ELMIRA, N.Y. (Legal Newsline) - New York Attorney General Eric Schneiderman announced a settlement on Tuesday with the owner of a tree removal company for allegedly engaging in price-gouging after a tornado hit Elmira in July 2012.
Lonnie Drake, doing business as Upstate New York Tree Service, allegedly charged grossly excessive prices for tree removal services after the tornado. Drake allegedly charged as much as $2,650 per pick or leader of a tree, a rate he had never before charged for the service. He also allegedly charged consumers covered by insurance the higher rate, in addition to $810 per load to haul away debris.
Additionally, Drake allegedly inflated prices and offered discounts to consumers, making the consumers think they were receiving a bargain price.
"Price gouging in the wake of a storm kicks vulnerable New Yorkers while they are down," Schneiderman said. "My office will continue fighting to hold these companies accountable and make sure nothing gets in the way of helping hardworking New York families get back on their feet after disaster strikes."
New York State's Price Gouging Law prohibits the unjustified price inflation of essential services and goods during an abnormal market disruption, such as the disruption caused by a flood, hurricane, tropical storm or other disaster. Tree removal services are considered essential services in the wake of a disaster.
Under the terms of the settlement, Drake agreed to pay more than $9,600 in refunds to ten consumers who had been charged a separate hauling fee or should have been given a senior citizen discount. Drake will also pay civil penalties and costs of $7,000. Upstate New York Tree Service is prohibited from engaging in any illegal, deceptive or fraudulent business practice and may not charge excessive prices during any abnormal disruption of the market.