FRANKFORT, Ky. (Legal Newsline) – Online retailers are suing the State of Kentucky over its enforcement of price-control laws during the coronavirus state of emergency.
The Online Merchants Guild, a trade association, filed suit against Kentucky Attorney General Daniel Cameron on May 1, complaining that his anti-price-gouging crusade has forced those doing business on Amazon to list Kentucky-specific prices for COVID-19-response goods.
“Although the goal may be understandable, the effect is unlawful,” the complaint says.
Cameron’s effort is essentially a national regulation of online merchants who can’t survive on Kentucky-only business, the lawsuit says. It wants a federal judge to rule the state’s price-gouging laws are unconstitutional as it pertains to it.
But Cameron could still ask Amazon to combat unreasonable prices, OMG says.
"Various Online Merchants Guild members have, or intend to, offer in-demand items like hand sanitizer and PPE online, and specifically via Amazon’s store,” the lawsuit says.
“For example, an Online Merchants Guild member might acquire hand sanitizer in a state in the middle of the country with relatively few cases of coronavirus, and offer that product in the national marketplace using Amazon, where it might be purchased by a consumer in a state with higher demand for the product.
“To be economical, the offer price will need to be higher than the purchase price and other cost inputs (including Amazon’s commission); the offer price may also reflect a demand premium. Such transactions respond to consumer demand dynamics. They lead to an efficient allocation of goods in the national marketplace, and generate price signals for manufacturers, which can lead to increased production of in-demand goods.”
U.S. District Court for the Eastern District of Kentucky case number 3:20-cv-00029