean it's necessary during a disaster,” Hicks said.
The office also has fielded complaints about the cost of eggs, and Hicks expects that if meat prices rise because of shutdowns at meatpacking plants, the attorney general will get complaints about that.
He explained the state's price gouging law applies only if the price being charged for an item necessary during a disaster declaration is 'not justified by the seller's actual costs of acquiring, producing, selling, transporting and delivering the actual product sold, plus a reasonable profit.”
Although most of the 470 complaints the attorney general has received involve online sellers, the prohibition on charging excessive prices applies to all sellers, including brick and mortar stores, suppliers and sales on social media sites. Sellers who set excessive prices on online auction sites are not exempt from the law.
When made aware of what looks like excessive prices, the Attorney General's Office often posts a warning on those online sites telling sellers they appear to be violating state law. In many cases, the sellers take down those offers or lower their prices.
The attorney general also has written to the online platforms to ask that they remove the for-sale offers and, in some cases, the operators of the platforms have provided information to the state Consumer Protection Division.
Iowa's Better Business Bureau has had few complaints, according to Bobby Hansen, director for the Cedar Rapids region. It has received reports of companies not filling customer's orders. In those cases, he said, customers should deal directly with their credit card companies.
The BBB also is looking into a phony company selling personal protective equipment.
Much of Iowa's retail community has not been open for business in recent weeks, Hansen said, 'but the grocery stores have been fantastic in making sure things are not overpriced.”
If consumers see what they believe to be price gouging, they can call the attorney general's Consumer Protection Division at 1-(888) 777-4590 or email firstname.lastname@example.org.
To contact the Better Business Bureau, visit bbb.org/Iowa or call 1-(800) 222-1600.
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